<PAGE>
PAGE 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________________
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
October 6, 1997
FMC CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 1-2376 94-0479804
- ---------------------------- ------------ ------------------
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
200 East Randolph Drive, Chicago, Illinois 60601
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(Address of principal executive offices) (Zip Code)
(312) 861-6000
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Registrant's telephone number,
including area code
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PAGE 2
This Form 8-K/A amends Form 8-K (dated October 6, 1997 and filed by Registrant
on October 8, 1997) and Form 8-K/A (dated October 6, 1997 and filed by
Registrant on October 16, 1997) by providing the full text of two exhibits with
respect to which Registrant had previously sought confidential treatment.
Item 7. Financial Statements and Exhibits
(c) see Exhibit Index
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PAGE 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FMC CORPORATION
By /s/ William J. Kirby
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William J. Kirby
Senior Vice President
Date: December 23, 1997
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PAGE 4
Exhibit Index
<TABLE>
<CAPTION>
Number in
Exhibit Table Description
- ------------- -----------
<S> <C>
10.1 Supplemental Agreement No. 1 to Purchase Agreement, dated as
of August 25, 1997, by and among FMC Corporation, Harsco
Corporation, Harsco UDLP Corporation and Iron Horse
Acquisition Corp.
10.2 Allocation and Contribution Agreement, dated as of August 25,
1997, by and among FMC Corporation, Harsco Corporation and
Harsco UDLP Corporation.
</TABLE>
<PAGE>
Exhibit 10.1
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SUPPLEMENTAL AGREEMENT NO. 1 TO PURCHASE AGREEMENT
--------------------------------------------------
THIS SUPPLEMENTAL AGREEMENT NO. 1 TO PURCHASE AGREEMENT (this
"Agreement"), dated as of August 25, 1997, is entered into by and among FMC
Corporation, a Delaware corporation, Harsco Corporation, a Delaware corporation,
Harsco UDLP Corporation, a Pennsylvania business corporation (together with FMC
Corporation and Harsco Corporation, "Sellers"), and Iron Horse Acquisition
Corp., a Delaware corporation ("Buyer"). Capitalized terms used and not
otherwise defined in Section 6 below or otherwise herein have the meaning
ascribed to such terms in the Purchase Agreement (as defined below).
WHEREAS, Sellers and Buyer are parties to a Purchase Agreement (the
"Purchase Agreement"), dated as of the date hereof;
WHEREAS, this Agreement contemplates the issuance of a Special Note
under certain specified circumstances, which Special Note is intended to provide
Buyer security against any Loss resulting from a Call Election, a Liquidation
Election, a Purported Turkish Termination, a Joint Venture Termination, a
License Agreement Termination or other Adverse Legal Consequences (collectively,
"Loss Events" and each, a "Loss Event") as applicable, but which is not intended
to provide any compensation or security with respect to any Losses resulting
from any other factors, including the performance of UDLP or FNSS, changes
within SSM and/or the government of Turkey and the scheduled expiration of the
Turkish Procurement Contract; and
WHEREAS, Sellers and Buyer intend this Agreement to supplement and
modify the terms of the Purchase Agreement.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties to this Agreement hereby agree as
follows:
1. Modification of the Initial Purchase Price. Pursuant to Section
1(b) of the Purchase Agreement, the Initial Purchase Price is $850,000,000
payable in immediately available funds at the Closing. Notwithstanding the
terms of Section 1(b) of the Purchase Agreement, and any other provision of the
Purchase Agreement to the contrary, Sellers and Buyer hereby agree that unless
Sellers have obtained a Nurol Waiver and a Turkish Acknowledgment prior to the
Closing, the Initial Purchase Price shall be modified to consist of (i)
$800,000,000 payable in immediately available funds at the Closing and (ii) a
note in the aggregate principal amount of $50,000,000, in form and substance
reasonably satisfactory to Sellers and Buyer, containing the terms and
conditions specified on Exhibit A hereto (the "Special Note") deliverable to
Sellers at the Closing.
2. Mandatory Prepayment of Special Note. Upon the first to occur of
any of the following events, the aggregate principal amount outstanding under
the Special Note and all accrued and unpaid interest thereon will become
immediately due and payable, subject to the rights of set-off in Section 3:
<PAGE>
(a) the occurrence of both (i) a Nurol Waiver or a Nurol Revocation
and (ii) a Turkish Acknowledgment;
(b) the consummation of an initial public offering of shares of common
equity interests or other securities equivalent thereto of UDLP;
(c) the consummation of (i) the sale of UDLP to one or more parties
pursuant to which such party or parties acquire greater than 50% of the
equity interests, capital stock or other securities of UDLP (whether by
merger, consolidation, sale or transfer of equity interests, capital stock
or other securities or otherwise) or (ii) the sale of all or substantially
all of UDLP's assets, in either case whether in one transaction or a series
of related transactions;
(d) the consummation of a sale of all or substantially all of UDLP's
Turkish business or UDLP's interests in FNSS not pursuant to a Call or a
Liquidation;
(e) the consummation of the Call pursuant to the terms of Section 11.4
of the Joint Venture Agreement; and
(f) the substantial completion of the Liquidation pursuant to the
terms of Section 11.4 of the Joint Venture Agreement.
3. Right of Set-Off. Upon the maturity of the Special Note, whether
at scheduled maturity or pursuant to the mandatory prepayment provisions of
Section 2 or pursuant to acceleration (the "Set-Off Date"), Buyer shall have the
right to assert a set-off against any and all amounts due under the Special Note
the amount of any Loss that Buyer shall have incurred as a result of a Loss
Event. If Buyer desires to assert such a Loss, Buyer shall provide to Sellers
(as soon as possible, and in any event within 30 days after the Set-Off Date in
the case of a mandatory prepayment of the Special Note or acceleration and on or
before the Set-Off Date in the case of scheduled maturity) a written statement
(a "Set-Off Statement") setting forth in reasonable detail the amount of any
asserted Loss, the basis of Buyer's asserted right to set-off of any such Loss
and a detailed statement of how any such Loss is a result of a Loss Event.
Sellers may contest the amount or validity and propriety of any item of Loss set
forth on the Set-Off Statement by giving written notice thereof to Buyer within
60 days after receipt of the Set-Off Statement. No amount of Loss specified on
any Set-Off Statement shall be valid or proper unless it is set forth in
reasonable detail on such Set-Off Statement, and the amount of any Loss on any
such Set-Off Statement not contested by Sellers in such a written notice of
Sellers shall be conclusively deemed to be valid and proper. The amount of any
Loss specified in a Set-Off Statement which is so contested shall be resolved
pursuant to the arbitration provisions set forth on Schedule 29(b) of the
Purchase Agreement. In determining the existence or amount of a Loss, the
arbitrators will be entitled to take into account any substituted business of
UDLP or its Affiliates in Turkey which in reality offsets or compensates UDLP
for any Loss resulting from a Loss Event. Interest shall continue to accrue on
the principal amount of the Special Note which was not paid based on any Loss
specified in a Set-Off Statement which is subject to arbitration as provided
above and shall be payable to Sellers if and when such amount is determined to
have not been properly set-off but shall not be payable with respect to any such
amount which is determined to have been properly set-off.
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<PAGE>
4. Limitations on Right of Set-Off. Notwithstanding anything to the
contrary in Section 3 above, the right of Buyer to a set-off as specified in
Section 3 above is subject to the following limitations. If there has occurred
a Purported Turkish Termination and subsequently, in any final and non-
appealable adjudication, it is determined by a court, agency or other tribunal
of competent jurisdiction that such Purported Turkish Termination was
impermissible, wrongful, unlawful or otherwise improper, then the amount of Loss
set-off in connection with the applicable Set-Off Statement shall be
redetermined by the arbitrators pursuant to the arbitration provisions set forth
on Schedule 29(b) of the Purchase Agreement and any reduction shall be paid
(with accrued interest thereon) to Sellers.
5. Covenants.
(a) In anticipation of or in the event of a Loss Event, Sellers shall
have the right to participate in any and all negotiations, discussions,
meetings and other communications relating to the Loss Event or potential
Loss Event, as applicable, and shall have the right to approve of any and
all settlements, agreements or other arrangements made in connection
therewith (such approval not to be unreasonably withheld or delayed).
(b) In anticipation of or in the event of a Loss Event, subject to
Seller's rights pursuant to clause (a) above, Buyer shall and shall cause
its Affiliates to use all commercially reasonable efforts to (a) obtain a
Nurol Revocation in the most cost-effective and expeditious manner
practicable (provided that the costs thereof to UDLP or Buyer shall
constitute a loss subject to rights of set-off) and (b) otherwise act in
good faith to minimize any Loss in respect of any such Loss Event.
(c) Buyer and UDLP will use all commercially reasonable efforts to
maximize the value (exclusive of any rights of set-off under this
Agreement) of UDLP's Turkish business and FNSS, whether or not in
connection with either a Call or a Liquidation, as applicable, including
(if required under appropriate circumstances) permitting the assignment of
FNSS's rights under the Manufacturing License Agreement (other than to a
competitor of UDLP) and/or extending the term of the Manufacturing License
Agreement on commercially reasonable terms.
(d) Buyer shall deliver to Sellers at Buyer's sole cost and expense
(so long as Sellers hold any portion of the outstanding principal amount of
the Special Note or so long as any arbitration proceeding contemplated by
Section 3 above is not finally resolved, whichever is later, and in the
form regularly prepared in the ordinary course):
(i) as soon as available after the end of each monthly accounting
period in each fiscal year, unaudited statements of income and cash
flows of FNSS for such monthly period and for the period from the
beginning of the fiscal year to the end of such month, and unaudited
balance sheets of FNSS as of the end of such monthly period;
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<PAGE>
(ii) within 90 days after the end of each fiscal year, statements
of income and cash flows of FNSS for such fiscal year, and balance
sheets of UDLP's Turkish business and/or FNSS as of the end of such
fiscal year;
(iii) promptly upon receipt thereof, any additional reports,
management letters or other detailed information concerning
significant aspects of FNSS' operations or financial affairs given to
Buyer or UDLP by their independent accountants (and not otherwise
contained in other materials provided hereunder);
(iv) an annual budget with respect to FNSS for each fiscal year
as and when prepared in the ordinary course, and promptly upon
preparation thereof any other significant budgets prepared by UDLP
with respect thereto;
(v) with reasonable promptness, such other information and
financial data concerning FNSS as Sellers may reasonably request.
(e) So long as Sellers hold any portion of the outstanding principal
amount of the Special Note or so long as any arbitration proceeding
contemplated by Section 3 above is not finally resolved, whichever is
later, Sellers shall be entitled at their election to designate one person
to serve as an observer at meetings of the board of directors of FNSS and
Buyer shall use its reasonable best efforts to permit such person to attend
all meetings of the board of directors of FNSS.
6. Definitions. As used in this Agreement (including the Exhibits
hereto), the following definitions shall apply:
"Adverse Legal Consequences" shall mean Losses to Buyer or UDLP, under
Turkish law or the Turkish Contracts, resulting from or caused by the change of
control and ownership at Closing without the prior consent of SSM or Nurol.
"Call" means the sale by UDLP of all of the shares of FNSS owned by it
to Nurol pursuant to the provisions of Section 11.4(iii) and 11.4(A) of the
Joint Venture Agreement.
"Call Election" means the delivery of written notice within the time
periods permitted by the Joint Venture Agreement by Nurol to UDLP indicating
that Nurol has exercised its rights under Section 11.4(iii) and Section 11.4(A)
of the Joint Venture Agreement with respect to the Call.
"FNSS" means FMC-Nurol Savunma Sanayii A.S. and its successors.
"Joint Venture Agreement" means the Restated Joint Venture Agreement
of FMC-Nurol Savunma Sanayii A.S., as amended by Amendment 1 to the Restated
Joint Venture Agreement dated July 1, 1997.
"License Agreement Termination" shall mean the termination of the
Manufacturing License Agreement pursuant to Article IX.A thereof as a result of
the change of control and
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<PAGE>
ownership effected by Closing (it being understood that UDLP will not permit
FNSS to terminate the Manufacturing License Agreement so long as UDLP remains in
control of FNSS).
"Liquidation" means the liquidation and dissolution of FNSS pursuant
to the provisions of Section 11.4(iii) and 11.4(B) of the Joint Venture
Agreement.
"Liquidation Election" means the delivery of written notice within the
time periods permitted by the Joint Venture Agreement by Nurol to UDLP
indicating that Nurol has exercised its rights under Section 11.4(iii) and
Section 11.4(B) of the Joint Venture Agreement with respect to the Liquidation.
"Loss" means a diminution in value, if any, of UDLP's equity interest
in FNSS or other Turkish business interests, taking into account any related
royalties, management fees or other payments or distributions received or to be
received, including as a result of a Call or a Liquidation, taken as a whole and
on a going-concern basis, from the date hereof to the applicable measurement
date, as a result of a Loss Event, and any diminution in value of UDLP's Turkish
business interests due to a License Agreement Termination, and any costs or
expenses incurred by UDLP or Buyer to obtain a Nurol Waiver, Nurol Revocation or
Turkish Acknowledgment or to avoid or mitigate Loss from a Loss Event, but shall
not include any Losses as a result of any other unrelated factors, including the
performance of UDLP or FNSS, changes within SSM and/or the government of Turkey
and the scheduled expiration of the Turkish Procurement Contract.
"Manufacturing License Agreement" means the Manufacturing License
Agreement, dated August 3, 1989, by and between UDLP and FNSS, as amended.
"Nurol" means Nurol Inasaat ve Ticaret A.S. and its successors.
"Nurol Revocation" means, after delivery by Nurol to UDLP of a Call
Election or a Liquidation Election, (i) a written agreement of Nurol that it
will not pursue the Call or the Liquidation, as applicable, and (ii) the earlier
of the expiration or waiver of any rights to make a Termination Election or the
passage of 365 days after Closing where Nurol has not made a Termination
Election.
"Nurol Waiver" means either (i) a written agreement of Nurol that it
will make neither a Call Election nor a Liquidation Election nor a Termination
Election or (ii) (x) the passage of one hundred twenty days after Closing
without Nurol having made a Call Election or a Liquidation Election and (y) the
earlier of the expiration or waiver of any rights to make a Termination Election
or the passage of 365 days after Closing where Nurol has not made a Termination
Election.
"Purported Turkish Termination" means a written notice delivered to
UDLP by SSM or its agent stating that SSM has canceled the Turkish Procurement
Contract pursuant to Section 19.1.3 of the Turkish Procurement Contract as a
result of the change of control and ownership effected at Closing.
"SSM" means the Under Secretariat for Defense Industries of Turkey.
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<PAGE>
"Termination Election" shall mean an election by Nurol to terminate
the Joint Venture Agreement pursuant to Article 18 thereof as a result of the
change of control and ownership effected by the Closing.
"Turkish Acknowledgment" means either (i) a letter or other writing
from SSM acknowledging the transaction between Sellers and Buyer that evidences
the intention of SSM to continue the Turkish Production Contract despite the
change of ownership and control effected by the Closing or (ii) the passage of
365 days after Closing where SSM has not made a Purported Turkish Termination.
"Turkish Contracts" shall mean the Turkish Procurement Contract, the
Manufacturing License Agreement and the Joint Venture Agreement, collectively.
"Turkish Procurement Contract" means the Contract between the Under
Secretariat for Defense Industries and FNSS.
"UDLP" means United Defense, L.P. and its successors.
7. Amendment and Waiver. No modification, amendment or waiver of
any provision of this Agreement shall be effective against any party hereto
unless such modification, amendment or waiver is approved in writing by such
party. The failure of any party hereto to enforce any of the provisions of this
Agreement shall in no way be construed as a waiver of such provisions and shall
not affect the right of such party thereafter to enforce each and every
provision of this Agreement in accordance with its terms.
8. Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
the validity, legality or enforceability of any other provision of this
Agreement in such jurisdiction or affect the validity, legality or
enforceability of any provision in any other jurisdiction, but this Agreement
shall be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been contained herein.
9. Entire Agreement. Except as otherwise expressly set forth
herein, this Agreement embodies the complete agreement and understanding among
the parties hereto with respect to the subject matter hereof and supersedes and
preempts any prior understandings, agreements or representations by or among the
parties, written or oral, which may have related to the subject matter hereof in
any way.
10. Successors and Assigns. Except as otherwise provided herein,
this Agreement shall bind and inure to the benefit of and be enforceable the
respective successors and assigns of each of the parties hereto.
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<PAGE>
11. Counterparts. This Agreement may be executed in multiple
counterparts (including by means of telecopied signature pages), each of which
shall be an original and all of which taken together shall constitute one and
the same agreement.
12. Notices. Any notice provided for in this Agreement shall be in
writing and shall be either personally delivered, or mailed first class mail
(postage prepaid) or sent by reputable overnight courier service (charges
prepaid) to any party hereto at the address indicated in the Purchase Agreement,
or at such address or to the attention of such other person as the recipient
party has specified by prior written notice to the sending party. Notices shall
be deemed to have been given hereunder when delivered personally, three days
after deposit in the U.S. mail and one day after deposit with a reputable
overnight courier service.
13. Governing Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of Illinois, without giving
effect to any choice of law or conflict of law rules or provisions (whether of
the State of Illinois or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Illinois.
14. Descriptive Headings; Interpretation. The descriptive headings
and captions of this Agreement are inserted for convenience only and do not
constitute a part of this Agreement. The use of the word "including" herein
shall mean "including without limitation."
15. Sole Remedy. The rights of set-off as provided in this Agreement
shall be the exclusive right and remedy of Buyer for any alleged Loss resulting
from any Loss Event (it being understood, however, that Buyer shall only be
entitled to a set-off under the circumstances, in the events contemplated by and
pursuant to the provisions of Sections 3 and 4 above). Other than as set forth
in this Agreement, Sellers shall have no liability whatsoever for any amount
claimed to be set-off pursuant to the terms of this Agreement or in excess of
the amount, if any, available to be set-off hereunder from time to time.
* * * * *
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have entered into this
Agreement as of the date first written above.
FMC CORPORATION
By: /s/ J. Paul McGrath
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Its: Senior Vice President
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HARSCO CORPORATION
By: /s/ Leonard A. Campanaro
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Its: Senior Vice President & C.F.O.
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HARSCO UDLP CORPORATION
By: /s/ Leonard A. Campanaro
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Its: Treasurer
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IRON HORSE ACQUISITION CORP.
By: /s/ Allan M. Holt
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Its: President
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<PAGE>
EXHIBIT A -- TERMS OF THE SPECIAL NOTE
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Borrower: The entity that issues the Senior Debt and Senior Notes.
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Principal Amount: $50,000,000
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Maturity: The final maturity of the Special Note shall be 3 years
- -------- from the Closing Date.
Ranking: The payment of principal of, premium, if any, and interest
- ------- on the Special Note will be subordinate and subject in right
of payment to all existing and future Senior Indebtedness
(to be defined) and pari passu in right of payment with all
other senior subordinated or subordinated indebtedness of
Borrower. Initially Senior Indebtedness will consist
principally of Borrower's bank facility and subordinated
indebtedness will consist principally of $225 million of
senior subordinated notes (the "Senior Notes"), and the
parties will agree to appropriate protections to preserve
equivalent type of ranking in connection with future debt
incurrences.
Guaranties: Each person who guarantees Borrower's Senior Notes (each a
- ---------- "Guarantor" and, collectively, the "Guarantors") shall be
required to provide a guaranty of all amounts owing under
the Special Note (the "Guaranties"), equivalent in ranking
and terms to the Guarantees of the Sub Debt.
Interest Rates: Outstanding principal on the Special Note shall bear
- -------------- interest at the same rate per annum as the Senior Notes, and
shall be payable quarterly in arrears on the last business
day of each calendar quarter. Interest will also be payable
at the time of repayment of the Special Note and at
maturity.
Covenants: The Special Note will have substantially the same covenants
- --------- and default provisions as the Senior Notes; provided,
however, that the maturity of the Special Note may be
accelerated only in the event of acceleration of the Senior
Debt and the Senior Notes.
Subordination: As required by senior lenders (equivalent to the Senior
- ------------- Notes).
<PAGE>
Exhibit 10.2
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ALLOCATION AND CONTRIBUTION AGREEMENT
This ALLOCATION AND CONTRIBUTION AGREEMENT (this "Agreement") is
entered into as of August 25, 1997, by and among FMC Corporation ("FMC") and
Harsco Corporation and Harsco UDLP Corporation (collectively, the "Harsco
Indemnitors"). FMC and the Harsco Indemnitors are hereafter sometimes
collectively referred to as the "Indemnitors", and each individually as an
"Indemnitor," and FMC and the Harsco Indemnitors (collectively as one party) are
each referred to herein as a "Party". Capitalized terms used herein but not
defined herein shall have the respective meanings given to such terms in the
Purchase Agreement (defined below).
WHEREAS, FMC is the sole owner and holder of 100% of the outstanding
general partnership interests of United Defense, L.P., a Delaware limited
partnership ("UDLP") and Harsco UDLP Corporation is the sole owner and holder of
100% of the outstanding limited partnership interests of UDLP;
WHEREAS, as the general partner of UDLP, FMC has had the principal
responsibility for the management and operation of UDLP;
WHEREAS, the Indemnitors have determined that it is in their
respective best interests, and in the best interests of UDLP, to sell the
general partnership and limited partnership interests together and to give joint
and several representations, warranties and covenants to the buyer of such
interests in connection therewith;
WHEREAS, contemporaneously herewith the Indemnitors are entering into
a Purchase Agreement (the "Purchase Agreement") dated as of August 25, 1997 with
Iron Horse Acquisition Corp. (the "Buyer") pursuant to which the Buyer is
agreeing to acquire all of the partnership interests in UDLP;
WHEREAS, pursuant to certain provisions of the Purchase Agreement, the
Indemnitors are required to make certain payments to the Buyer and/or UDLP and
the Indemnitors have agreed, subject to the terms and conditions set forth
therein, to jointly and severally indemnify, defend and hold the Buyer
Indemnitees harmless from and in respect of certain Losses;
WHEREAS, to induce each Party to enter into the Purchase Agreement and
to consummate the transactions contemplated thereby, the other Party is making
herein certain representations, warranties and covenants, on which the Party
benefitting from such representations, warranties and covenants is and will be
relying in entering into the Purchase Agreement and consummating the
transactions contemplated thereby;
WHEREAS, without limiting the generality of the foregoing recital, the
Harsco Indemnitors are joining with FMC in certain joint and several
representations, warranties and
<PAGE>
covenants in the Purchase Agreement and the other Ancillary Agreements in
reliance on the representations, warranties and covenants of FMC contained in
this Agreement;
WHEREAS, pursuant to certain provisions of the Purchase Agreement, the
Indemnitors make certain representations, warranties and covenants to the Buyer,
and the Indemnitors have agreed, subject to the terms and conditions set forth
therein, to indemnify, defend and hold the Buyer Indemnitees (as defined below)
harmless from and in respect of certain Losses;
WHEREAS, pursuant to certain provisions of the Purchase Agreement,
Buyer and/or UDLP is required to make certain payments to Sellers, and Buyer has
agreed, subject to the terms and conditions set forth therein, to indemnify,
defend and hold the Seller Indemnitees (as defined below) harmless from and in
respect of certain Losses; and
WHEREAS, in connection with the sale of UDLP pursuant to the Purchase
Agreement and the consequent termination of their relationship as partners of
UDLP, the Indemnitors wish to make certain agreements among themselves relating
to the past conduct of UDLP's business.
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual promises made herein and for other good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged, and intending to be
legally bound hereby, the Indemnitors agree as follows:
1. Certain Definitions.
-------------------
"Buyer Indemnitees" shall mean the Buyer Indemnified Parties.
"FMC Covenants" means the covenants contained in the following
Sections of the Purchase Agreement: Section 2(b)(iv), Section 5 (but excluding
Sections 5(c), 5(e), 5(f) and 5(j)), Sections 8(a), 8(d), 8(e), 8(h), 10(d),
10(i)(i), 10(j) and, except to the extent that the context otherwise clearly
requires and except to the extent that the performance of such covenant is
peculiarly within the control of Harsco (as opposed to FMC), all other covenants
in the Purchase Agreement (other than the Several Covenants) that make reference
to Sellers or a Seller but which do not identify either FMC or Harsco by name.
"FMC Representations" means (i) all representations and warranties
relating to FMC's Corporate Technology Center ("CTC") and (ii) the
representations and warranties contained in Sections 4A and 23 (as it relates to
FMC and its affiliates) and all other representations of a Seller in the
Purchase Agreement (other than the Shared Representations) that make reference
to Sellers or a Seller but which do not identify either FMC or Harsco by name.
"Harsco Representations" means the representations and warranties
contained in Sections 4B and 23 (as it relates to Harsco and its affiliates).
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"Pro Rata Portion" means 60% in the case of FMC and 40% in the case of the
Harsco Indemnitors.
"Seller Indemnitees" shall mean each Indemnitor, each of its Affiliates and
each of their respective officers, directors and employees.
"Several Covenants" means the covenants contained in the following Sections
of the Purchase Agreement: Sections 1(b), 1(c), 2(a), 2(b)(ii), 5(c), 5(e),
5(f), 5(j), 7(f), 8(b), 8(c), 8(f)(iii), 8(g)(ii), 8(i), 8(n), 8(p), 9, 10(a),
10(b), 10(e), 10(f), 10(h), 10(j)(ii), 10(k) (to the extent required in the case
of Harsco), 12, 16 and 29.
"Shared Representations" means the representations and warranties contained
in Section 4C(a)(i), 4C(b), 4C(d) (excluding those relating to the Latest
Financials), 4C(e), 4C(f), 4C(g), 4C(l) and 4C(n) (excluding those matters
subject to Section 8(f) of the Purchase Agreement) of the Purchase Agreement.
2. Representations and Warranties of the Harsco Indemnitors. Each of the
Harsco Indemnitors jointly and severally represents and warrants to FMC as of
the date of this Agreement as follows:
2.1 Authorization. This Agreement constitutes the valid and legally
binding obligation of such Harsco Indemnitor, enforceable against such Harsco
Indemnitor in accordance with its terms and conditions, except as may be limited
by (a) applicable bankruptcy, reorganization, insolvency, moratorium or other
similar laws affecting the enforcement of creditors' rights generally from time
to time in effect and (b) the effect of general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or at
law).
2.2 Non-contravention. Neither the execution and the delivery of
this Agreement by such Harsco Indemnitor, nor the performance by such Harsco
Indemnitor of its obligations hereunder, will (i) violate any constitution,
statute, regulation, rule, injunction, judgment, order, decree, ruling, charge
or other restriction of any government, governmental agency or court to which
the Harsco Indemnitor is subject or any provision of its organizational
documents or (ii) conflict with, result in a breach of, constitute a default
under, result in the acceleration of, or create in any party the right to
accelerate, terminate, modify, cancel or require any notice under any agreement,
contract, lease, license, instrument or other arrangement to which the Harsco
Indemnitor is a party or by which such Harsco Indemnitor is bound or to which
any of such Harsco Indemnitor's assets are subject except for such conflicts,
breaches, defaults, or rights that would not, individually or in the aggregate,
be reasonably likely to have a material adverse effect upon the financial
condition of such Harsco Indemnitor.
2.3 Consents. No consent, authorization, approval, permit or license
of, or filing with, any governmental or public body or authority, any lender or
lessor or any other person or entity is required to be obtained or made by any
Harsco Indemnitor to authorize, or is required to be obtained or made by any
Harsco Indemnitor in connection with, the execution, delivery and
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performance of this Agreement or the agreements contemplated hereby on the part
of such Harsco Indemnitor (other than those that have been obtained or made).
3. Representations and Warranties of FMC. FMC represents and warrants to
the Harsco Indemnitors as of the date of this Agreement as follows:
3.1 Authorization. This Agreement constitutes the valid and legally
binding obligation of FMC, enforceable against FMC in accordance with its terms
and conditions, except as may be limited by (a) applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws affecting the
enforcement of creditors' rights generally from time to time in effect and (b)
the effect of general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
3.2 Non-contravention. Neither the execution and the delivery of
this Agreement by FMC, nor the performance by FMC of its obligations hereunder,
will (i) violate any constitution, statute, regulation, rule, injunction,
judgment, order, decree, ruling, charge or other restriction of any government,
governmental agency or court to which FMC is subject or any provision of its
organizational documents or (ii) conflict with, result in a breach of,
constitute a default under, result in the acceleration of, or create in any
party the right to accelerate, terminate, modify, cancel or require any notice
under any agreement, contract, lease, license, instrument or other arrangement
to which FMC is a party or by which FMC is bound or to which any of FMC's assets
are subject except for such conflicts, breaches, defaults, or rights that would
not, individually or in the aggregate, be reasonably likely to have a material
adverse effect upon the financial condition of FMC.
3.3 Consents. No consent, authorization, approval, permit or license
of, or filing with, any governmental or public body or authority, any lender or
lessor or any other person or entity is required to be obtained or made by FMC
to authorize, or is required to be obtained or made by FMC in connection with,
the execution, delivery and performance of this Agreement or the agreements
contemplated hereby on the part of FMC (other than those that have been obtained
or made).
3.4 Purchase Agreement. FMC has provided to the Harsco Indemnitors
all agreements and understandings between or among the Buyer and FMC and UDLP
relating to the sale of UDLP.
3.5 Representations and Warranties Relating to the Purchase
Agreement. Certain of the representations and warranties contained in the
Purchase Agreement and other Ancillary Agreements are given jointly and
severally by the Sellers, including without limitation certain representations
and warranties relating to FMC's Corporate Technology Center. Notwithstanding
anything in the Purchase Agreement or in any Ancillary Agreement to the
contrary, the Parties agree that as an inducement to the Harsco Indemnitors to
enter into the Purchase Agreement and the Ancillary Agreements, FMC will be
solely responsible for the truth, correctness and completeness of the FMC
Representations and the Shared Representations except to the extent any Harsco
Indemnitor is responsible pursuant to Section 6.2(a) hereof and except to the
extent any Harsco
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Indemnitor had actual knowledge of the breach of such representation or warranty
prior to the date hereof.
4. Additional Covenants of FMC.
4.1 Covenants in the Purchase Agreement and Ancillary Agreements.
Certain of the covenants contained in the Purchase Agreement and other Ancillary
Agreements are given jointly and severally by the Sellers on behalf of UDLP.
Notwithstanding anything in the Purchase Agreement or in any Ancillary Agreement
to the contrary, it is the intention of the Parties, and is an inducement to the
Harsco Indemnitors to enter into the Purchase Agreement and the Ancillary
Agreements, that FMC be solely responsible for performing, satisfying,
discharging and complying with, or for causing UDLP to perform, satisfy,
discharge and comply with all of the FMC Covenants. FMC hereby agrees that it
will be solely responsible for performing, satisfying, discharging and complying
with, or for causing UDLP to perform, satisfy, discharge and comply with all of
the FMC Covenants.
4.2 Intercompany Loans. FMC shall repay in full all outstanding
intercompany obligations between it and UDLP or any of the Subsidiaries at or
prior to the Closing, except as otherwise provided in Section 5(h) of the
Purchase Agreement.
4.3 Representations and Warranties; Performance of Obligations. On
the Closing Date, FMC shall deliver a certificate to the Harsco Indemnitors to
the same effect as the certificate required to be delivered by FMC to the Buyer
pursuant to Section 3(a) of the Purchase Agreement (if such certificate is
delivered).
4.4 File Plan. FMC will include in any File Plan delivered pursuant
to Section 8(g)(ii) of the Purchase Agreement any items requested by Harsco.
5. Additional Covenants of the Harsco Indemnitors.
5.1 Representations and Warranties; Performance of Obligations. On
the Closing Date, the Harsco Indemnitors shall deliver a certificate to FMC to
the effect that all of the representations and warranties of the Harsco
Indemnitors contained in this Agreement are true, correct and complete on and as
of the Closing Date with the same effect as though such representations and
warranties had been made on and as of such date and that all of the terms,
covenants, agreements and conditions of this Agreement to be complied with,
performed or satisfied by the Harsco Indemnitors on or before the Closing Date
have been duly complied with performed or satisfied in all material respects.
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6. Contribution.
6.1 Payments in Respect of San Jose/Santa Clara Remediation Costs,
Stock Options and Restricted Stock and CTC and Transferred Employees; Buyer
Note.
(a) At or before the Closing, FMC shall pay to the Harsco Indemnitors
$2,492,160 to pay certain Remediation Costs relating to the Sites covered
by the Settlement and Advance Agreement, which costs are likely to be
incurred and payable by FMC and reimbursable by the Buyer pursuant to the
terms of the Purchase Agreement.
(b) Within two business days after the Closing, the Harsco Indemnitors
shall pay FMC 40% of the Agreed Value of (i) the unexercised FMC stock
options issued to UDLP executives and employees in 1994 and 1995 which are
either currently vested or scheduled to vest on or prior to January 31,
1998 (all of which options are listed on Exhibit A hereto, which listing
includes as to each such option, the name of the optionee, the year of
grant, the exercise price and the number of Shares subject thereto) and
(ii) certain shares of the FMC restricted stock issued to UDLP executives
and employees subsequent to January 1, 1994 (which will become unrestricted
upon the Closing) (all of which shares are listed on Exhibit A hereto,
which listing includes as to each recipient, the name of the recipient, the
date of grant, the closing trading price of FMC common stock on the date of
grant, and the number of shares granted, and provided that FMC represents
that such listing does not include, as to Mr. Rabaut, any shares granted on
account of his position at FMC). For purposes of the foregoing, "Agreed
Value" means the market value of the shares of FMC common stock issuable
under such options less the aggregate exercise price and the market value
of the shares of restricted stock (without restriction), in each case as
calculated based on the closing trading price of the FMC common stock on
the Closing Date or, in the case of restricted stock, on the date of grant
as reported in the Wall Street Journal.
(c) The net effect upon the net worth adjustment contained in Section
2(b) of the Purchase Agreement of the impact of including CTC and the
Transferred Employees as part of the accounts reflected in the Adjusted Net
Worth Amount as of both June 30, 1997 and the Closing Date (the "CTC
Adjustment Amount") shall be separately calculated by FMC in connection
with the preparation of the Closing Statement and provided to Harsco with
the Closing Statement. Harsco shall have the right, with FMC's full
cooperation, to review and audit FMC's calculation of the CTC Adjustment
Amount. If the CTC Adjustment Amount is negative, FMC shall pay 40% of
such amount to Harsco. If the CTC Adjustment is positive, Harsco shall pay
40% of such amount to FMC. Any such payments shall be made as soon as
possible after they are determined and shall be appropriately adjusted if
the relevant accounts are adjusted in connection with the finalization of
the Closing Statement. Amounts payable hereunder shall bear interest from
the Closing Date at the rate provided in Section 2(b)(ii) of the Purchase
Agreement.
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(d) FMC shall pay to the Harsco Indemnitors 40% of any amounts
collected in respect of the FNSS royalty dispute (as more specifically
described in Schedule 7(f) to the Purchase Agreement the "FNSS Royalty
Dispute"), to the extent such amounts are attributable to periods following
the formation of UDLP.
(e) Notwithstanding anything to the contrary in the Supplemental
Agreement No. 1 to Purchase Agreement, dated as of August 25, 1997, by and
among FMC Corporation, Harsco Corporation, Harsco UDLP Corporation and Iron
Horse Acquisition Corp. (the "Supplemental Agreement") or in the provisions
of the Special Note (as defined therein), as between the Harsco Indemnitors
and FMC, (i) the Harsco Indemnitors shall receive from the Buyer
$340,000,000 plus 40% of the Adjustment Amount (whether positive or
negative), in immediately available funds, at and upon the Closing and FMC
shall receive from the Buyer a total of $510,000,000 plus 60% of the
Adjustment Amount (whether positive or negative), in immediately available
funds, and, if issued, the Special Note and (ii) for all purposes of the
Supplemental Agreement, the term "Sellers" shall mean FMC, except in the
case of Section 5(a) thereof, in which "Sellers" shall mean FMC and the
Harsco Indemnitors. The Harsco Indemnitors shall pay to FMC in
immediately available funds, within three business days following the later
of (A) the maturity of the Special Note (whether at scheduled maturity or
pursuant to the mandatory prepayment provisions of Section 2 of the
Supplemental Agreement or pursuant to acceleration) or (B) the final
determination of any dispute regarding the amount to be finally paid to FMC
under the Special Note, 40% of the first $25,000,000 of any Payment
Deficiency. For purposes of this Section 6.1(e), "Payment Deficiency"
means the difference between (A) $50,000,000 and (B) the principal amount
of the Special Note actually paid to FMC after set-off, if any, by Buyer.
For example, if the amount collected by FMC on the Special Note is
$40,000,000, then the amount that the Harsco Indemnitors shall pay to FMC
pursuant to this Section 6.1(e) shall be $4,000,000, and if the amount
collected by FMC on the Special Note is $20,000,000, then the amount that
the Harsco Indemnitors shall pay to FMC pursuant to this Section 6.1(e)
shall be $10,000,000. FMC will use its commercially reasonable best
efforts to obtain the Nurol Waiver and the Turkish Acknowledgment (each as
defined in the Supplemental Agreement), and the Harsco Indemnitors will
have the right to participate in such efforts led by FMC. In the event of
any dispute between FMC and the Buyer with respect to payment on the
Special Note, FMC shall not agree to any settlement of any such dispute
that would have an adverse effect on the Harsco Indemnitors without first
consulting with the Harsco Indemnitors and obtaining the written consent of
the Harsco Indemnitors (which consent shall not be unreasonably withheld or
delayed). In addition, in the event of any litigation concerning any such
dispute, FMC will keep the Harsco Indemnitors advised of all material
developments in such litigation, and the Harsco Indemnitors shall have the
right to join with FMC in such litigation at the sole expense of the Harsco
Indemnitors.
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6.2 Payments in Respect of Indemnification.
(a) Each Party will contribute its Pro Rata Portion of all joint
obligations under the Purchase Agreement, as defined in clauses (i) through
(ix) below, in accordance with the following sentence (the "Joint
Obligations"). Each Party's contribution obligations under this paragraph
6.2(a) shall be limited to such Party's Pro Rata Portion of the aggregate
Loss suffered or sustained by both Parties, after taking into account any
indemnifiable Loss suffered by such Party, in order that both Parties
ultimately bear their Pro Rata Portion of such aggregate Loss. Each Party
agrees to indemnify and hold harmless the other Party against the amount of
any Loss which the other Party may suffer, sustain or become subject to in
excess of such Party's Pro Rata Portion of such Loss, in the event that the
other Party becomes (or any third party asserts that such other Party is)
liable or otherwise responsible. For the purposes of this Agreement, Joint
Obligations means:
(i) any obligation of the Sellers under Section 8(f)(iii) of the
Purchase Agreement, to the extent that it relates to:
(A) post-1993 operation of UDLP,
(B) subject to clause (iii)(A) of Section 6.2(b) below,
environmental conditions which are discovered at York subsequent
to December 31, 1998 and not proven by FMC to have been a Harsco
Environmental Liability Event (as defined in the Participation
Agreement) or
(C) properties acquired or first used by UDLP subsequent to
its formation,
(ii) any indemnification obligation of Sellers:
(A) under Section 10(b) (tax indemnification) of the
Purchase Agreement or
(B) under Section 11(a)(i) of the Purchase Agreement which
is based on breach of a Shared Representation; provided that, any
indemnification obligation under Section 11(a)(i) of the Purchase
Agreement which is based on a Shared Representation shall be a
Joint Obligation only to the extent that the aggregate of all
Losses suffered and paid by FMC as a result of breaches of Shared
Representations on a cumulative basis as a result of the
indemnification obligations under Section 11(a)(i) of the
Purchase Agreement exceed $10,000,000.
(iii) any obligation of Sellers to pay their portion of the fees
and expenses of Ernst & Young L.L.P. and the Accounting Firm pursuant
to Section 2(b) of the Purchase Agreement or the escrow agent pursuant
to the Escrow Agreement,
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<PAGE>
(iv) any obligation of Sellers under Section 2(b) of the Purchase
Agreement to pay any amount by which the Estimated Final Purchase
Price exceeds the Final Purchase Price,
(v) any obligation of Sellers to pay their portion of
intellectual property recordation costs pursuant to Section 8(o) of
the Purchase Agreement,
(vi) any obligation of Sellers to pay their portion of certain
taxes pursuant to Section 10(h) of the Purchase Agreement,
(vii) any obligation of Sellers to pay a portion of any
insurance recovery pursuant to Section 8(f)(v) of the Purchase
Agreement;
(viii) any obligation of Sellers to pay the amount of any
negative Cash Balance to the Buyer pursuant to Section 8(p) of the
Purchase Agreement, or
(ix) any obligation or liability relating to UDLP listed on
Schedule 7(f) to the Purchase Agreement which is retained or assumed
on a joint basis, except for amounts payable in connection with the
FNSS Royalty Dispute which are attributable to the period prior to
formation of UDLP.
(b) FMC agrees to indemnify and hold harmless the Harsco Indemnitors
against the amount of any Loss which Harsco may suffer, sustain or become
subject to in the event that Harsco becomes (or the Buyer or any third
party asserts that any Harsco Indemnitor is) liable or otherwise
responsible for:
(i) any Losses suffered or incurred by any Harsco Indemnitor to
the extent arising from:
(A) any breach of any representation or warranty of FMC
contained herein or of any FMC Representation, except to the
extent any Harsco Indemnitor is responsible pursuant to Section
6.2(a) hereof and except to the extent any Harsco Indemnitor had
actual knowledge of the breach of such representation or warranty
prior to the date hereof,
(B) any breach of any Shared Representation, but only to the
extent that the aggregate of all Losses suffered and paid by FMC
as a result of a breach of a Shared Representation on a
cumulative basis as a result of the indemnification obligation
under Section 11(a)(i) of the Purchase Agreement does not exceed
$10,000,000 or
(C) any breach of any covenant of FMC contained herein, any
breach of any FMC Covenant or any breach by FMC of any Several
Covenant,
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(ii) any Losses suffered or incurred by any Harsco Indemnitor
arising from:
(A) any wrongful, self-dealing, grossly negligent, reckless
or bad faith conduct by FMC in connection with its conduct on
behalf of UDLP or any Harsco Indemnitor, including in connection
with the sale of FMC's Partnership Interest in UDLP or Harsco's
Partnership Interest in UDLP pursuant to the Purchase Agreement
or
(B) any failure by FMC to observe any applicable duty or
obligation to UDLP or any Harsco Indemnitor arising out of any
wrongful, self-dealing, grossly negligent, reckless or bad faith
conduct by FMC;
provided that, in the event of any claim under this clause (ii)
relating to the consideration payable or the terms and conditions of
the sale of UDLP, FMC's conduct shall be reviewed on a comparable
basis to that provided to a Delaware corporation and its directors
under the business judgment rule,
(iii) subject to clause (i)(A) of Section 6.2(a) above, any
obligation of Sellers under Section 8(f)(iii) of the Purchase
Agreement to the extent that it relates to:
(A) the first $1,000,000 that relates to environmental
conditions at UDLP's York property that Harsco would otherwise be
responsible for under clause (i) of Section 6.2(c) below,
(B) the pre-1994 operation of FMC's defense business, or
(C) properties contributed by FMC to UDLP upon its formation
and
(iv) any obligation or liability relating to UDLP which is
retained or assumed by FMC as specifically set forth in the Purchase
Agreement, including those items listed on Schedule 7(f) thereto and
all amounts payable in connection with the FNSS Royalty Dispute which
are attributable to periods prior to formation of UDLP.
For purposes of this Agreement, the actual knowledge of the Harsco Indemnitors
shall be deemed to refer only to the actual present knowledge of Derek Hathaway
and Leonard Campanaro, without such individual having conducted any inquiry or
review.
(c) The Harsco Indemnitors agree to indemnify and hold harmless FMC
against the amount of any Loss which FMC may suffer, sustain or become
subject to in the event that FMC becomes (or Buyer or any third party
asserts that FMC is) liable or otherwise responsible for:
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(i) subject to clauses (i)(A) and (i)(B) of Section 6.2(a) above
and subject to clause (iii)(A) of Section 6.2(b) above, any obligation
of Sellers under Section 8(f)(iii) to the extent that it relates to:
(A) the pre-1994 operation of Harsco's defense business or
(B) properties contributed by Harsco to UDLP upon its
formation,
(ii) any Losses suffered or incurred by FMC to the extent arising
from:
(A) any breach of any Harsco Representation or any
representation or warranty of any Harsco entity contained herein or
(B) any breach by Harsco of any Several Covenant or any
covenant of any Harsco entity contained herein and
(iii) any obligation or liability relating to UDLP which is
retained or assumed by Harsco as specifically set forth in the
Purchase Agreement, including those items listed on Schedule 7(f)
thereto.
(d) Each Party further agrees to indemnify and hold harmless the other
Party against the amount of any Loss which the other Party may suffer,
sustain or become subject to in respect of any obligation of such Party
which is, pursuant to the terms of the Purchase Agreement, a several
obligation of such Party alone and not a joint and several obligation of
the Parties.
6.3 Indemnity Procedures.
(a) Indemnity Dispute Costs. Following the Closing, the Parties will
cooperate in a commercially reasonable manner in connection with any
indemnification or other claim made by the Buyer or any third party under
the Purchase Agreement or otherwise relating to UDLP, but subject to the
provisions of the Purchase Agreement, including the provisions contained in
Section 2(b), Section 10 and Section 11(f) of the Purchase Agreement
relating to the control of the defense and management of certain
indemnification and other claims and matters by FMC. In the event that FMC
determines to dispute, defend or otherwise manage any such claim or any
other claim made by the Buyer or any third party, then FMC shall be
responsible for all of the costs, fees and expenses incurred on behalf of
FMC in connection with such dispute, defense or management (the "Indemnity
Dispute Costs"). The Harsco Indemnitors shall be responsible for all of
the costs, fees and expenses of their participation in such dispute,
defense or management.
(b) Third Party Claims. With respect to any indemnification under
this Section 7 in respect of, arising out of or involving a claim by any
Person, including the Buyer (a "Third Party Claim"), against a Party hereto
(the "Indemnified Party"), FMC must notify the
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Harsco Indemnitors of the Third Party Claim within a reasonable time after
receipt by FMC of written notice of the Third Party Claim. Thereafter, FMC
shall, within ten days of receipt thereof, deliver copies of all notices
and documents (including court papers) received by them relating to the
Third Party Claim to the Harsco Indemnitors.
(c) Defense of Third Party Claims. If a Third Party Claim is made
against an FMC Indemnified Party for a claim relating to the breach of a
representation, warranty or covenant made jointly by the Parties in the
Purchase Agreement, the Harsco Indemnitors shall be entitled to participate
in the defense thereof (a "Joint Third Party Claim"). FMC shall cooperate
in all reasonable respects with the Harsco Indemnitors in connection with
such defense, including by permitting the Harsco Indemnitors to appoint
counsel and to have such counsel observe and participate in the defense of
the Joint Third Party Claim if the Harsco Indemnitors choose at the sole
expense of the Harsco Indemnitors. In connection with all such matters,
FMC shall be available to consult with the Harsco Indemnitors as reasonably
requested concerning the management of such matters and shall consider in
good faith any comments, suggestions or proposals made by the Harsco
Indemnitors in connection therewith. FMC shall not admit any liability
with respect to, or settle, compromise or discharge, any Joint Third Party
Claim without the prior written consent of the Harsco Indemnitors (which
will not be unreasonably withheld or delayed). The management of, and all
decisions regarding (including decisions regarding settlement of) any
dispute or defense of a claim for which either FMC or the Harsco
Indemnitors are solely responsible pursuant to the terms of the Purchase
Agreement shall at all times be at the direction of and otherwise made by
the Party who bears responsibility for the claim.
6.4 Survival of Representations. The representations and warranties
in this Agreement shall survive the Closing to the same extent set forth in the
Purchase Agreement.
7. Escrow Deposit. If and when the Escrow Deposit, referred to in
the Escrow Agreement attached as Exhibit 6(c) to the Purchase Agreement is to be
paid to FMC and Harsco, it shall be allocated on a Pro Rata Basis to the
Parties.
8. Prepayment of Intercompany Debt; Allocation of Cash Distributions
and Payments. Immediately prior to the Closing, FMC shall repay all
intercompany debt owed to UDLP, together with interest accrued through the date
of repayment. Promptly following the Closing Date, FMC shall pay to the Harsco
Indemnitors (i) 100% of any amounts attributable to limited partner allocations
that accrue through the Closing (to the extent not directly distributed to
Harsco) and (ii) 40% of any other distribution or payment made by UDLP to FMC at
Closing for the ratable benefit of both partners (to the extent not directly
distributed to Harsco). The Harsco Indemnitors hereby acknowledge and agree
that any distribution or payment made by UDLP to FMC at Closing in respect of
"B" service fees that accrue through the Closing shall be retained solely by
FMC.
9. Limited Partner Consent. The Harsco Indemnitors hereby consent and
agree to the terms and provisions of the Transition Services Agreement, the
Technology and Environmental
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Services Agreement, the Amended and Restated FMC Intellectual Property
Agreement, the Amended and Restated Lease Agreement and the FMC Resource
Transfer.
10. Allocation of Expenses. Each Party hereby agrees to pay its Pro Rata
Portion of the following out-of-pocket expenses incurred by the Indemnitors in
connection with the transactions contemplated by the Purchase Agreement: (i)
costs of the preparation and filing of all UDLP Tax Returns relating to Taxes
incurred in connection with the pre-closing business and operations of UDLP or
the transactions contemplated by the Purchase Agreement and (ii) costs of the
preparation of financial statements of UDLP incurred in connection with the
transactions contemplated by the Purchase Agreement. Each Party hereby agrees
to pay its own respective costs for legal services, filing fees and regulatory
expenses incurred in order to comply with United States and foreign antitrust
and competition laws.
11. Miscellaneous.
11.1 No Third-Party Beneficiaries. This Agreement shall not confer
any rights or remedies upon any Person other than the Indemnitors and their
respective successors and permitted assigns.
11.2 Entire Agreement. This Agreement, together with the Purchase
Agreement (and the exhibits and schedules thereto) constitute the entire
agreement among the Indemnitors with respect to the subject matter hereof and
supersedes any prior understandings, agreements, or representations by or among
the Indemnitors, written or oral, to the extent they related in any way to the
subject matter hereof.
11.3 Succession and Assignment. This Agreement shall be binding upon
and inure to the benefit of the Indemnitors and their respective successors and
permitted assigns. No Indemnitor may assign either this Agreement or any of
such Indemnitor's rights, interest or obligations hereunder without the prior
written approval of the other Indemnitors.
11.4 Counterparts. This Agreement may be executed in one or more
counterparts (including by means of telecopied signature pages), each of which
shall be deemed an original but all of which together will constitute one and
the same instrument.
11.5 Headings. The section headings and captions contained in this
Agreement are inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.
11.6 Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given by a reputable
and recognized overnight delivery service (e.g. Federal Express, etc.), against
receipt thereof, by telex, by telecopier against a confirmed receipt therefor or
by mail (registered or certified mail, postage prepaid, return receipt
requested) to the respective parties as follows:
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if to FMC:
---------
FMC Corporation
200 East Randolph Drive
Chicago, Illinois 60601
Telecopy No.: (312) 861-6012
Attention: J. Paul McGrath
with a copy to:
--------------
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Telecopy No.: (312) 861-2200
Attention: Glen E. Hess, P.C.
if to the Harsco Indemnitors:
----------------------------
Harsco Corporation
350 Poplar Church Road
Camp Hill, PA 17011
Telecopy No.: (717) 763-6402
Attention: Paul C. Coppock
with a copy to:
--------------
Morgan, Lewis & Bockius LLP
1800 M Street, N.W.
Washington, D.C. 20036
Telecopy No.: (202) 467-7176
Attention: Lloyd H. Feller
or to such other address as any Indemnitor hereto may, from time to time,
designate in a written notice given in like manner. Any notice given in
accordance with the requirements of this Section 11.6 shall be deemed to have
been received when delivered in person or via telecopier against receipt
thereof, five business days after deposit in the U.S. mail against receipt
thereof, and one business day after deposit with a reputable express overnight
courier service against receipt therefor.
11.7 Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Delaware without
giving effect to any choice or conflict of law provision or rule (whether of the
State of Delaware or any other jurisdiction) that would cause the application of
the laws of any jurisdiction other than the State of Delaware.
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11.8 Amendments and Waivers. No amendment or waiver of any provision
of this Agreement shall be valid unless the same shall be in writing and signed
by all of the Indemnitors.
11.9 Severability. Any provision of this Agreement which is invalid,
illegal or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability,
without affecting in any way the remaining provisions hereof in such
jurisdiction or rendering that or any other provision of this Agreement invalid,
illegal or unenforceable in any other jurisdiction. Furthermore, in lieu of
such illegal, invalid or unenforceable provision, there shall be added
automatically as part of this Agreement a provision as similar in its terms to
such illegal, invalid or unenforceable provision as may be possible and be
legal, valid and enforceable.
11.10 Construction. The Indemnitors have participated jointly in
the negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the Indemnitors and no presumption or burden of proof
shall arise favoring or disfavoring any Indemnitor by virtue of the authorship
of any of the provisions of this Agreement. The word "including" shall mean
including without limitation. Section references used herein, unless otherwise
specified, refer to Sections of this Agreement.
11.11 Exclusive Remedy; Waiver. Subject to Section 11.2 above, the
indemnification and contribution arrangements set forth in this Agreeement
constitute the exclusive arrangement among the parties with respect to the
matters set forth herein and are in lieu of any common law rights or remedies
any party may have as a joint and several indemnitor or otherwise (except with
respect to claims for fraud). Accordingly, each party expressly waives any
right it may have, and agrees not to assert any claim for, contribution or
indemnity with respect to the matters set forth herein except as set forth
herein.
* * * * *
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<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this Allocation and
Contribution Agreement as of the date first above written.
FMC CORPORATION
By: /s/ J. Paul McGrath
----------------------------------
Name: J. Paul McGrath
--------------------------------
Title: Senior Vice President
-------------------------------
HARSCO CORPORATION
By: /s/ Leonard A. Campanaro
----------------------------------
Name: Leonard A. Campanaro
--------------------------------
Title: Senior Vice President & C.F.O.
-------------------------------
HARSCO UDLP CORPORATION
By: /s/ Leonard A. Campanaro
----------------------------------
Name: Leonard A. Campanaro
--------------------------------
Title: Treasurer
-------------------------------
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