<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report: JANUARY 14 , 1994
-----------------
ALLIED PRODUCTS CORPORATION
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(Exact name of registrant as specified in its charter)
DELAWARE
----------------------------------------------
(State or other jurisdiction of incorporation)
1-5530 38-0292230
----------------------- ---------------------
(Commission File Number) (I.R.S. Employer
Identification Number)
10 SOUTH RIVERSIDE PLAZA, SUITE 1600, CHICAGO, ILLINOIS 60606
--------------------------------------------------------------
(Address of principal executive offices) (zip code)
(312) 454-1020
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(Registrant's telephone number, including area code)
<PAGE>
ITEM 2. DISPOSITION OF ASSETS
On December 30, 1993, Allied Products Corporation ("Allied") sold
substantially all the assets and liabilities of its White-New Idea Farm
Equipment Division to AGCO Corporation, a Delaware corporation, ("AGCO") for
$53,480,636 paid in cash. The sale became effective as of December 31, 1993.
The purchase price was calculated as 110% of the net book value of the
purchased assets as of November 30, 1993 (net book value being calculated as
the book value (net of accumulated depreciation and other valuation reserves)
of the purchased assets less the assumed liabilities). The purchase price is
subject to a post-closing adjustment based upon a closing date balance sheet
to be provided by Allied to AGCO. The purchased assets include all inventory,
tooling, machinery and equipment, real property leases, intellectual property,
receivables and contract rights that are used primarily in, or that arise from,
the conduct of the White-New Idea Farm Equipment Division business.
Real estate used in connection with the White-New Idea business
(specifically, the plants located in Coldwater, Ohio and Kewanee, Illinois) is
being leased by Allied to AGCO. AGCO has options to purchase the Coldwater
and Kewanee real estate at a later time pursuant to two Contracts for the
Purchase and Sale of Real Property dated as of November 8, 1993 by and between
AGCO Corporation and Allied Products Corporation.
Allied used a substantial portion of the proceeds of the sale of
White-New Idea to retire senior secured debt.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(b)(1) Pro forma financial information
(c)(2)(a)(i) Agreement for the Sale of Assets of the White-New Idea Farm
Equipment Division of Allied Products Corporation dated as of
November 8, 1993 by and between AGCO Corporation and Allied
Products Corporation.
(ii) List of Exhibits and Disclosure Schedules to the
Agreement for the Sale of Assets.
<PAGE>
SIGNATURE
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 hereunto duly authorized.
ALLIED PRODUCTS CORPORATION
/s/ Kenneth B. Light
-----------------------------
By: Kenneth B. Light
Its: Executive Vice President
Date: January 14, 1994
<PAGE>
EXHIBIT(b)(i)
PRO FORMA FINANCIAL STATEMENTS
INTRODUCTION
The following unaudited pro forma consolidated statements of income (loss)
for the year ended December 31, 1992 and nine months ended September 30, 1993
give effect to the disposition of the White-New Idea Farm Equipment division
of Allied Products Corporation to AGCO Corporation of Norcross, Georgia. The
sale, which closed as of December 31, 1993, involves most of the division's
assets, including accounts receivable, inventories and machinery and
equipment involved in the operation of the business. Subject to certain
contingencies, the sale also includes the division's owned plant facilities
in Coldwater, Ohio and Kewanee, Illinois. This portion of the agreement is
expected to close within the next several months. Under the agreement, AGCO
also assumes certain liabilities related to the White-New Idea division.
Under the terms of the agreement, the selling price is equal to 110% of the
net book value of the assets sold less liabilities assumed.
On December 30, 1993, the Company received cash proceeds of approximately
$53,500,000 (based upon the November 30, 1993 balance sheet excluding plant
facilities described above) from AGCO Corporation. Additional cash proceeds
related to the sale of the plant facilities described above and final
determination of other account balances as of December 31, 1993 should be
received within several months. A significant portion of the proceeds
received were used to retire all of the Company's remaining senior secured
debt. Additional debt was retired with the remaining portion of the receipts.
The pro forma information is based upon the historical financial statements
of the Company giving effect to the disposition described above and
adjustments described in the accompanying notes to the unaudited pro forma
financial statements. The effect of the gain from the transaction described
above has not been included in the accompanying unaudited pro forma
consolidated statements of income (loss) for the year ended December 31, 1992
and nine months ended September 30, 1993. The attached unaudited pro forma
consolidated balance sheet gives effect to the disposition described above.
The unaudited pro forma consolidated financial statements have been prepared
by the management of the Company and may not be indicative of the results
that actually would have occurred if the disposition had occurred on the
particular dates noted on each pro forma consolidated financial statement.
The pro forma consoldiated financial statements should be read in conjunction
with the related notes contained elsewhere herein.
<PAGE>
ALLIED PRODUCTS CORPORATION AND CONSOLIDATED SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME (LOSS)
FOR THE YEAR ENDED DECEMBER 31, 1992
(IN THOUSANDS OF DOLLARS)
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
HISTORICAL ADJUSTMENTS COMBINED
----------- ------------- -----------
<S> <C> <C> <C>
NET SALES FROM CONTINUING OPERATIONS $ 339,646 $ (54,747)(1) $ 284,899
COST OF PRODUCTS SOLD 278,591 (46,769)(2) 231,822
----------- ---------- ----------
GROSS PROFIT $ 61,055 $ (7,978) $ 53,077
----------- ---------- ----------
OTHER COSTS AND EXPENSES-
SELLING AND ADMINSTRATIVE EXPENSES $ 58,011 $ (12,557)(3) $ 45,454
INTEREST EXPENSE 14,422 (5,850)(4) 8,572
OTHER (INCOME) EXPENSE,NET 4,862 (306)(5) 4,556
PROVISION FOR RESTRUCTURING COSTS 7,800 0 7,800
----------- ---------- -----------
$ 85,095 $ (18,713) $ 66,382
----------- ---------- -----------
INCOME (LOSS) FROM CONTINUING
OPERATIONS BEFORE TAXES AND
CHANGE IN ACCOUNTING PRINCIPLE $ (24,040) $ 10,735 $ (13,305)
PROVISION FOR INCOME TAXES 0 (108)(6) (108)
----------- ---------- -----------
INCOME (LOSS) FROM CONTINUING
OPERATIONS BEFORE CHANGE IN
ACCOUNTING PRINCIPLE $ (24,040) $ 10,843 $ (13,197)
----------- ---------- -----------
----------- ---------- -----------
INCOME (LOSS) FROM CONTINUING
OPERATIONS BEFORE CHANGE IN
ACCOUNTING PRINCIPLE APPLICABLE
TO COMMON STOCK $ (26,442) $ (15,599)
----------- -----------
----------- -----------
EARNINGS (LOSS) PER COMMON SHARE $ (3.21) $ (1.89)
----------- -----------
----------- -----------
AVERAGE NUMBER OF COMMON SHARES
OUTSTANDING 8,247 8,247
----------- -----------
----------- -----------
</TABLE>
<PAGE>
ALLIED PRODUCTS CORPORATION AND CONSOLIDATED SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME (LOSS)
FOR THE YEAR ENDED DECEMBER 31, 1992
(IN THOUSANDS OF DOLLARS)
- ------------------------------------------------------------------------------
Explanation of pro forma adjustments:
(1). To eliminate sales associated with the White-New Idea Farm
Equipment division disposed of as noted in the
introduction. This reduction was offset in part by increased
sales resulting from certain product sales which were historically
recorded as intercompany sales.
(2). To eliminate cost of sales related to the sales adjustment
above. In addition, the amortization of a deferred credit
associated with the acquisition of this business by the Company in
1984 was eliminated.
(3). To eliminate selling and administrative expenses associated with the
White-New Idea Farm Equipment division disposed of as noted in
the introduction.
(4). To record a reduction in interest expense associated with the
utilization of proceeds received from the disposition used to
reduce outstanding debt. Interest rates used in the computation
of the reduction in interest expense approximated the actual rates
in effect on the debt retired for the twelve months ended
December 31, 1992. A variance in interest rates used of 1/8 percent
would have the effect of increasing or decreasing the pro forma
combined loss by $72.
(5). To eliminate other (income) expense associated with the White-New
Idea Farm Equipment division disposed of as noted in the
introduction.
(6). To eliminate state income taxes associated with the White-New
Idea Farm Equipment division disposed of as noted in the
introduction.
<PAGE>
ALLIED PRODUCTS CORPORATION AND CONSOLIDATED SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME (LOSS)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1993
(IN THOUSANDS OF DOLLARS)
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
HISTORICAL ADJUSTMENTS COMBINED
----------- ------------- -----------
<S> <C> <C> <C>
NET SALES FROM CONTINUING OPERATIONS $ 302,157 $ (53,858)(1) $ 248,299
COST OF PRODUCTS SOLD 231,667 (39,812)(2) 191,855
----------- ----------- -----------
GROSS PROFIT $ 70,490 $ (14,046) $ 56,444
----------- ----------- -----------
OTHER COSTS AND EXPENSES-
SELLING AND ADMINSTRATIVE EXPENSES $ 42,605 $ (9,540)(3) $ 33,065
INTEREST EXPENSE 8,653 (3,557)(4) 5,096
OTHER (INCOME) EXPENSE,NET 3,321 (610)(5) 2,711
PROVISION FOR RESTRUCTURING COSTS 700 0 700
----------- ----------- -----------
$ 55,279 $ (13,707) $ 41,572
----------- ----------- -----------
INCOME (LOSS) FROM CONTINUING
OPERATIONS BEFORE TAXES AND
CHANGE IN ACCOUNTING PRINCIPLE $ 15,211 $ (339) $ 14,872
PROVISION FOR INCOME TAXES 519 (108)(6) 411
----------- ----------- -----------
INCOME (LOSS) FROM CONTINUING
OPERATIONS BEFORE CHANGE IN
ACCOUNTING PRINCIPLE $ 14,692 $ (231) $ 14,461
----------- ----------- -----------
----------- ----------- -----------
INCOME (LOSS) FROM CONTINUING
OPERATIONS BEFORE CHANGE IN
ACCOUNTING PRINCIPLE APPLICABLE
TO COMMON STOCK $ 13,113 $ 12,882
----------- -----------
----------- -----------
EARNINGS (LOSS) PER COMMON SHARE $ 1.46 $ 1.44
----------- -----------
----------- -----------
AVERAGE NUMBER OF COMMON SHARES
OUTSTANDING 8,972 8,972
----------- -----------
----------- -----------
</TABLE>
<PAGE>
ALLIED PRODUCTS CORPORATION AND CONSOLIDATED SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME (LOSS)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1993
(IN THOUSANDS OF DOLLARS)
- --------------------------------------------------------------------------------
Explanation of pro forma adjustments:
(1). To eliminate sales associated with the White-New Idea Farm Equipment
division disposed of as noted in the introduction. This reduction was
offset in part by increased sales resulting from certain product sales
which were historically recorded as intercompany sales.
(2). To eliminate cost of sales related to the sales adjustment above. In
addition, the amortization of a deferred credit associated with the
acquisition of this business by the Company in 1984 was eliminated.
(3). To eliminate selling and administrative expenses associated with the
White-New Idea Farm Equipment division disposed of as noted in the
introduction.
(4). To record a reduction in interest expense associated with the
utilization of proceeds received from the disposition used to reduce
outstanding debt. Interest rates used in the computation of the
reduction in interest expense approximated the actual rates in effect
on the debt retired for the nine months ended September 30, 1993. A
variance in interest rates used of 1/8 percent would have the effect
of increasing or decreasing the pro forma combined loss by $54.
(5). To eliminate other (income) expense associated with the White-New Idea
Farm Equipment division disposed of as noted in the introduction.
(6). To eliminate state income taxes associated with the White-New Idea
Farm Equipment division disposed of as noted in the introduction.
<PAGE>
ALLIED PRODUCTS CORPORATION AND CONSOLIDATED SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
SEPTEMBER 30, 1993
(IN THOUSANDS OF DOLLARS)
ASSETS
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
HISTORICAL ADJUSTMENTS(1) COMBINED
----------- -------------- -----------
<S> <C> <C> <C>
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS $ 40,625 $ 0 $ 40,625
NOTES AND ACCOUNTS RECEIVABLE,
NET OF ALLOWANCE FOR DOUBTFUL
ACCOUNTS 72,646 (26,446) 46,200
INVENTORIES 71,545 (26,164) 45,381
PREPAID EXPENSES 2,680 (72) 2,608
----------- ------------- -----------
TOTAL CURRENT ASSETS $ 187,496 $ (52,682) $ 134,814
----------- ------------- -----------
PLANT AND EQUIPMENT, AT COST:
LAND $ 2,627 $ (207) $ 2,420
BUILDINGS AND IMPROVEMENTS 35,025 (6,174) 28,851
MACHINERY AND EQUIPMENT 47,046 (8,871) 38,175
----------- ------------- -----------
$ 84,698 $ (15,252) $ 69,446
LESS-ACCUMULATED DEPRECIATION
AND AMORTIZATION 49,790 (8,407) 41,383
----------- ------------- -----------
$ 34,908 $ (6,845) $ 28,063
----------- ------------- -----------
OTHER ASSETS:
NOTES RECEIVABLE, DUE AFTER
ONE YEAR $ 8,917 $ 0 $ 8,917
DEFERRED CHARGES (GOODWILL),
NET OF AMORTIZATION 17,209 0 17,209
OTHER 1,684 (345) 1,339
----------- ------------- -----------
$ 27,810 $ (345) $ 27,465
----------- ------------- -----------
$ 250,214 $ (59,872) $ 190,342
----------- ------------- -----------
----------- ------------- -----------
</TABLE>
<PAGE>
ALLIED PRODUCTS CORPORATION AND CONSOLIDATED SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
SEPTEMBER 30, 1993
(IN THOUSANDS OF DOLLARS)
LIABILITIES AND SHAREHOLDERS' INVESTMENT
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
HISTORICAL ADJUSTMENTS(1) COMBINED
----------- -------------- -----------
<S> <C> <C> <C>
CURRENT LIABILITIES:
REVOLVING LOANS $ 4,924 $ 0 $ 4,924
CURRENT PORTION OF LONG-TERM
DEBT 15,015 (8,172) 6,843
ACCOUNTS PAYABLE 23,152 (6,117) 17,035
ACCRUED EXPENSES 48,515 (4,733) 43,782
----------- ----------- -----------
TOTAL CURRENT LIABILITIES $ 91,606 $ (19,022) $ 72,584
----------- ----------- -----------
LONG-TERM DEBT, LESS CURRENT
PORTION SHOWN ABOVE $ 77,141 $ (46,084) $ 31,057
----------- ----------- -----------
DEFERRED CREDITS AND OTHER
LONG-TERM LIABILITIES $ 5,092 $ (1,903) $ 3,189
----------- ----------- -----------
REDEEMABLE PREFERRED STOCK-
SERIES C $ 13,600 $ 0 $ 13,600
----------- ----------- -----------
REDEEMABLE PREFERRED STOCK-
SERIES B $ 2,550 $ 0 $ 2,550
----------- ----------- -----------
SHAREHOLDERS' INVESTMENT:
REDEEMABLE PREFERRED STOCK-
SERIES B $ 7,340 $ 0 $ 7,340
COMMON STOCK 91 0 91
ADDITIONAL PAID-IN CAPITAL 92,408 0 92,408
RETAINED EARNINGS (DEFICIT) (39,614) 7,137 (32,477)
----------- ----------- -----------
$ 60,225 $ 7,137 $ 67,362
----------- ----------- -----------
$ 250,214 $ (59,872) $ 190,342
----------- ----------- -----------
----------- ----------- -----------
</TABLE>
<PAGE>
ALLIED PRODUCTS CORPORATION AND CONSOLIDATED SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
SEPTEMBER 30, 1993
(IN THOUSANDS OF DOLLARS)
- --------------------------------------------------------------------------------
Explanation of pro forma adjustments:
(1). Pro forma adjustments reflect the effects of the disposition of the
assets of the White-New Idea Farm Equipment division as described in
the introduction. Elimination of the liabilities assumed by the
purchaser is also reflected in the accompanying pro forma
consolidated balance sheet. Also reflected is the consideration
received by the Company related to the described disposition (based
upon the balance sheet at September 30, 1993), the utilization of the
proceeds received toward the elimination\reduction of debt and the
gain on the disposition of these assets.
<PAGE>
EXHIBIT(c)(2)(a)(i)
AGREEMENT FOR THE SALE OF ASSETS
OF THE WHITE-NEW IDEA FARM EQUIPMENT
DIVISION OF ALLIED PRODUCTS CORPORATION
DATED AS OF NOVEMBER 8, 1993
BY AND BETWEEN
AGCO CORPORATION
AND
ALLIED PRODUCTS CORPORATION
<PAGE>
Page
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1. SALE AND PURCHASE OF ASSETS; DEFINITIONS OF ASSETS 2
1.1 Farm Equipment and Farm Equipment Parts 2
1.2 Purchased Assets 2
1.2.1 Inventory 3
1.2.2 Tooling 3
1.2.3 Machinery and Equipment 3
1.2.4 Real Property Leases 3
1.2.5 Certain Proprietary Rights 3
1.2.6 Receivables 4
1.2.7 Contract Rights 4
1.2.8 Other Assets 4
1.3 Real Property 5
1.4 Excluded Assets 5
1.5 Assumed Liabilities 6
1.6 Excluded Liabilities 6
2. PURCHASE PRICE 9
2.1 Purchase Price 9
2.2 Payment of Purchase Price 9
2.2.1 Closing Payment 9
2.2.2 Post-Closing Adjustment 10
2.2.2.1 Calculation 10
2.2.2.2 Payment of Adjustment 10
2.2.2.3 Refund of Adjustment 10
2.3 Base Balance Sheet; Closing Balance Sheet 11
2.3.1 Base Balance Sheet 11
2.3.2 Closing Balance Sheet 11
2.3.3 Buyer's Review of Closing Balance Sheet 11
2.4 Allocation of Purchase Price 12
<PAGE>
Page
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3. WHITE AND NEW IDEA DEALERS 12
3.1 Definitions 12
3.2 Objective 13
3.3 Assignment of Rights and Obligations Under Dealer Agreements
Regarding Farm Equipment and Farm Equipment Parts 13
3.4 Dealer Returns of Farm Equipment and Farm Equipment Parts 14
4. [Intentionally Omitted] 14
5. REPRESENTATIONS AND WARRANTIES OF SELLER 14
5.1 Organization 15
5.2 Qualification to Do Business 15
5.3 Authorization; No Breach; Consents 15
5.4 No Conflict or Violation 16
5.5 Title to Purchased Assets; Condition 17
5.6 Proprietary Information 17
5.7 Dealer List Prices and Standard Costs 18
5.8 Financial Statements 18
5.9 Inventory 19
5.10 Receivables 19
5.11 [Intentionally Omitted] 19
5.12 Customers, Distributors and Suppliers 19
5.13 Dealer Contracts 20
5.14 Contracts 20
<PAGE>
Page
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5.15 Severance Arrangements 23
5.16 Purchase Commitments and Outstanding Bids 23
5.17 Widespread Failure 24
5.18 Environmental Matters 24
5.19 Litigation 27
5.20 Taxes 28
5.21 Locations of Purchased Assets 28
5.22 Conduct of Business 28
5.23 Solvency 29
5.24 Brokers 29
5.25 Accuracy of Warranties 29
6. REPRESENTATIONS AND WARRANTIES OF BUYER 30
6.1 Organization 30
6.2 Qualification to do Business 30
6.3 Authorization 30
6.4 No Consent or Approval Required 31
6.5 Brokers 31
7. COVENANTS OF SELLER 31
7.1 Operation of Business 32
7.2 Preservation of Business 32
7.3 Access 32
7.4 No Solicitation 33
<PAGE>
Page
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7.5 Notice 33
8. ADDITIONAL AGREEMENTS OF THE PARTIES 33
8.1 Best Efforts; Further Assurances 33
8.2 Seller's Access to Records After Closing 34
8.3 Buyer's Access to Records After Closing 34
8.4 Disposition of Certain Information 35
8.5 Employees and Employee Benefits 36
8.5.1 Employment 36
8.5.2 Pension Plans and 401(k) Plans 36
8.5.3 Retiree Benefits 36
8.5.4 Workers' Compensation 37
8.5.5 Accrued Vacation 37
8.5.6 Severance 37
8.5.7 Communication with Employees and Dealers 37
8.6 Bulk Sales 37
9. CLOSING; DELIVERY 38
9.1 Closing 38
9.2 Deliveries and Payments at Closing 38
9.3 Possession 40
10. CONDITIONS TO CLOSING 40
10.1 Mutual Conditions 40
10.1.1 HSR Act 40
10.1.2 Bank Consents 40
10.1.3 No Suit 41
10.2 Buyer's Conditions 41
10.2.1 Representations and Warranties To Be Correct 41
10.2.2 No Material Change 41
<PAGE>
Page
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10.2.3 Certificates 41
10.2.4 Opinion of Counsel 43
10.2.5 Release of Liens 45
10.2.6 Base Balance Sheet 45
10.3 Seller's Conditions 45
10.3.1 Representations and Warranties To Be Correct 45
10.3.2 Certificates 45
10.3.3 Opinion of Counsel 46
10.3.4 Certificate of Assumption of Liabilities 47
11. TERMINATION 47
11.1 Termination of Agreement 47
11.1.1 Mutual Consent 47
11.1.2 Breach 48
11.1.3 Litigation 48
11.1.4 Cut-Off Date 48
11.2 Effect of Termination 48
12. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; INDEMNITY 48
12.1 Survival of Representations and Warranties 49
12.2 Indemnification by Seller 49
12.2.1 Inaccuracy of Representations, Etc. 49
12.2.2 Breach of Covenant 50
12.2.3 Product Liability 50
12.2.4 Certain Taxes 50
12.2.5 Bulk Sales 50
12.2.6 Environmental Liability 50
12.2.8 Liabilities Other than Assumed Liabilities 52
12.2.9 Seller Indemnification Threshold 52
12.3 Indemnification By Buyer 52
12.3.1 Inaccuracy of Representations, Etc. 53
12.3.2 Breach of Covenant 53
12.3.3 Product Liability 53
12.3.4 Certain Taxes 53
12.3.5 Environmental Liability 54
<PAGE>
Page
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12.3.6 Other Liabilities 54
12.3.7 Buyer Indemnification Threshold 54
12.4 Miscellaneous 55
12.5 Cooperation 55
13. NON-COMPETITION; NON-SOLICITATION OF EMPLOYEES 56
13.1 Scope of Non-Competition 56
13.2 Non-Solicitation of Employees 57
13.3 Injunctive Relief 57
14. MISCELLANEOUS 58
14.1 Notices 58
14.2 Expenses; Sales and Use Taxes 59
14.3 Governing Law 60
14.4 Successors and Assigns 60
14.5 No Third Party Beneficiaries 60
14.6 Execution in Counterparts 60
14.7 Titles and Headings 60
14.8 Entire Agreement 60
14.9 Amendment and Modification 61
14.10 Public Announcement 61
<PAGE>
AGREEMENT FOR THE
SALE OF ASSETS OF THE
WHITE-NEW IDEA FARM EQUIPMENT DIVISION OF
ALLIED PRODUCTS CORPORATION
AGREEMENT dated as of November 8, 1993, by and between ALLIED PRODUCTS
CORPORATION, a Delaware corporation ("Seller"), and AGCO CORPORATION, a Delaware
corporation ("Buyer").
W I T N E S S E T H:
WHEREAS, Seller, through its division commonly known as the White-New Idea
Farm Equipment Division of Allied Products Corporation, owns and operates facil-
ities engaged in the manufacture and sale of equipment and service parts for use
in agricultural and farming operations which are sold through dealers under the
"White," "White Farm," "White Farm Equipment," "WFE," "New Idea," "AG One" and
"Uni" names (the "Farm Equipment Business"); and
WHEREAS, Buyer is engaged in the sale of farm equipment and service parts
through dealers; and
WHEREAS, Seller desires to transfer, sell and assign to Buyer, and Buyer
desires to purchase and acquire from Seller, subject to the terms and conditions
set forth herein, the Farm
<PAGE>
Equipment Business and substantially all of the assets of and certain
liabilities relating to the Farm Equipment Business;
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants, warranties, representations and conditions contained in this
Agreement, the parties hereto hereby agree as follows:
1. SALE AND PURCHASE OF ASSETS; DEFINITIONS OF ASSETS
Upon the terms and subject to the conditions and exceptions contained
herein, Seller agrees to sell to Buyer, and Buyer agrees to purchase from
Seller, at the "Closing" (as hereinafter defined), or at such other times as are
herein provided, free and clear of all liens, claims and encumbrances, all of
Seller's right, title and interest in and to the "Purchased Assets" (as
hereinafter defined). For purposes of this Agreement, the date of the Closing
shall be referred to as the "Effective Date."
1.1 FARM EQUIPMENT AND FARM EQUIPMENT PARTS. For purposes of this
Agreement, "Farm Equipment" shall mean the products and accessories listed and
described on Schedule 1.1. "Farm Equipment Parts" shall mean service parts for
Farm Equipment, including, without limitation, the high volume, low margin,
after market replacement parts not included as original equipment parts in the
White service parts catalog.
1.2 PURCHASED ASSETS. For purposes of this Agreement, the term
"Purchased Assets" shall mean all assets, properties and rights, other than the
"Excluded Assets" (as defined in Section 1.4 hereof), held by Seller as of the
Effective Date which relate primarily to Seller's
-2-
<PAGE>
conduct of the Farm Equipment Business, including, without limitation, all
assets reflected on the "Closing Balance Sheet" (as defined in Section 2.3.2
hereof). Without limiting the generality of the foregoing, the Purchased Assets
shall include all of Seller's right, title and interest in and to, as of the
Effective Date, the following assets which are used primarily in, or which arise
from, the conduct of the Farm Equipment Business:
2.1 INVENTORY. All inventories of raw materials, purchased parts and
components, and all work-in-process, employed in the production of Farm
Equipment and Farm Equipment Parts (the "Production Inventories") wherever
located; all inventories of finished Farm Equipment Parts (the "Service Parts
Inventories") wherever located; and all inventories of finished Farm Equipment
and all "action" inventories of finished Farm Equipment used as demonstrators,
show units, engineering models and dealer returns (collectively, the "Whole
Goods Inventories") wherever located.
1.2.2 TOOLING. All tooling, dies, jigs, fixtures, patterns,
molds, tools and similar tangible personal property wherever located, including,
without limitation, those items listed and described on Schedule 1.2.2.
1.2.3 MACHINERY AND EQUIPMENT. All machinery, equipment,
supplies, office equipment, fixtures, furniture and other personal property
items wherever located, including, without limitation, those items listed and
described on Schedule 1.2.3.
1.2.4 REAL PROPERTY LEASES. To the extent assignable, all real
property leasehold interests listed on Schedule 1.2.4 (collectively, the "Real
Property Leases").
1.2.5 CERTAIN PROPRIETARY RIGHTS. All owned intellectual
property, including, without limitation, all copyrights, technology, trade
secrets, know-how, engineering
-3-
<PAGE>
drawings, inventions, patents and trademarks (and all applications therefor) and
the goodwill associated therewith, trade names, computer software developed by
Seller and other proprietary information and rights, specifically including,
without limiting the generality of the foregoing, the trade names and associated
trademarks and logos listed on Schedule 1.2.5, and to the extent assignable, all
licensed intellectual property (collectively, the "Proprietary Rights").
1.2.6 RECEIVABLES. All account receivables, trade acceptance
receivables and other receivables (collectively, the "Receivables").
1.2.7 CONTRACT RIGHTS. To the extent assignable, all "Dealer
Agreements" (as defined in Section 3.1 hereof) and all rights under the
executory contracts, personal property leases, purchase and sale orders and
other commitments of the Farm Equipment Business for the purchase of raw
materials, supplies and other goods and services (i) listed on Schedule 5.14
hereto and (ii) those which are not required to be listed on Schedule 5.14
hereto and were entered into by Seller in the ordinary course of the Farm
Equipment Business (collectively, the "Contract Rights"); provided that Seller
shall remain liable with respect to, and Buyer shall not indemnify Seller for,
any breach or alleged breach of performance by Seller prior to the Effective
Date with respect to all such contracts, orders and other commitments.
1.2.8 OTHER ASSETS. All catalogs, brochures, customer lists and
records, credit files, product slides, videotapes, photos, ad mats and other
marketing material; all books and records, including, without limitation, all
financial, operating, inventory and legal records; all of Seller's rights with
respect to the manufacture and sale of toys associated with the Farm Equipment
Business; and all other assets reflected on the Closing Balance Sheet (other
than the Real Property).
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1.3 REAL PROPERTY. At the Closing Buyer and Seller shall enter into:
(a) a Lease Agreement (the "Coldwater Lease") substantially in the form of
EXHIBIT A attached hereto, pursuant to which Buyer shall lease from Seller all
real property, fixtures and improvements comprising Seller's plant in Coldwater,
Ohio (the "Coldwater Plant"); and (b) a Lease Agreement (the "Kewanee Lease")
substantially in the form of EXHIBIT B attached hereto, pursuant to which Buyer
shall lease from Seller all real property, fixtures and improvements comprising
Seller's plant in Kewanee, Illinois (the "Kewanee Plant" and together with the
Coldwater Plant, the "Real Property"). Notwithstanding the foregoing, it is the
mutual intention of the parties hereto that Buyer shall purchase from Seller,
subsequent to the Closing hereunder, the Real Property pursuant to that certain
Contract for the Purchase and Sale of Real Property of even date herewith by and
between Buyer and Seller with respect to the Coldwater Plant (the "Coldwater
Contract") and that certain Contract for the Purchase and Sale of Real Property
of even date herewith by and between Buyer and Seller, with respect to the
Kewanee Plant (the "Kewanee Contract" and together with the Coldwater Contract
the "Real Property Contract"), upon the terms and subject to the conditions and
exceptions contained therein and herein.
1.4 EXCLUDED ASSETS. For purposes of this Agreement, the term
"Excluded Assets" shall mean the following assets, properties and rights held by
Seller as of the Effective Date: (a) all assets, properties and rights primarily
used by Seller other than in connection with the operation of the Farm Equipment
Business; (b) all cash, cash equivalents and notes; (c) all real estate; (d) all
leasehold interests other than those listed on Schedule 1.2.4 and those arising
under the personal property leases which are assigned to and assumed by Buyer
pursuant to Section 1.5 hereof; and (e) all contracts or agreements to which
Seller is a party or by which Seller is bound other than those which are
assigned to and assumed by Buyer pursuant to Section 1.5 hereof.
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1.5 ASSUMED LIABILITIES. Buyer shall assume and agree to pay,
perform and discharge only those liabilities and obligations of Seller
(collectively, the "Assumed Liabilities") related to the Business (a) arising or
accruing under any contract, agreement or commitment transferred and assigned to
Buyer at the Closing pursuant to Section 1.2.7 hereof or (b) reflected on the
Closing Balance Sheet, including, without limitation, reserves for dealer
performance bonuses and warranty liabilities. Any and all other liabilities and
obligations of Seller, known or unknown, liquidated or unliquidated, contingent
or fixed, which are not among the Assumed Liabilities (collectively, the
"Excluded Liabilities"), whether or not disclosed in this Agreement or any
Schedule or exhibit hereto, shall not be assumed by Buyer and shall remain the
liabilities and obligations of Seller. Seller shall pay, perform and discharge
all of the Excluded Liabilities consistent with present practice. The Assumed
Liabilities shall include all liabilities and obligations arising out of,
resulting from or relating to the discharge and satisfaction of all warranty
services, repairs and replacements with respect to Farm Equipment and Farm
Equipment Parts sold prior to (and after) the Effective Date, in accordance with
Seller's standard warranty given in connection with sales of Farm Equipment and
Farm Equipment Parts. A description of Seller's standard warranty given in
connection with the sale of Farm Equipment and Farm Equipment Parts is set forth
on Schedule 1.5.1. The Assumed Liabilities shall also include all of Seller's
liabilities and obligations to pay dealer performance bonuses to "Dealers" (as
defined in Section 3.1 hereof) applicable to Farm Equipment collections in
accordance with the terms of Seller's dealer performance bonus program. A
description of Seller's dealer performance bonus program is set forth on
Schedule 1.5.2.
1.6 EXCLUDED LIABILITIES. Without limiting the generality of
Section 1.5 hereof, the term "Excluded Liabilities" shall include the following
liabilities and obligations as the same shall exist as of the Effective Date:
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(a) All liabilities and obligations incurred by Seller in
connection with the conduct of any business other than the Farm Equipment
Business;
(b) All liabilities and obligations arising out of, resulting
from, or relating to any violation of any current or past statute, ordinance, or
governmental regulation, including, without limitation, all liabilities or
obligations incurred in connection with or arising out of or resulting from the
presence, release or disposal of "Hazardous Substances" (as defined in Section
5.18 hereof) at any time on or prior to the date of the Closing (or in the case
of any presence, release or disposal by Seller or any predecessor of Seller or
any representative or independent contractor thereof, at any time prior to or
after the date of the Closing), whether or not such claims or actions with
respect thereto are described, listed or referred to on any Schedule hereto, and
all "Environmental Claims" (as defined in Section 5.18 hereof) relating to
actions, inactions, occurrences or conditions happening or existing on or prior
to the Closing, whether or not such Environmental Claims, actions, inactions,
occurrences or conditions are described, listed or referred to on any Schedule
hereto;
(c) Except as specifically provided in Section 8.5 hereof, any
liabilities to or in respect of any employees or former employees of Seller for
any period prior to the Effective Date (collectively, "Employee Liabilities"),
including, without limitation: (a) any liability under or with respect to any
employee benefit plan, program or arrangement, whether or not written, at any
time maintained, contributed to by Seller or under which Seller may incur
liability, or any liability with respect to Seller's withdrawal or partial
withdrawal by Seller from or termination of any such plan, program or
arrangement; and (b) any claim of an unfair labor practice, or any claim under
any state unemployment compensation law or regulation or under any federal or
state employment discrimination law or regulation, that shall have been asserted
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on or prior to the Effective Date, or to the extent the basis for any claim,
liability, damages or penalty shall have arisen on or prior to the Effective
Date, whether or not such liabilities are described, listed or referred to on
any Schedule hereto;
(d) All liabilities and obligations for all litigation and
claims under the Occupational Safety and Health Act of 1970, as amended, to the
extent they relate to the conduct of the Farm Equipment Business prior to the
Effective Date;
(e) Any liabilities in respect of injury to or death of any
person or damage to or destruction of any property, whether based on negligence,
breach of warranty, strict liability, enterprise liability or any other legal or
equitable theory, arising in respect of any Farm Equipment or Farm Equipment
Parts manufactured or sold by Seller or any of Seller's predecessors on or prior
to the Effective Date, whether or not such liabilities are described, listed or
referred to on any Schedule hereto;
(f) All liabilities and obligations for taxes relating to the
conduct of the Farm Equipment Business prior to the Effective Date;
(g) All liabilities and obligations relating to the Excluded
Assets;
(h) All liabilities and obligations relating to any recourse
obligations or arrangements under or pursuant to any retail finance programs;
(i) All liabilities and obligations arising or accruing under
any contract, agreement or commitment not assumed by Buyer pursuant to Section
1.5(a) hereof; and
(j) All other liabilities and obligations upon which Buyer and
Seller mutually agree.
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2. PURCHASE PRICE.
2.1 PURCHASE PRICE. Subject to the terms and conditions contained
herein, Buyer agrees to pay to Seller, and Seller agrees to accept from Buyer,
an aggregate purchase price (the "Purchase Price") for the Purchased Assets
(other than the Real Property, the purchase price of which is set forth in the
Real Property Contract) equal to one hundred ten percent (110%) of the "Net Book
Value" (as hereinafter defined) of the Purchased Assets as of the Effective
Date. For purposes of this Agreement, the "Net Book Value" of the Purchased
Assets as of the Effective Date shall mean the book value (net of accumulated
depreciation and other valuation reserves) of the Purchased Assets less the
Assumed Liabilities, all as reflected on the Closing Balance Sheet.
2.2 PAYMENT OF PURCHASE PRICE. Subject to the terms and conditions
contained herein, Buyer shall pay the Purchase Price to Seller as follows:
2.2.1 CLOSING PAYMENT. Subject to the terms and conditions
contained herein, Buyer shall pay to Seller at the Closing, by means of wire
transfer of immediately available funds, an amount (the "Closing Payment") equal
to one hundred ten percent (110%) of the Net Book Value of the Purchased Assets
as of November 30, 1993, as reflected on the interim balance sheet (the "Base
Balance Sheet") of the Farm Equipment Business as of such date, determined in
accordance with generally accepted accounting principles consistently applied
with those used in the preparation of Seller's certified financial statements as
of December 31, 1992, subject to Section 5.8 hereof. The Closing Payment shall
not include any portion of the "Real Property Purchase Price" (as defined in the
Real Property Contract).
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2.2.2 POST-CLOSING ADJUSTMENT. After the Closing Balance Sheet is
finalized pursuant to Section 2.3 hereof, the Closing Payment shall be adjusted
as follows (the "Adjustment") to reflect the Purchase Price:
2.2.2.1 CALCULATION. The Adjustment shall be calculated and finally
determined on the date that the Purchase Price is finally determined after the
Closing Balance Sheet is finalized pursuant to Section 2.3 hereof. If the
Purchase Price is equal to the Closing Payment, then the Adjustment will equal
zero. If the Purchase Price exceeds the Closing Payment, then the Adjustment
will be a positive amount equal to the amount by which the Purchase Price
exceeds the Closing Payment. If the Purchase Price is less than the Closing
Payment, then the Adjustment will be a negative amount equal to the amount by
which the Purchase Price is less than the Closing Payment.
2.2.2.2 PAYMENT OF ADJUSTMENT. If the Adjustment is a positive
amount, Buyer shall pay to Seller, within ten (10) days after the final
determination of the Adjustment pursuant hereto, by means of wire transfer of
immediately available funds, the amount of the Adjustment, together with
interest thereon at a rate of six percent (6%) per annum (compounded annually)
for the period from the Closing Date through and including the date on which the
Adjustment is paid.
2.2.2.3 REFUND OF ADJUSTMENT. If the Adjustment is a negative
amount, Seller shall refund to Buyer, within ten (10) days after the final
determination of the Adjustment pursuant hereto, by means of wire transfer of
immediately available funds, the amount of the Adjustment, together with
interest thereon at a rate of six percent (6%) per annum (compounded annually)
for the period from the Closing Date through and including the date on which the
Adjustment is refunded.
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2.3 BASE BALANCE SHEET; CLOSING BALANCE SHEET.
2.3.1 BASE BALANCE SHEET. Seller shall deliver the Base
Balance Sheet to Buyer on or before December 10, 1993. Following its receipt of
the Base Balance Sheet, Buyer shall have five (5) days to review the Base
Balance Sheet. In the event Buyer disputes any items set forth on the Base
Balance Sheet, Buyer and Seller will attempt to resolve in good faith any such
disputed items in a timely manner.
2.3.2 CLOSING BALANCE SHEET. Promptly after the Effective
Date, Seller shall cause the accounting firm of Coopers & Lybrand (the
"Accountants") to conduct an audit of the Farm Equipment Business. Within
forty-five (45) days after the Effective Date, the Accountants shall deliver to
Buyer and Seller a balance sheet (the "Closing Balance Sheet") of the Farm
Equipment Business as of the Effective Date. The Closing Balance Sheet shall be
prepared by applying the same accounting practices used in creating the Base
Balance Sheet (provided that the Real Property, together with accumulated
depreciation thereon, shall be included on the Closing Balance Sheet as
contemplated by the Real Property Contract) and shall be presented in accordance
with generally accepted accounting principles consistently applied with those
used in the preparation of Seller's certified financial statements as of
December 31, 1992, but shall exclude any reserves or other liabilities which
Buyer and Seller agree shall not be assumed by Buyer pursuant to this Agreement.
2.3.3 BUYER'S REVIEW OF CLOSING BALANCE SHEET. Following its
receipt of the Closing Balance Sheet, Buyer shall have thirty (30) days to
review the Closing Balance Sheet. At or before the end of such thirty (30)-day
period, Buyer shall either: (a) accept the Closing Balance Sheet in its
entirety, in which case the Purchase Price will be determined based on the
Closing Balance Sheet as delivered; or (b) deliver to Seller and the Accountants
written
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notice and a detailed written explanation of those items in the Closing Balance
Sheet which Buyer disputes, in which case all other items not affected by the
disputed items will be deemed to be as set forth on the Closing Balance Sheet as
delivered. Within a further period of thirty (30) days after the end of the
aforementioned review period, the parties will attempt to resolve in good faith
any such disputed items. Failing such resolution, at the end of said thirty
(30) days the unresolved disputed items will be referred to the Atlanta, Georgia
office of Price Waterhouse, by either Buyer or Seller, for final binding
resolution. Such firm shall establish procedures for such resolution if the
parties are unable to agree on those procedures and shall attempt to determine
the unresolved disputed items within thirty (30) days after such reference. The
Purchase Price shall then be determined based on the items previously accepted
by Buyer pursuant to subsection (b) above and the disputed items as resolved
pursuant to this Section 2.3.3.
2.4 ALLOCATION OF PURCHASE PRICE. The Purchase Price shall be
allocated among the Purchased Assets (other than the Real Property) as set forth
on an Allocation Schedule to be prepared by Buyer at or prior to Closing,
subject to Seller's consent thereto which shall not be unreasonably withheld.
3. WHITE AND NEW IDEA DEALERS.
3.1 DEFINITIONS. For purposes of this Agreement, the term "Dealer"
shall mean any person, partnership, corporation or other organization which is
engaged in the business of selling Farm Equipment or Farm Equipment Parts at
retail and is a party to: (a) the White or the New Idea standard form of sales
and service dealer agreement or parts dealer agreement, as
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amended from time to time (a "Dealer Agreement"); or (b) a non-standard written
version of a Dealer Agreement (also referred to herein as a "Dealer Agreement");
or (c) an oral version of a Dealer Agreement (also referred to herein as a
"Dealer Agreement"). A copy of the standard form of each of the White Dealer
Agreement and the New Idea Dealer Agreement in effect as of the date hereof is
attached as Schedule 3.1.1. A schedule listing each non-standard written Dealer
Agreement and each oral Dealer Agreement in effect as of the date hereof,
together with a brief description of each such Dealer Agreement and the name and
location of the corresponding Dealer, is attached as Schedule 3.1.2. A schedule
listing the name, location and 1991, 1992 and 1993 (through September 30, 1993)
purchases and settlements for each Dealer pursuant to its Dealer Agreement is
attached as Schedule 3.1.3.
3.2 OBJECTIVE. The joint objective of the parties hereto is to enter
into arrangements with Dealers following the Closing, but effective from and
after the Effective Date, whereby each Dealer from and after the Effective Date
will be a dealer of the Buyer for Farm Equipment and Farm Equipment Parts, and
Buyer will assume and discharge Seller's contractual obligations under the
Dealer Agreements with respect to Farm Equipment and Farm Equipment Parts. Each
party will cooperate with and assist the other party in all reasonable respects
to achieve their joint objective.
3.3 ASSIGNMENT OF RIGHTS AND OBLIGATIONS UNDER DEALER AGREEMENTS
REGARDING FARM EQUIPMENT AND FARM EQUIPMENT PARTS. At Closing, but effective
from and after the Effective Date, Seller shall assign to Buyer all of its
rights in, to and under all of the Dealer Agreements with respect to Farm
Equipment and Farm Equipment Parts, and Buyer shall agree to assume and
discharge all of Seller's contractual duties and obligations which accrue
following the Effective Date under such Dealer Agreements, provided that all
such Dealer Agreements
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conform in all material respects to Schedule 3.1.1 or are listed on Schedule
3.1.2. Seller and Buyer shall cooperate in such arrangements as may be
reasonably required to assure that Buyer has valid and perfected, first-priority
security interests in such Farm Equipment, Farm Equipment Parts and other farm
implements as have been sold as of, or may be sold after, the Effective Date to
such Dealers under their respective Dealer Agreements, and in the proceeds
thereof, including, without limitation, any used equipment which security
interests shall be preserved and maintained in favor of Buyer thereafter. All
filing costs incurred pursuant to this Section 3.3 shall be the responsibility
of Buyer.
3.4 DEALER RETURNS OF FARM EQUIPMENT AND FARM EQUIPMENT PARTS. Buyer
shall indemnify, defend and hold Seller harmless from, and shall pay and
discharge, pursuant to the terms of the Dealer Agreements, or applicable
federal, state or provincial statutes, all obligations to Dealers for returns of
Farm Equipment and Farm Equipment Parts received by Buyer on or after the
Effective Date as a result of the termination of any such Dealers or for any
other reason.
4. [INTENTIONALLY OMITTED]
5. REPRESENTATIONS AND WARRANTIES OF SELLER.
Seller hereby represents and warrants, except as modified and supplemented
on the various schedules attached hereto which contain exceptions to the
representations and warranties, to Buyer as follows:
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5.1 ORGANIZATION. Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware with all
requisite corporate power and authority to carry on its business as presently
conducted and to own (or lease) and operate its business and assets.
5.2 QUALIFICATION TO DO BUSINESS. Seller is qualified to do business
and is in good standing in every jurisdiction wherein the nature of Seller's
activities or properties owned or leased in connection with the Farm Equipment
Business makes qualification as a foreign corporation necessary and where a
failure to be so qualified might have a material adverse effect upon Seller's
assets, business or properties. Each such jurisdiction where Seller is so
qualified has been disclosed to Buyer on Schedule 5.2.
5.3 AUTHORIZATION; NO BREACH; CONSENTS. Seller has the corporate
power and authority to sell, transfer and assign the Purchased Assets and the
Real Property to Buyer pursuant to this Agreement and the Real Property
Contract, respectively. The execution, delivery and performance of this
Agreement and the Real Property Contract, and all of the transactions
contemplated herein and therein, have been duly authorized by all necessary
corporate action of Seller. This Agreement and the Real Property Contracts
constitute, and the other documents and instruments to be executed and delivered
by Seller pursuant hereto or thereto will, when executed and delivered,
constitute the valid and binding obligations of Seller, enforceable against
Seller in accordance with their respective terms, subject as to enforcement to
usual equitable principles and except as limited by bankruptcy, moratorium,
insolvency or similar laws of general application affecting the enforcement of
creditors' rights generally. Except as set forth on Schedule 5.3.1 hereto,
Seller is not subject to any restriction or other provision contained in its
Restated Certificate of Incorporation or Bylaws or any agreement, contract,
instrument, order,
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judgment, decree or other restriction that would prevent or adversely affect the
consummation of the transactions contemplated by this Agreement or the Real
Property Contract or that would, upon the consummation of the transactions
contemplated by this Agreement or the Real Property Contract, result in the
creation of any lien, mortgage, security interest, charge or other encumbrance
upon the Purchased Assets or the Real Property, or the acceleration of any
obligation affecting the Purchased Assets or the Real Property. Other than as
required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended (the "HSR Act"), except as described in Schedule 5.3.2, no notice to,
filing with, or authorization, consent or approval of any public body or
authority or any private person or entity, is required in connection with the
execution, delivery and performance by Seller of this Agreement, the Real
Property Contract or the other documents and instruments to be delivered by
Seller pursuant hereto or thereto or the consummation by Seller of the
transactions contemplated hereby or thereby.
5.4 NO CONFLICT OR VIOLATION. Except as set forth on Schedule 5.4.1,
neither the execution, delivery and performance of this Agreement or the Real
Property Contract nor the consummation of the transactions contemplated hereby
or thereby will result in: (a) a violation of or a conflict with any provision
of Seller's Restated Certificate of Incorporation or Bylaws; (b) a breach of, or
a default under, or the creation of any right of any party to accelerate,
terminate or cancel, any contract, permit, authorization or concession to which
Seller is a party or by which any of the Purchased Assets or the Real Property
are bound; (c) a violation by Seller of any law; or (d) an imposition of any
material encumbrance, restriction or charge on the business of Seller or on any
of the Purchased Assets or the Real Property. Except as set forth on
Schedule 5.4.2, no consent, approval or authorization of, or declaration, filing
or registration with, any authority, or any other person or entity, is required
to be made or obtained by Seller in connection with the
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execution, delivery and performance of this Agreement or the Real Property
Contract and the consummation of the transactions contemplated hereby or
thereby.
5.5 TITLE TO PURCHASED ASSETS; CONDITION. Seller has good and
marketable title to all of the Purchased Assets, free and clear of all liens,
claims, charges, set-offs, encumbrances or restrictions of every kind except as
disclosed and described in Schedule 5.5. The documents of transfer to be
executed by Seller and delivered at the Closing will be sufficient to convey
good and marketable title to the same, free and clear of all liens, claims,
charges, set-offs, encumbrances, or restrictions of every kind, other than as
may be imposed by Buyer. The Purchased Assets and the Real Property constitute
and include all of the property, assets and rights related to, used, or useful
in the conduct of the Farm Equipment Business, other than the Excluded Assets.
The Purchased Assets and the Real Property (exclusive of the Purchased Assets
not currently used in the operation of the Farm Equipment Business) have been
maintained in accordance with normal industry practice, are in reasonable
operating condition and repair (except for ordinary wear and tear) and are
sufficient for the operation of the Farm Equipment Business as currently
conducted.
5.6 PROPRIETARY INFORMATION. Seller uses the trade names listed on
Schedule 5.6.1 in the conduct of the Farm Equipment Business as presently
conducted and owns or possesses the right to use the trade names, trademarks,
trademark applications, copyrights, copyright applications, patents, patent
applications, inventions, trade secrets, proprietary processes and formulae, and
all other proprietary technical information, whether patentable or unpatentable,
necessary to conduct the Farm Equipment Business as presently conducted. The
trademarks, trade names, patents and applications therefor listed on Schedule
5.6.2 constitute all of the same necessary for the conduct of the Farm Equipment
Business as heretofore conducted
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by Seller. Schedule 5.6.3 identifies any intellectual property rights that any
third party owns and that Seller uses or proposes to use in the Farm Equipment
Business and specifies whether such use is or will be pursuant to license,
sublicense, agreement or permission. Except as set forth on Schedule 5.6.4, no
person has a right to receive a royalty or similar payment in respect of any of
the intellectual property rights now used or proposed to be used in the Farm
Equipment Business pursuant to any contractual arrangements entered into by
Seller or otherwise. Seller has no licenses granted by or to it and no other
agreements to which it is a party, relating in whole or in part to any of the
aforesaid intellectual property rights, except as set forth on Schedule 5.6.5.
5.7 DEALER LIST PRICES AND STANDARD COSTS. Schedule 5.7 contains a
list of Seller's dealer list prices for Farm Equipment and Farm Equipment Parts
as of the date of this Agreement and will be updated, in form and substance
reasonably acceptable to Buyer, as soon as practicable hereafter to include
Seller's standard costs therefor.
5.8 FINANCIAL STATEMENTS. Seller has heretofore delivered to Buyer a
true and complete copy of the financial statements of the Farm Equipment
Business as of December 31, 1992, December 31, 1991, and December 31, 1990, and
interim financial statements of the Farm Equipment Business as of March 31, June
30 and September 30, 1993. Except as set forth on Schedule 5.8, such financial
statements: (a) were prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods indicated; (b) are in
accordance with the books and records of the Farm Equipment Business; and (c)
present fairly, as of their respective dates or the periods covered thereby, the
financial position, stockholder's equity, cash flow and results of operations of
the Farm Equipment Business. Except as noted therein, when delivered to Buyer
hereunder, all subsequent financial statements for the Farm Equipment Business,
including, without limitation, the Base Balance Sheet and the Closing Balance
Sheet,
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will: (d) have been prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods indicated; (e) have been
prepared in accordance with the books and records of the Farm Equipment
Business; and (f) present fairly, as of their respective dates or the periods
covered thereby, as applicable, the financial position, stockholders' equity,
cash flow and results of operations of the Farm Equipment Business.
5.9 INVENTORY. A listing of Seller's Whole Goods Inventories as of
September 30, 1993, is set forth on Schedule 5.9.1. The Production Inventories
and Service Parts Inventories are located only at the Coldwater Plant and the
locations listed on Schedule 5.9.2.
5.10 RECEIVABLES. The Receivables reflected on the Base Balance Sheet
and the Receivables reflected on the Closing Balance Sheet will represent, bona
fide claims against debtors for sales made, services performed and other charges
arising on or before the date thereof, as the case may be, and all of the goods
delivered and services performed that will give rise to said Receivables will
have been delivered or performed in accordance with the applicable orders,
contracts or customer or distributor requirements. Except for Receivables which
arose from Dealers who terminate their respective Dealer Agreements after the
Closing, all Receivables reflected on the Closing Balance Sheet shall be subject
to no defenses, counterclaims or rights of set-off, except to the extent of any
of Seller's reserves for returns of Farm Equipment or Farm Equipment Parts set
forth on the Closing Balance Sheet.
5.11 [INTENTIONALLY OMITTED]
5.12 CUSTOMERS, DISTRIBUTORS AND SUPPLIERS. Schedule 5.12 contains a
complete and accurate list of: (a) all customers and distributors of the Farm
Equipment Business during Seller's last fiscal year, other than the Dealers
listed on Schedule 3.1.3, showing the approximate
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total sales by Seller to each such customer and distributor during such fiscal
year; and (b) all suppliers of the Farm Equipment Business from whom Seller has
made aggregate purchases in excess of $100,000.00 during Seller's last fiscal
year, showing the approximate total purchases by Seller from each supplier
during such fiscal year. Since December 31, 1992, there have been no changes in
the business relationships with any Dealers or with any customers, distributors
or suppliers named on Schedule 5.12 which, in the aggregate, would have a
material adverse effect on the Farm Equipment Business.
5.13 DEALER CONTRACTS. Schedule 5.13.1 sets forth a listing as of the
date hereof of all contracts, agreements and commitments with Dealers relating
to the conduct of the Farm Equipment Business, including, without limitation,
all Dealer Agreements. Except as may be set forth on Schedule 3.1.2, all such
Dealer Agreements conform in all material respects to the respective forms of
Dealer Agreements attached as Schedule 3.1.1. Except as set forth on Schedule
5.13.2 and subject to Section 5.16 hereof, there are no liquidated or contingent
liabilities owed, or potentially owing, by Seller to any Dealer other than as
will be set forth on the Base Balance Sheet and the Closing Balance Sheet.
5.14 CONTRACTS. Except for contracts listed on Schedule 5.14 and
subject to Section 5.16 hereof, Seller is not a party to, or bound by, any
contract of any kind to be performed after the date of the Closing with respect
to the Farm Equipment Business: (a) pursuant to which it is obligated to expend
more than $5,000 in any twelve (12)-month period and that is not subject to
cancellation on not more than thirty (30) days' notice by Seller without penalty
or increased cost; or (b) with any employees or other personnel or other
affiliates of Seller. To the best of Seller's knowledge, there is no default by
any party to any such contract, which default could have a material adverse
effect on the business, operations or prospects of the
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Farm Equipment Business. Without limiting the generality of the foregoing and
subject to Sections 5.14(a) and 5.14(b), Schedule 5.14 lists the following
contracts, agreements and other arrangements with respect to the Farm Equipment
Business to which Seller is a party:
(i) any written arrangements (or group of related written
arrangements) for the lease of personal property;
(ii) any written arrangement (or group of related written
arrangements) for the purchase or sale of raw materials, commodities,
supplies, products or other property or for the furnishing or receipt of
services, including, without limitation, any customer or vendor contracts;
(iii) any written arrangement (or group of related written
arrangements) concerning a partnership or joint venture with any other
person;
(iv) any written arrangement (or group of related written
arrangements) under which it has created, incurred, assumed or guaranteed
(or may create, incur, assume or guarantee) indebtedness (including
capitalized lease obligations) or under which it has imposed (or may
impose) a security interest or lien on any of its assets, tangible or
intangible;
(v) any written arrangement (or group of related written
arrangements) concerning confidentiality or non-competition arrangements;
(vi) any employee benefit plan of Seller and any written
arrangement with any of its directors, officers, stockholders or employees
in the nature of a collective bargaining agreement, employment agreement or
severance agreement;
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(vii) any written arrangement with any of its directors,
officers, shareholders or employees or any member of any such person's
immediate family (A) providing for the furnishing of material services by,
(B) providing for the rental of material real or personal property from, or
(C) otherwise requiring material payments to (other than for services as
officers, directors or employees of Seller), any such person or any
corporation, partnership, trust or other entity in which any such person
has a substantial interest as a shareholder, officer, director, trustee or
partner;
(viii) any other written arrangement (or group of related
written arrangements) under which the consequences of a default or
termination could have a material adverse effect;
(ix) any other written arrangement (or group of related written
arrangements) not entered into in the ordinary course of business
consistent with past practice; or
(x) any oral contract, agreement or other arrangement with
respect to any of the matters referred to in the foregoing clauses (i)
through (ix) and any proposal (oral or written) to enter into any contract,
agreement or other arrangement with respect to any of the matters referred
to in the foregoing clauses (i) through (ix).
Seller has delivered to Buyer a correct and complete copy of each written
arrangement listed under the name of Seller in Schedule 5.14 and has included as
part of Schedule 5.14 a brief summary of any such oral contracts, agreements or
other arrangements and any proposals (oral or written) to enter into any such
contracts, agreements or other arrangements. Except as set forth on
Schedule 5.14, with respect to each written arrangement listed: (A) the written
arrangement is legal, valid, binding, enforceable (except as such enforceability
may be limited by (i) bankruptcy,
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insolvency, moratorium, reorganization and other similar laws affecting
creditors' rights generally and (ii) the general principles of equity,
regardless of whether asserted in a proceeding in equity or at law) and in full
force and effect; (B) the written arrangement will continue to be legal, valid,
binding, enforceable (except as such enforceability may be limited by
(i) bankruptcy, insolvency, moratorium, reorganization and other similar laws
affecting creditors' rights generally and (ii) the general principles of equity,
regardless of whether asserted in a proceeding in equity or at law) and in full
force and effect on identical terms following the Closing; (C) no party is in
material breach or default, and no event has occurred which with notice or lapse
of time could constitute a material breach or default or permit termination,
modification or acceleration, under the written arrangement; and (D) no party
has repudiated any term of the written arrangement.
5.15 SEVERANCE ARRANGEMENTS. Neither Seller nor any affiliate of
Seller has entered into any severance or similar arrangement in respect of any
personnel that will result in any obligation (absolute or contingent) of Buyer
to make any payment to any such personnel following the transfer to Buyer of the
Purchased Assets or the Real Property.
5.16 PURCHASE COMMITMENTS AND OUTSTANDING BIDS. Except as set forth
on Schedule 5.16, as of the date of this Agreement there are no accepted and
unfilled orders for the sale of goods, products and services entered into by
Seller and relating to the Farm Equipment Business which exceed $100,000.00
individually or $10,000,000.00 in the aggregate or which were not entered into
in the ordinary course of the Farm Equipment Business. As of the date of this
Agreement, there are no claims against Seller to return in excess of an
aggregate of $50,000.00 of goods or products related to the Farm Equipment
Business by reason of alleged overshipments, defective products or otherwise.
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5.17 WIDESPREAD FAILURE. Seller is not aware of any widespread
failure or potential widespread failure with respect to any Farm Equipment or
Farm Equipment Parts, or any components thereof, manufactured or sold as a part
of the Farm Equipment Business.
5.18 ENVIRONMENTAL MATTERS. (a) Except as set forth on Schedule 5.18,
to the best of Seller's knowledge, Seller is, and at all times has been, in
compliance with all "Environmental Laws" (as hereinafter defined), except where
the failure to comply would not have a material adverse effect on the Farm
Equipment Business.
(b) Except as set forth on Schedule 5.18, there is no existing or, to
Seller's knowledge, threatened Environmental Claim, nor has Seller received any
notification or knowledge of alleged, actual or potential responsibility for, or
any inquiry or investigation regarding, any disposal, release, or threatened
release at any location of any Hazardous Substance generated or transported by
Seller in connection with the Farm Equipment Business.
(c) Except as set forth on Schedule 5.18, to the best of Seller's
knowledge: (i) no underground tank or other underground storage receptacle for
Hazardous Substances is currently located on any of Seller's properties used in
connection with the Farm Equipment Business and there have been no releases of
any Hazardous Substances from any underground tank or related piping at any
time; and (ii) there have been no releases (i.e., any past or present releasing,
spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, disposing, or dumping) of Hazardous Substances by Seller on,
upon, or into the properties of Seller used in connection with the Farm
Equipment Business, except where such circumstance or event would not have a
material adverse effect on the Farm Equipment Business. In addition, to the
best of Seller's knowledge, there have been no such releases by Seller's
corporate predecessors and no such releases on, upon, or into any real property
in the
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vicinity of any of the properties of Seller used in connection with the Farm
Equipment Business that, through soil or ground water contamination, may have
come to be located on the property of Seller.
(d) No environmental lien has attached to the Real Property or to any
other property to be transferred to Buyer under this Agreement or the Real
Property Contract.
(e) DEFINITIONS.
(i) For purposes of this Agreement, "Environmental Laws" shall
mean all applicable federal, state, district, local, and foreign laws, all
rules or regulations promulgated thereunder, and all orders, consent
orders, judgments, notices, permits, or demand letters issued, promulgated,
or entered pursuant thereto, relating to pollution or protection of the
environment (including without limitation ambient air, surface water,
ground water, land surface, or subsurface strata), including, without
limitation: (i) laws relating to emissions, discharges, releases or
threatened releases of pollutants, contaminants, chemicals, industrial
materials, wastes, or other substances into the environment; and (ii) laws
relating to the identification, generation, manufacture, processing,
distribution, use, treatment, storage, disposal, recovery, transport, or
other handling of pollutants, contaminants, chemicals, industrial
materials, wastes or other substances. Environmental Laws shall include,
without limitation, the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended, the Toxic Substances Control Act, as
amended, the Hazardous Materials Transportation Act, as amended, the
Resource Conservation and Recovery Act, as amended, the Clean Water Act, as
amended, the Safe Drinking Water Act, as amended, the Clean Air Act, as
amended, the Atomic Energy Act of 1954, as amended, the Occupational Safety
and
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Health Act, as amended, and all analogous laws promulgated or issued by
any state or other authority.
(ii) For purposes of this Agreement, "Environmental Claims" shall
mean all accusations, allegations, notice of violations, liens, claims,
demands, suits, or causes of action for any damage, including without
limitation, personal injury, property damage (including any depreciation of
property values), lost use of property or consequential damages, arising
directly or indirectly out of "Environmental Conditions" (as hereinafter
defined) or Environmental Laws. By way of example only, Environmental
Claims include: (i) violations of or obligations under any contract between
Seller and any other person; (ii) actual or threatened damages to natural
resources; (iii) claims for nuisance or its statutory equivalent;
(iv) claims for the recovery of response costs, or administrative or
judicial orders directing the performance of investigations, response or
remedial actions under any Environmental Laws; (v) a requirement to
implement "corrective action" pursuant to any order or permit issued
pursuant to the Resource Conservation and Recovery Act, as amended or
similar provisions of applicable state law; (vi) claims for restitution,
contribution or indemnity; (vii) fines, penalties or liens of any kind
against property; (viii) claims for injunctive relief or other orders or
notices of violation from federal, state or local agencies or courts; and
(ix) with regard to any present or former employees, claims relating to
exposure to or injury from Environmental Conditions.
(iii) For purposes of this Agreement, "Environmental
Conditions" shall mean the state of the environment, including natural
resources (e.g., flora and fauna), soil, surface water, ground water, any
present or potential drinking water supply, subsurface strata, or ambient
air, relating to or arising out of the use, handling, storage, treatment,
recycling,
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generation, transportation, release, spilling, leaking, pumping, pouring,
emptying, discharging, injecting, escaping, leaching, disposal, dumping, or
threatened release of Hazardous Substances by Seller or its predecessors or
successors in interest, agents, representatives, employees, or independent
contractors. With respect to Environmental Claims by third parties,
Environmental Conditions also include the exposure of persons to Hazardous
Substances at the work place or the exposure of persons or property to
Hazardous Substances migrating from or otherwise emanating from or located
on property owned or occupied by Seller.
(iv) For purposes of this Agreement, "Hazardous Substances" shall
mean all pollutants, contaminants, chemicals, wastes, and any other
carcinogenic, ignitable, corrosive, reactive, toxic, or otherwise hazardous
substances or materials (whether solids, liquids or gases), including but
not limited to any substances, materials, or wastes subject to regulation,
control, or remediation under Environmental Laws. By way of example only,
the term Hazardous Substances includes petroleum, urea formaldehyde,
flammable, explosive, and radioactive materials, PCBS, pesticides,
herbicides, asbestos, sludge, slag, acids, metals, solvents, or waste
waters.
5.19 LITIGATION. Except as set forth on Schedule 5.19, there is no
charge, complaint, action, order, writ, injunction, judgment or decree
outstanding or claim, suit, litigation, proceeding, labor dispute, or, to the
knowledge of Seller, investigation (collectively, "Actions") pending or, to the
knowledge of Seller, threatened or anticipated against, relating to or affecting
the Purchased Assets or the Real Property or the operation of the Farm Equipment
Business as currently operated and as proposed to be operated, any of which
would reasonably be expected to have a material adverse effect on the Farm
Equipment Business. Seller is not in
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default with respect to any judgment, order, writ, injunction or decree of any
kind or nature, and there are no unsatisfied judgments against Seller or the
Farm Equipment Business. There is not a reasonable likelihood of an adverse
determination of any pending Actions that would, individually or in the
aggregate, have a material adverse effect on Seller or the Farm Equipment
Business.
5.20 TAXES. All federal, state, local and foreign tax returns and
reports of the Seller required by law to be filed have been filed, and all
federal, state, local, foreign and any other taxes, assessments, fees and other
governmental charges with respect to the employees, properties, assets, income
or franchises of the Seller shown on such returns and reports to be due and
payable, or which are otherwise due and payable, have been paid by Seller or
accrued or reserved against on Seller's financial statements or will be properly
accrued or reserved against on the books and records of Seller as of the date of
the Closing.
5.21 LOCATIONS OF PURCHASED ASSETS. Seller's chief executive office
from which the Farm Equipment Business is conducted is located in Chicago,
Illinois; the additional offices from which such business is conducted are
located at the Coldwater Plant, the Kewanee Plant and the locations listed on
Schedule 5.21, and no Purchased Assets are located anywhere other than the
Coldwater Plant, the Kewanee Plant or the locations listed on Schedule 5.21.
5.22 CONDUCT OF BUSINESS. To the best of Seller's knowledge, Seller
has not participated, directly or indirectly, in any boycotts or other similar
practices affecting any of its actual or potential customers, dealers or
distributors.
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5.23 SOLVENCY. Both immediately prior to and after the Closing (after
giving effect to each of the transactions contemplated by this Agreement), the
following statements are and will be true and correct as to Seller:
(a) The present fair saleable value of the Purchased Assets exceeds
the amount that will be required to be paid on or in respect of the existing
debts and other liabilities (including contingent liabilities) relating to the
Purchased Assets as they mature.
(b) Seller acknowledges that it has received reasonably equivalent
value and fair consideration for the Purchased Assets and for its execution,
delivery and performance of this Agreement and the transactions contemplated
hereby.
5.24 BROKERS. Seller has not retained any broker, finder, investment
banker or financial advisor in connection with this Agreement or the Real
Property Contract or any transaction contemplated herewith to which Buyer may be
held liable for any fees or other compensation.
5.25 ACCURACY OF WARRANTIES. No representation or warranty by Seller
in this Agreement or the Real Property Contract, and no exhibit, certificate,
schedule, or instrument prepared or delivered, or to be delivered, by Seller
pursuant hereto or thereto or in connection with the transactions contemplated
hereby or thereby, contains or will contain any untrue statement by Seller of a
material fact or omits or will omit to state a material fact by Seller necessary
to make the statements contained herein and therein not misleading.
5.26 DISCLOSURE. Seller has disclosed all events, conditions and
facts materially affecting: (a) the Purchased Assets, the Real Property and the
business or the condition (financial or otherwise), properties, liabilities,
reserves, working capital, earnings, technology, prospects or
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relations with customers, suppliers, distributors or employees of the Farm
Equipment Business; and (b) the right or ability of Seller to consummate the
transactions contemplated hereby and thereby; provided, however, notwithstanding
Section 12.1 hereof, Buyer shall have no recourse against Seller pursuant to
this Section 5.2.6 after the date which is ten (10) days after the date on which
the Adjustment is finally determined.
6. REPRESENTATIONS AND WARRANTIES OF BUYER.
Buyer represents and warrants to Seller as follows:
6.1 ORGANIZATION. Buyer is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware with all
requisite corporate power and authority to carry on its respective business as
presently conducted and to own (or lease) and operate its business and assets.
6.2 QUALIFICATION TO DO BUSINESS. Buyer is qualified to do business
and is in good standing in every jurisdiction wherein the nature of its
activities or properties owned or leased makes qualification as a foreign
corporation necessary and where a failure to be so qualified might have a
material adverse effect upon Buyer's assets, business or properties.
6.3 AUTHORIZATION. The execution, delivery and performance of this
Agreement and the Real Property Contract and all of the transactions
contemplated hereby or thereby have been duly authorized by all necessary
corporate action of Buyer. This Agreement and the Real Property Contract
constitute, and the other documents and instruments to be executed and delivered
by Buyer pursuant hereto and thereto will, when executed and delivered,
constitute the
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valid and binding obligations of Buyer, enforceable against Buyer in accordance
with their respective terms, subject as to enforcement to general equitable
principles and except as limited by bankruptcy, moratorium, insolvency or
similar laws of general application affecting the enforcement of creditors'
rights generally. The execution, delivery and performance by Buyer of this
Agreement and the Real Property Contract, and the other documents and
instruments to be delivered by Buyer pursuant hereto and thereto, will not
result in any violation of or be in conflict with or constitute a default under
the Buyer's Certificate of Incorporation or Bylaws or any agreement or law,
regulation, rule or ordinance by which Buyer is bound or to which any of its
assets are subject.
6.4 NO CONSENT OR APPROVAL REQUIRED. Other than as required under
the HSR Act, no permit, consent, approval or authorization of, or declaration to
or filing with, any governmental or regulatory authority or other person or
entity is required of Buyer in connection with the execution, delivery and
performance by Buyer of this Agreement or the Real Property Contract or the
other documents and instruments to be delivered by Buyer pursuant hereto or
thereto or the consummation by Buyer of any other transaction contemplated
hereby or thereby.
6.5 BROKERS. Buyer has not retained any broker, finder, investment
banker or financial advisor in connection with this Agreement or the Real
Property Contract or any transaction contemplated hereby or thereby to which
Seller may be held liable for any fees or other compensation.
7. COVENANTS OF SELLER.
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Seller covenants and agrees that, from and after the date of this Agreement
and until the Closing, Seller will conduct the Farm Equipment Business subject
to the following provisions and limitations:
7.1 OPERATION OF BUSINESS. Prior to the Closing, Seller shall
continue to carry on the Farm Equipment Business in the ordinary course and
consistent with past practice and will not take any action inconsistent
therewith or with the consummation of the transactions contemplated hereby.
Except with the written consent of Buyer, Seller shall not take any action or
omit to take any action which would result in a breach, violation or inaccuracy
in any material respect of any representation, warranty or covenant of Seller
made in this Agreement or the Real Property Contract.
7.2 PRESERVATION OF BUSINESS. Seller shall use its best efforts to
carry on the Farm Equipment Business substantially in the same manner as
heretofore conducted and shall keep the business organization of the Farm
Equipment Business substantially intact, including its present business
operations, physical facilities, working conditions and employees and its
present relationships with suppliers and customers and others having business
relations with it, except as otherwise consented to in advance by Buyer.
7.3 ACCESS. Seller shall grant Buyer and representatives of Buyer
reasonable access during normal business hours, to all management employees,
premises, properties, books, records, contracts, accounting records and other
documents of the Farm Equipment Business, and Seller will furnish to Buyer any
information in respect of the business and affairs of the Farm Equipment
Business as Buyer may from time to time reasonably request; provided, however,
that Buyer shall hold all such information strictly confidential and not use
such information for any
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purpose whatsoever other than in connection with evaluating the acquisition of
the Purchased Assets, the Real Property and the Farm Equipment Business.
7.4 NO SOLICITATION. Seller and its directors, officers, employees,
agents, representatives and affiliates will not solicit or request from third
parties any offers to purchase all or substantially all of the assets or
business of the Farm Equipment Business nor participate in any negotiations
related to such offers.
7.5 NOTICE. Seller shall promptly give Buyer written notice of
Seller's becoming aware of the existence or occurrence of any event or condition
which would make any representation or warranty of Seller contained herein or in
the Real Property Contract untrue in any material respect or which might prevent
the consummation of the transactions contemplated hereby or by the Real Property
Contract.
8. ADDITIONAL AGREEMENTS OF THE PARTIES.
8.1 BEST EFFORTS; FURTHER ASSURANCES. Subject to the terms and
conditions contained herein, each of the parties hereto agrees to use its best
efforts to take, or cause to be taken, all actions, and to do, or cause to be
done, all things reasonably necessary, proper or advisable under applicable laws
and regulations to consummate and make effective the transactions contemplated
by this Agreement and by the Real Property Contract. Seller and Buyer will each
use their respective best efforts to obtain consents of all third parties and
governmental bodies necessary to the consummation of the transactions
contemplated by this Agreement and by the Real Property Contract. In the event
that at any time after the Closing, or the "Real Property Closing" (as defined
in the Real Property Contract), any further action is
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necessary to carry out the purposes of this Agreement or the Real Property
Contract, the proper officers and/or directors of the Seller or Buyer, as the
case may be, shall take all such actions without any further consideration
therefor.
8.2 SELLER'S ACCESS TO RECORDS AFTER CLOSING. After the Closing,
Buyer agrees that it will give, or cause to be given, to Seller, its successors
and their representatives, during normal business hours and, at Seller's or its
successors' expense, such reasonable access to the properties, titles,
contracts, books, records, files, documents and affairs of Buyer as is
reasonably necessary to allow Seller or Seller's successors to obtain
information in Buyer's possession with respect to the Farm Equipment Business
and to allow Seller to obtain information with respect to any claims, demands,
audits, suits or matters of a similar nature made by or against Seller as the
previous owner and operator of the Farm Equipment Business, and (at Seller's or
its successors' expense) to make copies of such information to the extent
reasonably necessary. Buyer agrees to cooperate (including reasonable access
and availability of its employees) at Seller's expense with Seller with respect
to any claims, demands, audits, suits or matters of a similar nature made by or
against Seller as the previous owner and operator of the Farm Equipment Business
to the extent such matters relate to the operation of the Farm Equipment
Business. Prior to the Closing, Seller may make copies and take extracts from
such records, at its expense, but the originals thereof, to the extent in
Seller's possession, shall be delivered or otherwise made available to Buyer.
8.3 BUYER'S ACCESS TO RECORDS AFTER CLOSING. After the Closing,
Seller agrees that it will give, or cause to be given, to Buyer, its successors
and its representatives, during normal business hours and at Buyer's or its
successors' expense, such reasonable access to the properties, titles,
contracts, books, records, files, documents and affairs of Seller associated
with the Farm Equipment Business as is reasonably necessary to allow Buyer or
Buyer's successors to
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obtain information with respect to any claims, demands, audits, suits or matters
of a similar nature made by or against Buyer as the new owner and operator of
the Farm Equipment Business to the extent such matters relate to operation of
the Farm Equipment Business prior to the Closing, and (at Buyer's or its
successors' expense) to make copies of such information to the extent reasonably
necessary. Seller agrees to fully cooperate (including reasonable access and
availability of its employees) at Buyer's expense with Buyer with respect to any
claims, demands, audits, suits or matters of a similar nature made by or against
Buyer as the new owner and operator of the Farm Equipment Business to the extent
such matters relate to the operation of the Farm Equipment Business.
8.4 DISPOSITION OF CERTAIN INFORMATION. If Buyer or Seller desires
to dispose of any of the contracts, books, records or files referred to in
Sections 8.2 or 8.3 of this Agreement, such party (the "Disposing Party") shall
notify the other party hereto (the "Nondisposing Party") in writing (with
reasonable specification of the documents to be disposed of) of its intentions
with respect thereto. The Nondisposing Party shall, if it wishes to obtain
possession of any of the contracts, books, records or files to which said notice
applies, notify the Disposing Party in writing within fifteen (15) days after
the date of the Disposing Party's notice to the Nondisposing Party, to ship said
contracts, books, records or files (at the Nondisposing Party's expense and
pursuant to such party's reasonable instructions) to the Nondisposing Party; or
to a location designated in the Nondisposing Party's notice to the Disposing
Party. If the Nondisposing Party fails to so notify the Disposing Party, the
Disposing Party shall be free to dispose of the contracts, books, records and
files referred to in the Disposing Party's notice in any manner, including
destruction thereof, not otherwise inconsistent with the terms of this
Agreement.
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8.5 EMPLOYEES AND EMPLOYEE BENEFITS.
8.5.1 EMPLOYMENT. Effective as of the Effective Date, each
employee of the Farm Equipment Business, other than those listed on Schedule
8.5.1, shall cease to be an employee of the Farm Equipment Business and will be
offered employment by Buyer at their existing salary and wage rates. All such
employees shall be at-will employees of Buyer, and Buyer shall not assume any
obligations under any employment or other agreements of such employees with
Seller. Except as may be specifically provided in this Section 8.5, Buyer shall
not assume or be liable for any Employee Liabilities. Buyer will grant all
employees of the Farm Equipment Business it hires credit for their respective
years of service with Seller for purposes of vacation and severance under
Buyer's policies.
8.5.2 PENSION PLANS AND 401(K) PLANS. Buyer will not become
a sponsor of any existing pension plan covering the Farm Equipment Business'
current or past employees or of any 401(k) plan of Seller, and no assets or
liabilities of any such pension or 401(k) plans will be transferred to or
assumed by Buyer or any plan or trust maintained by Buyer. Buyer will allow
employees of the Farm Equipment Business who become employees of Buyer hereunder
to immediately participate in Buyer's 401(k) plan.
8.5.3 RETIREE BENEFITS. Seller shall be responsible for any
retiree benefits which it chooses to provide to employees of the Farm Equipment
Business who retire prior to or at the Closing. Buyer shall be responsible for
any retiree benefits which it chooses to provide to employees of the Farm
Equipment Business who retire after the Closing. Each party reserves the right
to not offer or to change retiree benefits in the future when and as it deems
appropriate.
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8.5.4 WORKERS' COMPENSATION. Seller will bear the entire
cost and expense of all workers' compensation claims arising out of injuries
sustained by employees of the Farm Equipment Business on or before the Effective
Date. Buyer will bear the entire cost and expense of all workers' compensation
claims arising out of injuries sustained by employees of the Farm Equipment
Business after the date of the Effective Date.
8.5.5 ACCRUED VACATION. As of the Closing, Buyer shall
assume all of Seller's obligations for vacation accrued as of the Closing by the
Farm Equipment Business' employees who become Buyer's employees hereunder.
8.5.6 SEVERANCE. Buyer shall pay any employee of the Farm
Equipment Business who becomes Buyer's employee severance under Buyer's then
existing policies. Buyer shall be solely responsible for the cost and adequacy
of any such employee severance payment incurred in Buyer's termination of any of
said employees.
8.5.7 COMMUNICATION WITH EMPLOYEES AND DEALERS. Neither
Buyer nor Seller will make any announcement to employees of the Farm Equipment
Business or to any Dealers prior to the date of the Closing concerning the
effects of this transaction without the prior consent of the other, which
consent shall not be unreasonably withheld.
8.6 BULK SALES. It may not be practicable to comply or attempt to
comply with the procedures of the "Bulk Sales Act" or similar law of any or all
of the states in which the Purchased Assets are situated or of any other state
which may be asserted to be applicable to the transactions contemplated hereby.
Accordingly, to induce Buyer to waive any requirements for compliance with any
or all of such laws, Seller hereby agrees that, except for any liabilities
expressly assumed by Buyer pursuant to Section 4.1 hereof, Seller shall
indemnify, defend and
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hold Buyer harmless from any loss or liability incurred by Buyer arising out of
or resulting from the failure of Buyer or Seller to comply with any such laws or
any similar law.
9. CLOSING; DELIVERY.
9.1 CLOSING. The consummation of the purchase and sale of the
Purchased Assets and the Farm Equipment Business, other than the Real Property,
and the other transactions contemplated hereby (the "Closing") shall take place
at the offices of Buyer located at 5295 Triangle Parkway, Norcross, Georgia
30092, at 9:00 a.m. (local time) on December 31, 1993, or if the waiting periods
under the HSR Act, or any other applicable law, have not then expired or been
terminated or the other conditions to Closing set forth in Section 10 hereof
have not then been satisfied or waived, then such Closing shall take place as
soon as possible following the expiration or termination of such waiting periods
and the satisfaction or waiver of the other conditions to Closing, but in no
event later than February 28, 1994.
9.2 DELIVERIES AND PAYMENTS AT CLOSING.
(a) PAYMENT OF CLOSING PAYMENT. At the Closing, Buyer shall pay
the Closing Payment to Seller pursuant to Section 2.3.1 hereof.
(b) INSTRUMENTS. To effect the transfers of all of the
Purchased Assets other than the Real Property in accordance with this Agreement,
Seller shall, at the Closing, execute and deliver to Buyer:
(i) a bill of sale, in form and substance acceptable to
Buyer, pursuant to which Seller conveys the personal property Purchased Assets
to Buyer;
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(ii) the Coldwater Lease;
(iii) the Kewanee Lease;
(iv) assignments, in form and substance acceptable to Buyer,
of all Contract Rights to Buyer;
(v) assignments, in form and substance acceptable to Buyer,
of all Real Property Leases to Buyer;
(vi) assignments, in form and substance acceptable to Buyer,
of all Proprietary Rights, in recordable form to the extent necessary;
(vii) all books and records of the Farm Equipment
Business; and
(viii) such other instruments as shall be reasonably
requested by Buyer to vest in Buyer good and valid title in and to the Purchased
Assets (other than the Real Property) in accordance with the provisions hereof.
(c) FORM OF INSTRUMENTS. All of the foregoing instruments shall
be in form and substance, and shall be executed and delivered in a manner,
satisfactory to Buyer in its sole discretion.
(d) CERTIFICATES; OPINIONS. At the Closing, Buyer and Seller
shall each deliver to the other the certificates, opinions of counsel and other
items described in Section 10 hereof.
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(d) OTHER CLOSING TRANSACTIONS. At the Closing, each of the
parties hereto shall take such other actions required hereby to be performed by
it prior to or at the Closing, including, without limitation, satisfying the
conditions set forth in Section 10 hereof.
9.3 POSSESSION. Seller shall make available all of the Purchased
Assets for delivery to Buyer "where is" at the time of the Closing, and title to
and risk of loss of the Purchased Assets (but not the Real Property) shall pass
to Buyer concurrently with the Closing. Shipment of such Purchased Assets to
locations other than where they may be located at the Closing shall be at the
expense of Buyer.
10. CONDITIONS TO CLOSING.
10.1 MUTUAL CONDITIONS. The respective obligations of each party to
consummate the transactions contemplated by this Agreement shall be subject to
the fulfillment at or prior to the Closing of the following conditions:
10.1.1 HSR ACT. The waiting periods required for consummation
of the transactions contemplated hereby under the HSR Act, and any other
applicable laws, including, without limitation, the Canadian Competition Act, as
amended, if applicable, and the Investment Canada Act, as amended, if
applicable, shall have expired or been terminated.
10.1.2 BANK CONSENTS. The consents of Seller's lenders under
its secured credit agreements to the sale of the Purchased Assets, including,
without limitation, the lenders listed on Schedule 10.1.2, and such lenders'
release of any liens thereon, shall have been obtained to the reasonable
satisfaction of both Buyer and Seller.
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10.1.3 NO SUIT. No suit, action or other proceeding shall, to
the knowledge of either party, be pending before or by any governmental agency
or by any third party questioning the legality of this Agreement or the
consummation of the transactions contemplated hereby.
10.2 BUYER'S CONDITIONS. The obligations of Buyer to consummate the
transactions contemplated by this Agreement shall be subject to the fulfillment
at or prior to Closing of each of the following conditions:
10.2.1 REPRESENTATIONS AND WARRANTIES TO BE CORRECT. The
representations and warranties of Seller contained in this Agreement and the
Real Property Contract shall be true and correct in all material respects on the
date hereof and as of the Closing as though such representations and warranties
were made as of the Closing, and Seller shall have duly performed or complied
with all of the obligations to be performed or complied with by it under the
terms of this Agreement and the Real Property Contract on or prior to the date
of the Closing.
10.2.2 NO MATERIAL CHANGE. There shall have been no material
damage, destruction or loss (whether or not insured against), or any other
material and adverse change in the Purchased Assets or the Real Property or the
business or prospects of the Farm Equipment Business since the date of this
Agreement.
10.2.3 CERTIFICATES. Buyer shall have received such
certificates of Seller's officers and others to evidence compliance with the
conditions set forth in Section 10.1 hereof and in this Section 10.2 as may be
reasonably requested by Buyer, including, without limitation:
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(a) A certificate executed by the Secretary or an Assistant
Secretary of Seller certifying as of the date of the Closing: (a) a true and
complete copy of the Restated Certificate of Incorporation of Seller; (b) a true
and complete copy of the Bylaws of Seller; (c) a true and correct copy of the
resolutions of the board of directors of Seller authorizing the execution,
delivery and performance of this Agreement by Seller and the consummation of the
transactions contemplated hereby; and (d) incumbency matters;
(b) A certificate executed by the President and the Chief
Financial Officer of Seller certifying that, as of the date of the Closing, the
conditions set forth in Section 10.1 hereof and this Section 10.2 have been
satisfied;
(c) A copy of the certificate to do business of Seller,
certified by the appropriate Secretary of State or corresponding provincial
official, in Illinois, Ohio, Pennsylvania, Saskatchewan and Ontario;
(d) A certificate of the Secretary of State of each of
Delaware, Illinois, Ohio, and Pennsylvania, and a certificate of the
corresponding provincial official from Saskatchewan and Ontario, certifying the
good standing of Seller;
(e) Any and all forms, certificates and/or other
instruments required to pay the transfer and recording taxes and charges arising
from the transactions contemplated by this Agreement, together with evidence
reasonably satisfactory to Buyer that such transfer taxes and charges have been
paid; and
(f) Such other separate instruments of sale, assignment or
transfer and such other documents executed by Seller and/or any third party, if
necessary, that Buyer may reasonably deem necessary or appropriate in order to
perfect, confirm or evidence
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title to all or any part of the Purchased Assets as required by this Agreement
or to otherwise consummate the transactions contemplated hereby.
10.2.4 OPINION OF COUNSEL. Buyer shall have received an
opinion of Gardner, Carter & Douglas, the general counsel to Seller, or other or
additional counsel to Seller, dated as of the date of the Closing, in form and
substance satisfactory to Buyer, to the effect that:
(a) Seller is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware and that
Seller is duly qualified to do business as a foreign corporation and is in good
standing in each jurisdiction where the ownership of property or nature of its
business requires such qualification and where the failure to be so qualified
would have a material adverse affect on Seller;
(b) Seller has the necessary corporate power and authority
to own, lease and/or operate the Purchased Assets and to enter into this
Agreement, the Real Property Contract and all Closing documents (collectively,
the "Transaction Documents") and consummate the transactions contemplated hereby
and thereby;
(c) All corporate action by Seller required in order to
authorize the execution and delivery of the Transaction Documents and the
consummation of the transactions contemplated hereby has been duly and validly
taken;
(d) The Transaction Documents have been duly executed and
delivered by Seller and constitute the valid and binding obligation of Seller,
enforceable against Seller in accordance with their respective terms, except as
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to creditors' rights generally or by
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equitable principles (whether considered in an action at law or in equity) or
other customary limitations reasonably satisfactory to Buyer's counsel;
(e) Neither the execution and delivery of any of the
Transaction Documents by Seller nor the consummation of the transactions
contemplated hereby or thereby will (i) violate the Restated Certificate of
Incorporation or Bylaws of Seller, (ii) breach, or cause a default under, any
term or provision of any contract or agreement to which Seller is a party or
(iii) violate any judgment, decree, injunction, writ or order applicable to
Seller;
(f) No authorization, consent, order, permit or approval
of, or filing with, any Authority, or, any other person, is required for the
execution and delivery of any of the Transaction Documents by Seller or the
consummation by Seller of the transactions contemplated hereby or thereby except
as set forth in this Agreement or the Schedules hereto;
(g) No Action is pending or, to the best knowledge of such
counsel, threatened against Seller, its property or business or the transactions
contemplated by this Agreement which could be reasonably anticipated to have a
material adverse affect on the Farm Equipment Business;
(h) The execution and performance of any of the Transaction
Documents by Seller will not violate or result in a failure to comply with any
statute, law, ordinance, regulation, rule or order of any Authority, applicable
to the business or operations of Seller, and Seller has all material permits,
franchises and other authority required to conduct its business as presently
conducted; and
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(i) The documents to be delivered by Seller at the Closing
to effect the transfer and assignment to Buyer of all right, title and interest
to the Purchased Assets other than the Real Property are effective to do so.
10.2.5 RELEASE OF LIENS. Buyer shall have completed a UCC
lien search and Seller shall have delivered evidence of the release of all
encumbrances on any of the Purchased Assets or Real Property, whether or not
indicated on such lien search.
10.2.6 BASE BALANCE SHEET. Seller shall have delivered to
Buyer the Base Balance Sheet.
10.3 SELLER'S CONDITIONS. The obligations of Seller to
consummate the transactions contemplated by this Agreement shall be subject to
the fulfillment at or prior to the Closing of each of the following conditions:
10.3.1 REPRESENTATIONS AND WARRANTIES TO BE CORRECT. The
representations and warranties of Buyer contained in this Agreement shall be
true and correct in all material respects on the date hereof and as of the
Closing as though such representations and warranties were made as of Closing,
and Buyer shall have duly performed or complied with all of the obligations to
be performed or complied with by it under the terms of this Agreement on or
prior to Closing.
10.3.2 CERTIFICATES. Seller shall have received such
certificates of Buyer's officers and others to evidence compliance with the
conditions set forth in this Section 11.2.3 as may be reasonably requested by
Seller, including, without limitation:
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(a) A certificate executed by the Secretary or an Assistant
Secretary of Buyer certifying as of the date of Closing: (i) a true and complete
copy of the Certificate of Incorporation of Buyer; (ii) a true and complete copy
of the Bylaws of Buyer, (iii) a true and complete copy of the resolutions of the
board of directors of Buyer authorizing the execution, delivery and performance
of this Agreement by Buyer and the consummation of the transactions contemplated
hereby; and (iv) incumbency matters; and
(b) A certificate executed by the President or any Vice
President of Buyer certifying that, as of the date of Closing, the conditions
set forth in Section 11.1 hereof and this Section 11.3 have been satisfied.
10.3.3 OPINION OF COUNSEL. Seller shall have received an
opinion of Troutman Sanders, the general counsel to Buyer, or other or
additional counsel to Buyer, dated as of the date of the Closing, in form and
substance satisfactory to Seller, to the effect that:
(a) Buyer is duly incorporated, validly existing and in
good standing under the laws of the State of Delaware;
(b) Buyer has all necessary corporate power and authority
and has taken all corporate action necessary to enter into the Transaction
Documents, to consummate the transactions contemplated hereby and thereby and to
perform its obligations hereunder or thereunder;
(c) The Transaction Documents have been duly executed and
delivered by Buyer and constitute the legal, valid and binding obligations of
Buyer, enforceable against it in accordance with their respective terms, except
as such enforceability may be limited by (i) bankruptcy, insolvency, moratorium,
reorganization and other similar laws affecting
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creditors' rights generally and (ii) the general principles of equity,
regardless of whether asserted in a proceeding in equity or at law; and
(d) Neither the execution and delivery of any of the
Transaction Documents nor the consummation of the transactions contemplated
hereby or thereby will result in (a) a violation of or a conflict with any
provision of the Certificate of Incorporation or Bylaws of Buyer, (b) a breach
of, or a default under, any term or provision of any contract, agreement,
indebtedness, lease, commitment, license, franchise, permit, authorization or
concession to which Buyer is a party, which breach or default would have a
material adverse effect on the business or financial condition of Buyer or its
ability to consummate the transactions contemplated hereby or (c) a violation by
Buyer of any statute, rule, regulation, ordinance, code, order, judgment, writ,
injunction, decree or award, which violation would have a material adverse
effect on the business or financial condition of Buyer or its ability to
consummate the transactions contemplated hereby.
10.3.4 CERTIFICATE OF ASSUMPTION OF LIABILITIES. Buyer shall
have delivered to Seller a duly executed certificate of assumption of the
liabilities of Seller to be assumed by Buyer pursuant to Section 1.5 hereof.
11. TERMINATION
11.1 TERMINATION OF AGREEMENT. This Agreement and the transactions
contemplated hereby may be terminated at any time prior to the Closing, as
follows:
11.1.1 MUTUAL CONSENT. By mutual consent of Seller and Buyer.
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11.1.2 BREACH. By either Buyer or Seller by reason of the
breach prior to Closing by the other in any material respect of any of their
covenants or agreements contained in this Agreement, or if any of the
representations or warranties made by the other party hereunder are untrue,
inaccurate or misleading in any material respect.
11.1.3 LITIGATION. By either Buyer or Seller if any
litigation or proceeding instituted by any person has resulted, prior to
Closing, in an order, stay, judgment or decree restraining or prohibiting the
consummation of the transactions contemplated by this Agreement or the ownership
and operation by Buyer after Closing of all the Purchased Assets and the Farm
Equipment Business and such order or stay has not been vacated or such judgment
or decree has not been vacated or reversed, within ten (10) days after the entry
hereof.
11.1.4 CUT-OFF DATE. If the Closing shall not have occurred
on or before February 28, 1994, this Agreement shall automatically terminate
without further action.
11.2 EFFECT OF TERMINATION. If this Agreement is terminated pursuant
to Section 11.1 hereof (except by reason of subsection 11.1.2 hereof) all rights
and obligations of Seller and Buyer hereunder shall terminate, and if this
Agreement is terminated pursuant to Section 11.1.2 hereof, the non-breaching
party shall be entitled to exercise and pursue all rights and remedies available
to it hereunder, at law, in equity or otherwise.
12. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; INDEMNITY.
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12.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Except as the
relevant time periods are extended pursuant to Sections 12.2 or 12.3 hereof, or
as otherwise specifically provided in this Agreement, the representations and
warranties of the parties contained in this Agreement shall survive the Closing
for a period of twelve (12) months following the date of the Closing, and no
claim, action or proceeding may be brought by either party on account of any
breach, violation or inaccuracy in any representation or warranty after the
expiration of such twelve (12) month period unless, prior to the expiration of
such time period, a written claim shall have been submitted by the claiming
party to the other specifying in reasonable detail the nature and amount
thereof, to the extent determinable.
12.2 INDEMNIFICATION BY SELLER. Seller agrees that, notwithstanding
the Closing and regardless of any investigation made at any time by or on behalf
of Buyer or of any information Buyer may have in respect thereof (and in
addition to the other specific indemnities of Buyer by Seller hereunder), Seller
will indemnify, defend and save and hold Buyer harmless from and against any
claim, cost, expense, damage, liability, loss or deficiency suffered or incurred
by Buyer (including, without limitation, reasonable attorneys' fees and other
reasonable costs and expenses incident to any suit, action, claim or proceeding)
arising out of or resulting from the following:
12.2.1 INACCURACY OF REPRESENTATIONS, ETC. Subject to the
time limitation for survival of representations and warranties set forth in
Section 12.1 above unless extended pursuant to this Section 12.2 or otherwise
herein, the breach by Seller of, or any violation or inaccuracy in, any of the
representations or warranties of the Seller contained in this Agreement or in
any written statement or certificate delivered to Buyer by or on behalf of
Seller on or before
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the Closing pursuant to this Agreement or in connection with the transactions
contemplated hereby.
12.2.2 BREACH OF COVENANT. Without regard to the time
limitations set forth in Section 12.1, any claims or liabilities arising out of
or resulting from any default under or breach of any covenant of Seller
contained herein or in the Real Property Contract or from the non-performance of
any obligations of Seller hereunder or thereunder.
12.2.3 PRODUCT LIABILITY. Without regard to the time
limitations set forth in Section 12.1, any claim for property damage, personal
injury or death on account of product liability claims or assertions made with
respect to actual or alleged defects in designs, materials or workmanship of any
Whole Goods Inventories or Service Parts Inventories manufactured or sold prior
to the Effective Date by Seller or any of Seller's predecessors.
12.2.4 CERTAIN TAXES. Without regard to the time limitations
set forth in Section 12.1, debts, obligations or liabilities, whether absolute,
accrued, contingent or otherwise, for federal, state, county, local, foreign or
other income, sales, real estate, excise, employee payroll or other taxes or
assessments (including interest and penalties thereon, if any) of any kind
whatsoever of Seller.
12.2.5 BULK SALES. Without regard to the time limitations set
forth in Section 12.1, the failure to comply with statutory provisions relating
to bulk sales and transfers, if applicable, in accordance with Section 8.6
hereof.
12.2.6 ENVIRONMENTAL LIABILITY. Without regard to the time
limitations set forth in Section 12.1, any environmental liabilities incurred in
connection with or arising out of or resulting from the presence, release or
disposal of Hazardous Substances, with respect to the
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Real Property at any time on or prior to the date of the Closing and with
respect to the Leased Facilities at any time on or prior to the date of the
Closing (or in the case of any presence, release or disposal by Seller or any
predecessor of Seller or any representative or independent contractor thereof,
with respect to the Real Property or the Leased Facilities at any time prior to
the date of the Closing), whether or not such claims or actions with respect
thereto are described, listed or referred to on any Schedule hereto, and any
Environmental Claims relating to actions, inactions, occurrences or conditions
happening or existing on the Real Property or the Leased Facilities on or prior
to the date of the Closing, whether or not such Environmental Claims, actions,
inactions, occurrences or conditions are described, listed or referred to on any
Schedule hereto. Notwithstanding the foregoing, in the event the Seller fails
to timely restore the Real Property to an "Environmentally Satisfactory
Condition" (as defined in the Real Property Contract) pursuant to Section 3 of
the Real Property Contract and Buyer fails to purchase the Coldwater Plant
and/or the Kewanee Plant as a result thereof, Seller shall have no obligation
pursuant to this Section 12.2 to indemnify Buyer for all or any portion of
Buyer's costs and expenses of moving its operations from the Coldwater Plant
and/or the Kewanee Plant, as the case may be.
12.2.7 REAL PROPERTY. Without regard to the time limitations
set forth in Section 12.1, the breach by Seller of, or any violation or
inaccuracy in, any of the representations or warranties of Seller with respect
to the Real Property contained in this Agreement or the Real Property Contract
or in any written statement or certificate delivered to Buyer by or on behalf of
Seller on or before the Real Property Closing pursuant to this Agreement or the
Real Property Contract or in connection with the transactions contemplated
hereby or thereby. Notwithstanding the foregoing, in the event the Seller
breaches any representation or warranty contained in this Agreement or the Real
Property Contract with respect to any environmental matter and Buyer fails to
purchase the Coldwater Plant and/or the Kewanee Plant as a result
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thereof, Seller shall have no obligation pursuant to this Section 12.2 to
indemnify Buyer for all or any portion of Buyer's costs and expenses of moving
its operations from the Coldwater Plant and/or the Kewanee Plant, as the case
may be.
12.2.8 LIABILITIES OTHER THAN ASSUMED LIABILITIES. Without
regard to the time limitations set forth in Section 12.1, the assertion against
Buyer of any of the liabilities or obligations of Seller other than liabilities
or obligations expressly assumed by Buyer pursuant to Section 4.1 hereof.
12.2.9 SELLER INDEMNIFICATION THRESHOLD. Notwithstanding any
of the provisions of this Section 12.2 to the contrary, Seller shall have no
liability or obligation to make indemnity with respect to matters covered by
Section 12.2.1 hereof (Inaccuracy of Representations, Etc.) (but not otherwise)
until the aggregate of all claims under such Section total $50,000, in which
event such indemnity shall apply to all of such claims in excess of $50,000 and
to all subsequent claims under such Section.
12.3 INDEMNIFICATION BY BUYER. Buyer agrees that, notwithstanding the
Closing and regardless of any investigation made at any time by or on behalf of
Seller or of any information Seller may have in respect thereof (and in addition
to the other specific indemnities of Seller by Buyer hereunder), Buyer will
indemnify, defend and save and hold Seller harmless from and against any claim,
cost, expense, damage, liability, loss or deficiency suffered or incurred by
Seller (including, without limitation, reasonable attorneys' fees and other
reasonable costs and expenses incident to any suit, action or proceeding)
arising out of or resulting from any of the following:
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12.3.1 INACCURACY OF REPRESENTATIONS, ETC. Subject to the
time limitation for survival of representations and warranties set forth in
Section 12.1 above unless extended pursuant to this Section 12.3 or otherwise
herein, the breach by Buyer of, or any violation or inaccuracy in any of the
representations or warranties of the Buyer contained in this Agreement or in any
written statement or certificate delivered to Seller by or on behalf of the
Buyer on or before the Closing or the Real Property Closing pursuant to this
Agreement or in connection with the transactions contemplated hereby.
12.3.2 BREACH OF COVENANT. Without regard to the time
limitations set forth in Section 12.1, any claims or liabilities arising out of
or resulting from any default under or breach of any covenant of Buyer contained
herein or in the Real Property Contract or from the non-performance of any
obligation of Buyer hereunder or thereunder.
12.3.3 PRODUCT LIABILITY. Without regard to the time
limitations set forth in Section 12.1, any claim for property damage, personal
injury or death on account of product liability claims or assertions made with
respect to actual or alleged defects in designs, materials or workmanship for
any Whole Goods Inventories or Service Parts Inventories manufactured on or
after the Effective Date. To the extent practicable, Buyer shall appropriately
distinguish all such Whole Goods Inventories and Service Parts Inventories from
those manufactured by Seller prior to the Effective Date.
12.3.4 CERTAIN TAXES. Without regard to the time limitations
set forth in Section 12.1, debts, obligations or liabilities, whether absolute,
accrued, contingent or otherwise, for federal, state, county, local, foreign or
other income, sales, real estate, excise, employee payroll or other taxes or
assessments (including interest and penalties thereon, if any) of any kind
whatsoever of Buyer.
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12.3.5 ENVIRONMENTAL LIABILITY. Without regard to the time
limitations set forth in Section 12.1, any environmental liabilities incurred in
connection with or arising out of or resulting from the release or disposal of
Hazardous Substances, with respect to the Real Property made at any time after
the date of the Real Property Closing and with respect to the Leased Facilities
at any time after the date of the Closing, and any Environmental Claims relating
to actions, inactions, occurrences or conditions happening on the Real Property
or the Leased Facilities after the date of the Real Property Closing; provided,
however, that Buyer shall have no obligation or liability hereunder, and shall
not indemnify Seller, for any losses incurred by Seller in connection with or
arising out of or resulting from the continuation of any environmental problem
or condition existing at or prior to the Real Property Closing.
12.3.6 OTHER LIABILITIES. Without regard to the time
limitations set forth in Section 12.1, the assertion against Seller of any of
the liabilities of Seller expressly assumed by Buyer pursuant to Section 1.5
hereof and the assertion against Seller of any liability or obligation arising
out of Buyer's operation of the Purchased Assets and the Farm Equipment Business
at any time after the Closing Date, including without limitation, any liability
or obligation arising from any claimed discharge or termination of any White
Dealer.
12.3.7 BUYER INDEMNIFICATION THRESHOLD. Notwithstanding any
of the provisions of this Section 12.3 to the contrary, Buyer shall have no
liability or obligation to make indemnity with respect to matters covered by
clause 12.3.1 (Inaccuracy of Representations, etc). (but not otherwise) until
the aggregate of all claims under such clause total $50,000, in which event this
indemnity shall apply to all of such claims in excess of $50,000 and to all
subsequent claims under such clauses.
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12.4 MISCELLANEOUS. All statements of fact contained in this Agreement
or in any written statement, certificate, schedule or other document delivered
to Seller or Buyer by or on behalf of the other pursuant to this Agreement shall
be deemed representations and warranties of the party making such statements
hereunder.
12.5 COOPERATION. Seller and Buyer will give prompt written notice
(which, as to third party claims, shall be given within the time required to
file a timely response) to the other of any claim which Buyer or Seller
discovers or of which notice is received after the Closing and which might give
rise to a claim by Buyer or Seller against the other under Sections 12.2 or 12.3
hereof, stating the nature, basis and amount thereof. In case of any claim by a
third party, any suit, any claim by any governmental body, or any legal,
administrative arbitration proceeding ("Third Party Claim") with respect to
which Seller or Buyer may have liability under the indemnity agreements
contained in Sections 12.2 and 12.3 hereof, the party which may have such
liability to the other shall be entitled to participate therein, and to the
extent desired, to assume the defense thereof, and after notice from Seller or
Buyer of its election so to assume the defense thereof, the assuming party will
not be liable to the other for any legal or other expenses subsequently incurred
by the other in connection with the defense thereof, unless the assuming party
does not actually assume the defense thereof following notice of such election.
Buyer or Seller shall make available to the other and its attorneys and
accountants, at all reasonable times, all books and records relating to such
suit, claims or proceeding, and Buyer and Seller will render to each other such
assistance as may reasonably be required of each in order to insure proper and
adequate defense of any such Third Party Claim. If the indemnifying party shall
not notify the indemnified party of the indemnifying party's election to defend
any Third Party Claim (and, in the case of litigated Third Party Claims,
actually assume the defense of such Third Party Claim), the indemnified party
may defend against such Third Party Claim in such manner as it may deem
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appropriate and if the indemnified party shall desire to settle such Third Party
Claims, it shall give the indemnifying party prior written notice of the
proposed settlement. Within 10 days following receipt by the indemnifying party
of such written notice, the indemnifying party shall notify the indemnified
party whether or not it consents to such settlement (which consent shall not
unreasonably be withheld). If the indemnifying party elects to defend any Third
Party Claim, and has actually assumed the defense of such Third Party Claim, the
indemnified party shall not settle the Third Party Claim without the written
consent of the indemnifying party (which consent shall not unreasonably be
withheld) and the indemnifying party shall not in the defense of any such Third
Party Claim consent to the entry of any judgment against or affecting the
indemnified party (other than a judgment of dismissal on the merits and without
costs or involving only the payment of money) except with the written consent of
the indemnified party (which consent shall not unreasonably be withheld) or
enter into any settlement, except one involving only the payment of money,
unless with the written consent of the indemnified party (which consent shall
not unreasonably be withheld).
13. NON-COMPETITION; NON-SOLICITATION OF EMPLOYEES.
13.1 SCOPE OF NON-COMPETITION. During the period beginning on the
date of the Closing and ending five (5) years thereafter, Seller, and any
corporation or other entity owned or controlled by Seller, shall not (except for
the manufacture and sale of Bush Hog disc mowers and Lilliston row crop
cultivators), unless acting with the prior written consent of Buyer,
manufacture, market or distribute Farm Equipment or Farm Equipment Parts either
as an owner, consultant, manager, associate, partner, agent or otherwise, or by
means of any corporate or other device within:
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(a) the United States of America; or
(b) any state of the United States of America in which the Buyer or
any affiliate of the Buyer is engaged in the manufacture or marketing of
Farm Equipment or Farm Equipment Parts; or
(c) any country other than the United States of America in which the
Buyer or any affiliate of the Buyer is engaged in the manufacture or
marketing of Farm Equipment or Farm Equipment Parts;
13.2 NON-SOLICITATION OF EMPLOYEES. During the period beginning on
the date of the Closing and ending one (1) year thereafter, Seller, and any
corporation or other entity owned or controlled by Seller, shall not, either for
itself or in conjunction with or on behalf of any other person or entity,
solicit, divert or hire, or attempt to solicit, divert or hire, any employees of
Buyer, whether acquired pursuant to Section 8.5.1 hereof or otherwise.
13.3 INJUNCTIVE RELIEF. Seller acknowledges that the restrictions
contained in this Section 13 are reasonable and necessary to protect the
legitimate interests of the Buyer and its affiliates, and that any violations of
any provision of this Section 13 will result in irreparable injury to Buyer and
its affiliates and that, therefore, Buyer and its affiliates shall be entitled
to preliminary and permanent injunctive relief in any court of competent
jurisdiction and to an equitable accounting of all earnings, profits and other
benefits arising from such violation, which rights shall be cumulative and in
addition to any other rights or remedies to which the Buyer or its affiliates
may be entitled.
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14. MISCELLANEOUS.
14.1 NOTICES. All notices, requests, demands and other communications
required or permitted to be given hereunder shall be by hand-delivery, first
class air mail, telex, telecopier, or air courier to the parties set forth
below. Such notices shall be deemed given: at the time delivered by hand, if
personally delivered; seven business days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt
acknowledged, if telecopied; and the third business day after timely delivery to
the courier, if sent by air courier.
If to Seller: Allied Products Corporation
10 South Riverside Plaza
Chicago, Illinois 60606
Telecopy: 312-454-9608
Telephone: 312-454-1020
With copies to: David B. Corwine, Esq.
Allied Products Corporation
10 South Riverside Plaza
Chicago, Illinois 60606
Telecopy: (312) 454-9608
Telephone: (312) 454-1020
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and William L. Morrison, Esq.
Gardner, Carton & Douglas
321 North Clark Street, Suite 3400
Chicago, Illinois 60610-4795
Telecopy: (312) 644-3381
Telephone: (312) 644-3000
If to Buyer: Michael F. Swick, Esq.
AGCO Corporation
5295 Triangle Parkway
Norcross, Georgia 30092
Telecopy: (404) 246-6158
Telephone: (404) 246-6115
14.2 EXPENSES; SALES AND USE TAXES. Regardless of whether the
transactions provided for in this Agreement are consummated, each party hereto
shall pay its own expenses incident to this Agreement and to preparing to
consummate the transactions provided for herein. Any sales, use, transfer or
similar taxes imposed as a result of the sale of the Purchased Assets (other
than the Real Property) hereunder shall be borne one-half by Seller and one-half
by Buyer.
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14.3 GOVERNING LAW. Except as otherwise provided herein, this
Agreement shall be governed by and construed in accordance with the laws of the
State of Georgia, excluding any choice of law rules which may direct the
application of the laws of another jurisdiction.
14.4 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of the parties hereto, and their successors and permitted
assigns; provided, however, that an assignment or attempted assignment of all or
a portion of any party's rights hereunder shall not relieve such party of its
obligations hereunder; and provided further, that neither party shall assign its
rights or obligations herein to any person or entity without the prior written
consent of the other party hereto.
14.5 NO THIRD PARTY BENEFICIARIES. Nothing in this Agreement is
intended nor shall it be construed as giving any person, firm, corporation or
other entity, other than the parties hereto and their successors and permitted
assigns, any right, remedy or claim under or in respect of this Agreement or any
provision hereof.
14.6 EXECUTION IN COUNTERPARTS. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original agreement, but all of which together shall constitute one and the same
instrument.
14.7 TITLES AND HEADINGS. Titles and headings to sections herein are
for purposes of reference only, and shall in no way limit, define, or otherwise
affect the provisions herein.
14.8 ENTIRE AGREEMENT. This Agreement and the other agreements
referred to herein, including the Schedules and exhibits attached hereto (which
are incorporated herein by
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this reference) or referred to herein shall constitute the entire agreement
among the parties with respect to the matters covered hereby and shall supersede
all previous written, oral or implied understandings among them with respect to
such matters.
14.9 AMENDMENT AND MODIFICATION. This Agreement may be amended,
modified or supplemented only by mutual consent set forth in a writing duly
signed by the parties hereto.
14.10 PUBLIC ANNOUNCEMENT. No party shall publicly disclose this
Agreement or any dealings between or among the parties in connection with the
subject matter hereof without the prior approval of the other, except as may be
required by law.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of
the day and year first above written.
ALLIED PRODUCTS CORPORATION
By: /s/ Kenneth B. Light
___________________________________
Title: Executive Vice President
_______________________________
AGCO CORPORATION
By: /s/ Robert J. Ratliff
_______________________________
Title: President
______________________________
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Exhibit(c)(2)(a)(ii)
LIST OF EXHIBITS AND DISCLOSURE SCHEDULES
The following is a list of Exhibits and Schedules to the Agreement for
the Sale of Assets of the White-New Idea Farm Equipment Division of Allied
Products Corporation dated as of November 8, 1993 by and between AGCO
Corporation ("AGCO") and Allied Products Corporation ("Allied") (the "Sale
Agreement"):
1. EXHIBIT A - Coldwater Lease Agreement by and between Allied as lessor
and AGCO as lessee to lease the plant located in Coldwater, Ohio.
2. EXHIBIT B - Kewanee Lease Agreement by and between Allied as lessor
and AGCO as lessee to lease the plant located in Kewanee, Illinois.
3. SCHEDULE 1.1 - FARM EQUIPMENT PRODUCTS AND ACCESSORIES.
Cross-references Schedule 5.7, which describes the products and
accessories included in the Purchased Assets (as defined in the Sale
Agreement).
4. SCHEDULE 1.2.1 - TOOLING. Refers to a representative list of tooling
that is included in the Purchased Assets.
5. SCHEDULE 1.2.3 - MACHINERY AND EQUIPMENT. Contains an unaudited list
of fixed assets included in the Purchased Assets.
6. SCHEDULE 1.2.4 - REAL PROPERTY LEASES. Lists the addresses of three
leased warehouses assigned to AGCO. Refers to parking lot lease being
sublet by Allied to AGCO.
7. SCHEDULE 1.2.5 - PROPRIETARY RIGHTS. Lists trade names and associated
trademarks and logos and also cross-references all intellectual property
listed on Schedule 5.6.2.
8. SCHEDULE 1.5.1 - STANDARD WARRANTY GIVEN IN CONNECTION WITH THE SALE OF
FARM EQUIPMENT AND FARM EQUIPMENT PARTS. Describes White-New Idea's
standard warranties with example attached.
9. SCHEDULE 1.5.2 - SELLER'S DEALER PERFORMANCE BONUS PROGRAM. Describes
incentive performance bonuses paid to dealers for achieving certain
sales targets.
10. SCHEDULE 3.1.1 - FORMS OF WHITE DEALER AGREEMENT/NEW IDEA AGREEMENT.
Includes copies of standard Dealer Agreements.
11. SCHEDULE 3.1.2 - NON-STANDARD DEALER AGREEMENTS AND NAME AND LOCATION
OF EACH CORRESPONDING DEALER. Describes relationship with one dealer
who does not have a written Dealer Agreement. This Schedule includes a
copy of the Security Agreement with that dealer.
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12. SCHEDULE 3.1.1 - NAME, LOCATION, PURCHASES AND SETTLEMENTS FOR EACH
DEALER PURSUANT TO ITS DEALER AGREEMENT. Lists the name, location,
purchases and settlements for each dealer.
13. SCHEDULE 5.2 - JURISDICTIONS WHERE SELLER IS QUALIFIED TO DO BUSINESS.
Lists 40 states where Allied is qualified to do business.
14. SCHEDULE 5.3.1 - RESTRICTIONS. Describes consents required to proceed
with the sale of White-New Idea.
15. SCHEDULE 5.3.2 - CONSENTS. Describes consents required to proceed
with the sale of White-New Idea.
16. SCHEDULE 5.4.1 - CONFLICTS OR VIOLATIONS BY ENTERING INTO TRANSACTIONS
CONTEMPLATED BY THE AGREEMENT. Describes consents required to proceed
with the sale of White-New Idea.
17. SCHEDULE 5.4.2 - CONSENTS OR APPROVALS REQUIRED BY SELLER. Describes
consents required to proceed with the sale of White-New Idea.
18. SCHEDULE 5.5 - EXCEPTIONS TO GOOD AND MARKETABLE TITLE FOR PURCHASED
ASSETS. Lists and describes exceptions to good and marketable title
for the Purchased Assets.
19. SCHEDULE 5.6.1 - TRADE NAMES. Lists trade names and brand names used
in connection with the White-New Idea Farm Equipment Business.
Cross-references Schedule 5.6.2.
20. SCHEDULE 5.6.2 - TRADEMARKS, TRADENAMES, PATENTS AND APPLICATIONS
THEREFOR. Lists all of the above-captioned intellectual property being
purchased.
21. SCHEDULE 5.6.3 - INTELLECTUAL PROPERTY RIGHTS OWNED BY THIRD PARTIES.
Lists intellectual property licensing agreements from third parties.
22. SCHEDULE 5.6.4 - ROYALTY PAYMENTS. Lists the amount of royalty
payments due pursuant to the intellectual property license agreements.
23. SCHEDULE 5.6.5 - LICENSES OR AGREEMENTS FOR INTELLECTUAL PROPERTY
RIGHTS. Lists intellectual property licensing agreements to third
parties and from third parties.
24. SCHEDULE 5.7 - DEALER LIST PRICES. Lists suggested dealer prices for
equipment and parts.
25. SCHEDULE 5.8 - EXCEPTIONS TO GENERALLY ACCEPTED ACCOUNTING PRINCIPLES.
Describes variances from GAAP used in preparing financial statements for
Allied.
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26. SCHEDULE 5.9.1 - WHOLE GOODS INVENTORIES. Lists whole goods
inventories.
27. SCHEDULE 5.9.2 - PRODUCTION INVENTORY/SERVICE PARTS INVENTORY
LOCATIONS. Lists locations where inventory and parts are located,
including "action" inventory.
28. SCHEDULE 5.12 - CUSTOMERS, DISTRIBUTORS AND SUPPLIERS. Lists vendors
and export distributors.
29. SCHEDULE 5.13.1 - DEALER CONTRACTS. Lists contract dealers.
30. SCHEDULE 5.13.2 - LIQUIDATED OR CONTINGENT LIABILITIES OWED TO DEALER.
Lists liquidated or contingent liabilities owed to dealers, of which
there are none.
31. SCHEDULE 5.14 - CONTRACTS. Lists material contracts.
32. SCHEDULE 5.16 - PURCHASE COMMITMENTS AND OUTSTANDING BIDS. Lists
sales backlog.
33. SCHEDULE 5.18 - ENVIRONMENTAL MATTERS. Describes certain
environmental matters concerning the Coldwater, Ohio and Kewanee,
Illinois plants, none of which is deemed to be material to the White-New
Idea business.
34. SCHEDULE 5.19 - LITIGATION. Describes litigation and pending claims,
none of which is material to the White-New Idea business.
35. SCHEDULE 5.21 - OFFICES OF SELLER AND LOCATIONS OF PURCHASED ASSETS.
Lists addresses of offices and warehouses used in connection with the
White-New Idea business.
36. SCHEDULE 8.5.1 - EMPLOYMENT. Lists employees of White-New Idea who
are not being offered employment by Buyer, of which there are none.
37. SCHEDULE 10.1.2 - BANK CONSENTS. Lists the names and addresses of
each of the banks comprising Allied's bank group of lenders whose
consent is required.
Allied will furnish supplementally a copy of any of the Exhibits or
Schedules listed above at the request of the Securities and Exchange
Commission.
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