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: April 15, 1996
PUBLICKER INDUSTRIES INC.
(Exact name of registrant as specified in its charter)
Pennsylvania
(State of incorporation)
1-3315 23-0991870
(Commission file number) (I.R.S. Employer
Identification No.)
1445 East Putnam Avenue
Old Greenwich, Connecticut 06870
(Address of principal executive offices) (Zip code)
(203) 637-4500
(Registrant's telephone number, including area code)
<PAGE>
Item 2. Acquisition or Disposition of Assets
On March 29, 1996, Publicker Industries Inc. (the
"Company") sold substantially all of the assets of its
Fenwal Electronics, Inc. ("Fenwal") subsidiary to
Elmwood Sensors, Inc. ("Elmwood") for $25.3 million in
cash, subject to certain post-closing adjustments which
are not expected to be material.
The assets sold include accounts receivable,
inventories, machinery, equipment and miscellaneous
furniture and fixtures. Elmwood assumed certain
liabilities of Fenwal including trade accounts payable,
certain accrued liabilities and equipment financing
related debt and certain contractual liabilities.
Fenwal, headquartered in Milford, Massachusetts,
manufactures and sells thermistors and thermistor
assemblies. The Company acquired Fenwal from an
affiliate of Hanson PLC in December 1990.
Item 7. Financial Statements and Exhibits
(b) Pro forma financial information
On February 16, 1996, the Company sold substantially all
of the assets of its Bright Star Industries,
Incorporated ("Bright Star") subsidiary for $5.5
million, subject to certain post-closing adjustments
which are not expected to be material. Bright Star has
been reflected as a discontinued operation in the
consolidated financial statements included in the
Company's 1995 Form 10-K. Bright Star manufactures and
sells, flashlights, lanterns and batteries.
The following unaudited pro forma financial statements
give effect to the disposition
by the
Company of
substantially all of the
assets of
its Fenwal
and Bright Star
subsidiaries. The pro
forma financial
information
is based on
the
historical
financial
statements
of the
Company,
adjusted to
give effect
to the
dispositions
of Fenwal
and Bright
Star, and on
estimates
and
assumptions
set forth
below and in
the
accompanying
notes.
The pro forma condensed balance sheet gives effect to
the transactions as if they had occurred as of December
31, 1995. The pro forma condensed statement of income
(loss) for the year ended December 31, 1995 gives effect
to the dispositions as if they had occurred as of
January 1, 1995.
The pro forma adjustments are based on estimates,
available information and certain assumptions made by
management.
The pro forma condensed balance sheet and statement of
income (loss) are not necessarily indicative of future
operations or the actual results that would have
occurred had the dispositions been consummated at the
dates indicated above. The pro forma financial
information should be read in conjunction with the
Company's historical financial statements and notes
thereto included in the Company's 1995 Form 10-K.
<PAGE>
PUBLICKER INDUSTRIES INC.
AND SUBSIDIARY COMPANIES
PRO FORMA CONDENSED BALANCE SHEET AS OF
DECEMBER 31, 1995
(in thousands of dollars)
Eliminate
Fenwal
Electronics Pro forma Pro forma
Historical Inc. Adjustments (a) Balances
ASSETS
Cash $ 874 $ - $ 16,988 $ 17,862
Restricted cash 4,500 - - 4,500
Trade receivables 8,931 (2,298) - 6,633
Inventories 7,286 (2,745) - 4,541
Net assets of
discontinued operations 4,579 6,563 (11,142) -
Other 895 (56) - 839
Total current assets 27,065 1,464 5,846 34,375
Property, plant
& equipment 11,302 (3,385) - 7,917
Less accumulated
depreciation 3,595 (1,128) - 2,467
7,707 (2,257) - 5,450
Goodwill 7,861 (3,226) - 4,635
Other assets 2,557 (354) (42) 2,161
$ 45,190 $ (4,373) $ 5,804 $ 46,621
LIABILITIES AND SHAREHOLDERS' EQUITY
Current maturities of
long-term debt $ 11,235 $ (955) $ (9,801) $ 479
Accounts payable 6,240 (1,005) - 5,235
Accrued liabilities 15,378 (1,624) 1,357 15,111
Total current
liabilities 32,853 (3,584) (8,444) 20,825
Long-term debt 3,458 (706) - 2,752
Other non-current
liabilities 11,473 (83) - 11,390
Total liabilities 47,784 (4,373) (8,444) 34,967
Shareholders' equity
Common shares 1,541 - - 1,541
Additional paid-
in capital 42,488 - - 42,488
Accumulated deficit (42,732) - 14,248 (28,484)
Common shares held
in treasury (3,891) - - (3,891)
Total shareholder's
equity (2,594) - 14,248 11,654
$ 45,190 $ (4,373) $ 5,804 $ 46,621
(a) The pro forma adjustments reflect the disposition of Bright Star
(which was reflected as a discontinued operation in the historical
financial statements) and Fenwal as of December 31, 1995 and assume
that the estimated proceeds from the dispositions, net of
disposition costs and extinguishment of liabilities retained by the
Company, of $26,897,000 were used to (i) pay down debt of
$2,366,000, (ii) redeem the Company's 13% Subordinated Notes of $7.5
million plus accrued interest and (iii) writeoff debt discount and
issuance costs related to the 13% Subordinated Notes. A pro forma
adjustment was also reflected to establish the estimated tax
liability related to the dispositions.<PAGE>
PUBLICKER INDUSTRIES INC.
AND SUBSIDIARY COMPANIES
PRO FORMA CONDENSED STATEMENT OF INCOME (LOSS)
FOR THE YEAR ENDED DECEMBER 31, 1995
(in thousands of dollars)
Eliminate
Fenwal
Electronics Pro forma Pro forma
Historical Inc. Adjustments (a) Balances
Net sales $ 66,290 $ (19,573) $ - $ 46,717
Costs and expenses:
Costs of sales 48,509 (13,509) - 35,000
Selling expenses 4,219 (1,970) - 2,249
General & admini-
strative expenses 11,319 (1,730) (79) 9,510
64,047 (17,209) (79) 46,759
Income (loss) from
operations 2,243 (2,364) 79 (42)
Other (income) expenses:
Interest income (138) - (399) (537)
Interest expense 2,181 (62) (1,849) 270
Cost of pensions-
non operating 744 - - 744
Legal settlements and costs 365 - - 365
Gain from repurchase
of notes (75) - 75 -
3,077 (62) (2,173) 842
Income (loss) from
continuing operations $ (834) $ (2,302) $ 2,252 $ (884)
Earnings (loss) per common share from
continuing operations $ (0.06) $ (0.06)
Weighted average number of shares
outstanding (in thousands) 14,761 14,761
(a) The pro forma adjustments reflect the disposition of Bright Star
(which was reflected as a discontinued operation in the historical
financial statements) and Fenwal as of January 1, 1995, and assume
(i) a reduction of interest expense related to the pay down of the
Company's 13% Subordinated Notes and bank debt, (ii) elimination of
amortization of debt discount and issuance costs and the gain on
repurchase of notes related to the 13% Subordinated Notes and (iii)
the increase in interest income from investing the excess of the
proceeds received on the sale of Bright Star and Fenwal over the pay
down of debt.
(c) Exhibits
Exhibit 10.1 - Asset Purchase Agreement among Fenwal
Electronics, Inc., Publicker Industries Inc. and Elmwood
Sensors, Inc. dated March 29, 1996.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
PUBLICKER INDUSTRIES INC.
/s/Antonio L. DeLise
Antonio L. DeLise
Vice President,
Chief Financial Officer
and Secretary
Dated: April 15, 1996<PAGE>
ASSET PURCHASE AGREEMENT
AMONG
FENWAL ELECTRONICS, INC.,
PUBLICKER INDUSTRIES INC.
AND
ELMWOOD SENSORS, INC.
MARCH 29, 1996
<PAGE>
TABLE OF CONTENTS
Page
1. Interpretation. . . . . . . . . . . . . . . . .1
A. Definitions. . . . . . . . . . . . . . . .1
2. Sale of Assets and Assumption of Liabilities. .2
A. Assets Sold and Retained.. . . . . . . . .3
1. Assets Purchased. . . . . . . . . . .3
2. Assets Retained.. . . . . . . . . . .4
3. Transfers of Personal Property Leases, Real
Property Leases
and Contracts. 5. . . . . . . . . . .
4. Transfer of Know-How. . . . . . . . .5
B. Assignment of Intellectual Property Rights.5
C. Risk of Loss.. . . . . . . . . . . . . . .5
D. "As Is" Condition. . . . . . . . . . . . .5
E. Assumption of Contractual Rights and Obligations Related
Thereto.. . . . . . . . . . . . . . .5
F. Assumption of Certain Liabilities by Buyer.6
G. All Other Liabilities Excluded.. . . . . .7
3. Purchase Price; Payment; Adjustment.. . . . . .8
A. Purchase Price.. . . . . . . . . . . . . .8
1. Price.. . . . . . . . . . . . . . . .8
2. Allocation. . . . . . . . . . . . . .8
B. Payment of Purchase Price. . . . . . . . .9
C. Adjustment to and Payment of the Balance of the Purchase
Price. . . . . . . . . . . . . . . .9
D. Closing Date.. . . . . . . . . . . . . . 10
E. Waiver of Bulk Transfer Provisions.. . . 10
4. Representations and Warranties of Seller and Shareholder.11
A. Title to Assets. . . . . . . . . . . . . 11
B. Organization and Qualification.. . . . . 11
C. Power and Authority. . . . . . . . . . . 11
D. Approvals and Consents; Noncontravention.11
E. Tax Returns; Withholdings. . . . . . . . 12
F. Compliance with Laws.. . . . . . . . . . 12
G. Litigation.. . . . . . . . . . . . . . . 12
H. Financial Statements.. . . . . . . . . . 12
I. Absence of Undisclosed Liabilities.. . . 13
J. Personnel. . . . . . . . . . . . . . . . 13
1. Compensation Increases. . . . . . . 13
2. Compensation and Benefit Plans. . . 13
K. Contracts. . . . . . . . . . . . . . . . 13
L. Employment.. . . . . . . . . . . . . . . 14
M. Intellectual Property Rights.. . . . . . 14
N. Insurance Policies.. . . . . . . . . . . 14
O. Environmental Matters. . . . . . . . . . 14
1. Definitions.. . . . . . . . . . . . 14
2. Environmental Representations and Warranties of
Seller
and Shareholder. .15. . . . . . . . .
P. Absence of Certain Changes.. . . . . . . 16
Q. Purchased Assets Complete. . . . . . . . 16
5. Representations and Warranties of Buyer.. . . 16
A. Organization and Qualification.. . . . . 17
B. Power and Authority. . . . . . . . . . . 17
C. Approvals and Consents; Noncontravention.17
D. Financial Capacity to Close. . . . . . . 17
6. Covenants.. . . . . . . . . . . . . . . . . . 17
A. Publicity. . . . . . . . . . . . . . . . 17
B. Retention of and Access to Books and Records.17
C. HSR Act. . . . . . . . . . . . . . . . . 18
D. Covenants of Seller and Shareholder. . . 18
1. 401(k) Plan.. . . . . . . . . . . . 18
2. Protection of Confidential Information. 19
3. Solicitation of Employees.. . . . . 19
4. Intellectual Property.. . . . . . . 19
5. Name. . . . . . . . . . . . . . . . 19
6. Maintenance of Business Prior to Closing.19
7. Significant Product Failure.. . . . 19
E. Covenants of Buyer.. . . . . . . . . . . 20
1. Employment. . . . . . . . . . . . . 20
7. Taxes.. . . . . . . . . . . . . . . . . . . . 20
A. Pre-Closing Taxes. . . . . . . . . . . . 20
B. Post-Closing Taxes.. . . . . . . . . . . 20
8. Indemnification.. . . . . . . . . . . . . . . 20
A. Seller's and Shareholder's Indemnity. . 20
B. Buyer's Indemnity. . . . . . . . . . . . 21
C. Indemnity Procedure. . . . . . . . . . . 22
1. If By Seller and Shareholder. . . . 22
2. If By Buyer.. . . . . . . . . . . . 22
D. Limitations of Indemnities.. . . . . . . 23
E. Remedies.. . . . . . . . . . . . . . . . 23
9. Closing Conditions. . . . . . . . . . . . . . 23
A. Conditions to Seller's Obligations. . 23
1. Representations, Warranties and Covenants.24
2. Consents. . . . . . . . . . . . . . 24
3. No Governmental Proceedings or Litigation.24
4. Certificates. . . . . . . . . . . . 24
5. Corporate Documents.. . . . . . . . 24
B. Conditions to Buyer' Obligations.. . . 24
1. Representations, Warranties and Covenants.24
2. Consents. . . . . . . . . . . . . . 25
3. No Governmental Proceedings or Litigation.25
4. Certificates. . . . . . . . . . . . 25
5. Corporate Documents.. . . . . . . . 25
10. Closing Documents.. . . . . . . . . . . . . . 25
A. Provided by Buyer. . . . . . . . . . . . 25
1. Funds.. . . . . . . . . . . . . . . 25
2. Assumptions.. . . . . . . . . . . . 25
3. Secretary's Certificates.. . . . 25
B. Provided By Seller.. . . . . . . . . . . 25
1. Assignments and Bills of Sale.. . . 26
2. Secretary's Certificates. . . . . . 26
11. Miscellaneous.. . . . . . . . . . . . . . . . 26
A. Termination. . . . . . . . . . . . . . . 26
B. Successors and Assigns.. . . . . . . . . 26
C. Governing Law. . . . . . . . . . . . . . 26
D. Expenses.. . . . . . . . . . . . . . . . 26
E. Force Majeure. . . . . . . . . . . . . . 26
F. Severability.. . . . . . . . . . . . . . 26
G. Brokers' and Finders' Fees. . . . . . 26
H. Notices. . . . . . . . . . . . . . . . . 27
I. Amendments; Waivers. . . . . . . . . . . 28
J. Entire Agreement.. . . . . . . . . . . . 28
K. Further Matters. . . . . . . . . . . . . 28
L. Parties in Interest. . . . . . . . . . . 28
M. Survival.. . . . . . . . . . . . . . . . 28
N. Section and Paragraph Headings.. . . . . 28
O. Counterparts.. . . . . . . . . . . . . . 28
<PAGE>
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this "Agreement") is made this
29th day of March, 1996 among Fenwal Electronics, Inc., a Delaware
corporation with its principal executive offices at 450 Fortune
Boulevard, Milford, Massachusetts 10767 as seller ("Seller"),
Publicker Industries Inc., a Pennsylvania corporation with its
principal executive offices at 1445 East Putnam Avenue, Old
Greenwich, Connecticut 06870, ("Shareholder"), and Elmwood
Sensors, Inc., a Rhode Island corporation with its principal
executive offices at 500 Narragansett Park Drive, Pawtucket, Rhode
Island 02861, as buyer ("Buyer").
RECITALS:
WHEREAS, Seller is engaged in the "Business" (as hereinafter
defined);
WHEREAS, Seller is an indirect subsidiary of Shareholder; and
WHEREAS, Seller desires to sell, transfer and assign to Buyer,
and Buyer desires to purchase and acquire from Seller, on the terms
and subject to the conditions set forth in this Agreement,
substantially all of the assets used in the conduct of the Business.
NOW, THEREFORE, in consideration of the mutual
covenants and agreements hereinafter set forth, and intending to be
legally bound, the parties hereto agree as follows:
1.Interpretation.
A.Definitions. As used in this Agreement, the following terms
shall have the following meanings:
"Business" shall mean the business in which the Seller is
engaged on the Closing Date, as described in Schedule 1.A.1. hereto,
at the locations listed in Schedule 1.A.2. hereto.
"Know-How" shall mean all know-how and information (not
necessarily proprietary) used by Seller in the Business on the
Closing Date including, without limitation, (1) design
drawings, (2) specifications and performance criteria (3) operating
instructions and maintenance manuals, (4) manufacturing information
including production documentation, methods, layouts and supplier
and cost information, (5) copies of on-site computer software and
related documentation, including, without limitation, source and
object code to the extent available, (6) prototypes, models or
samples, (7) files relating to applications for Intellectual
Property Rights, and (8) all files relating to customers and other
tangible materials that are used in the Business on the Closing
Date.
"Copy Rights" shall mean all published and unpublished
rights in works of authorship including, without limitation,
(1) literary works, including books, periodicals, catalogs,
directories, textual advertising such as brochures, pamphlets and
other literature, tabular lists, lectures, manuals and computer
programs and data bases; (2) pictorial, graphic and sculptural
works, including maps, architectural plans and renderings,
blueprints, photographs, prints and pictorial illustrations
such as labels and pictorial advertising, posters, brochures and
pamphlets, and pattern designs; (3) audiovisual works; (4)
sound/recordings; and (5) mask works, and all U.S. pending and
issued copyright or mask work registrations thereon.
"Fenwal Caribbean" shall mean Fenwal Electronics Caribbean
Limited.
"Fenwal UK" shall mean Fenwal Electronics UK Ltd.
"Patent Rights" shall mean all (1) rights to
inventions/conceived on or before the Closing Date by employees of
any member of the Seller Group who are engaged solely in the
operation of the Business; (2) pending U.S. applications owned by
any member of the Seller Group (including those set forth on
Schedule 1.A.3); and (3) U.S. patents owned by any member of the
Seller Group, or for which any member of the Seller Group has the
right to apply for as of the Closing Date (including those set forth
on Schedule 1.A.3).
"Seller Group" shall mean Seller, Fenwal Caribbean and Fenwal
UK.
"Trademarks" shall mean trade names, trademarks, service
marks, trade dress and product configurations that are used by the
Seller to identify the Business or any part thereof and all (1)
goodwill and associated common law rights; (2) registration
applications pending thereon in any province, state or country
(including those set forth on Schedule 1.A.3); and (3) registrations
issued thereon (including those set forth on Schedule 1.A.3).
"Trade Secrets" shall mean all proprietary information that
is used by the Seller in the Business and that (1) derives
independent economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by, third
parties who can obtain economic value from its disclosure or use and
(2) is the subject of efforts by the Seller that were reasonable
under the circumstances to maintain its secrecy, such as, without
limitation, proprietary specifications, formulas, drawings,
models, blueprints, software, production techniques and
processes, retail and wholesale customer lists, vendor lists,
compilations, merchandising information, cost and pricing
information, business systems and methods.
"Intellectual Property Rights" shall mean the Patent Rights,
Copy Rights, Trademarks and Trade Secrets as more fully described
herein and other similar rights in technology that are in each case
used by the Seller in the Business, including, without limitation,
those items set forth in Schedule 1.A.3 hereto.
2.Sale of Assets and Assumption of Liabilities.
A.Assets Sold and Retained.
1.Assets Purchased. At the Closing, Seller agrees to sell,
transfer, convey, assign and deliver to Buyer and Buyer agrees to
purchase and acquire, according to the terms and conditions of this
Agreement, all of Seller's right, title, and interest in and to all
of the assets and properties used in the Business on the Closing
Date, other than the assets identified in Section 2.A.2 hereof
(collectively, the "Purchased Assets"), including, without
limitation, the following:
a.all personal property leases listed on Schedule 2.A.1.a hereto
(the "Personal Property Leases") and all real property leases listed
on Schedule 2.A.1.a hereto (the "Real Property Leases") and all
leasehold improvements and structures on the real property leased
thereby, except, in each case, to the extent such leases do not
constitute Transferred Rights, Obligations and Agreements (as
defined below);
b.all contracts of the Business, including, without limitation,
customer contracts, royalty and license agreements and rights,
purchase agreements, rights to use technology owned by others and
certain other agreements listed on Schedule 2.A.1.b (collectively,
the "Contracts"), except to the extent any such Contracts do not
constitute Transferred Rights, Obligations and Agreements;
c.all prepaid expenses and deposits of the Business;
d.all accounts receivable of the Business or other rights to
receive payment for services provided by the Business as of the
Closing Date (the "Closing Date Receivables");
e.all inventory of supplies, raw materials, component parts,
work-in-progress and finished goods of the Business on hand (the
"Inventory");
f.all machinery, equipment, spare parts, fittings, supplies and
other tangible personal property used in the Business at the
locations identified in Schedule l.A.2 hereto.
g.all on-site computer hardware and software owned by the Seller and
used in the Business at the locations identified in Schedule l.A.2
hereto (the "Computer Hardware and Software");
h.all goodwill of the Business;
i.the Know-How;
j.the Intellectual Property Rights and all business names, including
the right to use the name "Fenwal Electronics, Inc." or derivations
thereof in the conduct of the Business and other intangible assets
relating to the Business set forth on Schedule 1.A.3 attached
hereto;
k.all operating data, books and records of Seller, including
customer lists and information, relating to customers and
suppliers, with respect to the Business;
l.to the extent assignment to the Buyer is permitted by law or
contract, all rights, licenses, permits, and other operating
agreements with respect to the Seller's right to provide services of
the Business at the locations identified in 1.A.2 hereto or for
which the Seller is the licensee, including those set forth on
Schedule. 2.A.1.l attached hereto (the "Licenses and Permits");
m.all issued and outstanding capital stock of Fenwal Caribbean and
Fenwal UK;
n.all cash and cash equivalents of Fenwal Caribbean and Fenwal UK;
and
o.all other assets, whether tangible or intangible that are used by
Seller in the Business at the locations identified in Schedule 1.A.2
hereto except as excluded by Section 2.A.2 (the "Other Assets").
2.Assets Retained. Notwithstanding the provisions of Section
2.A.1, the Seller is not selling, assigning, transferring or
conveying to Buyer the following assets of Seller or any affiliate
of Seller (including Fenwal Caribbean and Fenwal UK), which shall be
excluded from the transactions contemplated by this Agreement (the
"Excluded Assets"):
a.all receivables from Shareholder or any of its subsidiaries or
affiliates;
b.all cash, cash equivalents and investment securities (other than
cash and cash equivalents held by Fenwal Caribbean and Fenwal UK);
c.all prepaid expenses and deposits of the Business to the extent
not included in the Closing Date Balance Sheet;
d.all pension plan and 401(k) plan assets, including, without
limitation, any assets in any "frozen pension" plan;
e.insurance policies, except for those policies specifically listed
on Schedule 2.A.2.e; and
f.all Federal, state, local or other tax refunds, including, without
limitation, refunds of income, sales, use, franchise, property,
payroll or other taxes and refunds of any penalties or interest with
respect to any of the foregoing, relating to periods prior to the
Closing Date.
3.Transfers of Personal Property Leases, Real Property Leases and
Contracts. To facilitate the assignment or transfer of Personal
Property Leases, Real Property Leases and Contracts, the Seller
Group shall execute such documents of assignment or transfer as may
be prepared by Buyer and reasonably acceptable to Seller (and which
shall not impose any liability or obligation on Shareholder or any
member of the Seller Group except as expressly provided in this
Agreement) that are necessary or appropriate for evidencing
or recording the assignments or transfers to Buyer. Subject to the
terms of Section 2.E hereof, in the event any assignment or
transfer of any Personal Property Lease, Real Property Lease or
Contract cannot be obtained, Seller and Buyer shall enter into a
mutually satisfactory license, sublicense, lease, or independent
contractor agreement, agency or other relationship with respect
hereto with the intent of providing the same benefits and
obligations to Buyer as if such assignment had occurred.
4.Transfer of Know-How. The communication of transferred Know-How
from Seller to Buyer shall occur primarily through Buyer's
acquisition of property and engagement of Seller's personnel,
provided that Seller shall have no responsibility to insure that any
of its employees become the employees of Buyer. In addition, in
order to facilitate the transfer of such Know-How, Seller shall use
reasonable efforts, for a period of two (2) years from the Closing
Date, to provide to Buyer, upon Buyer's written request, copies of
any documents or other information in Seller's possession, defining
or specifying the subject matter, nature and extent of the Know-How
and take such other action as the parties mutually agree is
reasonably necessary or appropriate to effectuate the transfer of
such Know-How.
B.Assignment of Intellectual Property Rights. On the Closing
Date, Seller shall execute and deliver assignments with respect to
the Intellectual Property Rights set forth on Schedule 1.A.3,
including all goodwill associated therewith.
C.Risk of Loss. The risk of loss and all obligations to insure
the tangible assets of the Business shall remain with Seller until
the Closing, and shall transfer from Seller to Buyer at the time of
Closing.
D."As Is" Condition. EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, THE PURCHASED ASSETS ARE BEING SOLD "AS IS" AND " WHERE
IS" AND "WITH ALL DEFECTS" WITHOUT ANY REPRESENTATION OR WARRANTY
WHATSOEVER, EXPRESS OR IMPLIED.
E.Assumption of Contractual Rights and Obligations Related Thereto.
At the time of Closing, the Buyer shall assume, and hereby agrees
to perform, the rights and obligations, and any other contractual
obligations pursuant to the Personal Property Leases, Real Property
Leases, the Contracts, bids, quotations, proposals and similar
agreements which (i) are disclosed in Schedules 2.A.1.a and 2.A.1.b
to this Agreement or (ii) were made in the ordinary course of
business and do not individually involve a commitment of more than
$50,000 (including without limitation any non- competition,
confidentiality, invention and similar agreements between Seller and
any employee of Seller) (collectively, the "Transferred Rights,
Obligations and Agreements").
To the extent that the assignment hereunder of any of the
Transferred Rights, Obligations, Agreements or the assignment under
Section 2.B above shall require the consent of any other party (or
in the event that any of the same shall be non-assignable), neither
this Agreement nor any actions taken hereunder shall constitute an
assignment or an agreement to assign if such assignment or attempted
assignment would constitute a breach thereof or result in the loss
or diminution thereof; provided, however, that in each such case,
the Seller and the Buyer shall use commercially reasonable efforts
to obtain the consent of such other party to an assignment to the
Buyer.
If such consent is not obtained, the Seller shall cooperate
with the Buyer in a reasonable arrangement designed to provide the
Buyer with the benefits and burdens of any such Transferred Rights,
Obligations and Agreements and under the Intellectual Property
Rights, including appointing the Buyer to act as its agent to
perform all of the Seller's obligations under such Transferred
Rights, Obligations and Agreements and to collect and promptly remit
to the Buyer all compensation received by Seller pursuant to those
Transferred Rights, Obligations and Agreements and to enforce, for
the account and benefit of the Buyer, any and all rights of the
Seller against any other person arising out of the breach or
cancellation of such Transferred Rights, Obligations and Agreements
by such other person or otherwise (any and all of which arrangements
shall constitute, as between the parties hereto, a deemed assignment
or transfer); provided that, to the extent that Seller is required
to undertake any services or take any actions in furtherance of the
performance of such Transferred Rights, Obligations and Agreements,
any such services or actions shall be the subject of a separate
agreement that the parties shall, in good faith, negotiate as
promptly as possible and which shall be mutually acceptable to the
parties.
F.Assumption of Certain Liabilities by Buyer. From and after the
Closing, Buyer shall, without any further responsibility or
liability of or recourse to Seller, or any of its affiliates
(including Fenwal Caribbean and Fenwal UK) or their respective
directors, shareholders, officers, employees, agents, consultants,
representatives, successors, transferees or assignees, assume and be
solely liable and responsible for the following liabilities and
obligations arising out of the ownership of the Purchased Assets or
the operation of the Business (the "Assumed Liabilities"):
1.all liabilities and obligations of Seller, Fenwal Caribbean or
Fenwal UK under all Personal Property Leases, Real Property Leases,
Contracts and all other of the Transferred Rights, Obligations
and Agreements assigned or transferred to Buyer pursuant to
Section 2.A hereof (or deemed assigned or transferred pursuant to
Section 2.E hereof) which arise or are to be performed following the
Closing Date;
2.subject to Section 6.D.7, all liabilities and obligations with
respect to the warranty policies and agreements of Seller, Fenwal
Caribbean or Fenwal UK described on Schedule 2.F.2 hereto;
3.all trade accounts payable of the Seller, Fenwal Caribbean or
Fenwal UK, to the extent set forth on the Closing Balance Sheet;
4.all current or long term liabilities or obligations of the Seller,
Fenwal Caribbean or Fenwal UK with respect to capitalized lease
obligations, equipment notes payable or other purchase money
financing, to the extent set forth on the Closing Balance Sheet; and
5.all other liabilities of Seller, Fenwal Caribbean or Fenwal UK
set forth on the Closing Balance Sheet.
The assumption by Buyer of the Assumed Liabilities and
the transfer thereof by Seller shall in no way expand the rights or
remedies of any third party against Seller or Buyer as compared to
the rights and remedies which such third party would otherwise have
had.
G.All Other Liabilities Excluded. Notwithstanding the foregoing,
Seller agrees that Buyer is not assuming any other liability of
Seller or any affiliate of Seller (including Fenwal Caribbean and
Fenwal UK) whether known, unknown, matured or contingent,
including, without limitation, the following liabilities and
obligations of Seller (collectively, the "Excluded Liabilities"):
1.any liability or obligation of the Seller to Shareholder or any of
its subsidiaries or affiliates;
2.any current or long-term liability or obligation of the Seller
with respect to indebtedness for borrowed monies from Congress
Financial Corporation;
3.any liability or obligation of the Seller for any Federal, state,
local or other taxes, including, without limitation, income, sales,
use, franchise, property, payroll or other taxes or for any
penalties or interest with respect to any of the foregoing, arising
or accruing before the Closing Date except to the extent properly
accrued on the Closing Balance Sheet;
4.any liability of the Seller for management or executive bonus
earned or accrued prior to the Closing Date;
5.except to the extent accrued on the Closing Balance Sheet, any
liabilities or obligations with respect to any pension, profit
sharing, health and welfare, medical insurance or other employee
benefit plan or fringe benefit arrangement ("Benefit Plans")
established, participated in, or maintained by Seller or any
affiliate of Seller for Seller's current or former employees,
including without limitation any "frozen" pension plan, whether or
not any such Benefit Plans relate to employees who may be employed
by Buyer following consummation of the transactions contemplated
hereby, provided, that in no event shall any Benefit Plan that Buyer
elects to continue constitute an Excluded Liability;
6.any fees, costs or expenses of Seller related to this Agreement or
the transactions contemplated hereby;
7.any and all liabilities (other than the warranty liability
expressly assumed under Section 2.F.2 hereof) relating to or arising
in connection with products sold by Seller or any affiliate of
Seller prior to the Closing Date;
8.any and all liabilities, whether or not known to Seller, to the
extent based on or arising out of any act or omission of Seller or
any affiliate of Seller, or any event or condition on the property
of Seller or any affiliate of Seller, occurring at any time on or
prior to the Closing Date and regardless of when notice of such is
received, relating to toxic or hazardous substances or waste
(including, without limitation, petroleum, petroleum products,
asbestos and PCB's) or other environmental pollution or
contamination, or to matters of environmental protection, pollution,
health, safety, sanitation or conservation; and
9.to the extent not constituting an Assumed Liability, any
liability or obligation arising out of or resulting from acts,
omissions, events, occurrences or transactions of whatsoever type or
nature to the extent arising out of or resulting from (i) the
ownership, use or possession of the Purchased Assets prior to the
Closing Date or (ii) the conduct of the Business prior to the
Closing Date.
3.Purchase Price; Payment; Adjustment.
A.Purchase Price.
1.Price. The purchase price for the sale and transfer of the
Purchased Assets shall be Twenty-Five Million Three Hundred Thousand
Dollars ($25,300,000), plus the assumption of the Assumed
Liabilities set forth in Section 2.F hereof, subject to adjustment
as provided in Section 3.C (the "Purchase Price").
2.Allocation.Not later than ninety (90) days after the Closing, the
Buyer shall provide to the Seller proposed statements prepared by
Ernst & Young (the "Allocation Statements") allocating in accordance
with generally accepted appraisal techniques, the total of the cash
portion of the Purchase Price and the book amount of the Assumed
Liabilities pursuant to this Agreement, to the different items of
Purchased Assets and to the Seller's obligations thereunder. Such
allocation shall be conclusive and binding on the parties unless the
Seller objects to such allocation within fifteen (15) days of its
receipt of such Allocation Statements. In the event Seller so
objects, the parties shall use good faith efforts to resolve any
such dispute, provided that in the event that the dispute cannot be
resolved, the parties shall engage a "Big 6" audit firm (other than
Ernst & Young) to determine the appropriate allocation. Any costs
or expenses incurred by the Buyer in connection with such Allocation
Statements (including appraisal fees) shall be borne by the Buyer.
Any costs or expenses incurred in connection with resolving any
dispute in connection with the allocation shall be borne equally by
the parties. The Buyer and the Seller respectively agree to file
all income, franchise and other tax returns, and execute such other
documents as may be required by any governmental authority, in a
manner consistent with the allocation as finally determined in
accordance with this Section 3.A.2 (the "Final Allocation"). The
Buyer shall prepare the Form 8594 under Section 1060 of the Code
relating to this transaction based on the Final Allocation and
deliver such Form to the Seller within 60 days after determination
of the Final Allocation as provided above. The Buyer and the Seller
respectively agree to file such Form with each relevant taxing
authority, and to refrain from taking any position inconsistent with
such Form or Final Allocation with any taxing authority unless
otherwise required by applicable law. The parties shall agree to
adjust consistent with this Section 3.A.2 a revised Final
Allocation, if necessary, based upon the final Purchase Price, as
adjusted in accordance herewith.
B.Payment of Purchase Price. At the Closing, Twenty-Five Million
Three Hundred Thousand Dollars ($25,300,000) of the Purchase Price
shall be paid by Buyer to Seller in immediately available funds.
C.Adjustment to and Payment of the Balance of the Purchase Price.
The Closing Date Payment has been derived by and agreed upon by the
parties based on the adjusted net book value of Seller's Balance
Sheet as of November 30, 1995, as shown on Exhibit A hereto (the
"Opening Balance Sheet"). The Purchase Price is subject to a
dollar for dollar adjustment, upward or downward, based upon the
change in the "Adjusted Book Value" of the Seller from that shown on
the Opening Balance Sheet ($4,479,000) to the "Final Book Value"
reflected on the "Closing Balance Sheet" (defined below). Such
adjustment shall be the "Differential." The Differential shall
be determined as follows:
1.Within forty-five (45) days after the Closing Date, Seller shall
prepare and deliver to Buyer a balance sheet (the "Closing Balance
Sheet") showing the book value of the Purchased Assets and Assumed
Liabilities of the Seller as of the Closing Date (the "Final Book
Value"). Buyer shall be entitled to observe the physical inventory
count performed by Seller in connection with the preparation of the
Closing Balance Sheet. The Closing Balance Sheet shall be prepared
in accordance with generally accepted accounting principles
consistently applied using the same accounting practices, policies
and procedures as was used in the preparation of the Opening Balance
Sheet ("GAAP"), subject to Section 3.C.3 below. Without limiting
the foregoing, the inventories reserve set forth on the Closing
Balance Sheet shall be determined in accordance with the methodology
as was used in the preparation of the Opening Balance Sheet. Along
with the submission of the Closing Balance Sheet, Seller shall
deliver a statement to Buyer which contains the amount of any
increase or decrease in the Purchase Price resulting from the
change in the book value of Seller described above (the
"Differential").
2.The Buyer shall then have forty-five (45) days after the receipt
thereof to contest in writing the Closing Balance Sheet by notice to
the Seller (with a statement as to the nature of the Buyer's
objections in reasonable detail and the proposed amount of the
Differential) and the corresponding impact on the Purchase Price.
If Buyer does not contest the Closing Balance Sheet by giving such
notice within that 45-day period, the Closing Balance Sheet prepared
by Seller shall be final and binding for purposes of this Agreement
and either a payment shall be made to Seller or a refund shall be
made to Buyer for the amount of the Differential, as the case may
be, by wire transfer of immediately available funds within five (5)
days after the expiration of that period. If the results are
contested, the parties shall agree upon the selection of a "Big 6"
audit firm to review the work and render a final and binding ruling
within sixty (60) days on such dispute. The cost of any such audit
shall be borne by the parties as follows: Seller shall pay an amount
equal to the product of such costs and a fraction, the numerator of
which is the difference between the Differential as proposed by
Seller and the Differential as determined by the audit firm and the
denominator of which is the difference between the Differential as
proposed by Seller and the Differential as proposed by Buyer in its
notice; Buyer shall pay the remainder of such costs. Any payment
due Seller or refund due Buyer shall be made within five (5) days
after such ruling.
3.For the purposes of preparing the Opening Balance Sheet and the
Closing Balance Sheet, the following accounts and all other Excluded
Assets and Excluded Liabilities have been and will be excluded
therefrom:
(i) cash, cash equivalents and investment securities
(subject to the
proviso below);
(ii) goodwill;
(iii) note receivable from W.E.C.C.
(iv) accrued management and executive bonus;
(v) income or franchise taxes; and
(vi) inter-company accounts;
provided, that notwithstanding the foregoing, cash and cash
equivalents held by Fenwal Caribbean and Fenwal UK shall be included
on the Closing Balance Sheet.
D.Closing Date.The closing of this transaction shall take place at
10:00 a.m. local time on March 29, 1996 or at an earlier date and
time to be mutually agreed upon between the parties or, if later,
the third business day following the expiration or termination of
the waiting period provided by the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 (herein the "Closing or "Closing Date" ),
at which time the transfer of title to and possession of the
Purchased Assets shall occur and the payment of the Purchase Price
as set forth in Section 3.B shall occur. At the Closing, each of
the parties hereto shall execute and deliver all
consideration, instruments and documents reasonably required to
carry out the terms and provisions of this Agreement. Possession of
all of the Purchased Assets shall be delivered to Buyer by Seller
immediately upon the Closing. The Closing shall take place in the
offices of the Seller, 1445 East Putnam Avenue, Old Greenwich,
Connecticut.
E.Waiver of Bulk Transfer Provisions. Buyer hereby waives
compliance with all provisions of the Bulk Sales Laws of
Massachusetts, if applicable to the transactions herein
contemplated, and in consideration of such waiver Seller agrees to
indemnify Buyer against and hold it harmless from any and all loss,
cost, damage, liability, deficiency or expense resulting from or
arising out of such noncompliance to the extent not involving an
Assumed Liability, provided that the provisions of Section 8 hereof
shall apply to this indemnity as if it were set forth therein,
except for the limitations established by Section 8.D, which shall
not apply.
4.Representations and Warranties of Seller and Shareholder. In
order to induce Buyer to enter into this Agreement and to consummate
the transactions contemplated hereunder, Seller and Shareholder,
jointly and severally, represent and warrant to Buyer, as follows:
A.Title to Assets. Seller, Fenwal Caribbean or Fenwal UK
has, and will have on the Closing Date, good and marketable title to
and legal right and power to convey all of the Purchased Assets
being transferred hereby, free and clear of any and all mortgages,
liens, pledges, security interests, privileges, charges, claims or
encumbrances of every kind, nature and description except as set
forth on Schedule 4.A attached hereto or reflected or disclosed in
the Closing Balance Sheet. Upon the consummation of the
transactions contemplated hereby, Buyer will acquire (i) good
title to the Purchased Assets owned by Seller, free and clear of any
security interest, lien or encumbrance and (ii) the right to use,
and valid leasehold interest in, any of the Purchased Assets not
owned by Seller, in each case subject to the liens, rights of others
and lease agreements reflected on Schedule 4.A and the matters
reflected or disclosed in the Closing Balance Sheet.
B.Organization and Qualification. Seller is a corporation
duly organized, validly existing and in good standing under the laws
of the State of Delaware with corporate power to own its properties
and to carry on its business as it is now being conducted and Seller
is duly qualified to transact business and is in good standing as a
foreign corporation in the Commonwealth of Massachusetts. Each of
Fenwal Caribbean and Fenwal UK is a corporation duly organized,
validly existing and in good standing under the laws of its
jurisdiction of incorporation (subject, in the case of Fenwal
Caribbean, to the filing of annual returns required by its
jurisdiction of incorporation), with corporate power to own its
properties and to carry on its business as it is now being
conducted.
C.Power and Authority. Each of Seller and Shareholder has the
corporate power to execute and deliver this Agreement and to incur
and perform its obligations hereunder. The execution, delivery and
performance of this Agreement and the transactions contemplated
hereby have been duly authorized by all necessary corporate action
on the part of Seller and Shareholder, and this Agreement is the
legal, valid and binding obligation of each of Seller and
Shareholder, enforceable in accordance with its terms.
D.Approvals and Consents; Noncontravention. The execution,
delivery, and performance of this Agreement by Seller and
Shareholder and the consummation of the transactions
contemplated hereby by Seller and Shareholder, will not (i) violate
any statute, regulation or ordinance of any governmental authority
or require any filing with or authorization, consent or approval of
any government or governmental agency, except as set forth on
Schedule 4.D, (ii) conflict with, result in the breach of, or
constitute a violation or default under any of the provisions of the
respective Articles of Incorporation or By Laws of Seller and
Shareholder, (iii) except as set forth on Schedule 2.A.1.a or
2.A.1.b, conflict with or result in a breach of any material
agreement, deed, contract, mortgage, indenture, writ, order,
decree, contractual obligation or instrument to which Seller or
Shareholder is a party or by which either of them or any of the
Purchased Assets are or may be bound, or constitute a default (or an
event which with the lapse of time or the giving of notice, or both,
would constitute a default) thereunder, or (iv) result in the
creation or imposition of any lien, charge or encumbrance, on or
with respect to the Purchased Assets.
E.Tax Returns; Withholdings. Each member of the Seller Group has
filed all federal tax returns and all state and any foreign or local
tax returns which are required to have been filed, and has paid all
taxes and governmental charges shown thereon as due. All amounts
required to be withheld by any member of the Seller Group from
employees for income tax, social security contributions,
unemployment tax and workers' compensation have been withheld and
paid to the appropriate governmental agencies.
F.Compliance with Laws. The Seller Group has complied in all
material respects with all applicable laws and regulations of
foreign, federal, state and local governments and all agencies
thereof that affect the Business or the Purchased Assets. Since
February 8, 1991, and, to Seller's knowledge, prior to such date,
no claims have been received in writing by any member of the Seller
Group from any governmental authority alleging a violation by any
member of the Seller Group of any such law or regulation. The
Seller Group holds all of the material permits, licenses,
certificates and other authorizations of foreign, federal, state
and local governmental agencies necessary to conduct the Business as
it is presently being conducted, including those permits, licenses,
certificates and other authorizations listed on Schedule 2.A.1.l.
All such permits, licenses and certificates are in full force and
effect, and no member of the Seller Group has since January 1, 1995
received any notice of intent to revoke or not to renew any of such
permits, licenses and certificates.
G.Litigation. There are no legal actions, suits,
arbitrations or other legal, administrative or other governmental
proceedings pending against any member of the Seller Group, the
Business or the Purchased Assets, and, to Seller's knowledge, there
are no legal actions, suits, arbitrations or other legal,
administrative or other governmental proceedings overtly threatened
in writing against any member of the Seller Group, the Business or
the Purchased Assets, in each case at law or in equity or by or
before any governmental department, commission, board, agency,
bureau, tribunal or instrumentality, except as shown on Schedule 4.G
attached hereto ("Litigation").
H.Financial Statements. Attached as Schedule 4.H are copies of the
unaudited financial statements of the Seller for the fiscal years
ended December 31, 1992 through 1995 ("Financial Statements"). The
Financial Statements (i) have been prepared from and are in
accordance with the Seller's books and records and (ii) fairly
present in all material respects the financial condition or results
of operations of Seller as of the relevant dates thereof and for
the periods covered thereby in accordance with GAAP (except for
the absence of footnotes). The Opening Balance Sheet, attached
hereto as Exhibit A, was prepared from the Financial
Statements in accordance with this Section 4.H to reflect the
elimination of (i) cash, cash equivalents and investment securities,
(ii) goodwill, (iii) note receivable from W.E.C.C., (iv) accrued
management and executive bonuses, (v) income and franchise taxes,
(vi) intercompany accounts and (vii) all other Excluded Assets and
Excluded Liabilities.
I.Absence of Undisclosed Liabilities. Except for the
obligations or liabilities (i) disclosed or referred to in the
Opening Balance Sheet, or (ii) incurred by the Seller Group with
respect to the Business in the ordinary course of business since the
date of the Opening Balance Sheet, there are no obligations or
liabilities arising out of or relating to transactions or events
with respect to the Business entered into or occurring prior to the
date hereof that would be required to be reserved against or
disclosed in a balance sheet of Seller prepared in a manner
consistent with the preparation of the Opening Balance Sheet.
J.Personnel.
1.Compensation Increases. Since November 30, 1995, there has not
been any increase in the base Compensation payable to or to become
payable to any employees of the Business, except (i) increases
granted in the ordinary course of business consistent with past
practice and (ii) as indicated on Schedule 4.J.1 hereto.
2.Compensation and Benefit Plans. Set forth on Schedule 4.J.2
hereto is a list and description of all compensation and benefit
plans, programs, agreements or arrangements generally applicable to
the employees of the Business which are currently in effect or
which, with respect to the Business, Seller has committed to
implement in the future (the "Compensation and Benefit Plans"). All
of the Compensation and Benefit Plans are in full force and effect
as written, all of such Plans were established and are in
substantial compliance with applicable law, including applicable
provisions of ERISA and the Code and Seller and Shareholder are in
compliance with the terms and provisions of such plans.
K.Contracts. All material contracts and leases ("Material
Agreements") affecting the Business are set forth on Schedule
2.A.1.a and Schedule 2.A.l.b. All of the Material Agreements are in
full force and effect, and no breach or default by any member of the
Seller Group or, to the best of Seller's knowledge, by any other
party has occurred with respect thereto. Except as identified
on Schedule 2.A.1.a and Schedule 2.A.1.b, no approval or consent of
any person is needed in order that the Material Agreements set forth
on Schedule 2.A.1.a and Schedule 2.A.1.b continue in full force and
effect following the assignment of such contracts to the Buyer
pursuant to this Agreement. As used herein, a "Material Agreement"
is one that (i) was not made in the ordinary course of business,
(ii) involves an aggregate commitment or potential aggregate
commitment on the part of any party of more than $50,000, (iii)
involves sale, distribution, commission, marketing, or similar
arrangements of the Seller Group relating to the Business providing
for the marketing and/or sale of the products or services of the
Business, (iv) involves any partnership, joint venture or other
similar contracts, arrangements or agreements relating to the
Business as a result of which Seller owns, directly or indirectly,
an equity interest (whether as a limited general partner, as a
shareholder or otherwise) in another entity, (v) involves the lease
of real property for the Business, or (vi) is with an employee,
officer or director of any member of the Seller Group who is not set
forth on Schedule 6.E.
L.Employment. Except as listed in Schedule 4.L hereto,
the Seller Group has complied in all material respects with all
applicable laws relating to the employment of labor, including
provisions thereof relating to wages, hours, equal opportunity and
collective bargaining, with respect to any employees of the
Business. In the last five (5) years, the Seller Group has
experienced no strikes or, to Seller's knowledge, any organized
slowdown, picketing or work stoppage. No member of the Seller Group
is a party to any collective bargaining or similar agreement with
any employee union.
M.Intellectual Property Rights. The Seller Group owns or has the
right to use all of the Intellectual Property Rights which are
necessary for the conduct of, or are used in, the Business as the
Business is presently being conducted and such rights and interests
are either (i) freely transferable to Buyer or (ii) shall be
licensed and made available for use by Buyer without cost. The
Seller Group has no knowledge and has received no notice to the
effect that any service or products that it provides or sells, or
any process, method, part or material it employs in the Business,
infringes on any trademark, trade name, copyright or patent or is in
conflict with any asserted right of another. There is no pending or,
to the knowledge of Seller, threatened, claim or litigation against
any member of the Seller Group contesting its right to use any of
the Intellectual Property Rights being transferred or licensed to
Buyer, or asserting its misuse of any thereof, which would deprive
Buyer of its right to assert its rights thereunder or which would
prevent the sale of any service or product produced, provided or
sold by Buyer utilizing the Intellectual Property Rights to be
transferred to Buyer.
N.Insurance Policies. Seller has delivered to Buyer a list of all
insurance policies or binders of insurance or programs of self-insurance
which relate to the Business or the Purchased Assets.
Since January 1, 1994, there has been no cancellation or nonrenewal
with respect to, or disallowance of any material claim under any
such policy.
O.Environmental Matters.
1. Definitions. As used in this Agreement:
a."Hazardous Materials" means (a) any and all hazardous substances,
pollutants, and contaminants (as defined by the Comprehensive
Environmental Response, Compensation and Liability Act of 1980,
as amended ("CERCLA")), hazardous wastes (as defined by the
Resource Conservation and Recovery Act ("RCRA")); hazardous
materials (as defined by the Hazardous Materials Transportation
Act); toxic substances (as defined by the Toxic Substances
Control Act ("TSCA")); toxic chemicals or extremely hazardous
substances (as defined by the Emergency Planning and Community
Right-To-Know Act); hazardous air pollutants (as defined by the
Clean Air Act); hazardous substances (as defined by the Clean Water
Act); (b) petroleum or petroleum products; polychlorinated
biphenyls ("PCBs"); asbestos-containing materials; and (c) any other
toxics, chemicals, wastes, substances. or materials which are
regulated under any of the Environmental Laws (as defined herein);
b."Environmental Laws" means all applicable federal, state,
local and foreign laws, rules, regulations, codes, ordinances,
orders, decrees, permits, licenses and judgments in effect as of the
date of this Agreement and relating to the environment and/or the
use, generation, storage, disposal, treatment, transportation,
recycling, sale or release of Hazardous Materials, including,
without limitation, CERCLA, RCRA, the Clean Water Act, the Clean Air
Act, TSCA, the Hazardous Materials Transportation Act and the
Emergency Planning and Community Right to Know Act;
c."Environmental Matters" means matters relating (i) to pollution,
contamination or protection of the environment, to release or
disposal of Hazardous Materials, to compliance with Environmental
Laws (including, without limitation, matters relating to any
"Environmental Costs" (as defined herein)) or to any releases or
threatened releases of Hazardous Materials into the air, surface
water, groundwater or soil, or (ii) resulting from the generation,
use, storage, treatment, recycling, transportation, disposal or
sale of Hazardous Materials); and
d."Environmental Costs" means any cleanup costs, remediation,
removal, or other response or site rehabilitation costs (including,
without limitation, costs to bring the Business into compliance with
all applicable Environmental Laws), investigation costs
(including, without limitation, the reasonable fees and costs of
consultants, legal counsel and other experts in connection with
any environmental investigation, testing, audits, assessments or
studies), losses, liabilities, obligations, payments, damages
(including, without limitation, any actual, punitive or
consequential damages (a) to third parties (including employees)
for personal injury or damage to property, or (b) to natural
resources, fines, penalties, judgments, and amounts paid in
settlement arising out of or resulting from any Environmental
Matter.
2.Environmental Representations and Warranties of Seller and
Shareholder. To the best of the knowledge of Seller and
Shareholder, after reasonable inquiry:
a.all permits, approvals, authorizations, licenses, certificates of
authorization, registrations or other consents required under all
applicable Environmental Laws for the operation of the Business and
the occupancy of the properties listed on Schedule l.A.2 hereto,
(the "Environmental Permits") have been obtained or applied for, and
there are no pending or threatened actions to modify, restrict,
rescind or challenge any Environmental Permit;
b.there are no material violations of any Environmental Permit at
any of the properties listed on Schedule 1.A.2 hereof;
c.Neither Seller nor any affiliate of Seller (including
Fenwal Caribbean and Fenwal UK) has received from any governmental
authority any notice in writing of the violation of any
Environmental Laws by any member of the Seller Group in connection
with the operation of the Business at any of the properties listed
on Schedule l.A.2 hereof or of any pending or threatened legal
action against Seller or any affiliate of Seller (including Fenwal
Caribbean and Fenwal UK) in connection with the operation of the
Business at any of the properties listed on Schedule l.A.2 hereof
under the authority of any Environmental Law or related to the
release of or exposure to any Hazardous Material;
d.except as disclosed in Schedule 4.O hereto, no amounts of
Hazardous Materials were disposed of by the Seller Group prior to
the Closing Date in, on, under, above or around the properties
listed on Schedule 1.A.2;
e.the processes, policies and activities of the Seller Group are in
substantial compliance with all applicable Environmental Laws and
regulations;
f.except as set forth on Schedule 4.O hereto, there are no
underground storage tanks on, at or below any of the real property
listed on Schedule 1.A.2 hereof.
P.Absence of Certain Changes. Except as set forth in
Schedule 4.P, since November 30, 1995, the Business has been
conducted in the ordinary course consistent with past practice, and
there has not been:
a.any event, occurrence, development or change in the Business that
has had a material adverse effect on the Business, other than those
resulting from changes, whether actual or prospective, in general
conditions applicable to the industries in which the Business is
involved or in general economic conditions;
b.any material damage, destruction or other casualty loss affecting
the Business;
c.any material change by the Seller or Shareholder in the manner the
Business keeps its books and records; or
d.any written notification by any customer of the Business expressly
stating its intent to discontinue doing business with the Business
or to substantially reduce its purchases of products of the
Business.
Q.Purchased Assets Complete. The Purchased Assets, together with
the Excluded Assets and the assets relating to the services provided
by Shareholder set forth on Schedule 4.Q constitute substantially
all of the assets used by the Seller in the conduct of the Business
as currently conducted by Seller.
5.Representations and Warranties of Buyer. In order to induce
Seller and Shareholder to enter into this Agreement and to
consummate the transactions contemplated hereunder, Buyer represents
and warrants to Seller and Shareholder as follows:
A.Organization and Qualification. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of
the State of Delaware with corporate power to own its properties and
to carry on its business as presently conducted.
B.Power and Authority. Buyer has the corporate power to execute
and deliver this Agreement and to incur and perform its obligations
hereunder. The execution and delivery of this Agreement and the
transactions contemplated hereby have been duly authorized by all
necessary corporate action on the part of Buyer, and this Agreement
is a legal, valid and binding obligation of Buyer enforceable in
accordance with terms.
C.Approvals and Consents; Noncontravention. The execution,
delivery, and performance of this Agreement by Buyer and the
consummation of the transactions contemplated hereby, will not (i)
violate any statute, regulation or ordinance of any
governmental authority or require any filing with or authorization,
consent or approval of any government or governmental agency, (ii)
conflict with, result in the breach of, or constitute a violation or
default under any of the provisions of the Articles of
Incorporation or By Laws of Buyer, (iii) conflict with or result in
a breach of any material agreement, deed, contract, mortgage,
indenture, writ, order, decree, contractual obligation or instrument
to which Buyer is a party or by which it or any of its assets are or
may be bound, or constitute a default (or an event which, with the
lapse of time or the giving of notice, or both, would constitute a
default) thereunder.
D.Financial Capacity to Close. At the time of Closing, as set
forth herein, Buyer shall have the financial ability to close
pursuant to the terms hereof. Buyer acknowledges that upon
execution hereof, the sale of the Business will be "taken off the
market." Buyer also acknowledges that there are no financing or
other contingencies herein.
6.Covenants.Publicity. Buyer, Seller and Shareholder shall
consult with each other before issuing any press release or other
public announcement concerning the transactions contemplated by this
Agreement and, except as may be required by applicable law or any
listing agreement with or regulation or rule of any listing
agreement with or regulation or rule of any stock exchange on which
securities of Seller, Buyer or Shareholder are listed or traded,
will not issue any such press release or announcement prior to
such consultation. If Buyer, Seller or Shareholder is so
required to issue such press release or announcement it shall use
its best efforts to inform the other party hereto prior to issuing
such press release.
B.Retention of and Access to Books and Records. For a period of
seven (7) years after the Closing Date, the parties shall retain
books or records relating to the Business, and any party, wishing
to dispose or destroy books or records, shall provide not less than
thirty (30) days prior written notice to the other party of such
proposed action. If the recipient of such notice desires to obtain
any of such documents, it may do so by notifying the other party in
writing at any time prior to the scheduled date for such destruction
or disposal. Such notice must specify the documents which the
requesting party wishes to obtain. The parties shall then promptly
arrange for the delivery of such documents. All out-of-pocket costs
associated with the delivery of the requested documents shall be
paid by the requesting party. Buyer shall, subject to such
reasonable limitations as may be necessary to protect proprietary
information, at the expense of Seller, and on reasonable prior
notice to Buyer, (a) afford Shareholder and Seller, and their
counsel, accountants, consultants and other representatives
reasonable access during normal business hours at the business
locations of the Purchased Assets to examine and copy the books, tax
returns, records and files of Seller which relate to periods prior
to the Closing Date, and (b) cooperate with reasonable
requests of Shareholder and Seller with respect to gathering
information contained therein which may be necessary to respond to
inquiries or requests made by any governmental authority or courts
which relate to any tax returns or other documents filed by or on
behalf of Shareholder and Seller prior to or relating to the periods
prior to the Closing Date. Seller shall, at Buyer's sole expense,
during normal business hours, afford Buyer and its agents reasonable
access to and the opportunity to review and make copies of, all
documents retained by Seller relating to the Business in connection
with any reasonable request of Buyer.
C.HSR Act. Within ten days after the date of this Agreement, Buyer
shall (or shall cause its ultimate parent entity to) and Shareholder
shall each file a notification of the acquisition contemplated
hereby with the Antitrust Division of the Department of Justice and
the Bureau of Competition of the Federal Trade Commission pursuant
to the Hart-Scott-Rodino Antitrust Improvements Act of 1976. Each
party filing such notification shall advise the other promptly upon
receiving any request for additional information or other
communication with respect to such filing from the Antitrust
Division of the Department of Justice or the Bureau of Competition
of the Federal Trade Commission and shall use its best efforts to
provide the information requested and otherwise respond to such
request or communication.
D.Covenants of Seller and Shareholder.
1.401(k) Plan.
a.As of the Closing Date, the Seller Group's obligation to make
contributions to (other than contributions attributable to the
period ending on the Closing Date but payable thereafter), and the
participation by employees of the Seller Group (the "Employees") in,
the Publicker Industries Inc. 401(k) Plan") shall cease, and as soon
as practicable thereafter, Seller shall pay to the trustee of the
Publicker 401(k) Plan all employee and employer contributions
attributable to the period ending on the Closing Date and cause such
amounts to be allocated to participant accounts, Seller shall cause
the trustee of the Publicker 401(k) Plan to segregate, in accordance
with the spin-off provisions set forth under Section 414 (1) of the
Code, the assets of the Publicker 401(k) Plan representing the full
account balances of Employees (including all employee contributions
and all vested and non-vested employer contributions made or due in
respect of the period ending on the Closing Date, and all earnings
attributable to such contributions) and notwithstanding anything in
this Agreement to the contrary, transfer, in cash such account
balances, which account balances shall have been credited with
appropriate earnings attributable to the period from the Closing
Date to the date of transfer described herein, reduced by any
benefit or withdrawal payments made to such Employees during the
period from the Closing Date to the date of transfer described
herein as to those Employees employed by Buyer, to a plan maintained
by Buyer (the "Buyer's 401(k) Plan") and a trust associated with
such plan (the "Buyer's 401(k) Trust"), provided Buyer's 401(k) Plan
is qualified under Sections 401(a) and 401(k) of the Code and
Buyer's 401(k) Trust is exempt from tax under Section 501(a) of the
Code.
b.Seller shall be under no obligation to transfer any assets form
the Publicker 401(k) Plan to the Buyer's 401(k) Plan or Buyer's
401(k) Trust after the Closing Date unless Buyer shall provide to
Seller either a favorable determination letter from the Internal
Revenue Service (the "IRS") or an opinion letter of counsel
reasonably satisfactory to Seller that the Buyer's 401(k) Plan and
Buyer's 401(k) Trust to which assets are to be transferred are
qualified under Section 401(a) of the Code and exempt from tax under
Section 501(a) of the Code.
2.Protection of Confidential Information. Each of Seller and
Shareholder hereby agree, for a period of five (5) years after the
Closing Date to safeguard against disclosure to third parties all
Trade Secrets transferred to Buyer hereunder, by using reasonable
secrecy measures and in any event not less than the same degree of
care as for its own similar proprietary information.
3.Solicitation of Employees. For a period of five (5) years after
the Closing Date, each of Seller and Shareholder shall not, without
Buyer's prior written consent, directly or indirectly solicit any
person known to Seller to be an employee of Buyer nor shall Seller
or Shareholder encourage any such employee to terminate his or her
employment with Buyer.
4.Intellectual Property. To the extent Seller fails to
transfer any Intellectual Property Rights or to make available any
which are currently used in the operation of the Business as it is
presently conducted, Seller shall take all commercially reasonable
actions required to effect or assist such transfer so as to confer
upon Buyer those benefits held by Seller which attend a use of
such Intellectual Property Rights in connection with the
Business.
5.Name. As of the Closing, Seller shall amend its articles
of incorporation to change its name to a name not similar to
"Fenwal Electronics, Inc."
6.Maintenance of Business Prior to Closing. From the date hereof
through the Closing, Seller shall continue to carry on the Business
in the ordinary course and in accordance with past practice.
7.Significant Product Failure. In the event that, with
respect to any product sold by Seller prior to the Closing Date,
Buyer incurs any loss, cost or expense arising out of a common
failure or potential common failure of such products in excess of
(i) the warranty reserve included in the Closing Balance Sheet, plus
(ii) $90,000, Seller shall reimburse Buyer for all such excess loss,
cost or expense.
E.Covenants of Buyer.
1.Employment. Except for those persons identified on
Schedule 6.E., Buyer shall employ all employees of the Seller Group
as of the Closing Date, except retired and former employees and
employees on permanent or long-term disability, at compensation
levels and on terms and conditions of employment (including
benefits) as are in the aggregate, substantially equivalent to
those in effect immediately prior to the Closing Date, provided,
however, that nothing contained in this Section 6.E.1 shall require
that Buyer continue to employ any employee after the Closing Date or
continue in effect any terms of employment thereof. Any obligations
under the Worker Adjustment and Retraining Notification Act ("WARN")
or for severance pay attributable to the failure of Buyer to employ
or continue to employ all such persons are hereby assumed by Buyer.
7.Taxes.
A.Pre-Closing Taxes. Seller shall be solely responsible for all
income and franchise taxes which are attributable to the operation
of the Business solely for periods ending on or prior to the
Closing Date, regardless of whether such taxes are due and payable
after the Closing Date.
B.Post-Closing Taxes. Buyer shall bear full responsibility for
all income and franchise taxes which are attributable to the
operation of the Business solely for periods after the Closing Date.
C.Transfer Taxes. All transfer, documentary, sales, and other
similar taxes incurred in connection with this Agreement and the
transactions contemplated hereby shall be borne equally by Buyer and
Seller.
8.Indemnification.The indemnification provided by this Section 8
shall be the exclusive remedy for any breach of, or failure to
perform, any representations, warranties, covenants or agreements
set forth in this Agreement or any Schedule or Exhibit hereto.
A.Seller's and Shareholder's Indemnity. Seller and Shareholder,
jointly and severally, shall indemnify, defend and hold Buyer
harmless from, against and in respect of any and all claims,
expenses, liabilities, damages, losses, costs, government
proceedings, causes of action, demands, judgments (including,
without limitation, reasonable attorneys' fees) (collectively,
the "Claims") to the extent suffered or incurred by Buyer by
reason of any of the following:
1.Seller's failure to pay, discharge or perform any of its
labilities or obligations other than the Assumed Liabilities, but
including, without limitation, the Excluded Liabilities;
2.without limiting Section 8.A.1, (i) any violations of any
Environmental Law by Seller, its agents, representatives, employees
or affiliates (including Fenwal Caribbean and Fenwal UK) on or prior
to the Closing Date, (ii) the presence on the property listed on
Schedule 1.A.2 of any Hazardous Materials including contamination of
ground water, surface water, air or soils on, over, under or around
such property or on, over, under or around adjacent property prior
to the Closing Date and the migration of Hazardous Materials from
such property to the extent present on the Closing Date, and (iii)
the transportation, storage or disposal of Hazardous Materials by or
for Seller on or prior to the Closing Date;
3. any breach by Seller or Shareholder of its representations or
warranties set forth in this Agreement or any Schedule or Exhibit
hereto; and
4.any breach by Seller or Shareholder of any of its covenants or
agreements set forth in this Agreement or any Schedule or Exhibit
hereto (other than such covenants and agreements set forth in this
Section 8).
B.Buyer's Indemnity. Buyer shall indemnify defend and hold Seller
and Shareholder harmless from, against and in respect of any and
all claims, expenses, liabilities, damages, losses, costs,
government proceedings, causes of action, demands, and judgements
(including, without limitation, reasonable attorney's fees)
(collectively, the "Claims") to the extent suffered or incurred by
Seller or Shareholder by reason of any of the following:
1.any claim or cause of action by any party with respect to any
obligation or liability relating to the Assumed Liabilities;
2.Buyer's operation of the Business and use of the Purchased Assets
after the Closing;
3.without limiting Sections 8.B.1 or 2, (i) any violations of any
Environmental Law by Buyer, its agents, representatives, employees
or affiliates (including Fenwal Caribbean and Fenwal UK) subsequent
to the Closing Date, (ii) any release or disposal on the property
listed on Schedule 1.A.2 of any Hazardous Materials including
contamination of ground water, surface water, air or soils on, over,
under or around such property or on, over, under or around adjacent
property subsequent to the Closing Date and the migration of
Hazardous Materials from such property to the extent released or
disposed of subsequent to the Closing Date, and (iii) the
transportation, storage or disposal of Hazardous Materials by or for
Buyer subsequent to the Closing Date;
4.any breach by Buyer of its representations or warranties set
forth in this Agreement or any Schedule or Exhibit hereto; and
5.any breach by Buyer of any of its covenants or agreements set
forth in this Agreement or any Schedule or Exhibit hereto (other
than such covenants and agreements set forth in this Section 8).
C.Indemnity Procedure. Subject to the time limitations and
amounts set forth in Section 8.D below, the Buyer, Seller and
Shareholder shall each follow the following procedures, as the case
may be:
1.If By Seller and Shareholder. Buyer shall promptly
notify Seller (for itself and on behalf of Shareholder) in writing
of the existence of any claim, demand or other matter ("Claim") to
which, in Buyer's reasonable judgment, Seller's or
Shareholder's, indemnification obligations hereunder would apply.
Seller and Shareholder shall thereafter have ten (10) business
days to determine whether, in their reasonable judgement,
they are obligated to indemnify Buyer with respect to such claim.
If Seller and Shareholder determine, within such ten (10)
business day period, that they are so obligated, they shall notify
Buyer of their determination thereof. Thereafter, Seller and
Shareholder shall assume the defense thereof, including retaining
counsel reasonably satisfactory to Buyer to represent Buyer, and
shall pay the fees and expenses of any such counsel related to such
proceeding as well as any fees or expenses incurred by Buyer to the
date of Seller's and Shareholder's assumption of the defense. In
any such proceeding, Buyer shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the
expense of Buyer.
All costs incurred by Buyer in the defense, settlement or compromise
of such Claim shall, to the extent Seller and Shareholder are
determined to be obligated to defend, indemnify and hold Buyer
harmless, be reimbursed to Buyer by Seller and Shareholder. If the
Claim is one that cannot by its nature be defended solely by
Seller and Shareholder (including, without limitation, any federal
or state tax proceeding), then Buyer shall make available
information and assistance (but not financial assistance) reasonably
required to defend the Claim.
2.If By Buyer. Seller shall promptly notify Buyer in writing of
the existence of any claim, demand or other matter ("Claim") to
which, in Seller's reasonable judgment, Buyer's indemnification
obligations hereunder would apply. Buyer shall thereafter have ten
(10) business days to determine whether, in its reasonable
judgement, it is obligated to indemnify Seller with respect to such
claim. If Buyer determines, within such ten (10) business day
period, that it is so obligated, it shall notify Seller of its
determination thereof. Thereafter, Buyer shall assume the
defense thereof, including retaining counsel reasonably
satisfactory to Seller to represent Seller, and shall pay the fees
and expenses of any such counsel related to such proceeding as well
as any fees or expenses incurred by Seller to the date of Buyer's
assumption of the defense. In any such proceeding, Seller shall
have the right to retain its own counsel, but fees and expenses of
such counsel shall be at the expense of Seller.
All costs incurred by Seller in the defense, settlement or
compromise of such claim shall, to the extent Buyer is determined to
be obligated to defend, indemnify and hold Seller harmless, be
reimbursed to Seller by Buyer. If the Claim is one that cannot by
its nature be defended solely by Buyer (including, without
limitation, any federal or state tax proceeding), then Seller shall
make available information and assistance (but not financial
assistance) reasonably required to defend the Claim.
D.Limitations of Indemnities.
1.Notwithstanding the provisions of Sections 8.A, 8.B and 8.C
hereof, no payment shall be made by an indemnifying party to an
indemnified party based upon any claim of an indemnified party under
Sections 8.A.3, 8.A.4, 8.B.4 or 8.B.5 (in the case of Sections 8.A.4
and 8.B.5, only to the extent the claim relates to a breach of any
covenant or agreement to be performed prior to the Closing) until
the amount of all such claims (after deducting insurance proceeds
and third party recoveries paid to or for the benefit of the
indemnified party) shall total, in the aggregate of (confidential
treatment requested) for any liabilities (excluding tax
liabilities which shall be fully reimbursed)(the "Minimum Damages"),
in which event only the amount of such claims of the indemnified
party in excess of the Minimum Damages (after deducting any
insurance proceeds and third party recoveries paid to or for
the benefit of the indemnified party) shall be subject to
indemnification in accordance with the terms of Sections 8.A, 8.B
and 8.C hereof. Notwithstanding the provisions of Sections 8.A, 8.B
and 8.C hereof, the maximum liability of the Shareholder and the
Seller (in the aggregate) or of the Buyer under this Section 8 with
respect to claims under Section 8.A.3, 8.A.4, 8.B.4 and 8.B.5 (in
the case of Sections 8.A.4 and 8.B.5, only to the extent the claim
relates to a breach of any covenant or agreement to be performed
prior to the Closing) shall be limited to (confidential treatment
requested).
2.The parties' respective obligations to indemnify each other under
Sections 8.A, 8.B and 8.C hereof shall expire on the (confidential
treatment requested) anniversary of the Closing Date, other than
claims pursuant to Sections 8.A.3 and 8.B.4, which shall expire on
the (confidential treatment requested) anniversary of the Closing
Date, it being understood that expiration of the obligation to
indemnify for Assumed Liabilities, in the case of the Buyer, and
Excluded Liabilities, in the case of the Seller, shall in no way
affect the agreement of the parties with respect to the retention or
allocation of liabilities as set forth in this Agreement.
E.Remedies. The indemnification provisions set forth in this
Section 8 shall be Seller's and Buyer's sole and exclusive remedy
against each other and Shareholder for any breach or
misrepresentation of any covenant or representation made herein,
provided that, Seller and Buyer shall retain all remedies at law or
in equity in the event of any fraud committed by the other party
hereto in connection with the terms of this Agreement.
9.Closing Conditions.
A.Conditions to Seller's Obligations. The obligations of
Seller to consummate the transactions provided for herein are
subject, in the discretion of Seller, to the satisfaction,
on or prior to the Closing Date, of each of the following
conditions; provided that Seller shall have the right to waive any
such condition, and the parties hereto agree that (i) the Closing of
this Agreement constitutes a waiver by Seller of any such condition
and of any claim or right relating to the subject matter of any such
condition; and (ii) if Seller has actual knowledge that any
representation or warranty of Buyer contained in this Agreement is
untrue or incorrect in any respect or that Buyer has failed to
perform any of its agreements or covenants required under this
Agreement to be performed by it prior to or at the Closing Date,
then notwithstanding anything to the contrary contained in this
Agreement, Seller shall not be entitled to make a claim for
indemnification under this Agreement with respect to any such
matter:
1.Representations, Warranties and Covenants. All representations
and warranties of Buyer contained in this Agreement shall be true
and correct in all material respects at and as of the Closing Date,
except as and to the extent that the facts and conditions upon which
such representations and warranties are based are expressly required
or permitted to be changed by the terms hereof, and Buyer shall have
performed all agreements and covenants required hereby to be
performed by it prior to or at the Closing Date.
2.Consents. All consents, approvals and waivers from governmental
authorities and other parties necessary to permit Buyer to purchase
the Purchased Assets from Seller as may be contemplated hereby shall
have been obtained.
3.No Governmental Proceedings or Litigation. No action, suit or
proceeding before any court or governmental body shall have been
instituted (and be pending) by any governmental authority to
restrain or prohibit this Agreement or the consummation of the
transactions contemplated hereby. No preliminary or permanent
injunction or other order issued by any federal or state court
of competent jurisdiction preventing consummation of the
transactions contemplated hereunder shall be in effect.
4.Certificates. Buyer will furnish Seller with such certificates
of its officers and others to evidence compliance with the
conditions set forth in this Article 9 as may be reasonably
requested by Seller.
5.Corporate Documents. Seller shall have received resolutions
adopted by the board of directors of Buyer approving this Agreement
and the transactions contemplated hereby, certified by Buyer's
corporate secretary.
B.Conditions to Buyer' Obligations. The obligations of Buyer to
consummate the transactions provided for hereby are subject, in
the discretion of Buyer, to the satisfaction, on or prior to
the Closing Date, of each of the following conditions; provided that
Buyer shall have the right to waive any such condition, and the
parties hereto agree that (i) the closing of this Agreement
constitutes a waiver by Buyer of any such condition and of any claim
or right relating to the subject matter of any such condition; and
(ii) if Buyer has actual knowledge that any representation or
warranty of Seller or Shareholder contained in this Agreement is
untrue or incorrect in any respect or that Seller or Shareholder has
failed to perform any of their agreements or covenants required
under this Agreement to be performed by them prior to or at the
Closing Date, then notwithstanding anything to the contrary
contained in this Agreement, Buyer shall not be entitled to make a
claim for indemnification under this Agreement with respect to any
such matter.
1.Representations, Warranties and Covenants. All representations
and warranties of Seller and Shareholder contained in this Agreement
shall be true and correct in all material respects at and as of the
Closing Date, except as and to the extent that the facts and
conditions upon which such representations and warranties are based
are expressly required or permitted to be changed by the terms
hereof, and Seller and Shareholder shall have performed all
agreements and covenants required hereby to be performed by them
prior to or at the Closing Date.
2.Consents. All consents, approvals and waivers from governmental
authorities and other parties necessary to permit Seller to transfer
the Purchased Assets to Buyer as contemplated hereby, and in the
aggregate sufficient and adequate to carry on the Business as
presently being conducted, shall have been obtained.
3.No Governmental Proceedings or Litigation. No action, suit or
proceeding before any court or governmental body shall have been
instituted (and be pending) by any governmental authority to
restrain or prohibit this Agreement or the consummation of the
transactions contemplated hereby. No preliminary or permanent
injunction or other order issued by any federal or state court
of competent jurisdiction preventing consummation of the
transactions contemplated hereunder shall be in effect.
4.Certificates. Seller will furnish Buyer with such certificates
of its officers and others to evidence compliance with the
conditions set forth in this Article 9 as may be reasonably
requested by Buyer.
5.Corporate Documents. Buyer shall have received from Seller and
Shareholder, resolutions adopted by the board of directors of Seller
approving this Agreement and the transactions contemplated hereby,
certified by Seller's and Shareholder's corporate secretary.
10.Closing Documents.
A.Provided by Buyer.
1.Funds. Wire transfer of the full amount of the Purchase Price
as set forth in Section 3.B;
2.Assumptions. Executed Bills of Sale and Assignments of
Contracts in the form attached hereto as Exhibit B and executed
assignments of lease agreements as specified in Schedule 2.A.1.a
hereto.
3.Secretary's Certificates. All resolutions of the Board of
Directors of Buyer authorizing the transactions contemplated by this
Agreement, certified by the Secretary of Buyer.
B.Provided By Seller.
1.Assignments and Bills of Sale. Executed Bills of Sale and
Assignments of Contracts in the form attached hereto as Exhibit B
and executed assignments of lease agreements as specified in
Schedule 2.A.1.a hereto.
2.Secretary's Certificates. All resolutions of the Board of
Directors of Seller and Shareholder and of the Shareholder as the
sole shareholder of Seller authorizing the transactions contemplated
by this Agreement, certified by the Secretary of Seller and
Shareholder.
11.Miscellaneous.
A.Termination. If the Closing has not occurred, each of Seller and
Buyer may terminate this agreement by notice to the other at any
time on or after April 15, 1996.
B.Successors and Assigns. Except as otherwise provided in
this Agreement, no party hereto shall assign this Agreement or any
rights or obligations hereunder (including by operation of law)
without the prior written consent of the other parties hereto and
any such attempted assignment without such prior written consent
shall be void and of no force and effect. This Agreement shall
inure to the benefit of and shall be binding upon the successors and
permitted assigns of the parties hereto. Prior to the Closing,
Buyer may designate certain affiliates of Buyer as the transferee of
certain of the Purchased Assets to be acquired hereunder, provided
that no such designation or transfer shall relieve Buyer of any of
its obligations hereunder.
C.Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New
York.
D.Expenses. Seller, Shareholder and Buyer will pay their
respective costs and expenses, including the expenses of their
accounting and legal representatives, in connection with the origin,
negotiation, execution and performance of this Agreement.
E.Force Majeure. No party hereto shall be liable for any failure
of or delay in the performance of this Agreement for the period that
such failure or delay is due to acts of God, public enemy, civil
war, strikes or labor disputes or any other cause beyond the
parties' reasonable control. Each party agrees to notify the other
party promptly upon the occurrence of any such cause and to carry
out this Agreement as promptly as practicable after such cause is
terminated.
F.Severability. If any part or provision of this Agreement shall
be determined to be invalid or unenforceable by a court of competent
jurisdiction or any other legally constituted body having
jurisdiction to make such determination, such part or provision
shall be valid and enforceable to the maximum extent permitted by
law and the remaining provisions of this Agreement shall be fully
effective.
G.Brokers' and Finders' Fees. Each of the parties represents
and warrants that it has dealt with no broker or finder in
connection with any of the transactions contemplated by this
Agreement and, insofar as it knows, no broker or other person is
entitled to any commission or finder's fee in connection with any of
these transactions.
H.Notices. All notices, requests, demands and other communications
under this Agreement shall be in writing and shall be deemed to have
been duly given (i) on the date of service if served personally on
the party to whom notice is to be given, (ii) on the day of
transmission if sent by facsimile transmission to the facsimile
number given below, and telephonic confirmation of receipt is
obtained promptly after completion of transmission, (iii) on the
day after delivery to Federal Express or similar overnight courier
or the Express Mail service maintained by the United States Postal
Service, or (iv) on the fifth (5th) day after mailing, if mailed to
the party to whom notice is to be given, by first class mail,
registered or certified, postage prepaid and properly
addressed, to the party as follows:
If to Seller or
Shareholder:Fenwal Electronics, Inc.
c/o Publicker Industries Inc.
1445 East Putnam Avenue
Old Greenwich, Connecticut 06870
Attn: Mr. James J. Weis
Telephone: (203) 637-4500
Facsimile: (203) 637-4807
Copy to:Kaye, Scholer, Fierman, Hays & Handler, LLP
425 Park Avenue
New York, NY 10022
Attention: Joel I. Greenberg, Esq.
Telephone: (212) 836-8201
Facsimile: (212) 836-7149
If to Buyer:BTR Control Systems Group
700 Narragansett Park Drive
Pawtucket, Rhode Island 02861
Telephone: (401) 727-1660
Facsimile: (401) 727-1090
Attention: Group Chief ExecutiveCopy to:BTR Inc.
Stamford Harbor Park
333 Ludlow Street
Stamford, Connecticut 06902
Telephone: (203) 352-0000
Facsimile: (203) 324-0503
Attention: Peter M. Kent, Esq.
Any party may change its address for the purpose of this Section
11.G by giving the other party notice of its new address in the
manner set forth above.
I.Amendments; Waivers. This Agreement may be amended, modified,
superseded or canceled, and any of the terms, covenants,
representations, warranties or conditions hereof may be waived, only
by written instrument executed by both parties hereto, or in the
case of a waiver, by the party waiving compliance. Any waiver by
any party of any condition, or of the breach of any provision, term,
covenant, representation or warranty contained in this Agreement, in
any one or more instances, shall not be deemed to be nor construed
as further or continuing waiver of any such condition, or of the
breach of any other provision, term, covenant, representation or
warranty of this Agreement.
J.Entire Agreement. This Agreement and the exhibits
referred to herein contain the entire agreement of the parties
hereto with respect to the sale and purchase of the Purchased
Assets and the other transactions contemplated herein, and any
reference herein to this Agreement shall be deemed to include the
schedules and exhibits attached hereto. All oral or written
agreements, statements, representations, warranties, and
understandings made or entered into by the parties prior to or
contemporaneously with the execution of this Agreement are hereby
rendered null and void and are merged herewith.
K.Further Matters. Each party agrees to execute such further
instruments of assignment and transfer and to perform such
additional acts and as are necessary to consummate the
transactions contemplated by this Agreement.
L.Parties in Interest. Nothing in this Agreement is intended to
confer, or confers, any rights or remedies under or by reason of
this Agreement on any persons other than the parties to it and their
respective successors and assigns. Nothing in this Agreement is
intended to, or does, relieve or discharge the obligations or
liability of any third persons to any party to this Agreement. No
provision of this Agreement shall give any third persons any right
of subrogation or action over or against any party to this
Agreement.
M.Survival. The representations, warranties and covenants of the
parties set forth herein shall survive the Closing date of this
Agreement for the periods set forth in Section 8.D hereof.
N.Section and Paragraph Headings. The section and paragraph
headings in this Agreement are for reference purposes only and shall
not affect the meaning or interpretation of this Agreement.
O.Counterparts. This Agreement may be executed in several
counterparts each of which shall be deemed an original but all of
which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above
written.
SELLER
Publicker Industries Inc.
By:
Title:
Fenwal Electronics, Inc.
By:
Title:
BUYER:
Elmwood Sensors, Inc.
By:
Title:
