SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_____________________________________
FORM 8-K/A
Amendment No. 1
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): 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 dis-
continued 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) - - (138)
Interest expense 2,181 (62) (2,119) -
Cost of pensions-
non operating 744 - - 744
Legal settlements
and costs 365 - - 365
Gain from repurchase
of notes (75) - 75 -
3,077 (62) (2,044) 971
Income (loss) from
continuing operations $ (834) $ (2,302) $ 2,123 $(1,013)
Earnings (loss) per common share from
continuing operations $ (0.06) $(0.07)
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 and (ii) the elimination of amortization
of debt discount and issuance costs and the gain on repurchase of notes
related to the 13% Subordinated Notes.
(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: May 14, 1996<PAGE>
PUBLICKER INDUSTRIES INC.
PUBLICKER INDUSTRIES INC.
EXHIBIT INDEX
Number Description
10.1 Asset Purchase Agreement among
Fenwal Electronics, Inc., Publicker
Industries Inc. and Elmwood Sensors,Inc.
dated March 29, 1996<PAGE>
EXHIBIT 10.1
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 two hundred fifty thousand dollars ($250,000) 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 the Purchase Price.
2.The parties' respective obligations to indemnify each other under Sections
8.A, 8.B and 8.C hereof shall expire on the tenth (10th) anniversary of the
Closing Date, other than claims pursuant to Sections 8.A.3 and 8.B.4, which
shall expire on the second 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:
