As filed with the Securities and Exchange Commission on August 23, 1995.
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
Registration Statement
Under
The Securities Act of 1933
NEWELL CO.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 36-3514169
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
Newell Center Dale L. Matschullat
29 East Stephenson Street 4000 Auburn Street
Freeport, Illinois 61032 Rockford, Illinois 61125
(815) 235-4171 (815) 969-6101
(Address, Including Zip Code, (Name, Address, Including Zip Code,
and Telephone Number, Including and Telephone Number, Including
Area Code, of Registrant's Area Code, of Agent for Service)
Principal Executive Offices)
With Copies to:
Linda J. Wight Rex E. Schlaybaugh, Jr.
Schiff Hardin & Waite Dykema Gossett PLLC
7200 Sears Tower 1577 N. Woodward Avenue, Suite 300
Chicago, Illinois 60606 Bloomfield Hills, Michigan 48304
(312) 876-1000 (810) 540-0700
---------------------
Approximate date of commencement of the proposed sale of the
securities to the public: From time to time after the effective date
of this Registration Statement.
If the securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. /__/
If any of the securities being registered on this form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, other than securities offered only in
connection with dividend or interest reinvestment plans, check the
following box. /X/
If the form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please
check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for
the same offering. /__/ __________<PAGE>
If the form is a post effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. /__/ __________
If delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box. /__/
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
Proposed Maximum Proposed Maximum Amount of
Title of Each Class of Amount To Be Aggregate Price Per Aggregate Offering Registration
Securities To Be Registered Registered Unit (1) Price (1) Fee
--------------------------- ------------ ------------------ ------------------ ------------
<S> <C> <C> <C> <C>
Common Stock,
Par Value $1.00 Per Share . . . 131,561 $25.63 $3,371,908.00 $1,163.00
Preferred Stock Purchase Rights
</TABLE>
(1) Estimated solely for the purpose of calculating the registration
fee pursuant to Rule 457(c) under the Securities Act of 1933
based on $25.63, the average of the high and low prices of the
Common Stock on August 18, 1995, as reported in the consolidated
reporting system. The value attributable to the Preferred Stock
Purchase Rights is reflected in the value attributable to the
Common Stock.
________________________
The Registrant hereby amends this Registration Statement on such
date or dates as may be necessary to delay its effective date until
the Registrant shall file a further amendment which specifically
states that this Registration Statement shall thereafter become
effective in accordance with Section 8(a) of the Securities Act of
1933 or until the Registration Statement shall become effective on
such date as the Commission, acting pursuant to said Section 8(a), may
determine.<PAGE>
PROSPECTUS
NEWELL CO.
UP TO 131,561 SHARES
COMMON STOCK, $1.00 PAR VALUE PER SHARE
(INCLUDING RELATED PREFERRED STOCK PURCHASE RIGHTS)
The shares of Common Stock, par value $1.00 per share (the
"Common Stock"), together with the Preferred Stock Purchase Rights
(the "Rights") offered to the public hereby (collectively, the
"Shares") are outstanding shares of Newell Co., a Delaware corporation
(the "Company"), that may be sold by the Selling Stockholder as set
forth under "Selling Stockholder." The Company will not receive any
part of the proceeds from the sale of the Shares. The Common Stock is
listed on the New York Stock Exchange, Inc. (the "NYSE") and the
Chicago Stock Exchange (the "CSE") under the symbol NWL. On August
18, 1995, the closing sale price for the Common Stock (as reported on
the Composite Tape for NYSE-listed issues) was $25-5/8.
-------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION NOR HAS THE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPEC-
TUS. ANY REPRESENTATION TO THE CON-
TRARY IS A CRIMINAL OFFENSE.
-------------------------------
The Company has been advised that sales of the Shares may be
made from time to time by or for the account of the Selling
Stockholder on the NYSE, in the over-the-counter market, in private
transactions or otherwise through broker-dealers. Any such sales will
be made either at market prices prevailing at the time of sale or at
negotiated prices. Any broker-dealer may either act as agent for the
Selling Stockholder or may purchase any of the Shares as principal and
thereafter may sell such Shares from time to time in transactions on
the NYSE, the CSE or in the over-the-counter market at prices
prevailing at the time of sale or at negotiated prices.
-------------------------------
The date of this Prospectus is August 23, 1995.
-1-<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and in accordance therewith files reports, proxy statements and other
information with the Securities and Exchange Commission (the "SEC").
Reports, proxy statements and other information filed by the Company
can be inspected and copied at prescribed rates at the public
reference facilities maintained by the SEC at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the SEC's Regional
Offices located at Seven World Trade Center, New York, New York,
10048; and the Northwestern Atrium Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661-2511. The Common Stock is listed
on the NYSE and the CSE and such reports, proxy statements and other
information concerning the Company can be inspected at the offices of
the NYSE, 20 Broad Street, New York, New York 10005 and at the offices
of the CSE, One Financial Place, 440 South LaSalle Street, Chicago,
Illinois 60605-1070.
The Company has filed with the SEC a registration statement
on Form S-3 (File No. 33-_____________) (herein, together with all
amendments and exhibits, referred to as the "Registration Statement")
under the Securities Act of 1933, as amended (the "Securities Act").
This Prospectus does not contain all of the information set forth in
the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the SEC. For further
information, reference is hereby made to the Registration Statement.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed by the Company pursuant to the
Exchange Act are hereby incorporated by reference:
(a) The Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1994;
(b) The Company's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1995;
(c) The Company's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1995;
(d) The description of the Rights contained in the
Company's Registration Statement on Form 8-A dated
October 25, 1988, including any amendment or
report filed for the purpose of updating such
description;
(e) The description of the Common Stock, contained in
the Company's Registration Statement on Form 8-B
dated June 30, 1987, including any amendment or
report filed for the purpose of updating such
description; and
-2-<PAGE>
(f) All documents subsequently filed by the Company
pursuant to Sections 13(a), 13(c), 14 and 15(d) of
the Exchange Act, prior to the filing of a post-
effective amendment which indicates that all
securities offered have been sold or which
deregisters all securities then remaining unsold.
Any statement contained herein or in a document incorporated
by reference or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to
the extent that such statement is modified or superseded by any other
subsequently filed document which is incorporated or is deemed to be
incorporated by reference herein. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
The Company will provide without charge to each person,
including any beneficial owner, to whom a copy of this Prospectus has
been delivered, upon the written or oral request of such person, a
copy of any or all of the documents which are incorporated herein by
reference, other than exhibits to such documents (unless such exhibits
are specifically incorporated by reference into such documents).
Requests for such copies should be directed to: Richard H. Wolff,
Secretary, Newell Co., 4000 Auburn Street, Rockford, Illinois 61125
(telephone: (815) 969-6111).
THE COMPANY
The Company is a manufacturer and full-service marketer of
high-volume consumer products serving the needs of volume purchasers.
The Company's basic strategy is to merchandise a multi-product
offering of brand-name staple products, with an emphasis on excellent
customer service, in order to achieve maximum results for its
stockholders. Product categories include housewares, hardware, home
furnishings, and office products. Each group of the Company's
products is manufactured and sold by a subsidiary or division (each
referred to herein as a "division," even if separately incorporated).
The Company manages the activities of its divisions through
executives at the corporate level, to whom the divisional managers
report, and controls financial activities through centralized
accounting, capital expenditure reporting, cash management, order
processing, billing, credit, accounts receivable and data processing
operations. The production and marketing functions of each division,
however, are conducted with substantial independence. Each division
is managed by employees who make day-to-day operating and sales
decisions and participate in an incentive compensation plan that ties
a significant part of their compensation to their division's
performance. The Company believes that this allocation of
responsibility and system of incentives fosters an entrepreneurial
approach to management that has been important to the Company's
success.
As of August 18, 1995, there were 158,291,128 shares of
Common Stock and related Rights outstanding. For the fiscal year
-3-<PAGE>
ended December 31, 1994, the Company had net sales of approximately
$2,074,934,000 and operating income of approximately $357,865,000.
The principal executive offices of the Company are located
at Newell Center, 29 East Stephenson Street, Freeport, Illinois
61032, and its telephone number is (815) 235-4171.
SELLING STOCKHOLDER
The Shares covered by this Prospectus are being offered by
or for the account of Thomas F. Gaffney (the "Selling Stockholder").
The Selling Stockholder was a stockholder of Ashland Products, Inc.
("Ashland"), which became a wholly-owned subsidiary of the Company on
June 5, 1995, pursuant to an Agreement and Plan of Reorganization (the
"Reorganization Agreement") dated as of June 5, 1995, by and among the
Company, Ashland Acquisition Co., a Delaware corporation, and Ashland.
Pursuant to the Reorganization Agreement, all of the outstanding
shares of common stock of Ashland owned by the Selling Stockholder
were converted into 131,561 Shares.
The Selling Stockholder currently owns 125,213 Shares.
Pursuant to the terms and conditions of an Escrow Agreement by and
between the Company, the Selling Stockholder, James J. Prete, Larry D.
Adkisson, and Firstar Trust Company (the "Escrow Agent"), the Selling
Stockholder has the right to receive up to an additional 6,348 Shares.
Such shares are held in escrow with the Escrow Agent for satisfaction
of the indemnification obligations of the Selling Stockholder under
the Reorganization Agreement. The escrow will terminate on the
earlier of June 9, 1996 or the final resolution of the last claim
permitted under the terms of the Escrow Agreement. At that time, any
Shares not used to satisfy the Selling Stockholder's indemnification
obligations and still held in escrow will be distributed to the
Selling Stockholder and may be sold pursuant to this Prospectus.
PLAN OF DISTRIBUTION
The Selling Stockholder has advised the Company that sales
of Shares may be made from time to time for its account on the NYSE,
the CSE, in the over-the-counter market, in private transactions or
otherwise through broker-dealers. Any such sales will be made either
at market prices prevailing at the time of sale or at negotiated
prices. Whether any such sales will be made, and the time of any such
sales, will rest within the Selling Stockholder's discretion.
The Selling Stockholder has not identified to the Company
any broker-dealer that may participate in the offer. Any such broker-
dealer either may act as agent for the Selling Stockholder or may
purchase any of the Shares as principal and thereafter may sell such
Shares from time to time in transactions on the NYSE, the CSE or in
the over-the-counter market at prices prevailing at the time of sale
or at negotiated prices. Any broker-dealer that may be used by the
Selling Stockholder might be deemed to be an "underwriter" as defined
in the Securities Act, and any commissions paid to such broker-dealer
(and, if such broker-dealer purchases Shares as a principal, any
profits received on the resale of such Shares) may be deemed to be
-4-<PAGE>
underwriting discounts or commissions under the Securities Act. In
addition, the Selling Stockholder may be deemed to be an underwriter
within the meaning of the Securities Act with respect to the Shares,
and any profits realized by such person may be deemed to be
underwriting commissions.
LEGAL OPINION
The legality of the Shares offered hereby has been passed
upon for the Company by Schiff Hardin & Waite, 7200 Sears Tower,
Chicago, Illinois 60606. Schiff Hardin & Waite has advised the
Company that a member of the firm participating in the representation
of the Company in this offering owns 3,746 Shares.
EXPERTS
The consolidated financial statements of the Company
incorporated herein have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their report with
respect thereto, and incorporated herein in reliance upon the
authority of said firm as experts in accounting and auditing in giving
said report.
-5-<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth all expenses in connection
with the distribution of the shares of Common Stock (and the Preferred
Stock Purchase Rights related thereto) being registered. All amounts
shown below are estimates, except the registration fee:
Registration fee of Securities and Exchange
Commission . . . . . . . . . . . . . . . . . . . $1,163.00
Stock Exchange Listing Fees . . . . . . . . . . . 2,158.00
Accountants' fees and expenses . . . . . . . . 5,000.00
Legal fees and expenses . . . . . . . . . . . . 10,000.00
Miscellaneous . . . . . . . . . . . . . . 1,679.00
----------
$20,000.00
TOTAL . . . . . . . . . . . . . . . . . . . ==========
Item 15. Indemnification of Directors and Officers
The Restated Certificate of Incorporation and By-Laws of the
registrant provide for indemnification by the registrant of each of
its directors and officers to the fullest extent permitted by law for
liability (including liability arising under the Securities Act of
1933 (the "Act")) of such director or officer arising by reason of his
or her status as a director or officer of the registrant, provided
that he or she met the standards established in the Restated
Certificate of Incorporation, which include requirements that he or
she acted in good faith and in a manner he or she reasonably believed
to be in the registrant's best interest. The registrant will also
advance expenses prior to final disposition of an action, suit or
proceeding upon receipt of an undertaking by the director or officer
to repay such amount if the director or officer is not entitled to
indemnification. All rights to indemnification and advancement of
expenses are deemed to be a contract between the registrant and its
directors and officers. The determination that a director or officer
has met the standards established in the Restated Certificate of
Incorporation and By-Laws may be made by majority vote of a quorum
consisting of disinterested directors, an opinion of counsel
(regardless of whether such quorum is available), a majority vote of
stockholders, or a court (which may also overturn any of the preceding
determinations). The registrant has purchased insurance against
liabilities of directors or officers, as permitted by the Restated
Certificate of Incorporation and By-Laws. The registrant also has
entered into indemnification agreements with each of its directors and
officers which provide that the directors and officers will be
entitled to their indemnification rights as they existed at the time
they entered into the agreement, regardless of subsequent changes in
the registrant's indemnification policy.
-6-<PAGE>
Item 16. Exhibits
The Exhibits filed herewith are set forth on the Index to
Exhibits filed as a part of this Registration Statement on page II-6
hereof.
Item 17. Undertakings
The undersigned registrant hereby undertakes:
1. To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement:
(a) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(b) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or the
most recent post-effective amendment thereof) which individually or in
the aggregate, represent a fundamental change in the information set
forth in the registration statement;
(c) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement.
provided, however, that paragraphs 1(a) and 1(b) do not apply if the
registration statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the
registrant pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 that are incorporated by reference in the registration
statement.
2. That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
3. To remove from registration by means of a post-
effective amendment any of the securities being registered which
remain unsold at the termination of the offering.
4. That, for purposes of determining any liability under
the Securities Act of 1933, each filing of the registrant's annual
report pursuant to Section 13(a) or 15(d) of the Exchange Act, that is
incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
-7-<PAGE>
Insofar as indemnification for liabilities arising under the
Act may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a
director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of
such issue.
-8-<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
Registrant certifies that it has reasonable grounds to believe that it
meets all the requirements for filing on Form S-3 and has duly caused
this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Rockford, State
of Illinois, on this 23rd day of August, 1995.
NEWELL CO.
(Registrant)
By: /s/ William T. Alldredge
-------------------------------
William T. Alldredge
Vice President - Finance
Each person whose signature appears below appoints William
P. Sovey and William T. Alldredge or either of them, as such person's
true and lawful attorneys to execute in the name of each such person,
and to file, any amendments to this registration statement that either
of such attorneys shall deem necessary or advisable to enable the
Registrant to comply with the Securities Act of 1933, as amended, and
any rules, regulations and requirements of the Securities and Exchange
Commission with respect thereto, in connection with the registration
of shares of Common Stock of the Registrant that are subject to this
registration statement (and the Preferred Stock Purchase Rights
attached thereto), which amendments may make such changes in such
registration statement as either of the above-named attorneys deems
appropriate, and to comply with the undertakings of the Registrant
made in connection with this registration statement; and each of the
undersigned hereby ratifies all that either of said attorneys shall do
or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933,
this registration statement has been signed by the following persons
in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ William P. Sovey Vice Chairman and Chief August 23, 1995
-------------------------------- Executive Officer (Principal
William P. Sovey Executive Officer) and Director
/s/ William T. Alldredge Vice President - Finance August 23, 1995
-------------------------------- (Principal Financial Officer)
William T. Alldredge
-9-<PAGE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Thomas A. Ferguson, Jr. President and Chief August 23, 1995
------------------------------------ Operating Officer and Director
Thomas A. Ferguson, Jr.
/s/ Donald L. Krause Senior Vice President - Controller August 23, 1995
------------------------------------ (Principal Accounting Officer)
Donald L. Krause
/s/ Daniel C. Ferguson Chairman of the Board of Directors August 23, 1995
------------------------------------
Daniel C. Ferguson
/s/ Alton F. Doody Director August 23, 1995
------------------------------------
Alton F. Doody
/s/ Gary H. Driggs Director August 23, 1995
------------------------------------
Gary H. Driggs
/s/ Robert L. Katz Director August 23, 1995
------------------------------------
Robert L. Katz
/s/ John J. McDonough Director August 23, 1995
------------------------------------
John J. McDonough
/s/ Elizabeth Cuthbert Millett Director August 23, 1995
------------------------------------
Elizabeth Cuthbert Millett
/s/ Allan P. Newell Director August 23, 1995
------------------------------------
Allan P. Newell
/s/ Henry B. Pearsall Director August 23, 1995
------------------------------------
Henry B. Pearsall
</TABLE>
-10-<PAGE>
INDEX TO EXHIBITS
Exhibit
Index Exhibit
--------- -------
2.1 Agreement and Plan of Reorganization dated as of June
5, 1995 by and among Newell Co., Ashland Acquisition
Co., and Ashland Products, Inc.
2.2 Escrow Agreement dated as of June 9, 1995 by and among
Newell Co., Thomas F. Gaffney, James J. Prete, Larry D.
Adkisson and Firstar Trust Company
5 Opinion of Schiff Hardin & Waite
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Schiff Hardin & Waite (contained in their
opinion filed as Exhibit 5)
24 Powers of attorney (set forth on the signature page of
this registration statement)
EXHIBIT 2.1
AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization (the "Agreement") is
made and entered into as of June 5, 1995, by and among NEWELL CO., a
Delaware corporation ("Newell"), ASHLAND ACQUISITION CO., a Delaware
corporation ("Acquisition"), and ASHLAND PRODUCTS, INC., a Delaware
corporation (the "Company").
WITNESSETH:
WHEREAS, Newell owns all of the outstanding capital stock of
Acquisition; and
WHEREAS, Thomas F. Gaffney ("Gaffney"), James J. Prete ("Prete"),
Larry D. Adkisson ("Adkisson") and GENERAL ELECTRIC CAPITAL
CORPORATION, a New York corporation ("GECC"), (collectively, the
"Shareholders") own in the aggregate, 100% of the outstanding shares
of capital stock of the Company, and have a right to acquire by
options and a warrant issued by the Company, additional shares of
capital stock, in the amounts described in Section 2.03 of this
Agreement;
WHEREAS, the respective Boards of Directors of Newell,
Acquisition and the Company have approved the transactions provided
for by this Agreement, pursuant to which the Company is to be merged
into Acquisition in accordance with the applicable provisions of the
Delaware Corporation Law, which merger is intended to qualify as a
reorganization under Section 368 of the Internal Revenue Code of 1986,
as amended (the "Code"); and
WHEREAS, Newell has agreed (i) to provide the shares required to
convert, at the Effective Time (as hereinafter defined) of the merger,
each of the outstanding shares of Common (as defined in Section
2.03(a) of this Agreement) and Special (as defined in Section 2.03(a)
of this Agreement) owned by Gaffney (collectively, the "Gaffney
Stock") into shares of Common Stock, $1.00 par value, of Newell
("Newell Common Stock"), and (ii) to provide the cash required to
purchase, at the Effective Time of the merger, each of the options for
Common and Special owned by Prete and Adkisson (respectively, the
"Prete Option" and the "Adkisson Option"), the warrant for Common
owned by GECC (the "GECC Warrant"), and the Preferred (as defined in
Section 2.03(a) of this Agreement) owned by GECC (the "GECC Stock"),
subject to the provisions of this Agreement and the Agreement and Plan
of Merger (the "Plan of Merger") attached hereto as Exhibit A, all
upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in order to consummate the transactions set forth
above and in consideration of the mutual covenants, agreements,
representations and warranties herein contained, the parties agree as
follows:
-12-<PAGE>
ARTICLE I
THE MERGER
1.01 THE MERGER. Subject to the terms and conditions of this
Agreement and the Plan of Merger, the Company shall be merged with and
into Acquisition in accordance with the Delaware Corporation Law (the
"Merger"), the separate corporate existence of the Company shall
cease, and Acquisition shall be the surviving corporation.
The Plan of Merger sets forth the terms of the Merger, the mode
of carrying the same into effect, the manner of converting the Gaffney
Stock into shares of Newell Common Stock and the manner of purchasing
for cash the GECC Stock and the Prete Option and Adkisson Option.
Newell, Acquisition and GECC have entered into that certain Warrant
Purchase Agreement, dated as of June 9, 1995 (the "Warrant Purchase
Agreement"), providing for the purchase of the GECC Warrant.
Immediately prior to the Merger, the GECC Warrant will be
purchased by Acquisition for a cash purchase price of Three Million
Four Hundred Sixty Eight Thousand Dollars ($3,468,000). In the
Merger, the Preferred held by GECC will be converted into Five Million
Dollars ($5,000,000) in cash, the Special held by Gaffney will be
converted into 65,150 shares of Newell Common Stock and the Common
held by Gaffney will be converted into 66,411 shares of Newell Common
Stock. In the Merger, the options held by Prete for Common will be
converted into Nine Hundred Twenty Seven Thousand Five Hundred Twenty
Dollars ($927,520) in cash, the options held by Prete for Special will
be converted into Eight Hundred Twenty Five Thousand Dollars
($825,000) in cash, the options held by Adkisson for Common will be
converted into Seven Hundred Ninety Nine Thousand Dollars ($799,000)
in cash and the options held by Adkisson for Special will be converted
into Six Hundred Thousand Dollars ($600,000) in cash.
The Merger shall be consummated after the closing provided in
Section 1.02 hereof when properly executed Articles of Merger are
filed with the Secretary of State of Delaware in accordance with the
Delaware Corporation Law and when the Plan of Merger is received by
the Delaware Secretary of State and filed by the Secretary of State in
the State of Delaware (the "Effective Time").
1.02 CLOSING. The closing of the transactions contemplated by
this Agreement (the "Closing") and the Plan of Merger shall take place
at the offices of Dykema Gossett, 1577 N. Woodward Avenue, Suite 300,
Bloomfield Hills, Michigan 48304, on June 9, 1995, or at such other
time and place as Newell and the Company shall agree.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Newell and Acquisition
that:
2.01 ORGANIZATION AND AUTHORITY. The Company is duly organized,
validly existing and in good standing under the laws of Delaware with
all requisite power and authority to own, lease and operate its
-13-<PAGE>
properties and to carry on its business as now being conducted and,
except for the State of Indiana, is not qualified in any other
jurisdiction. Copies of the Certificate of Incorporation and Bylaws
of the Company that have been heretofore delivered to Newell are
complete and correct as of the date hereof.
2.02 SUBSIDIARIES AND AFFILIATES. There are no corporations,
partnerships or other entities in which the Company has an equity
interest.
2.03 CAPITALIZATION OF THE COMPANY.
(a) AUTHORIZED CAPITAL. The authorized capital stock of the
Company consists of 10,000 shares of Common Stock, $.01 par value
("Common"), 1,000 shares of Special Stock, $.01 par value ("Special"),
and 5,000 shares of Preferred Stock, Series A, redeemable,
noncumulative through September 30, 1995 ($105) cumulative dividend
thereafter, $.01 par value ("Preferred").
(b) ISSUED AND OUTSTANDING CAPITAL STOCK. 150 shares of Common
are issued and outstanding and owned by Gaffney. 400 shares of
Special are issued and outstanding and owned by Gaffney. 5,000 shares
of Preferred are issued and outstanding and owned by GE.
(c) OPTIONS, WARRANTS AND REDEMPTION AGREEMENTS. By its terms,
the GE Warrant is exercisable at any time for a number of shares of
Common equal to 51% of (i) the number of shares of Common issued and
outstanding plus (ii) the number of shares of Common subject to
currently exercisable options and warrants. At the Closing, the GE
Warrant will be exercisable for 324.015247752 shares of Common. 79
shares of Common are subject to issuance to Prete pursuant to that
certain Nonqualified Common Stock Option Agreement dated June 29,
1993. An additional 7.65819567 shares of Common are subject to
issuance to Prete pursuant to that certain Nonqualified Common Stock
Option Agreement dated as of February 25, 1995. 79 shares of Common
are subject to issuance to Adkisson pursuant to that certain
Nonqualified Common Stock Option Agreement dated August 30, 1993.
4.34942322 shares of these 79 shares of Common are subject to
redemption pursuant to that certain Common Stock Redemption Agreement
dated as of February 25, 1995. 18.1818183 shares of the 400 shares of
Special held by Gaffney are subject to redemption pursuant to that
certain Special Stock Redemption Agreement dated as of February 25,
1995, by and between the Company and Gaffney. 200 shares of Special
are subject to issuance to Prete pursuant to that certain Nonqualified
Special Stock Option Agreement dated as of June 30, 1993. 200 shares
of Special are subject to issuance to Adkisson pursuant to that
certain Nonqualified Special Stock Option Agreement dated as of August
30, 1993. 54.5454546 shares of these 200 shares of Special issuable
to Adkisson are subject to redemption pursuant to that certain Special
Stock Redemption Agreement dated as of February 25, 1995.
(d) CAPITAL STRUCTURE AS OF THE CLOSING. Assuming that all
options, warrants and rights to redeem are fully exercised as of the
Closing, the capital stock of the Company as of the Closing will be as
set forth below.
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GAFFNEY GECC PRETE ADKISSON
------- ---- ----- --------
150 Shares 324.01524775 86.65819567 74.65057178
Common Shares Common Shares Common Shares Common
(23.61%) (51%) (13.64%) (11.75%)
381.8181817 0 Shares 200 Shares 145.4545454
Shares Special Special Special Shares Special
(52.50%) (27.50%) (20%)
0 Shares 5,000 Shares 0 Shares 0 Shares
Preferred Preferred Preferred Preferred
(100%)
(e) GENERAL. All shares of Gaffney Stock and GE Stock have been
issued pursuant to and in accordance with valid exemptions from
registration under the Securities Act of 1933, as amended, and
applicable state securities laws, and rules and regulations under such
laws. There are no pre-emptive rights to acquire any capital stock of
the Company. Other than as described in this Section 2.03, there are
no other shares of capital stock or other equity securities (or debt
securities with any voting rights or convertible into securities with
any voting rights) of the Company outstanding and no other outstanding
options, warrants, scrip, rights to subscribe to, calls or commitments
of any character whatsoever relating to, or securities or rights
convertible into, shares of capital stock of the Company.
2.04 AUTHORIZATION. The Company has full power and authority to
enter into this Agreement and the Plan of Merger and to carry out its
obligations hereunder and thereunder. The execution and delivery of
this Agreement and the Plan of Merger and the consummation of the
transactions contemplated hereby and thereby have been duly authorized
by the Company's Board of Directors and shareholders, and no other
corporate proceedings on the part of the Company are necessary to
authorize this Agreement, the Plan of Merger and the transactions
contemplated hereby and thereby. This Agreement and the Plan of
Merger have been duly executed and delivered by the Company. This
Agreement is, and subject to approval by the Shareholders of the
Company, the Plan of Merger will be, legal, valid and binding
obligations of the Company enforceable against the Company in
accordance with their respective terms. This Agreement has been duly
executed and delivered by the Company and is the legal, valid and
binding obligation of the Company enforceable against the Company in
accordance with its terms, except as enforcement may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of
creditors rights generally and by principles of equity. Except as set
forth on Schedule 2.04, neither the execution and delivery of this
Agreement nor the Plan of Merger by the Company, nor the consummation
of the transactions contemplated hereby and thereby, nor compliance
with the Company with any of the provisions hereof or thereof will (i)
violate, conflict with or result in a breach of any provisions of, or
constitute a default (or an event which, with notice or lapse of time
or both, would constitute a default) under, or result in the
termination of, or accelerate the performance required by, or result
in a right of termination or acceleration, or result in the creation
-15-<PAGE>
of any lien, security interest, charge or encumbrance upon any of the
material properties or assets of the Company, under any of the terms,
conditions or provisions of (x) its charter or Bylaws, or (y) any
note, bond, mortgage, indenture, deed of trust, license, lease,
agreement or other instrument or obligation to which the Company is a
party, or by which any property or assets of the Company may be
subject, other than any violation, conflict, default, breach,
termination or acceleration which would not have a serious detrimental
effect on the ability of the Company to consummate this Agreement or
on the ongoing business or future prospects of the Company (a
"Material Adverse Effect"), or (ii) violate any judgment, ruling,
order, writ, injunction, decree, statute, rule or regulation
application to the Company or any of its properties or assets. No
notice or report to, filing with, or authorization, consent or
approval of, any public body or authority is necessary for the
execution, delivery and performance by the Company of this Agreement
or the Plan of Merger.
2.05 FINANCIAL STATEMENTS. The (i) audited balance sheets as of
December 31, 1994, and the unaudited balance sheets as of April 30,
1995 (the unaudited balance sheet as of April 30, 1995, being referred
to herein as the "Company Balance Sheet"), and (ii) the audited
statements of income, stockholders equity and cash flow for the fiscal
years ended December 31, 1993 and 1994, and unaudited statements for
the period ending April 30, 1995 that have heretofore been delivered
to newell fairly present the financial condition and results of
operations of the Company as at the respective dates and all such
financial statements have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the
periods involved except that the interim financial statements do not
include full financial footnotes and are subject to customary year-end
and audit adjustments.
2.06 INVENTORY. All inventory reflected on the Company Balance
Sheet or thereafter acquired was acquired or manufactured in the
ordinary course of business, and is usable or saleable in the ordinary
course of business except for inventory items which are obsolete or
not usable or saleable in the ordinary course of business which have
been written down or for which adequate reserves or allowances have
been provided as shown in the Company Balance Sheet.
2.07 RECEIVABLES. All of the accounts reflected in the Company
Balance Sheet have arisen from bonafide transactions by the Company in
the ordinary course of business and no portion of any such account
receivable is currently subject to counterclaim or set off or is in
dispute, except in the ordinary course of business. The accounts
receivable are good and collectible in the ordinary course of business
at the net aggregate recorded amounts thereof after giving effect to
the reserves as set forth in the Company Balance Sheet. All payments
received by Acquisition with respect to any customers or third parties
where the debt or other obligation is reflected in the Company's
accounts receivable on the Closing Date (the "Accounts") shall be
applied to such Account until such Account is paid in full.
-16-<PAGE>
2.08 ABSENCE OF CERTAIN CHANGES.
(a) Except as set forth on Schedule 2.08, since May 1, 1995, the
Company has conducted its business only in the ordinary and usual
course and has not experienced any changes in its condition (financial
or otherwise), assets, liabilities, business or operations which
individually or in the aggregate had a Material Adverse Effect.
Without limiting the generality of the foregoing sentence, since May
1, 1995, the Company has not:
(i) paid, discharged or satisfied any liability or
obligation (whether accrued, absolute, contingent or otherwise)
in excess of $10,000 other than the payment, discharge or
satisfaction in the ordinary and usual course of business, of
liabilities or obligations shown or reflected on the Company
Balance Sheet or incurred any liability or obligation in excess
of $10,000 except in the ordinary course of business since the
date of the Company Balance Sheet;
(ii) except for mortgages, pledges, liens, security
interests, encumbrances, restrictions or charges in existence on
April 30, 1995, or in the ordinary and usual course of business,
permitted or allowed any assets (whether real, personal or mixed,
tangible or intangible) to be subjected to any mortgage, pledge,
lien, security interest, encumbrance, restriction or charge of
any kind, or sold, transferred or otherwise disposed of any of
its notes or accounts receivable;
(iii) written off as uncollectible any notes or accounts
receivable or written down the value of any inventory other than
in the ordinary and usual course of business;
(iv) cancelled or waived any claims or rights or sold,
transferred, distributed or otherwise disposed of any assets,
except assets in the ordinary and usual course of business;
(v) disposed of or permitted to lapse any rights in, to or
for the use of any patent, trademark, trade name or copyright;
(vi) granted any increase in the base compensation or other
payment to any director, officer or employee, whether now or
hereafter payable or granted (other than increases in
compensation in the ordinary course consistent in timing and
amount with past practice) or granted any severance or
termination pay (other than for severance pay in amounts
consistent with the Company's established severance pay
practices), or entered into or varied the terms of any employment
agreement with any such person;
(vii) made any capital expenditure or commitment in
excess of the capital budget attached to and made a part of
Schedule 2.08 for additions to property, plant or equipment, or
leased or agreed to lease any assets which, if purchased, would
be reflected in the property, plan or equipment accounts;
-17-<PAGE>
(viii) made any material change in any method of
accounting or keeping its books of account or accounting
practices;
(ix) paid any amounts which individually exceeded $10,000
to, or sold or otherwise disposed of any assets valued
individually in excess of $10,000 to, acquired any assets from,
or entered into any agreement or arrangement with, any Affiliated
Person (other than payments of compensation to employees for
wages in the ordinary course). For purposes of this Agreement,
"Affiliated Person" means any present director, officer,
shareholder or employee of the Company and any member of such
person's family and any entity in which such person or any member
of such person's family has an interest or which is controlled,
directly or indirectly, by such person or any member of such
person's family;
(x) incurred any obligation or liability, including,
without limitation, any liability for nonperformance or
termination of any contract, except liabilities incurred in the
ordinary and usual course of the business, none of which will
adversely effect or has adversely affected the business or the
Company's financial condition;
(xi) authorized for issuance, issued, delivered or sold any
debt or equity securities, or altered the terms of any
outstanding securities issued by it or in any way increased its
indebtedness for borrowed money; or
(xii) declared, paid or set aside for payment any
dividend or other distribution (whether in cash, stock or
property or otherwise) in respect of Gaffney Stock or GECC Stock,
or redeemed, purchased or otherwise acquired any Company Common,
Special or Preferred, any securities convertible into or
exchangeable for any Company Common, Special or Preferred or any
options, warrants or other rights to purchase or subscribe to any
of the foregoing (and no dividends are or will be owed on Gaffney
Stock or GECC Stock).
2.09 LITIGATION AND OTHER PROCEEDINGS. Except as set forth on
Schedule 2.09, neither the Company nor any Shareholder is currently a
party to any pending or to the knowledge of the Company, threatened
claim, action, suit, investigation or proceeding, or subject to any
order, judgment or decree relating to or affecting the Company or,
with respect to the Shareholders, relating to or affecting their
shares of Company Common, Special or Preferred or their positions with
the Company.
2.10 COMPLIANCE WITH LAWS. Except as described in Schedule 2.10,
the Company is not in violation of any statute or other rule or
regulation of any governmental body, the violation of which is likely
to have a material adverse effect upon the business, operations,
properties, financial conditions or earnings of the Company. Schedule
2.10 lists all licenses, registrations and permits, and applications,
with respect to the business and operations of the Company. The
Company currently has all material governmental approvals, consents,
-18-<PAGE>
licenses, registrations and permits necessary to carry on its business
as presently conducted. The Company has not received notice of
violation of any laws or notice of any proposed regulations or changes
in the requirement of such approvals, consents, licenses,
registrations or permits.
2.11 TAX RETURNS AND AUDITS. The Company has filed with the
appropriate governmental agencies all tax returns required to be filed
by it and has paid, or made provision for the payment of, all taxes of
every type and description which have or may become due, and such
returns accurately reflect the Company's obligations to pay taxes for
the periods covered therein under the applicable tax laws. The
accruals and reserves for taxes reflected in the Company's Balance
Sheet are adequate to pay in full all taxes that have accrued for any
period which are not yet due and payable. No examination relating to
any tax returns is currently in progress of which the Company has
received notice, and no waivers of statutes of limitation have been
given or requested. The federal income tax liabilities of the Company
have never been audited by the IRS.
2.12 TITLE TO PROPERTIES; MOLDS.
(a) Schedule 2.12(a) sets forth: (i) a true and complete list of
all real property leases of the Company and all personal property
leases to which the Company is a party as lessee as of the date hereof
involving an annual lease payment of more than $10,000, including an
identification of the parties, the property, the term of the lease and
the rent or lease payments thereunder; and (ii) a true and complete
list of all real property owned by the Company as of the date hereof
(the "Real Property"), including an identification of the property,
the record owner and the principal structures on it.
(b) Except as set forth in Schedule 2.12(b), the Company has
good and marketable title to all of its properties and assets, real,
personal and mixed, including intangibles, free and clear of all
mortgages, liens, pledges, charges or encumbrances of any nature
whatsoever, and has taken all steps necessary or otherwise required to
perfect and protect its rights in and to its properties and assets,
including intangibles. All properties and assets owned and currently
used by the Company in the Company's business are in good condition
and state of repair that permits the Company to operate its business
in a manner consistent with past operations and are not in violation
of any applicable laws, including, without limitation, building and
zoning laws, and no actual notice of any violation of building or
other laws, statues, ordinances or regulations relating to such
business, property or assets has been received. All of the Company's
assets are at the locations listed in Schedule 2.12(b).
(c) All molds owned by the Company for products currently in the
Company's current product offering are in good operating condition,
subject to ordinary wear and tear. All molds are at the locations
listed in Schedule 2.12(c).
2.13 CONTRACTS AND COMMITMENTS. Except for agreements as
described in Schedule 2.13, the Company has no written or oral
contracts, commitments or other agreements or arrangements, including
-19-<PAGE>
any notes, loans agreements, guarantees or other evidences of
indebtedness of the Company, involving an aggregate consideration with
a value in excess of $50,000, or any contracts, commitments or other
agreements or arrangements with any Affiliated Person.
All of such contracts, commitments or other agreements or
arrangements to which the Company is a party or by which any of its
assets or properties are bound or affected are in full force and
effect and to the best knowledge of the Company and the Shareholders
no event or condition has occurred or exists or is alleged by any of
the other parties thereto to have occurred or exist, which constitutes
or with lapse of time or giving of notice might constitute a default
or basis for acceleration under any such contract, commitment,
arrangement or other agreement. The Company has not given any
revocable or irrevocable power of attorney to any person, firm or
corporation for any purpose whatsoever.
2.14 EMPLOYEE RELATIONS. The Company is not a party to any
collective bargaining agreement covering or relating to any of its
employees and has not recognized, is not required to recognize and
during the past five years has not received a demand for recognition
by any collective bargaining representative or experienced any strikes
or work stoppages or slowdowns. To the best knowledge of the officers
of the Company, the Company is in compliance with all applicable laws,
rules or regulations relating to employment or employment practices,
including those relating to wages, hours, collective bargaining and
the withholding and payment of taxes and contributions, and the
Company is in compliance with the Occupational Safety and Health Act
and applicable Federal Civil Rights laws. The officers of the Company
have no actual knowledge of any controversies pending or threatened
between the Company and any of its employees.
2.15 EMPLOYEE BENEFIT PLANS.
(a) DEFINITIONS. For purposes of this Section 2.15:
(i) ARRANGEMENTS. The term "Arrangements" means any
personnel policy (including, but not limited to, vacation time,
holiday pay, bonus programs, moving expense reimbursement
programs and sick leave), salary reduction agreements,
change-in-control agreements, employment agreements, consulting
agreements or any other benefit, program, agreement or contract,
whether or not written, (1) which currently or since April 1,
1992, is being or has been maintained for employees of the
Company, or (2) to which the Company makes or is required to make
or since April 1, 1992, made or was required to make,
contributions.
(ii) PLAN. The term "Plan" includes each employee benefit
plan, as defined in Section 3(3) of the Employee Retirement
Income Security Act ("ERISA") (other than a Multiemployer Plan
and including terminated Plans) (1) which currently or since
April 1, 1992, is being or has been maintained for employees of
the Company or of any Control Group member, or (2) to which the
Company or any Control Group member makes or is required to make,
-20-<PAGE>
or since April 1, 1992, made or was required to make,
contributions.
(iii) MULTIEMPLOYER PLAN. The term "Multiemployer Plan"
means any employee benefit plan that is a "multiemployer plan"
within the meaning of Section 3(37) of ERISA and to which the
Company or any Control Group member has or has ever had any
obligation to contribute.
(b) PLANS LISTED. All Arrangements, Plans and Multiemployer
Plans are set forth on Schedule 2.15.
(c) OPERATIONS OF PLANS.
(i) Each Arrangement and each Plan has been administered in
all material respects in compliance with its terms and with all
filing, reporting, disclosure and other requirements of all
applicable statues (including, but not limited to, ERISA, the
Code and the Consolidated Omnibus Budget Reconciliation Act of
1986), regulations and interpretations thereunder.
(ii) All oral or written communications with respect to each
Arrangement and each Plan currently and in the past reflect and
have reflected in all material respects the documents and
operations of the Arrangement or Plan and no person has or had
any liability by reason of any such communication or any failure
to communicate with respect to any Arrangement or Plan.
(iii) Neither the Company nor any employees or
directors, nor any fiduciary, has engaged in any transaction,
including the execution and delivery of this Agreement and other
agreements, instruments and documents for which execution and
delivery by the Company is contemplated herein, in violation of
Section 406(a) or (b) of ERISA or which is a "prohibited
transaction" (as defined in Section 4975(c)(1) of the Code) for
which no exemption exists under Section 408(b) of ERISA or
Section 4975(d) of the Code or for which no administrative
exemption has been granted under Section 408(a) of ERISA.
(iv) Each Qualified Plan (together with its related funding
instrument) is qualified and tax exempt under Section 401 and 501
of the Code and is the subject of a favorable Internal Revenue
Service determination with respect to such qualification and
exemption.
(v) No matter is pending relating to any Arrangement or
Plan before any court or governmental agency.
(vi) Every fiduciary and official of each Plan is bonded to
the extent required by Section 412 of ERISA, and no civil or
criminal action with respect to any Arrangement or Plan, pursuant
to any federal or state law, has been brought, is pending or is
threatened, against the Company, any subsidiary or affiliate
thereof, any officer, director or employee thereof or any
fiduciary of any Plan.
-21-<PAGE>
(vii) No Plan fiduciary or any other person has, or has
had, any liability to any participant or beneficiary under any
Plan or Arrangement or to any other person under any provisions
of ERISA or any other applicable law by reason of any action or
failure to act in connection with any Plan or Arrangement,
including, but not limited to, any liability by any reason of any
payment of, or failure to pay, benefits or any other amounts or
by reason of any credit or failure to give credit for any
benefits or rights, except for benefits payable in the normal
operation of the Plan or Arrangement.
(viii) Except as set forth on Schedule 2.15(c), there are
no Plans or Arrangements to which the Company is a party or by
which it is bound and under which, as a result of this Agreement
or any other particular transaction, any director, officer,
employee or other agent of the Company shall or may acquire
rights with respect to any Plan or Arrangement (including,
without limitation, the creation, increase or extension of new or
existing rights), become entitled to a distribution or payment
with respect to any Plan or Arrangement at a date earlier than if
this Agreement had not been signed or such other transaction had
not occurred, or otherwise receive or become vested in rights or
benefits with respect to any Plan or Arrangement.
(d) PLAN DOCUMENTS AND RECORDS.
(i) Complete and correct copies of all current and prior
documents as in effect after January 1, 1990, including all
amendments thereto, with respect to each Arrangement and Plan,
have been heretofore delivered to Newell. These documents
include, but are not limited to, the following: Plan and
Arrangement documents, trust agreements, insurance contracts,
annuity contracts, summary plan descriptions, filings with
governmental agencies, investment manager and investment adviser
contracts, actuarial reports, audit reports, financial
statements, premium reports to PBGC (Form PBGC1), Internal
Revenue Service determination letters, Internal Revenue Service
recognitions of exemption, annual reports (Form 5500) for the
most recent three plan years ending prior to the date hereof and
any other general explanation or communication distributed or
otherwise provided to participants in such Arrangement or Plan
which describes all or any relevant aspect of each Arrangement or
Plan.
(ii) At the Effective Time, the participant or beneficiary
records with respect to each Arrangement and Plan shall be in the
custody of the persons listed on Schedule 2.15(d). All such
records accurately set forth, in all material respects, the
history of each participant and beneficiary in connection with
each Arrangement and Plan and accurately state, in all material
respects, the benefits earned and owed to each such person as of
the date hereof.
-22-<PAGE>
(e) FINANCES.
(i) The Company does not currently maintain nor has ever
maintained a Title IV Plan.
(ii) All contributions payable to each Qualified Plan for
all benefits earned and other liabilities accrued through
December 31, 1992, determined in accordance with the terms and
conditions of such Qualified Plan, ERISA and the Code, have been
paid or otherwise provided for, and, to the extent unpaid, are
reflected in the Company Balance Sheet.
(iii) Set forth on Schedule 2.15(e) is (1) the amount of
the liability for minimum contributions for the last three plan
years to any Qualified Plan, (2) the approximate amount of the
minimum contribution to any Qualified Plan for the plan year
during which the Closing Date is to occur, and (3) the annual
cost of providing coverage under any Plan that is a welfare plan
as defined in Section 3(1) of ERISA to all former employees of
the Company and all dependents of a former employee.
(f) MULTIEMPLOYER PLANS. The Company has no Multiemployer
Plans. Pursuant to the Agreement between Ashland Products, Inc. and
Plastic Workers' Union Local No. 18 AFL-CIO, the Company was formerly
obligated to contribute to the Midwest Pension Plan and the Central
States Joint Board, Health and Welfare Trust Fund.
2.16 INTELLECTUAL PROPERTY. Schedule 2.16 sets forth a current
and complete list of all letters, patent, patent application, trade
names, trademarks, service marks, trademark registrations and
applications, copyrights and copyright registrations and applications,
and all other rights with respect to intellectual property, both
domestic and foreign, presently owned, possessed, used or held by the
Company (the "Intellectual Property"), and the Company owns the entire
right, title and interest in and to the same, except as set forth in
Schedule 2.16. Schedule 2.16 also sets forth a correct and complete
list of all licenses granted to the Company by others and to others by
the Company. Neither the conduct of the Company's business nor any of
the products it sells or services it provides infringes upon the
rights of any other person and the conduct of any other person's
business or any of the products it sells of services it provides does
not infringe upon any of the Company's rights. The Company has no
liability for and has not given any indemnification for patent,
trademark or copyright infringement as to any products manufactured,
used or sold by it or with respect to services rendered by it.
2.17 CONFLICTING INTERESTS. Except as set forth on Schedule
2.17, the Shareholders have no direct or indirect interest in any
competitor, customer, supplier or other person, firm or corporation
which has had any business relationship or material transaction with
the Company during the last three years or which is a party to, or has
property which is the subject of, any business arrangement with the
Company.
-23-<PAGE>
2.18 ENVIRONMENTAL MATTERS.
(a) DEFINED TERMS. For purposes of this Agreement, the
following terms shall have the following meanings:
(1) "Regulated Materials" shall mean those materials or
substances defined as "hazardous substances," "hazardous
materials," "hazardous waste," "toxic substances," "toxic
pollutants," "petroleum products" or similar designations
under the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended, 42 U.S.C. Sections
9601, et seq. ("CERCLA"), the Resource Conservation and
Recovery Act, as amended, 42 U.S.C. Section 6901, et seq.
("RCRA"), and the Hazardous Materials Transportation Act, 49
U.S.C. Section 1801, et seq. or regulations promulgated
pursuant thereto.
(2) "Governmental Agency" means any federal, state, local or
foreign government, political subdivision, court, agency or
other entity, body, organization or group exercising any
executive, legislative, judicial, quasi-judicial, regulatory
or administrative function of government with authority or
jurisdiction of the business of the Company, the assets and
properties owned or leased by the Company, or the operation
conduct or occupancy thereof.
(3) "Environmental Laws" shall mean any requirement of federal,
state, or local law, civil or criminal, or regulation,
relating to air quality, surface water quality, ground water
quality, soil, solid waste management, hazardous or toxic
substances, or the protection of human health or the
environment, set forth in or promulgated pursuant to the
Federal Water Pollution Control Act ("FWPCA"), 33 U.S.C. Sect.
1251 et seq., its regulations and equivalent or similar
state statute and regulations; the Resource Conservation and
Recovery Act ("RCRA"), 42 U.S.C. Sect. 6901 et seq., its
regulations and equivalent or similar state statute and
regulations; the Comprehensive Environmental Response,
Compensation, and Liability Act ("CERCLA"), 42 U.S.C. Sect. 9601
et seq., its regulations and equivalent or similar state
statute and regulations; and the Hazardous Material
Transportation Act ("HMTA"), 49 U.S.C. Ap. Sect. 1471, its
regulations and equivalent or similar state statute and
regulations.
(4) "Hazardous Waste" shall have the meaning set forth in RCRA
Section 1004(5).
(5) "Hazardous Substance" shall have the meaning set forth in
CERCLA Section 101(14).
(b) Except as set forth in Schedule 2.18, the Company has
complied with applicable Environmental Laws and any valid undisputed
orders and directives of any Governmental Agency.
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(c) Except as set forth in Schedule 2.18, the Company has not
been charged with, nor has the Company received any written notice of,
and no officer of the Company has received any oral notice, that the
Company is under investigation for the failure to comply with any
Environmental Laws or any orders and directives of any Governmental
Agency with respect to the use, generation, storage, transportation,
handling, abandoning, dumping, releasing, leaching, escaping, burying,
disposing, discharging or emitting of any Regulated Materials
pertaining to the business of the Company, the assets and properties
owned or leased by the Company, or the operation, conduct or occupancy
thereof.
(d) Except as set forth in Schedule 2.18, the Company has not
received from any Governmental Agency or private party any (i)
complaint or notice asserting potential liability, (ii) since April 1,
1992, requests for information, or (iii) request to investigate or
clean up any site under the FWPCA, CERCLA, or under any state law
comparable thereto.
(e) Each transporter and disposal facility that has transported
or disposed of any Hazardous Waste on behalf of the Company, if any,
is listed in Schedule 2.18. All manifests in the possession of the
Company have been made available to Newell prior to the Closing and
are included in Schedule 2.18.
(f) Except as set forth in Schedule 2.18, there has not been a
release of a reportable quantity a Hazardous Substance at or from any
Company facility.
(g) There are no underground storage tanks, as defined by RCRA
and applicable state law, located on any real property now owned or
leased by the Company, and the Company is not a transfer, storage or
disposal (TSD) facility requiring a Part B RCRA permit.
(h) The Company has made available to Newell all known written
reports issued to Governmental Agencies by or on behalf of the
Company, or by any of its representatives or consultants, with respect
to environmental matters. All environmental audits, assessments and
studies within the possession of the Company regarding real property
now owned or leased by the Company are identified in Schedule 2.18.
(i) Each of the representations and warranties contained in this
Section 2.18 shall be in addition to, and not in lieu of, any other
representation or warranty contained in this Agreement.
2.19 ABSENCE OF UNDISCLOSED LIABILITIES. For the purposes of
this Section 2.19, "material" shall mean having a value of $25,000
individually or $100,000 in the aggregate. The Company does not have
any material liabilities or obligations due or to become due, whether
absolute, accrued, contingent or otherwise, and there are no material
claims or causes of action that may be asserted against the Company
which arise with respect to or relate to any period or periods on or
prior to the date hereof, except (a) as, and to the extent, set forth
or specifically reserved against on the Company Balance Sheet; (b) for
liabilities incurred since April 30, 1995 in the ordinary course of
business consistent with past practice (including without limitation,
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for chargebacks, returns and similar matters pursuant to the Company's
ordinary course arrangements and practices with respect to such matter
as reflected in Schedule 2.19); and (c) for any other matters
disclosed in or pursuant to this Agreement (including its disclosure
schedules).
2.20 INSURANCE. The Company has in full force and effect the
policies of insurance listed in the amounts described in Schedule 2.20
hereto, and all premiums due thereon have been paid. The Company does
not have any interest in any other insurance policy. Schedule 2.20
accurately reflects the insurance claims experience of the Company for
the past three years.
2.21 CUSTOMERS AND SUPPLIERS. Schedule 2.21 contains a list of
the Company's 20 largest customers and 10 largest suppliers (measured
by dollar volume of purchases and sales, as applicable) during each of
the last three fiscal years and the percentage or dollar volume of the
Company's business which each such customer or supplier represented.
Except as described in Schedule 2.21 the Company is not presently
engaged in any disputes with customers or suppliers. To the best
knowledge of the officers of the Company, no customer or supplier is
considering, termination or non-renewal of its arrangements with the
Company which would in the aggregate have a material adverse effect on
the Company. At no time during the two years prior to the date hereof
have the sales, manufacturing or other business operations of the
Company been materially affected by shortages or availability of
products or raw materials necessary to sell or manufacture the
products presently sold by the Company.
2.22 PRODUCT QUALITY. The Company has heretofore delivered to
Newell true and complete copies of any standard written warranties,
extended by the Company with respect to its products. No claims have
been made against the Company for (a) credit or refunds with respect
to products returned or returnable by customers, except in the normal
course of business, or (b) personal injury arising out of events
occurring on or prior to the date hereof based upon defective
products, any violation of express or implied product warranties, or
similar claims with respect to products delivered by the Company to
customers or distributors on or prior to the date hereof.
2.23 BROKERS AND FINDERS. Other than as described on Schedule
2.23, neither the Company nor the Shareholders has employed any broker
or finder or incurred any liability for any brokerage fees,
commissions or finders' fees, and no broker or finder has acted
directly or indirectly for the Company or the Shareholders in
connection with this Agreement, the Plan of Merger or the transactions
contemplated hereby and thereby.
2.24 DISCLOSURE. No representation, warranty or other statement
by the Company or the Shareholders herein or in the schedules hereto,
or in any other document entered into in connection with this
Agreement, contains or will contain an untrue statement of material
fact, or omits or will omit to state a material fact necessary to make
the statements contained herein or therein not misleading.
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ARTICLE III
Representations and Warranties of Newell and Acquisition
Newell and Acquisition jointly and severally represent and
warrant to the Company that:
3.01 ORGANIZATION AND AUTHORITY. Each of Newell and Acquisition
is duly organized, validly existing and in good standing under the
laws of Delaware, with power to own its property and to carry on its
business as now being conducted, and each is qualified in each other
jurisdiction in which qualification is required for it to hold the
property or conduct the business it holds or conducts therein, except
to the extent that all failures of both such entities so to qualify in
the aggregate would not have a Material Adverse Effect on the
financial condition, business or operations of Newell and its
subsidiaries taken as a whole.
3.02 CAPITALIZATION. The authorized capital stock of Newell
consists of (a) 400,000,000 shares of Newell Common Stock, $1.00 par
value, of which 157,909,000 shares are issued and outstanding, and (b)
10,000,000 shares of Preferred Stock consisting of (i) 10,000 shares
without par value, of which no shares are issued and are outstanding
and (ii) 9,990,000 shares of Preferred Stock, $1.00 par value, of
which no shares are issued or outstanding. The authorized
capitalization of Acquisition consists of 1,000 shares of Common
Stock, par value $1.00 per share, of which all 1,000 shares are issued
and outstanding and owned directly by Newell.
3.03 AUTHORIZATION. Newell and Acquisition have full power and
authority to enter into this Agreement and the Plan of merger and to
carry out their obligations hereunder and thereunder. The
transactions contemplated hereby and thereby have been duly authorized
by their respective Boards of Directors and by Newell as the sole
shareholder of Acquisition, and no other corporate proceedings on the
part of Newell or Acquisition are necessary to authorize this
Agreement, the Plan of merger and the transactions contemplated hereby
and thereby. This Agreement and the Plan of Merger are valid and
binding obligations of Newell and Acquisition enforceable against
Newell and Acquisition in accordance with their terms, except as
enforcement may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors rights generally and by
principles of equity. Neither the execution and delivery of this
Agreement nor the Plan of Merger by Newell and Acquisition, nor the
consummation of the transactions contemplated hereby and thereby, nor
compliance by Newell and Acquisition with any of the provisions hereof
or thereof will (i) violate, conflict with, or result in a breach of
any provisions of, or constitute a default (or an event which, with
notice or lapse of time or both, would constitute a default) under, or
result in the termination of, or accelerate the performance required
by, or result in a right of termination or acceleration, or result in
the creation of any lien, security interest, charge or encumbrance
upon any of the properties or assets of Newell, under any of the
terms, conditions or provisions of (x) the charter or by-laws of
Newell or Acquisition or (y) any note, bond, mortgage, indenture, deed
of trust, license, lease, agreement or other instrument or obligation
to which Newell or Acquisition is a party, or by which either of them
-27-<PAGE>
is, or any of their properties or assets may be subject, or (ii)
violate any judgment, ruling, order, writ, injunction, decree,
statute, rule or regulation applicable to Newell or any of its
properties or assets. Other than in connection with or in compliance
with the provisions of the Corporation Law of the State of Delaware,
the Securities Act, the securities laws of the various states, no
notice to, filing with, or authorization, consent or approval of, any
public body or authority is necessary for the consummation by Newell
or Acquisition of the transactions contemplated by this Agreement and
the Plan of Merger.
3.04 BROKERS AND FINDERS. Except as described in Schedule 3.04,
neither Newell nor any of its subsidiaries, nor any of their officers,
directors or employees has employed any broker or finder or incurred
any liability for any financial advisory fees, brokerage fees,
commission or finders' fees, and no broker or finder has acted
directly or indirectly for Newell or any of its subsidiaries in
connection with this Agreement or the Plan of Merger or the
transactions contemplated hereby and thereby.
3.05 DISCLOSURE. Newell has not made any material
misrepresentation to Ashland or Gaffney relating to this Agreement or
the Newell Common Stock and Newell has not omitted to state to Ashland
or Gaffney any material fact relating to this Agreement or the Newell
Common Stock which is necessary in order to make the information given
by or on behalf of Newell to Ashland or Gaffney at or prior to Closing
(including Newell's reports under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), all of which reports required to be
filed by Sections 13 and 15(d) of the Exchange Act during the
preceding 12 months have been filed on a timely basis) not misleading
or which if disclosed would reasonably affect the decision of a person
considering an acquisition of the Newell Common Stock.
3.06 CURRENT PLANS AND INTENTIONS. It is the current plan and
intention of Newell that:
(i) Newell will not reacquire any of the Newell Common
Stock issued in the Merger, to liquidate Acquisition with or into
any other corporation, sell or otherwise dispose of Acquisition's
stock (except for transfers of stock to corporations controlled
by Newell), or cause Acquisition to sell or otherwise dispose of
any of its assets or any of the assets acquired from the Company
(except for sales and dispositions made in the ordinary course of
business or sales or transfers of assets as permitted by Section
368(a)(2)(C) of the Code). Newell intends that Acquisition,
after the consummation of the Merger, continue the business of
the Company. Newell does not directly or indirectly own, nor has
it directly or indirectly owned during the past five years, any
shares of stock of the Company;
(ii) Acquisition will acquire at least 90% of the fair
market value of the Company's net assets and at least 70% of the
fair market value of the Company's gross assets held by Company
immediately prior to the Merger. For purposes of this
representation, amounts paid by the Company to its shareholders
who receive cash or other property, Company assets used to pay
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its reorganization expenses, and all redemptions and
distributions (except for regular, normal dividends) made by the
Company immediately preceding the Merger will be included as
assets of the Company held immediately prior to the Merger;
(iii) Immediately prior to the Merger, Newell will be in
control of Acquisition within the meaning of Section 368(c) of
the Code;
(iv) Newell will not cause Acquisition the Company to issue
additional shares of Acquisition's stock that would result in
Newell losing control of Acquisition within the meaning of
Section 368(c) of the Code;
(v) Immediately following the Merger, Acquisition will
continue historic business of the Company or use a significant
portion of the Company's historic business assets in a business
within the meaning of Treas. Reg. Sect. 1.368-1(d);
(vi) Newell and Acquisition will pay their respective
expenses, if any, incurred in connection with the transaction;
(vii) The payment of cash in lieu of fractional shares
of Newell Common Stock is solely for the purpose of avoiding the
expense and inconvenience to Newell of issuing fractional shares
and does not represent separately bargained-for consideration.
The total cash consideration that will be paid in the Merger to
Gaffney instead of issuing fractional shares of Newell Common
Stock will not exceed one percent of the total consideration that
will be issued in the Merger to Gaffney in exchange for the
Gaffney Stock;
(viii) None of the compensation received by any
shareholder-employees of the Company will be separate
consideration for, or allocable to, any of their shares of
Company Common Stock; none of the shares of Newell Common Stock
received by any shareholder-employees will be separate
consideration for, or allocable to, any employment agreement; and
the compensation paid to any shareholder-employees will be for
services actually rendered and will be commensurate with amounts
paid to third parties bargaining at arm's-length for similar
services.
(ix) Neither Newell nor Acquisition are "investment
companies" as defined in Section 368(a)(2)(F)(iii) and (iv) of
the Code.
(x) The fair market value of the assets of the Company
transferred to Acquisition will equal or exceed the sum of the
liabilities assumed by Acquisition, plus the amount of
liabilities, if any, to which the transferred assets are subject.
(xi) No stock of Acquisition will be issued in the
transaction.
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(xii) There is no intercorporate indebtedness existing
between Newell and the Company, or between Acquisition and the
Company, that was issued, acquired or will be settled at a
discount.
3.07 NEWELL COMMON STOCK. The shares of Newell Common Stock
to be issued and delivered pursuant to the provisions of this
Agreement will on the Closing Date (i) have been validly issued
and outstanding, fully paid and non-assessable, (ii) be eligible
to vote in the election of Newell's Board of Directors and at the
Closing, and Newell shall not have received any stop order or any
similar order from the Securities and Exchange Commission or
other applicable regulatory agency which would prevent the
registration of the Newell Common Stock. The shares of Newell
Common Stock to be issued and delivered pursuant to the
provisions of this Agreement will be listed on the New York Stock
Exchange pursuant to a listing application to be filed not later
than twenty days after the Closing Date.
3.08 CONSIDERATION. The consideration to be delivered to the
Shareholders pursuant to this Agreement, the Plan of Merger and the
Warrant Purchase Agreement is all of the consideration to be delivered
in exchange for the Gaffney Stock, the Prete Option, the Adkisson
Option, the GECC Stock and the GECC Warrant (collectively the "Ashland
Equity"). No other consideration has been or will be delivered to any
party in exchange for the Ashland Equity.
ARTICLE IV
CONDUCT OF BUSINESS PRIOR TO THE EFFECTIVE TIME
4.01 CONDUCT OF THE COMPANY'S BUSINESS PRIOR TO THE EFFECTIVE
TIME. During the period from the date of this Agreement to the
Effective Time, the Company shall conduct its operations according to
its ordinary and usual course of business consistent with past and
current practices and use its best efforts to maintain and preserve
its business organization, prospects, employees and advantageous
business relationships and shall not, without the prior written
consent of the Chief Executive Officer, the President or a Vice
President of Newell, take any action or permit to occur any event set
forth in Section 2.08.
ARTICLE V
ADDITIONAL AGREEMENTS
5.01 ACCESS AND INFORMATION. The Company shall afford to Newell
and to its accountants, counsel and other representatives, full access
during regular business hours and upon reasonable notice, during the
period prior to the Effective Time, to all of the properties, books,
contracts, commitments and records of the Company, and, during such
period, the Company shall furnish promptly to Newell all other
information concerning the business, properties and personnel of the
Company as Newell may reasonably request.
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5.02 MISCELLANEOUS AGREEMENTS AND CONSENTS. Subject to the terms
and conditions herein provided, each of the parties hereto shall use
all reasonable efforts to take, or cause to be taken, all action, and
to do, or cause to be done, all things necessary, proper or advisable
under applicable laws and regulations to consummate and make effective
the transactions contemplated by this Agreement and the Plan of
Merger, including, without limitation, using reasonable efforts to
satisfy the conditions contained in Article VI hereof. The Company
and Newell will use their best efforts to obtain consents of all third
parties and governmental bodies necessary or, in the opinion of both
parties, desirable for the consummation of the transactions
contemplated by this Agreement and the Plan of Merger. In case at any
time after the Effective Time any further action is necessary or
desirable to carry out the purposes of this Agreement and the Plan of
Merger, the proper officers and/or directors of the Company, Newell or
Acquisition, as the case may be, shall take all such necessary
action. Prior to the earlier of the Effective Time or the earlier
termination of this Agreement pursuant to Article VII hereof, each
Shareholder shall except as set forth on Schedule 5.03, (i) continue
to own, of record and beneficially, all right, title and interest to
the shares of Company Common, Special and Preferred (including options
and warrants relating thereto) owned as of the date hereof, free and
clear of all security interests, liens, claims, pledges, escrows,
options, warrants, rights of purchase, equities, charges,
encumbrances, proxies, voting trusts and restrictions on voting rights
whatsoever, and (ii) not enter into any contract, agreement,
understanding or restriction of any kind relating to any shares of
Company Common, Special and Preferred (including options and warrants
relating thereto). During the period from the date of this Agreement
to the Effective Time, or such earlier termination of the Agreement
pursuant to Section 9 hereof, the Company shall not and shall cause
its directors, officers, agents and employees not to solicit,
authorize the solicitation of or enter into any discussion (or
continue any discussion) with any third party (including the provision
of any information to a third party regarding the Company) concerning
any offer or possible offer from any such third party (i) to issue or
purchase any Company Common, Special and Preferred, any option or
warrant to purchase Company Common, Special and Preferred, or any
securities of the Company, (ii) to purchase, lease or otherwise
acquire all or a substantial portion of the assets of the Company
relating to the Business or (iii) to merge, consolidate or otherwise
combine with the Company.
5.03 INTERIM FINANCIAL STATEMENTS. During the period prior to
the Effective Time, the Company shall deliver to Newell monthly an
unaudited balance sheet as at the end of such month and the unaudited
statements of income and stockholders' equity of the Company for a
period then ended (the "Interim Financial Statements"). The Interim
Financial Statements shall be correct and complete and shall fairly
present the financial condition, stockholders' equity, and results of
operations of the Company as of the respective dates and the Interim
Financial Statements shall be prepared in accordance with generally
accepted accounting principles consistently applied throughout the
periods involved.
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5.04 CERTAIN NOTIFICATIONS. At all times until the Effective
Time, each party shall promptly notify the other in writing of the
occurrence of any event which will or may result in the failure to
satisfy any of the conditions specified in Article VI.
5.05 PRESS RELEASES. The parties agree that, except as otherwise
provided by law, no press release or other public announcement with
respect to this Agreement or the transactions contemplated hereby
shall be made without the prior approval of all parties hereto.
5.06 TRANSACTIONAL COSTS. Each party hereto shall pay or be
responsible for its or his expenses in connection with the
transactions contemplated by this Agreement. The Company shall be
responsible for expenses incurred by the Company and its shareholders
after May 1, 1995, in connection with the transactions contemplated by
this Agreement in an amount not to exceed One Hundred Thirty Thousand
Dollars ($130,000).
5.07 CONFIDENTIALITY AND NON-USE. If for any reason the
transactions contemplated by this Agreement are not completed, then
Newell and Acquisition agree to return to the Company (and not
thereafter use in their own businesses or otherwise or disclose the
contents thereof) all documents, data and other materials respecting
the Company's business furnished to or obtain by either Acquisition or
Newell or its representatives pursuant to the access granted pursuant
to Section 5.01 or previous thereto.
ARTICLE VI
CONDITIONS
6.01 CONDITIONS TO EACH PARTY'S OBLIGATIONS TO CONSUMMATE THE
MERGER. The respective obligations of each party to consummate the
Merger shall be subject to the fulfillment at or prior to the
Effective Time of the following conditions:
(a) AUTHORIZATION. The Plan of Merger shall have been approved
and adopted by the requisite vote of the holders of the outstanding
shares of the Company's Common, Special and Preferred.
(b) PROCEEDINGS. At the Effective Time there shall be no action
or proceeding initiated by any governmental agency or any third party
pending which seeks to restrict, prohibit or invalidate any material
transaction contemplated by this Agreement or the Plan of Merger or to
recover substantial damages or other substantial relief with respect
thereto and no injunction or restraining order shall have been issued
by any court restraining, prohibiting or invalidating any such
material transaction.
6.02 CONDITIONS TO OBLIGATIONS OF THE COMPANY TO CONSUMMATE THE
MERGER. The obligations of the Company to consummate the Merger shall
be subject to the fulfillment (or waiver by the Company and the
Shareholders) at or prior to the Effective Time of the following
conditions:
(a) REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Newell and Acquisition set forth in Article III hereof
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shall be true and correct as of the date of this Agreement and as of
the Effective Time as though made on and as of the Effective Time,
except as otherwise contemplated by this Agreement, and the Company
shall have received a certificate signed by the Chief Executive
officer, the President or a Vice President of Newell to that effect.
(b) PERFORMANCE OF OBLIGATIONS. Newell shall have performed all
obligations required to be performed by it under this Agreement prior
to the Effective Time, and the Company shall have received a
certificate singed by the Chairman of the Board, the President or a
Vice President of Newell to that effect.
(c) PERMITS, AUTHORIZATIONS, ETC. Newell shall have obtained
any and all material permits, authorizations, consents or approvals of
state securities commissions and of any other public body or authority
required for the lawful consummation of the Merger.
(d) OPINION OF ASSISTANT GENERAL COUNSEL. Richard H. Wolff,
Assistant General Counsel for Newell, shall have furnished to the
Company its opinion as of the Closing in the form and to the effect
set forth in Exhibit B hereto.
(e) All indebtedness of the Company to GECC under and pursuant
to that certain Amended and Restated Loan Agreement dated June 29,
1993, as amended, shall have been paid in full by Newell or
Acquisition.
(f) Acquisition shall have executed an employment agreement with
Prete.
(g) Newell shall have executed the Escrow Agreement (as defined
in Section 6.03(f)).
6.03 CONDITIONS TO OBLIGATIONS OF NEWELL AND ACQUISITION TO
CONSUMMATE THE MERGER. The obligations of Newell and Acquisition to
consummate the Merger shall be subject to the fulfillment (or waiver
by Newell and Acquisition) at or prior to the Effective Time of the
following conditions:
(a) REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Company set forth in Article II hereof shall be true
and correct as of the date of this Agreement and as of the Effective
Time as though made on and as of the Effective Time, except as
otherwise contemplated by this Agreement, and Newell shall have
received a certificate signed by the Chairman or a Vice President of
the Company to that effect.
(b) PERFORMANCE OF OBLIGATIONS. The Company shall have
performed all obligations required to be performed by it under this
Agreement prior to the Effective Time, and Newell shall have received
a certificate signed by the Chairman or a Vice President of the
Company to that effect.
(c) PERMITS, AUTHORIZATIONS, ETC. The Company shall have
obtained any and all consents or waivers from other parties to
contracts other than loan agreements material to the Company's
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business for the lawful consummation of the Merger, and the Company
and Newell shall have obtained any and all permits, authorizations,
consents or approvals of state securities commissions and of any other
public body or authority required for the lawful consummation of the
Merger.
(d) FINANCIAL STATEMENTS. Newell and Acquisition shall have
received the Interim Financial Statements.
(e) OPINION OF COUNSEL. Dykema Gossett PLLC, counsel for the
Company, shall have furnished to Newell its opinion as of the Closing
in the form and to the effect set forth in Exhibit C hereto.
(f) ESCROW AGREEMENT. Gaffney, Prete and Adkisson shall have
executed an escrow agreement in form of Exhibit D hereto regarding the
escrow of cash and certain of their shares of Newell Common Stock to
be received in the Merger for the purpose of indemnifying Newell
against breaches of the representations, warranties, covenants and
agreements contained in this Agreement (the "Escrow Agreement").
(g) EMPLOYMENT AGREEMENT. Prete shall have executed an
Employment Agreement with Acquisition.
(h) The Company shall have terminated the 1994 Executive Bonus
Plan.
ARTICLE VII
TERMINATION, AMENDMENT
7.01 TERMINATION.
(a) This Agreement may be terminated at any time prior to the
Effective Time, whether before or after approval by the Shareholders
(i) by mutual consent of the Company and Newell;
(ii) by either the Company or Newell if the Merger has not
taken place by June 30, 1995, unless the failure of the Merger to
take place by that date is the result of a breach of any
provision of this Agreement by the party seeking to terminate;
(iii) by Newell if any of the conditions contained in
Sections 6.01 and 6.03 have not been satisfied prior to the
Closing, unless the failure of such condition is the result of a
breach of any provision of this Agreement by Newell;
(iv) by the Company if any of the conditions contained in
Sections 6.01 or 6.02 have not been satisfied prior to the
Closing, unless the failure of any such condition is the result
of a breach of any provision of this Agreement by the Company.
(b) In the event this Agreement is terminated pursuant to
Section 7.01, such termination shall be without any liability or
further obligation of any party to another and the obligations and
agreements in this Agreement shall terminate and have no further
effect except for liabilities and obligations based on any intentional
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failure to perform or comply with any covenant or agreement herein or
for any intentional misrepresentation or material breach of any
warranty herein (and such termination shall not constitute a waiver of
any claim with respect thereto).
7.02 AMENDMENT. Subject to applicable law, this Agreement may be
amended, modified or supplemented only by written agreement of the
parties hereto duly authorized by the respective Board of Directors at
any time prior to the Effective Time; provided, however, that, after
the approval and adoption of the Plan of Merger by the Shareholders,
no such amendment, modification or supplement shall change the amount
or the form of the consideration to be delivered to the Shareholders
as contemplated by this Agreement and the Plan of Merger.
ARTICLE VIII
SURVIVAL OF REPRESENTATIONS AND WARRANTIES
The representations, warranties, covenants and agreements of the
parties to this Agreement shall survive the execution and delivery of
this Agreement and the consummation of the Merger for a period of one
year notwithstanding any investigations made by any party hereto or,
except as specifically provided otherwise, any actual or constructive
knowledge which any party may have regarding a breach of a
representation or warranty by any other party; provided, however, that
any covenant, agreement, representation or warranty that becomes the
subject of a claim under the Escrow Agreement shall survive until
resolution of such claim.
ARTICLE IX
LIMITATION OF LIABILITY
The parties hereto understand and agree that the Escrow Agreement
and the Warrant Purchase Agreement and the procedures relating thereto
as set forth in the Escrow Agreement and the Warrant Purchase
Agreement have been established as the sole means and method of
providing a remedy to Newell for breach of any of the representations,
warranties, covenants and agreements of the Company hereunder after
the Merger has become effective. Notwithstanding anything contained
in this Agreement to the contrary, Newell agrees that, except to the
extent provision has been made therefor under the Escrow Agreement and
the Warrant Purchase Agreement, the Company and the Shareholders shall
have no liability with respect to any claim, cause of action,
obligation of indemnity, breach of any representation, warranty,
covenant or agreement or other matter of any nature or character
whatsoever arising under or in connection with this Agreement after
the Merger has become effective. Newell agrees that after the Merger
has become effective its exclusive remedy for any such claim, cause of
action, obligation of indemnity, breach of representation or warranty,
or other matter shall be its rights against the Escrow Property (as
defined in the Escrow Agreement) and its rights under the Warrant
Purchase Agreement. Newell further agrees that the liability of the
Shareholders under the Escrow Agreement and the Warrant Purchase
Agreement shall be limited to Six Hundred Fifty Thousand Dollars
($650,000) in the aggregate.
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ARTICLE X
GENERAL PROVISIONS
10.01 NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed given (i) when
delivered personally; (ii) the second business day after being
deposited in the United States mail registered or certified (return
receipt requested); (iii) the first business day after being deposited
with Federal Express or any other recognized national overnight
courier service or (iv) on the business day on which it is sent and
received by facsimile, in each case to the parties at the following
addresses (or at such other address for a party as shall be specified
by like notice):
(a) If to Newell or Acquisition:
Newell Co. Attention: William T. Alldredge
One Millington Road
Post Office Box 117
Beloit, Wisconsin 53511
Facsimile: (608) 365-8290
With copies to: Mr. Richard H. Wolff
Associate General Counsel
Newell Co.
4000 Auburn Street
Rockford, Illinois 61101
Facsimile: (815) 969-6106
(b) If to the Company or the Shareholders:
Mr. Thomas F. Gaffney
2091 Ocean View Drive
Tierra Verde, Florida 33715
Facsimile: (813) 866-3052
With copies to: Rex E. Schlaybaugh, Jr., Esq.
Dykema Gossett PLLC
1577 N. Woodward Ave.
Suite 300
Bloomfield Hills, Michigan 48304
Facsimile: (810) 540-0763
10.02 MISCELLANEOUS. This Agreement (including the exhibits,
documents and instruments referred to herein or therein):
(i) constitutes the entire agreement, and supersedes all
other prior agreements and understandings, both written and oral,
among the parties, or any of them, with respect to the subject
matter hereof;
(ii) is not intended to confer upon any other person any
rights or remedies hereunder;
(iii) shall not be assigned by operation of law or
otherwise; and
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(iv) may be executed in two or more counterparts which
together shall constitute a single agreement.
This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors, heirs, next of
kin, distributees, executors, administrators and personal
representatives.
10.03 WAIVER; REMEDIES. No delay or failure on the part of
any party hereto to exercise any right, power, or privilege hereunder
shall operate as a waiver thereof, nor shall any waiver on the part of
any party hereto of any right, power, or privilege hereunder operate
as a waiver of any other right, power, or privilege hereunder, nor
shall any single or partial exercise of any right, power, or privilege
hereunder preclude any other or further exercise thereof or the
exercise of nay other right, power, or privilege hereunder.
10.04 SEVERABILITY. If any provision of this Agreement shall
be held by any court of competent jurisdiction to be illegal, invalid
or unenforceable, such provision shall be construed and enforced as if
it had been more narrowly drawn so as not to be illegal, invalid or
unenforceable, and such illegality, invalidity or unenforceability
shall have no effect upon and shall not impair the enforceability of
any other provision of this Agreement.
10.05 GOVERNING LAW. This Agreement shall be construed in
accordance with the laws of the State of Delaware (without regard to
principles of conflicts of law) applicable to contracts made and to be
performed within such State.
10.06 ATTORNEY'S FEES. If any party of this Agreement must
bring an action to enforce its terms, the prevailing party in such
action shall be entitled to receive its out-of-pocket fees and
expenses in connection with action from the non-prevailing party or
parties.
* * * * * * *
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IN WITNESS WHEREOF, Newell, Acquisition and the Company have
caused this Agreement to be signed by their respective officers
thereunto duly authorized as of the date first written above.
ASHLAND PRODUCTS, INC.
By: _______________________________
ASHLAND ACQUISITION CO.
By: _______________________________
NEWELL CO.
By: _______________________________
SIGNATURE PAGE TO AGREEMENT AND PLAN OF REORGANIZATION
BY AND AMONG ASHLAND PRODUCTS, INC., NEWELL CO.
AND ASHLAND ACQUISITION CO.
DMC/917
EXHIBIT 2.2
ESCROW AGREEMENT
This Escrow Agreement ("Agreement") is made and entered into
as of June 9, 1995, by and between Newell Co., a Delaware corporation
("Newell"), Thomas F. Gaffney ("Gaffney"), James J. Prete ("Prete"),
and Larry D. Adkisson ("Adkisson") (collectively, the "Shareholders")
and Firstar Trust Company ( the "Escrow Agent").
WHEREAS, Newell, Ashland Acquisition Co., a Delaware
corporation ("Acquisition"), and Ashland Products, Inc., a Delaware
corporation (the "Company"), have entered into an Agreement and Plan
of Reorganization dated as of June 5, 1995 (the "Reorganization
Agreement"), providing for the merger of the Company with and into
Acquisition (the "Merger") and the conversion of the issued and
outstanding capital stock and other securities of the Company into
cash and shares of Common Stock of Newell (the "Newell Common Stock")
pursuant to the Agreement and Plan of Merger dated as of June 5, 1995
between Acquisition and the Company (the "Plan of Merger");
WHEREAS, Newell has relied upon the representations and
warranties of the Company contained in the Reorganization Agreement
and in agreements, schedules, exhibits, certificates and other
documents delivered pursuant to the Reorganization Agreement
(collectively, the "Related Documents");
WHEREAS, one of the conditions precedent to the obligations
of Newell and the Company to consummate the Merger is the execution
and delivery of this Agreement, pursuant to which the Shareholders
agree to indemnify and hold Newell harmless against and in respect of
certain matters more particularly described herein; and this Agreement
is being made to induce Newell to consummate the Merger.
NOW, THEREFORE, in consideration of the mutual covenants,
agreements, representations and warranties herein contained, the
parties agree as follows:
ARTICLE I
The Escrow
1.01 DEPOSIT IN ESCROW. At the Closing (as defined in the
Reorganization Agreement), the Shareholders shall deposit with the
Escrow Agent, to be held in escrow on the terms hereinafter set forth,
cash and Newell Common Stock in the number of shares and amount of
cash set forth opposite each Shareholder's signature hereto (the
"Escrow Cash and Escrow Shares"). Escrow Shares shall be accompanied
by duly executed stock powers endorsed in blank.
1.02 ESCROW PROPERTY. The Escrow Cash and Escrow Shares
deposited in accordance with the terms hereof (the "Escrow Property")
shall be held by the Escrow Agent on the terms hereinafter set forth.
The escrow agent shall cause the Escrow Cash to be maintained and
-39-<PAGE>
invested in demand or time deposits in banks or savings institutions
having at least $100,000,000 in assets, in United States Treasury
bills or in the Portico U.S. Treasury Money Market Fund (collectively,
the "Investments"). No part of the Investments shall have a maturity
date exceeding sixty days from the date on which Escrow Cash is
invested therein. The Escrow Agent shall not be responsible for any
interest or income on the Escrow Cash except the interest or income
actually received.
1.03 DISTRIBUTIONS ON ESCROW PROPERTY. All income accruing on
any investments of the Escrow Cash, and any dividends or distributions
on the Escrow Shares, shall be paid to the Shareholders at such
intervals as the Shareholders may direct in writing and shall not be
part of the Escrow Property.
1.04 TAXES AND CHARGES ON ESCROW PROPERTY. Each Shareholder
shall supply to the Escrow Agent a signed W-9 form and shall be
responsible for and shall pay and discharge all taxes, assessments and
governmental charges imposed on or with respect to his or her
proportionate interest of the Escrow Property. The Escrow Agent shall
report to the Internal Revenue Service the amount of income with
respect to the Escrow Cash as having been received by each of the
Shareholders depositing cash in escrow in accordance with such
Shareholder's proportionate interest of the Escrow Cash.
1.05 VOTING RIGHTS. Escrow Shares held by the Escrow Agent
hereunder shall remain registered in the name of Gaffney, and Gaffney
shall be entitled to exercise all voting rights with respect thereto.
ARTICLE II
Shareholders' Agent
2.01 APPOINTMENT AND AUTHORITY. The Shareholders have appointed
Thomas F. Gaffney as attorney-in-fact for the Shareholders (the
"Shareholders' Agent") for purposes of representing the interests of
the Shareholders in the resolution of claims for indemnification
hereunder and otherwise with respect to this Agreement. The
Shareholders have authorized the Shareholders' Agent to take any and
all actions on behalf of all the Shareholders in connection with this
Agreement, including but not limited to amending this Agreement, and
the Shareholders consent to and agree to be bound by any and all
actions taken by the Shareholders' Agent.
2.02 LIABILITY. The Shareholders' Agent shall not be liable to
any of the Shareholders for any error of judgment, any mistake of fact
or law or any act done or omitted by him as the Shareholders' Agent in
good faith, unless as the result of his willful misconduct.
2.03 VACANCIES. In case of the resignation, death or inability
to act of Thomas F. Gaffney as the Shareholders' Agent, the
Shareholders shall select a successor Shareholders' Agent by a
majority vote, each Shareholder being entitled to one vote.
-40-<PAGE>
ARTICLE III
Indemnification and Other Payments
3.01 INDEMNIFICATION. Notwithstanding any investigation at any
time made by or on behalf of Newell or any information Newell may have
in respect of the business and assets of the Company, the Shareholders
agree, severally and not jointly, to indemnify and hold Newell and its
subsidiaries (including Acquisition) and affiliates (sometimes
collectively referred to as "Newell") harmless from and against any
and all claims, demands, liabilities, actions or causes of action,
losses and damages, including but not limited to reasonable attorneys'
fees, witness fees, and other out-of-pocket expenses and all fines,
penalties, assessments, judgments and amounts paid in settlement
(collectively, "Damages"), suffered or incurred by Newell arising out
of, resulting from or in respect of the following:
(i) any inaccuracy in any representation or breach of any
warranty made by or on behalf of the Company in or pursuant to
the Reorganization Agreement or in any of the Related Documents;
(ii) any failure of the Company duly to perform or observe
any term, provision, covenant, agreement or condition in the
Reorganization Agreement or any of the Related Documents.
3.02 DETERMINATION OF DAMAGES. The aggregate liability of the
Shareholders for Damages incurred pursuant to Section 3.01 of this
Agreement shall be limited to the amount by which such Damages exceed
$100,000.
3.03 INDEMNIFICATION NOTICE. Newell will give written notice
(the "Indemnification Notice") to the Escrow Agent and the
Shareholders' Agent of any claim which Newell discovers or of which it
receives notice which might give rise to a claim against the Escrow
Property under Section 3.01 hereof (a "Claim"). Newell's right to
indemnification from the Escrow Property shall apply only to those
Claims of which Newell shall have given an Indemnification Notice to
the Escrow Agent and the Shareholders' Agent not later than the first
anniversary of the Effective Time. Any covenant, agreement,
representation or warranty which is the subject of a Claim shall
continue to survive until such claim is finally determined as herein
provided.
3.04 CLAIMS AGAINST THE SHAREHOLDERS. The Shareholders' Agent
shall have a period of 30 days from the date the Indemnification
Notice is given to provide written notice ("Object" or an "Objection")
to Newell and the Escrow Agent of an objection to the Claim identified
in the Indemnification Notice. Such Objection shall be to the merits
or the amount of the Claim or to both the merits and the amount of the
Claim. Newell and the Shareholders' Agent shall discuss any Claim as
to which the Shareholders' Agent objects and attempt to agree upon the
amount which is to be paid to Newell with respect to such Claim. If
and to the extent that Newell and the Shareholders' Agent agree that
Newell is entitled to be indemnified for Damages with respect to any
such Claim and the amount of such Damages, they shall give joint
written notice to the Escrow Agent to that effect (a "Joint Notice").
If Newell and the Shareholders' Agent have not agreed as to whether
-41-<PAGE>
Newell is entitled to indemnification for Damages with respect to any
such Claim and/or the amount of such Damages to which Newell is to be
paid with respect to any such Claim within 30 days (which period may
be extended upon the written agreement of Newell and the Shareholders'
Agent and notice thereof given to the Escrow Agent) after the date the
notice of Objection is given to Newell and the Escrow Agent, either
party may thereafter institute an appropriate proceeding with respect
to the matters which have not been agreed upon. Each of the parties
hereto agrees that a final non-appealable judgment in any such
proceeding brought in any such court shall be conclusive and binding
on such party.
3.05 THIRD PARTY CLAIMS. In the event the Indemnification Notice
relates to a Claim asserted against Newell by a third party, Newell
shall give notice to the Shareholders' Agent within ten (10) days of
its receipt of service of any suit or proceeding which may be the
subject of a claim. The Shareholders shall have the right to
undertake and control the defense of such Claim, provided that Newell
shall have the right to participate in any such defense at its own
expense. The Shareholders shall be required to seek the consent of
Newell to any payment, compromise or settlement of such Claim, which
consent shall not be unreasonably withheld; provided, that the
Shareholders shall not be required to seek the consent of Newell to
any payment, compromise or settlement the entire amount of which would
be paid by parties other than Newell.
3.06 PAYMENT OF CLAIMS. The Escrow Agent shall continue to hold
the Escrow Property pending the occurrence of any of the following:
(a) receipt by the Escrow Agent of a Joint Notice; (b) receipt by the
Escrow Agent of a true copy, certified by a court of competent
jurisdiction, of a final order, judgment or decree establishing
Newell's claim to indemnification. Upon receipt of either of the
foregoing, the Escrow Agent shall deliver to Newell such portion of
the Escrow Property (in accordance with the proportionate interests of
the Shareholders) as shall equal 49% of the amount of the Damages or
claim which is to be paid to Newell. For this purpose, the Escrow
Shares shall be valued at $24.175 per share.
3.07 LIMITATION OF INDEMNIFICATION. Newell's rights to
indemnification under this Agreement shall be limited to the Escrow
Property. No Shareholder shall have any obligation to contribute
additional cash or Newell stock to the Escrow Property or to indemnify
Newell for any amount in excess of the Escrow Shares or Escrow Cash,
as the case may be, contributed to the Escrow Property.
ARTICLE IV
Termination
4.01 TERMINATION DATE. The escrow created by this Agreement
shall terminate on the first anniversary of the Effective Time or, if
at that time a Claim or Claims made pursuant to Article III hereof is
or are pending, upon the final resolution of the last such Claim (the
"Termination Date").
4.02 DISTRIBUTION OF ESCROW PROPERTY. On the Termination Date,
any remaining Escrow Shares shall be distributed to Gaffney and any
-42-<PAGE>
remaining Escrow Cash shall be distributed to the other Shareholders
in accordance with their proportionate interests.
4.04 FRACTIONAL INTERESTS. No fractional share of Newell Common
Stock shall be distributed and the Escrow Agent is authorized and
directed to sell shares of Newell Common Stock in order to avoid
distribution of fractional interests and to deliver the cash
equivalent thereof.
ARTICLE V
The Escrow Agent
5.01 RIGHTS AND OBLIGATIONS. The Escrow Agent and any successor
escrow agent shall at all times be a bank organized under the laws of
the United States or any state having a reported capital and surplus
of not less than $5,000,000, or having assets under management of not
less than $100,000,000. The Escrow Agent (a) shall not be liable for
any error of judgment, any mistake of fact or law or any act done or
omitted by it in good faith, unless as the result of its gross
negligence of willful misconduct; (b) shall be entitled to treat as
genuine any letter or other document furnished to it by Newell,
Acquisition or the Shareholders' Agent and believed by it to be
genuine and to have been signed and presented by the proper party or
parties; and (c) shall be paid by Newell for its services at its
customary rates as in effect from time to time and its out-of-pocket
expenses (including but not limited to the reasonable attorneys' fees
and disbursements of its counsel); (d) shall be entitled to consult
with counsel of its own choosing with respect to any matter that
arises hereunder and shall not be liable for action taken or omitted
to be taken by it in good faith, and in accordance with the advice of
such counsel; (e) shall be entitled to resign and be discharged from
its duties hereunder by giving written notice of such resignation to
Newell and the Shareholders' Agent specifying a date not less than 30
business days following the date of such notice when such resignation
shall take effect, at which time the successor escrow agent selected
by Newell shall accept such appointment and the Escrow Property held
hereunder; and (f) shall be indemnified and held harmless by Newell
against any and all costs, expenses, damages and liabilities incurred
by it hereunder except for those incurred by it as a result of its own
willful misconduct or negligence.
ARTICLE VI
Miscellaneous
6.01 NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed to have been given (a) when
delivered in person, (b) one business day after deposit with a
nationally recognized overnight courier service, (c) two business days
after being deposited in the United States mail, postage prepaid,
first class, registered or certified mail, or (d) the business day on
which it is sent and received by facsimile, as follows:
-43-<PAGE>
If to the Escrow Agent:
Firstar Trust Company Attention: Yvonne Siira
615 East Michigan Street
Milwaukee, WI 53202
Telephone: (414) 287-3928
Facsimile: (414) 287-3904
If to Newell:
Newell Co. Attention: William T. Alldredge
29 East Stephenson Street
Freeport, Illinois 61032
Facsimile: (608) 365-8290
and
Richard H. Wolff, Associate General Counsel
Newell Co.
4000 Auburn Street
Rockford, Illinois 61125-7018
Facsimile: (815) 969-6106
If to the Shareholders' Agent:
Mr. Thomas F. Gaffney
2091 Ocean View Drive
Tierra Verde, Florida 33715
Facsimile: (813) 866-3052
With a copy to:
Rex E. Schlaybaugh, Jr., Esq.
Dykema Gossett PLLC
1577 North Woodward Avenue
Suite 300
Bloomfield Hills, Michigan 48304
Facsimile: (810) 540-0763
6.02 HEADINGS AND DEFINITIONS. The section and subsection
headings in this Agreement are inserted for convenience only and shall
not affect in any way the meaning or interpretation of this Agreement.
6.03 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware.
6.04 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
* * * * * * *
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
NEWELL CO.
B y :
_____________________________________
T i t l e :
___________________________________
"Escrow Shares" "Escrow Cash"
Shares Cash
Deposited Deposited
_________ _________
__________________________________________
6,348 N/A Thomas F. Gaffney
Address:
N/A $88,660
__________________________________________
James J. Prete
Address:
N/A $76,375
__________________________________________
Larry D. Adkisson
Address:
Attest: Firstar Trust Company, as Escrow Agent
_____________________ B y :
_____________________________________
T i t l e :
__________________________________
SIGNATURE PAGE TO ESCROW AGREEMENT BY AND AMONG
NEWELL CO., THOMAS F. GAFFNEY, JAMES J. PRETE,
LARRY D. ADKISSON AND FIRSTAR TRUST COMPANY, AS ESCROW AGENT
EXHIBIT 5
SCHIFF HARDIN & WAITE
7300 Sears Tower
Chicago, Illinois 60606
-----------------------
August 23, 1995
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, D.C. 20549-1004
Re: NEWELL CO.
REGISTRATION STATEMENT ON FORM S-3
Ladies and Gentlemen:
We are acting as counsel for Newell Co., a Delaware corporation
(the "Company"), in connection with the Company's filing of a
Registration Statement on Form S-3 (the "Registration Statement") with
the Securities and Exchange Commission covering the registration of
131,561 shares of common stock, par value $1.00 per share, of the
Company and the related Preferred Stock Purchase Rights attached
thereto (collectively the "Shares"), which are being offered for the
account of a certain selling stockholder of the Company.
In this connection we have examined such documents and have made
such factual and legal investigations as we have deemed necessary or
appropriate for the purpose of this opinion.
Based upon the foregoing, it is our opinion that the Shares have
been validly authorized and are legally issued, fully paid and non-
assessable. We draw to your attention, however, that the Wisconsin
Supreme Court has held that the provisions of a predecessor of Section
180.0622 of the Wisconsin Business Corporation Law relating to
shareholders' liability for employee wages are applicable to foreign
corporations qualified to do business in the State of Wisconsin, such
as the Company.
We hereby consent to the filing of this opinion as Exhibit 5 to
the Registration Statement and to the reference to us under the
caption "Legal Opinion" in the Registration Statement.
Very truly yours,
SCHIFF HARDIN & WAITE
By: /s/Linda J. Wight
----------------------------
Linda Jeffries Wight
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
------------------------------------------
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our
report dated January 28, 1995 included in Newell Co.'s Form 10-K for
the year ended December 31, 1994 and to all references to our Firm
included in this registration statement.
By: /s/Arthur Andersen LLP
------------------------------
-- ARTHUR ANDERSEN LLP
Milwaukee, Wisconsin
August 22, 1995
