FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported) June 30, 1994
Commission file number: 0-20416
EAGLE INDUSTRIES, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 13-3384361
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
Two North Riverside Plaza
Chicago, Illinois 60606
(Address of Principal Executive Offices)
(312) 906-8700
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last
report)
<PAGE>
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On June 30, 1994, an indirect wholly-owned subsidiary of Eagle Industries, Inc.
(the "Company") sold the stock of Pfaudler (United States), Inc. ("Pfaudler")
and Chemineer, Inc. ("Chemineer") to Robbins & Myers, Inc. pursuant to an
Amended and Restated Stock Purchase Agreement (the "Agreement") dated June 29,
1994.
Under the terms of the Agreement, total consideration received amounted to
$59.9 million in cash and a $50.0 million note. In addition, the Company
received stock appreciation rights with respect to 2,000,000 shares of the
common stock of Robbins & Myers, Inc. The cash proceeds received at closing
were primarily utilized by the Company and its subsidiaries to reduce
outstanding debt.
Pfaudler is a manufacturer of glass-lined steel storage and reactor vessels for
the chemical processing and pharmaceutical industries. Chemineer is a
manufacturer of mixing and agitation equipment for the process industries.
<PAGE>
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
A. Financial Statements
Not applicable
B. Pro Forma Financial Statements
It is not practicable to provide the required pro forma financial
information at the time of the filing of this report. The required pro
forma financial information will be filed within 45 days of the due date of
this Form 8-K, or by August 29, 1994.
C. Exhibits
2.1 Amended and Restated Stock Purchase Agreement among Eagle Industrial
Products Corporation and O.D.E. Manufacturing, Inc. and Robbins & Myers,
Inc.
2.2 SAR and Registration Rights Agreement between Robbins & Myers, Inc. and
Eagle Industrial Products Corporation.
2.3 Robbins & Myers, Inc. Senior Subordinated Extendible Reset Note
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
EAGLE INDUSTRIES, INC.
Dated: July 13, 1994 By: /s/ Sam A. Cottone
-------------------------
Sam A. Cottone
Senior Vice President and
Chief Financial Officer
Exhibit 2.1
AMENDED AND RESTATED STOCK PURCHASE AGREEMENT
Among
EAGLE INDUSTRIAL PRODUCTS CORPORATION
and
O.D.E. MANUFACTURING, INC.
AS "SELLERS"
and
ROBBINS & MYERS, INC.
AS "BUYER"
DATED AS OF JUNE 29, 1994
<PAGE>
TABLE OF CONTENTS
Page
Section 1 Definitions. . . . . . . . . . . . . . . . 1
1.01 Affiliate. . . . . . . . . . . . . . . . . 1
1.02 Chemical Agreements. . . . . . . . . . . . 1
1.03 Chemineer. . . . . . . . . . . . . . . . . 1
1.04 Chemineer Stock. . . . . . . . . . . . . . 1
1.05 Closing. . . . . . . . . . . . . . . . . . 1
1.06 Closing Adjustment . . . . . . . . . . . . 2
1.07 Closing Balance Sheet. . . . . . . . . . . 2
1.08 Closing Date . . . . . . . . . . . . . . . 2
1.09 Closing Statement. . . . . . . . . . . . . 2
1.10 Code . . . . . . . . . . . . . . . . . . . 2
1.11 Commission . . . . . . . . . . . . . . . . 2
1.12 Companies. . . . . . . . . . . . . . . . . 2
1.13 Contracts. . . . . . . . . . . . . . . . . 2
1.14 December Balance Sheet . . . . . . . . . . 3
1.15 Eagle. . . . . . . . . . . . . . . . . . . 3
1.16 Eagle Reports. . . . . . . . . . . . . . . 3
1.17 Effective Time . . . . . . . . . . . . . . 3
1.18 Employee Plans . . . . . . . . . . . . . . 3
1.19 Environmental Laws . . . . . . . . . . . . 4
1.20 ERISA. . . . . . . . . . . . . . . . . . . 4
1.21 ERISA Affiliate. . . . . . . . . . . . . . 4
1.22 Exhibit. . . . . . . . . . . . . . . . . . 4
1.23 Final Net Worth as Adjusted. . . . . . . . 4
1.24 Financial Statements . . . . . . . . . . . 4
1.25 Governmental Entity. . . . . . . . . . . . 5
1.26 Hazardous Substances . . . . . . . . . . . 5
1.27 HSR Act. . . . . . . . . . . . . . . . . . 5
1.28 India Company. . . . . . . . . . . . . . . 5
1.29 Intercompany . . . . . . . . . . . . . . . 5
1.30 Kennecott Agreement. . . . . . . . . . . . 5
1.31 Known to Sellers or to Sellers'
Knowledge. . . . . . . . . . . . . . . . . 5
1.32 Leased Real Property . . . . . . . . . . . 5
1.33 Material . . . . . . . . . . . . . . . . . 5
1.34 ODE. . . . . . . . . . . . . . . . . . . . 6
1.35 Owned Real Property. . . . . . . . . . . . 6
1.36 Permits. . . . . . . . . . . . . . . . . . 6
1.37 Proprietary Information. . . . . . . . . . 6
1.38 Pfaudler . . . . . . . . . . . . . . . . . 6
1.39 Pfaudler Stock . . . . . . . . . . . . . . 6
1.40 Purchase Price . . . . . . . . . . . . . . 6
1.41 R&M. . . . . . . . . . . . . . . . . . . . 6
1.42 R&M Debenture. . . . . . . . . . . . . . . 6
1.43 R&M Indenture. . . . . . . . . . . . . . . 6
1.44 Receivables Agreement. . . . . . . . . . . 6
1.45 Receivables Purchase Price . . . . . . . . 7
1.46 R&M Reports. . . . . . . . . . . . . . . . 7
1.47 Records. . . . . . . . . . . . . . . . . . 7
1.48 SAR. . . . . . . . . . . . . . . . . . . . 7
1.49 SAR Agreement. . . . . . . . . . . . . . . 7
1.50 Schedule . . . . . . . . . . . . . . . . . 7
1.51 Security Act . . . . . . . . . . . . . . . 7
1.52 Security Interest. . . . . . . . . . . . . 7
1.53 Sellers Group. . . . . . . . . . . . . . . 7
1.54 Senior Lenders . . . . . . . . . . . . . . 7
1.55 Stock. . . . . . . . . . . . . . . . . . . 7
1.56 Subsidiaries . . . . . . . . . . . . . . . 7
1.57 WCE Test Center. . . . . . . . . . . . . . 8
Section 2 Purchase and Sale of Stock . . . . . . . . 8
2.1 Purchase . . . . . . . . . . . . . . . . . 8
2.2 Purchase Price . . . . . . . . . . . . . . 8
2.3 Adjustment to Purchase Price . . . . . . . 8
2.4 Allocation of Purchase Price . . . . . . . 11
Section 3 Closing. . . . . . . . . . . . . . . . . . 11
Section 4 Representations and Warranties
of Sellers Regarding Sellers . . . . . . . 15
4.01 Title to, and Transfer of, Stock . . . . . 15
4.02 Organization; Good Standing; Qualification
and Net Worth. . . . . . . . . . . . . . . 15
4.03 Corporate Authority. . . . . . . . . . . . 15
4.04 No Violation . . . . . . . . . . . . . . . 16
4.05 Consents . . . . . . . . . . . . . . . . . 16
4.06 No Brokerage Fees. . . . . . . . . . . . . 16
4.07 Litigation . . . . . . . . . . . . . . . . 16
4.08 Investment Representations . . . . . . . . 17
Section 5 Representations and Warranties of
Sellers Regarding the Companies. . . . . . 17
5.01 Title to Capital Stock of Subsidiaries . . 17
5.02 Organization, Foreign Qualification and
Capitalization . . . . . . . . . . . . . . 17
5.03 Corporate Information Table. . . . . . . . 18
5.04 No Violation . . . . . . . . . . . . . . . 22
5.05 Title to Properties; Absence of
Liens, Etc.. . . . . . . . . . . . . . . . 22
5.06 Receivables. . . . . . . . . . . . . . . . 23
5.07 Financial Statements . . . . . . . . . . . 23
5.08 Litigation . . . . . . . . . . . . . . . . 23
5.09 Product Liability. . . . . . . . . . . . . 23
5.10 Contracts; Powers of Attorney. . . . . . . 24
5.11 Environmental Compliance . . . . . . . . . 24
5.12 Kennecott Agreement. . . . . . . . . . . . 25
5.13 Compliance with Laws and Orders. . . . . . 26
5.14 Permits and Licenses . . . . . . . . . . . 26
5.15 Employee Plans . . . . . . . . . . . . . . 26
5.16 Insurance. . . . . . . . . . . . . . . . . 29
5.17 Capital Projects . . . . . . . . . . . . . 29
5.18 Absence of Certain Changes, Event
or Conditions. . . . . . . . . . . . . . . 29
5.19 Labor Matters. . . . . . . . . . . . . . . 29
5.20 Proprietary Property . . . . . . . . . . . 29
5.21 Affiliates . . . . . . . . . . . . . . . . 30
5.22 Express Representations and
Warranties Only. . . . . . . . . . . . . . 30
5.23 Predecessor Affiliates . . . . . . . . . . 30
Section 6 Representations and Warranties of R&M. . . 30
6.01 Organization; Good Standing;
and Qualification. . . . . . . . . . . . . 30
6.02 Corporate Authority. . . . . . . . . . . . 30
6.03 No Violation . . . . . . . . . . . . . . . 31
6.04 Consents . . . . . . . . . . . . . . . . . 31
6.05 No Brokerage Fees. . . . . . . . . . . . . 31
6.06 Litigation . . . . . . . . . . . . . . . . 32
6.07 Capitalization . . . . . . . . . . . . . . 32
6.08 Financing. . . . . . . . . . . . . . . . . 32
Section 7 Arrangements as to Certain Employee
Plans. . . . . . . . . . . . . . . . . . . 32
Section 8 Taxes; Tax Returns; and Tax Indemnities. . 34
Section 9 Representations and Warranties of Eagle
Regarding the India Company. . . . . . . . 39
9.01 Capitalization and Title to Capital
Stock. . . . . . . . . . . . . . . . . . . 39
9.02 Organization . . . . . . . . . . . . . . . 39
Section 10 Certain Covenants of Sellers . . . . . . . 39
10.01 Interim Operations of the Companies. . . . 39
10.02 Access, Information and Confidentiality. . 41
10.03 Confidentiality. . . . . . . . . . . . . . 41
10.04 Stand-still Provisions . . . . . . . . . . 41
Section 11 Certain Covenants of R&M . . . . . . . . . 42
11.01 Personnel Required in Response to
Litigation . . . . . . . . . . . . . . . . 42
11.02 Confidentiality. . . . . . . . . . . . . . 42
11.03 Use of the Name "Eagle". . . . . . . . . . 42
Section 12 Certain Additional Agreements and
Covenants of Sellers and R&M . . . . . . . 43
12.01 HSR Act Filing . . . . . . . . . . . . . . 43
12.02 Consummation of Transactions . . . . . . . 43
12.03 Public Announcements . . . . . . . . . . . 43
12.04 Notice of Certain Events . . . . . . . . . 44
12.05 Items Received after Effective Time. . . . 45
12.06 Access to Records. . . . . . . . . . . . . 45
12.07 Further Assurances . . . . . . . . . . . . 45
12.08 Expenses; Sales and Other Transfer Taxes . 45
12.09 Outstanding Letters of Credit. . . . . . . 45
12.10 Repayment of Intercompany Debt . . . . . . 46
12.11 Consents . . . . . . . . . . . . . . . . . 46
12.12 WFE Test Center. . . . . . . . . . . . . . 47
12.13 Responsibility for Insurance Coverage. . . 47
12.14 Letters of Credit. . . . . . . . . . . . . 47
Section 13 Conditions to R&M's Obligations. . . . . . 48
13.01 Accuracy of Representations and
Warranties . . . . . . . . . . . . . . . . 48
13.02 Litigation . . . . . . . . . . . . . . . . 48
13.03 Consents and Approvals . . . . . . . . . . 48
13.04 Financing Commitments. . . . . . . . . . . 48
Section 14 Conditions to Sellers' Obligations . . . . 49
14.01 Accuracy of Representations and
Warranties . . . . . . . . . . . . . . . . 49
14.02 Litigation . . . . . . . . . . . . . . . . 49
14.03 Consents and Approvals . . . . . . . . . . 49
Section 15 Survival of Representations and
Warranties . . . . . . . . . . . . . . . . 49
Section 16 Indemnity. . . . . . . . . . . . . . . . . 50
Section 17 Termination, Amendment and Waiver. . . . . 56
17.01 Termination of Agreement . . . . . . . . . 57
17.02 Effect of Termination. . . . . . . . . . . 57
17.03 Amendment, Extension and Waiver. . . . . . 57
Section 18 Miscellaneous. . . . . . . . . . . . . . . 57
18.01 Assignment; No Third-Party Rights. . . . . 57
18.02 Entire Agreement . . . . . . . . . . . . . 57
18.03 Section and Other Headings; Number . . . . 57
18.04 Notices. . . . . . . . . . . . . . . . . . 58
18.05 Law Governing. . . . . . . . . . . . . . . 59
18.06 Counterparts . . . . . . . . . . . . . . . 59
18.07 Resolution of Disputes . . . . . . . . . . 59
<PAGE>
AMENDED AND RESTATED STOCK PURCHASE AGREEMENT
THIS AMENDED AND RESTATED AGREEMENT is made as of
June 29, 1994 among EAGLE INDUSTRIAL PRODUCTS CORPORATION, a
Delaware corporation ("Eagle"), and O.D.E. MANUFACTURING, INC., a
Delaware corporation ("ODE"), (each of Eagle and ODE being
individually, a "Seller," and collectively, the "Sellers"), and
ROBBINS AND MYERS, INC., an Ohio corporation ("R&M"), under the
following circumstances:
A. Eagle owns all of the issued and outstanding
Pfaudler Stock; and ODE, a direct subsidiary of Eagle,
owns all of the issued and outstanding Chemineer Stock;
B. Eagle desires to sell, and R&M desires to
purchase, the Pfaudler Stock upon the terms and
conditions hereinafter set forth;
C. ODE desires to sell, and R&M desires to
purchase, the Chemineer Stock upon the terms and
conditions hereinafter set forth; and
D. This Amended and Restated Stock Purchase
Agreement amends and restates in its entirety the Stock
Purchase Agreement among Sellers and R&M dated May 26,
1994 and such May 26, 1994 agreement shall be of no
further force and effect;
NOW, THEREFORE, Sellers and R&M agree as follows:
Section 1. Definitions. For the purpose of this
Agreement, any amendments hereto and any Exhibit attached hereto
or Schedule described herein, and in addition to terms defined
elsewhere herein, the following terms shall have the following
meanings, except as otherwise expressly provided or unless the
context otherwise requires:
1.01 "Affiliate" of a named party means any entity in
control of, controlled by, or under common control with such
named party.
1.02 "Chemical Agreements" means all of the agreements
entered into by Eagle or Affiliates of Eagle in connection with
the $425,000,000 credit refinancing, effective January 31, 1994,
as to which Chemical Bank serves as agent.
1.03 "Chemineer" means Chemineer, Inc., a Delaware
corporation.
1.04 "Chemineer Stock" means all of the issued and
outstanding capital stock of Chemineer.
1.05 "Closing" means the closing for which provision is
made in Section 3.
1.06 "Closing Adjustment" shall have the meaning
ascribed to it in Section 2.3(f).
1.07 "Closing Balance Sheet" means the balance sheet of
the Companies immediately prior to the Effective Time, as more
particularly described at Section 2.3(a); "Closing Balance Sheet
Date" means the Closing Date.
1.08 "Closing Date" means the date of the Closing.
1.09 "Closing Statement" shall have the meaning
ascribed to it at Section 2.3(a) and shall be prepared in
accordance with the Closing Statement format in Schedule 1.09.
1.10 "Code" means the Internal Revenue Code of 1986, as
amended.
1.11 "Commission" means the Securities and Exchange
Commission.
1.12 "Companies" means and includes Chemineer,
Pfaudler, and the Subsidiaries; "Domestic Company" means any or
all of the Companies incorporated in a jurisdiction within the
United States, as the context may require; and "Foreign Company"
means any or all of the Companies incorporated outside the United
States, as the context may require.
1.13 "Contracts" mean and include all of the following
which any of the Companies is a party to, is bound by, or by
which any property or assets of any of them may be bound: (i)
all real property leases; (ii) all leases of tangible personal
property having rentals in excess of $50,000 due over the
remaining term of the lease; (iii) all franchise, dealer, or
other distribution agreements pursuant to which any of the
Companies sells or otherwise distributes its products or services
or pursuant to which any person sells or otherwise distributes
products or services of any of the Companies; (iv) all supply
contracts or other such agreements or understandings pursuant to
which any of the Companies purchased in 1993, or expects to
purchase in 1994, in excess of $250,000 in products or services;
(v) any contract, purchase order, commitment, or understanding
involving the sale of products and services of any of the
Companies pursuant to which a customer is expected to pay any of
the Companies in excess of $250,000 in the next 12-month period;
(vi) any agreement involving the licensing of Proprietary
Information or the payment of royalties; (vii) any agreement,
arrangement, or commitment which materially restricts the conduct
of any line of business or which imposes a confidentiality
obligation upon any of the Companies; (viii) any agreement with
or benefiting any director or officer of any of the Companies, or
with or benefiting any Affiliate of Eagle and which provides for
aggregate payments in any calendar year in excess of $60,000,
exclusive of salary and payments under Employee Plans; (ix) any
agreement, indenture or other instrument relating to the
borrowing of money by any of the Companies (other than the debt
under the Chemical Agreements and trade payables and instruments
relating to transactions entered into in the ordinary course of
business); (x) any agreement pursuant to which any of the
Companies is obligated to lend money or make advances to any
person (other than routine advances to any employee not to exceed
$5,000, deposits or advances in respect of products purchased in
the ordinary course of business, and advances made to an employee
in connection with the relocation of such employee by any of the
Companies); (xi) any agreement, arrangement or commitment to
guarantee the obligations of or to indemnify or exonerate from
liability any person, including, without limitation, any of the
Subsidiaries and the directors or officers of any of the
Companies (other than pursuant to applicable law or the
Certificate of Incorporation or By-laws of any of the Companies);
(xii) any Tax allocation or Tax sharing agreement; (xiii) any
agreement or arrangement relating to the voting or disposition of
any securities of any of the Companies; (xiv) any other contract,
commitment, agreement, or understanding, whether written or oral,
which involves more than $500,000 and is not terminable without
penalty upon not more than 31 days' notice; and (xv) any
partnership, joint venture, or other agreement pursuant to which
any of the Companies holds an equity interest in any person or
entity.
1.14 "December Balance Sheet" means the audited
consolidated balance sheet of the Companies at December 31, 1993
which is included in the Financial Statements.
1.15 "Eagle" means Eagle Industrial Products
Corporation, a Delaware corporation.
1.16 "Eagle Reports" means all reports, registrations,
and statements, together with any amendments thereto, filed by
Eagle Industries, Inc. with the Commission since September 1,
1992, including but not limited to, Forms 10-K, Forms 10-Q, and
Forms 8-K.
1.17 "Effective Time" means 11:59 p.m. on the Closing
Date.
1.18 "Employee Plans" means all employment, bonus,
deferred compensation, pension, retirement, profit sharing, stock
option, stock purchase, employee stock ownership, stock
appreciation rights, savings, severance, termination, collective
bargaining, group insurance, fringe benefit and other employee
benefit, incentive and welfare plans, policies, contracts and
arrangements, formal or informal, written or oral, and all trust
agreements related thereto, relating to any present or former
directors, officers or employees of any of the Companies;
"Domestic Employee Plans" means Employee Plans maintained by any
one of the Companies other than a Subsidiary which is
incorporated outside of the United States; and "Foreign Employee
Plans" means Employee Plans maintained by a Subsidiary which is
incorporated outside of the United States.
1.19 "Environmental Laws" shall mean any foreign,
federal, state or local law, statute, ordinance, rule, regulation
or code, and any license, permit, authorization, approval,
consent, order, judgment, decree, injunction or agreement with
any Governmental Entity to which a Company or any property owned,
leased, occupied or used by a Company is a party or subject,
related to (i) the protection, preservation or restoration of the
environment (including, without limitation, air, water vapor,
surface water, ground water, drinking water supply, surface soil,
subsurface soil, plant and animal life or any other natural
resource), and/or (ii) the use, storage, recycling, treatment,
generation, transportation, processing, handling, labeling,
production, release or disposal of Hazardous Substances. The
term Environmental Law includes, without limitation: the
Comprehensive Environmental Response, Compensation and Liability
Act, as amended, 42 U.S.C. section 9601, et seq.; the Resource
Conservation and Recovery Act, as amended, 42 U.S.C. section 6901, et
seq.; the Clean Air Act, as amended, 42 U.S.C. section 7401, et seq.;
the Federal Water Pollution Control Act, as amended, 33 U.S.C.
section 1251, et seq.; the Toxic Substances Control Act, as amended,
125 U.S.C. section 9601, et seq.; the Emergency Planning and Community
Right to Know Act, 42 U.S.C. section 11001, et seq.; the Safe Drinking
Water Act, 42 U.S.C. section 300f, et seq.; all comparable state and
local laws; and any common law (including without limitation,
common law that may impose strict liability) that may impose
liability or obligations for injuries or damages due to, or
threatened as a result of, the presence of or exposure to any
Hazardous Substance.
1.20 "ERISA" means the Employee Retirement Income
Security Act of 1974, as amended.
1.21 "ERISA Affiliate" means, as applied to any person,
(i) any corporation which is a member of a controlled group of
corporations within the meaning of Section 414(b) of the Code of
which that person is a member, (ii) any trade or business
(whether or not incorporated) which is a member of a group of
trades or business under common control within the meaning of
Section 414(c) of the Code of which that person is a trade
member, and (iii) any member of an affiliated service group
within the meaning of Section 414(m) or (o) of the Code of which
that person, any corporation described in clause (i) above or any
trade or business described in clause (ii) above is a member.
1.22 "Exhibit" means any of the exhibits attached to
and made a part of this Agreement.
1.23 "Final Net Worth as Adjusted" shall have the
meaning ascribed to it at Section 2.2(b).
1.24 "Financial Statements" shall have the meaning
ascribed to it at Section 5.07.
1.25 "Governmental Entity" means any court,
governmental authority or other regulatory or administrative
agency or commission, domestic or foreign.
1.26 "Hazardous Substances" shall mean any material
presently listed, defined, designated or classified as hazardous,
toxic, radioactive, under any Environmental Laws, whether by type
or by quantity, and petroleum or any derivative or by-product
thereof.
1.27 "HSR Act" shall mean the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended.
1.28 "India Company" means Gujarat Machinery
Manufacturers Limited, a company incorporated under the laws of
India.
1.29 "Intercompany" means, with respect to any
transaction, obligation, agreement or account, a transaction,
obligation, agreement or account between any one of the Companies
and a Seller or any of its Affiliates (other than one of the
Companies).
1.30 "Kennecott Agreement" means the agreement among
Kennecott Mining Corporation and Pfaudler-Balfour Limited, as
sellers, and Great American Industrial Group, Inc. and Legibus
855, Limited, as buyers, dated March 13, 1987.
1.31 "Known to Sellers" or "to Sellers' Knowledge"
means any information known (such knowledge to be actual and not
imputed) to any officer or director of Eagle, ODE, or to any of
the persons listed at Exhibit B.
1.32 "Leased Real Property" means the land, building,
structures, or other real property listed at Schedule 1.32 as
currently being leased by any of the Companies.
1.33 "Material" when used herein to limit a
representation or warranty of a party shall be interpreted as
follows:
(i) whenever any representation or warranty of a
Seller or the Sellers, collectively, contains an
exception or limitation relating to "materiality,"
"material adverse" events or omissions, "material
adverse effects" or similar concepts (collectively,
"Materiality Tests"), such Materiality Tests shall be
deemed to have been met (i.e., such events or omissions
shall be deemed to be "material," "materially adverse,"
have a "material adverse effect" or otherwise meet a
similar test), and such representation or warranty shall
be deemed to have been breached, if such breach results
in an adverse impact with respect to the Companies'
assets of $100,000 or an adverse impact with respect to
the Companies' consolidated earnings of $100,000; and
(ii) whenever any representation or warranty of R&M
contains a Materiality Test, such representation or
warranty shall be deemed to have been breached, if such
breach results in an adverse impact with respect to
Sellers' assets of $100,000 or an adverse impact with
respect to Sellers' earnings of $100,000.
1.34 "ODE" means O.D.E. Manufacturing, Inc., a Delaware
corporation.
1.35 "Owned Real Property" means the land, buildings,
structures, fixtures, and other improvements located at the
premises listed at Schedule 1.31 as currently being owned by any
of the Companies.
1.36 "Permits" means foreign, federal, state, local and
other governmental licenses, permits, approvals and
authorizations which relate to, or are necessary to conduct the
Business.
1.37 "Proprietary Information" means all rights of any
of the Companies under any patent, trademark, service mark, trade
name or copyright (or registrations or applications therefor) and
all other intellectual property rights, inventions, know-how,
confidential business information, data and documents, trade
secrets or proprietary information, drawings processes and
formulae used in the Business.
1.38 "Pfaudler" means Pfaudler (United States), Inc., a
Delaware corporation incorporated on January 31, 1994.
1.39 "Pfaudler Stock" means all of the issued and
outstanding capital stock of Pfaudler.
1.40 "Purchase Price" shall have the meaning ascribed
to it at Section 2.2.
1.41 "R&M" means Robbins & Myers, Inc., an Ohio
corporation. "R&M Group" shall have the meaning ascribed to it
in Section 16(a).
1.42 "R&M Debenture" means the $50,000,000 in
debentures of R&M to be delivered to Eagle at the Closing, a copy
of which is attached hereto as Exhibit A.
1.43 "R&M Indenture" means the indenture pursuant to
which the R&M Debenture is to be issued, a copy of which is
attached hereto as Exhibit A.
1.44 "Receivables Agreement" means the Receivables Sale
Agreement to be entered into between R&M and Continental Bank,
National Association, as Trustee, and to be attached hereto as
Schedule 1.44.
1.45 "Receivables Purchase Price" means an amount equal
to the receivables purchase price payable to Continental Bank,
National Association, as Trustee, pursuant to the Receivables
Agreement.
1.46 "R&M Reports" means all reports, registrations, and
statements, together with any amendments thereto, filed by R&M
with the Commission since September 1, 1992, including but not
limited to, Forms 10-K, Forms 10-Q, Forms 8-K, and proxy
statements.
1.47 "Records" means, in the case of each Company, all
books and records of the Company including, without limitation,
its tax returns, minute books, stock records, general ledger, all
property and equipment records, production records, engineering
records, purchasing and sales records, personnel and payroll
records, accounting records, magnetic copies of computer files
and documentation, customer and vendor lists, and other records
and files of the Company kept in the ordinary course of its
business and in the possession of any of the Sellers, the
Companies, or Affiliates of the Sellers.
1.48 "SAR" means a stock appreciation right granted
pursuant to the SAR Agreement.
1.49 "SAR Agreement" means the SAR and Registration
Rights Agreement in the form attached hereto as Exhibit C
1.50 "Schedule" means any of the Schedules listed in
the Table of Contents to this Agreement.
1.51 "Securities Act" means the Securities Act of 1933,
as amended.
1.52 "Security Interest" means any pledge, security
interest, lien, charge, encumbrance, option, or restriction on
transfer.
1.53 "Seller Group" shall have the meaning ascribed to
it in Section 16(b).
1.54 "Senior Lenders" means Bank One, Dayton, NA and
National City Bank, Columbus, which have committed to loan R&M an
aggregate of $75,000,000 under Loan Commitment Letters dated
April 22, 1994.
1.55 "Stock" means the Pfaudler Stock and the Chemineer
Stock.
1.56 "Subsidiaries" means and includes each of the
corporations listed below:
(a) Chemineer, Limited, a corporation incorporated
under the laws of England and a subsidiary of Chemineer
("Chemineer U.K.");
(b) Edlon Products Inc., a Delaware corporation and a
subsidiary of Pfaudler ("Edlon");
(c) Pfaudler-Werke GMBH, a corporation incorporated
under the laws of Germany ("Pfaudler Germany"); Pfaudler
Balfour Holdings, Limited, a corporation incorporated under
the laws of England ("Pfaudler Holdings U.K."); Pfaudler
Balfour Limited, a corporation incorporated under the laws
of England and a subsidiary of Pfaudler Holdings U.K.
("Pfaudler U.K."); Chemical Reactor Services, Limited, a
corporation incorporated under the laws of England and a
subsidiary of Pfaudler Holdings U.K. ("Pfaudler CRS U.K.");
Stoline, Limited, a corporation incorporated under the laws
of Scotland and a subsidiary of Pfaudler Holdings U.K.
("Pfaudler Stoline U.K.); Pfaudler Development Corporation,
a corporation incorporated under the laws of Panama
("Pfaudler Panama"); Pfaudler S.A. de C.V., a corporation
incorporated under the laws of Mexico and a subsidiary of
Pfaudler Panama ("Pfaudler Mexico"); Pfaudler Equipamentos
Industriais, LTDA, a corporation incorporated under the laws
of Brazil ("Pfaudler Brazil"); and Torin Aerotecnica, LTDA,
a corporation incorporated under the laws of Brazil and a
subsidiary of Pfaudler Brazil ("Pfaudler Torin") (each of
the foregoing is a direct or indirect subsidiary of Pfaudler
and are collectively referred to hereinafter as "Pfaudler
Foreign Subsidiaries");
1.57 "WFE Test Center" means the WFE Test Center,
Henrietta, New York.
Section 2. Purchase and Sale of Stock.
2.1 Purchase. Subject to the terms and conditions of
this Agreement, Sellers shall sell, convey, assign, transfer and
deliver the Pfaudler Stock and the Chemineer Stock, free and
clear of any Security Interest, to R&M; and R&M shall purchase
and acquire from Sellers, the Pfaudler Stock and the Chemineer
Stock at the Closing.
2.2 Purchase Price. The purchase price for the Stock
to be paid by R&M to Eagle at the Closing shall be the sum of (a)
One Hundred Twenty-Four Million Dollars ($124,000,000 U.S.) less
the Receivables Purchase Price plus (b) a contingent amount
determined by reference to the value of R&M common shares (in
accordance with the SAR Agreement) as evidenced by 2,000,000 SARs
(collectively the "Purchase Price"), subject to possible
adjustment as provided in Section 2.3.
2.3 Adjustment to Purchase Price. The Purchase Price
shall be subject to adjustment as provided in this Section 2.3.
(a) Preparation of the Closing Balance Sheet and the
Closing Statement. Within 60 days after the Effective Time,
Eagle shall deliver to R&M a consolidated balance sheet of the
Companies immediately prior to the Effective Time (the "Closing
Balance Sheet") and the Closing Balance Sheet as adjusted in
accordance with Schedule 1.09 (the "Closing Statement") showing
Eagle's calculation of the Closing Adjustment in accordance with
the provisions of Section 2.3(f). The excess of the assets over
the liabilities of the Companies immediately prior to the
Effective Time as shown on the Closing Statement shall be the
"Final Net Worth as Adjusted." The Closing Balance Sheet shall
be prepared by Eagle on the basis of historical costs in
accordance with generally accepted accounting principles
consistently applied on a going-concern basis in accordance with
the standard practices of the Companies used to prepare the
December 31, 1993 financial statements. Arthur Andersen & Co.
shall examine the Closing Balance Sheet in accordance with
generally-accepted auditing standards; shall provide an opinion
that the Closing Balance Sheet presents fairly, in all material
respects, the financial condition of the Companies on a
consolidated basis immediately prior to the Effective Time; and
shall review Eagle's calculation of the Closing Adjustment to
determine that it is consistent with the provisions of this
Agreement.
(b) Closing Balance Sheet. The Closing Balance Sheet
to be prepared in accordance with Section 2.3(a) shall separately
reflect those assets and liabilities necessary to determine the
Closing Adjustment. Eagle and R&M agree that the "Net Worth As
Adjusted at September 30, 1993" was $60,351,000.
(c) Scope of Audit and Observation of Inventory. The
audit plan and scope of audit of the Companies shall be prepared
by Arthur Andersen & Co. and shall be reviewed by R&M and Eagle
and their representatives prior to the Closing. Ernst & Young
and other representatives of R&M shall be entitled to observe the
taking of the inventory in connection with the preparation of the
Closing Balance Sheet and to observe such other activities
related to the preparation of the Closing Balance Sheet as they
may reasonably request.
(d) Access to Books and Records. After the Closing,
R&M shall permit Eagle, Arthur Andersen & Co., and their
respective representatives, during normal business hours, to have
reasonable access to and to examine and make copies of any books
and records of R&M or any of its Affiliates which are reasonably
required for purposes of preparing the Closing Balance Sheet and
Closing Statement. After the Closing, Eagle shall permit R&M,
Ernst & Young, and their representatives, during normal business
hours, to have reasonable access to, and to examine and make
copies of, the books and records of Eagle, the Companies, any
Affiliate of Eagle, or Arthur Andersen & Co. which are in the
possession of any of them and are necessary for R&M and its
representatives to review the Closing Balance Sheet and Closing
Statement.
(e) Objections to the Closing Balance Sheet or
Calculation of Closing Adjustment. R&M may object to any of the
information contained in the Closing Balance Sheet and the
Closing Statement which could affect the Closing Adjustment to be
made pursuant to Section 2.3(f) if such objection is based on a
claim that the Closing Balance Sheet was not prepared in
accordance with Section 2.3(a) and may object to the Closing
Adjustment shown on the Closing Statement if such objection is
based on the claim that the Closing Statement or the calculation
of the Closing Adjustment is inconsistent with the provisions of
this Agreement. Any such objection must be made by delivery of a
written statement of objections (stating the basis of the
objections with reasonable specificity) to Eagle within 20 days
following delivery of the Closing Balance Sheet, together with
the Closing Statement and Arthur Andersen & Co.'s statement as to
the consistency of the Closing Adjustment as shown on the Closing
Statement with the provisions of this Agreement. If R&M does not
so object to the Closing Balance Sheet or the Closing Adjustment
within such 20-day period, the Closing Balance Sheet and the
Closing Adjustment as shown on the Closing Statement shall be
considered final and binding upon the parties.
In the event R&M and Eagle are unable to resolve a
dispute or disagreement set forth in a written objection pursuant
to this Section 2.3(e), either party may elect, by written notice
to the other party (given within 20 days after Eagle's receipt of
R&M's objections), to have all such disputes or disagreements
resolved by an accounting firm of recognized national standing
acceptable to Eagle and R&M and not then employed by either Eagle
or R&M (the "Selected Accounting Firm"). If R&M and Eagle cannot
agree upon the accounting firm to serve as the Selected
Accounting Firm, then Price Waterhouse & Co. (through its New
York City office) shall serve as the Selected Accounting Firm.
The Selected Accounting Firm shall make a final and binding
resolution of the disputes or disagreements in accordance with
the provisions of this Agreement and the Closing Balance Sheet
and calculation of the Closing Adjustment as shown on the Closing
Statement as finally determined by the Selected Accounting Firm
shall be deemed acceptable to R&M and Eagle for all purposes of
this Agreement. The Selected Accounting Firm shall be instructed
to use every reasonable effort to perform its services within 30
days after submission of the Closing Balance Sheet to it and, in
any case, as soon as practicable after such submission. The
costs and expenses for the services of the Selected Accounting
firm shall be borne by R&M and Eagle in proportion to the extent
to which the Selected Accounting Firm accepts the respective
positions of R&M and Eagle. For example, if Eagle asserts that
the Closing Adjustment should be $10,000 and R&M asserts that no
Closing Adjustment is warranted, and the Selected Accounting Firm
determines that the Closing Adjustment is $4,000, Eagle is
responsible for 60% and R&M is responsible for 40% of the costs
of the Selected Accounting Firm.
(f) Calculation and Payment of Closing Adjustment.
The amount of the Closing Adjustment, if any, shall be
determined as follows:
(i) if the difference between the Final Net Worth as
Adjusted and $60,351,000 is $100,000 or less, then no Closing
Adjustment shall be payable;
(ii) if the Final Net Worth as Adjusted exceeds
$60,451,000, then the Closing Adjustment shall be an amount
equal to the excess of the Final Net Worth as Adjusted over
$60,351,000 and shall be paid by R&M to Eagle in cash within
five days after the Closing Adjustment is finally determined.
(iii) if the Final Net Worth as Adjusted is less than
$60,251,000, then the Closing Adjustment shall be an amount
equal to the difference between the Final Net Worth as
Adjusted and $60,351,000 and shall be paid to R&M in cash by
Eagle within five days after the Closing Adjustment is
finally determined.
(g) Form of Payment. Payment of the Closing
Adjustment, if any, shall be made by wire transfer of immediately
available federal funds, together with interest thereon at the
prime rate of Continental Bank N.A. ("Prime Rate") plus one
percent (1%) per annum from the Closing Date until the date of
payment. If such adjustment (including the interest component,
if any,) is not paid within five (5) business days after final
determination of the Closing Adjustment, then such payment shall
accrue interest at the Prime Rate plus three percent (3%) from
the Closing Date until the date of actual payment.
2.4 Allocation of Purchase Price. Sellers and R&M
agree that the Purchase Price of the Stock (other than the value
of the 2,000,000 SARs), the Receivables Purchase Price, and the
book value of the liabilities of the Companies as shown on the
Closing Statement shall be allocated among the assets of the
Companies in the manner indicated on Exhibit D and that Sellers
and R&M shall each act in a manner consistent with such
allocation in filing Department of Treasury Form 8594, captioned
"Asset Acquisition Statement under Section 1060." When and to
the extent the SARs are exercised, the value received by the
holder of the SAR shall be allocated in accordance with
Exhibit D.
Section 3. Closing.
(a) The Closing under this Agreement shall take place
at the offices of Thompson, Hine and Flory, 2000 Courthouse
Plaza, NE, 10 West Second Street, Dayton, Ohio 45402, at 10:00
a.m., local time, on the later of 30 days after the date this
Agreement was entered into and, subject to the terms of Section
17.01(e), the third business day after all waiting periods under
the HSR Act have expired or been terminated, or at such other
place, date, or time as the parties may agree.
(b) At the Closing, Sellers shall, subject to the
fulfillment to their reasonable satisfaction of the conditions
set forth in Section 14 or its waiver thereof, deliver to R&M:
(i) a certificate or certificates representing the
Pfaudler Stock, registered in the name of Eagle, duly
endorsed by Eagle for transfer or accompanied by an
assignment of the Pfaudler Stock duly executed by Eagle
and with any requisite tax transfer stamps or other
documents attached, with each certificate being free and
clear of any Security Interest;
(ii) a certificate or certificates representing the
Chemineer Stock, registered in the name of ODE, duly
endorsed by ODE for transfer or accompanied by an
assignment of the Chemineer Stock duly executed by ODE
and with any requisite tax transfer stamps or other
documents attached, with each certificate being free and
clear of any Security Interest;
(iii) the Noncompetition Agreement in the form
attached hereto as Exhibit E, dated the Closing Date and
duly executed by an authorized officer of Eagle
Industries, Inc.;
(iv) a certificate of each Seller, dated the
Closing Date and executed by a duly authorized officer
of each Seller, certifying that the conditions set forth
in Section 13 have been satisfied;
(v) an opinion, dated the Closing Date, of
Rosenberg & Liebentritt, P.C., counsel to Sellers,
substantially in the form attached hereto as Exhibit F;
(vi) copies of resolutions of the Board of
Directors and shareholders of Eagle and ODE authorizing,
respectively, the sale of the Pfaudler Stock and the
Chemineer Stock pursuant to this Agreement and copies of
all resolutions of each Seller's Board of Directors
authorizing this Agreement, the transactions
contemplated hereby or otherwise relating to this
Agreement and the transactions contemplated hereby,
certified by the Secretary (or an Assistant Secretary)
of Eagle and ODE as being in full force and effect on
the Closing Date;
(vii) stock certificates representing all of the
outstanding capital stock of each of the Subsidiaries,
registered in the name of one of the Companies, with
each certificate being free and clear of any Security
Interest;
(viii) except as otherwise directed by R&M,
resignations of each director and officer of each of the
Companies, effective as of the Effective Time, and such
transfer documents as R&M may reasonably request to
substitute an R&M designee as the registered holder of
any capital shares of a Foreign Company held by an
Affiliate or designee of Eagle;
(ix) a certificate of the Secretary or Assistant
Secretary of each of the Companies certifying as to the
particular Company in which such person serves as such
officer (i) a true copy of the Certificate of
Incorporation of the Company and all amendments thereto,
with original certification by the Secretary of State or
other appropriate agencies in the state or jurisdiction
of incorporation of the Company and (ii) a true copy of
the Bylaws (or similar document) of the Company as in
effect on the Closing Date;
(x) certificates of good standing, dated no
earlier than 20 days prior to the Closing Date, with
respect to Eagle, ODE, and each of the Companies from
the respective Secretaries of State or other appropriate
agencies of each of the jurisdictions in which any of
such corporations is incorporated;
(xi) certificates of good standing, dated no
earlier than 20 days prior to the Closing Date, with
respect to each of the Companies from the respective
Secretaries of State or other appropriate agencies of
each of the jurisdictions in which each of the
respective Companies is qualified to do business as set
forth at Section 5.03;
(xii) copies of all third-party consents and
approvals required by Section 4.05 of this Agreement;
(xiii) all minute books and stock transfer records of
each of the Companies; and
(xiv) the R&M Indenture, dated the Closing Date;
(xv) SAR Agreement substantially in the form
attached hereto as Exhibit A, dated the Closing Date and
duly executed by an authorized officer of Eagle;
(xvi) The consent of Sellers to R&M's collateral
assignment of this Agreement to the Senior Lenders in
the event R&M defaults in a payment obligation under the
debt instruments held by the Senior Lenders; and
(xvii) such other documents and instruments as are
required to be delivered to R&M by Sellers pursuant to
this Agreement at or prior to the Closing.
(c) At the Closing, R&M shall, subject to the
fulfillment to its reasonable satisfaction of the conditions set
forth in Section 13 or its waiver thereof, deliver to Sellers the
following:
(i) an amount equal to $74,000,000 less the
Receivables Purchase Price, payable in cash by wire
transfer of immediately available funds to such bank
account as Eagle may specify in writing to R&M three
days prior to the Closing Date;
(ii) the R&M Debenture, in the principal amount of
$50,000,000, dated the Closing Date and duly executed by
an authorized officer of R&M;
(iii) the R&M Indenture, dated the Closing Date and
duly executed by an authorized officer of R&M;
(iv) Certificate evidencing 2,000,000 SARs,
registered in the name of Eagle, dated the Closing Date
and executed by a duly authorized officer of R&M;
(v) SAR Agreement substantially in the form
attached hereto as Exhibit A, dated the Closing Date and
executed by a duly authorized officer of R&M;
(vi) a certificate, dated the Closing Date and
executed by a duly authorized officer of R&M, certifying
that the conditions set forth in Section 14 have been
satisfied;
(vii) an opinion, dated the Closing Date, of
Thompson, Hine and Flory, counsel for R&M, substantially
in the form attached hereto as Exhibit G;
(viii) copies of all resolutions of R&M's Board of
Directors authorizing the transactions contemplated
hereby or otherwise relating to this Agreement and the
transactions contemplated hereby, certified by the
Secretary (or an Assistant Secretary) of R&M as being in
full force and effect on the Closing Date;
(ix) the Noncompetition Agreement attached hereto
as Exhibit E, dated the Closing Date and executed by a
duly authorized officer of R&M;
(x) sales tax exemption certificates, if
applicable, with respect to tangible personal property
included among the assets of the Companies;
(xi) certificates of good standings, dated no
earlier than 20 days prior to the Closing Date, that R&M
is duly incorporated and in good standing in the State
of Ohio; and
(xii) such other documents and instruments as are
required to be delivered to Sellers by R&M pursuant to
this Agreement at or prior to the Closing.
(d) At the Closing, the following additional actions
shall be taken provided the actions contemplated by Section 3(b)
and (c) are concurrently taken:
(i) R&M shall pay the Receivables Purchase Price
to Continental Bank, National Association, as Trustee,
as contemplated in the Receivables Sale Agreement; and
(ii) To the extent not previously done by Eagle
within the week prior to the Closing, Eagle shall cause
Falcon Manufacturing, Inc. ("Falcon") to pay to Pfaudler
Germany the DM 15,000,000 indebtedness of Falcon to
Pfaudler Germany under the loan agreement between Falcon
and Pfaudler Germany dated July 15, 1993 (the "German
Loan Agreement"), together with accrued but unpaid
interest through the Effective Time.
Section 4. Representations and Warranties of Sellers
Regarding Sellers. Each of the Sellers jointly and severally,
represent and warrant the following to R&M as of the date of this
Agreement:
4.01 Title to, and Transfer of, Stock. Except as set
forth on Schedule 4.01, Eagle has good title to the Pfaudler
Stock, and ODE has good title to the Chemineer Stock, in each
case, free and clear of any and all Security Interests. Eagle has
the full legal right, power and authority to transfer, convey,
and sell to R&M at the Closing the Pfaudler Stock, and upon
delivery of a certificate or certificates representing the
Pfaudler Stock at the Closing as contemplated herein, Eagle will
transfer to R&M good and valid title to the Pfaudler Stock, free
and clear of any and all Security Interests, including any listed
on Schedule 4.01, other than Security Interests created by R&M.
ODE has the full legal right, power and authority to transfer,
convey, and sell to R&M at the Closing the Chemineer Stock, and
upon delivery of a certificate or certificates representing the
Chemineer Stock at the Closing as contemplated herein, ODE will
transfer to R&M good and valid title to the Chemineer Stock, free
and clear of any and all Security Interests, including any listed
on Schedule 4.01 other than Security Interests created by R&M.
4.02 Organization; Good Standing; Qualification; and
Net Worth. Each Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware, with the corporate power and authority to conduct its
business and to own and lease its properties and assets. Eagle
has, and will have at the Effective Time, a net worth on a
consolidated basis of not less than $250,000,000.
4.03 Corporate Authority. Each Seller has the
corporate power and authority to execute, deliver and carry out
the terms of this Agreement and the other agreements and
instruments to be executed and delivered by it in connection with
the transactions contemplated hereby and thereby and has taken
all necessary corporate action, including approval by the
shareholders of each of the Sellers, to authorize the execution
and delivery of this Agreement and such other agreements and
instruments and the consummation of the transactions contemplated
hereby and thereby. This Agreement is, and the other agreements
and instruments to be executed and delivered by Sellers in
connection with the transactions contemplated hereby and thereby
will be, the legal, valid and binding obligations of each Seller
executing the same, enforceable in accordance with their terms,
except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other laws
relating to or from time to time affecting the enforcement of
creditors' rights generally and except that the enforceability of
each Seller's obligations is subject to general principles of
equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law).
4.04 No Violation. Neither the execution and delivery
of this Agreement or the other documents and instruments to be
executed and delivered by Sellers pursuant hereto, nor the
consummation by Sellers of the transactions contemplated hereby
or thereby (i) will violate any provision of the Certificate of
Incorporation or Bylaws of either Seller, (ii) will violate or be
in conflict with any applicable law or any applicable judgment,
decree, injunction or order of any Governmental Entity, or (iii)
subject to obtaining the consents set forth on Schedule 4.04,
will violate or conflict with or constitute a default (or an
event which, with notice or lapse of time or both, would
constitute a default) under or will result in the termination of,
or accelerate the performance required by, or result in the
creation of any Security Interest, upon any of the assets of
Sellers under, any term or provision of the Certificate of
Incorporation or Bylaws of either Seller or of any contract,
commitment, understanding, arrangement, agreement, order,
arbitration award, judgment, decree or restriction of any kind or
character to which either Seller is a party or by which either
Seller or any of their assets or properties may be bound or
affected, other than violations or conflicts which would not have
a material adverse effect on Sellers.
4.05 Consents. Except as required under the HSR Act
and except as set forth in Schedule 4.05, no authorization,
consent, approval, order or filing with or notice to any
Governmental Entity or another entity or person, is necessary for
the execution and delivery of this Agreement or any other
agreement or document to be delivered by Sellers or the
consummation by Sellers of the transactions contemplated hereby
or thereby, other than such authorization, consent, approval,
order, filing or notice, the lack of which would not have a
material adverse effect on Sellers, R&M, or the Companies.
4.06 No Brokerage Fees. No broker or finder has acted
for Sellers in connection with this Agreement or the transactions
contemplated hereby and no broker or finder is entitled to any
brokerage or finders fee or other commissions in respect of such
transactions based in any way on agreements, arrangements or
understandings made by or on behalf of Sellers.
4.07 Litigation. There is no order, judgment or decree
of any Governmental Entity, by which either Seller is bound and
no action, suit or other legal, administrative or arbitration
proceedings or investigations before any Governmental Entity is
pending or, to the Sellers' Knowledge, threatened, which, in each
case, would prohibit the execution and delivery of this Agreement
or the consummation of the transactions contemplated hereby.
4.08 Investment Representations. Eagle is an
"accredited investor" as defined in Rule 501 adopted under the
Securities Act. Eagle is acquiring the SARs and the R&M Note for
its own account and not with a view to any distribution thereof.
Eagle acknowledges that the issuance of the SARs and the R&M Note
pursuant to this Agreement have not been, and the issuance of any
R&M Shares issued upon exercise of SARs will not be registered
under the Securities Act or any applicable state securities laws,
in reliance upon an exemption from the registration requirements
of the Securities Act and such state laws and neither the SARs,
the R&M Note nor any R&M Shares so issued may be resold or
transferred unless they are registered under the Securities Act
and such state laws or unless an applicable exemption from
registration is available (and the certificates evidencing the
SARs, any R&M Shares and the R&M Note will bear legends setting
forth such restrictions and the other restrictions imposed under
the SAR Agreement or R&M Note Agreement). Eagle acknowledges
receiving copies of the R&M Reports and that it has had the
opportunity to ask questions and receive answers concerning the
terms and conditions of this Agreement and the issuance of the
SARs and the R&M Note and to obtain any additional information
which R&M possesses or can require without reasonable effort or
expense that is necessary to verify the accuracy of any
information provided by R&M to Eagle.
Section 5. Representations and Warranties of Sellers
Regarding the Companies. Each of the Sellers jointly and
severally represent and warrant the following to R&M as of the
date of this Agreement:
5.01 Title to Capital Stock of Subsidiaries. Except as
set forth in Schedule 5.01, Sellers, directly or indirectly, own
of record and beneficially all of the issued and outstanding
capital stock of the Subsidiaries, free and clear of any and all
Security Interests. At the Closing, when Sellers transfer and
convey the Pfaudler Stock and Chemineer Stock to R&M, Pfaudler
and Chemineer will, directly or indirectly, own of record and
beneficially all of the issued and outstanding capital stock of
the Subsidiaries, free and clear of any and all Security
Interests, including any listed on Schedule 5.01, except for
Security Interests created by R&M.
5.02 Organization, Foreign Qualification and
Capitalization. Each of the Companies is a corporation, duly
organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation, has all requisite corporate
power to carry on its business as it currently is conducted and
to own, lease or operate the properties and assets it now owns,
leases or operates. Except as set forth on Schedule 5.02, each
of the Companies is duly qualified or licensed to do business as
a foreign corporation and is in good standing in each of the
jurisdictions in which the conduct of its business or the
character and location of any property or personnel of the
Company requires such qualification or good standing, except
where the failure to be so licensed or qualified would not have a
material adverse effect on the Companies. All of the issued and
outstanding shares of capital stock of each Company have been
validly authorized and duly issued and are validly outstanding,
fully paid and nonassessable. None of the Companies holds shares
of its capital stock in its treasury and there are no outstanding
(i) subscriptions, calls, puts, options, warrants or other rights
with respect to any capital stock of any of the Companies, (ii)
securities convertible into or exchangeable for shares of any
capital stock of any of the Companies or (iii) other commitments
or agreements of any kind for the issuance of additional shares
of capital stock of any Companies or options, warrants or other
securities of any of them. Schedule 5.02 sets forth the names of
the officers and directors of each Company.
5.03 Corporate Information Table. The following
"Corporate Information Table" sets forth with respect to each of
the Companies: (a) the name under which the Company is
incorporated; (b) the state or other jurisdiction in which the
Company is incorporated; (c) the capitalization of each Company,
including the number of authorized shares of each class of its
stock, the number of issued and outstanding shares of each class
of its stock, the registered holders of any of the Company's
outstanding shares and the number of shares and class of its
stock held by each such registered owner as the same will be at
the Effective Time; and (d) the states or other jurisdictions in
which the Company is qualified to do business as a foreign
corporation.
CORPORATE INFORMATION TABLE
(1) PFAUDLER:
a. Legal name of Company: Pfaudler (United States), Inc.
b. Jurisdiction of Incorporation: Delaware
c. Capitalization of Company:
Number of Number of Name of Registered
Class of Authorized Outstanding Owner/Number of
Shares Shares Shares Shares Owned
Common,
$1.00 par -1,000- -1,000- Eagle Industrial Products
Corporation/all
d. Jurisdictions in which the Company is qualified to do
business as a foreign corporation: Illinois, Michigan,
Ohio, Texas, Missouri, North Carolina, South Carolina, New
York, Massachusetts, and Pennsylvania (with pending
qualifications in Alabama, West Virginia, New Jersey, and
Louisiana)
(2) CHEMINEER:
a. Legal name of Company: Chemineer, Inc.
b. Jurisdiction of Incorporation: Delaware
c. Capitalization of Company:
Number of Number of Name of Registered
Class of Authorized Outstanding Owner/Number of
Shares Shares Shares Shares Owned
Common,
$.01 par -1,000- -800- O.D.E. Manufacturing,
Inc./all
d. Jurisdictions in which the Company is qualified to do
business as a foreign corporation: California, Louisiana,
Ohio, Texas and Massachusetts
(3) EDLON:
a. Legal name of Company: Edlon Products, Inc.
b. Jurisdiction of Incorporation: Delaware
c. Capitalization of Company:
Number of Number of Name of Registered
Class of Authorized Outstanding Owner/Number of
Shares Shares Shares Shares Owned
Common,
$1.00 par -1,000- -1,000- Pfaudler (United States),
Inc./all
d. Jurisdictions in which the Company is qualified to do
business as a foreign corporation: Pennsylvania and
Tennessee
(4) PFAUDLER GERMANY:
a. Legal name of Company: Pfaudler-Werke GMBH
b. Jurisdiction of Incorporation: Germany
c. Capitalization of Company:
Number of Number of Name of Registered
Class of Authorized Outstanding Owner/Number of
Shares Shares Shares Shares Owned
--- -19,950,000- -19,950,000- Pfaudler (United States),
Inc./all
d. Jurisdictions in which the Company is qualified to do
business as a foreign corporation: None
(5) PFAUDLER HOLDINGS U.K.:
a. Legal name of Company: Pfaudler Balfour Holdings, Limited
b. Jurisdiction of Incorporation: England
c. Capitalization of Company:
Number of Number of Name of Registered
Class of Authorized Outstanding Owner/Number of
Shares Shares Shares Shares Owned
Ordinary -5,627- -5,627- Pfaudler (United States),
Inc./5,626
William K. Hall/1
d. Jurisdictions in which the Company is qualified to do
business as a foreign corporation: None
(6) PFAUDLER U.K.:
a. Legal name of Company: Pfaudler Balfour Limited
b. Jurisdiction of Incorporation: England
c. Capitalization of Company:
Number of Number of Name of Registered
Class of Authorized Outstanding Owner/Number of
Shares Shares Shares Shares Owned
Ordinary -100- -2- William K. Hall/1
Pfaudler Balfour Holdings,
Limited/1
d. Jurisdictions in which the Company is qualified to do
business as a foreign corporation: None
(7) PFAUDLER CRS U.K.:
a. Legal name of Company: Chemical Reactor Services Limited
b. Jurisdiction of Incorporation: England
c. Capitalization of Company:
Number of Number of Name of Registered
Class of Authorized Outstanding Owner/Number of
Shares Shares Shares Shares Owned
Ordinary -2,110- -2,110- Pfaudler Balfour Holdings,
Limited/2,109
Pfaudler Balfour Limited/1
d. Jurisdictions in which the Company is qualified to do
business as a foreign corporation: None
(8) PFAUDLER STOLINE U.K.:
a. Legal name of Company: Stoline Limited
b. Jurisdiction of Incorporation: Scotland
c. Capitalization of Company:
Number of Number of Name of Registered
Class of Authorized Outstanding Owner/Number of
Shares Shares Shares Shares Owned
Ordinary -999- -999- Pfaudler Balfour Holdings,
Limited/998
Pfaudler Balfour Limited/1
d. Jurisdictions in which the Company is qualified to do
business as a foreign corporation: None
(9) PFAUDLER PANAMA:
a. Legal name of Company: Pfaudler Development Corporation
b. Jurisdiction of Incorporation: Panama
c. Capitalization of Company:
Number of Number of Name of Registered
Class of Authorized Outstanding Owner/Number of
Shares Shares Shares Shares Owned
Common -400- -400- Pfaudler (United States),
Inc./all
d. Jurisdictions in which the Company is qualified to do
business as a foreign corporation: None
(10) PFAUDLER MEXICO:
a. Legal name of Company: Pfaudler S.A. de C.V.
b. Jurisdiction of Incorporation: Mexico
c. Capitalization of Company:
Number of Number of Name of Registered
Class of Authorized Outstanding Owner/Number of
Shares Shares Shares Shares Owned
--- --- 240,000 Pfaudler Development
Corporation/239,999
Gus J. Athas/1
d. Jurisdictions in which the Company is qualified to do
business as a foreign corporation: None
(11) PFAUDLER BRAZIL:
a. Legal name of Company: Pfaudler Equipamentos Industrias
Ltda.
b. Jurisdiction of Incorporation: Brazil
c. Capitalization of Company:
Number of Number of Name of Registered
Class of Authorized Outstanding Owner/Number of
Shares Shares Shares Shares Owned
Quotas 1,278,000,000 1,278,000,000 Pfaudler (United States),
Inc./1,277,999,042
Eagle Industries, Inc./958
d. Jurisdictions in which the Company is qualified to do
business as a foreign corporation: None
(12) PFAUDLER TORIN:
a. Legal name of Company: Torin Aerotecnica, Ltda.
b. Jurisdiction of Incorporation: Brazil
c. Capitalization of Company:
Number of Number of Name of Registered
Class of Authorized Outstanding Owner/Number of
Shares Shares Shares Shares Owned
Quotas 166,000,000 166,000,000 Pfaudler Equipamentos
Industrias
Ltda./165,999,986
Great American Management
and Investment, Inc./14
d. Jurisdictions in which the Company is qualified to do
business as a foreign corporation: None
(13) CHEMINEER U.K.:
a. Legal name of Company: Chemineer Limited
b. Jurisdiction of Incorporation: England
c. Capitalization of Company:
Number of Number of Name of Registered
Class of Authorized Outstanding Owner/Number of
Shares Shares Shares Shares Owned
Ordinary -- -50,002- Chemineer, Inc./50,000
David Barke/2
d. Jurisdictions in which the Company is qualified to do
business as a foreign corporation: None
5.04 No Violation. Neither the execution and delivery
of this Agreement or the other documents and instruments to be
executed and delivered by Sellers pursuant hereto, nor the
consummation by Sellers of the transactions contemplated hereby
or thereby (i) will violate any provision of the Certificate of
Incorporation or Code of Bylaws of any of the Companies, (ii)
will violate or be in conflict with any applicable law or any
applicable judgment, decree, injunction or order of any
Governmental Entity, or (iii) subject to obtaining the consents
set forth on Schedule 5.04, will violate or conflict with or
constitute a default (or an event which, with notice or lapse of
time or both, would constitute a default) under or will result in
the termination of, or accelerate the performance required by, or
result in the creation of any Security Interest, upon any of the
assets of any of the Companies under, any term or provision of
the Certificate of Incorporation or Bylaws of any of the
Companies or of any contract, commitment, understanding,
arrangement, agreement, order, arbitration award, judgment,
decree or restriction of any kind or character to which any of
the Companies is a party or by which any of the Companies or any
of their assets or properties may be bound or affected, other
than violations or conflicts which would not have a material
adverse effect on the assets or earnings of the Companies.
5.05 Title to Properties; Absence of Liens, Etc.
(a) Real Property Schedule. Set forth on Schedule 1.32
is a complete list of all owned Real Property and Leased Real
Property identified by street address. Listed on Schedule 1.32
is any lease, sublease or other agreement under which any of the
Companies has rights with respect to the Leased Real Property.
None of the Owned Real Property or Leased Real Property is leased
or subleased by the Company to another person.
(b) Title to Real Property and Tangible Assets. Except
as set forth in Schedule 5.05, each of the Companies has good and
marketable title to all its Owned Real Property and all of its
other tangible properties and assets, including without
limitation, those assets and properties reflected in the December
Balance Sheet and those that will be reflected in the Closing
Balance Sheet, free and clear of all Security Interest, except
(i) Security Interests for current Taxes not yet delinquent; (ii)
properties and assets disposed of since the date of the December
Balance Sheet in the ordinary course of business; (iii) Security
Interests and imperfections of title which do not individually or
in the aggregate materially detract from the value, or impair the
use, of the properties as currently used; (iv) inchoate mechanics
and materialmens' Security Interests for construction in
progress; (v) Security Interests of workmen, repairmen,
warehousemen and carriers arising in the ordinary course of
business which are not, material in amount; and (vi) as to Leased
Real Property, Security Interests arising as a result of actions
or inactions of the landlord or owner of such properties
unrelated to any default by any of the Companies under the terms
of occupancy of such property. Each of the Companies own, or
have valid and enforceable rights as lessees to possess and use,
all properties and assets used in the conduct of their respective
businesses since December 31, 1993, other than any properties or
assets disposed of since such date in the ordinary course of
business.
5.06 Receivables. Except as set forth in Schedule
5.06, all of the accounts, notes and other receivables which are
reflected in the December Balance Sheet, and that will be
reflected in the Closing Balance Sheet, were acquired in the
ordinary and regular course of business.
5.07 Financial Statements. Sellers have furnished R&M
the following consolidated financial statements of the Companies
which are attached at Schedule 5.07: (i) the consolidated
statements of financial condition of the Companies at
December 31, 1992 and December 31, 1993 and related statements of
income and cash flow and related notes for the twelve month
period ended July 31, 1992, the five month period ended
December 31, 1992, and the twelve month period ended December 31,
1993, examined by Arthur Andersen & Co., whose report and opinion
thereon is included therewith; (ii) the unaudited consolidated
balance sheet of the Companies at September 30, 1993 and related
statements of income and cash flow; and (iii) the unaudited
consolidated balance sheet of the Companies at March 31, 1994 and
related statement of income (when available) (all of which,
including the notes thereto, are collectively referred to as the
"Financial Statements"). The Financial Statements are in
accordance with the respective books and records of the
Companies, and except as noted in Schedule 5.07 or in such
Financial Statements, have been prepared in accordance with
generally accepted accounting principles applied on a consistent
basis throughout the periods covered by such statements and
fairly present in all material respects the financial condition,
assets and liabilities, net worth, profit and loss accounts and
retained earnings of the Companies on a consolidated basis as of
their respective dates and the results of operations for the
periods then ended.
5.08 Litigation. Schedule 5.08 sets forth every
investigation, action, suit, arbitration, or other legal
proceeding (herein "Legal Proceeding"), which involves any of the
Companies which is presently pending (except such actions, suits
or proceedings as have not been served on any of the Companies
and which are not Known to Sellers), or, to Sellers' Knowledge,
is threatened against any of the Companies other than those set
forth on Schedule 5.09 or 5.11. None of the Companies is in
violation of any judgment, decree, injunction or order
outstanding against any of them.
5.09 Product Liability. Schedule 5.09 is a true and
complete list of any action, arbitration or proceeding alleging
personal injury or property damage which relates to products or
services sold by any of the Companies which is presently pending
(except such actions, arbitrations, or proceedings as have not
been served on a Company and which are not Known to Sellers) or
which, to Sellers' Knowledge, have been threatened since
January 1, 1993 to be asserted against any of the Companies or
which to Sellers' Knowledge have been commenced since or settled
since January 1, 1989.
5.10 Contracts; Powers of Attorney. (a) Schedule 5.10
is a true and complete list of all Contracts of any of the
Companies other than Employee Plans of the Companies which are
listed at Schedule 5.15 and Real Estate Leases which are listed
at Schedule 1.30. Sellers have delivered to R&M true and
complete copies of each Contract listed on Schedule 5.10 and each
Real Estate Lease listed on Schedule 1.30. Except as set forth
on Schedule 5.10, none of the Companies is in default in any
material respect under any Contract and no condition or state of
facts exists which, with notice or the passage of time, or both,
would constitute such a default, except for such instances of
default which do not, either alone or in the aggregate,
materially adversely affect the financial condition or operations
of the Companies.
(b) Except as set forth on Schedule 5.10, there are no
persons holding powers of attorney from any of the Companies.
5.11 Environmental Compliance.
(a) Compliance with Law. Except as set forth in
Schedule 5.11, the Business is being operated in compliance with
all applicable Environmental Laws, except for such minor
instances of noncompliance which do not, either alone or in the
aggregate, materially adversely affect the financial condition or
operations of the Companies.
(b) Permits and Licenses. Except as set forth in
Schedule 5.11, each of the Companies has obtained all permits,
licenses and other authorizations which are required with respect
to the properties and operations of any of the Companies under
applicable Environmental Laws. Except as set forth in Schedule
5.11, each of the Companies is in compliance with all terms and
conditions of the required permits, licenses and authorizations,
and with any order, decree, or judgment of any Governmental
Entity affecting any of the Companies or its properties, except
for such minor instances of noncompliance which do not, either
alone or in the aggregate, materially adversely affect the
financial condition or operations of the Companies.
(c) Legal Proceedings. Except as set forth in Schedule
5.11, there are no actions, suits, demands, notices, claims,
investigations or proceedings under any Environmental Law pending
or, to Sellers' Knowledge, threatened against any of the
Companies or relating to any real property previously or
currently owned, leased, occupied or used by any of the Companies
or requests for information from any Governmental Entity making
inquiries relating to any Environmental Law or any notice that
any of the Companies is or may be a potentially responsible party
under any Environmental Law.
(d) Use or Storage of Hazardous Substances. Except as
set forth on Schedule 5.11, there are no Hazardous Substances
currently utilized at or stored at the Owned Real Property, the
Leased Real Property, or any other property leased, owned, or
operated by any of the Companies except for those for which
permits have been obtained and are in effect or are present in a
manner or in quantities which do not require issuance of permits
under the Environmental Laws.
(e) Releases of Hazardous Substances. Except as set
forth in Schedule 5.11, there has not been any release of any
Hazardous Substances on or from the Owned Real Property, the
Leased Real Property, or any other real property currently or
previously leased, owned, or operated by any of the Companies
during the time any such property was owned, leased, or operated
by any of the Companies except for such minor instances of
noncompliance which do not, either alone or in the aggregate,
materially adversely affect the financial condition or operations
of the Companies. The term "release" shall have the meaning
given to such term in Section 101(22) of CERCLA.
(f) Off-site Disposal of Hazardous Substances. Except
as set forth in Schedule 5.11, any Hazardous Substances removed
from the Owned Real Property, the Leased Real Property, or any
other property currently or previously owned, leased, or operated
by any of the Companies during the time the property was owned,
leased, or operated by any of the Companies was removed,
transported off-site, treated, stored or disposed of in
compliance with applicable Environmental Laws, except for such
minor instances of noncompliance which do not, either alone or in
the aggregate, materially adversely affect the financial
condition or operations of the Companies.
(g) Limitations. Nothing in this Section 5.11 shall be
construed as a representation or warranty regarding activities,
practices or conditions on the Owned Real Property, the Leased
Real Property or any other real property currently or previously
owned or operated by any of the Companies, prior to Eagle's
ownership of the Companies.
5.12 Kennecott Agreement. Neither Great American
Industrial Group, Inc., a Delaware corporation, nor Legibus 855,
Limited, an English corporation, assigned the Kennecott Agreement
or any portion thereof or its respective rights thereunder, to
any party who was not then an affiliate of the assignor, nor has
any assignee of the Agreement or such rights further assigned the
Kennecott Agreement or any portion thereof or its respective
rights thereunder to any party who was not then an affiliate of
such assignor. To Seller's Knowledge, the sellers under the
Kennecott Agreement and their respective successors and assigns
have never asserted that the indemnification provided to the
buyers under the Kennecott Agreement was not available to any
successor of the original buyers under the Agreement due to any
assignment thereof.
5.13 Compliance with Laws and Orders. Except as
disclosed in Schedule 5.11 or 5.13, to Sellers' Knowledge, the
Companies and the Business are currently operating in compliance
with any law ordinance, regulation, judgment, order, decree,
license or permit of any Governmental Entity (including without
limitation, zoning ordinances, building codes, occupational
health and safety laws and regulations and franchise laws and
regulations), except for possible violations which have not had,
and, insofar as reasonably can be foreseen will not have, a
material adverse effect on the financial condition or operations
of the Companies. Except as set forth on Schedule 5.11 or 5.13,
to Sellers' Knowledge, no investigation or review by any
Governmental Entity with respect to any of the Companies is
pending or threatened.
5.14 Permits and Licenses. Except as set forth in
Schedule 5.11 or 5.14, each of the Companies has all permits,
licenses, orders and approvals of all federal, state, local, and
foreign governmental or regulatory bodies required for to carry
on the Business as presently conducted, except for such permits,
licenses, orders and approvals, the absence of which does not
have a material adverse effect on the Companies. All of such
permits are in full force and effect, and to Sellers' Knowledge,
no suspension or cancellation of any of them is being threatened,
nor will any of the permits be affected by the consummation of
the transactions contemplated by this Agreement.
5.15 Employee Plans.
(a) Representations Applicable to All Employee Plans.
(i) Part I of Schedule 5.15 sets forth a complete list
of all Domestic Employee Plans, and Part II of Schedule 5.15
sets forth a complete list of all Foreign Employee Plans.
Sellers have previously delivered or made available to R&M
true and complete copies of all such Employee Plans, in each
case as in effect on the date of this Agreement.
(ii) Each Employee Plan has been maintained, operated
and administered in substantial compliance with its terms.
Each Domestic Employee Plan currently complies, and has at
all relevant times complied, in all material respects with
ERISA, the Code, and any other applicable laws.
(iii) Except as set forth on Schedule 5.15, no Domestic
Employee Plan provides benefits, including without
limitation, death or medical benefits (whether or not
insured), with respect to current or former employees beyond
their retirement or other termination of service, other than
(a) temporary coverage mandated by applicable law, (b) death
benefits or retirement benefits under any employee pension
plan, as that term is defined in Section 3(2) of ERISA, (c)
deferred compensation benefits accrued as liabilities on the
books of the Company providing the same, or (d) benefits the
full cost of which are borne by the current or former
employee (or his or her beneficiary).
(iv) No Domestic Employee Plan is involved in or is the
subject of any litigation or any claims other than routine
benefit claims, and to Sellers' Knowledge, no facts exists
which are reasonably expected to result in the filing of any
such litigation or claim that may have a materially adverse
effect on a Company.
(v) All required contributions to each Domestic
Employee Plan have been made, except for current
contributions not yet due and payable, all of which through
March 31, 1994 have been accrued and are reflected in the
Financial Statements.
(b) Qualified Plans.
(i) All "employee pension benefit plans" (within the
meaning of Section 3(2) of ERISA) listed in Part I of
Schedule 5.15 which are also stock bonus, pension or profit-
sharing plans within the meaning of Section 401(a) of the
Code are marked "Qualified" on such Schedule.
(ii) Each such plan has been duly authorized by the
appropriate board of directors of any of the Companies whose
employees participate in such a plan. Each such plan is
qualified in form and operation under Section 401(a) of the
Code and each trust under each such plan is exempt from tax
under Section 501(a) of the Code. No event has occurred that
will or could give rise to disqualification or loss of tax-
exempt status of any such plan or trust under such Sections.
No event has occurred that will subject any such plans to tax
under Section 511 of the Code.
(iii) Sellers have delivered to R&M for each such plan
copies of the following documents: (a) the Form 5500 filed
in the most recent plan year, including but not limited to
all schedules thereto and financial statements with attached
opinions of independent accountants, (b) the most recent
determination letter from the IRS, (c) the consolidated
statement of assets and liabilities of such plan as of its
most recent valuation date, and (d) the statement of changes
in fund balance and in financial position or the statement of
changes in net assets available for benefits under such plan
for the most recently ended plan year. The financial
statements so delivered fairly present the financial
condition and the results of operations of each of such plans
as of such dates, in accordance with generally accepted
accounting principles.
(iv) With respect to each plan subject to Section 412 of
the Code maintained for employees of any of the Companies, or
any of their ERISA Affiliates, there has occurred no failure
to meet the minimum funding standard of Section 412 of the
Code (whether or not waived in accordance with Section 412(d)
of the Code) or failure to make by its due date a required
installment under Section 412(m) of the Code.
(c) Title IV Plans.
(i) All Employee Plans listed in Part I of Schedule
5.15 which are also subject to Title IV of ERISA are marked
"Qualified and Subject to Title IV" on such Schedule.
(ii) With respect to each "employee pension benefit
plan" (within the meaning of Section 3(2) of ERISA) in which
any of the Companies or any ERISA Affiliate participates or
has participated, (a) none of the Companies nor any ERISA
Affiliate has withdrawn from such plan during a plan year in
which it was a "substantial employer" (as defined in Section
4001(a)(2) of ERISA) where such withdrawal could result in
liability of such substantial employer pursuant to Section
4062(e) or 4063 of ERISA, (b) none of the Companies nor any
ERISA Affiliate has filed a notice of intent to terminate any
such plan or adopted any amendment to treat any such plan as
terminated, (c) the PBGC has not instituted proceedings to
terminate any such plan, (d) no other event or condition has
occurred which might constitute grounds under Section 4042 of
ERISA for termination of, or the appointment of a trustee to
administer, any such plan, (e) no accumulated funding
deficiency, whether or not waived, exists with respect to any
such plan, and no condition has occurred or exists which with
the passage of time would be expected to result in an
accumulated funding deficiency as of the last day of the
current plan year of any such plan, (f) all required premium
payments to the PBGC have been paid when due, (g) no
reportable event, as described in Section 4043 of ERISA has
occurred with respect to any such plan except as set forth on
Schedule 5.15, (h) no excise taxes are payable under the Code
and (i) no amendment with respect to which security is
required under Section 307 of ERISA has been made or is
reasonably expected to be made.
(iii) All costs of any plans which are sponsored by any
of the Companies and subject to Title IV of ERISA and
identified in Part I of Schedule 5.15 as such have been
provided for on the basis of consistent methods in accordance
with sound actuarial assumptions and practices. Schedule
5.15 includes for each such plan, as of its last valuation
date, the amount by which its assets exceeded (or were less
than) its "benefit liabilities" (within the meaning of
Section 4001 of ERISA). Since the last valuation date for
each such plan, there has been no amendment or change to such
plan that would increase the amount of benefits thereunder
and, to Sellers' Knowledge, there has been no event or
occurrence that would cause the excess of assets over benefit
liabilities as listed in Schedule 5.15 to be reduced or the
amount by which benefit liabilities exceed assets as listed
in Schedule 5.15 to be increased.
(iv) In addition to the documents listed in Section
5.15(b) above, Sellers have delivered to R&M for each Title
IV plan which is sponsored by any of the Companies copies of
the following documents: (a) the Form PBGC-1 filed in each
of the most recent three plan years, and (b) the actuarial
report as of the last valuation date. Each such actuarial
report fairly presents the financial condition and the
results of operations of each such plan as of such date, in
accordance with generally accepted accounting principles.
5.16 Insurance. Schedule 5.16 sets forth a list and
description of the insurance policies currently maintained by any
of the Companies. No notice of suspension or cancellation of any
such policies has been received by any of the Companies or to
Sellers' Knowledge, is threatened in writing. R&M acknowledges
that coverage under such insurance policies will cease at the
Effective Time for occurrences after the Effective Time.
5.17 Capital Projects. Schedule 5.19 contains a
summary description of all capital projects committed for or
authorized by any of the Companies involving the expenditure of
Fifty Thousand Dollars ($50,000) or more.
5.18 Absence of Certain Changes, Events or Conditions.
Since December 31, 1993 and except as set forth in Schedule 5.20,
(1) the Business has been conducted in the ordinary course on a
basis consistent with past practice, (2) each of the Companies
have paid each of their respective creditors in the ordinary
course of business unless the existence or amount of indebtedness
is being contested in good faith, (3) except as reflected on the
Financial Statements, there has not been any material adverse
change in the financial position, results of operations, or net
worth of the Companies, or (4) none of the Companies have
declared, set aside, or paid any dividend or other distribution
in respect of its capital stock, or, directly or indirectly,
redeemed or otherwise acquired any of its capital stock.
5.19 Labor Matters. Except as set forth on Schedule
5.19, (i) there are no controversies pending between any of the
Companies and any of their respective employees, other than
routine individual grievances which will not have a materially
adverse affect on the Companies and (ii) no employee of any of
the Companies is represented by any labor union and, to Sellers'
Knowledge, no labor union is attempting any such representation.
5.20 Proprietary Property. Except as set forth on
Schedule 5.08, there are no pending and, to the best of Sellers'
Knowledge, threatened interference, opposition or infringement
actions, or any other proceedings with respect to the Proprietary
Information. Schedule 5.20 lists all of the patents, trademarks,
service marks, trade names and registered copyrights and all
applications for any of the foregoing which are owned by any of
the Companies. Subject to being challenged during any unexpired
opposition period provided under applicable law or to being
contested as improperly issued under applicable law, one of the
Companies will be at the Effective Time the registered owner and
have good and marketable title to the registered patents and
trademarks in the listed jurisdictions and, to Sellers'
Knowledge, good title to all of the other Proprietary
Information. To Sellers' Knowledge, each of the Companies has
valid, binding, enforceable and assignable rights to use all of
the other Proprietary Information it uses. R&M acknowledges that
Sellers do not make any representation or warranty hereunder that
third parties cannot and do not lawfully possess and use in their
business trade secrets, know-how, patents, trademarks, service
marks, trade names, copyrights, applications for any of the
foregoing and other similar proprietary or intellectual property
rights or interests which are similar to the Proprietary
Information. Except as set forth on Schedule 5.20, to Sellers'
Knowledge, there has been no infringement or misappropriation of
the Proprietary Information.
5.21 Affiliates. No part of the Business is conducted
through any Affiliate of Sellers other than the Companies.
5.22 Express Representations and Warranties Only. THE
BUSINESS AND ASSETS OF THE COMPANIES ARE BEING ACQUIRED BY R&M
PURSUANT TO THIS AGREEMENT WITHOUT REPRESENTATION OR WARRANTY OF
ANY KIND, EXPRESS OR IMPLIED, EXCEPT FOR SUCH REPRESENTATIONS AND
WARRANTIES AS ARE EXPRESSLY SET FORTH IN THIS AGREEMENT.
5.23 Predecessor Affiliates. For purposes of the
representations, warranties, or covenants of Sellers under this
Agreement with respect to any Company, "Company" includes any
predecessor company to a Company if the predecessor company was
owned by any person who was an Affiliate of any person who is now
an Affiliate of Eagle.
Section 6. Representations and Warranties of R&M. R&M
hereby represents and warrants the following to Sellers as of the
date of this Agreement:
6.01 Organization; Good Standing; and Qualification.
R&M is a corporation duly organized, validly existing and in good
standing under the laws of the State of Ohio, with the corporate
power and authority to conduct its business and to own and lease
its properties and assets.
6.02 Corporate Authority. R&M has the corporate power
and authority to execute, deliver and carry out the terms of this
Agreement and the other agreements and instruments to be executed
and delivered by it in connection with the transactions
contemplated hereby and thereby and has taken all necessary
corporate action, including approval by its Board of Directors,
to authorize the execution and delivery of this Agreement and
such other agreements and instruments and the consummation of the
transactions contemplated hereby and thereby. This Agreement is,
and the other agreements and instruments to be executed and
delivered by R&M in connection with the transactions contemplated
hereby and thereby will be, the legal, valid and binding
obligations of R&M, enforceable in accordance with their terms,
except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other laws
relating to or from time to time affecting the enforcement of
creditors' rights generally and except that the enforceability of
R&M's obligations is subject to general principles of equity
(regardless of whether such enforceability is considered in a
proceeding in equity or at law).
6.03 No Violation. Neither the execution and delivery
of this Agreement or the other documents and instruments to be
executed and delivered by R&M pursuant hereto, nor the
consummation by R&M of the transactions contemplated hereby or
thereby (i) will violate any provision of its Articles of
Incorporation or Code of Regulations, (ii) will violate or be in
conflict with any applicable law or any judgment, decree,
injunction or order of any Governmental Entity, or (iii) subject
to obtaining the consents set forth on Schedule 6.04, will
violate or conflict with or constitute a default (or an event
which, with notice or lapse of time or both, would constitute a
default) under or will result in the termination of, or
accelerate the performance required by, or result in the creation
of any Security Interest, upon any of the assets of R&M under,
any term or provision of the Certificate of Incorporation or
Bylaws of R&M or of any contract, commitment, understanding,
arrangement, agreement, order, arbitration award, judgment,
decree or restriction of any kind or character to which R&M is a
party or by which R&M or any of its assets or properties may be
bound or affected, other than violations or conflicts which would
not have a material adverse effect on R&M and Security Interests
created in connection with the bank loan agreements which R&M
intends to enter into at Closing and the R&M Note Agreement.
6.04 Consents. Except as required under the HSR Act
and except as set forth in Schedule 6.04, no authorization,
consent, approval, order or filing with or notice to any
Governmental Entity or another entity or person, is necessary for
the execution and delivery of this Agreement or any other
agreement or document to be delivered by R&M or the consummation
by R&M of the transactions contemplated hereby or thereby.
6.05 No Brokerage Fees. Except for Wasserstein Perella
& Co., Inc. and Scott W. Mohr, no broker or finder has acted for
R&M in connection with this Agreement or the transactions
contemplated hereby and no broker or finder is entitled to any
brokerage or finders fee or other commissions in respect of such
transactions based in any way on agreements, arrangements or
understandings made by or on behalf of R&M. Any and all fees of
Wasserstein Perella & Co., Inc. and Scott W. Mohr (or any firm
with which he is associated) due in connection with the
transactions provided for herein shall be the responsibility of
R&M.
6.06 Litigation. There is no order, judgment or decree
of any Governmental Entity, by which R&M is bound and no action,
suit or other legal, administrative or arbitration proceedings or
investigations before any Governmental Entity is pending or, to
R&M's knowledge, threatened, which, in each case, would prohibit
the execution and delivery of this Agreement or the consummation
of the transactions contemplated hereby.
6.07 Capitalization. The authorized capital stock of
R&M consists of 10,000,000 common shares ("R&M Shares"). As of
the date of this Agreement, there were 5,116,816 R&M Shares
issued and outstanding. There are no outstanding options,
warrants, convertible instruments or other rights, agreements or
commitments to acquire capital shares of R&M except for options
or rights granted under R&M's 1984 Stock Option Plan, Stock
Option Plan for Non-Employee Directors (1988), 1994 Long-Term
Incentive Plan and 1994 Directors Stock Compensation Plan.
6.08 Financing. R&M has the funds immediately
available to it, or commitments from responsible financial
institutions to provide the funds, required by R&M to consummate
the transactions contemplated hereby. R&M has provided Seller a
copy of such commitments.
Section 7. Arrangements as to Certain Employee Plans.
(a) Transfer from Eagle Savings Plan
(i) Each employee of the Companies who is a current
participant in the Eagle Industries, Inc. Employee Savings
Plan (the "Savings Plan") shall have his or her accrued
benefit under the Savings Plan become vested and
nonforfeitable in accordance with the terms of the Savings
Plan as of the Closing Date and shall be entitled to receive
an allocation of any and all employer contributions (if any)
made to the Savings Plan for the plan year which includes the
Closing Date, including the contributions required to be made
pursuant to paragraph (a)(iv) of this Section 7.
(ii) On or before ninety (90) days after the Closing
Date, Eagle shall cause the trustee of the Savings Plan to
transfer, to the trustee or trustees of the trust fund of a
qualified defined contribution plan maintained by R&M (either
currently existing or hereinafter established by R&M) (the
"Transferee Savings Plan") in cash or in marketable
securities at market values determined by the plan trustees,
the entire value of the accounts of each employee of the
Companies participating in the Savings Plan (excluding any
deferred vested former participants), as determined under the
provisions of the Savings Plan. Eagle will amend the Savings
Plan to the extent required to accomplish the transfer of
assets. All written elections governing the making and
investment of participant contributions, current written
beneficiary designation forms and findings regarding the
rights of alternate payees (as defined in Section 414(p) of
the Code) under the Savings Plan which are in effect on the
Closing Date shall become effective with respect to the
Transferee Savings Plan on and after the Closing Date and
shall continue in effect under the plan after the Closing
Date until changed in accordance with the terms of the
Transferee Savings Plan. Unless otherwise agreed by Eagle
and R&M, at least sixty (60) days prior to the transfer R&M
shall present to Eagle an executed copy of the Transferee
Savings Plan and either an opinion of counsel in a form
satisfactory to Eagle that the Transferee Savings Plan has
been duly adopted by R&M's board of directors and satisfies
the requirements for qualification under section 401(a) of
the Code or a determination letter issued by the Internal
Revenue Service that the Transferee Savings Plan meets the
requirements of Section 401(a) of the Internal Revenue Code
of 1986. At least sixty (60) days prior to the transfer
Eagle shall present to R&M either an opinion of counsel that
the Savings Plan has been duly adopted by Eagle's board of
directors and satisfies the requirements of Section 401(a) of
the Code or a determination letter issued by the Internal
Revenue Service that the Savings Plan meets the requirements
of Section 401(a) of the Internal Revenue Code of 1986.
Prior to any transfer hereunder, Eagle and R&M each shall
file Form 5310 or such other forms with the Internal Revenue
Service and the Department of Labor if required under
applicable law.
(iii) After the transfer described above, neither Eagle
nor the Savings Plan shall have any liability or obligation
to pay or otherwise provide to employees of the Companies any
benefits accrued under the Savings Plan, and R&M shall assume
full liability for such benefits; provided that R&M shall
have no liability whatsoever and Eagle shall remain liable to
employees of the Companies for any failure by Eagle to
operate the Savings Plan on a qualified basis under Section
401(a) of the Internal Revenue Code and in compliance with
applicable law prior to the transfer described in this
subsection.
(iv) At the Closing each of the Companies which is a
participating employer under the Savings Plan shall pay to
Eagle (and Eagle shall pay to the Savings Plan) all employee
and employer contributions of the Companies to the Savings
Plan not already transferred to the Savings Plan as of the
Closing Date, for all calendar months ending on or prior to
the Closing Date and for the calendar month in which the
Closing Date occurs. For purpose of this paragraph, employee
contributions shall be those amounts withheld from employees'
compensation for the period prior to and including the
Closing Date, and employer contributions shall be the
employer contributions required to be made with respect to
such employee contributions.
(b) Assumption of Union Savings Plan. Eagle maintains
the Eagle Industries, Inc. and Affiliates Savings Plan for Union
Employees (the "Transferred Savings Plan") for certain employees
of Pfaudler. Within sixty (60) days after the Closing Date,
Eagle shall take all actions necessary to cause the trustee of
the Transferred Savings Plan to transfer to R&M the Transferred
Savings Plan (and the related trusts or their assets), including
the obtaining of any consents of any trustees or administrators
or of any entity holding trust assets or in which trust assets
are invested, and R&M shall take all actions necessary to
formally assume as of the Closing Date the Transferred Savings
Plan, and related trusts, as plan sponsor. After effecting such
transfer, Eagle shall have no responsibility or liability for any
further funding of or any payments made or to be made from any
liabilities, obligations, losses, damages or expenses relating to
funding of or payments made or to be made from the Transferred
Savings Plan following the transfer of the Transferred Savings
Plan from Eagle to R&M; provided, that R&M shall have no
liability whatsoever for, and Eagle shall indemnify R&M and the
Companies from and against, any liability arising from the
failure by Eagle to operate the Transferred Savings Plan on a
qualified basis in compliance with applicable law prior to the
transfers contemplated by this subsection (b).
Section 8. Taxes; Tax Returns; and Tax Indemnities.
(a) Definitions. For purposes of this Section 8, the
following terms shall have the following meanings:
(i) "Consolidated Return" means any consolidated
federal income tax return or any other consolidated,
combined or unitary state or local tax return that has been
or will be filed for any Pre-Closing Tax Period by Sellers
or an Affiliate of Sellers on behalf of an affiliated group
of corporations of which one or more of the Companies was or
is includible as members.
(ii) "Pre-Closing Tax Period" means all taxable
periods ending on or before the Closing Date and that
portion to and including the Closing Date of any taxable
period that includes (but does not end on) the Closing Date.
(iii) "Tax" or "Taxes" means all taxes, charges, fees,
levies or other assessments imposed by any federal, state,
local, or foreign taxing authority, including without
limitation, income, excise, property, sales, use, transfer,
payroll, license, employment, production, gross receipts,
windfall profits, severance, withholding and franchise taxes
(including any interest, penalties or additions attributable
to or imposed on or with respect to any such assessment);
and any amounts that could be charged against any of the
Companies under a tax sharing agreement relating to a Pre-
Closing Tax Period.
(iv) "Tax Return" means any return, report,
information return, or other document (including any related
or supporting information) filed or required to be filed
with any federal, state, local, or foreign governmental
entity or other authority in connection with the
determination, assessment or collection of any Taxes or the
administration of any laws, regulations or administrative
requirements relating to any Taxes, including, without
limitation, consolidated federal income tax returns of the
Seller Group, declarations of estimated tax and tax reports
required to be filed with respect to any of the Companies or
any of their income, properties or operations.
(b) Section 338(h)(10) Election. Sellers and R&M
shall, at the time and in the manner requested by R&M, join in
making a Section 338(h)(10) election under the Code (or any
comparable election available in any state or local tax
jurisdiction) with respect to the purchase and sale of the Stock
(and the capital stock of Edlon) and, in connection therewith (i)
shall cause a Department of the Treasury Form 8023 that has been
appropriately completed to be timely filed on behalf of the
affiliated group of corporations, for federal income tax
purposes, of which any of the Companies is a member on the
Closing Date and (ii) take such other action as R&M shall
reasonably request including, without limitation, providing R&M
with any requested information, and making available and causing
appropriate persons to take any action on behalf of the Sellers
required for the making of a Section 338(h)(10) election (or any
comparable election in any state or local tax jurisdiction) in
accordance with Treasury Regulation Section 1.338(h)(10)-1 and
Department of the Treasury Form 8023 (or comparable regulations
of the applicable jurisdiction).
(c) Section 338(g) Election. R&M or the Companies, at
their sole discretion, may make a Section 338(g) election under
the Code for any or all of the Foreign Companies. If such
election or elections are made, R&M will give, or cause the
applicable Company to give, the notice required by Treasury
Regulation 1.338-1(g)(4).
(d) Indemnification of R&M Group. Subject to the
provisions of Section 8.1(f), Sellers shall be liable for, and
shall hold the R&M Group harmless from and against, any and all
Taxes due or payable by a Company for any Pre-Closing Tax Period,
including, without limitation, any liability pursuant to Treasury
Regulations Section 1.1502-6, or any comparable state or local
provisions. Taxes that Sellers shall be liable for and shall
hold the R&M Group harmless from and against shall include any
income and franchise taxes imposed by any state or political
subdivision thereof that result from or arise out of the filing,
in accordance with Treasury Regulation Section 1.338(h)(10)-1, of
a Section 338(h)(10) election (or any election of the applicable
jurisdiction which treats the purchase and sale of the Stock (and
the capital stock of Edlon) as a deemed purchase and sale of
assets) with respect to the purchase and sale of the Stock (and
the capital stock of Edlon). Any liability of Sellers for Taxes
under this Section 8.1(d) to the R&M Group in respect of any tax
period for which R&M or a Company will file a Tax Return pursuant
to Section 8.1(g) shall be paid by Sellers to R&M or the Company,
as applicable, within ten (10) business days after R&M provides
the Sellers with a copy of the Tax Return to be filed, but no
such payment shall be required if the liability for such Taxes is
included in the Closing Statement. Notwithstanding the
foregoing, Sellers shall not be required to indemnify the R&M
Group for any Taxes, other than income or franchise taxes, until
the amount of such Taxes which are not income or franchise Taxes
and which were not reserved against in the Closing Statement
exceeds $250,000 in the aggregate and then Sellers shall
indemnify R&M for the full amount of such Taxes.
(e) Indemnification Of Seller. Subject to the
provisions of Section 8.1(f), R&M and the Companies shall be
liable for, and shall hold the Seller Group harmless from and
against, any and all Taxes due or payable by a Company, R&M or
Sellers with respect to a Company for any taxable year or tax
period beginning after the Effective Time.
(f) Allocable Taxes. Taxes, other than Taxes payable
in respect of a Consolidated Return, for a tax period beginning
before the Effective Time and ending after the Effective Time
shall be apportioned between Sellers and the Companies based upon
the parties best estimate of the income and expenses allocable to
each parties period of ownership.
(g) Filing of Returns. R&M shall cause each of the
Companies to file any Tax Return (other than any Consolidated
Return) with respect to the business, activities or assets of any
of the Companies for any tax period beginning before the
Effective Time and ending after the Effective Time and R&M shall
pay or cause the relevant Company to pay (subject to Sellers'
obligations to R&M in respect of such Taxes therefor as provided
in Section 8.1(d)) all Taxes shown as due on any such Tax Return.
(h) Refunds. Any refunds or credits of Taxes
attributable to a Pre-Closing Tax Period for which Sellers are
liable for Taxes under Section 8.1(d) shall be for the account of
Sellers, provided, that if Sellers receive a refund or credit of
Taxes for any such periods and such Taxes are attributable solely
to the carry-back of losses, credits or similar items from a
taxable year or period that begins after the Effective Time and
attributable to a Company, after receipt Sellers shall promptly
pay to R&M the amount of such refund or credit, together with any
interest thereon received from the relevant taxing authority, and
if any such refund or credit of Taxes is subsequently reduced or
disallowed, R&M and the Companies shall hold Seller Group
harmless from any Taxes assessed against Sellers by reason of the
reduction or disallowance.
(i) Maintenance of Records and Assistance. Sellers
and R&M shall each maintain (or, in the case of R&M, cause the
Companies to maintain) the books and records that relate to any
Tax Return of a Company or any Consolidated Return for a period
of not less than seven years following the filing date of such
Tax Return or Consolidated Return, shall thereafter give the
other party at least 30 days notice of its intention to destroy
any such records and shall, at the other party's request and
expense, to the extent such records relate to a Company, turn
over any such records to the other party instead of destroying
them. As soon as practicable after a request by Sellers or R&M
("Requesting party"), R&M or Sellers, as the case may be (the
"Delivering Party"), shall deliver to the Requesting Party such
information and data and make available such knowledgeable
persons employed at the time of the request by the Delivering
Party as the Requesting Party may reasonably request, in order to
enable the Requesting Party to complete and file all Tax Returns
which it is required to file with respect to the activities or
assets of a Company or to respond to audits by any taxing
authorities with respect to such activities or assets. The
Delivering Party's obligation under this paragraph to permit the
Requesting Party access to and to review the foregoing materials
is conditioned upon the Requesting Party's execution of a
reasonable confidentiality agreement with respect thereto.
(j) Notice. If R&M or a Company becomes aware of any
assessment, official inquiry, examination or proceeding that
could result in an official determination with respect to any Tax
for which Sellers could be liable pursuant to this Agreement, R&M
shall promptly so notify Sellers in writing. If Sellers become
aware of any official inquiry, examination or proceeding that
could result in an official determination with respect to any Tax
for which R&M or a Company could be liable pursuant to this
Agreement, Sellers shall promptly so notify R&M in writing.
(k) Sellers and R&M agree that the Companies will
remain a member of the consolidated federal income tax return of
the Sellers and their Affiliates for the period through the
Closing Date and that a Company will not make an election
pursuant to Treasury Income Tax Regulation Section 1.1502-
76(b)(5).
(l) New York Real Property Gains Tax.
(i) Sellers and R&M agree to comply timely with the
requirements of Article 31-B of the Tax law of the State of
New York relating to gain realized from the transfer of real
property located in New York, as the same from time to time
may be amended (collectively, the "Gains Tax Law") in good
faith and in such manner as to avoid any postponement of the
Closing or of the transfer of the Stock at Closing. R&M
agrees to deliver to Seller a duly executed and acknowledged
Transferee Questionnaire, if applicable, within five (5)
business days after written request from Sellers. At the
Closing, Sellers shall deliver or cause to be delivered
either (i) an official Statement of No Tax Due, (ii) an
official Tentative Assessment and Return accompanied by a
certified check or official bank check (drawn on a New York
Clearinghouse member bank) payable to the order of the State
Tax Commission in the amount of the tax shown to be due
thereon (it being understood, however, that if Sellers have
duly elected to pay such tax in installments, the amount so
required to be paid shall be the minimum installment of such
tax then permitted to be paid), or (iii) if applicable, a
duly executed and acknowledged affidavit in form permitted
under the Gains Tax Law claiming exemption therefrom.
(ii) Sellers further agree to pay promptly any
installment(s) or additional tax due under the Gains Tax
Law, and interest and penalties thereon, if any, which may
be assessed or become due after the Closing for which
Sellers are responsible pursuant to Section 8.1(d).
(iii) In addition to making the payment and delivering
the instruments and documents referred to above in this
Section, Sellers and R&M shall timely execute, acknowledge
and deliver such further documents and instruments as may be
necessary to comply with the Gains Tax Law.
(m) New York Real Property Transfer Tax. Sellers
shall file any Tax Return required under Article 31 of the Tax
law of the State of New York relating to the conveyance of real
property located in the State of New York within 15 days after
the Closing Date and pay and hold harmless the R&M Group against
all Taxes, if any, arising thereunder.
(n) Each of the Sellers jointly and severally
represents and warrants the following to R&M as of the date of
this Agreement:
(i) Tax Return Filings. The Companies have duly filed
or caused to be filed, or shall duly file or cause to be
filed, in a timely manner (taking into account all
extensions of due dates) with the appropriate federal,
state, county, local and foreign governmental agencies all
Tax Returns, which are required to be filed on or before the
Closing Date by or on behalf of the Companies and such
returns are (or will be, in the case of those filed or
caused to be filed between the date hereof and the Closing
Date) complete and correct in all material respects, and all
Taxes shown to be due on such Tax Returns have been or will
have been paid in full on or before the Closing Date.
(ii) International Boycott. None of the Companies has
participated in (and will not participate in) an
international boycott within the meaning of Section 999 of
the Code.
(iii) U.S. Real Property Holding Corporation. None of
the Companies is, and none has been, a United States real
property holding corporation (as defined in Section
897(c)(2) of the Code) during the applicable period
specified in Section 897(c)(1)(A)(ii) of the Code.
(iv) Permanent Establishment. None of the Companies
have, or has had, a permanent establishment in any foreign
country other than their respective country of formation.
(v) Passive Foreign Investment Company. None of the
Foreign Companies is, or have been, a Passive Foreign
Investment Company or have Qualifying Election Fund Status
within the meaning of the Code.
Section 9. Representations and Warranties of Sellers
Regarding the India Company. Sellers represent and warrant the
following to R&M as of the date of this Agreement:
9.01 Capitalization and Title to Capital Stock. There
are 1,591,800 equity shares of the India Company issued and
outstanding. At the Closing, when Eagle transfers and conveys
the Pfaudler Stock to R&M, Pfaudler will own of record and
beneficially 636,720 equity shares of the issued and outstanding
capital stock of the India Company free and clear of any and all
Security Interests, except for Security Interests created by R&M,
which shares represent 40% of the outstanding equity shares of
the India Company.
9.02 Organization. The India Company is a
corporation, duly organized, validly existing and in good
standing under the laws of India, with the corporate power and
authority to conduct its business and to own and lease its
properties and assets.
Section 10. Certain Covenants of Sellers.
10.01 Interim Operations of the Companies. During the
period from the date of this Agreement to the Effective Time,
except as specifically contemplated by this Agreement, as
required by applicable laws or regulations or proper orders of
Governmental Entities, or as otherwise consented to by R&M in
writing (and R&M shall designate one or more persons to be
available, which persons shall have the authority to provide such
consent):
(a) Conduct of Business. Seller shall cause each of
the Companies to conduct its business in, and only in, the
regular course in substantially the same manner as
heretofore conducted.
(b) Governing Instruments. Sellers shall not permit
any of the Companies to make any change or amendment to or
repeal their respective Certificate of Incorporation or By-
laws or comparable governing instruments.
(c) Capital Stock. Sellers shall not permit any of
the Companies to issue or sell shares of capital stock or
any other securities of any of them or issue any securities
convertible into or exchangeable for, or rights to purchase
relating to, or enter into any contract, commitment or
arrangement with respect to the issuance of, any shares of
capital stock or any other securities of any of them, or
adjust, split, combine or reclassify any of their capital
stock or other securities, or amend, permit acceleration of,
or otherwise make any other changes in their capital
structures.
(d) Dividends. Sellers shall not permit any of the
Companies to declare, set aside, pay or make any dividend or
other distribution or payment (whether in cash, stock or
property) with respect to, or purchase or redeem, any shares
of their capital stock.
(e) Employee Plans, Compensation, Etc. Sellers shall
not permit any of the Companies to adopt or amend any bonus,
profit sharing, compensation, severance, stock option,
pension, retirement or other employee benefit agreement,
trust, plan or arrangement for the benefit or welfare of any
present or former director, officer or employee of any of
the Companies. Sellers shall not permit any of the
Companies to increase the compensation or fringe benefits of
any present or former director, officer or employee (except
that, in the case of employees who are not officers,
individual merit increases and promotional increases, not to
exceed 5% of salary, in accordance with past practices may
be granted, but no across-the-board or generally applicable
increases may be granted), or pay any bonus, compensation or
benefit not required by any existing Employee Plan, or hire
any employee at an annual rate of compensation (including
anticipated incentive compensation, if any) in excess of
$65,000, or enter into any contract, agreement, commitment
or arrangement to do any of the foregoing.
(f) Sale of Assets. Other than in the ordinary course
of business, Sellers shall not permit any of the Companies
to lease, sell or dispose of, or contract to lease, sell or
dispose of, in any single transaction or series of related
transactions, any asset or group of assets having a value,
or selling price, or aggregate rental, in excess of $50,000.
(g) Purchase of Assets. Other than in the ordinary
course of business, Sellers shall not permit any of the
Companies to lease, purchase or otherwise acquire, in any
single transaction or series of related transactions, any
asset or group of assets having a value or purchase price,
or lease payments, in excess of $50,000, except that each of
the Companies shall be permitted to, and shall, continue any
existing capital expenditure projects or programs listed in
Schedule 5.17 in a manner consistent with the performance of
such projects or programs prior to the date of this
Agreement.
(h) Investments, Loans and Guarantees. Seller shall
not permit any of the Companies to make any investment
(whether by acquisition of stock, capital contribution or
otherwise) in, or make any loan or advance to, or enter into
or renew any guarantee on behalf of, any person which
continues after the Effective Time other than a directly or
indirectly wholly-owned Subsidiary of Pfaudler or Chemineer
or become committed to do so.
10.02 Access, Information and Confidentiality.
(a) During the period from the date of this Agreement
to the Effective Time, Sellers shall provide to R&M and R&M's
authorized representatives reasonable access during normal
business hours to the books and records of Eagle and its
Affiliates, but only insofar as such access is reasonably
required in regard to R&M's due diligence review of the financial
statements and Business of the Companies (e.g. items related to
financial statement consolidation, consolidated or combined Tax
Returns, insurance, administration and Employee Plans).
(b) During the period from the date of this Agreement
to the Effective Time, Sellers shall cause each of the Companies
to provide to R&M and R&M's authorized representatives reasonable
access during normal business hours to the facilities and to the
books and records of each of the Companies and shall cause the
officers and the officers of each of the Companies to promptly
furnish R&M with such information with respect to the business
and properties of each of the Companies as R&M or its authorized
representatives from time to time may reasonably request.
(c) R&M shall indemnify and hold Sellers and the
Companies and their respective employees and agents, and each of
them, harmless from and against any and all losses, claims,
damages and liabilities (including, without limitation,
reasonable attorneys' fees incurred in connection therewith)
arising out of or resulting from R&M's exercise of its rights
under this Section 10.02.
10.03 Confidentiality. After the Effective Time,
Sellers shall keep confidential, except as to directors and
officers of R&M and its Affiliates, all information concerning
the Companies and the Business which was considered confidential
by either Seller or any of the Companies prior to the Closing
Date, unless such information is required to be disclosed by law
or is readily ascertainable from public or published information
or trade sources.
10.04 Stand-still Provisions. Without the prior
written consent of R&M duly authorized by a majority of its
Board of its Directors, Sellers will not, and will cause any
entity controlled by Eagle Industries, Inc. not, at any time
prior to July 1, 2002 to, directly or indirectly:
(a) acquire (except for shares acquired under the SAR
Agreement), directly or indirectly, by purchase or
otherwise, any Shares or any other securities of R&M
entitled to vote generally in the election of directors of
R&M or securities convertible into such securities ("Voting
Securities") provided, however, this Section 10.04 shall not
prohibit Sellers or any of their Affiliates from acquiring
Voting Securities by way of stock splits or dividends or
other distributions or exchanges or warrants or other rights
made available to holders of Voting Securities generally;
(b) "solicit" proxies with respect to Voting
Securities under any circumstances or become a "participant"
in any "election contest" relating to the election of
directors of R&M, as such terms are defined in Regulation
14A under the Securities Exchange Act of 1934 (the "1934
Act"); and
(c) except for shares of R&M acquired under the SAR
Agreement, become a member of any "group" as defined under
Section 13(d)(3) of the 1934 Act which would be required to
file a Schedule 13D under such Act except for a group or
groups in which the only members are Sellers and/or
Affiliates of Sellers.
Section 11. Certain Covenants of R&M.
11.01 Personnel Required in Response to Litigation.
R&M agrees to make certain employees of the Companies available
to Sellers as reasonably required by either Seller after the
Closing Date in the event that any litigation which either Seller
is required to defend is commenced or previously was commenced
against the Companies. Sellers agree to reimburse R&M for
reasonable out-of-pocket expenses incurred by R&M to third-
parties in connection with requests by Sellers pursuant to this
Section 11.01.
11.02 Confidentiality. R&M agrees that any
information contained in any Schedule or Exhibit to this
Agreement or otherwise provided to R&M pursuant to this Agreement
shall be held by R&M as confidential information in accordance
with, and shall be subject to the terms of, that certain
confidentiality agreement dated October 11, 1993 between R&M and
Eagle Industries, Inc. and entered into in connection with the
transactions contemplated hereby (the "Confidentiality
Agreement"). The terms of the Confidentiality Agreement are
hereby incorporated by reference herein and shall continue in
full force and effect, and if this Agreement is terminated or if
the Closing shall not have occurred for any reason whatsoever,
the Confidentiality Agreement shall thereafter remain in full
force and effect in accordance with its terms.
11.03 Use of the Name "Eagle". After the Effective
Time, R&M may continue to use existing supplies of sales
literature, stationery, signs and other materials which identify
Eagle provided (i) that with respect to products shipped to
customers of R&M after the Effective Time, R&M shall use
reasonable commercial efforts to remove or block-out the name
"Eagle" or any derivation thereof and (ii)that with respect to
all other materials, R&M shall also use reasonable commercial
efforts to block-out such identifying names and where such is not
practical because, for example, of the repeated use of the names
in a sales brochure, R&M shall at least stamp its name in the
forepart of the brochure. Notwithstanding the foregoing, R&M
shall cease all use of the name "Eagle" or any derivation thereof
within six months after the Effective Time.
Section 12. Certain Additional Agreements and
Covenants of Sellers and R&M.
12.01 HSR Act Filing.
(a) General. Sellers and R&M acknowledge that the
transactions contemplated by this Agreement require filings with
the Federal Trade Commission (the "FTC") and the Antitrust
Division of the United States Department of Justice (the
"Antitrust Division") under the HSR Act.
(b) Filings. Seller and R&M shall each promptly file
with the FTC and the Antitrust Division the notifications and
reports required to be filed pursuant to the HSR Act and shall
undertake in good faith to file promptly any supplemental
information which may be requested in connection therewith, which
notifications and reports comply, and filing of supplemental
information will comply, in all material respects with the
requirements of such act. Seller and R&M shall each furnish the
other with such information as either may reasonably request to
make such filings.
12.02 Consummation of Transactions. Upon the terms and
subject to the conditions of this Agreement, each of the parties
hereto agrees to use reasonable commercial efforts (i) to take,
or cause to be taken, all such actions and to do, or cause to be
done, all other things necessary to carry out its obligations
hereunder; (ii) to cause the conditions to the obligations of the
other party hereto to be satisfied prior to or at the Closing;
and (iii) to consummate and make effective, as soon as reasonably
practicable, the transactions contemplated by this Agreement,
including obtaining all waivers, permits, consents and approvals
and effecting all registrations, filings and notices with or to
third parties or governmental or public bodies or authorities
which are necessary in connection with the transactions
contemplated by this Agreement, including making promptly as
possible the required filings under the HSR Act; provided,
however, that this Section 12.02 shall not require either party
to waive any condition for its benefit or any performance
hereunder by the other party; and provided, further, that this
Section 12.02 shall not require such party to take any action the
result of which, in its reasonable judgment, would be to impose
material limitations on its ability to consummate and retain the
full benefits of the transactions contemplated hereby.
12.03 Public Announcements. Sellers and R&M agree that
no press release or other public statements with respect to the
transactions contemplated by this Agreement shall be issued
unless the content and timing thereof are mutually agreed upon;
provided, however, that nothing contained herein shall prohibit
any party from issuing any press release or other public
statement which such party in good faith believes is required by
applicable law or regulation or by a proper order of any
Governmental Entity. The initial press release announcing this
Agreement shall be a joint press release. Thereafter, Eagle and
R&M shall consult with each other in issuing any press releases
or otherwise making public statements with respect to the
transactions contemplated hereby and in making any filings with
any Governmental Entity. Without limiting the generality of the
foregoing, Eagle and R&M shall consult with each other concerning
the timing and content of communications to customers of the
Companies concerning this Agreement and the transactions
contemplated hereby. Sellers shall take reasonable commercial
steps to cause each of the Companies to restrict their press
releases and other public statements to the communications which
R&M and Eagle approve or are otherwise permitted under this
Section.
12.04 Notice of Certain Events.
(a) Should any director or officer of Sellers acquire
knowledge after the date of this Agreement of (i) any occurrence,
omission or state of events which constitutes a breach of any
representation, warranty or covenant of Sellers in this
Agreement, (ii) any material adverse change in the financial
condition, results of operations, properties, or business of the
Companies, (iii) the institution or threat of institution of any
litigation or governmental investigation relating to this
Agreement, or (iv) the occurrence, or the failure to occur, of
any other event if such occurrence or failure is reasonably
likely to result in the failure to satisfy any condition
specified in Section 13 to the obligation of R&M to consummate
the transactions, Sellers shall, promptly after the director or
officer of Eagle or its Affiliate acquires such knowledge, notify
R&M thereof in writing, in sufficient detail to permit a
reasonable analysis thereof. Eagle also shall furnish to R&M
such additional information related to the matter in question as
R&M reasonably may request.
(b) Should any director or officer of R&M acquire
knowledge after the date of this Agreement of (i) any occurrence,
omission or state of events which constitutes a breach of any
representation, warranty or covenant of R&M in this Agreement,
(ii) any material adverse change in the financial condition,
results of operations, properties, or business of R&M, (iii) the
institution or threat of institution of any litigation or
governmental investigation relating to this Agreement, or
(iv) the occurrence, or the failure to occur, of any other event
if such occurrence or failure is reasonably likely to result in
the failure to satisfy any condition specified in Section 14 to
the obligation of Sellers to consummate the transactions, R&M
shall, promptly after the director or officer of R&M acquires
such knowledge, notify Sellers thereof in writing, in sufficient
detail to permit a reasonable analysis thereof. R&M also shall
furnish to Sellers such additional information related to the
matter in question as Sellers reasonably may request.
12.05 Items Received after Effective Time. Sellers
shall promptly pay or transfer to R&M, if and when received, any
amounts or other items which shall be received by either Seller
after the Effective Time in respect of any of the Companies which
R&M is entitled to receive under this Agreement.
12.06 Access to Records. R&M agrees that on and after
the Closing it will permit Sellers and their representatives
during normal business hours to have access to and examine and
make copies of all of the Records. Each Seller agrees that it
will use its reasonable commercial efforts to prevent the
disclosure to any person or use by any person of any confidential
information which is delivered to either Seller pursuant to this
Section 12.06 other than pursuant to a court order or subpoena or
with respect to tax returns and other reports required by law.
All Records will be preserved by R&M and all Records relating to
the Companies which are not delivered to the Companies hereunder
will be preserved by Sellers, in each case, for a period of seven
years following the Closing.
12.07 Further Assurances. Each party shall at the
request of the other party do and perform or cause to be done and
performed all such further acts and furnish, execute and deliver
such other documents, instruments, certificates, notices or other
further assurances as counsel for the requesting party may
reasonably request, from time to time, to consummate more
effectively the transactions contemplated by this Agreement or to
vest in R&M all of Sellers' right, title and interest in the
Companies.
12.08 Expenses; Sales and Other Transfer Taxes. Except
as otherwise provided in this Agreement, each party will pay all
fees and expenses incurred by it in connection with this
Agreement and the transactions contemplated hereby. If the
Closing of the transactions contemplated herein does not occur
and this Agreement has not been terminated by R&M pursuant to
Section 17.01(b), then R&M shall pay the charges of Arthur
Andersen & Co. for services performed pursuant to the letter of
Arthur Andersen & Co. to Mr. Sam Cattone, dated May 11, 1994; if
the Closing of the transactions contemplated herein does occur,
then Eagle shall pay the charges of Arthur Andersen & Co.
pursuant to such letter.
12.09 Outstanding Letters of Credit. R&M shall
undertake all necessary actions to replace the Companies'
outstanding letters of credit or performance bonds with letters
of credit or performance bonds from R&M's financing source both
prior to and after July 31, 1994. In the event R&M is unable to
replace all such letters of credit or performance bonds by
July 31, 1994, it shall deliver to Eagle by July 31, 1994 a
letter of credit or cash in the amount of such outstanding
letters of credit or performance bonds to serve as security in
the event such outstanding letters of credit or performance bonds
are drawn upon after the Closing. Upon R&M's replacement of the
Companies' outstanding letters of credit and performance bonds,
Sellers shall return to R&M its letter of credit or cash less the
amount of any drawings on Sellers' letters of credit and any fees
and/or interest incurred by Sellers relating thereto.
12.10 Repayment of Intercompany Debt. Except for the
indebtedness of Falcon to Pfaudler Germany under the German Loan
Agreement, at or prior to the Effective Time, the entire amount
of indebtedness owed by the Companies to the Sellers and/or their
Affiliates (other than the Companies) and the entire amount of
indebtedness owed by the Sellers and/or its Affiliates (other
than the Companies) to the Companies, outstanding on the Closing
Date, shall be cancelled and forgiven without the payment of any
money in connection therewith, and any such cancellation and
forgiveness of intercompany debt shall be treated as a
contribution to equity or a dividend, as appropriate.
Notwithstanding the foregoing, intercompany payables owed by the
Companies to Sellers and/or their Affiliates for goods or
services provided in the ordinary course of business or any
inter-company receivables owed by the Sellers and/or its
Affiliates to the Companies for goods or services provided in the
ordinary course of business shall not be cancelled at the Closing
unless payment is made therefor.
12.11 Consents.
(a) Prior to or at the Closing, Sellers shall: (i) use
commercially reasonable efforts to obtain all consents or waivers
from third parties necessary to assure that the sale of the Stock
to R&M does not result in termination of any of the Contracts;
provided, however, to the extent that any Contract would
terminate as a result of the sale of the Stock to R&M without the
consent or waiver of a third person, Sellers agree to use
commercially reasonable efforts to obtain the consent or waiver
of such third person; and further provided that obtaining any
such consents or waivers shall not be a condition precedent to
the occurrence of the Closing unless the failure to obtain a
waiver or consent would have a material adverse affect on any of
the Companies, and the failure to obtain any such consents and
waivers shall not constitute a breach of this Agreement.
(b) After the Closing, to the extent that the consents
and waivers referred to above have not been obtained, Sellers
agree to use commercially reasonable efforts to provide to the
affected Company the benefits of any such contract, permit, lease
agreement or other property interest, cooperate in any reasonable
and lawful arrangement designed to provide such benefits to the
affected Company, and enforce, at the request of R&M for the
account of the affected Company any rights of Sellers under any
such lease, contract, permit, agreement or other property
interest.
12.12 WFE Test Center. Sellers agree to bear the costs
of the PCB Decontamination of the WFE Test Center. R&M agrees to
cause Pfaudler to vacate occupancy of the WFE Test Center by no
later than July 31, 1994, or such later date as agreed to by the
landlord, but in no event later than December 31, 1994.
12.13 Responsibility for Insurance Coverage.
(a) Liability and Workers Compensation Insurance.
Sellers hereby covenant that the Companies are insured parties
under the Sellers' current general liability, products liability,
employers' liability and workers' compensation insurance
policies, which provide coverage on an "occurrence" basis (the
"Present Insurance"). Sellers shall be responsible and liable
for all claims associated with occurrences prior to the Effective
Time of a category or type subject to coverage under the Present
Insurance but only to the extent it (or a third party on its
behalf) actually receives insurance proceeds or protection
relating thereto (an "Insurance Covered Occurrence"). To the
extent such Insurance Covered Occurrence is subject to a
deductible or self-insured retention, the Companies shall be
responsible and liable for said amount.
(b) Medical Insurance. R&M acknowledges that employees
of the Companies shall be ineligible to participate in any
employee welfare benefit plans maintained by Sellers after the
Closing and agrees that none of Sellers or any of its Affiliates
shall be liable for any claim incurred by an employee of the
Companies on or after the Closing, and the Companies shall bear
all such liability, if any. For purposes of the preceding
sentence, a claim shall be deemed incurred when the service which
results in such claim is rendered, irrespective of when the
illness or injury giving rise to such services, was first
contracted or incurred.
12.14 Letters of Credit. In the event any Affiliates
of Sellers (other than the Companies) have issued letters of
credit (or at anytime after the date hereof are required to issue
letters of credit relating to the self-insured retention
referenced in Section 12.13(a)) to third-parties on behalf of any
of the Companies, R&M shall substitute new letters of credit for
such outstanding letters of credit or make appropriate cash
deposits that will permit the termination of then outstanding
letters of credit issued by Sellers on their Affiliates (other
than the Companies) or shall deliver a back-up letter of credit
in an appropriate amount to serve as security in the event such
outstanding letters of credit are not replaced and are drawn upon
after the Closing. R&M shall deliver to Eagle at the Closing a
back-up letter of credit in the amount of $2,500,000.
Section 13. Conditions to R&M's Obligations. The
obligations of R&M are subject to satisfaction, prior to or at
the Closing, of each of the following conditions (all or any of
which may be waived in whole or in part by R&M):
13.01 Accuracy of Representations and Warranties. The
representations and warranties of Sellers contained in this
Agreement, and the statements contained in the Exhibits and
Schedules, shall have been true and correct in all material
respects when made and, except as contemplated or permitted
herein or therein or except as consented to by R&M in writing or
as otherwise contemplated in this Agreement, shall continue to be
true and correct in all material respects as of the Effective
Time with the same effect as though made at the Effective Time,
and Sellers shall have performed and complied with, in all
material respects, all agreements, obligations and conditions
required by this Agreement to be performed or complied with by
Sellers prior to or at the Closing.
13.02 Litigation. No action, suit, or proceeding
relating to the transactions contemplated hereby shall be
instituted by any party and remain pending, in which there is, or
is likely to be, sought a temporary, preliminary or permanent
judgment, order or decree restraining or enjoining consummation
of the transactions contemplated hereby or requiring any holding
separate or divestiture of any substantial portion of the assets
of the Companies by R&M.
13.03 Consents and Approvals. All waiting periods
under the HSR Act shall have expired or terminated. All
government approvals and required consents of any parties
necessary to consummation by Sellers of the transactions
contemplated by this Agreement shall have been obtained and
delivered to R&M.
13.04 Financing Commitments. No events or
circumstances shall have occurred which result in the Senior
Lenders withdrawing their commitment to loan funds to R&M under
the Loan Commitment Letters of the Senior Lenders, dated April
22, 1994, or modifying the terms of the Loan Commitment Letters
to such an extent, that R&M believes in good faith, after
consultation with Eagle, that R&M should not proceed with the
transactions contemplated herein. Notwithstanding anything to
the contrary contained in this Agreement, in the event R&M fails
to proceed with the transactions contemplated herein because of
the withdrawal or modification of the Loan Commitment Letters or
any failure of the Senior Lenders to loan funds to R&M under the
Loan Commitment Letters, then this Agreement shall terminate and
in connection with a termination arising under this Section 13.04
provided there has not been a material breach of this Agreement
by Sellers, R&M shall pay Eagle $1,000,000 within 30 days after
such termination as liquidated damages, which shall be the sole
damages Sellers shall be entitled to on account of a termination
of this Agreement arising under Section 13.04.
Section 14. Conditions to Sellers' Obligations. The
obligations of Sellers under this Agreement are subject to
satisfaction, prior to or at the Closing, of each of the
following conditions (all or any of which may be waived in whole
or in part by Sellers):
14.01 Accuracy of Representations and Warranties. The
representations and warranties of R&M contained herein shall have
been true and correct in all material respects when made and,
except as otherwise provided or permitted herein or except as
consented to by Sellers in writing or as otherwise contemplated
by this Agreement, shall continue to be true and correct in all
material respects on and as of the Effective Time with the same
effect as though made at the Effective Time, and R&M shall have
performed and complied with, in all material respects, all
agreements, obligations and conditions required by this Agreement
to be performed or complied with by it prior to or at the
Closing, including, but not limited to, purchase of the
receivables pursuant to the Receivables Agreement.
14.02 Litigation. No action, suit or proceeding
relating to the transactions contemplated hereby shall be
instituted by any party and remain pending, in which there is, or
is likely to be sought, a temporary, preliminary or permanent
judgment, order or decree restraining or enjoining consummation
of the transactions contemplated hereby.
14.03 Consents and Approvals. All waiting periods
under the HSR Act shall have expired or terminated. All
approvals and required consents of any parties, necessary to
R&M's consummation of the transactions contemplated by this
Agreement shall have been obtained by R&M and delivered to
Sellers; and the Sellers's lenders under the Chemical Agreements
shall have consented to the transactions under this Agreement.
Sellers shall use reasonable commercial efforts to obtain such
consent by no later than June 30, 1994, but in the event such
consent is not obtained, then this Agreement shall terminate.
Notwithstanding anything to the contrary contained in this
Agreement, in connection with a termination arising under this
Section 14.03, Sellers shall pay R&M, as liquidated damages
within 30 days of such a termination, R&M's documented due
diligence and other expenses incurred in connection with the
transactions contemplated in this Agreement, but not to exceed
$1,000,000, provided there has not been a material breach of this
Agreement by R&M. Such liquidated damages shall be the sole
damages R&M shall be entitled to on account of a termination of
this Agreement arising under this Section 14.03.
Section 15. Survival of Representations and Warranties.
(a) The representations and warranties of Sellers or
R&M contained in this Agreement or made pursuant to this
Agreement shall not be deemed waived or otherwise affected by any
investigation made by any party hereto. Except as provided in
subsection (b) below, all representations and warranties made by
Sellers to R&M in this Agreement shall survive the Closing Date
and continue until December 31, 1995, or until the termination
and abandonment of this Agreement pursuant to Section 17 or
otherwise. Any right of indemnification pursuant to Section 16
with respect to a claimed breach of a representation or warranty
shall expire at the date of termination of the representation or
warranty claimed to be breached (the "Termination Date"), unless
on or prior to the Termination Date written notice asserting such
breach, which shall reasonably set forth, in light of the
information then known to the party giving such notice, a
description of and estimate (if then reasonable to make) of, the
amount involved in such breach (the "Estimated Claim") has been
given to the party from whom indemnification is sought. Provided
that an Estimated Claim is timely made, it may continue to be
asserted beyond the Termination Date of the representation and
warranty to which such Estimated Claim relates.
(b) Notwithstanding anything in this Section 15 to the
contrary:
(i) the representations and warranties made in
Sections 4.01 to 4.05 (other than 4.04(iii)), inclusive,
5.01 to 5.04 (other than 5.04(iii)), inclusive, 6.01 to
6.04, inclusive, and 6.07 shall not expire;
(ii) the representations and warranties made in
Section 8 shall expire 90 days after the expiration of
the period during which any Tax (as defined in
Section 8) deficiency may be asserted for any period
prior to the Effective Time; and
(iii) the representations and warranties made in
Section 5.11 shall expire 48 months after the Effective
Time.
(c) The covenants and agreements of Sellers or R&M set
forth in this Agreement shall survive the Closing and shall
continue until all obligations set forth herein shall have been
performed or satisfied or they shall have terminated in
accordance with their terms.
Section 16. Indemnity.
(a) Indemnification of the R&M Group. Subject to the
terms and conditions of this Section 16, Sellers hereby agree,
jointly and severally, to indemnify, defend and hold harmless
R&M, each of the Companies, and each of their respective
Affiliates, directors, officers and employees and the successors
and assigns of any of them (the "R&M Group") at any time after
the Closing from and against all demands, claims, actions or
causes of action, assessments, losses, damages, liabilities,
costs and expenses (including, without limitation, reasonable
fees and expenses of counsel), (collectively, "Damages"),
asserted against, resulting to, imposed upon or incurred by any
member of the R&M Group, directly or indirectly, by reason of or
resulting from:
(i) a breach of any representation or warranty of
either Seller contained in or made pursuant to this
Agreement;
(ii) a breach by either Seller of any covenant,
agreement or obligation of either Seller contained in or
made pursuant to this Agreement;
(iii) any liability of any member of the R&M Group
in respect of any Legal Proceeding (as defined at
Section 5.08) disclosed or required to be disclosed in
Schedule 5.08, except that Sellers shall have no
obligation to indemnify any member of the R&M Group (1)
for any Legal Proceeding disclosed or required to be
disclosed in Schedule 5.08 which involves an Insurance
Covered Occurrence (as defined at Section 12.13) and
Sellers' sole obligation with respect to any Insurance
Covered Occurrence shall be as set forth at Section
12.13(a); or (2) under this Section 16(a)(iii) for any
Legal Proceeding disclosed or required to be disclosed
on Schedule 5.11; or (3) for any Legal Proceeding for
which indemnification is available under the Kennecott
Agreement;
(iv) subject to the provisions of Section 16(f),
any liability of any member of the R&M Group in respect
of any of the Legal Proceedings disclosed or required to
be disclosed on Schedule 5.11 except that Sellers shall
have no obligation to indemnify any member of the R&M
Group under this Section 16(a)(iv) (1) for any Legal
Proceeding being handled by other parties who have not
advised one of the Companies that they are reserving a
right to assert a claim against the Company in such
proceeding and (2) for such environmental matters until
all Damages arising under this Section 16(a)(iv) and
Section 12.12 exceed $250,000 in the aggregate and then
only to the extent such Damages exceed $250,000
provided, however, the obligations of Sellers under this
Section 16(a)(iv) shall expire 48 months after the
Closing Date as to any matter for which a written
estimated claim for Damages under this Section has not
been submitted prior to expiration of 48 months after
the Closing Date;
(v) any liability arising out of the use of
asbestos in, or in packing for, products sold by the
Companies while the businesses of the Companies were
owned by Sellers or an Affiliate of Sellers, provided,
however, the obligations of Sellers under this Section
16(a)(v) shall expire 48 months after the Closing Date
as to any matter for which a written estimated claim for
Damages under this Section has not been submitted prior
to expiration of 48 months after the Closing Date
(collectively with the claims set forth in Section
16(b), "Claims"); and
(vi) any costs or expenses incurred by R&M or a
Company, not reserved against on the Closing Statement,
related to the corporate restructuring of Eagle
Industries, Inc., effective January 31, 1994, as a
result of which the assets of Pfaudler (United States),
Inc., a Delaware corporation incorporated on April 21,
1987, were ultimately transferred to Pfaudler and any
costs and expenses incurred by R&M or a Company, not
reflected on the Closing Balance Sheet, associated with
the transfer of the legal title of any of the
Proprietary Information to one of the Companies.
(b) Indemnification of Seller Group. Subject to the
terms and conditions of this Section 16, R&M hereby agrees to
indemnify, defend and hold harmless Sellers and each of their
respective Affiliates (including any person who was a director or
officer of any of the Companies prior to the Effective Time),
directors, officers and employees and the successors and assigns
of any of them (the "Seller Group") at any time after the
Closing, from and against all Damages asserted against, resulting
to, imposed upon or incurred by any member of the Seller Group,
directly or indirectly, by reason of or resulting from:
(i) a breach of any representation or warranty of
R&M contained in or made pursuant to this Agreement; or
(ii) the breach by R&M of any covenant, agreement
or obligation of R&M contained in or made pursuant to
this Agreement (collectively with the claims set forth
in Section 16(a), "Claims");
(c) Indemnification Threshold. Notwithstanding
anything contained in this Agreement to the contrary, (i) Sellers
shall not be liable to indemnify any member of the R&M Group for
Damages pursuant to Section 16(a)(i) resulting from any breach of
a representation or warranty of Sellers contained in Section 4 or
5 until the aggregate amount of all such Damages exceeds $750,000
(the "Minimum Amount") and then Sellers shall be liable for 75%
of all Damages up to the first $750,000; 50% of the next $250,000
in Damages; and then 100% of all Damages in excess of $1,000,000.
Notwithstanding anything to the contrary contained in the Section
16(c), Sellers shall indemnify and hold harmless the R&M Group
against any and all Damages incurred by the R&M Group by reason
of a breach of Sellers' representations and warranties contained
in Sections 4.01 and 5.01 of this Agreement without regard to the
Minimum Amount.
(d) Procedures Applicable to Third-Party Claims. The
obligations and liabilities of Sellers or R&M to indemnify the
other under Section 16(a) or (b) with respect to Claims asserted
by a person other than a member of the R&M Group or the Seller
Group shall be subject to the following terms and conditions:
(i) Right of Indemnifying Party to Assume Defense
of Claim. The party to be indemnified (the "Indemnified
Party") should give the other party (the "Indemnifying
Party") prompt notice of any such Claim, and, subject to
the provisions of Section 16(d)(v), the Indemnifying
Party, at its sole cost and expense, shall have the
right, upon written notice to the Indemnified Party that
it is assuming defense of the Claim, to assume the
defense of the Claim while reserving its right to
contest the issue of whether it is liable to the
Indemnified Party for any indemnity hereunder. If the
Indemnifying Party assumes the defense of the Claim, it
shall select counsel reasonably acceptable to the
Indemnified Party to conduct the defense of the Claim
and shall defend or settle the same; provided, however,
that if it shall later be determined that the
Indemnified Party is not entitled to indemnification
with respect to the matter as to which Indemnifying
Party has undertaken the defense of the Claim, the
Indemnified Party shall reimburse the Indemnifying Party
for reasonable fees and disbursements of counsel and for
any amounts paid in judgment or settlement prior to such
determination.
(ii) Control of the Defense. The contest of the
Claim may be conducted in the name and on behalf of the
Indemnifying Party or the Indemnified Party, as may be
appropriate. Subject to compliance by the Indemnifying
Party with the other requirements of this Section
16(d)(ii), such contest shall be conducted diligently by
reputable counsel employed by the Indemnifying Party,
but the Indemnifying Party shall keep the Indemnified
Party fully informed with respect to the Claim and the
contest thereof. Subject to compliance by the
Indemnifying Party with the other requirements of this
Section 16(d)(ii), if the Indemnified Party joins in any
such contest, the Indemnifying Party shall have full
authority, in consultation with the Indemnified Party,
to determine all action to be taken with respect
thereto; provided, however, the Indemnifying Party shall
not consent to a settlement of, or the entry of any
monetary judgment arising from, the Claim, without the
prior written consent of the Indemnified Party which
shall not be unreasonably withheld or delayed; and
further provided that if the Indemnified Party shall
fail or refuse to consent to a settlement or judgment
proposed by the Indemnifying Party and a judgment
thereafter shall be entered or a settlement shall be
effected in an amount in excess of the settlement or
judgment proposed by the Indemnifying Party, the
Indemnifying Party shall have no liability hereunder
with respect to such excess or any expenses or other
Damages related thereto arising after the date such
settlement or judgment is so proposed. In no event
shall the Indemnifying Party have authority to agree to
any relief other than the payment of money damages by
the Indemnifying Party unless agreed to by the
Indemnified Party.
(iii) Cooperation in Defense. If requested by the
Indemnifying Party, the Indemnified Party agrees to
cooperate with the Indemnifying Party and its counsel,
including permitting reasonable access to books and
records, in contesting any Claim which the Indemnifying
Party elects to contest or, if appropriate, in making
any counterclaim against the person asserting the Claim,
or any cross-complaint against any person, but the
Indemnifying Party will reimburse the Indemnified Party
for reasonable out-of-pocket costs (but not the cost of
employee time expended) incurred by the Indemnified
Party in so cooperating. The Indemnifying Party agrees
to use its best efforts to afford the Indemnified Party
and its counsel the opportunity to be present at, and to
participate in, conferences with all persons, including
governmental authorities, asserting any Claim against
the Indemnified Party or conferences with
representatives of or counsel for such persons.
(iv) Failure of Indemnifying Party to Assume
Defense. If the Indemnifying Party does not assume the
defense of the Claim in accordance with the terms hereof
within 20 days after the receipt of notice thereof, the
Indemnified Party may, at the Indemnifying Party's
expense, defend against the Claim in such reasonable
manner as it may deem appropriate; provided that the
Indemnified Party shall not agree to any settlement of
the Claim without the prior written consent of
Indemnifying Party, which shall not be unreasonably
withheld or delayed.
(v) Claims Below the Minimum Amount. The right to
indemnification pursuant to Section 16(a)(i) or Section
16(b)(i) does not arise with respect to a Claim until
the aggregate amount of all Damages alleged in the
Claim, together with all prior Claims, exceeds the
Minimum Amount, except that the party who would be the
Indemnifying Party if the Minimum Amount had been
reached shall have the right to participate in, but not
control, the defense of the Claim.
(vi) Compliance with Procedures. Notwithstanding
the terms of this Section 16, the Indemnified Party
shall not be entitled to indemnification pursuant to
this Section 16 unless the Indemnified Party (x)
delivers the notice required under Section 16(d)(i) (and
in the case of a representation and warranty, prior to
the expiration of the representation and warranty in
issue) and (y) permits the Indemnifying Party to
exercise its rights under Section 16 with respect to the
defense of claims or legal proceedings; provided,
however, that the failure to comply with the foregoing
requirements under (y) shall constitute a defense to the
indemnity obligations of the Indemnifying Party
hereunder only to the extent that the Indemnifying Party
suffers actual prejudice as the result of such failure
to comply.
(e) Damages. When calculating Damages under this
Section 16, Damages shall be calculated net of any tax benefit or
insurance proceeds realized by the Indemnified Party as a result
of the events giving rise to its right to indemnification under
this Section 16.
(f) Limitations on Certain Environmental Matters.
Notwithstanding anything contained in this Agreement to the
contrary, Sellers shall have no obligation to Indemnify any
member of the R&M Group pursuant to Section 16(a) for any of the
following:
(i) Any Damages caused by or relating to the presence
of asbestos or asbestos containing building materials in the
Owned Real Property, the Leased Real Property or any other
real property owned or operated by any of the Companies,
including but not limited to the cost of an asbestos survey
or any asbestos removal or other abatement activities;
(ii) Any Damages caused by or relating to the presence
of soil or ground water contamination on, in or under the
Owned Real Property, the Leased Real Property or any other
property owned or operated by any of the Companies, to the
extent such contamination originated from an off-site
source;
(iii) Any Damages caused by or relating to the
investigation or clean up of solid waste, debris or
contamination at the Owned Property, the Leased Real
Property or any other property owned or operated by any of
the Companies, except to the extent such investigation or
clean up is required by applicable Environmental Laws;
(iv) Any Damages caused by or relating to the removal
and replacement of electrical transformers containing PCBs
at the Owned Real Property, the Leased Real Property or any
other property owned or operated by any of the Companies,
provided, however, that this provision shall not apply to
the cost of remediating a release of PCB's from the
transformers if remediation is required by applicable
Environmental Laws;
(v) Any Damages associated with monitoring stormwater
run-off at the Owned Real Property, the Leased Real Property
or any other property owned or operated by any of the
Companies; and
(vi) Any Damages for the costs of purchasing or
installing new test equipment, upgrading the waste water
control system (other than as required to comply with
applicable Environmental Laws), strengthening construction,
relocating the outside path and parking lot, or providing
external blast deflectors at the WFE Test Center.
(g) Exclusive Nature of Indemnification Provisions.
The right of the parties hereto to demand and receive
indemnification pursuant to Section 16(a)(i) or 16(b)(i) shall be
the sole remedy exercisable by a party with respect to a breach
of any warranty or representation set forth herein other than a
breach under Section 8 or related to the termination of this
Agreement pursuant to Section 17.
(h) To the extent Sellers' indemnification obligations
under Section 16 of this Agreement extend to matters for which
any of the Companies has claims or causes of action against third
parties, R&M shall cooperate fully with Sellers in taking all
actions reasonably necessary to provide Sellers the benefit of
such claims or causes of action.
Section 17. Termination, Amendment and Waiver.
17.01 Termination of Agreement. This Agreement may be
terminated at any time prior to the Closing:
(a) by mutual agreement of R&M and Eagle;
(b) by R&M, if there has been a material violation or
breach by either Seller of any of the agreements, representations
or warranties of either Seller contained in this Agreement,
unless Sellers have informed R&M that such violation or breach
will be cured on or before the Closing Date;
(c) by Sellers, if there has been a material violation
or breach by R&M of any of the agreements, representations or
warranties of R&M contained in this Agreement, unless R&M has
informed Sellers that it will be cured on or before the Closing
Date;
(d) by R&M as permitted under Section 13.04; and
(e) by either party hereto (other than a party who is
in material breach of its obligations under this Agreement) if
the Closing shall not have occurred on or prior to September 30,
1994.
17.02 Effect of Termination. In the event of
termination of this Agreement by either R&M or Sellers as
provided in Section 17.01, this Agreement shall forthwith be of
no further force and effect (except that the provisions of
Sections 10.02(c), 11.02, 12.03, 12.08, 13.04 and 17.02 shall
continue in full force and effect) and there shall be no
liability on the part of R&M or Sellers, except based upon: (i)
a material and willful breach by a party of any of its
obligations under this Agreement or (ii) the obligations set
forth in Sections 10.02(c), 11.02, 12.03, 12.08, 13.04 or 17.02.
17.03 Amendment, Extension and Waiver. At any time
prior to the Closing Date, R&M and Sellers may (a) amend this
Agreement, (b) extend the time for the performance of any of the
obligations or other acts of the parties hereto, (c) waive any
inaccuracies in the representations and warranties contained
herein or in any document delivered pursuant hereto, or (d) waive
compliance with any of the agreements or conditions contained
herein; provided, however, that any such amendment must be in
writing and must be signed by each of the parties hereto and the
agreement with respect to any such extension or waiver must be in
writing and must be signed by the party or parties agreeing to
such extension or waiver.
Section 18. Miscellaneous.
18.01 Assignment; No Third-Party Rights. This
Agreement shall be binding upon and shall inure to the benefit
of, and be enforceable by, the parties hereto and their permitted
successors and assigns. This Agreement may not be assigned by
either party without the prior written consent of the other,
except (i) that Eagle may, without the prior consent of R&M,
assign this Agreement and the rights of Sellers hereunder to any
Affiliate of Sellers and (ii) R&M may, with the prior written
consent of Sellers which will not be unreasonably withheld,
assign the rights of R&M hereunder to take title to the Stock,
and indirectly to take title to the stock of any Subsidiary, to
any Affiliate of R&M. No assignment of this Agreement shall
relieve the assigning party of responsibility for the performance
of any of its obligations hereunder. Nothing herein is intended
to, nor shall it, create any rights in any person other than the
parties hereto, other members of the R&M Group or the Seller
Group, and their respective successors and assigns.
18.02 Entire Agreement. This Agreement and the
agreements to be executed in connection herewith set forth the
entire agreement and understanding of the parties in respect of
the transactions contemplated hereby and supersede all prior
agreements, arrangements and understandings relating to the
subject matter hereof. All Schedules and Exhibits and any
documents and instruments delivered pursuant to any provisions
hereof are expressly made a part of this Agreement as fully as
though completely set forth herein.
18.03 Section and Other Headings; Number. The section
and other headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Words used in this Agreement
in the singular number shall be held to include the plural, and
vice versa, unless the context requires otherwise.
18.04 Notices. All notices, requests, demands and
other communications under this Agreement shall be in writing and
shall be deemed to have been duly given (i) on the date of
service if served personally on the party to whom notice is to be
given, (ii) on the day of transmission if sent via facsimile
transmission to the facsimile number given below, and telephonic
confirmation of receipt is obtained promptly after completion of
transmission, (iii) on the day after delivery to Federal Express
or similar overnight courier or the Express Mail service
maintained by the United States Postal Service, or (iv) on the
fifth day after mailing, if mailed to the party to whom notice is
to be given, by registered or certified mail, postage prepaid and
properly addressed, to the party as follows:
If to R&M:
Robbins & Myers, Inc.
1400 Kettering Tower
Dayton, Ohio 45423
Telephone: 513/222-2610
FAX: 513/225-3314
Attention: Daniel W. Duval
President and Chief
Executive Officer
With a copy to:
Thompson, Hine and Flory
2000 Courthouse Plaza N.E.
Dayton, Ohio 45402-8801
Telephone: 513/443-6586
FAX: 513/443-6637
Attention: Joseph M. Rigot, Esq.
If to Eagle or ODE:
Eagle Industries, Inc.
Two North Riverside Plaza
Chicago, Illinois 60606
Telephone: 312/906-6880
FAX: 312/906-8402
Attention: William K. Hall
President and Chief
Executive Officer
With copies to:
Eagle Industries, Inc.
Two North Riverside Plaza
Chicago, Illinois 60606
Telephone: 312/906-6860
FAX: 312/906-8402
Attention: Gus J. Athas, Esq.
Senior Vice President,
General Counsel and Secretary
and
Rosenberg & Liebentritt, P.C.
Suite 1600
Two North Riverside Plaza
Chicago, Illinois 60606
Telephone: 312/466-3456
FAX: 312/454-0335
Attention: Bruce C. Strohm, Esq. and
Jordan B. Allen, Esq.
or to such other address as the person to whom notice is to be
given may have previously furnished to the other in writing in
the manner set forth above.
18.05 Law Governing. This Agreement shall be governed
by, and construed and enforced in accordance with, the laws of
the State of Ohio without regard to its conflict of law rules.
18.06 Counterparts. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an
original but all of which taken together shall constitute one and
the same instrument.
18.07 Resolution of Disputes.
(a) In the event of a dispute between the parties
arises under the terms of this Agreement, either party may send
to the other a letter of dispute setting forth in particular the
subject matter of the dispute ("Disputed Matter"). The parties
shall meet at the offices of R&M in Dayton, Ohio, or such other
place as may be mutually agreeable to them, not later than twenty
days after the date of the receipt of the letter of dispute for
the purposes of negotiating a settlement of the Disputed Matter.
(b) In the event that either party determines after
compliance with Section 18.07(a) that the Disputed Matter cannot
be resolved by the parties, the Disputed Matter shall be
submitted to binding arbitration before a panel of three
arbitrators in Cleveland, Ohio in accordance with the Commercial
Arbitration Rules of the American Arbitration Association;
provided, however, that (i) the parties may engage in prehearing
discovery to the full extent provided in the Federal Rules of
Civil Procedure, and (ii) evidentiary rules contained in the
Federal Rules of Civil Procedure shall govern the submission of
evidence at the arbitration hearings. Judgment upon the award by
the arbitrators may be entered in any court having jurisdiction
thereof. As part of such award the arbitrators may establish
their fee and expenses in connection therewith. The fees and
expenses of the arbitrators shall be apportioned between the
parties by the arbitrators in accordance with the findings and
results of the arbitration.
(c) Notwithstanding the provisions of Section 18.07(a)
and (b), no person shall be required to comply with the
provisions of Section 18.07(a) and (b) if the primary remedy a
person is seeking is an injunction or restraining order.
IN WITNESS WHEREOF, each of the parties hereto have
caused this Agreement to be executed by its respective officers
thereunto duly authorized as of the date first above written.
"Sellers"
EAGLE INDUSTRIAL PRODUCTS
CORPORATION
Attest: By: /s/ Gus J. Athas
---------------------------
Title: Senior Vice-President
/s/ Bruce C. Strohm
- ----------------------
O.D.E. MANUFACTURING, INC.
Attest: By: /s/ Gus J. Athas
---------------------------
Title: Senior Vice-President
/s/ Bruce C. Strohm
- ----------------------
"R&M"
ROBBINS & MYERS, INC.
Attest: By: /s/ Daniel W. Duval
--------------------------
Daniel W. Duval
President and Chief Executive
/s/ Joseph M. Rigot Officer
- ----------------------
<PAGE>
UNDERTAKING OF EAGLE INDUSTRIES, INC.
If on November 30, 1996, the net worth of Eagle is less
than $175,000,000 and R&M has submitted any Estimated Claims for
indemnification pursuant to Section 16(a) of the Agreement and
any such Claims remain unresolved, then Eagle Industries, Inc.
("EII") shall, on or before November 30, 1996: (i) cause the
payment of the aggregate amount of any unresolved Estimated
Claims, when and if the same become payable, to be guaranteed by
EII or an Affiliate of EII having a net worth of $175,000,000 or
more or (ii) provide to R&M a performance bond with respect to
the payment of any unresolved Estimated Claims equal to the
lesser of $15,000,000 or the aggregate amount of the unresolved
Estimated Claims.
All defined terms used herein shall have the meaning
ascribed to them in the foregoing Stock Purchase Agreement.
EAGLE INDUSTRIES, INC.
By: /s/ Gus J. Athas
------------------------
Title: Senior Vice-President
Date: June 29, 1994
UNDERTAKING OF GREAT AMERICAN MANAGEMENT AND INVESTMENT, INC.
In order to induce R&M to enter into the Agreement,
Great American Management and Investment, Inc., a Delaware
corporation, guarantees the obligations of Sellers under the
Agreement to indemnify, and hold harmless, the R&M Group against
any federal income tax liability arising under a Consolidated
Return.
All defined terms used herein shall have the meaning
ascribed to them in the foregoing Stock Purchase Agreement.
GREAT AMERICAN MANAGEMENT AND INVESTMENT, INC.
By /s/ Sheli Z. Rosenberg
------------------
Title Vice-President
Date June 29, 1994
Exhibit 2.2
SAR AND REGISTRATION RIGHTS AGREEMENT
BETWEEN
ROBBINS & MYERS, INC.
AND
EAGLE INDUSTRIAL PRODUCTS CORPORATION
Dated as of June 30, 1994
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I - DEFINITIONS
1.1 Definitions. . . . . . . . . . . . . . . . . . . . .1
ARTICLE II - ISSUANCE OF RIGHTS; RIGHTS CERTIFICATES
2.1 Initial Issuance of Rights . . . . . . . . . . . . .7
2.2 Rights Certificates. . . . . . . . . . . . . . . . .7
2.3 Execution and Registration of Rights Certificates. .7
2.4 Exchanges and Transfers of Rights Certificates . . .8
2.5 Lost, Stolen, Destroyed or Mutilated Rights
Certificates . . . . . . . . . . . . . . . . . . . .8
ARTICLE III - EXERCISE OF RIGHTS
3.1 Exercise . . . . . . . . . . . . . . . . . . . . . .9
3.2 Payment for Rights; Method of Payment. . . . . . . .9
3.3 Cash Payment . . . . . . . . . . . . . . . . . . . 10
3.4 Share Payment. . . . . . . . . . . . . . . . . . . 10
3.5 Payment Following Triggering Event . . . . . . . . 10
3.6 Purchase and Sale of Shares by R&M or an Affiliate .11
ARTICLE IV - REDEMPTION OF RIGHTS
4.1 Redemption . . . . . . . . . . . . . . . . . . . . 11
4.2 Cash Payment . . . . . . . . . . . . . . . . . . . 11
4.3 Share Payment. . . . . . . . . . . . . . . . . . . 11
4.4 Effectiveness of the Redemption. . . . . . . . . . 12
ARTICLE V - ADJUSTMENT OF RIGHTS
5.1 Adjustment . . . . . . . . . . . . . . . . . . . . 12
5.2 Adjustment Upon Issuance or Sale of
Additional Shares. . . . . . . . . . . . . . . . . 12
5.3 Adjustment Upon Subdivision or Combination
of Shares. . . . . . . . . . . . . . . . . . . . . 14
5.4 Effect of Reorganization, Reclassification,
Consolidation or Merger. . . . . . . . . . . . . . 14
5.5 Adjustment Certificate . . . . . . . . . . . . . . 16
5.6 Issuance of New Rights Certificates. . . . . . . . 16
5.7 Notice of Certain Events . . . . . . . . . . . . . 16
5.8 Other Dilutive Events. . . . . . . . . . . . . . . 16
ARTICLE VI - EXPIRATION OF RIGHTS
6.1 Expiration of Rights . . . . . . . . . . . . . . . 17
6.2 Payment Upon Expiration of Rights. . . . . . . . . 17
6.3 Cash Payment . . . . . . . . . . . . . . . . . . . 17
6.4 Share Payment. . . . . . . . . . . . . . . . . . . 17
ARTICLE VII - RESTRICTIONS ON TRANSFER OF RIGHTS AND RIGHTS
SHARES
7.1 General Restrictions on Transfer . . . . . . . . . 18
7.2 Legend for Rights Certificates . . . . . . . . . . 18
7.3 Legend for Rights Shares . . . . . . . . . . . . . 19
7.4 Additional Restriction on Transfer of Rights . . . 20
7.5 Refusal Right. . . . . . . . . . . . . . . . . . . 20
ARTICLE VIII - DEMAND REGISTRATION RIGHT
8.1 Exercise of Demand Registration Right. . . . . . . 22
8.2 Filing of Demand Registration Statement. . . . . . 22
8.3 Obligations of Holders of Rights Shares. . . . . . 26
8.4 Delay of Demand Registration Statement . . . . . . 26
8.5 Withdrawal of Exercise of Demand
Registration Right . . . . . . . . . . . . . . . . 26
8.6 Designation of Underwriter . . . . . . . . . . . . 27
8.7 Expenses . . . . . . . . . . . . . . . . . . . . . 27
8.8 Holdback Agreements. . . . . . . . . . . . . . . . 27
ARTICLE IX - INCIDENTAL REGISTRATION RIGHTS
9.1 Notice of Incidental Registration Statement. . . . 27
9.2 Exercise of Right. . . . . . . . . . . . . . . . . 28
9.3 Obligations of Holders of Rights Shares. . . . . . 28
9.4 Limitation on Incidental Registration Rights . . . 29
9.5 Withdrawal of Exercise of Rights . . . . . . . . . 30
9.6 Withdrawal of Registration Statement . . . . . . . 30
9.7 Managing Underwriter . . . . . . . . . . . . . . . 30
9.8 Expenses . . . . . . . . . . . . . . . . . . . . . 30
ARTICLE X - INDEMNIFICATION WITH RESPECT TO REGISTRATION AND
CONTRIBUTION
10.1 Indemnification. . . . . . . . . . . . . . . . . . 31
10.2 Contribution . . . . . . . . . . . . . . . . . . . 33
10.3 Limitation of Market Activity. . . . . . . . . . . 34
ARTICLE XI - PREEMPTION RIGHTS
11.1 Notice . . . . . . . . . . . . . . . . . . . . . . 34
11.2 Preemption Rights. . . . . . . . . . . . . . . . . 34
ARTICLE XII - REPRESENTATIONS AND WARRANTIES
12.1 Representations and Warranties of R&M. . . . . . . 36
12.2 Representations and Warranties of Eagle. . . . . . 37
ARTICLE XIII - MISCELLANEOUS
13.1 Amendment. . . . . . . . . . . . . . . . . . . . . 39
13.2 Further Assurances . . . . . . . . . . . . . . . . 39
13.3 Assignability. . . . . . . . . . . . . . . . . . . 39
13.4 Counterparts; Headings . . . . . . . . . . . . . . 39
13.5 Entire Agreement . . . . . . . . . . . . . . . . . 39
13.6 Waiver . . . . . . . . . . . . . . . . . . . . . . 39
13.7 Severability . . . . . . . . . . . . . . . . . . . 40
13.8 Resolution of Disputes . . . . . . . . . . . . . . 40
13.9 Notices. . . . . . . . . . . . . . . . . . . . . . 40
13.10 Cumulative Remedies. . . . . . . . . . . . . . . . 42
13.11 Governing Law. . . . . . . . . . . . . . . . . . . 42
<PAGE>
SAR AND REGISTRATION RIGHTS AGREEMENT
THIS AGREEMENT is made this 30th day of June, 1994
between ROBBINS & MYERS, INC., an Ohio corporation ("R&M"), and
EAGLE INDUSTRIAL PRODUCTS CORPORATION, a Delaware corporation
("Eagle"), under the following circumstances:
A. R&M, Eagle and O.D.E. Manufacturing Inc. have
entered into an Amended and Restated Stock Purchase
Agreement dated as of June 29, 1994 pursuant to which
R&M has agreed to purchase the outstanding capital
stock of certain subsidiaries of Eagle and, as partial
consideration for such purchase, to issue to Eagle or
an Affiliate of Eagle certain stock appreciation rights
with respect to 2,000,000 shares (subject to adjustment
as herein provided) of the common stock of R&M.
B. R&M and Eagle now desire to set forth the
terms of, and to provide for the issuance of, such
rights.
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions. When used with initial capital
letters in the Agreement, the following terms shall have the
following meanings:
"Affiliate" means any person now or hereafter directly
or indirectly controlling, controlled by, or under common control
with a party, and includes, without limitation, any person of
which at least 20% of the voting power or equity is directly or
indirectly controlled by such party or the ultimate parent-entity
of such party.
"Associate" shall have the meaning given the term in
Rule 405 adopted under the Securities Act.
"Authorized Employee Plan" means any plan adopted by
R&M prior to May 26, 1994 pursuant to which Shares may be issued
to employees or directors of R&M or any Affiliate of R&M,
provided, however, any amendment to such a plan that would
increase the number of Shares authorized for issuance under such
a plan, excluding an amendment pursuant to the terms of the Plan
existing on May 26, 1994 to reflect an adjustment for Share
dividends, splits, or similar dilutive corporate events, shall
not be deemed to increase the number of authorized Shares for
purposes of this Agreement; a list of such plans and the maximum
number of Shares that may be issued under each such plan (subject
to adjustment in accordance with the terms of the plan) is
attached as Exhibit B.
"Base Price" means $23 per Share, subject to adjustment
as provided in Article V.
"Beneficially Owned" means, with respect to any
securities and any person: (i) such securities which are owned,
directly or indirectly, by the person or by any of the person's
Affiliates or Associates, (ii) such securities which the person
or any of the person's Affiliates or Associates has (A) the right
to acquire (whether such right is exercisable immediately or only
after the p!ssage of time) pursuant to any agreement, arrangement
or understanding, or upon the exercise of conversion rights,
exchange rights, rights, warrants or options, or otherwise or (B)
the right to vote pursuant to any agreement, arrangement or
understanding (whether or not in writing) unless the agreement,
arrangement or understanding to vote such security (1) arises
solely from a revocable proxy or consent given in response to a
public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable rules and regulations of the
Exchange Act and (2) is not also then reportable by such person
on Schedule 13D under the Exchange Act; or (iii) such securities
which are Beneficially Owned, directly or indirectly, by any
other person with which such person or any of such person's
Affiliates or Associates has any agreement, arrangement or
understanding (whether or not in writing) for the purpose of
acquiring, holding, voting (except as described in clause B of
the foregoing clause (ii)) or disposing of the securities that
are Beneficially Owned.
"Block of Rights" means 100,000 whole Rights, subject
to adjustment as provided in Article V.
"Business Day" means any day, other than a Saturday,
Sunday or day on which banking institutions in the State of Ohio
are authorized or obligated by law or executive order to close.
"Cash Payment" is defined in Section 3.2.
"Closing" means the closing of the transactions
contemplated by the Stock Purchase Agreement.
"Closing Date" means the date on which the Closing
occurs.
"Credit Agreement" means the Credit Agreement among R&M
and certain of its subsidiaries as Borrowers, Bank One, Dayton,
NA, as Agent, and Bank One, Dayton, NA and National City Bank,
Columbus, as Banks, entered into in June 1994 and any agreement
providing for the refunding or refinancing of indebtedness under
such Credit Agreement.
"Demand Registration Right" means the right of the
holders of Rights Shares to require R&M to file a Demand
Registration Statement, as described in Article VIII.
"Demand Registration Statement" means a registration
statement filed with the SEC under the Securities Act on Form S-
1, S-2 or S-3 (or similar successor form) with respect to the
offering of Rights Shares for cash.
"Disposition" is defined in Section 7.5(a).
"Disputed Matter" is defined in Section 13.8.
"Eagle" means Eagle Industrial Products Corporation, a
Delaware corporation.
"Exchange Act" means the Securities Exchange Act of
1934, as amended.
"Exercise Date" is defined in Section 3.1.
"Exercise Payment" is defined in Section 3.2.
"Expiration Date" means June 30, 2000.
"Expiration Payment" is defined in Section 6.2.
"Incidental Registration Right" means the right of the
holders of Rights Shares to require R&M to include Rights Shares
in an Incidental Registration Statement, as described in Article
IX.
"Incidental Registration Statement" means a
registration statement filed with the SEC under the Securities
Act on Form S-1, S-2 or S-3 (or similar successor form) with
respect to the offering of Shares for cash on either a best-
efforts or firm-commitment basis, whether or not the offering is
for R&M's own account. An "Incidental Registration Statement"
does not include a registration statement with respect to Shares
(i) issued as payment in connection with any acquisition of all
or any part of a business to any seller of a business, (ii)
issued in exchange for other securities of R&M or any other
person, (iii) issued or issuable upon the exercise of stock
options or warrants, (iv) issued or issuable upon conversion of
any convertible securities, or (v) issued or issuable in
connection with any employee benefit plan of R&M or any
subsidiary.
"Indemnified Claim" is defined in Article X.
"Indemnified Party" is defined in Article X.
"Indemnifying Party" is defined in Article X.
"Independent Appraiser" means a person or firm
experienced in the valuation of the type of property to be valued
and if the parties hereto do not agree on the selection of one
appraiser, then R&M shall select one appraiser and the holders of
at least a majority of Rights or Rights Shares, as the case may
be, involved in the particular determination of value shall
select another appraiser and the two selected appraisers shall
select a third; when three appraisers are employed, the
arithmetic average of appraised values set forth in the reports
of the three appraisers shall be determined, the appraised value
which differs most from such arithmetic average shall no longer
be considered, and then the arithmetic average of the two
remaining appraised values shall be determined, with the result
being the value as determined by the Independent Appraiser for
purposes of this Agreement.
"Market Value" means the last sale price of a Share on
the last trading day immediately preceding the date as of which
Market Value is being determined, as reported on The NASDAQ, Inc.
National Market System; or if no sales take place on such date,
the average of the reported closing bid and asked prices on such
date as reported on such system; or if the Shares no longer are
traded on such system, as reported on such other trading system
or exchange as may constitute the principal market for the
Shares; or if the Shares no longer are traded on any trading
system or exchange, then Market Value shall be determined by the
Independent Appraiser.
"Maximum Spread" means $17 per Share, subject to
adjustment as provided in Article V.
"Maximum Spread Price" means $40 per Share, subject to
adjustment as provided in Article V.
"MHM" means M.H.M. Co., Ltd., an Ohio limited
partnership, whose address is 830 Hanna Building, Cleveland, Ohio
44115.
"Number Adjustment Fraction" is defined in Section
5.2(a).
"Other Securities" means shares of capital stock (other
than Shares) or other securities of R&M or any other person which
are issued by R&M or any successor upon the exercise of Rights in
lieu of or in addition to Shares, in accordance with Article V.
"Payment Date" means the date on which payment for
Rights is to be made pursuant to Section 3.2 or Section 6.2.
"Preemption Right" means the right provided for in
Article XI.
"Preemption Transaction" means the offer or sale for
cash or any other consideration by R&M of (i) any unissued
Preferred Shares; (ii) any securities convertible, either
directly or indirectly and with or without consideration, into
Preferred Shares ("Preferred Convertible Securities"); or (iii)
any rights, options or warrants to purchase any Preferred Shares
or Preferred Convertible Securities.
"Preemption Transaction Notice" means a written notice
by R&M of a proposed Preemption Transaction, which shall set
forth the terms and conditions of such transaction.
"Preferred Shares" means any capital shares of R&M that
have a preference over the Shares in the payment of dividends or
distributions on dissolution.
"Price Adjustment Fraction" is defined in Section
5.2(a).
"R&M" means Robbins & Myers, Inc., an Ohio corporation.
"Redemption Date" is defined in Section 4.1.
"Redemption Notice" is defined in Section 4.1.
"Redemption Payment" is defined in Section 4.1.
"Refusal Right" is defined in Article VIII.
"Rights" means the stock appreciation rights issued
pursuant to Article II.
"Rights Certificate" is defined in Section 2.2.
"Rights Shares" means all Shares and/or Other
Securities issued upon the exercise of Rights and all Shares
and/or Other Securities into which such Shares may be converted,
for which they may be exchanged or which may be issued with
respect thereto, whether incident to a stock dividend, stock
split, stock combination, merger, consolidation or other
reorganization.
"SEC" means the United States Securities and Exchange
Commission.
"Securities Act" means the Securities Act of 1933, as
amended.
"Share Payment" is defined in Section 3.2.
"Shares" means the Common Shares, without par value, of
R&M.
"Spread" means the amount, if any, by which the average
of the Market Value of a Share on each of the first 10 of the
last 15 trading days prior to the date of determination exceeds
the Base Price per Share; provided, however, that unless
otherwise expressly provided, the Spread shall never exceed the
Maximum Spread.
"Stock Purchase Agreement" means the Stock Purchase
Agreement dated as of May 26, 1994 between R&M, Eagle and O.D.E.
Manufacturing Inc.
"Subordinated Notes" means the $50,000,000 Senior
Subordinated Extendible Exchangeable Reset Notes issued by R&M in
June 1994 or any notes issued in place of, or in exchange for,
such notes.
"Transfer Notice" is defined in Section 7.5.
"Triggering Event" means the occurrence of any of the
following events: (i) any "person" (as defined in Section 13(d)
of the Exchange Act), other than R&M, an entity then controlled
by R&M, or MHM is or becomes the beneficial owner, directly or
indirectly, of securities of R&M representing 20% or more of the
combined voting power of the then outstanding securities of R&M,
without considering any voting securities of R&M which such
person acquired directly from R&M (other than pursuant to a stock
dividend or split); (ii) any "person" (as defined in Section
13(d) of the Exchange Act), other than R&M, an entity then
controlled by R&M, or MHM is or becomes the beneficial owner,
directly or indirectly, of securities of R&M representing 35% or
more of the combined voting power of R&M's then outstanding
securities, including all securities such person acquired
directly from R&M; (iii) during any period of two consecutive
years, individuals who at the beginning of such period were
directors of R&M cease for any reason to constitute at least a
majority of the directors of R&M unless the election, or the
nomination for the election by R&M's shareholders, of each new
director was approved by a vote of at least two-thirds of the
directors then still in office who were directors at the
beginning of the period; (iv) R&M merges or consolidates with
another corporation or entity and R&M, or an entity controlled by
R&M immediately prior to the merger or consolidation, is not the
surviving entity in the merger or consolidation, or if R&M or
such an entity is the surviving entity in the merger or
consolidation, holders of 80% or more of the voting power of R&M
immediately prior to the merger or consolidation do not own,
immediately after the merger or consolidation, 65% or more of the
voting power of the surviving entity; (v) a sale, lease, exchange
or other disposition of all or substantially all of R&M's assets;
or (vi) a liquidation or dissolution of R&M.
ARTICLE II
ISSUANCE OF RIGHTS; RIGHTS CERTIFICATES
2.1 Initial Issuance of Rights. At the Closing, R&M
shall issue 2,000,000 Rights to Eagle and shall execute and
deliver to Eagle or an Affiliate of Eagle one or more Rights
Certificates, registered in the name of Eagle or an Affiliate of
Eagle, evidencing the Rights so issued. At least five days prior
to the Closing Date, Eagle shall notify R&M in writing of the
number of Rights Certificates Eagle desires to have delivered to
it or an Affiliate of Eagle at the Closing and the number of
Rights to be evidenced by each such Rights Certificate, which
shall be in increments of a whole Block of Rights and shall
aggregate 2,000,000 Rights.
2.2 Rights Certificates. The Rights issued under this
Agreement shall be evidenced by one or more separate certificates
("Rights Certificates") in substantially the form of Exhibit A to
this Agreement. The Rights Certificates may have such marks of
identification or designation and such other legends, summaries
or endorsements printed thereon as R&M deems appropriate and as
are not inconsistent with the provisions of this Agreement, or as
may be required to comply with any law or any rule or regulation
adopted thereunder. Subject to the provisions of Section 5.6,
all Rights Certificates, whenever issued, shall be dated as of
the Closing Date; provided, however, that Rights Certificates
evidencing Rights transferred or issued after the Closing Date
also may be dated to reflect the date of transfer or issuance.
Each Rights Certificate shall state on its face the number of
Rights evidenced by such certificate, which shall be in
increments of a whole Block of Rights.
2.3 Execution and Registration of Rights Certificates.
(a) Each Rights Certificate shall be executed on behalf of R&M
by its Chairman of the Board, President or any Vice President and
by its Secretary, Treasurer or any Assistant Secretary.
(b) R&M shall keep books for registration and transfer
of Rights Certificates issued pursuant to this Agreement at its
principal executive office. Such books shall show for each
outstanding Rights Certificate: (i) the name and address of the
registered holder of the certificate, (ii) the number of Rights
evidenced by the certificate, (iii) the date of issuance of the
certificate, and (iv) the certificate number of the certificate.
The Company will not at any time prior to the sixth business day
after the Expiration Date, except upon the dissolution,
liquidation or winding up of the Company, close such books so as
to result in preventing or delaying the exercise or transfer of
Rights to the extent provided herein.
(c) For all purposes whatsoever, R&M may treat the
person in whose name a Rights Certificate is registered as the
owner of the Rights Certificate and the Rights evidenced by the
Rights Certificate, notwithstanding any notice to the contrary.
2.4 Exchanges and Transfers of Rights Certificates.
At any time after the Closing and prior to the Expiration Date,
the registered holder of any Rights Certificate may surrender the
Rights Certificate to R&M, in person or by duly authorized
attorney, for transfer or for split up or combination with or
exchange for another Rights Certificate or Rights Certificates.
Any registered holder desiring to transfer a Rights Certificate
shall surrender the Rights Certificate to R&M with the attached
form of assignment (or enclose with such Rights Certificate a
written instrument of transfer in form reasonably satisfactory to
R&M), duly executed by the registered holder or his attorney duly
authorized in writing, and with the signature duly guaranteed.
Any registered holder desiring to split up, combine or exchange
any Rights Certificate shall deliver a written request to that
effect to R&M, together with the Rights Certificate(s) to be
split up, combined or exchanged. Upon receipt of any such Rights
Certificate(s) and assignment or request for split up,
combination or exchange in form reasonably satisfactory to R&M,
R&M shall prepare and execute a Rights Certificate or Rights
Certificates as so requested and deliver such certificate(s) to
the registered holder or the designated transferee. R&M may
require that the registered holder of the Rights Certificate(s)
surrendered pay any tax or other governmental charge that may be
imposed in connection with the action to be taken but shall not
require any additional service charge or other fee from the
registered holder in connection with such action being taken.
2.5 Lost, Stolen, Destroyed or Mutilated Rights
Certificates. Upon receipt by R&M of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation
of a Rights Certificate and of indemnity or security reasonably
satisfactory to it and reimbursement of all reasonable expenses
of R&M incidental thereto, R&M shall execute and deliver a new
Rights Certificate of like tenor to the registered owner to
replace the Rights Certificate so lost, stolen, destroyed or
mutilated.
ARTICLE III
EXERCISE OF RIGHTS
3.1 Exercise. (a) During the period commencing on
January 1, 1995 and ending on the Expiration Date, a registered
holder of Rights may exercise such Rights, in whole or in part
(but only in increments of a whole Block of Rights or the
remaining Rights held by a person holding less than a Block of
Rights), at any time or from time to time, by surrendering the
Rights Certificate(s) evidencing the Rights to be exercised to
R&M with the exercise form on the Rights Certificate(s) completed
and duly executed (with the signature guaranteed). No Rights may
be exercised prior to January 1, 1995 or after the Expiration
Date. The exercise will be deemed to have been made on the date
that the registered holder delivers the Rights Certificate(s)
with the exercise form duly completed and delivered (the
"Exercise Date") to R&M in accordance with Section 13.9 of this
Agreement provided the date R&M actually receives the exercise
form is within five days of the date the registered holder
executed the exercise form. If any of the payment for the Rights
is to be made to anyone other than the registered holder, the
exercise form shall be completed to show the name, address, and
identification number or social security number of the person or
persons to whom payment is to be made.
(b) Effective upon the Exercise Date, the Rights being
exercised shall terminate and thereafter shall represent only the
right to receive the Exercise Payment on the Payment Date. Upon
any partial exercise of the Rights evidenced by a Rights
Certificate, R&M will issue and deliver to or upon the order of
the registered holder of the Rights a new Rights Certificate
evidencing the remaining unexpired Rights evidenced by the Rights
Certificate which was surrendered.
(c) Notwithstanding anything in this Article III to
the contrary, no Rights may be exercised after a Redemption
Notice has been given by R&M.
3.2 Payment for Rights; Method of Payment. Upon any
exercise of Rights, R&M shall pay to the registered holder of the
Rights being exercised or such person's assignee an amount (the
"Exercise Payment") equal to the number of Rights being exercised
multiplied by the Spread calculated as of the Exercise Date. The
Exercise Payment shall be made, at R&M's sole discretion, by (i)
paying the Exercise Payment in cash (a "Cash Payment"), or (ii)
issuing or transferring a number of Shares (a "Share Payment"),
rounded up to the nearest whole Share, determined by dividing
the Exercise Payment by the Market Value of a Share on the
Exercise Date, or (iii) making a combination of a Cash Payment
and a Share Payment yielding the same aggregate amount as the
Exercise Payment. As soon as practicable, R&M shall notify the
registered holder of the Rights being exercised as to whether R&M
will make the Exercise Payment with a Cash Payment, a Share
Payment or a combination of both, and shall state the amount of
cash and/or the number of Rights Shares to be issued, a schedule
showing how the Exercise Payment was calculated, and the Payment
Date on which payment will be made (which shall be not later than
10 Business Days after the Exercise Date). Notwithstanding the
foregoing, however, if any Rights are exercised prior to June 30,
1995, R&M may defer making the Exercise Payment (the amount of
which, nevertheless, shall be calculated as of the Exercise
Date) until a later date selected by R&M, which shall be not
later than June 30, 1995.
3.3 Cash Payment. If all or any portion of an
Exercise Payment is to be made by a Cash Payment, on the Payment
Date R&M shall cause the amount of cash (less any amount R&M is
required by law to withhold from such payment) to be paid by wire
transfer of immediately available funds to the account specified
by the registered holder of the Rights.
3.4 Share Payment. If all or any portion of an
Exercise Payment is to be made by a Share Payment, on the Payment
Date R&M shall cause to be issued in the name of, and delivered
to, the registered holder of the Rights, or as such holder
otherwise has directed, a certificate or certificates for the
number of fully-paid and non-assessable Shares as constitute the
Share Payment (less any amount R&M is required to withhold from
such payment), with each certificate dated as of the Exercise
Date. Each certificate so delivered shall be in such authorized
denomination as may be requested by the registered holder of the
Rights that were exercised and shall bear any legend required by
Article VII.
3.5 Payment Following Triggering Event.
Notwithstanding any other provision of this Agreement to the
contrary, if Rights are exercised within 30 days after the
occurrence of a Triggering Event or if a Triggering Event occurs
after exercise but before payment, R&M shall make the Exercise
Payment with a Cash Payment only (and not with a Share Payment or
a combination of a Cash Payment and a Share Payment); provided,
however, if at the time such Cash Payment is required to be made
pursuant to this Section 3.5, R&M is not permitted under the
terms of the Credit Agreement or the Subordinated Notes to make
such Cash Payment, then a Share Payment shall be made; provided,
however, any person who exercised his SARs anticipating a Cash
Payment on account of a Triggering Event may, within two business
days after receiving actual notice from R&M that a Share Payment
rather than a Cash Payment will be made, revoke his exercise and
such exercise shall be deemed of no force and effect.
Immediately after R&M has actual knowledge of the occurrence of a
Triggering Event, R&M shall give notice to holders of SARs that a
Triggering Event has occurred and shall advise such holders,
based on information then available to R&M, whether Cash Payments
or Share Payments would be made if the holder exercised his SARs
within 30 days after the occurrence of a Triggering Event.
3.6 Purchase and Sale of Shares by R&M or an
Affiliate. In the event R&M intends to purchase or sell Shares
in a public trading system or exchange (other than pursuant to an
offering registered under the Securities Act) or R&M has
knowledge that an Affiliate of R&M intends such a purchase or
sale (other than pursuant to SEC Rule 144) then, R&M shall give
written notice of any such intended purchase or sale transaction
to Eagle at least five days prior to the execution of any such
transaction, unless Eagle waives in writing the requirement of
the giving of such notice. Eagle shall be entitled at any time
to request and receive information concerning R&M's purchases and
sales of Shares or present intention with respect to the same.
ARTICLE IV
REDEMPTION OF RIGHTS
4.1 Redemption. If the average Market Value of a
Share during any period of 20 consecutive trading days after
December 31, 1994 equals or exceeds the Maximum Spread Price,
R&M, within five Business Days after the end of any such 20-day
period, may redeem all (and not less than all) of the outstanding
Rights by giving written notice of the redemption (a "Redemption
Notice") to each registered holder of Rights. On the date
specified in the Redemption Notice (the "Redemption Date"), which
shall be within five Business Days after the Redemption Notice is
given, R&M shall redeem the outstanding Rights by paying an
amount to each registered holder of such Rights equal to the
number of Rights held by such holder multiplied by the Maximum
Spread (the "Redemption Payment"). The Redemption Payment shall
be made, in R&M's sole discretion, by (i) making a Cash Payment
equal to the Redemption Payment, or (ii) issuing a Share Payment
(rounded up to the nearest whole Share) determined by dividing
the Redemption Payment by the Maximum Spread Price, or (iii)
making a combination of a Cash Payment and a Share Payment
yielding the same aggregate amount as the Redemption Payment.
4.2 Cash Payment. If all or any portion of the
Redemption Payment is to be made by a Cash Payment, on the
Redemption Date R&M shall cause the amount of cash (less any
amount R&M is required by law to withhold from such payment) to
be paid by wire transfer of immediately available funds to the
account specified by the registered holder of the Rights.
4.3 Share Payment. If all or any portion of the
Redemption Payment is to be made by a Share Payment, on the
Redemption Date R&M shall cause to be issued in the name of, and
delivered to, the registered holder of the Rights, a certificate
or certificates for the number of fully-paid and non-assessable
Shares as constitute the Share Payment (less any amount R&M is
required by law to withhold from such payment), with each
certificate dated as of the Redemption Date. Each certificate so
delivered shall be in such authorized denomination as may be
requested by the registered holder of the Rights and shall bear
any legend required by Article VII.
4.4 Effectiveness of the Redemption. Effective on the
Redemption Date and the making of the Redemption Payment, all
outstanding Rights shall terminate and be of no further force and
effect.
ARTICLE V
ADJUSTMENT OF RIGHTS
5.1 Adjustment. The outstanding Rights, the Base
Price, the Maximum Spread, the Maximum Spread Price and the
number of Rights constituting a Block of Rights shall be adjusted
from time to time as provided in this Article V.
5.2 Adjustment Upon Issuance or Sale of Additional
Shares. (a) If R&M issues or sells any Shares, other than
pursuant to an Authorized Employee Plan, for no consideration or
for a consideration per Share that is less than the Market Value
of a Share immediately prior to the issuance or sale, the
outstanding Rights, the Base Price, the Maximum Spread, the
Maximum Spread Price and the number of Rights constituting a
Block of Rights shall be adjusted as follows:
(i) Each outstanding Right shall be adjusted to
be a number of Rights determined by multiplying 1 by
the Number Adjustment Fraction (calculated as hereafter
provided). The number of Rights constituting a Block
of Rights shall be adjusted to be equal to the number
of Rights which, prior to the issuance or sale,
constituted a Block of Rights, multiplied by the Number
Adjustment Fraction. The Base Price, the Maximum
Spread and the Maximum Spread Price shall be adjusted
by multiplying the amounts which, prior to the issuance
or sale, were the Base Price, the Maximum Spread and
the Maximum Spread Price, respectively, by the Price
Adjustment Fraction (calculated as hereafter provided).
(ii) The "Number Adjustment Fraction" for an
adjustment shall be a fraction, the numerator of which
is the Market Value of a Share immediately prior to the
issuance or sale of the additional Shares for which the
adjustment is being made, multiplied by the number of
Shares outstanding immediately after the issuance or
sale, and the denominator of which is the sum of: (A)
the Market Value of a Share immediately prior to the
issuance or sale, multiplied by the number of Shares
outstanding immediately prior to the issuance or sale,
and (B) the price, if any, at which the additional
Shares are being issued or sold, multiplied by the
number of additional Shares being issued or sold. The
"Price Adjustment Fraction" for an adjustment shall be
the reciprocal of the Number Adjustment Fraction.
(b) For purposes of making adjustments pursuant to
Section 5.2(a), the following provisions shall apply:
(i) If the additional Shares are issued or sold
for cash, the consideration received by R&M for
purposes of the adjustment shall be deemed to be the
net cash proceeds received by R&M for such Shares after
deducting all commissions paid by R&M in connection
with the issuance or sale, including all underwriter's
discount, concession, or reallowance.
(ii) If the additional Shares are issued or sold
for consideration other than cash (and other than upon
conversion or exchange of other securities of R&M), the
consideration received by R&M for purposes of the
adjustment shall be deemed to be the value of such
consideration, as reasonably determined by the Board of
Directors of R&M.
(iii) If the additional Shares are issued as a
dividend, the aggregate number of Shares issued in
payment of such dividend shall be deemed, for purposes
of the adjustment, to have been issued on the day
following the record date for determination of the
shareholders entitled to receive the dividend.
(iv) If R&M issues or sells any options or rights
to subscribe (other than the Rights and other than
options or rights granted under an Authorized Employee
Plan) that are exercisable for a consideration per
Share that is less than the Market Value of a Share on
the date immediately prior to the issuance or sale of
such options or rights, the issuance or sale of such
options or rights shall be deemed, for purposes of the
adjustment, to be the issuance at such time of the
maximum number of Shares that may be acquired upon
exercise of such options or rights (whether or not then
exercisable) at the consideration per Share, if any,
that is payable thereunder plus the consideration, if
any that R&M received for such options or rights.
(v) If R&M issues or sells any securities (other
than options or rights) that are convertible into or
exchangeable for Shares at a consideration per Share
that is less than the Market Value of a Share on the
date immediately prior to the issuance or sale of such
securities, the issuance or sale of such securities
shall be deemed, for purposes of the adjustment, to be
the issuance at such time of the maximum number of
Shares that may be acquired upon conversion or exchange
of such securities (whether or not then convertible or
exchangeable) for consideration equal to the net
consideration received by R&M for such securities after
deducting all commissions (including all underwriter's
discount, concession, or reallowance) paid by R&M in
connection with the issuance or sale of such securities
plus the consideration, if any, to be received by R&M
upon the exchange or conversion.
(vi) Upon expiration of any options or rights to
subscribe or termination of any right to convert or
exchange for which an adjustment was made upon issuance
or sale under this Section 5.2, another adjustment
shall be made in order to eliminate the effect of the
earlier adjustment as it related to those options,
rights to subscribe, conversion rights or exchange
rights that terminated or expired unexercised.
(vii) The number of Shares outstanding shall not
include, for purposes of the adjustment, any Shares
held in R&M's treasury or any Shares which may be
issued or sold upon the exercise of options or other
rights heretofore or hereafter granted under an
Authorized Employee Plan, but shall include the
aggregate number of Shares deliverable upon the
exercise of all other outstanding options, rights to
subscribe (other than the Rights) and other securities
that are convertible into or exchangeable for Shares
(whether or not then exercisable).
5.3 Adjustment Upon Subdivision or Combination of
Shares. If R&M at any time subdivides the Shares, the
outstanding Rights and the number of Rights constituting a Block
of Rights thereupon shall be proportionately increased and the
Base Price, the Maximum Spread and the Maximum Spread Price
thereupon shall be proportionately decreased. If R&M at any time
combines the Shares, the outstanding Rights and the number of
Rights constituting a Block of Rights thereupon shall be
proportionately decreased and the Base Price, the Maximum Spread
and the Maximum Spread Price thereupon shall be proportionately
increased.
5.4 Effect of Reorganization, Reclassification,
Consolidation or Merger. (a) If a capital reorganization or
reclassification of the capital stock of R&M, a consolidation,
merger or share exchange of R&M with another corporation or
entity or the sale of all or substantially all of R&M's assets to
another corporation is effected in such a way that holders of
Shares are entitled to receive Other Securities with respect to
or in exchange for Shares, then the Market Value of a Share for
purposes of this Agreement thereafter shall be the sum of (i) the
Market Value of a Share, if the Shares were not given up by the
holders in such reorganization, reclassification, consolidation,
merger or share exchange, and (ii) the value of the Other
Securities (after issuance of the same) to which the holder of a
Share was entitled to receive in such reorganization,
reclassification, consolidation, merger or share exchange and, as
a condition of such reorganization, reclassification,
consolidation, merger, share exchange or sale, lawful and
adequate provision shall be made so that if R&M (or its
successor) thereafter makes a Share Payment with respect to the
Rights, the payment for each Right so paid shall be a combination
of Shares (if the Shares were not given up by the holders in such
reorganization, reclassification, consolidation, merger or share
exchange) and Other Securities in the same proportion as are held
after the reorganization, reclassification, consolidation,
merger, share exchange or sale with respect to each Share
outstanding immediately prior to such transaction. In any such
case, appropriate provisions shall be made with respect to the
rights and interests of the holders of the Rights to the end that
the provisions for adjustments provided for in this Article V
thereafter shall be applicable in relation to any Shares or Other
Securities thereafter deliverable upon exercise of the Rights.
(b) In the event of a merger or consolidation of R&M
with or into another corporation or entity, a share exchange of
R&M with another corporation or the sale of all or substantially
all of R&M's assets, as a result of which a number of Other
Securities of the surviving or purchasing corporation greater or
less than the number of Shares of R&M outstanding immediately
prior to such merger, consolidation, share exchange or purchase
are issuable to holders of Shares, an adjustment shall be made
under Section 5.3 in the same manner as though there were a sub-
division or combination of the outstanding Shares.
(c) R&M shall not effect any such consolidation,
merger, share exchange or sale unless, prior to the consummation
thereof, the successor corporation or entity (if other than R&M)
resulting from such consolidation or merger or the corporation
exchanging shares or purchasing such assets shall assume, by
written instrument mailed or delivered to each registered holder
of a Right at the last address of such holder appearing on the
books of R&M, the obligation to deliver to each such holder such
Other Securities to which, in accordance with the foregoing
provisions, such holder may be entitled, and, in the case of a
merger or consolidation, agrees to assume all other obligations
of R&M under this Agreement, including without limitation, the
obligations under Article 8.
5.5 Adjustment Certificate. Whenever any adjustment
is made as provided in Section 5.2, Section 5.3 or Section 5.4,
R&M shall mail to each registered holder of Rights a certificate
signed by an officer of R&M and showing in reasonable detail the
adjustment to be made, the facts requiring the adjustment and the
outstanding Rights, the number of Rights constituting a Block of
Rights, the Base Price, the Maximum Spread and the Maximum Spread
Price both before and after the adjustment. Unless at least a
majority of the holders of the Rights object to the adjustments
shown on such certificate within ten days of the holders receipt
of the same, such adjustments as shown on such certificate shall
be final for purposes of this Agreement.
5.6 Issuance of New Rights Certificates. R&M may, at
its option, issue new Rights Certificates evidencing outstanding
Rights in such form as may be approved by its Board of Directors
(which shall replace and be in lieu of the outstanding Rights
Certificates) to reflect any adjustment or change in the Rights
made in accordance with this Article V. If R&M determines to
issue new Rights Certificates in accordance with the foregoing
sentence, R&M shall so notify the registered holders of the
outstanding Rights Certificates, who then shall be required to
surrender such outstanding Rights Certificates to R&M within a
reasonable period of time after such notice, as determined by
R&M, for replacement by R&M with the new form of Rights
Certificates so approved.
5.7 Notice of Certain Events. R&M shall give to each
registered holder of Rights at least 10 days prior written notice
of the record date for (i) any dividend or other distribution
declared with respect to the Shares, (ii) any subscription rights
offered pro rata to the holders of the Shares to acquire any
additional Shares or other securities, (iii) any capital
reorganization or reclassification of R&M's capital stock or any
consolidation, merger or share exchange of R&M with, or sale of
all or substantially all of R&M's assets to, another person, or
(iv) any voluntary or involuntary dissolution, liquidation or
winding up of R&M, or (v) any action to be taken by R&M not
identified in this Section 5.7, which would require an adjustment
with respect to the Rights under Article V of this Agreement.
5.8 Other Dilutive Events. If any event shall occur
as to which the other provisions of this Article V are not
strictly applicable but the failure to make any adjustment would
not maintain the economic value of the Rights in accordance with
the essential intent and principles hereof then, in each such
case, the Independent Appraiser shall be appointed and shall give
its opinion upon the adjustment, if any, on a basis consistent
with the essential intent and principles established in this
Article V, necessary to preserve, without dilution, the economic
value of the Rights measured in terms of the fair value thereof
immediately prior to such event.
ARTICLE VI
EXPIRATION OF RIGHTS
6.1 Expiration of Rights. All Rights that have not
been exercised prior to the Expiration Date shall expire on the
Expiration Date, and thereafter shall represent only the right to
receive the Expiration Payment.
6.2 Payment Upon Expiration of Rights. Upon
expiration of the Rights pursuant to Section 6.1, R&M shall pay
to each registered holder of such Rights an amount equal to the
number of Rights held by such holder multiplied by the Spread as
of the Expiration Date (the "Expiration Payment"). The
Expiration Payment shall be made, in R&M's sole discretion, by
(i) making a Cash Payment equal to the Expiration Payment, or
(ii) issuing a Share Payment (rounded up to the nearest whole
Share) determined by dividing the Expiration Payment by the
Market Value of a Share on the Expiration Date, or (iii) making a
combination of a Cash Payment and a Share Payment yielding the
same aggregate amount as the Expiration Payment. As soon as
practicable after the Expiration Date, R&M shall notify the
registered holders of the Rights that were outstanding on such
date as to whether R&M will make the Expiration Payment with a
Cash Payment, a Share Payment or a combination of both, and shall
state the amount of cash and/or the number of Rights Shares to be
issued, state in reasonable detail how the Expiration Payment was
calculated and the Payment Date, which shall be within 10
Business Days after the Expiration Date.
6.3 Cash Payment. If all or any part of the
Expiration Payment is to be made by a Cash Payment, on the
Payment Date R&M shall cause the amount of cash (less any amount
R&M is required by law to withhold from such payment) to be paid
by wire transfer of immediately available funds to the account
specified by the registered holder of the Rights.
6.4 Share Payment. If all or any portion of the
Expiration Payment is to be made by a Share Payment, on the
Payment Date R&M shall cause to be issued in the name of, and
delivered to, the registered holder of the Rights, a certificate
of certificates for the number of fully-paid and non-assessable
Shares as constitute the Share Payment (less any amount R&M is
required to withhold from such payment), with each certificate
dated as of the Expiration Date. Each certificate so delivered
shall be in such authorized denomination as may be requested by
the registered holder of the Rights and shall bear any legend
required by Article VII.
ARTICLE VII
RESTRICTIONS ON TRANSFER
OF RIGHTS AND RIGHTS SHARES
7.1 General Restrictions on Transfer. (a)
Notwithstanding any other provision of this Agreement to the
contrary, no Rights or Rights Shares may be transferred unless
all applicable conditions set forth in this Article VII are
satisfied. The provisions of this Article VII are intended,
among other things, to assure compliance with the requirements of
the Securities Act with respect to any transfers of Rights and
Rights Shares.
(b) No Rights or Rights Shares may be transferred
unless and until (i) the transfer has been duly registered under
the Securities Act and all applicable state securities laws, or
(ii) the registered holder of the Rights or the Rights Shares to
be transferred delivers, at such person's expense, a written
opinion addressed to R&M from counsel reasonably acceptable to
R&M to the effect that the proposed transfer may be effected
without registration under the Securities Act or any applicable
state securities laws. Notwithstanding the preceding sentence,
the Rights may be transferred upon the death of a holder or to a
holder's spouse or lineal descendants during the holder's
lifetime. In addition, without the consent of R&M or any opinion
of counsel, any holder of Rights or Rights Shares may transfer
all or part of the Rights or Shares to any Affiliate of such
holder or holders, to any employee of such holder or holders, to
any employee of any Affiliate of such holder or holders, to any
successor to such holder or holders by operation of law or to any
person that purchases all or substantially all the assets of such
holder or holders.
(c) The restrictions set forth in Section 7.1(b) shall
cease to apply to Rights or Rights Shares if the legend described
in Section 7.2 is not present on the Rights Certificate
evidencing the Rights or if the legend described in Section 7.3
is not present on the certificate evidencing the Rights Shares,
as the case may be, in accordance with Section 7.2 and Section
7.3, respectively.
7.2 Legend for Rights Certificates. Except as
otherwise provided in this Section 7.2, each Rights Certificate
initially issued by R&M shall bear a legend in substantially the
following form when issued:
"The securities evidenced hereby have not
been registered under the Securities Act of
1933, as amended (the "Act"), or any state
securities laws, and may not be sold or
transferred unless registered under the Act
and all applicable state securities laws or
unless an exemption from such registration
requirements is available at the time of
transfer. Transfer of the securities
evidenced hereby is subject to the
restrictions set forth in Article VII of the
SAR and Registration Rights Agreement dated
as of June 30, 1994 between Robbins & Myers,
Inc. and Eagle Industrial Products
Corporation, a copy of which will be mailed
to the holder of this certificate within five
days after a written request therefor is
delivered to Robbins & Myers, Inc., 1400
Kettering Tower, Dayton, Ohio 45423."
Any Rights Certificate issued at any time upon transfer of, or in
exchange for or replacement of, any Rights Certificate bearing
such legend also shall bear such legend unless the holder of the
Rights Certificate delivers to R&M, at such person's expense, a
written opinion addressed to R&M of counsel reasonably acceptable
to R&M to the effect that the Rights represented by such Rights
Certificate need no longer be subject to the restrictions
contained in Section 7.1(b).
7.3 Legend for Rights Shares. Each certificate
representing Rights Shares issued upon exercise of Rights shall
bear a legend in substantially the following form, unless at the
time of exercise such Rights Shares have been registered under
the Securities Act:
"The securities evidenced hereby have not
been registered under the Securities Act of
1933, as amended (the "Act"), or any state
securities laws, and may not be sold or
transferred unless registered under the Act
and all applicable state securities laws or
unless an exemption from such registration
requirements is available at the time of
transfer. Transfer of the securities
evidenced hereby is subject to the
restrictions set forth in Article VII of the
SAR and Registration Rights Agreement dated
as of June 30, 1994 between Robbins & Myers,
Inc. and Eagle Industrial Products
Corporation, a copy of which will be mailed
to the holder of this certificate within five
days after a written request therefor is
delivered to Robbins & Myers, Inc., 1400
Kettering Tower, Dayton, Ohio 45423."
Any certificate for Rights Shares issued at any time upon
transfer of, or in exchange for or replacement of, any
certificate for Rights Shares bearing such legend also shall bear
such legend unless the holder of the certificate delivers to R&M,
at such person's expense, a written opinion addressed to R&M of
counsel reasonably acceptable to R&M to the effect that the
securities represented by such certificate need no longer be
subject to the restrictions contained in Section 7.1(b).
7.4 Additional Restriction on Transfer of Rights. (a)
In addition to the restrictions on transfer of the Rights and
Rights Certificates set forth in Section 7.1(b), prior to
June 30, 2000, neither Eagle nor any Affiliate of Eagle shall
transfer any Rights or Rights Shares to any person (other than to
a person exercising the Refusal Right described in Section 7.5 or
to an Affiliate of Eagle) if, after such transfer, the aggregate
number of Shares Beneficially Owned by the transferee and the
transferee's Affiliates and Associates upon exercise of Rights
Beneficially Owned by such persons would exceed 5% of the number
of Shares then outstanding, as shown in the most recent report
filed by R&M with the SEC pursuant to the Exchange Act which
states the number of Shares outstanding (assuming, solely for
purposes of the calculation, that all of such Rights then are
exercisable and, upon exercise, R&M would issue a number of
Shares determined by multiplying the number of Rights by the
Maximum Spread and dividing the results by the Maximum Spread
Price).
(b) Each Rights Certificate and certificate evidencing
Rights Shares issued by R&M to Eagle or any Affiliate of Eagle
prior to June 30, 2000 shall bear substantially the following
legend when issued:
"Transfer of the securities evidenced hereby
is subject to certain restrictions with
respect to the persons to whom the securities
may be transferred, as set forth in Section
7.4 of the SAR and Registration Rights
Agreement dated as of June 30, 1994 between
Robbins & Myers, Inc. and Eagle Industrial
Products Corporation, a copy of which will be
mailed to the holder of this certificate
within five days after a written request
therefor is delivered to Robbins & Myers,
Inc., 1400 Kettering Tower, Dayton, Ohio
45423."
7.5 Refusal Right. (a) In addition to the other
restrictions on transfer of the Rights and Rights Shares set
forth in this Article VII, prior to June 30, 2000, neither Eagle
nor any Affiliate of Eagle shall sell, assign, pledge or
otherwise transfer (a "Disposition") any Rights or Rights Shares
to any person who is not an Affiliate of Eagle without first
delivering a written notice (the "Transfer Notice") to R&M and to
MHM at least 10 days prior to the proposed Disposition. The
Transfer Notice shall describe the proposed Disposition fully,
including the number of Rights or Rights Shares proposed to be
transferred, the proposed transfer price and the name and address
of the proposed transferee. The Transfer Notice shall be signed
by both the holder of the Rights Shares to be transferred and the
proposed transferee. R&M shall have the right (a "Refusal
Right") to purchase all of the Rights or Rights Shares subject to
the Transfer Notice on the terms and conditions of the
Disposition described in the Transfer Notice by delivering a
notice of exercise to the holder of the Rights or Rights Shares
covered by the Transfer Notice at any time within the 10-day
period after R&M actually receives the Transfer Notice; provided,
however, that if R&M does not exercise the Refusal Right within
such period, MHM may exercise the Refusal Right by delivering a
notice of exercise to the holder of the Rights or Rights Shares
covered by the Transfer Notice at any time within such 10-day
period.
(b) If R&M or MHM exercises the Refusal Right, the
holder of the Rights or Rights Shares subject to the Transfer
Notice shall transfer the Rights or Rights Shares to R&M or MHM,
as the case may be, on the same terms and conditions as the
Disposition described in the Transfer Notice; provided, however,
that if the Transfer Notice provides for payment for the Rights
or Rights Shares other than in cash at the closing, R&M or MHM
(as the case may be) shall have the option of paying the fair
market value cash equivalent (as determined by the Independent
Appraiser) of the consideration described in the Transfer Notice.
(c) If neither R&M nor MHM exercises the Refusal Right
within the periods specified in Section 7.5(a), the holder of the
Rights or Rights Shares covered by the Transfer Notice may, not
later than 180 days following the date the Transfer Notice was
delivered to R&M and MHM, conclude the Disposition described in
the Transfer Notice (subject, however, to any other restrictions
imposed by this Agreement) on the terms and conditions described
therein; provided, however, that the price at which the
Disposition is concluded may be less than the price set forth in
the Transfer Notice, but not less than 90% of such price. Any
proposed Disposition on terms and conditions different from those
set forth in the preceding sentence shall again be subject to the
Refusal Right of R&M and MHM in accordance with Section 7.5(a).
(d) Each Rights Certificate and certificate evidencing
Rights Shares issued by R&M to Eagle or any Affiliate of Eagle
prior to June 30, 2000 shall bear substantially the following
legend when issued:
"The securities evidenced hereby are subject
to a right of first refusal applicable to any
proposed sale or transfer, as set forth in
Section 7.5(a) of the SAR and Registration
Rights Agreement dated as of June 30, 1994
between Robbins & Myers, Inc. and Eagle
Industrial Products Corporation, a copy of
which will be mailed to the holder of this
certificate within five days after a written
request therefor is delivered to Robbins &
Myers, Inc., 1400 Kettering Tower, Dayton,
Ohio 45423."
ARTICLE VIII
DEMAND REGISTRATION RIGHT
8.1 Exercise of Demand Registration Right. During the
period from January 1, 1995 through December 31, 2002, the
registered holders of at least a majority of the outstanding
Rights Shares may exercise Demand Registration Rights by giving
written notice to R&M at least 40 days prior to the proposed date
of filing (but no more than one such notice involving an
underwritten offering may be given in a 15-month period if a
Demand Registration Statement becomes effective as a result of
such notice being given), setting forth the number of Rights
Shares to be included in the Demand Registration Statement and
the proposed date of filing of the Demand Registration Statement.
Upon receipt of the written notice, R&M promptly shall send a
copy of such notice to each registered holder of Rights Shares
who did not exercise the Demand Registration Right. The holders
of Rights Shares shall have three Demand Registration Rights
hereunder, which become effective under the Securities Act,
provided, however, only two of the Demand Registration Rights may
involve firm-commitment offerings (it being understood that the
other Demand Registration Right would not involve a firm
commitment underwriting).
8.2 Filing of Demand Registration Statement. Upon
exercise of the Demand Registration Right pursuant to Section
8.1, R&M shall use its best efforts to:
(a) prepare and file within 40 days a Demand
Registration Statement with respect to the Rights
Shares as to which the Demand Registration Right was
exercised together with all other Rights Shares as to
which the registered holders have requested R&M include
in the Demand Registration Statement within 15 days
after the giving of the notice by R&M referred to in
Section 8.1;
(b) cause the Demand Registration Statement to
become effective as promptly as possible;
(c) qualify the Rights Shares registered on the
Demand Registration Statement for offer and sale in
accordance with the securities laws of the
jurisdictions reasonably designated by the holders of a
majority of the Rights Shares to be registered;
(d) maintain the effectiveness of the Demand
Registration Statement and the other qualifications for
a period, not exceeding 180 (exclusive of anytime
period that effectiveness was suspended due to action
by R&M) days in the case of a firm-commitment
underwriting and as long as permitted under SEC rules
and regulations applicable to continuous offerings (but
in no event more than three years) in the case of a
best-efforts offering, during which a prospectus is
required to be delivered in connection with sales of
the Rights Shares registered on the Demand Registration
Statement;
(e) amend or supplement the Demand Registration
Statement and prospectus as necessary to comply with
the Securities Act and other applicable laws and
regulations;
(f) provide a reasonable number of copies of the
Demand Registration Statement (including exhibits),
preliminary prospectus, final prospectus and any
amendments or supplements thereto to the holders of the
Rights Shares registered on the Demand Registration
Statement, upon request;
(g) permit and facilitate the public
underwriting, offering and sale of the Rights Shares
registered on the Demand Registration Statement;
(h) cause all such Rights Shares to be listed on
each securities exchange on which similar securities
issued by R&M are then listed and to be qualified for
trading on each system on which similar securities
issued by R&M are from time to time qualified;
(i) provide a transfer agent and registrar for
all such Rights Shares not later than the effective
date of such registration statement and thereafter
maintain such a transfer agent and registrar; and
otherwise cooperate with the sellers of the Rights
Shares and the managing underwriter to facilitate the
timely preparation and delivery of certificates
representing the Rights Shares to be sold and not
bearing any restrictive legends, and enable such Rights
Shares to be in such denominations and registered in
such names as the managing underwriter may reasonably
request at least two business days prior to any sale of
Rights Shares to the underwriters;
(j) enter into such customary agreements
(including underwriting agreements in customary form)
and take all such other actions as the holders of a
majority of the Rights Shares being sold or the
underwriters, if any, reasonably request in order to
expedite or facilitate the disposition of such Rights
Shares including without limitation:
(i) making such representations and
warranties to the underwriters in form, substance
and scope, reasonably satisfactory to the managing
underwriter, as are customarily made by issuers to
underwriters in primary underwritten offerings;
(ii) obtaining opinions and updates thereof
of counsel which counsel and opinions (in form,
scope and substance) shall be reasonably
satisfactory to the managing underwriter,
addressed to the managing underwriter covering the
matters customarily covered in opinions requested
in underwritten offerings and such other matters
as may be reasonably requested by the managing
underwriter;
(iii) causing the underwriting agreements to
set forth in full the indemnification provisions
and procedures of Article X (or such other
substantially similar provisions and procedures as
are customary in offerings involving the managing
underwriter) with respect to all parties to be
indemnified pursuant to said Section; and
(iv) delivering such documents and
certificates as may be reasonably requested by the
sellers of Rights Shares to evidence compliance
with the provisions of this Section 8.2 and with
any customary conditions contained in the
underwriting agreement or other related agreement
entered into by R&M.
(k) make available for inspection by any
underwriter participating in any disposition pursuant
to such registration statement and any attorney,
accountant or other agent retained by any such
underwriter, all financial and other records, pertinent
corporate documents and properties of R&M, and cause
R&M's officers, directors, employees and independent
accountants to be available on a reasonable basis and
cooperate with such parties' "due diligence" and to
supply all information reasonably requested by any such
underwriter, attorney, accountant or agent in
connection with such registration statement;
(l) otherwise use its best efforts to comply with
all applicable rules and regulations of the SEC, and
make available to its security holders, as soon as
reasonably practicable, an earnings statement covering
the period of at least twelve months beginning with the
first day of R&M's first day of R&M's first full
calendar quarter after the effective date of
registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder;
(m) permit any holder of Rights Shares which
holder, in its sole and exclusive judgment, might be
deemed to be an underwriter or a controlling person of
R&M, to participate in the preparation of such
registration or comparable statement and to require the
insertion therein of material, furnished to R&M in
writing, which in the reasonable judgment of such
holder and its counsel should be included;
(n) make available appropriate management
personnel for participation in the preparation and
drafting of such registration or comparable statement,
for due diligence meetings and for "road show"
meetings;
(o) in the event of the issuance of any stop
order suspending the effectiveness of a registration
statement, or of any order suspending or preventing the
use of any related prospectus or suspending the
qualification of any Shares included in such
registration statement for sale in any jurisdiction,
R&M will use its reasonable best efforts promptly to
obtain the withdrawal of such order; and
(p) obtain a cold comfort letter from R&M's
independent public accountants addressed to the selling
holders of Rights Shares in customary from and covering
such matters of the type customarily covered by cold
comfort letters as the holders of a majority of the
Rights Shares being sold reasonably request.
8.3 Obligations of Holders of Rights Shares. (a)
Each holder of Rights Shares to be included in the Demand
Registration Statement filed by R&M shall provide the following
to R&M in writing:
(i) all information within the possession or knowledge
of such holder required by the applicable rules and
regulations of the SEC and any applicable state securities
laws concerning the proposed method of sale or other
disposition of the Rights Shares being registered and the
identity of and compensation to be paid to any proposed
underwriter(s) to be employed in connection therewith; and
(ii) if the Rights Shares are to be sold and
distributed over a period of time, or from time to time,
such undertaking as R&M and its counsel reasonably may
require in order to assure full compliance with the
Securities Act and the Exchange Act.
(b) If during the effectiveness of the Demand
Registration Statement, an intervening event occurs which, in the
reasonable opinion of R&M's counsel, makes the prospectus
included in the Demand Registration Statement no longer comply
with the Securities Act, R&M shall so notify the holders of the
Rights Shares registered on the Demand Registration Statement and
such holders shall make no further offers or sales or other
dispositions of Rights Shares under the Demand Registration
Statement until they receive from R&M a new, amended or
supplemented prospectus complying with the Securities Act. R&M
shall keep such holders fully informed as to the status of its
efforts to cause a new, amended or supplemented prospectus to be
made available for use by such holders.
8.4 Delay of Demand Registration Statement. R&M may
delay the filing or effectiveness of a Demand Registration
Statement for an initial period of up to 60 days after the
proposed filing date specified in the notice referred to in
Section 8.1 and thereafter may extend such delay for an
additional period of up to 30 days if (and only if), with respect
to each such delay, the Board of Directors of R&M, in the good
faith exercise of its business judgment, reasonably determines
(as set forth in a resolution of the Board of Directors) that the
filing or effectiveness of the Demand Registration Statement or
the offering of Rights Shares thereunder would have a material
adverse effect on a pending financing, acquisition, disposition
of assets or other material transaction of R&M.
8.5 Withdrawal of Exercise of Demand Registration
Right. The holders of a majority of the Rights Shares to be
registered on the Demand Registration Statement may withdraw the
exercise and cause R&M either not to file or to withdraw the
filing of a Demand Registration Statement at any time prior to
the effectiveness of the Demand Registration Statement.
8.6 Designation of Underwriter. If the offering under
the Demand Registration Statement is to be made on an
underwritten basis, the managing underwriter of the offering
shall be designated by the holders of a majority of the Rights
Shares being registered, and the terms of such underwriting shall
be mutually satisfactory to the holders of at least a majority of
the Rights Shares being registered.
8.7 Expenses. Underwriting commissions and all other
expenses (including, without limitation: (i) registration,
filing and listing fees, (ii) printing expenses, (iii) expenses
of audits or accounting services incident to such registration
that would not have otherwise been incurred, and (iv) fees and
expenses of counsel for the holders of the Rights Shares being
registered, incurred in connection with any offering or attempted
offering pursuant to a Demand Registration Statement shall be
paid by the holders of the Rights Shares being registered on a
pro rata basis, based on the respective number of Rights Shares
being registered on behalf of each such holder. R&M shall be
responsible for the fees and expenses of any counsel retained by
it.
8.8 Holdback Agreements. R&M agrees (a) not to effect
any public sale or distribution of its equity securities, or any
securities convertible into or exchangeable or exercisable for
such securities, during the 30-day period prior to and during the
90-day period beginning on the effective date of any underwritten
Demand Registration Statement, except pursuant to (i)
registrations on Form S-8 or any successor form, or (ii)
registrations on Form S-4 or any successor form (unless the
underwriters managing the registered public offering otherwise
agree), and (b) to use its reasonable efforts to obtain
agreements from its officers, directors and affiliated
shareholders (including, without limitation, each holder of more
than 5% in number or value of the outstanding Shares), to agree
not to effect any public sale or distribution (including sales
pursuant to Rule 144) of any such securities during such period
(except as part of such underwritten registration, if otherwise
permitted), unless the underwriters managing the registered
public offering otherwise agree.
ARTICLE IX
INCIDENTAL REGISTRATION RIGHTS
9.1 Notice of Incidental Registration Statement.
During the period from January 1, 1995 through December 31, 2002,
if any Rights Shares are outstanding, R&M shall notify the
registered holders of the outstanding Rights Shares at least 60
days prior to the proposed filing by R&M of any Incidental
Registration Statement.
9.2 Exercise of Right. (a) After R&M gives notice of
the proposed filing of an Incidental Registration Statement in
accordance with Section 9.1, any holders of outstanding Rights
Shares may exercise an Incidental Registration Right by notifying
R&M of the intention of such holders to include all or any of the
Rights Shares held by them in the Incidental Registration
Statement at least 30 days prior to the date R&M has proposed to
file the Incidental Registration Statement. If R&M timely
receives such notices with respect to at least a majority of the
outstanding Rights Shares, R&M shall:
(i) include the Rights Shares owned by such
holders for which notice was given in the Incidental
Registration Statement;
(ii) use its best efforts to cause the Incidental
Registration Statement to become effective with the SEC
as expeditiously as possible;
(iii) use its best efforts to qualify the Shares,
including the Rights Shares, covered by the Incidental
Registration Statement for offer and sale in accordance
with the securities laws of such jurisdictions as R&M
and the holders of at least a majority of the Rights
Shares being registered determine; and
(iv) the provisions of Section 8.2(d) through (p)
which are applicable to a Demand Registration Statement
shall also be applicable to an Incidental Registration
Statement.
The holders of Rights Shares shall have two Incidental
Registration Rights hereunder which become effective under the
Securities Act.
9.3 Obligation of Holders of Rights Shares. (a) Each
holder of Rights Shares to be included in the Incidental
Registration Statement filed by R&M shall provide the following
to R&M in writing:
(i) all information within the possession or knowledge
of such holder required by the applicable rules and
regulations of the SEC and any applicable state securities
laws concerning the proposed method of sale or other
disposition of the Rights Shares being registered and the
identity of and compensation to be paid to any proposed
underwriter(s) to be employed in connection therewith; and
(ii) if the Shares covered by the Incidental
Registration Statement, including the Rights Shares, are to
be sold and distributed over a period of time, or from time
to time, such undertaking as R&M and its counsel reasonably
may require in order to assure full compliance with the
Securities Act and the Exchange Act.
(b) If during the effectiveness of the Incidental
Registration Statement, an intervening event occurs which, in the
reasonable opinion of R&M's counsel, makes the prospectus
included in the Incidental Registration Statement no longer
comply with the Securities Act, R&M shall so notify the holders
of the Rights Shares registered on the Incidental Registration
Statement, and such holders thereafter shall make no further
offers or sales or other dispositions of Rights Shares under the
Incidental Registration Statement until they receive from R&M a
new, amended or supplemented prospectus complying with the
Securities Act. R&M shall keep such holders fully informed as to
the status of its efforts to cause a new, amended or supplemented
prospectus to be made available for use by such holders.
9.4 Limitation on Incidental Registration Rights. R&M
shall not be required to:
(a) include in any Incidental Registration
Statement any Rights Shares unless the holders of such
Rights Shares accept the terms of the underwriting as
determined by R&M and its managing underwriter; or
(b) if the Rights Shares exceed 10% of all of the
Shares (including the Rights Shares included in the
Incidental Registration Statement), include in any
Incidental Registration Statement any Rights Shares, to
the extent that such inclusion would, in the reasonable
judgment of the managing underwriter of the offering,
as set forth in a written statement to such effect,
materially and adversely affect the price of the Shares
in the offering or the amount of the proceeds of the
offering that R&M had anticipated it would receive.
In the event that the number of Shares owned by all selling
shareholders, including the Rights Shares, which may be included
in any Incidental Registration Statement is limited for any reason
(including, without limitation, the reasons specified in
subparagraphs (b) or (c) above), then Rights Shares shall be
included in the Incidental Registration Statement on a pro rata
basis (based on the number of Rights Shares specified for
inclusion by each holder of Rights Shares and the number of Shares
other than Rights Shares to be registered) with the Shares of all
other selling shareholders, if any, to be included in the
Incidental Registration Statement.
9.5 Withdrawal of Exercise of Right. The holders of at
least a majority of the Rights Shares being registered on an
Incidental Registration Statement may withdraw an exercise of the
Incidental Registration Right hereunder with respect to such
Incidental Registration Statement by giving notice of the
withdrawal at any time prior to the filing of the pricing
amendment or the mailing of a prospectus in accordance with Rule
430A with respect to the Incidental Registration Statement;
provided, however, that the holders of the Rights Shares which
were to be included in the Incidental Registration Statement shall
reimburse R&M for the reasonable expenses actually incurred by R&M
in connection with the attempted exercise and the withdrawal of
the exercise (including, without limitation, R&M's expense in
revising the Incidental Registration Statement).
9.6 Withdrawal of Registration Statement. R&M may
withdraw any Incidental Registration Statement at any time prior
to its effectiveness.
9.7 Managing Underwriter. If the offering under an
Incidental Registration Statement is to be made on an underwritten
basis, R&M shall designate the managing underwriter and, subject
to the provisions of this Agreement, the terms and conditions of
such underwriting shall be determined by R&M.
9.8 Expenses. (a) Underwriting commissions incurred
in connection with any offering pursuant to an Incidental
Registration Statement shall be paid pro rata by R&M and the
selling shareholders, including the holders of the Rights Shares
included in the Incidental Registration Statement, on the basis of
the respective numbers of Shares registered on such Incidental
Registration Statement.
(b) All other expenses incurred in connection with any
offering pursuant to an Incidental Registration Statement shall be
paid by R&M including, without limitation: (i) registration,
filing and listing fees, (ii) printing expenses, (iii)
underwriting commissions or fees (except as otherwise provided in
Section 9.8(a)), (iv) expenses of audits or accounting services
incident to such registration, and (v) fees and expenses of
counsel for R&M, except that the holders the Rights Shares
included on the Incidental Registration Statement shall be
responsible for (A) the fees and expenses of any counsel retained
by them, and (B) their pro rata share of any expenses incurred in
any jurisdiction in which the offering is qualified that requires
the expenses incurred in so qualifying the offering be borne by
the selling shareholder under the circumstances of the offering.
ARTICLE X
INDEMNIFICATION WITH RESPECT TO
REGISTRATION AND CONTRIBUTION
10.1 Indemnification. (a) To the extent permitted by
law, R&M and each selling shareholder, including each holder of
Rights Shares included in a Demand Registration Statement or an
Incidental Registration Statement (a "Selling Shareholder"), shall
indemnify: (i) R&M, (ii) each Selling Shareholder, and (iii) each
person who is deemed to "control" R&M and each Selling Shareholder
under the Securities Act including, without limitation, any
officer or director of R&M and any other Selling Shareholder who
signs an Incidental Registration Statement in such capacity
(collectively, a "Controlling Person") (R&M, each such Selling
Shareholder and each such Controlling Person hereinafter sometimes
is referred to individually as an "Indemnified Party") from and
against any losses, claims, damages or liabilities (but not
amounts paid in settlement of any such loss, claim, damage or
liability if such settlement is effected without the consent of
the Indemnifying Party, which consent may not be unreasonably
withheld) (collectively, "Indemnified Claims"), insofar as such
Indemnified Claims arise out of, or are based upon:
(1) any untrue statement or alleged untrue
statement of a material fact contained in any
Incidental Registration Statement or Demand
Registration Statement, related prospectus or
preliminary prospectus, or any amendment or supplement
thereto (collectively, "Offering Documents"); or
(2) the omission or alleged omission to state in
any Offering Documents a material fact required to be
stated in any Offering Documents or necessary to make
the statements in any Offering Documents not
misleading,
and shall reimburse each other Indemnified Party for any legal or
other expenses reasonably incurred by any such Indemnified Party
in investigating, preparing to defend or defending any such
Indemnified Claim, provided that:
(1) R&M shall not be liable to any Indemnified
Party to the extent that any such Indemnified Claim
arises out of or is based upon any untrue statement,
alleged untrue statement, omission or alleged omission
made in reliance upon written information furnished to
R&M by such Indemnified Party for inclusion in any
Offering Documents;
(2) each Selling Shareholder shall be liable for
any Indemnified Claim only to the extent that such
Indemnified Claim arises out of or is based upon any
untrue statement, alleged untrue statement, omission or
alleged omission made in reliance upon written
information furnished to R&M by such Selling
Shareholder for inclusion in any Offering Documents;
and
(3) the indemnity and reimbursement provided for
in this subdivision shall be in addition to any
liability which any Indemnified Party may otherwise
have to any other Indemnified Party.
(b) If any Indemnified Party receives notice of an
Indemnified Claim, it shall promptly give notice of such
Indemnified Claim to each other Indemnified Party against whom it
proposes to make a claim for indemnity or reimbursement with
respect to such Indemnified Claim ("Indemnifying Party"). The
failure of any Indemnified Party to promptly notify an
Indemnifying Party of an Indemnified Claim shall not relieve the
Indemnifying Party of any liability which it may have to such
Indemnified Party in connection with such Indemnified Claim,
except to the extent such failure adversely affects the ability
of the Indemnifying Party to defend, settle or satisfy the claim.
(c) Each Indemnifying Party shall be entitled to
participate with the Indemnified Parties in the defense of any
Indemnified Claim.
(d) If a lawsuit or other proceeding or investigation
is brought against an Indemnified Party and such Indemnified
Party notifies the Indemnifying Parties of the commencement
thereof, the Indemnifying Parties shall be entitled to
participate therein and, to the extent that it shall choose,
assume the defense thereof, with counsel satisfactory to such
Indemnified Party, and, after notice from the Indemnifying
Parties to such Indemnified Party of their election so to assume
the defense thereof, the Indemnifying Parties shall not be liable
to such Indemnified Party under these indemnification provisions
for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by such Indemnified Party, in
connection with the defense thereof other than reasonable costs
of investigation; provided that if (i) the Indemnifying Parties
shall have failed to assume the defense of such action or
proceeding or shall have failed to employ counsel reasonably
satisfactory to such Indemnified Party in any action or
proceeding; or (ii) the named parties to any such action or
proceeding include both such Indemnified Party and the
Indemnifying Parties, and such Indemnified Party shall have been
advised by counsel in writing (with a copy to the Indemnifying
Parties) that there may be one or more defenses available to such
Indemnified Party which are different from or additional to those
available to the Indemnifying Parties or if counsel faces a
conflict of interest representing both Indemnified and
Indemnifying Parties, then, in either case, if the Indemnified
Party notifies the Indemnifying Parties in writing that it elects
to employ separate counsel, such separate counsel shall be at the
expense of the Indemnifying Parties and the Indemnifying Parties
shall not have the right to assume the defense of such action or
proceeding on behalf of such Indemnified Person. The
Indemnifying Parties shall reimburse such expenses as they are
incurred. In any event, unless there exists a conflict among
Indemnified Parties, the Indemnifying Parties shall not, in
connection with any one such action or proceeding or separate but
substantially similar or related actions or proceedings in the
same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than
one separate firm of attorneys at any time for all such
Indemnified Parties. The Indemnifying Parties will not be
subject to any liability for any settlement made without their
consent. No Indemnifying Party shall, without the consent of the
Indemnified Party, consent to entry of any judgment or enter into
any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to
such claim or litigation.
10.2 Contribution. (a) In order to provide for the
just and equitable contribution in circumstances under which the
indemnity provided for in this Article X is for any reason held
to be unenforceable by the Indemnified Parties though applicable
in accordance with its terms, each applicable Indemnifying Party,
in lieu of indemnifying such Indemnified Party, shall contribute
to the amount paid or payable by such Indemnified Party as a
result of any losses, claims, damages, liabilities or expenses of
a nature contemplated by such indemnity in such proportion as is
appropriate to reflect not only the relative benefits received by
the Indemnifying Parties and the Indemnified Parties, but also to
reflect the relative fault of the Indemnifying and Indemnified
Parties in connection with the statements or omissions which
resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations;
provided, however, that, in any such case, no Selling Shareholder
shall be required to contribute any amount in excess of the
purchase price of all such Shares offered pursuant to such
registration statement, and no person guilty of a fraudulent
misrepresentation (as determined under Section 11(f) of the
Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
(b) The relative fault of such Indemnifying and
Indemnified Parties shall be determined by reference to, among
other things, whether any untrue or alleged untrue statement of a
material fact, or omission or alleged omission to state a
material fact, has been made by, or relates to information
supplied by, such Indemnifying Party or Indemnified Parties and
the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses,
claims, damages, liabilities and expenses referred to above shall
be deemed to include any reasonable legal or other fees or
expenses incurred by such party in connection with investigating
or defending such claim.
(c) Promptly after receipt by any party of notice of
the commencement of any action, suit or proceeding, the party
shall, if a claim for contribution in respect thereof is to be
made against another party, notify the contributing party of the
commencement thereof. The omission so to notify the contributing
party shall not relieve it from any liability which it may have
to any other party, except to the extent that the failure or
delay adversely affects the ability of the party to defend,
settle or satisfy the claim. In case any action, suit or
proceeding is brought against any party, and such party notifies
a contributing party of the commencement thereof, the
contributing party shall be entitled to participate therein with
the notifying party and any other contributing party similarly
notified.
10.3 Limitation of Market Activity. In connection
with any Demand Registration Statement or any Incidental
Registration Statement with respect to which the holders of
Rights Shares have registration rights under Article VIII or
Article IX (whether or not the holders of the Rights Shares have
exercised such rights), if so requested by the managing
underwriter, no holder of any Rights Shares shall offer or sell
any Shares (other than in a private transaction not involving a
sale in the public market or pursuant to Rule 144 under the
Securities Act) during the period when delivery of a prospectus
by an underwriter or dealer may be required with respect to the
offering pursuant to the Securities Act, and for a further period
of time (not to exceed 90 days) from the effective date of the
Incidental Registration Statement or Demand Registration
Statement as the managing underwriter for the offering may
specify in writing.
ARTICLE XI
PREEMPTION RIGHTS
11.1 Notice. At least 21 days prior to any proposed
Preemption Transaction, R&M shall give a Preemption Transaction
Notice to each registered holder of Rights.
11.2 Preemption Rights. (a) The registered holders
of Rights on the date that R&M gives a Preemption Transaction
Notice shall have the right, within 21 days after receipt of such
notice, to purchase for cash all (and not less than all) of the
Preferred Shares and/or Preferred Convertible Securities offered
pursuant to such Preemption Transaction upon substantially the
same terms and conditions provided for in the Preemption
Transaction.
(b) If there is more than one registered holder of
Rights on the date that R&M gives a Preemption Transaction
Notice, each such registered holder of Rights who desires to
purchase Preferred Shares and/or Preferred Convertible Securities
offered pursuant to such Preemption Transaction shall have a
right to purchase (unless all registered holders desiring to
purchase Preferred Shares and/or Preferred Convertible Securities
agree to a different allocation) a number of the Preferred Shares
and/or Preferred Convertible Securities offered determined by
multiplying the aggregate number of Preferred Shares and/or
Preferred Convertible Securities offered by a fraction, the
numerator of which is the number of Rights held by such
registered holder and the denominator of which is the number of
Rights held by all registered holders desiring to purchase
Preferred Shares and/or Preferred Convertible Securities.
(c) In the event any Preferred Shares or Preferred
Convertible Securities subject to a Preemption Transaction are to
be issued for consideration other than cash, the Board of
Directors of R&M shall, in the good faith exercise of their
business judgment expressed in a resolution adopted by the Board,
determine the fair market value per Preferred Share or Preferred
Convertible Security of the property to be received as
consideration. Such fair market value as so determined shall be
deemed to be the purchase price of such Preferred Shares and/or
Preferred Convertible Securities applicable with respect to the
exercise of the rights provided for in this Section 11.2.
(d) R&M must, within 180 days following the Preemption
Transaction Notice, conclude the Preemption Transaction described
in the Preemption Transaction Notice on the terms and conditions
described therein; provided, however, that the price at which the
Preemption Transaction is concluded may be less than the price
set forth in the Preemption Transaction Notice, but not less than
90% of such price. Any proposed Preemption Transaction on terms
and conditions different from those set forth in the preceding
sentence shall again be subject to the Preemption Rights in
accordance with Section 11.2(a).
ARTICLE XII
REPRESENTATIONS AND WARRANTIES
12.1 Representations and Warranties of R&M. R&M
hereby represents, warrants, and covenants to Eagle and the
holders of Rights or Rights Shares as of the date of this
Agreement as follows:
(a) Organization and Standing of R&M. R&M is a
corporation duly organized, validly existing and in good
standing under the laws of the State of Ohio and has full and
complete power and authority to own its properties and
assets, to carry on its business as the same is now being
conducted and to execute, deliver and perform this Agreement.
(b) Corporate Authority. The execution and delivery of
this Agreement and the performance by R&M of the transactions
contemplated hereby have been duly authorized by all
necessary corporate action on the part of R&M. This
Agreement is a legal, valid and binding obligation of R&M,
enforceable against R&M in accordance with its terms. Any
Shares issued to the registered holder of a Rights
Certificate upon due exercise of the Rights evidenced thereby
will be duly authorized, validly issued, fully-paid and non-
assessable and will be issued free of any liens or other
charges other than applicable stock transfer taxes.
(c) No Violation. Neither the execution and delivery
of this Agreement nor the consummation by R&M of the
transactions contemplated hereby (i) will violate any
provision of the Articles of Incorporation or Regulations of
R&M, (ii) will violate or be in conflict with any applicable
law or any judgment, decree, injunction or order of any court
or governmental agency or authority, or (iii) will violate or
conflict with or constitute a default (or an event which,
with notice or lapse of time or both, would constitute a
default) under or will result in the termination of,
accelerate the performance required by, or result in the
creation of any lien, security interest, charge or
encumbrance upon any of the assets or properties of R&M
under, the Articles of Incorporation or Regulations of R&M or
any contract, commitment, understanding, arrangement,
agreement or restriction of any kind or character to which
R&M is a party or by which R&M or any of its properties or
assets may be bound or affected.
(d) Capitalization. As of the date of this Agreement,
the authorized capital stock of R&M consists of 10,000,000
Shares, of which 5,120,471 Shares were issued and outstanding
as of June 30, 1994. As of the date of this Agreement there
are no outstanding options, warrants, convertible instruments
or other rights, agreements or commitments to acquire capital
shares of R&M granted or entered into by R&M other than
options or rights granted under Authorized Employee Plans and
this Agreement.
(e) Preemptive Rights. No shareholder or other person
has any preemptive rights, rights of first refusal or similar
rights to acquire additional capital shares of R&M, except as
provided for in this Agreement.
(f) Transfer Restrictions. To the best of R&M's
knowledge, there are no restrictions on transfer of R&M's
capital shares, other than those imposed by applicable state
and federal securities laws and by this Agreement.
(g) Consents. No authorization, consent, approval,
order of or filing with or notice to any third party or any
governmental agency, instrumentality or authority is
necessary for the execution and delivery of this Agreement by
R&M or the consummation by R&M of the transactions
contemplated hereby, except as otherwise provided herein.
(h) Authorized Employee Plans. Exhibit B is a true and
complete list of all Authorized Employee Plans and the
information set forth on Exhibit B with respect to each plan
is true and accurate as of June 30, 1994.
(i) Reserved Shares. R&M shall at all times reserve
and keep available solely for issuance, sale and delivery
upon the exercise of the Rights, a number of Shares equal to
the maximum number of full Shares issuable at any time upon
the exercise of the Rights. All Rights Shares shall, when
issued upon such exercise, (a) be duly and validly authorized
and issued, fully paid and nonassessable, and (b) be free
from all taxes, liens and charges with respect to the
issuance thereof other than any stock transfer taxes in
respect of any transfer occurring contemporaneously with such
issuance.
12.2 Representations and Warranties of Eagle. Eagle
represents and warrants to R&M as of the date of this Agreement
as follows:
(a) Organization and Standing of Eagle. Eagle is a
corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and has full
and complete power and authority to own its properties and
assets, to carry on its business as the same is now being
conducted and to execute, deliver and perform this Agreement.
(b) Corporate Authority. The execution and delivery of
this Agreement and the performance by Eagle of the
transactions contemplated hereby have been duly authorized by
all necessary corporate action on the part of Eagle. This
Agreement is the legal, valid and binding obligation of Eagle
enforceable against Eagle in accordance with its terms.
(c) No Violation. Neither the execution or delivery of
this Agreement nor the consummation by Eagle of the
transactions contemplated hereby (i) will violate any
provision of the certificate of incorporation or bylaws (or
other charter documents) of Eagle, (ii) will violate or be in
conflict with any applicable law or any judgment, decree,
injunction or order of any court or governmental agency or
authority, or (iii) will violate or conflict with or
constitute a default (or an event which, with notice or lapse
of time or both, would constitute a default) under or will
result in the termination of, accelerate the performance
required by, or result in the creation of any lien, security
interest, charge or encumbrance upon any of the assets or
properties of Eagle under, any term or provision of the
certificate of incorporation or bylaws (or other charter
documents) of Eagle or of any contract, commitment,
understanding, arrangement, agreement or restriction of any
kind or character to which Eagle is a party or by which Eagle
or any of its properties or assets may be bound or affected.
(d) Investment Representations. Eagle is an
"accredited investor" as defined in Rule 501 adopted under
the Securities Act. Eagle is acquiring the Rights for its
own account and not with a view to any distribution thereof.
Eagle acknowledges that the issuance of the Rights pursuant
to this Agreement has not been, and the issuance of any
Shares issued upon exercise of Rights will not be, except as
contemplated herein, registered under the Securities Act or
any applicable state securities laws, in reliance upon an
exemption from the registration requirements of the
Securities Act and such state laws, and neither the Rights
nor any Shares so issued may be resold or transferred unless
registered under the Securities Act and such state laws or
unless an applicable exemption from registration is available
(and the Rights Certificates and the certificates evidencing
any such Rights Shares will bear legends setting forth such
restrictions and the other restrictions imposed under this
Agreement). Eagle acknowledges receiving copies of R&M
Reports and that it has had the opportunity to ask questions
and receive answers concerning the terms and conditions of
this Agreement and the issuance of the Rights and to obtain
any additional information which R&M possesses or can acquire
without unreasonable effort or expense that is necessary to
verify the accuracy of any information provided by R&M to
Eagle.
ARTICLE XIII
MISCELLANEOUS
13.1 Amendment. No modification or amendment of any
provision of this Agreement shall be effective unless made in a
written instrument, duly executed by R&M and the holder or
holders of at least a majority of the outstanding Rights, if any;
provided, however, that no such amendment shall materially
adversely affect the rights hereunder of any holder of
outstanding Rights or Rights Shares without the approval of such
holder.
13.2 Further Assurances. Both parties shall execute
and deliver, or cause to be executed and delivered, all such
instruments, certificates, and documents, and shall take all such
other actions, as the other party to this Agreement may
reasonably request from time to time in order to effectuate the
purposes and intent of this Agreement.
13.3 Assignability. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their
respective successors and assigns. Notwithstanding the
foregoing, however, neither party may assign its rights under
this Agreement without the written consent of the other party
hereto.
13.4 Counterparts; Headings. This Agreement may be
executed simultaneously in one or more counterparts, each of
which shall be deemed an original, but all of which together
shall constitute one and the same agreement. The headings in
this Agreement are inserted for convenience of reference only and
shall not affect the meaning or interpretations of this
Agreement.
13.5 Entire Agreement. This Agreement and the
exhibits, other instruments, and documents referred to herein
contain the entire agreement between the parties with respect to
the transactions contemplated hereby, and supersede all
negotiations, representations, warranties, commitments, offers,
contracts, whether oral or written, prior to the date hereof.
13.6 Waiver. The failure of either party to insist in
any one or more instances upon performance of any provision of
this Agreement or to take advantage of any right hereunder shall
not be construed as a waiver of any such provision or the
relinquishment of any such right, and the same shall continue and
remain in full force and effect. No single or partial exercise
by a party of any right or remedy shall preclude other or further
exercise of any other right or remedy. Waiver by either party of
any breach of any provision of this Agreement shall not
constitute or be construed as a continuing waiver or as a waiver
of any other breach of any other provision of this Agreement.
13.7 Severability. In the event that any word,
phrase, clause, sentence, or other provision of this Agreement
shall violate any applicable law, such provision shall be invalid
to the extent of such violation without affecting the validity or
enforceability of any other provision of this Agreement.
13.8 Resolution of Disputes. (a) In the event a
dispute between R&M and Eagle arises under the terms of this
Agreement, either party may send to the other a letter of dispute
setting forth in particular the subject matter of the dispute
("Disputed Matter"). The parties shall meet at the offices of
R&M in Dayton, Ohio, or such other place as may be mutually
agreeable to them, not later than twenty days after the date of
the receipt of the letter of dispute for the purposes of
negotiating a settlement of the Disputed Matter.
(b) In the event that either party determines after
compliance with Section 13.8(a) that the Disputed Matter cannot
be resolved by the parties, the Disputed Matter shall be
submitted to binding arbitration before a panel of three
arbitrators in Cleveland, Ohio in accordance with the Commercial
Arbitration Rules of the American Arbitration Association;
provided, however, that (i) the parties may engage in prehearing
discovery to the full extent provided in the Federal Rules of
Civil Procedure, and (ii) evidentiary rules contained in the
Federal Rules of Civil Procedure shall govern the submission of
evidence at the arbitration hearings. Judgment upon the award by
the arbitrators may be entered in any court having jurisdiction
thereof. As part of such award the arbitrators may establish
their fee and expenses in connection therewith. The fees and
expenses of the arbitrators shall be apportioned between the
parties by the arbitrators in accordance with the findings and
results of the arbitration.
13.9 Notices. All notices, requests, demands and
other communications under this Agreement shall be in writing and
shall be deemed to have been duly given (i) on the date of
service if served personally on the party to whom notice is to be
given, (ii) on the day of transmission if sent via facsimile
transmission to the facsimile number given below, and telephonic
confirmation of receipt is obtained promptly after completion of
transmission, (iii) on the day after delivery to Federal Express
or similar overnight courier or the Express Mail service
maintained by the United States Postal Service, or (iv) on the
fifth day after mailing, if mailed to the party to whom notice is
to be given, by registered or certified mail, postage prepaid and
properly addressed, to the party as follows:
<PAGE>
If to R&M:
Robbins & Myers, Inc.
1400 Kettering Tower
Dayton, Ohio 45423
Telephone: 513/222-2610
FAX: 513/225-3314
Attention: Daniel W. Duval
President and Chief
Executive Officer
With a copy to:
Thompson, Hine and Flory
2000 Courthouse Plaza N.E.
Dayton, Ohio 45402-8801
Telephone: 513/443-6586
FAX: 513/443-6637
Attention: Joseph M. Rigot, Esq.
If to Eagle:
Eagle Industries, Inc.
Two North Riverside Plaza
Chicago, Illinois 60606
Telephone: 312/906-6880
FAX: 312/906-8402
Attention: William K. Hall
President and Chief
Executive Officer
With a copy to:
Eagle Industries, Inc.
Two North Riverside Plaza
Chicago, Illinois 60606
Telephone: 312/906-6860
FAX: 312/906-8402
Attention: Gus J. Athas, Esq.
Senior Vice President,
General Counsel and Secretary
and
Rosenberg & Liebentritt, P.C.
Suite 1600
Two North Riverside Plaza
Chicago, Illinois 60606
Telephone: 312/466-3456
FAX: 312/454-0335
Attention: Bruce C. Strohm, Esq. and
Jordan B. Allen, Esq.
If to a registered holder of Rights or Rights Shares
other than Eagle:
to the last address of such holder as shown on
R&M's transfer records
or to such other address as the person to whom notice is to be
given may have previously furnished to the other in writing in
the manner set forth above.
13.10 Cumulative Remedies. In addition to the other
remedies provided for in this Agreement, the parties will have
all rights and remedies granted under applicable law, including,
without limitation, the right to enforce the provisions of this
Agreement specifically and the right to recover damages in the
event of any breach of any provision of this Agreement.
13.11 Governing Law. This Agreement shall be construed
in accordance with, and the legal relations between the parties
shall be governed by, the laws of the State of Ohio as applicable
to agreements executed and fully performed in the State of Ohio.
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date first above written.
"R&M"
ROBBINS & MYERS, INC.
By /s/ Daniel W. Duval
----------------------
Daniel W. Duval
President and Chief
Executive Officer
"Eagle"
EAGLE INDUSTRIAL PRODUCTS
CORPORATION
By /s/ Gus J. Athas
----------------
Its Senior Vice-President
Exhibit 2.3
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES
LAW, AND MAY NOT BE SOLD OR TRANSFERRED UNLESS REGISTERED
UNDER THE ACT AND ALL APPLICABLE STATE SECURITIES LAWS OR
UNLESS AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS IS
AVAILABLE AT THE TIME OF TRANSFER OR IS OTHERWISE PERMITTED
BY SECTION 312 OF THE INDENTURE. TRANSFER OF THIS SECURITY
IS SUBJECT TO THE RESTRICTIONS SET FORTH IN SECTION 312 OF
THE INDENTURE DATED AS OF JUNE 30, 1994 BETWEEN ROBBINS &
MYERS, INC. AND PNC BANK, OHIO, NATIONAL ASSOCIATION, A COPY
OF WHICH WILL BE MAILED TO THE HOLDER OF THIS SECURITY
WITHIN FIVE DAYS AFTER A WRITTEN REQUEST THEREFOR IS
DELIVERED TO PNC BANK, OHIO, NATIONAL ASSOCIATION AT 201 E.
5TH STREET, CINCINNATI, OHIO 45201-1198.
ROBBINS & MYERS, INC.
SENIOR SUBORDINATED EXTENDIBLE RESET NOTE
Registered Number: R-1 Registered Dollars $50,000,000.00
Robbins & Myers, Inc., a Delaware corporation (herein
called the "Company," which term includes any successor
person under the Indenture hereinafter referred to), for
value received, hereby promises to pay to EAGLE SERVICE
CORPORATION OF DELAWARE, a Delaware corporation, or
registered assigns, the principal sum of FIFTY MILLION
DOLLARS on June 30, 1998, or, if Company exercises its
option to extend the maturity of all or a portion of this
Security for an additional three year period, on June 30,
2001, at the office or agency of the Company referred to
below, and to pay interest thereon on December 31, 1994 and
semi-annually thereafter on June 30 and December 31 in each
year, from June 30, 1994, or from the most recent Interest
Payment Date to which interest has been paid or duly
provided for, at the rate per annum set forth on the reverse
hereof, until the principal hereof is paid or duly provided
for, and (to the extent lawful) to pay on demand interest on
any overdue interest at the rate borne by the Securities
plus 2.0% from the date on which such overdue interest
becomes payable to the date payment of such interest has
been made or duly provided for.
The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided
in such Indenture, be paid to the person in whose name this
Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record
Date of such interest, which shall be the June 1 and
December 1 (whether or not a Business Day), as the case may
be, next preceding such Interest Payment Date. Interest
shall be computed on the basis of a 360-day year comprised
of twelve 30-day months. Any such interest not so
punctually paid or duly provided for on any Interest Payment
Date, and interest on such defaulted interest (to the extent
lawful) shall be paid at the rate to the Holder on such
Regular Record Date; and such defaulted interest and
interest on such defaulted interest (to the extent lawful)
may be paid to the person in whose name this Security (or
one or more Predecessor Securities) is registered at the
close of business on a Special Record Date for the payment
of such Defaulted Interest to be fixed by the Trustee,
notice whereof shall be given to Holders of Securities not
less than 10 days prior to such Special Record Date, or may
be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and upon
such notice as may be required by such exchange, all as more
fully provided in said Indenture.
Payment of the principal of (and premium, if any, on)
and interest on this Security will be made at the office or
agency of the Company maintained for that purpose in The
City of Cincinnati, or at such other office or agency of the
Company as may be maintained for such purpose, in such coin
or currency of the United States as at the time of payment
is legal tender for payment of public and private debts;
provided that payment of interest may be made at the option
of the Company (i) by check mailed to the address of the
person entitled thereto as such address shall appear on the
Security Register or (ii) by transfer to an account
maintained by the payee located in the United States.
Reference is hereby made to the further provisions of
this Security set forth on the reverse hereof, which further
provisions shall for all purposes have the same effect as if
set forth at this place.
Unless the certificate of authentication hereon has
been duly executed by the Trustee referred to on the reverse
hereof by manual signature, this Security shall not be
entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this
instrument to be duly executed under its corporate seal.
Dated: June 30, 1994 ROBBINS & MYERS, INC.
By /s/ Daniel W. Duval
-----------------------------
Daniel W. Duval
Attest: President and Chief Executive
Officer
/s/ Joseph M. Rigot
- --------------------------
Authorized Signature
FORM OF REVERSE OF SECURITY
This Security is one of a duly authorized issue of
securities of the Company designated as its Senior
Subordinated Extendible Reset Notes (herein called the
"Securities"), limited (except as otherwise provided in the
Indenture referred to below) in aggregate principal amount
to $50,000,000, which may be issued under an indenture
(herein called the "Indenture") dated as of June 30, 1994
between the Company and PNC Bank, Ohio, National
Association, as trustee (herein called the "Trustee," which
term includes any successor trustee under the Indenture), to
which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective
rights, limitations of rights, duties, obligations and
immunities thereunder of the Company, the Trustee and the
Holders of the Securities, and of the terms upon which the
Securities are, and are to be, authenticated and delivered.
The Company promises to pay interest on the principal
amount of this Security at an initial rate per annum of 5-
1/2%, until and through June 30, 1998. In the event the
Company exercises the Extension Option (as hereinafter
defined), then on each of June 30, 1998 and on June 30,
2000, the interest rate on this Security shall be reset at
the Reset Rate. Notwithstanding the foregoing, in no event
shall the interest rate on this Security shall be reset at a
rate below the initial interest rate. The "Reset Date"
shall be the Business Day next preceding the date which is
thirty-five days prior to June 30, 1998 or June 30, 2000, as
the case may be.
The Company will pay the principal amount of this
Security on the Maturity Date. The "Maturity Date" shall be
June 30, 1998 unless such date is extended by the Company,
at its option (the "Extension Option"), for an additional
three-year period ending on June 30, 2001, in which case the
"Maturity Date" shall be June 30, 2001. The Company may
elect to extend the maturity of all or a portion of the
Securities. If the Company elects to extend the maturity of
the Securities only in part, the aggregate principal amount
of such Securities the maturity of which is being extended
must at least equal $25,000,000. If the Company does not
elect to extend the maturity of the Securities to June 30,
2001, then upon any such prior maturity, the Securities not
so extended will become due and payable at 100% of principal
amount, together with accrued interest.
Notices of the Company's election to exercise the
Extension Option will be mailed at least 20 days but not
more than 30 days prior to June 30, 1998 to each holder of
Securities to be extended at his address as it appears on
the Security Register.
Promptly, but in any event by July 15, 2000, the
Company shall pay a commitment fee to each Holder of a
Security outstanding as of June 30, 2000, by mailing to such
Holder at his address as it appears on the Security
Register, a certified bank check payable to the order of
such Holder in an amount equal to 1% of the outstanding
unpaid principal amount of such Security as of June 30,
2000.
The indebtedness evidenced by the Securities is, to the
extent and in the manner provided in the Indenture,
subordinate and subject in right of payment to the prior
payment in full of all Senior Indebtedness as defined in the
Indenture, and this Security is issued subject to such
provisions. Each Holder of this Security, by accepting the
same, (a) agrees to and shall be bound by such provisions,
(b) authorizes and directs the Trustee on his behalf to take
such action as may be necessary or appropriate to effectuate
the subordination as provided in the Indenture and (c)
appoints the Trustee his attorney-in-fact for such purpose.
The Securities are subject to redemption upon not less
than 30 nor more than 60 days' notice, at any time, as a
whole or in part, at the election of the Company, in amounts
of $1,000 or integral multiples of $1,000 at a Redemption
Price equal to the percentage of the principal amount set
forth below if redeemed during the period set forth below:
Redemption
Period Price
Issue Date through
December 31, 1996 103.0%
January 1, 1997 through
December 31, 1997 101.5%
and thereafter at 100% of the principal amount, together in
the case of any such redemption with accrued interest, if
any, and any other fees owed with respect to such
Securities, if any, to the Redemption Date, all as provided
in the Indenture.
If less than all of the Securities are to be redeemed,
such portion of the Securities shall be redeemed in
compliance with the requirements of the principal securities
exchange, if any, on which the Securities are listed or, if
the Securities are not listed on a national securities
exchange, on a pro rata basis, by lot or by any other method
the Trustee shall deem fair and appropriate.
In the case of any redemption of Securities, interest
installments whose Stated Maturity is on or prior to the
Redemption Date will be payable to the Holders of such
Securities, or one or more Predecessor Securities, of record
at the close of business on the relevant Record Date
referred to on the face hereof. Securities (or portions
thereof) for whose redemption and payment provisions are
made in accordance with the Indenture shall cease to bear
interest from and after the Redemption Date.
In the event of redemption of this Security in part
only, a new Security or Securities for the unredeemed
portion hereof shall be issued in the name of the Holder
hereof upon the cancellation hereof.
Sections 1017, 1018 and 1019 of the Indenture provide
that upon the occurrence of a Change of Control and
following any Asset Sale or Net Worth Deficiency, as the
case may be, and subject to further limitations contained
therein, the Company shall make an offer to purchase certain
amounts of the Securities at a purchase price and in
accordance with the procedures set forth in the Indenture.
If an Event of Default shall occur and be continuing,
the principal of all the Securities may be declared due and
payable in the manner and with the effect provided in the
Indenture.
The Indenture contains provisions for defeasance at any
time of (a) the entire indebtedness of the Company on this
Security and (b) certain restrictive covenants and the
related Defaults and Events of Default, upon compliance by
the Company with certain conditions set forth therein, which
provisions apply to this Security.
The Indenture permits, with certain exceptions
(including certain amendments permitted without the consent
of any Holder) as therein provided, the amendment thereof
and the modification of the rights and obligations of the
Company and the rights of the Holders under the Indenture at
any time by the Company and the Trustee with the consent of
the Holders of a majority in aggregate principal amount of
the Securities at the time Outstanding. The Indenture also
contains provisions permitting the Holders of specified
percentages in aggregate principal amount of the Securities
at the time Outstanding, on behalf of the Holders of all the
Securities, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under
the Indenture and their consequences. Any such consent or
waiver by or on behalf of the Holder of this Security shall
be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange or
in lieu hereof whether or not notation of such consent or
waiver is made upon this Security.
No reference herein to the Indenture and no provision
of this Security or of the Indenture shall alter or impair
the obligation of the Company, which is absolute and
unconditional, to pay the principal of (and premium, if any,
on) and interest on this Security at the times, place, and
rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security
is registerable on the Security Register of the Company,
upon surrender of this Security for registration of transfer
at the office or agency of the Company maintained for such
purpose in The City of Cincinnati, duly endorsed by, or
accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly
executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new
Securities, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated
transferee or transferees.
The Securities are issuable only in registered form
without coupons in denominations of $1,000 and any integral
multiple thereof. As provided in the Indenture and subject
to certain limitations therein set forth, the Securities are
exchangeable for a like aggregate principal amount of
Securities of a different authorized denomination, as
requested by the Holder surrendering the same.
No service charge shall be made for any registration of
transfer or exchange of Securities, but the Company may
require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection therewith.
Prior to the time of due presentment of this Security
for registration of transfer, the Company, the Trustee and
any agent of the Company or the Trustee may treat the person
in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be
overdue, and neither the Company, the Trustee nor any agent
shall be affected by notice to the contrary.
A director, officer, employee or stockholder, as such,
of the Company or any other obligor on this Security shall
not have any liability for any obligations of the Company or
such obligor, as the case may be, under this Security or the
Indenture or for any claim based on, in respect of, or by
reason of such obligations or their creation. Each Holder
by accepting any of the Securities waives and releases all
such liability.
All terms used in this Security which are defined in
the Indenture shall have the meanings assigned to them in
the Indenture.
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the
Company pursuant to Section 1017, 1018 or 1019 of the
Indenture, check the appropriate box:
Section 1017 [ ]
Section 1018 [ ]
Section 1019 [ ]
If you wish to have a portion of this Security
purchased by the Company pursuant to Section 1017, 1018 or
1019 of the Indenture, state the amount:
$_________________
Date:_______________ Your
Signature:__________________________________
(Sign exactly as your
name appears on the
other side of this
Security)
Signature Guarantee:_________________________
Signature(s) must be guaranteed by a member
of or a participant in the Securities
Transfer Agents Medallion Program (STAMP),
the New York Stock Exchange Medallion
Signature Program (MSP) or the Stock Exchange
Medallion Program (SEMP) or a registered
depositary as defined in the Securities
Exchange Act of 1934, as amended, if the
Securities are to be issued other than to and
in the name of the registered owner.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
____________________________
| |
|____________________________|
_________________________________________________________________
________________
(Please print or typewrite name and address including zip code of
assignee)
_________________________________________________________________
_________________
the within Security and all rights thereunder, hereby irrevocably
constituting and appointing
__________________________________________________________
Attorney to transfer said Security on the books of the Company,
with full power of substitution in the premises.
Date:_______________ Your
Signature:________________________________
(Sign exactly as your
name appears on the other
side of this Security)
Signature
Guarantee:________________________________________
Signature(s) must be
guaranteed by a member of or
a participant in the
Securities Transfer Agents
Medallion Program (STAMP),
the New York Stock Exchange
Medallion Signature Program
(MSP) or the Stock Exchange
Medallion Program (SEMP) or a
registered depositary as
defined in the Securities
Exchange Act of 1934, as
amended, if the Securities
are to be issued other than
to and in the name of the
registered owner.
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the within-
mentioned Indenture.
PNC BANK, OHIO, NATIONAL
ASSOCIATION,
as Trustee
By
/s/ William H. Bresch
- ---------------------
Assistant Vice-President Authorized Officer
