<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 27, 1998
------------------
Chart Industries, Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
Delaware 1-11442 34-1712937
--------------- ------------ -------------------
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
</TABLE>
5885 Landerbrook Drive, Suite 150, Mayfield Heights, Ohio 44124
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
- --------------------------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
Registrant's telephone number, including area code: (440) 753-1490
-------------------------
<PAGE> 2
Item 2. Acquisition or Disposition of Assets.
------------------------------------
On March 27, 1998, Chart Industries, Inc. (the "Company")
acquired from IMI Marston Limited and IMI plc (collectively, "Marston")
substantially all of the assets (consisting primarily of real estate, plant and
equipment, certain intellectual property and contract rights, accounts
receivable, and inventory) (the "Assets") used in connection with Marston's
Industrial Heat Exchanger Business (the "Business"). The acquisition was
accomplished pursuant to an Agreement for the Sale and Purchase of The
Industrial Heat Exchanger Business dated March 5, 1998 among IMI Kynoch
Limited, IMI Marston Limited, IMI plc, Chart Marston Limited and Chart
Industries, Inc. (the "Agreement"). Chart Marston Limited is the Company's newly
formed U.K. subsidiary formed for the purpose of owning and operating the
Business utilizing the Assets.
The Business manufactures and distributes industrial heat
exchangers. The Business is headquartered and employs about 244 employees at
office and manufacturing locations in Wolverhampton, U.K. The products
manufactured by the Business are sold to customers primarily in the industrial
gas and hydrocarbon industries. The Business had 1997 sales of approximately
(pound) 18,104,000 (approximately US$ 29,875,000, assuming (pound) 1 equals
$1.65).
As consideration for this acquisition, the Company paid
Marston (pound) 21,000,000 in cash. The Agreement also provides that if the Net
Asset Value (as defined in the Agreement) reflected on the financial statements
of the Business as of the closing is more than (pound) 300,000 more than (pound)
2,867,000, the Company is obligated to pay the difference between such Net Asset
Value amount and (pound) 2,867,000 (along with interest thereon) to Marston. The
purchase price and other terms of the Agreement were determined through
arms-length negotiations. There are no material relationships between Marston
and the Company or any of their affiliates, directors or officers.
Payment of the purchase price was financed by the Company from
borrowings under its Credit Agreement, dated as of July 29, 1997, among the
Company, ALTEC International Limited Partnership, ALTEC, Inc., Chart Management
Company, Inc., Chart Industries Foreign Sales Corporation, Greenville Tube
Corporation and Process Systems International, Inc., Cryenco Sciences, Inc.
(added July 31, 1997), Cryenco, Inc. (added July 31, 1997), Chart International
Inc. (added March 5, 1998), National City Bank and NBD Bank as Banks (the
"Banks") and National City Bank, as agent for the Banks (the "Agent"), as
amended by the First Amendment to Credit Agreement, dated as of October 8, 1997
and the Second Amendment to Credit Agreement, dated as of March 5, 1998 (as so
amended, the "Credit Agreement"). The Company has pledged the shares of Chart
Marston Limited as security under the Credit Agreement.
The Company intends to utilize the Assets in order to operate
the Business substantially as operated prior to its acquisition by the Company.
2
<PAGE> 3
Item 7. Financial Statements, Pro Forma Financial Information and
---------------------------------------------------------
Exhibits.
--------
(a) FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED. Pursuant to
Item 7(a)(4) of Form 8-K, the Company will file the required financial
statements of the acquired business by amendment as soon as is practicable, but
not later than 60 days after the date on which this Current Report on Form 8-K
must be filed.
(b) PRO FORMA FINANCIAL INFORMATION. Pursuant to Item 7(a)(4)
of Form 8-K, the Company will file the required pro forma financial information
by amendment as soon as is practicable, but no later than 60 days after the date
on which this Current Report on Form 8-K must be filed.
(c) Exhibits.
--------
2.1 Agreement for the Sale and Purchase of The Industrial
Heat Exchanger Business dated March 5, 1998 among IMI
Kynoch Limited, IMI Marston Limited, IMI plc, Chart
Marston Limited and Chart Industries, Inc.
10.1 Second Amendment to Credit Agreement, dated as of
March 5, 1998, among the Chart Industries, Inc.,
ALTEC International Limited Partnership, ALTEC, Inc.,
Chart Management Company, Inc., Chart Industries
Foreign Sales Corporation, Greenville Tube
Corporation, Process Systems International, Inc.,
Cryenco Sciences, Inc., Cryenco, Inc., Chart
International Inc., National City Bank and NBD Bank
(the "Banks") and National City Bank as agent for the
Banks.
10.2 Permitted User Agreement, dated as of March 27, 1998,
between IMI Marston Limited and Chart Marston
Limited.
3
<PAGE> 4
SIGNATURE
---------
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
CHART INDUSTRIES, INC.
Date: April 13, 1998 By: /s/ Don A. Baines
--------------------------------
Don A. Baines
Chief Financial Officer and Treasurer
4
<PAGE> 5
EXHIBIT INDEX
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<TABLE>
<CAPTION>
Exhibit Description of Exhibit
------- ----------------------
<S> <C> <C>
2.1 Agreement for the Sale and Purchase of The
Industrial Heat Exchanger Business dated March
5, 1998 among IMI Kynoch Limited, IMI Marston
Limited, IMI plc, Chart Marston Limited and
Chart Industries, Inc.
10.1 Second Amendment to Credit Agreement, dated as
of March 5, 1998, among the Chart Industries,
Inc., ALTEC International Limited Partnership,
ALTEC, Inc., Chart Management Company, Inc.,
Chart Industries Foreign Sales Corporation,
Greenville Tube Corporation, Process Systems
International, Inc., Cryenco Sciences, Inc.,
Cryenco, Inc., Chart International Inc.,
National City Bank and NBD Bank (the "Banks")
and National City Bank as agent for the Banks.
10.2 Permitted User Agreement, dated as of March 27,
1998, between IMI Marston Limited and Chart
Marston Limited.
</TABLE>
E-1
<PAGE> 1
Exhibit 2.1
DATED 5th MARCH 1998
----------------------------------------------
IMI KYNOCH LIMITED (1)
- AND -
IMI MARSTON LIMITED (2)
- AND -
IMI PLC (3)
- AND -
CHART MARSTON LIMITED (4)
- AND -
CHART INDUSTRIES INC (5)
==================================================================
AGREEMENT
FOR THE SALE AND PURCHASE OF
THE INDUSTRIAL HEAT EXCHANGER BUSINESS
OF
IMI MARSTON LIMITED
==================================================================
DBR/44001-0425-0/SDG
PINSENT - CURTIS
3 Colmore Circus
Birmingham B4 6BH
Tel: 0121 200 1050
Fax: 0121 626 1040
1
<PAGE> 2
THIS AGREEMENT is made on 5th March 1998
BETWEEN:-
(1) IMI KYNOCH LIMITED (Registered in England No. 713735) whose
registered office is at Kynoch Works, PO Box 216, Birmingham B6 7BA,
United Kingdom (the "SELLER");
(2) IMI MARSTON LIMITED (Registered in England No. 155987) whose
registered office is at Wobaston Road, Fordhouses, Wolverhampton WV10
6QJ, United Kingdom ("MARSTON");
(3) IMI PLC (Registered in England No. 714275) whose registered office is
at Kynoch Works, PO Box 216, Birmingham B6 7BA, United Kingdom (the
"SELLER'S GUARANTOR");
(4) CHART MARSTON LIMITED (Registered in England No. 3497115) whose
registered office is at 55 Colmore Row, Birmingham B3 2AS (the
"BUYER"); and
(5) CHART INDUSTRIES INC a Delaware corporation whose principal office is
at 5885 Landerbrook Drive, Suite 150, Mayfield Heights, Ohio 44124,
United States of America (the "BUYER'S GUARANTOR")
WHEREAS:-
(A) Marston is a wholly-owned subsidiary of the Seller.
(B) By the Transfer Agreement Marston has agreed to sell the Business and
the Assets (other than the Freehold Property) to the Seller or as it
may direct.
(C) The Seller has agreed to sell the Business and the Assets to the
Buyer on the terms and subject to the conditions set out in this
Agreement.
IT IS AGREED as follows:-
1
<PAGE> 3
1 INTERPRETATION
1.1 In this Agreement, unless the context otherwise requires:-
"ACCOUNTS DATE" means 31 December 1997
"ACCOUNTS" means the unaudited management accounts
of the Business for the 12 month periods
ended on each of 31 December 1995, 1996
and 1997 and the profit and loss account
of the Business for the period of one
month to 31 January 1998 and the
unaudited balance sheet of the Business
as at 31 December 1997, each as annexed
to the Disclosure Letter
"ACT" means the Companies Act 1985
"ADVANCE PAYMENTS" means all amounts received by Marston
prior to the date of Completion in
relation to the Business in respect of
goods or services to be supplied by
Marston after Completion but excluding
such amounts which relate to the
Excluded Items or to rights of Marston
not taken over by the Buyer pursuant to
this Agreement
"AGENCY CONTRACTS" means those contracts listed in Part I
of Schedule 9 entered into prior to
Completion by Marston for the
appointment of third parties as the
agent of Marston in connection with the
Business
"ASSETS" means the property, undertaking,
rights and assets of the Business
agreed to be sold and purchased
under this Agreement details of
which are set out in Clause 2
"ASSOCIATED COMPANY" means, in relation to any company,
any subsidiary undertaking or parent
undertaking of that company or any
subsidiary undertaking of any such
parent undertaking
"ASSUMED LIABILITIES" means:-
(a) the Creditors;
(b) Marston's obligations under
the Contracts as provided
2
<PAGE> 4
in Clause 17;
(c) the Product Warranty
Commitments as provided in
Clause 18;
(d) Marston's obligations in
relation to performance bonds
and guarantees as provided in
Clause 20; and
(e) all other liabilities or
obligations of Marston
expressly assumed by the Buyer
under this Agreement
"BUSINESS" means the business of the Industrial
Heat Exchanger Group carried on by
Marston at Completion under the name
"IMI Marston"
"BUSINESS DAY" means a day (other than a Saturday) on
which clearing banks in the City of
London are open for the transaction of
normal sterling banking business
"BUSINESS INFORMATION" means all records, data, drawings,
plans, specifications, technical files
and reports owned by Marston relating to
and used solely or principally in
connection with the Business and all
commercial, financial, marketing or
technical information or trade secrets
owned by the Seller or Marston and used
exclusively in the Business each held in
any form or medium whatsoever other than
any records required by VATA to be
retained by Marston
"BUYER'S SOLICITORS" means Wragge & Co of 55 Colmore Row,
Birmingham B3 2AS
"CENTRAL SERVICES AGREEMENT" means an agreement in the agreed form to
be made between (1) the Buyer (2)
Marston and (3) the Buyer's Guarantor
and (4) the Seller's Guarantor relating
to the supply of certain utilities to
and services by the Buyer and/or Marston
to the Business, Marston's retained
businesses and all other businesses
located at the Site, whether or not
carried on by the Buyer or Marston
"COMPLETION" means completion of the sale and
purchase of the Business and
3
<PAGE> 5
Assets in accordance with this Agreement
"COMPLETION ACCOUNTS" means the balance sheet of the Business
as at Completion prepared in accordance
with Schedule 6
"CONFIDENTIAL INFORMATION" means such of the Business Information
which is secret or confidential,
commercial, financial, marketing or
technical information or trade secrets
"CONSIDERATION" means the amount referred to in Clause
4.1, as adjusted by the provisions of
Clause 7
"CONTRACTS" means the Agency Contracts, the Customer
Contracts, the Supplier Contracts, the
Finance Agreements, the IP Licence
Agreements and the Foreign Exchange
Contracts
"CREDITORS" means the amounts owed or accrued due to
any person by Marston in connection with
the Business at Completion to or in
respect of trade creditors (including to
any members of the Seller's Guarantor's
Group but, for the avoidance of doubt,
excluding notional debts of the Business
to the "corporate centre" of Marston)
arising through normal business
transactions, including the Advance
Payments
"CUSTOMER CONTRACTS" means those contracts listed in Part II
of Schedule 9 and all other contracts,
agreements, orders and binding
arrangements (whether written or oral)
entered into prior to Completion by
Marston for the supply or distribution
of goods and/or services by Marston in
connection with the Business and which
remain to be performed (in whole or in
part) by Marston at Completion:-
(a) the entering into of which
after the entering into of
this Agreement has been
approved by the Buyer; or
(b) entered into after the
entering into of this
Agreement but before
Completion in the ordinary
course of the Business and
under which the margin is
4
<PAGE> 6
not less than that usually
experienced in that type of
contract; or
(c) under which the price
(excluding VAT) of the
unperformed part of the
contract, agreement, order or
arrangement does not exceed
(pound)50,000
together with all offers made by Marston
prior to Completion to enter into such
contracts
"DEBTS"
means all amounts owing to Marston at
Completion in connection with the
Business by or in respect of trade
debtor accounts arising through normal
business transactions (whether or not
due and payable including, for the
avoidance of doubt, the benefit of
Prepayments and Deposits)
"DEPOSITS" means all amounts deposited with third
parties by Marston prior to Completion
(other than bank deposits) to secure the
performance of an obligation or
satisfaction of a condition by Marston
relating to the Business to the extent
such deposits remain outstanding as of
Completion
"DISCLOSURE LETTER" means the letter (together with all the
documents attached to it) in the agreed
form from the Seller to the Buyer
executed and delivered to the Buyer
immediately prior to the execution of
this Agreement
"EMPLOYEES" means those of the employees of Marston
employed in the Business at the date of
this Agreement whose names and other
details are set out in Schedule 1 who
continue to be so employed immediately
prior to Completion
"ENCUMBRANCE" means any encumbrance or security
interest of any kind whatsoever
including (without limitation) a
mortgage, charge, pledge, lien or
hypothecation"
"EXCLUDED CONTRACT" means the agreement between Marston and
Amoco Canada Petroleum Company Limited
(Amoco ref 76290C-16-002, Marston ref
DT617 and a supplemental letter dated
10 February 1998) relating to an
extended warranty, performance bond and
5
<PAGE> 7
outstanding payments and the related
performance bond dated 11 February 1998
"EXCLUDED DEBT" means the amounts owing to Marston at
Completion in connection with the
Business by or in respect of the
Excluded Contract as listed in Part IV
of Schedule 2
"EXCLUDED EMPLOYEE" means any employee of Marston or the
Seller who is not an Employee
"EXCLUDED ITEMS" means the assets and rights referred to
in Clause 3
"EXCLUDED LIABILITIES" means any liability to pay employer's
contributions for the period up to
Completion to the Pension Scheme and to
pay employees' contributions and
additional voluntary contributions
deducted from their pay in the period up
to Completion to the Pension Scheme and
all liabilities of Marston arising prior
to Completion other than the Assumed
Liabilities
"EXCLUDED TANGIBLE ASSETS" means the tangible assets listed in Part
II of Schedule 2
"FINANCE AGREEMENTS" means all those contracts listed in Part
III of Schedule 9 entered into by
Marston remaining to be performed in
whole or in part pursuant to which the
Leased Assets are being supplied to or
are held by Marston on hire purchase,
conditional purchase, hire, rental,
leasing, licence or other terms such
that title thereto has not at Completion
passed to Marston
"FOREIGN EXCHANGE CONTRACTS" means those contracts or commitments
listed in Part IV of Schedule 9 entered
into prior to Completion by Marston with
IMI Treasury for the sale or purchase of
foreign currency in connection with the
Contracts
"FREEHOLD PROPERTY" means the property details of which are
set out in Part I of Schedule 5
"GOODWILL" means the goodwill of Marston in
connection with the Business as at
Completion together with the exclusive
right (so far as the Seller and Marston
are able to grant the same) for the
Buyer to
6
<PAGE> 8
use the name "Industrial Heat Exchanger
Group" and the exclusive right to carry
on the Business in succession to Marston
"ICTA" means the Income and Corporation Taxes
Act 1988
"INDEPENDENT ACCOUNTANT" means a chartered accountant agreed upon
by the Seller and Buyer or, in the event
of their failure to agree within 20
Business Days of either party's notice
requiring the appointment of an
independent accountant, nominated (from
a group which excludes any person or
firm which has rendered services for the
Buyer's Guarantor or the Seller's
Guarantor or one or more of their
respective Associated Companies within
the period of two years prior to the
date of this Agreement) by the President
for the time being of the Institute of
Chartered Accountants in England and
Wales (or by such person as such
President may appoint for the purpose of
making such nomination), such chartered
accountant to act as an expert and not
as an arbitrator who shall have the
right to call for information from any
party hereto relevant to any decision he
may be required to make and to whom any
party hereto may make submissions in
connection therewith whose decision
(which shall be notified by means of a
written determination) shall (save in
the case of manifest error) be final and
binding on all parties hereto and whose
costs shall be borne by the Buyer and
the Seller in equal shares or in such
other manner as he shall consider
appropriate
"INDEPENDENT EXPERT" means an engineer agreed upon by the
Seller and Buyer or, in the event of
their failure within 20 Business Days of
either party's notice requiring the
appointment of an engineer, nominated by
the President of the Institution of
Mechanical Engineers (or by such person
as such President may appoint for the
purpose of making such nomination), such
engineer to act as an expert and not as
an arbitrator who shall have the right
to call for information from any party
hereto relevant to any decision he may
be required to make and to take legal
advice from a solicitor or barrister of
his choosing and to whom any party
hereto may make submissions in
connection therewith whose decision
7
<PAGE> 9
(which shall be notified by means of a
written determination) shall (save in
the case of manifest error) be final and
binding on all parties hereto and whose
costs shall be borne by the Buyer and
the Seller in equal shares or in such
other manner as he shall consider
appropriate
"INTELLECTUAL PROPERTY" means patents, registered and
unregistered trade marks and service
marks, registered designs, applications
for any of the foregoing and the right
to apply therefor in any part of the
world, any similar rights in any
country, trademarks and service marks,
mask works, copyrights, rights
in designs and inventions, discoveries,
trade secrets, processes, technology
know-how and other similar knowledge and
experience and the benefit of all design
and research and development work
"INTELLECTUAL PROPERTY RIGHTS" means the registered Intellectual
Property and applications therefor
specified in Part I of Schedule 4
together with the Intellectual Property
owned by Marston and used exclusively in
connection with the Business
"INTRA-GROUP BALANCES" means all sums owed by or to Marston to
or from any other members of the
Seller's Guarantor's Group at Completion
save for those in respect of trade
creditors arising through normal
business transactions
"IP ASSIGNMENTS" means assignments of the registered
Intellectual Property Rights in a form
agreed between the Buyer and the Seller
"IPI" means IMI Property Investments Limited
(Registered in England No 2395737)
"IP LICENCE AGREEMENTS" means the licences in respect of
Intellectual Property and information
technology listed in Part II of Schedule
4
"LEASES" means the two leases in the agreed form
between (1) IPI and (2) the Buyer for
the Buyer to occupy and use following
Completion the Leasehold Property
"LEASED ASSETS" means the plant and machinery listed in
Part III of Schedule 2 used by Marston
in the Business
8
<PAGE> 10
"LEASEHOLD PROPERTY" means the property to be the subject of
the Leases details of which are set out
in Part II of Schedule 5
"NET ASSET VALUE" means the value of the Tangible Assets,
Stock and Debts less the value of the
Creditors in each case as derived from
the Completion Accounts
"PENSION SCHEME" means the IMI Pension Fund details of
which are set out in Schedule 7
"PERMITTED USER AGREEMENT" means the licence in the agreed form in
respect of the Marston name
"PERMITS" means all licences, approvals, permits
and the like held by Marston exclusively
in connection with the Business and
which are capable of transfer to the
Buyer
"PREPAYMENTS" means all (if any) amounts paid prior to
Completion by or on behalf of Marston in
respect of the carrying on of the
Business to the extent that the same
were paid in respect of the supply to
Marston of goods or services after
Completion (but excluding amounts paid
in respect of Taxation assessed or
chargeable or otherwise relating to the
profits (actual or deemed) of Marston
and amounts paid in respect of, or in
connection with, insurance and any other
Excluded Item)
"PRODUCT LIABILITIES" means any liability resulting from
injury or death to any person, damage to
or destruction of property or otherwise
(including, for the avoidance of doubt,
consequential loss arising as a result
of any such liabilities) whether arising
before or after Completion by virtue of
any defect in products supplied or
services provided on or before the date
of Completion by Marston in relation to
the Business other than Product Warranty
Commitments
"PRODUCT WARRANTY COMMITMENTS" means the liabilities of Marston
(whether actual or contingent) under any
obligation contained in any contract
with customers to remedy defects in or
replace products supplied before
Completion by Marston in relation to the
Business
9
<PAGE> 11
"PROVISIONAL CASH CONSIDERATION" means the sum of (pound)21,000,000
(twenty-one million pounds)
"REGULATIONS" means the Transfer of Undertakings
(Protection of Employment) Regulations
1981
"RESTRICTED BUSINESS" means the manufacture, marketing and/or
sale of the following:-
(a) heat exchangers, assemblies
and cold boxes for all land
based and offshore cryogenic,
processing and industrial
applications, including, but
not limited to, those for
atmospheric gas plants,
hydrocarbon and natural gas
processing and treatment
plants, LNG liquefaction and
air portable oxygen and
nitrogen generator systems;
(b) heat exchangers and assembly
packages for transport
applications, including, but
not limited to, those for
railway locomotive cooling
systems and "on rail"
processing and treatment
plants;
(c) heat exchangers for fuel
cells, process intensification
applications and
refrigeration, including, but
not limited to, gas clean-up,
gas reformers and
recouperators for static and
mobile power systems and
service vehicles;
(d) heat exchangers for combined
heat and mass transfer
applications, including, but
not limited to, overflow
packing elements and
dephlegmator/reflux units; and
(e) structured packing elements
for use in mass transfer
columns and heat exchange
columns
10
<PAGE> 12
"RESTRICTED PERSON" means the Seller's Guarantor and any
other member of the Seller's Guarantor's
Group from time to time
"RTPA" means the Restrictive Trade Practices
Acts 1976 and 1977
"SELLER'S GUARANTOR'S GROUP" means the Seller's Guarantor and its
Associated Companies
"SELLER'S SOLICITORS" means Pinsent Curtis of 3 Colmore
Circus, Birmingham B4 6BH
"SITE" means the Wobaston Road, Wolverhampton
site, details of which are set out in
Part III of Schedule 5
"STOCK" means all stocks of consumables, stock
in trade, raw materials, work in
progress, partly finished and finished
goods and processed materials, wherever
located, held by or on behalf of Marston
in connection with the Business at
Completion
"SUPPLIER CONTRACTS" means those contracts listed in Part V
of Schedule 9 and all other contracts,
agreements, binding arrangements and
outstanding orders (whether written or
oral) entered into prior to Completion
by Marston with suppliers for the supply
to Marston of goods or services (other
than in respect of insurance)
exclusively in connection with the
Business which at Completion remain to
be performed in whole or in part:-
(a) the entering into of which
after the entering into of
this Agreement but before
Completion has been approved
by the Buyer; or
(b) under which the price
(excluding VAT) of the
unperformed part of the
contract, agreement, order or
arrangement does not exceed
(pound)100,000
"TANGIBLE ASSETS" means the plant and machinery listed in
Part I of Schedule 2 together with the
loose plant, machinery, tools,
furniture, fittings, moulds, dies and
other like articles owned by Marston,
and used exclusively or principally in
the Business except for
11
<PAGE> 13
the Excluded Tangible Assets and all
those assets required to be used by
Marston in performing its obligations
under the Central Services Agreement
"TAXATION" includes (without limitation):-
(a) advance corporation tax,
capital gains tax, corporation
tax, customs and excise
duties, income tax (including
PAYE), inheritance tax,
insurance premium tax,
national insurance
contributions, rates and
community charge, stamp duty,
stamp duty reserve tax and
VAT;
(b) all former and foreign taxes;
(c) all other levies, imposts,
duties, charges or
withholdings in the nature of
taxes imposed by any Taxation
Authority; and
(d) all interest, penalties, fines
and other charges relating to
any of the above or to a
failure to make any return or
supply any information in
connection with any of the
above
"TAXATION AUTHORITY" means the Inland Revenue, H.M. Customs &
Excise, the Department of Social
Security and any other body having
functions in relation to Taxation
"TENANCIES" has the meaning ascribed to it in Part
IV of Schedule 5
"TRANSFER AGREEMENT" means an agreement dated 4 March 1998
between (1) Marston and (2) the Seller
by which Marston agreed to sell the
Business and Assets (other than the
Freehold Property) to the Seller or as
it may direct, a copy of which is
annexed to the Disclosure Letter
"VAT" means value added tax
"VATA" means the Value Added Tax Act 1994
12
<PAGE> 14
"WARRANTIES" means the warranties contained in
Schedule 3 and references to a
"WARRANTY" shall be construed
accordingly
1.2 In this Agreement, unless the context otherwise requires, a reference
to:-
1.2.1 a Clause or Schedule is a reference to a clause of or
schedule to this Agreement;
1.2.2 a document "IN THE AGREED FORM" is a reference to a document
in the form approved, and for the purposes of identification
only signed, by or on behalf of the Buyer and the Seller;
1.2.3 a statutory provision includes a reference to that provision
as modified, replaced, amended and/or re-enacted from time
to time (whether before or after the date of this Agreement)
and any prior or subsequent subordinate legislation made
under it except to the extent that any such modification,
replacement, amendment or re-enactment would increase or
extend the liability of the Buyer, Seller or Marston under
this Agreement;
1.2.4 "COSTS" includes a reference to costs, charges and expenses
of every description;
1.2.5 a "PERSON" includes a reference to an individual,
partnership, unincorporated association or body corporate
wherever incorporated or situate and includes a reference to
that person's legal representatives and successors;
1.2.6 a "SUBSIDIARY", "HOLDING COMPANY" and "BODY CORPORATE" has
the respective meaning set out in section 736 and 740 of the
Act;
1.2.7 a "COMPANY" has the meaning set out in section 735 of the
Act;
1.2.8 a "SUBSIDIARY UNDERTAKING" or a "PARENT UNDERTAKING" has the
meaning set out in
13
<PAGE> 15
sections 258 and 259 of the Act; and
1.2.9 a "GROUP UNDERTAKING" has the meaning set out in section 259
of the Act.
1.3 The Schedules form part of this Agreement and shall be interpreted or
construed as though they were set out in this Agreement.
1.4 The headings to the Clauses, Schedules and paragraphs of the Schedules
are for convenience only and shall not affect the interpretation of
this Agreement.
1.5 General words introduced by the word "OTHER" are not to be given a
restrictive meaning because they are preceded by words indicating a
particular class of acts, matters or things and are not to be given a
restrictive meaning because they are followed by particular examples
intended to be embraced by the general words.
1.6 Any statement which refers to the knowledge or knowledge and belief of
the Seller or so far as the Seller is aware or any similar expression
shall be deemed to refer to the knowledge only of J O'Shea and P A
Boulton (a director and the secretary) but to include an additional
statement that it has been made after (in the case of paragraph 1.6.1)
due and careful, and (in the case of paragraphs 1.6.2 to 1.6.9)
reasonable enquiries of:-
1.6.1 in relation to all of the Warranties, B Watton (director of
Marston and general manager of the Business) and T J Davies
(finance director and company secretary of Marston);
1.6.2 in relation to all of the Warranties, K J Blount, G P
Causier, P A Morgan, N P Omerod, M T Symonds and T Wood,
being the immediate subordinates of B Watton;
1.6.3 in relation to all Warranties contained in paragraph 16 of
Schedule 3 (Pensions), Mrs J R Pickett, IMI Group pensions
manager;
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1.6.4 in relation to all Warranties contained in paragraph 18 of
Schedule 3 (Property), L Frith, managing director of IPI;
1.6.5 in relation to all Warranties contained in paragraph 6 of
Schedule 3 (Intellectual Property), C Sykes, manager of the
Patents and Licensing Department at the Seller's Guarantor;
1.6.6 in relation to all Warranties contained in paragraph 19 of
Schedule 3 (Environmental), M White, IMI Group environmental
adviser;
1.6.7 in relation to all Warranties contained in paragraph 15 of
Schedule 3 (Employees), J S Kaye, administrative services
manager at Marston;
1.6.8 in relation to all Warranties contained in paragraph 7 of
Schedule 3 (Insurance), P Bissell, corporate risk and
insurance manager; and
1.6.9 in relation to all Warranties contained in paragraph 17 of
Schedule 3 (Taxation), A Duquenoy, IMI Group taxation
manager.
2 SALE OF THE BUSINESS AND THE ASSETS
-----------------------------------
2.1 The Seller agrees to sell with full title guarantee and the Buyer
agrees to buy, with effect from Completion, the Business as a going
concern and the Assets comprising:-
2.1.1 the Freehold Property;
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2.1.2 the Tangible Assets;
2.1.3 the Goodwill;
2.1.4 the Intellectual Property Rights (save that in relation to
rights in designs and inventions, discoveries, trade
secrets, processes, technology and other knowledge and
experience and the benefit of design and research
development work comprised in the Intellectual Property
Rights, the Seller agrees to sell only such right, title and
interest as it and Marston may have and its full title
guarantee shall not apply thereto);
2.1.5 the Business Information;
2.1.6 the Stock;
2.1.7 the benefit (subject to the burden) of the Contracts;
2.1.8 the Debts;
2.1.9 the Permits; and
2.1.10 all other assets owned by Marston and used exclusively in
the Business, save for the Excluded Items.
2.2 The Freehold Property is sold on the terms set out in Schedule 5 and
the Seller and the Buyer agree to and shall comply with the provisions
of Schedule 5 relating to the Freehold Property and the Leasehold
Property.
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<PAGE> 18
3 EXCLUDED ITEMS
--------------
There are excluded from the sale and transfer under this Agreement the
following:-
3.1 all cash in hand and at bank;
3.2 the Excluded Tangible Assets;
3.3 the Excluded Contract;
3.4 the Excluded Debt;
3.5 all shares held by Marston;
3.6 the statutory books of Marston;
3.7 the benefit of any repayments of Taxation made by any Taxation
Authority to Marston or the Seller;
3.8 the benefit of any insurance policies held by any member of the
Seller's Guarantors Group;
3.9 save as provided in Clause 13 (Names) and in the Permitted User
Agreement, the right to use the IMI or Marston names, logos or marks;
and
3.10 without prejudice to the generality of the foregoing all other
property, assets and rights of Marston which are not exclusively used
in connection with the Business and which are not expressly
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<PAGE> 19
transferred to the Buyer pursuant to the terms of this Agreement.
4 CONSIDERATION
-------------
4.1 Subject to the provisions of Clause 7 and Schedule 6 (Completion
Accounts), the consideration for the purchase of the Business and the
Assets is the Provisional Cash Consideration together with the
agreement of the Buyer in Clause 16.2 to discharge the Assumed
Liabilities, apportioned between the Assets as follows:-
4.1.1 the Freehold Property (pound)3,000,000
4.1.2 the Tangible Assets (pound)2,500,000
4.1.3 the patents and applications
therefor forming part of the
Intellectual Property Rights (pound)1,000,000
4.1.4 the know-how forming part of the
Intellectual Property Rights (pound)4,000,000
4.1.5 the balance of the Intellectual
Property Rights and the Business
Information (pound)1
4.1.6 the Stock
the sum
ascertained from
the Completion
Accounts
4.1.7 the Debts
the sum
ascertained from
the Completion
Accounts
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<PAGE> 20
4.1.8 the Goodwill the balance of
the Consideration
plus the amount
of the Assumed
Liabilities
ascertained from
the Completion
Accounts
4.1.9 the Contracts
the agreement by
the Buyer to
assume
liabilities
thereunder to the
extent provided
in this Agreement
4.1.10 the Permits
the agreement by
the Buyer to
assume the terms
of the Permits to
the extent
provided in this
Agreement
4.2 The Provisional Cash Consideration is payable by the Buyer at
Completion.
4.3 If a party fails to pay any sum due and payable by it under this
Agreement on the due date of payment in accordance with the terms of
this Agreement, the party shall pay interest on the sum from the due
date until the date upon which the obligation of the party to pay the
sum is discharged at the rate of two per cent. per annum above the
base lending rate of Barclays Bank PLC from time to time in force
(whether before or after judgment).
4.4 If after the date of this Agreement the Buyer transfers all or part of
the Intellectual Property Rights for an amount in excess of the
consideration apportioned to the Intellectual Property Rights under
Clauses 4.1.3, 4.1.4 and 4.1.5 the Buyer covenants to pay to the
Seller an amount equal to any additional Taxation liability arising to
the Seller or Marston as a result of the Inland Revenue challenging
the amount of the consideration apportioned under Clause 4.1.3 to the
Intellectual Property Rights together with all costs, expenses,
penalties and interest reasonably incurred by the Seller or Marston in
connection with such challenge or such additional Taxation liability.
4.5 If any party to this Agreement or any Associated Company of such party
to this Agreement obtains a corporation tax deduction or any other
saving or credit against taxation as a result of any liability or
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<PAGE> 21
matter giving rise to a claim under the indemnities contained in this
Agreement, the amount payable under the indemnity concerned shall be
reduced by an amount equal to the tax which is saved as a result of
the deduction, saving or credit.
4.6 If any party to this Agreement or any Associated Company of such party
suffers any charge to Taxation in respect of any sum payable under any
of the indemnities contained in this Agreement (after taking account
of any reduction made in accordance with Clause 4.5) the amount so
payable shall be grossed up by such amount as will ensure that after
deduction of the Taxation so chargeable there shall remain a sum equal
to the amount that would otherwise have been payable under such
indemnity.
4.7 The parties agree that no election will be made under section 531(3)
ICTA in relation to the transfer of know-how pursuant to this
Agreement.
5 PRIOR TO COMPLETION
-------------------
5.1 From the date of this Agreement until Completion neither the Seller
nor Marston shall take any action with the intention of causing the
Business to be conducted otherwise than in the ordinary and usual
course.
5.2 From the date of this Agreement until Completion:-
5.2.1 each of the Seller and Marston shall use their respective
reasonable endeavours in the ordinary course of the Business
and in consultation with the Buyer to preserve intact the
business organisation and the relationships with persons
having business dealing with Marston in relation to the
Business; and
5.2.2 upon the Buyer giving to Marston reasonable prior notice the
Seller and Marston shall give to the Buyer and its
representatives reasonable access to the Assets and Business
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<PAGE> 22
Information during the normal operating hours of the Business and
shall allow the Buyer to consult with relevant and suitable employees
of the Business in relation thereto (save that in the case of any
lender or similar person and its representatives, this access shall be
limited to access to the Site solely for the purposes of assessing the
value of the Assets for security purposes) provided that at all times
the Seller or Marston shall be entitled to appoint a person to be
present at such consultations or when such access is given and the
Buyer and its representatives shall comply with all regulations and
reasonable restrictions of Marston or the Seller governing such
access, including as to confidentiality and prior notification of the
identity of the individuals requested to have access.
5.3 Solely for the purposes of permitting the Buyer to mitigate any loss
to it (and not for the purposes of rescinding or terminating this
Agreement) the Seller shall as soon as reasonably practicable notify
the Buyer if it becomes aware both of any event or circumstance which
renders any Warranty inaccurate in any material extent and that such
event or circumstance has resulted in that Warranty becoming
inaccurate in any material respect.
5.4 In the event that prior to Completion the Tangible Assets, the
Freehold Property or the Stock shall sustain significant loss or
damage by reason of fire, flood, wind or other natural calamity
(regardless of whether or not such loss is insured):-
5.4.1 the Seller shall as soon as reasonably practicable notify
the Buyer of the damage and provide its reasonable estimate
of the cost of repair of the damage together with any
estimates provided by contractors or other third parties or
reports of any loss adjuster relating in each case to the
damage and its repair and the date of Completion shall be
postponed until the date 5 Business Days after receipt by
the Buyer of such estimate;
5.4.2 if the cost of repair set out in the estimate provided
pursuant to Clause 5.4.1 exceeds (pound)4,200,000 the Buyer
shall be entitled to terminate this Agreement by notice in
writing to the Seller on or before the day to which
Completion is postponed pursuant to Clause 5.4.1.
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<PAGE> 23
5.5 For the purposes of Clause 5.4 "loss or damage" shall only include
such physical damage or loss to the Tangible Assets, the Freehold
Property or the Stock as is caused by fire, flood, wind or other
natural calamity and shall not include loss of profits or turnover,
unliquidated damages or other losses arising from any interruption of
the Business or otherwise caused by such damage or loss.
5.6 If the Buyer terminates this Agreement pursuant to Clause 5.4.2 the
rights and obligations of the parties to this Agreement shall cease
immediately on termination except that:-
5.6.1 each party's rights in respect of breaches by any other
party of its obligations under this Agreement prior to
termination shall continue in full force and effect; and
5.6.2 the provisions of Clause 25 (Announcements) shall remain in
full force and effect.
5.7 On the date of this Agreement the Buyer shall deliver to the Seller:-
5.7.1 an opinion in the agreed form from Calfee, Halter & Griswold
LLP relating to the entering into and performance by the
Buyer's Guarantor of this Agreement and the documents to be
entered into by it at Completion;
5.7.2 a copy, certified as true by the secretary or a director of
the Buyer or the Buyer's Guarantor (as appropriate), of
excerpts from the minutes of meetings of the board of
directors of each of the Buyer and the Buyer's Guarantor, as
signed by the secretary or a director of each respective
meeting, resolving that each of the Buyer and the Buyer's
Guarantor (as appropriate) should enter into this Agreement
and each document to be entered into by each of them on the
date hereof or at Completion, and authorising execution of
this Agreement and each such document by each person signing
on behalf of the Buyer or the Buyer's Guarantor.
5.8 On the date of this Agreement the Seller shall deliver to
the Buyer a copy, certified as true by the secretary or a
director of the Seller, Marston or the Seller's Guarantor
(as appropriate), of the minutes
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<PAGE> 24
of meetings of the board of directors (or a committee thereof) of each
of the Seller, Marston and the Seller's Guarantor, as signed by the
chairman of each respective meeting, resolving that each of the
Seller, Marston and the Seller's Guarantor should enter into this
Agreement and each document to be entered into by each of them on the
date hereof or Completion, and authorising execution of this Agreement
and each such document by each person signing on behalf of the Seller,
Marston or the Seller's Guarantor.
6 COMPLETION
6.1 Completion shall take place at the offices of the Seller's Solicitors
on 27 March 1998.
6.2 At Completion the Seller shall deliver to the Buyer (in the case of
the assets referred to in Clauses 6.2.1 and 6.2.2, at the Freehold
Property):-
6.2.1 possession of those Assets which are transferable by
delivery;
6.2.2 the Leased Assets;
6.2.3 the Permitted User Agreement, duly executed by Marston;
6.2.4 the Leases duly executed by IPI;
6.2.5 the Central Services Agreement, duly executed by Marston and
the Seller's Guarantor;
6.2.6 the Transfer (as defined in Part IV of Schedule 5), duly
executed by IPI, the Seller and Marston;
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<PAGE> 25
6.2.7 the deed of indemnity in relation to the Pension Scheme in
the agreed form, duly executed by the Seller, Marston and
the Seller's Guarantor;
6.2.8 the VAT invoice referred to in Clause 21.2; and
6.2.9 the IP Assignments, duly executed by Marston (provided that,
in the event that the Buyer and the Seller are unable to
agree the form of the IP Assignments prior to Completion,
Completion shall not be delayed and assignments shall be
delivered following Completion pursuant to Clause 28.1.).
6.3 At Completion the Buyer shall pay the Provisional Cash Consideration
by telegraphic transfer to the client account of the Seller's
Solicitors (Account name: Pinsent Curtis Client Account; Sort Code:
60-02-35; Account Number 10396225; Bank Address: National Westminster
Bank Plc, PO Box 87, Colmore Centre, 103 Colmore Row, Birmingham B3
3NS) , who are irrevocably authorised by the Seller to accept the
same, and whose receipt shall be an absolute discharge to the Buyer of
its obligation to pay the Provisional Cash Consideration.
6.4 At Completion the Buyer shall deliver to the Seller:-
6.4.1 a counterpart of the Permitted User Agreement, duly executed
by the Buyer;
6.4.2 counterparts of the Leases, duly executed by the Buyer;
6.4.3 a counterpart of the Central Services Agreement, duly
executed by the Buyer and the Buyer's Guarantor;
6.4.4 a counterpart of the Transfer, duly executed by the Buyer;
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<PAGE> 26
6.4.5 a counterpart of the deed of indemnity referred to in Clause
6.2.7 duly executed by the Buyer and the Buyer's Guarantor;
and
6.4.6 counterparts of the IP Assignments, duly executed by the
Buyer (provided that, in the event that the Buyer and the
Seller are unable to agree the form of the IP Assignments
prior to Completion, Completion shall not be delayed and
assignments shall be delivered following Completion pursuant
to Clause 28.1.)
7 COMPLETION ACCOUNTS
7.1 Schedule 6 shall have effect for the preparation of the Completion
Accounts and the ascertainment of the Net Asset Value.
7.2 If the Net Asset Value exceeds (pound)2,867,000 by more than
(pound)300,000 the Consideration for the sale under this Agreement
shall be increased by an amount equal to the excess of the Net Asset
Value over (pound)2,867,000 and the Buyer shall pay to the Seller such
amount within 10 Business Days of agreement or determination of the
Net Asset Value together with interest on such amount from (and
including) the date of Completion until (but excluding) the date of
payment at the rate of two per cent. per annum above the base lending
rate of Barclays Bank PLC from time to time in force.
7.3 If the Net Asset Value falls short of (pound)2,867,000 by more than
(pound)300,000 the Consideration for the sale under this Agreement
shall be reduced by an amount equal to the shortfall of the Net Asset
Value below (pound)2,867,000 and the Seller shall repay to the Buyer
such amount within 10 Business Days of agreement or determination of
the Net Asset Value together with interest on such amount from (and
including) the date of Completion until (but excluding) the date of
payment at the rate of two per cent. per annum above the base lending
rate of Barclays Bank PLC from time to time in force.
7.4 Any amount payable by the Buyer pursuant to Clause 7.2 shall be paid
by telegraphic transfer to the client account of the Seller's
Solicitors, who are irrevocably authorised to accept the same, and
whose
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<PAGE> 27
receipt shall be an absolute discharge to the Buyer of its obligation
to pay the sum payable under Clause 7.2
7.5 Any amount payable by the Seller pursuant to Clause 7.3 shall be paid
by telegraphic transfer to such bank account of the Buyer as is
notified to the Seller by the Buyer on or prior to the due date for
payment under Clause 7.3
7.6 All amounts payable under this Agreement shall be paid in full without
deduction, set-off or counterclaim.
8 WARRANTIES
8.1 The Seller warrants to the Buyer as at the date of this Agreement in
the terms set out in Schedule 3.
8.2 The Warranties are subject only to:-
8.2.1 any matter which is fairly disclosed in the Disclosure
Letter;
8.2.2 any matter or thing done or omitted to be done prior to
Completion at the written request, or with the written
approval of the Buyer; and
8.2.3 the provisions of Clause 9 (Limitation on Warranties).
8.3 The Seller acknowledges that the Buyer is entering into this Agreement
in reliance upon the Warranties but the Seller makes no representation
and gives no warranty or undertaking to the Buyer save only as and to
the extent expressly set out in this Agreement.
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<PAGE> 28
8.4 Each of the Warranties shall be interpreted as a separate and
independent warranty so that the Buyer shall have a separate claim and
right of action in respect of every breach of each Warranty.
8.5 Any amount paid by the Seller to the Buyer as damages for breach of
the Warranties or any other term of this Agreement shall be treated as
a reduction or refund of the consideration paid or payable under this
Agreement.
8.6 Except as provided in Clause 5.2.2, the Buyer shall have no right to
rescind or terminate this Agreement either before or after Completion
by reason of a breach of any of the Warranties or otherwise.
8.7 None of the Warranties (other than those contained in paragraph 19 of
Schedule 3) shall be deemed to constitute, directly or indirectly, a
warranty as to or in respect of any matters relating to the
Environment or as to compliance or otherwise with any law, regulation,
rule, treaty or convention relating to the pollution, contamination or
protection of human health or the Environment, or the creation,
storage, handling and disposal of industrial waste and/or hazardous
substances or any other matters relating to the Environment, and the
Buyer acknowledges and agrees that the Seller makes no warranty in
relation to matters relating to the Environment or such compliance or
otherwise or as to any other matters relating to the Environment (save
as expressly provided in paragraph 19 of Schedule 3). For the purposes
of this Clause "Environment" shall have the meaning given in Schedule
8.
9 LIMITATION ON WARRANTIES
9.1 For the purposes of this Clause 9, "Claim" means any claim (whether in
contract, tort or otherwise) made by the Buyer for breach of any of
the Warranties.
9.2 The Seller's liability under the Warranties shall be limited as
follows:-
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<PAGE> 29
9.2.1 the Seller shall have no liability in respect of, and there
shall be disregarded for all purposes (including, but
without limitation, Clause 9.2.2), any individual Claim
unless that individual Claim exceeds (pound)5,000;
9.2.2 no Claim shall be made by the Buyer until the aggregate
liability for all Claims by the Buyer (including all
previous Claims whether or not satisfied and including
costs) shall exceed (pound)300,000 in which case the whole
amount shall be capable of being claimed and not simply the
excess;
9.2.3 the Seller's maximum aggregate liability in respect of all
Claims (including interest and costs) is limited to
(pound)15,750,000; and
9.2.4 no Claim shall be made unless the Claim has been notified in
writing (giving such details as are reasonably available to
the Buyer of the specific matter in respect of which such
Claim is made including the nature of the breach and the
amount claimed) to the Seller before the third anniversary
of Completion.
9.3 Any Claim which has been made against the Seller (and which has not
been previously satisfied, settled or withdrawn) shall be deemed to
have been withdrawn and shall become fully barred and unenforceable on
the expiry of the period of six months commencing on the expiry of the
period in which notification of that Claim may be given in accordance
with Clause 9.2.4, unless legal proceedings in respect of the Claim
shall have been properly issued and validly served on the Seller.
9.4 The Seller shall have no liability in respect of any Claim:-
9.4.1 to the extent that it arises or is increased as a result of
the passing of any legislation (or making of any subordinate
legislation) after Completion with retrospective effect;
9.4.2 to the extent that it relates to any loss for which the
Buyer is indemnified by insurance or provision of applicable
law;
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9.4.3 to the extent that the matter giving rise to the Claim was
allowed, provided for or reserved in the Completion
Accounts.
9.5 The Buyer warrants to the Seller that at the date of this Agreement it
knows of no fact or circumstance which would give rise to a Claim.
9.6 The Seller's liability for any Claim shall be subject to the following
limitations and procedures:
9.6.1 The Claim shall not include any amount with respect to which
Buyer has been or will be reimbursed by Buyer's insurance or
by another source by reason of the provisions of applicable
law.
9.6.2 The amount of the Claim shall be adjusted by any tax savings
actually achieved by the Buyer in respect of the Claim and
any tax cost actually incurred by the Buyer in respect of
the Claim or payment of the Claim by Seller, the intention
of the parties in this Clause 9.6.2 being to place the Buyer
in the same economic condition that it would have been had
the Claim not occurred.
9.6.3 The Buyer shall and shall procure that each group
undertaking of the Buyer shall take all reasonable steps to
avoid and/or mitigate the Seller's liability under the
Warranties.
9.6.4 In the event Buyer is notified by a third party that it
intends to make a claim against Buyer which may give rise to
a Claim, Buyer shall follow the procedures described in
Clause 9.10 with respect to such third party claim.
9.6.5 In the event that, subsequent to the date on which Seller
has made payment to Buyer in satisfaction of a Claim, Buyer
is reimbursed by a third party for part or all of its loss
set forth in such Claim or obtains a tax relief or repayment
related thereto, Buyer shall
29
<PAGE> 31
refund to Seller the amount of such reimbursement, relief or
repayment (up to the amount of Seller's payment); provided,
however, that Buyer shall have no obligation to seek
reimbursement from a third party (other than making
appropriate claims against Buyer's insurer and other than
using Buyer's best endeavours to claim available tax reliefs
or repayments) for Buyer's losses which give rise to a
Claim.
9.6.6 If the Buyer or any group undertaking of the Buyer is
entitled or may be entitled to recover from a third party
any sum which is referable to a matter giving rise to a
Claim the Buyer shall as soon as reasonably practicable
notify the Seller and provide such information as the Seller
may reasonably require relating to such right of recovery.
9.6.7 To the extent Seller offers reasonable evidence that a
matter which gave rise to a Claim which has been paid by
Seller to Buyer may also form the basis for a claim for
reimbursement of all or part of Buyer's loss by a third
party, Buyer will, at Seller's request, assign Buyer's
rights to such third party claim to Seller and cooperate in
any reasonable manner, at Seller's cost, in Seller's efforts
to seek recovery from such third party.
9.7 The Buyer shall not be entitled to recover damages from the Seller
more than once in respect of any individual item or loss or damage
suffered by the Buyer;
9.8 No liability will arise for breach of any of the Warranties if and to
the extent that:-
9.8.1 such breach is attributable to any voluntary act or omission
(other than in the ordinary course of conducting the
Business) of the Buyer or persons deriving title from the
Buyer after Completion; or
9.8.2 such breach arises from an act or omission of the Seller
occurring prior to Completion at the request of the Buyer.
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9.9 If the Buyer or any group undertaking of the Buyer becomes aware of
any matter which it realises or should have realised is likely to give
rise to a Claim or upon any Claim being made the following provisions
shall apply:-
9.9.1 the Buyer shall as soon as reasonably practicable give
written notice specifying in reasonable detail the event,
matter or default which is likely to give rise or gives rise
to the Claim and the amount of such Claim to the Seller of
the matter and shall consult with the Seller with respect to
the matter;
9.9.2 the Buyer shall provide, and shall procure that each group
undertaking of the Buyer will provide, to the Seller and the
Seller's professional advisers full access to premises,
personnel and to all relevant assets, documents, records and
information within the power, possession or control of the
Buyer or any group undertaking of the Buyer for the purpose
of investigating the matter;
9.9.3 the Buyer shall and shall procure that each group
undertaking of the Buyer shall use its reasonable efforts to
preserve all relevant assets, documents, records and
information within the power, possession or control of the
Buyer or any group undertaking of the Buyer which are or are
likely to be relevant in connection with any matter which is
likely to give rise to a Claim for so long as an actual or
prospective Claim or such matter remains outstanding;
9.9.4 the Seller shall at its reasonable cost be entitled to
copies of any of the documents or records, and to photograph
any premises or assets, referred to in paragraph 9.9.2;
9.9.5 the Buyer shall not make and shall procure that no group
undertaking of the Buyer shall make any admission of
liability in respect of or compromise or settle the matter
without the prior written consent of the Seller such consent
not to be unreasonably withheld or delayed.
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9.10 In the event that any party (the "Indemnified Party") seeks
indemnification hereunder from another party (the "Indemnifying
Party") or otherwise seeks damages from another party for breach of
any of the Warranties and the Indemnified Party's claim arises out of
a claim or allegation by any third party (the "Third Party Claim"),
the following procedures shall govern the conduct of the Third Party
Claim.
9.10.1 The Indemnified Party shall give written notice to the
Indemnifying Party as soon as practicable following its
receipt of notice of the Third Party Claim; provided that
any delay in giving such notice shall not relieve the
Indemnifying Party of liability hereunder unless it suffered
actual prejudice as a result of such delay.
9.10.2 In the case of any Third Party Claim the whole or part of
which is covered by insurance of the Seller's Guarantor's
Group, Seller or its insurers shall control the defence of
such Third Party Claim.
9.10.3 Subject to Clause 9.10.2, in the case of any Third Party
Claim made by a material supplier or customer of Buyer and
with respect to which Buyer intends to seek indemnification
hereunder, Buyer shall control the defence of such Third
Party Claim. No settlement of such Third Party Claim shall
be entered into by Buyer without Seller's prior written
consent, which consent shall not be unreasonably withheld or
delayed;
9.10.4 In the case of all Third Party Claims (other than those
described in 9.10.2 and 9.10.3 above), the Indemnifying
Party shall be entitled to control the defence and
settlement of such claims if, upon its receipt of the notice
described in Clause 9.10.1 above, it acknowledges in writing
that any loss suffered or to be suffered by the Indemnified
Party by reason of such Third Party Claim, is fully
indemnifiable hereunder. If the Indemnifying Party fails to
submit such written acknowledgement within 30 days after
receipt of the notice described in Clause 9.10.1, the
Indemnified Party shall control the defence of the Third
Party Claim but shall not settle such Third Party Claim
without the prior written consent of the Indemnifying Party,
such consent not to be unreasonably withheld or delayed.
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9.10.5 The party which is not in control of the defence of any
Third Party Claim shall be entitled to participate in, at
its own cost, but not to control, the defence of the Third
Party Claim and the parties hereto shall cooperate with each
other in such defence
10 RISK AND TITLE
--------------
Risk in and title to the Assets shall pass to the Buyer on Completion.
11 POSITION AFTER COMPLETION
-------------------------
11.1 Subject to the provisions of this Agreement, from Completion the Buyer
shall carry on the Business and be entitled to all profits earned and
all income and other sums receivable and bear all losses and shall pay
all outgoings and be responsible for all liabilities incurred in
carrying on of the Business. Subject to the provisions of this
Agreement, the Buyer shall indemnify Marston and keep Marston
indemnified against all liabilities arising out of or in connection
with the Business following Completion.
11.2 Each party shall forthwith pass to the other any payment, notice,
correspondence, information or enquiry in relation to the Business or
the Assets which it receives after Completion and which properly
belongs to the other.
11.3 To the extent required by the Seller or Marston or any Associated
Company of Marston for preparing or auditing their respective
statutory accounts or tax returns, or responding to any request or
enquiry of a taxation authority or in connection with any civil,
criminal, arbitration or other proceedings actual or threatened or for
the purpose of dealing with claims by Employees or former employees of
the Business or to fulfil any legal obligation or to carry on its
remaining businesses, the Buyer shall make available any books and
records which are delivered to the Buyer under the terms of this
Agreement for inspection by representatives of Marston or any member
of the Seller's Guarantor's Group during normal business hours on
reasonable advance notice being given for a period of up to seven
years from Completion (or, in the case of books and records relating
to personnel, health and safety matters, 20
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years from Completion) and during such period and at such times and on
such notice, Marston shall make available any books and records not
delivered to the Buyer which contain information in existence at
Completion relating to the Business which may be required for the
purpose of the Business or for any tax or other return in connection
therewith for inspection by representatives of the Buyer. The party
receiving or inspecting any information pursuant to this Clause 11.3
and each group undertaking of such party shall not use (save for the
purposes intended by this Clause 11.3) or disclose such information
and shall take reasonable steps to prevent the use or disclosure of
such information) and in both cases the party inspecting documents (at
such party's reasonable cost) shall be entitled to take copies of such
documents.
11.4 The Buyer may at any time offer to return to the Seller any such books
and records delivered to it under this Agreement and referred to in
Clause 11.3 at no cost to the Seller. If and to the extent that the
Buyer makes any such offer it shall be released from all continuing
obligations and liability under Clause 11.3.
11.5 Without prejudice to Clause 11.3, the Buyer (or any group undertaking
of the Buyer) shall provide (or shall procure the provision of) to
Marston or any member of the Seller's Guarantor's Group and their
professional advisers and its insurers and their advisers reasonable
access to premises, personnel and to all relevant assets, documents,
records and information (howsoever held) within the power, possession
or control of the Buyer or any group undertaking of the Buyer for the
purpose of investigating all matters relating to the Product
Liabilities and/or enabling Marston or any member of the Seller's
Guarantor's Group to take such action as it deems appropriate and
shall use reasonable endeavours to procure that all group undertakings
of the Buyer shall retain and preserve all relevant assets, documents,
records and information within the power, possession or control of any
group undertaking of the Buyer of, or relating to, the Business which
are relevant in connection with any Product Liability and Marston or
any member of the Seller's Guarantor's Group shall at the Seller's
reasonable cost be entitled to copies of any of the documents or
records and to photograph any premises or assets.
12 PROTECTION OF GOODWILL
----------------------
12.1 The Seller's Guarantor undertakes to the Buyer that without the
written consent of the Buyer:-
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12.1.1 for a period of three years from Completion it will not and
will procure that no Restricted Person will in any capacity
whatsoever directly or indirectly carry on any Restricted
Business;
12.1.2 for a period of three years from Completion it will not and
will procure that no Restricted Person will (except by
general advertising otherwise than by way of notice
exhibited at the Site) directly canvass, solicit or
endeavour to entice away any Employee who is an employee of
the Buyer at the time of any such approach or contact and
who is engaged in a managerial, technical or sales capacity;
and
12.1.3 for a period of three years from Completion it will not and
will procure that no Restricted Person will at any time for
the purpose of any Restricted Business, canvass, solicit, or
endeavour to entice away as a customer of the Buyer any
person who during the period of 12 months prior to the date
of Completion has been a customer of Marston in connection
with the Business.
12.2 Nothing in Clause 12.1 shall preclude any Restricted Person from
acquiring any firm, partnership or business, or any shares of a
company or group of companies which is or is about to be engaged in
any activity restricted under Clause 12.1.1 ("the Acquired Business")
or from carrying on or permitting the carrying on of the Acquired
Business
PROVIDED THAT:
12.2.1 the turnover of the Acquired Business derived from such
restricted activities during its last completed financial
year prior to its acquisition by the Restricted Person does
not represent more than 10 per cent of the total turnover of
the Acquired Business during such financial year; and
12.2.2 the acquisition of such part of the Acquired Business which
is engaged or is about to be engaged in such restricted
activities is not the principal motive for the acquisition
of the Acquired Business.
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12.3 Nothing in Clause 12.1 shall prevent any Restricted Person from owning
not more than three per cent of any class of the issued share capital
of a company which is dealt in on a recognised investment exchange (as
defined in the Financial Services Act 1986).
12.4 The Seller's Guarantor has taken independent legal advice and
acknowledges that it considers the undertakings contained in Clause
12.1 reasonable for the proper protection of the Business and further
acknowledges that damages would not be an adequate remedy for breach
of such undertakings.
12.5 Each of the undertakings contained in Clause 12.1 is separate and
severable and shall be construed on that basis. In the event that any
such undertaking is found to be void but would be valid if some part
of it were deleted or if the period or extent of it were reduced such
undertaking shall apply with such modification as may be necessary to
make it valid and effective.
13 NAMES
-----
13.1 The Buyer shall (and shall procure that any group undertaking of the
Buyer shall), save as specifically provided in Clause 13.2, within the
period of 60 days following Completion for all items cease to use the
IMI name, mark or logo and in particular (but without limitation)
shall remove the same from its products, premises, vehicles, brochures
and stationery of all sorts and undertakes both for itself and on
behalf of any of its group undertakings not at any time after
Completion to represent or hold itself out as being connected or as
having any association (save for any actual on-going trading
relationships) with the Seller's Guarantor's Group (including using
any name, mark or logo likely to be confused with the IMI name, mark
or logo except during the period of 60 days referred to above) and
that between the date of Completion and the expiry of the said period
of 60 days the Buyer (or any relevant group undertaking of the Buyer)
shall apply stickers to all its outgoing stationery, brochures, goods
and packaging bearing the IMI name, mark or logo indicating that the
Buyer (or the relevant group undertaking of the Buyer) is not part of
the Seller's Guarantor's Group.
13.2 In the event that the Buyer has not obtained any quality stamp
required by the American Society of
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Mechanical Engineers to be stamped on the range of products
manufactured by the Business at the date of Completion by the expiry
of the period of 60 days referred to in Clause 13.1 then Marston will
at the Buyer's cost provide reasonable assistance to the Buyer to help
it obtain such quality stamps and notwithstanding anything to the
contrary in Clause 13.1 until the earlier of the date 6 months from
Completion and the date upon which the Buyer has obtained such quality
stamp, the Buyer shall be entitled to use in relation to the Business
the relevant quality stamp held by Marston at Completion bearing the
IMI name, mark or logo.
13.3 The Buyer undertakes to indemnify and hold harmless the Seller (for
itself and as agent and trustee for the benefit of each other member
of the Seller's Guarantor's Group) from and against all losses,
damages, costs, actions, proceedings, claims, demands and expenses
arising from the use after Completion of any such names, logos or
marks as are referred to in Clauses 13.1 and 13.2 and that neither the
Buyer nor any of its group undertakings will commit or do any act or
thing (other than enforcing its rights under this Agreement) or pursue
any course of conduct which might reasonably be expected to bring the
Seller's Guarantor or any other member of the Seller's Guarantor's
Group into disrepute to a material degree.
13.4 The Buyer agrees for a period of 18 months after Completion to procure
for the Seller's Guarantor copies of any stationery used by the Buyer
(or any of its group undertakings) promptly upon request by the
Seller's Guarantor and during normal business hours to co-operate with
the reasonable requests of the Seller's Guarantor necessary for the
purposes of verifying that the undertakings of the Buyer set out in
this Clause 13 have been complied with.
13.5 Nothing in this Clause 13 or any other provisions of this Agreement
shall in any way prohibit or restrict the Seller's Guarantor or any
member of the Seller's Guarantor's Group from using the names, logos
or marks IMI or Marston or any colourable imitation of them in any
manner or combination it sees fit save that with effect from
Completion neither the Seller's Guarantor nor any member of the
Seller's Guarantor's Group shall represent or hold itself out as being
connected or as having any association (save for any actual on-going
trading relationships) with the Business, the Buyer or any group
undertaking of the Buyer. Neither the Seller's Guarantor nor any of
its group undertakings will commit or do any act or thing (other than
enforcing its rights under this Agreement) or procure any course of
conduct which might reasonably be expected to bring the Buyer's
Guarantor or any of its Associated Companies into disrepute to a
material degree.
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14 EMPLOYEE
--------
14.1 The Seller and the Buyer acknowledge that the Regulations apply and
accordingly the employment of all Employees and any collective
agreement relating thereto shall be transferred from Marston to the
Buyer with effect from Completion subject to the right of any of the
Employees to object to their transfer pursuant to Regulation 5(4A) of
the Regulations.
14.2 Marston shall be responsible for all emoluments and outgoings in
respect of the Employees (including without limitation all wages,
holiday pay, bonuses, commission, PAYE, national insurance
contributions, pensions contributions and otherwise) up to Completion
save that the Buyer shall be responsible for payment to Employees of a
bonus in accordance with the rules of the IMI Employee Profit Sharing
Scheme at the rate of 2.0 pence in the (pound)1 of Qualifying
Remuneration (as defined in the rules of the scheme) in respect of the
period from 1 January 1997 to Completion. Payment of the bonus will be
made on the first payroll date of the Business following Completion.
The amount of the bonus shall for the purposes of this Agreement be
treated as an Assumed Liability.
14.3 The Buyer shall be responsible for all emoluments and outgoings in
respect of the Employees (including without limitation all wages,
holiday pay, bonuses, commission, PAYE, national insurance
contributions, pensions contributions and otherwise) from Completion
and shall indemnify and hold harmless Marston against all liabilities,
claims, demands and expenses (including legal expenses on an indemnity
basis) in respect of the same.
14.4 The Buyer will assume the outstanding obligations of Marston in
respect of the accrued holiday entitlements of the Employees at
Completion.
14.5 Marston shall indemnify and hold harmless the Buyer from and against
all losses, costs, claims, demands, actions, fines, penalties,
liabilities and expenses (including legal expenses on an indemnity
basis) in connection with or as a result of any claim or demand by any
Employee in respect of redundancy, unfair dismissal or any other claim
whatsoever within the jurisdiction of an industrial tribunal, wrongful
dismissal, breach of contract, any other claim whatsoever arising at
common law,
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<PAGE> 40
sex, race or disability discrimination, equal pay, any claim in tort
or otherwise (in all cases whether arising under British or European
law) arising directly or indirectly from any act, fault or omission of
the Seller in respect of any Employee prior to Completion;
14.6 Marston shall indemnify and hold harmless the Buyer from and against
all losses, costs, claims, demands, actions, fines, penalties,
liabilities and expenses (including legal expenses on an indemnity
basis) in connection with or as a result of any claim or demand by any
Excluded Employee arising out of the employment of any Excluded
Employee;
14.7 The Buyer shall indemnify and hold harmless Marston from and against
all losses, costs, claims, demands, actions, fines, penalties, awards,
liabilities and expenses (including legal expenses on an indemnity
basis) in connection with or as a result of any claim or demand by any
Employee in respect of redundancy, unfair dismissal or any other claim
whatsoever within the jurisdiction of an industrial tribunal, wrongful
dismissal, breach of contract, any other claim whatsoever arising at
common law, sex, race or disability discrimination, equal pay, any
claim in tort or otherwise (in all cases whether arising under British
or European law) arising directly or indirectly from any act, fault or
omission of the Buyer in respect of any Employee whether arising
before on or at any time after Completion.
14.8 The Buyer shall indemnify and hold harmless Marston and the Seller
from and against all losses, costs, claims, demands, actions, fines,
penalties, awards, liabilities and expenses (including legal expenses
on an indemnity basis) in connection with or as a result of any claim
(including any entitlement of an Employee under or consequent on such
claim) by any trade union or staff association or other appropriate
representative (within the meaning of Regulation 10 of the
Regulations) arising from or connected with any information given by
the Buyer to the Seller (including, without limitation, any measures
the Buyer intends to implement in connection with the Employees after
Completion) to enable the Seller to comply with its obligations to
such trade union, staff association or other appropriate
representative under Regulation 10 of the Regulations and whether or
not any such claim arises or has its origin before or after
Completion;
14.9 The Buyer warrants to Marston that it has furnished to Marston any
information concerning any measures (within the meaning of Regulation
10 of the Regulations) that the Buyer intends to take in relation to
any Employee and shall indemnify and hold harmless Marston against any
breach of this obligation (including against any legal expenses on an
indemnity basis).
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14.10 Without prejudice to Clause 14.7 the Buyer shall indemnify and hold
harmless Marston from and against all losses, costs, claims, demands,
actions, fines, penalties, awards, liabilities and expenses (including
legal expenses on an indemnity basis) in connection with or as a
result of any claim by any Employee that the identity of the Buyer is
to that Employee's detriment or that the terms and conditions to be
provided by the Buyer are to that Employee's detriment provided that
such claim arises after Completion.
15 PENSION ARRANGEMENTS
--------------------
In relation to pension arrangements the provisions of Schedule 7
(Pension Provisions) apply.
16 LIABILITIES
-----------
16.1 Marston hereby undertakes to the Buyer to pay discharge and satisfy
when the same fall due to be paid, satisfied or discharged the
Excluded Liabilities and to indemnify and keep indemnified the Buyer
from and against such liabilities.
16.2 The Buyer hereby undertakes to Marston to pay, discharge and satisfy
when the same fall due to be paid, satisfied or discharged the Assumed
Liabilities and to indemnify and keep indemnified Marston from and
against such liabilities. Where after Completion a Creditor is not
discharged by the Buyer in accordance with its terms and the person to
whom the Creditor is payable is a supplier to Marston in respect of
its continuing businesses Marston may on the expiry of seven days'
written notice to the Buyer of its intention to do so discharge the
Creditor and the Buyer will on demand reimburse Marston in respect of
such payment.
17 CONTRACTS AND PERMITS
---------------------
17.1 Save as provided in Clause 18 in relation to Product Warranty
Commitments, the Buyer shall take over
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from Marston the benefit and burden of the Contracts and Permits with
effect from Completion and the Buyer shall adopt, perform and
discharge all obligations arising under the Contracts and the Permits
and the Buyer shall be entitled to all payments made in connection
with the Contracts after Completion. The Buyer shall indemnify Marston
against all actions, proceedings, costs, damages, claims and demands
under or in relation to the Contracts and the Permits arising out of
or in respect of this Agreement or the transfer of the Business and
Assets pursuant to this Agreement or any act, omission or default
under any of the Contracts or the Permits following Completion.
17.2 Insofar as any of the Contracts or the Permits cannot be transferred
to the Buyer except by an assignment made with the consent of another
party or by a novation agreement and such consent or novation has not
been received prior to Completion, this Agreement shall not constitute
an assignment or an attempted assignment of the Contract or the Permit
and until such Contract or Permit shall be assigned or novated Marston
shall hold the same in trust for the Buyer absolutely and the Buyer
shall, as Marston's sub-contractor, perform all the obligations of
Marston thereunder and the Buyer shall be entitled to all payments
made in connection with those obligations.
17.3 Marston and the Buyer will each use their respective reasonable
endeavours to obtain all consents and approvals needed for such
assignment or novation of each of the Contracts.
17.4 Marston and the Buyer will each use their respective reasonable
endeavours to obtain all consents and approvals needed for the
assignment or transfer of the Permits.
17.5 Subject to the provisions of Clause 18.7, Marston shall perform and
discharge all obligations arising under the Excluded Contract and the
Seller shall be entitled to all payments made in connection with the
Excluded Contract after Completion.
18 PRODUCT WARRANTY COMMITMENTS
----------------------------
18.1 The Buyer undertakes to Marston and the Seller:-
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18.1.1 with effect from Completion to discharge all claims made
under the Product Warranty Commitments and to take such
actions as it reasonably deems appropriate including,
without limitation, settling, compromising, defending,
remedying, disputing, resisting or mitigating such claims;
and
18.1.2 that in dealing with claims under the Product Warranty
Commitments it will deal in good faith having regard to the
Seller's obligations under Clause 18.3 and shall not
intentionally or gratuitously act in any manner which is
likely to increase the Seller's liabilities under Clause
18.3.
18.2 The Buyer shall, for a period of three years from the date of
Completion, at the end of every quarter (commencing at the end of the
quarter commencing at the end of the month in which Completion
occurred) provide to the Seller a list of all claims under the Product
Warranty Commitments which have arisen in the preceding quarter and
such list shall contain full details of the nature of the claim, the
claimant and a statement of the costs (including reasonable expenses
and legal costs) incurred by the Buyer solely in discharging Marston's
liability in respect of each claim under a Product Warranty
Commitment.
18.3 The Seller shall, subject to Clause 18.4, within 30 days of receiving
the list referred to in Clause 18.2 and a request for payment,
reimburse to the Buyer:-
18.3.1 the cost of meeting claims under the Product Warranty
Commitments arising prior to Completion; and
18.3.2 one-half of the amount by which the cost of meeting claims
under Product Warranty Commitments arising in the period of
12 months commencing on the date of Completion (or if longer
the warranty period specified in the relevant Customer
Contract at the date of Completion), excluding all claims
where such cost is (pound)5,000 or less, exceeds
(pound)50,000.
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18.4 If the Seller does not agree with the cost of meeting any or all of
the claims under Product Warranty Commitments specified in Clause 18.3
then it shall give written notice to the Buyer that a dispute exists,
providing details of the dispute and if the Seller and the Buyer have
not resolved the dispute within 10 Business Days of the date of the
Buyer's receipt of such notice the dispute shall be referred to the
Independent Expert. In the event of such dispute referral, the agreed
or determined cost of meeting claims under the Product Warranty
Commitments shall be paid by the Seller to the Buyer within 20
Business Days of such agreement or determination.
18.5 All amounts set out in this Clause are stated exclusive of any VAT
chargeable thereon.
18.6 For the purposes of this Clause 18 a claim under a Product Warranty
Commitment shall be deemed to arise when it is first notified to
either Marston or the Buyer.
18.7 In the event that Marston shall have any liability under the Excluded
Contract to replace any product (or any part of any product) or supply
any additional products or services then the Buyer hereby undertakes
that the Buyer will supply such replacement product or part or
additional product or service to Marston to enable it to fulfil such
obligations under the Excluded Contract and in addition will provide
Marston with all reasonable expertise and labour required by Marston
in meeting such liability and in return Marston shall pay to the Buyer
an amount equal to its reasonable cost in supply of such product (or
part or service), together with an amount per day equal to the daily
salary of each of the Buyer's employees reasonably required to meet
the Buyer's obligations hereunder (all sums payable being paid within
ten Business Days after delivery by the Buyer to Marston of an invoice
in respect thereof, such invoices to be prepared by the Buyer in
respect of products (or parts or services) supplied during each period
of three months commencing with the three month period which commences
on the day following Completion) and for the avoidance of doubt the
provisions of Clauses 18.1 to 18.6 shall not apply to any liability
under the Excluded Contract.
18.8 If Marston does not agree with the amount of any invoice raised by the
Buyer in accordance with Clause 18.7 then it shall give written notice
to the Buyer that a dispute exists, providing details of the dispute
and if Marston and the Buyer have not resolved the dispute within ten
Business Days of the date of the Buyer's receipt of such notice the
dispute shall be referred to the Independent Expert. In the event of
such dispute referral, the agreed or determined cost shall be paid by
Marston to the Buyer
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within 20 Business Days of such agreement or determination.
19 CONFIDENTIALITY AND NON-SOLICITATION
------------------------------------
19.1 Following Completion the Buyer will keep confidential and not make use
of any confidential information of Marston not forming part of the
Business Information which is in the possession of the Buyer or the
Employees at Completion or comes into their possession as a result of
their occupation of the Freehold Property or the Leasehold Property
after Completion, including, without limitation, financial and
accounting information and procedures, customer information,
manufacturing procedures, techniques and knowhow and details of
product development, in each case of a confidential nature.
19.2 Following Completion, Marston and the Seller will keep confidential
and not make use of any confidential information of the Buyer (not
being Confidential Information) which is in the possession of Marston
or the Seller or the Excluded Employees at Completion or comes into
their possession after Completion as a result of the Buyer's
occupation of the Freehold Property or the Leasehold Property after
Completion, including, without limitation, financial and accounting
information and procedures, customer information, manufacturing
procedures, techniques and know-how and details of product
development, in each case of a confidential nature.
19.3 Save as provided in Clause 11.3, the Buyer's Guarantor will not and
will procure that no Restricted Person will at any time after
Completion make use of any Confidential Information.
19.4 Clauses 19.1, 19.2 and 19.3 do not apply to:-
19.4.1 disclosure of confidential information to the extent
required by any stock exchange, the Panel on Takeovers and
Mergers or by law or by a court of competent jurisdiction;
or
19.4.2 confidential information which comes into the public domain
otherwise than by a breach
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by the party required to keep it confidential.
19.5 The Buyer undertakes to Marston that without the written consent of
Marston for a period of two years from Completion it will not and will
procure that no group undertaking of the Buyer will (except by general
advertising otherwise than by way of notice exhibited at the Site)
directly canvass, solicit or endeavour to entice away any employee of
Marston at the time of any such approach or contact who is engaged in
a managerial, sales or technical capacity.
19.6 The Seller hereby grants or will procure to be granted to the Buyer
with effect from Completion the non-exclusive right on a perpetual
basis to use, free of charge, any Intellectual Property owned by
Marston at the date of this Agreement (other than the Marston name and
mark referred to in the Permitted User Agreement) and not forming part
of the Intellectual Property Rights which is currently used in the
Business at the date of this Agreement ("the Licensed IPR") on the
following terms:
19.6.1 the Licensed IPR may only be used by the Buyer for the
purposes of the Business and to the extent and in the manner
in which it is used in the Business on the date of this
Agreement and not for any other purpose; and
19.6.2 except as provided in Clause 32 the Buyer shall not be
entitled to assign and except for the purpose of
sub-contracting the operations of the Business the Buyer
shall not be entitled to sub-license any of its rights under
this Clause 19.6 without the prior written consent of
Marston.
20 PERFORMANCE BONDS AND BANK GUARANTEES
-------------------------------------
20.1 Within 28 days after Completion, the Buyer and the Buyer's Guarantor
shall use their best endeavours to procure the absolute and
unconditional release of Marston and each other relevant member of the
Seller's Guarantor's Group from all liability (including contingent
liability) under or in respect of the performance bonds and guarantees
listed in Schedule 10 including, without limitation, by providing to
each relevant issuing bank an indemnity or indemnities in a form
acceptable to that bank,
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indemnifying each such bank against all liabilities, losses, claims,
damages, costs and expenses incurred by such relevant bank under or in
respect of such performance bonds and guarantees.
20.2 Pending release pursuant to Clause 20.1, the Buyer undertakes to
Marston (as principal and as agent and trustee for each relevant
member of the Seller's Guarantor's Group) to keep each member of the
Seller's Guarantor's Group indemnified against all liabilities arising
out of or in respect of the performance bonds and guarantees referred
to in Clause 20.1
21 VALUE ADDED TAX
---------------
21.1 All sums payable under this Agreement are exclusive of VAT.
21.2 On Completion the Seller shall issue to the Buyer a valid VAT invoice
in respect of the VAT payable in respect of the Provisional Cash
Consideration and an estimate of the value of the Assumed Liabilities
("the Estimated Assumed Liabilities").
21.3 Subject to receipt by the Buyer of a valid VAT invoice as referred to
in Clause 21.2, the Buyer shall use its reasonable endeavours to
obtain credit pursuant to section 25 VATA for the input tax in respect
of the Provisional Cash Consideration and the Estimated Assumed
Liabilities at the earliest possible date. The VAT payable in respect
of the Provisional Cash Consideration and the Estimated Assumed
Liabilities shall be paid by the Buyer by telegraphic transfer to the
account of the Seller nominated by the Seller on request by the Buyer
on the date which falls three Business Days after the date on which
the Buyer obtains credit for the input tax (whether by way of a
deduction from any output tax then due from the Buyer or by way of a
payment pursuant to section 25(3) VATA).
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21.4 If any additional Consideration is payable by the Buyer pursuant to
Clause 7.2 of this Agreement or the actual amount of the Assumed
Liabilities is in excess of the Estimated Assumed Liabilities:-
21.4.1 the Seller shall issue to the Buyer a valid VAT invoice in
respect of the VAT payable in respect of such additional
consideration on the day on which such additional
Consideration is payable;
21.4.2 the Seller shall issue to the Buyer a valid VAT invoice in
respect of the VAT payable in respect of the difference
between the actual value of the Assumed Liabilities and the
Estimated Assumed Liabilities ("the Excess") within ten
Business Days of such amount being determined; and
21.4.3 the Buyer shall use its reasonable endeavours to obtain
credit pursuant to section 25 VATA for the input tax in
respect of the additional Consideration and the Excess at
the earliest possible date and the VAT payable in respect of
such additional Consideration and the Excess shall be paid
by the Buyer by telegraphic transfer to the account of the
Seller nominated by the Seller on request by the Buyer on
the date which falls three Business Days after the date on
which the Buyer obtains credit for the input tax (whether by
way of a deduction from any output tax then due from the
Buyer or by way of a payment pursuant to section 25(3)
VATA).
21.5 If the actual amount of the Assumed Liabilities is less than the
Estimated Assumed Liabilities, then the Seller shall issue to the
Buyer a valid VAT credit note in respect of the shortfall within ten
Business Days of such amount being determined.
21.6 If any amount paid by the Buyer as representing VAT is not in fact VAT
then the Seller shall pay to the Buyer a sum equal to that amount.
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22 ENVIRONMENTAL
-------------
The provisions of Schedule 8 (Environmental) shall apply in relation
to environmental matters.
23 GUARANTEE OF BUYER'S OBLIGATIONS
--------------------------------
23.1 The Buyer's Guarantor hereby unconditionally and irrevocably
guarantees full prompt and complete performance by the Buyer of all
the Buyer's obligations under or arising out of or in connection with
this Agreement (including the prompt payment of any sums payable) and
undertakes to the Seller that if and whenever the Buyer is in default
in respect of such obligations the Buyer's Guarantor will on demand
duly and promptly perform or procure such performance of such
obligations. The Buyer's Guarantor's obligations under this Clause are
primary obligations and not those of a mere surety.
23.2 The Buyer's Guarantor will not be released from or exonerated of its
obligations hereunder nor will any such obligation be reduced,
discharged, impaired or in any way affected by any act, omission,
matter or thing (whether or not known to the Seller) including, but
without limitation:
23.2.1 any time or release or indulgence granted to or composition
with the Buyer or any other person; or
23.2.2 the existence or non-existence, or validity or invalidity,
or the taking, variation, compromise, expiry, discharge,
renewal or release of or refusal or neglect to perfect or
enforce any right, remedy or security against the Buyer or
any other person; or
23.2.3 any legal limitation, disability, incapacity or other
circumstances relating to the Buyer or any other person or
any amendment to or variation of either or both of this
Agreement or any obligations arising out of it or any other
document or security relating thereto or any assignment
thereof; or
48
<PAGE> 50
23.2.4 any other act, event or omission which would or might but
for this Clause 23.2 operate to restrict, release, impair or
discharge the Buyer's Guarantor's liability hereunder.
23.3 The guarantee contained in Clause 23.1 is a continuing guarantee and
will remain in full force and effect until the obligations and
liabilities of the Buyer under or arising out of or in connection with
this Agreement have been fully performed or been fully discharged.
23.4 Any release, compromise or discharge of the obligations of the Buyer's
Guarantor shall be deemed to be made subject to the condition that it
will be void against the Seller if any payment or security on the
faith of which it was made is set aside or proves invalid for any
reason.
23.5 Any demand or demands made pursuant to this guarantee may be made at
any time and from time to time by notice to the Buyer's Guarantor.
24 GUARANTEE OF OBLIGATIONS OF THE SELLER AND MARSTON
--------------------------------------------------
24.1 The Seller's Guarantor hereby unconditionally and irrevocably
guarantees full prompt and complete performance by the Seller of all
the obligations of the Seller and Marston under or arising out of or
in connection with this Agreement (including the prompt payment of any
sums payable) and undertakes to the Buyer that if and whenever the
Seller or Marston is in default in respect of such obligations the
Seller's Guarantor will on demand duly and promptly perform or procure
such performance of such obligations. The Seller's Guarantor's
obligations under this Clause are primary obligations and not those of
a mere surety.
24.2 The Seller's Guarantor will not be released from or exonerated of its
obligations hereunder nor will any such obligation be reduced,
discharged. impaired or in any way affected by any act, omission,
matter or thing (whether or not known to the Buyer) including, but
without limitation:
24.2.1 any time or release or indulgence granted to or composition
with the Seller or any other
49
<PAGE> 51
person; or
24.2.2 the existence or non-existence, or validity or invalidity,
or the taking, variation, compromise, expiry, discharge,
renewal or release of or refusal or neglect to perfect or
enforce any right, remedy or security against the Seller,
Marston or any other person; or
24.2.3 any legal limitation, disability, incapacity or other
circumstances relating to the Seller, Marston or any other
person or any amendment to or variation of either or both of
this Agreement or any obligations arising out of it or any
other document or security relating thereto or any
assignment thereof; or
24.2.4 any other act, event or omission which would or might but
for this Clause 24.2 operate to restrict, release, impair or
discharge the Seller's Guarantor's liability hereunder.
24.3 The guarantee contained in Clause 24.1 is a continuing guarantee and
will remain in full force and effect until the obligations and
liabilities of the Seller and Marston under or arising out of or in
connection with this Agreement have been fully performed or been fully
discharged.
24.4 Any release, compromise or discharge of the obligations of the
Seller's Guarantor shall be deemed to be made subject to the condition
that it will be void against the Buyer if any payment or security on
the faith of which it was made is set aside or proves invalid for any
reason.
24.5 Any demand or demands made pursuant to this guarantee may be made at
any time and from time to time by notice to the Seller's Guarantor.
25 ANNOUNCEMENTS
-------------
25.1 Subject to Clause 25.2 no party to this Agreement shall make or send
before or after Completion any
50
<PAGE> 52
announcement, communication or circular relating to the subject matter
of this Agreement unless such party has first obtained the other
parties' written consent to the form and text of such announcement,
such consent not to be unreasonably withheld.
25.2 Clause 25.1 does not apply to an announcement, communication or
circular:-
25.2.1 required by law or by the London Stock Exchange Limited or
by any governmental authority, in which event the party
required to make or send such announcement, communication or
circular shall, where practicable, first consult with the
other party as to its content; or
25.2.2 which, in the Seller's reasonable opinion, is required to be
given by Marston in connection with or arising out of the
transfer of the Employees pursuant to the Regulations; or
25.2.3 which in the Buyer's reasonable opinion, is necessary or
prudent to be given after Completion by the Buyer in the
conduct or management of the Business or the Employees.
25.3 The Buyer and Marston shall after execution of this Agreement jointly
send a letter in the agreed form to the customers, clients or
suppliers of the Business advising them of the change of control of
the Business and issue press releases in the agreed form announcing
the transaction and, after Completion, further press releases in a
form or forms agreed between the Buyer and Marston announcing its
Completion.
26 NOTICES
-------
26.1 Any notice or other communication pursuant to, or in connection with,
this Agreement shall be in writing and delivered personally, or sent
by first class pre-paid recorded delivery post (air mail if
51
<PAGE> 53
overseas), to the party due to receive such notice at its registered
office from time to time (or to such other address as may from time to
time have been notified in writing to the other party in accordance
with this Clause 26) or by sending it by fax to the fax number of the
party concerned set out in this Clause, or to such other fax number as
may from time to time have been notified in writing to the other party
in accordance with this Clause 26 (subject to the original notice or
communication being sent by post on the same day in the manner
specified above):-
Seller's fax number:- 0121 356 0544
Marston's fax number:- 01902 780077
Seller's Guarantor's fax number:- 0121 356 0544
Buyer's fax number:- 00 1 440 753 1491
Buyer's Guarantor's fax number:- 00 1 440 753 1491
26.2 Subject to Clause 26.3, any notice or other communication shall be
deemed to have been served:-
26.2.1 if delivered personally, when left at the address referred
to in Clause 26.1;
26.2.2 if sent by pre-paid recorded delivery post (other than air
mail), two days after posting it;
26.2.3 if sent by air mail, six days after posting it;
26.2.4 if sent by fax (subject to the original notice or
communication being sent by post on the same day in the
manner specified in Clause 26.1) upon receipt of a
confirmation of transmission slip subject to receipt during
office hours.
26.3 If a notice is given or deemed given at a time or on a date which is
not a Business Day, it shall be deemed to have been given on the next
Business Day.
27 ENTIRE AGREEMENT
----------------
52
<PAGE> 54
27.1 This Agreement (together with all documents referred to in it or
executed at Completion) constitutes the entire agreement between the
parties in relation to its subject matter and replaces and
extinguishes all prior agreements, undertakings, arrangements or
statements (in whatever form) with respect to such subject matter.
27.2 No variation of this Agreement shall be effective unless made in
writing and signed by or on behalf of all the parties to this
Agreement.
28 FURTHER ASSURANCE
-----------------
28.1 Each of Marston and the Seller shall at any time after Completion do
or procure the doing of all such acts and things and/or execute or
procure the execution of such documents in a form reasonably
satisfactory to the Buyer as the Buyer considers reasonably necessary
for the purpose of vesting the Business and all the Assets in the
Buyer or giving the Buyer the full benefit of all the provisions of
this Agreement and the Buyer shall at its own cost be responsible for
preparing the requisite documentation and all reasonable fees and
expenses associated therewith.
28.2 Within seven days of the execution of this Agreement the parties shall
jointly, to the extent they have not already done so, approach each
third party licensor of any software used in the Business under any
licence in existence at the date of this Agreement in order to procure
(as appropriate):-
28.2.1 for the Buyer the right to use such software from
Completion; and/or
28.2.2 for Marston the right to provide data processing services to
the Buyer from Completion.
29 INVALIDITY
----------
53
<PAGE> 55
If any provision of this Agreement is held to be unenforceable or
illegal, in whole or in part, such provision or part shall to that
extent be deemed not to form part of this Agreement but the
enforceability of the remainder of this Agreement shall remain
unaffected.
30 EFFECT OF COMPLETION
--------------------
This Agreement and in particular the Warranties in so far as any of
its provisions remain to be, or are capable of being, performed or
observed, shall remain in full force and effect after Completion.
31 COSTS
-----
Each party to this Agreement shall pay its own costs in relation to
the negotiation, preparation, execution and implementation of this
Agreement and of each document referred to in this Agreement. Should
the Buyer wish to record with the relevant authorities its title to
the registered Intellectual Property Rights, the Buyer shall be
responsible for preparing and filing with such authorities the
requisite documentation, including without limitation any confirmatory
assignments that may be required, and shall pay all fees and expenses
associated therewith and the Seller and Marston shall co-operate with
the Buyer in this endeavour.
32 ASSIGNMENT
----------
This Agreement is personal to the parties and neither it nor any
benefit arising under it may be assigned without the prior written
consent of the other party and neither party shall purport to assign
or transfer the same provided that after Completion the Buyer may
assign, without consent, any or all of its rights under this Agreement
to:-
32.1 the purchaser of substantially all of the Buyer's assets and business;
or
32.2 any of its Associated Companies (provided that if the assignee ceases
to be an Associated Company of the Buyer, the rights transferred
pursuant to this Clause shall be transferred to another Associated
Company of the Buyer, failing which such rights will lapse)
54
<PAGE> 56
but any assignment hereunder shall in no way operate to increase
Marston's or the Seller's or the Seller's Guarantor's obligations
under this Agreement.
33 RTPA
----
No party shall give effect to or enforce any restrictions contained in
this Agreement or any agreement or arrangement of which this Agreement
forms part and by virtue of which particulars of this Agreement (or
the relevant agreement or arrangement) are required to be furnished
under the RTPA until particulars have been duly furnished to the
Director General of Fair Trading as required by the RTPA.
34 COUNTERPARTS
------------
This Agreement may be executed in any number of counterparts and by
each of the parties on separate counterparts each of which when
executed and delivered shall be deemed to be an original, but all the
counterparts together shall constitute one and the same agreement.
35 LAW AND JURISDICTION
--------------------
35.1 This Agreement shall be governed by and construed in accordance with
the laws of England.
35.2 The parties hereby submit to the exclusive jurisdiction of the High
Court of England in relation to any dispute or claim arising out of or
in connection with this Agreement.
35.3 The Buyer's Guarantor's address for service of proceedings in the High
Court of England shall be the company secretary, Chart Marston Limited
at its registered office for the time being with a copy to Wragge &
Co, 55 Colmore Row, Birmingham B3 2AS (Ref: IRM) or such other address
in England as may be notified to the other parties to this Agreement
in accordance with the provisions of Clause 26.
55
<PAGE> 57
SIGNED by or on behalf of the parties on the date which first appears in this
Agreement.
56
<PAGE> 58
The following schedules have been omitted pursuant to Item 601(b)(2) of
Regulation S-K. A copy of any omitted schedule shall be furnished to the
Securities and Exchange Commission upon request.
Schedule Description
- -------- -----------
1 The Employees
2 Part I - Tangible Assets
Part II - Excluded Tangible Assets
Part III - Leased Assets
Part IV - Excluded Debts
3 Warranties
4 Part I - Registered Intellectual Property Rights
Part II - IP Licence Agreements
5 Part I - The Freehold Property
Part II - The Leasehold Property
Part III - The Site
Part IV - Detailed Property Provisions
6 Completion Accounts
7 Pension Provisions
8 Environmental
9 Part I - Agency Contracts
Part II - Customer Contracts
Part III - Finance Agreements
Part IV - Foreign Exchange Contracts
Part V - Supplier Contracts
10 Performance Bonds and Guarantees
<PAGE> 59
SIGNED by Paul Boulton ) /s/ Paul Boulton
for and on behalf of ) IMI KYNOCH LIMITED
IMI KYNOCH LIMITED ) Acting by its Attorney,
in the presence of:- ) Paul Boulton
Signature of Witness: /s/ Duncan B. Reid
Name of Witness: Duncan Reid
Address: Pinsent Curtis
Birmingham
SIGNED by ) /s/ Nick Prosser
for and on behalf of ) IMI Marston Limited
IMI MARSTON LIMITED ) Acting by its Attorney,
in the presence of:- ) Nick Prosser
Signature of Witness: /s/ Duncan B. Reid
Name of Witness: Duncan Reid
Address: Pinsent Curtis
Birmingham
SIGNED by Paul Boulton ) /s/ Paul Boulton
for and on behalf of ) IMI plc Acting by its
IMI PLC in the presence of:- ) Attorney, Paul
Boulton
Signature of Witness: /s/ Duncan B. Reid
Name of Witness: Duncan Reid
Address: Pinsent Curtis
Birmingham
<PAGE> 60
SIGNED by a duly authorised officer )
for and on behalf of )
CHART MARSTON LIMITED ) /s/ Arthur S. Holmes
in the presence of:- )
Signature of Witness: /s/ A. Goldsworthy
Name of Witness: A. Goldsworthy
Address: 55 Colmore Row
Birmingham
B3 2AS
SIGNED by a duly authorised officer ) /s/ James R. Sadowski
for and on behalf of )
CHART INDUSTRIES INC )
in the presence of:- )
Signature of Witness: /s/ A. Goldsworthy
Name of Witness: A. Goldsworthy
Address: 55 Colmore Row
Birmingham
B3 2AS
<PAGE> 61
<TABLE>
<CAPTION>
CONTENTS
CLAUSE PAGE
- ------ ----
<S> <C>
1 INTERPRETATION............................................................................1
2 SALE OF THE BUSINESS AND THE ASSETS......................................................15
3 EXCLUDED ITEMS...........................................................................17
4 CONSIDERATION............................................................................18
5 PRIOR TO COMPLETION......................................................................20
6 COMPLETION...............................................................................23
7 COMPLETION ACCOUNTS......................................................................25
8 WARRANTIES...............................................................................26
9 LIMITATION ON WARRANTIES.................................................................27
10 RISK AND TITLE..........................................................................33
11 POSITION AFTER COMPLETION...............................................................33
12 PROTECTION OF GOODWILL..................................................................34
13 NAMES...................................................................................36
14 EMPLOYEE................................................................................38
15 PENSION ARRANGEMENTS....................................................................40
16 LIABILITIES.............................................................................40
17 CONTRACTS AND PERMITS...................................................................40
18 PRODUCT WARRANTY COMMITMENTS............................................................41
19 CONFIDENTIALITY AND NON-SOLICITATION....................................................44
20 PERFORMANCE BONDS AND BANK GUARANTEES...................................................45
21 VALUE ADDED TAX.........................................................................46
22 ENVIRONMENTAL...........................................................................48
23 GUARANTEE OF BUYER'S OBLIGATIONS........................................................48
24 GUARANTEE OF OBLIGATIONS OF THE SELLER AND MARSTON......................................49
25 ANNOUNCEMENTS...........................................................................50
26 NOTICES.................................................................................51
27 ENTIRE AGREEMENT........................................................................52
28 FURTHER ASSURANCE.......................................................................53
29 INVALIDITY..............................................................................53
30 EFFECT OF COMPLETION....................................................................54
31 COSTS...................................................................................54
32 ASSIGNMENT..............................................................................54
33 RTPA....................................................................................55
34 COUNTERPARTS............................................................................55
35 LAW AND JURISDICTION....................................................................55
SCHEDULE 1 THE EMPLOYEES...................................................................57
SCHEDULE 2 PART I TANGIBLE ASSETS..........................................................58
PART II EXCLUDED TANGIBLE ASSETS...........................................................59
PART III LEASED ASSETS.....................................................................59
PART IV EXCLUDED DEBTSA debt in the sum of (pound)697,000 owed to the Seller from Amoco
Canada Petroleum Company Limited...........................................................59
SCHEDULE 3 WARRANTIES......................................................................60
1 CAPACITY AND AUTHORITY...................................................................60
2 INFORMATION..............................................................................60
3 ACCOUNTS.................................................................................60
4 CHANGES SINCE THE ACCOUNTS DATE..........................................................61
5 ASSETS...................................................................................62
6 INTELLECTUAL PROPERTY....................................................................64
7 INSURANCE................................................................................65
8 CONTRACTS................................................................................66
9 INSIDER AGREEMENTS.......................................................................68
10 TERMS OF TRADE AND BUSINESS.............................................................68
11 LICENCES AND CONSENTS...................................................................70
</TABLE>
<PAGE> 62
<TABLE>
<S> <C>
12 COMPETITION.............................................................................70
13 INSOLVENCY..............................................................................72
14 LITIGATION AND COMPLIANCE WITH LAW......................................................73
15 EMPLOYEES...............................................................................74
16 PENSIONS................................................................................76
17 TAXATION................................................................................78
18 PROPERTY................................................................................80
19 ENVIRONMENTAL MATTERS...................................................................81
SCHEDULE 4 PART I REGISTERED INTELLECTUAL PROPERTY RIGHTS..................................83
PART IIIP LICENCE AGREEMENTS...............................................................84
SCHEDULE 5 PART I THE FREEHOLD PROPERTY....................................................85
PART II THE LEASEHOLD PROPERTY.............................................................85
PART III THE SITE..........................................................................85
PART IV DETAILED PROPERTY PROVISIONS.......................................................85
1 INTERPRETATION...........................................................................85
2 TITLE....................................................................................89
3 SUBJECTIONS..............................................................................89
4 CAPACITY.................................................................................91
5 COMPLETION...............................................................................91
6 INSURANCE................................................................................92
7 STANDARD CONDITIONS - AMENDMENTS.........................................................94
8 APPORTIONMENTS OF RENTS AND OTHER INCOME................................................95
9 OUTSTANDING SUMS DUE FROM TENANTS........................................................96
10 MANAGEMENT PENDING AND AFTER COMPLETION.................................................98
11 MANUALS, PLANS ETC......................................................................99
12 THE TRANSFER............................................................................99
13 DOCUMENTS AND RECORDS..................................................................100
14 THE NEW LEASES.........................................................................100
15 THE WORKSHOP LEASE.....................................................................100
16 THE NEW LEASES.........................................................................100
SCHEDULE 6 COMPLETION ACCOUNTS PART I - PROCEDURE.........................................103
PART II - THE COMPLETION ACCOUNTS.........................................................104
SCHEDULE 7 PENSION PROVISIONS.............................................................108
SCHEDULE 8 ENVIRONMENTAL..................................................................109
SCHEDULE 9 CONTRACTS......................................................................116
PART I AGENCY CONTRACTS PART II CUSTOMER CONTRACTS........................................117
PART III FINANCE AGREEMENTS...............................................................118
PART IV FOREIGN EXCHANGE CONTRACTS PART V SUPPLIER CONTRACTS..............................119
SCHEDULE 10 PERFORMANCE BONDS AND GUARANTEES..............................................120
</TABLE>
ANNEXURES
Actuary's Letter (Schedule 7, para 1)
- -------------------------------------
AGREED FORM DOCUMENTS
Central Services Agreement (Clause 1.1)
- ---------------------------------------
Disclosure Letter (Clause 1.1)
- ------------------------------
Leases (Clause 1.1)
- -------------------
Permitted User Agrement (Clause 1.1)
- ------------------------------------
Opinion Letter (Clause 5.7.1)
- -----------------------------
Deed of indemnity (Clause 6.2.7)
- --------------------------------
Letters Re Change of Control of Business and Press Releases (Clause 25.3)
- -------------------------------------------------------------------------
Transfer (Schedule 5, para 12.1)
- --------------------------------
<PAGE> 1
Exhibit 10.1
EXECUTION COPY
SECOND AMENDMENT
TO
CREDIT AGREEMENT
This Second Amendment (this "Amendment") is executed at Cleveland, Ohio
as of March 5, 1998 by and among CHART INDUSTRIES, INC. (referred to hereinafter
as the "Parent"), ALTEC INTERNATIONAL LIMITED PARTNERSHIP ("ALTEC"), ALTEC, INC.
("AI"), CHART MANAGEMENT COMPANY, INC. ("Chart Management"), CHART INDUSTRIES
FOREIGN SALES CORPORATION ("Chart Foreign"), GREENVILLE TUBE CORPORATION
("Greenville"), PROCESS SYSTEMS INTERNATIONAL, INC. ("PSI"), CRYENCO SCIENCES,
INC. ("Sciences") and CRYENCO, INC. ("CI") (the Parent, ALTEC, AI, Chart
Management, Chart Foreign, Greenville, PSI, Sciences and CI being referred to
collectively as the "Borrowing Group") and NATIONAL CITY BANK ("NCB") and NBD
BANK ("NBD") (NCB and NBD being referred to collectively as the "Banks" and
singly as a "Bank") and NATIONAL CITY BANK, as agent for the Banks (the
"Agent").
WHEREAS, the Borrowing Group, Banks and Agent entered into a Credit
Agreement dated as of July 29, 1997, as amended by a First Amendment to Credit
Agreement dated as of October 8, 1997 (the "Credit Agreement"; all terms used in
the Credit Agreement being used herein with the same meaning); and
WHEREAS, the Borrowing Group, Banks and Agent want to make certain
changes in the Credit Agreement;
NOW, THEREFORE, the Borrowing Group, Banks and Agent agree as follows:
1. The "Whereas" clause on page 1 of the Credit Agreement is hereby
deleted and replaced with the following:
"WHEREAS, the Borrowing Group desires to obtain from
the Banks an unsecured revolving credit facility (the "Credit
Facility") in a principal amount not to exceed FORTY FIVE
MILLION DOLLARS ($45,000,000) less the face amount of any
outstanding letters of credit and foreign bank guaranties
including (i) a revolving loan that may be borrowed, repaid
and
<PAGE> 2
reborrowed, (ii) standby letters of credit in an aggregate
stated amount not to exceed FIFTEEN MILLION DOLLARS
($15,000,000), and (iii) a multi-currency credit facility in
pounds sterling in an aggregate stated amount not to exceed
THIRTY FIVE MILLION DOLLARS ($35,000,000), all upon the terms
and conditions set forth hereafter ((i) and (iii) are
hereinafter jointly referred to as the "Revolving Loan")."
2. The following new definitions are hereby added to Section 1.01 of
the Credit Agreement:
"Dollar Equivalent" shall mean, at any time, and at each time a
determination is required, as determined by the Agent (which
determination shall be conclusive absent manifest error), an equivalent
amount of Pounds Sterling expressed in dollars.
"Pounds Sterling" means the lawful currency of the United Kingdom, if
at the time such currency is readily and freely transferable and
convertible into Dollars.
"Pounds Sterling Agent" means a lending institution located in the
United Kingdom, designated by the Agent.
"Pounds Sterling Credit Facility" means a portion of the Credit
Facility pursuant to which the Parent, but no other member of the
Borrowing Group, may obtain Advances in Pounds Sterling in any
aggregate principal amount not to exceed the Dollar Equivalent of
$35,000,000 at any time. The Pounds Sterling Credit Facility shall be a
part of, and NOT SEPARATE FROM OR INDEPENDENT OF, the Credit Facility,
and the Pounds Sterling Credit Facility shall be subject to all the
terms and provisions applicable to the Credit Facility.
3. The following Sections of the Credit Agreement are hereby amended as
follows:
SECTION 1.01 The definition "Banks" is hereby amended by
adding the following phrase at the end of the existing definition:
", and shall include any office, branch, subsidiary, or
affiliate of each named Bank, as selected by such Bank".
The definition "Borrowing Group" shall hereafter include Chart
International, Inc., a Delaware corporation.
2
<PAGE> 3
The definition "Libor Margin" is hereby amended by deleting the
performance grid contained therein and replacing it with the following:
<TABLE>
<CAPTION>
Level Borrowed Fixed LIBOR Plus Letter of Facility Fee
Debt/Net Charge (basis Credit (basis
Worth Coverage points) Pricing (%) points)
Ratio
<S> <C> <C> <C> <C> <C>
Less than or Greater than or
1 equal to 1.00 equal to 2.61 62.5 .625 .375
2 1.00 to 1.35 2.16 to 2.60 87.5 .875 .375
3 1.36 to 1.70 1.71 to 2.15 112.5 1.125 .375
4 1.71 to 2.00 1.26 to 1.70 137.5 1.125 .375
</TABLE>
SECTION 1.03 The following new Section 1.03, entitled
"CURRENCY EQUIVALENTS" is added to Article I of the Credit Agreement:
Section 1.03 CURRENCY EQUIVALENTS. For purposes of this
Agreement, except as otherwise specified herein, the equivalent in
Dollars of any Pounds Sterling and the equivalent in Pounds Sterling of
any Dollars shall be determined by using the quoted spot rate at which
the Agent offers to exchange Dollars for such Pounds Sterling or Pounds
Sterling for such Dollars, as applicable, at its office in Cleveland,
Ohio at 9:00 A.M. two Business Days prior to the Date on which such
equivalent is to be determined; provided, that the equivalent in
Dollars of each Advance made in Pounds Sterling shall be recalculated
hereunder on each date that it shall be necessary (or the Agent shall
elect) to determine the unused portion of each Bank's Commitment, of
any or all Revolving Loans outstanding on such date.
SECTION 2.01 The following sentence is added after the second
sentence of Section 2.01:
"Included as part of, but not in addition to, the forty-five
million dollar amount of the Commitments is the Pounds Sterling Credit
Facility, and Advances in Pounds Sterling may be obtained by the Parent
in accordance with the terms and provisions of this Credit Agreement,
provided that all Revolving Loans made as part of the same Borrowing by
the Borrowing Group (or the Parent, as applicable) shall, unless
otherwise specifically provided herein, consist of Revolving Loans of
the same type
3
<PAGE> 4
and currency; and provided, further, that the aggregate outstanding
principal amount of Revolving Loans to the Parent denominated in Pounds
Sterling shall not exceed $35,000,000 at any time outstanding."
SECTION 2.04 The following sentence is added after the second
sentence of Section 2.04:
"Each Advance in Pounds Sterling shall be in an amount of not
less than (pound)1,000,000, or multiples of (pound)500,000 in excess
thereof, and at no time shall there be more than four (4) Borrowings in
Pounds Sterling outstanding hereunder."
The following sentence is added after the fourth
sentence of Section 2.04 (not taking into account the immediately
preceding amendment):
"Whenever the Parent desires an Advance in Pounds Sterling,
the Parent shall give the Agent prior to 11:00 A.M. (EST), at least
four Business Days' prior written or telephonic notice (in the case of
telephonic notice, promptly confirmed in writing if so requested by the
Agent) of each Borrowing of Revolving Loans consisting of Pounds
Sterling."
The following additional paragraphs are added at
the end of Section 2.04:
"In the case of a proposed Borrowing comprised of Revolving
Loans which are denominated in Pounds Sterling, the obligation of each
Bank to make its pro rata share of the Revolving Loan in Pounds
Sterling as part of such Borrowing is subject to the confirmation by
the Agent to the Parent not later than the fourth Business Day before
the requested date of such Borrowing that Pounds Sterling is readily
and freely transferable and convertible into Dollars. If the Agent
shall not have provided the confirmation referred to above, the Agent
shall promptly notify the Parent, whereupon the Parent may, by notice
to the Agent not later than the third Business Day before the requested
date of such Borrowing, withdraw its request relating to such requested
Borrowing. If the Parent does so withdraw such request, the Borrowing
requested shall not occur and the Agent shall promptly so notify each
Bank. If the Parent does not so withdraw such request, the Agent shall
promptly so notify each Bank and such request shall be deemed to be a
request for a Borrowing which requests a Borrowing of Revolving Loans
in an aggregate amount in Dollars equivalent, on the date the Agent so
notifies each Bank, to the amount of the originally requested Borrowing
in Pounds Sterling, and in such notice by the Agent to each Bank, the
Agent shall state
4
<PAGE> 5
such aggregate equivalent amount of such Borrowing in Dollars and such
Bank's ratable portion of such Borrowing.
No later than 2:00 P.M. (EST) on the date specified in each
request for Advance, subject to the notice requirements set forth
herein, each Bank will make available its pro rata share of each
Borrowing requested to be made on such date in the manner provided
below. All amounts relating to any Borrowing by the Borrowing Group or
the Parent (with respect to the Pounds Sterling Credit Facility) shall
be made available to the Agent in Dollars or to the Pounds Sterling
Agent in Pounds Sterling, as applicable, in immediately available funds
at the Agent's office in Cleveland, Ohio or at the office of the Pounds
Sterling Agent in the United Kingdom, with respect to a Borrowing under
the Pounds Sterling Facility, and the Agent or the Pounds Sterling
Agent, as applicable, promptly will make available to the Borrowing
Group, or the Parent, as applicable, by depositing to its account with
the Agent, or at such other account in another financial institution
designated by the Borrowing Group or the Parent, as applicable, to the
Agent, or to the Pounds Sterling Agent, as applicable, the aggregate of
the amounts so made available in the currency and type of funds
received.
With respect to any Borrowing in Dollars only, unless the
Agent shall have been notified by either Bank prior to the date of a
Borrowing that such Bank does not intend to make available to the Agent
its portion of the Borrowing or Borrowings to be made on such date, the
Agent may assume that such Bank has made such amount available to the
Agent on such date of Borrowing, and the Agent, in reliance upon such
assumption, may (in its sole discretion and without any obligation to
do so) make available to the Borrowing Group or the Parent, as
applicable, a corresponding amount. If such corresponding amount is not
in fact made available to the Agent by such Bank and the Agent has made
available same to the Borrowing Group or the Parent, as applicable, the
Agent shall be entitled to recover such corresponding amount from such
Bank. If such Bank does not pay such corresponding amount forthwith
upon the Agent's demand therefor, the Agent shall promptly notify the
Borrowing Group and the Borrowing Group shall immediately pay such
corresponding amount to the Agent. The Agent shall also be entitled to
recover from such Bank or the Borrowing Group, as the case may be,
interest on such corresponding amount in respect of each day from the
date such corresponding amount was made available by the Agent to the
Borrowing Group or the Parent, as applicable, to the date such
corresponding amount is recovered by the Agent at a rate per annum
equal to (x) if paid by such Bank, at the overnight Federal Funds
Effective Rate, in the case of any Revolving Loan denominated in
Dollars, or at the weighted
5
<PAGE> 6
average overnight or weekend borrowing rate for immediately available
and freely transferrable funds in Pounds Sterling which is offered to
the Agent in the international markets, in the case of any Revolving
Loan denominated in Pounds Sterling, or (y) if paid by the Borrowing
Group, the then applicable rate of interest, calculated in accordance
with Section 2.05, for the respective Revolving Loan (but without any
requirement to pay any amounts in respect thereof pursuant to Section
2.10)."
SECTION 2.26 The heading "(i)" is inserted at the beginning of
the first paragraph and the following paragraphs are added as numbers
(ii) and (iii):
"(ii) If for the purposes of obtaining judgment in
any court or calculating any fee payable under this Credit
Agreement it is necessary to convert a sum due hereunder or
under a Revolving Note or any other sum in any currency (the
"Original Currency") into another currency (the "Other
Currency"), the parties hereby agree, to the fullest extent
permitted by law, that the rate of exchange used shall be that
at which in accordance with normal banking procedures each
Bank or (as applicable) the Agent (in its capacity as Agent)
could purchase the Original Currency with the Other Currency
after any premium and costs of exchange on the Business Day
preceding that on which final judgment is given or any fee is
to be paid.
(iii) The obligation of the Borrowing Group in
respect of any sum due from them to any Bank hereunder shall,
notwithstanding any judgment in an Other Currency, whether
pursuant to a judgment or otherwise, be discharged only to the
extent that, on the Business Day following receipt by any Bank
of any sum adjudged to be so due in such Other Currency, such
Bank may in accordance with normal banking procedures purchase
the Original Currency with such Other Currency. If the amount
of the Original Currency so purchased is less than the sum
originally due to such Bank in the Original Currency, the
applicable Borrower agrees, as a separate obligation and
notwithstanding any such judgment or payment, to indemnify
such Bank against such loss."
SECTION 2.17. Section 2.17 is hereby deleted and replaced with the
following:
FACILITY FEE. The Borrowing Group shall pay to the Agent for
the ratable benefit of the Banks a facility fee at the per
annum rate set forth in the performance grid on the average
daily
6
<PAGE> 7
amount of each Commitment of such Bank, whether used or
unused; to be paid quarterly in arrears commencing on March
31, 1998, and thereafter on the last day of each Quarter and
on the termination of the Commitments.
SECTION 2.19 Section 2.19(b) is hereby deleted and replaced with the
following:
(b) NBD agrees that so long as (i) all of the Commitments
remain in effect, and (ii) NBD has an affiliate(s) which
issues Bank Guaranties, NBD's affiliate will, in NBD's name,
issue such Bank Guaranties for the account of any member of
the Borrowing Group if such member may from time to time
request subject, however, to the conditions of this Agreement.
SECTION 2.31 The following new Section 2.31, entitled "VOLUNTARY
CONVERSION OF DOLLAR DENOMINATION REVOLVING LOANS; REDENOMINATION OF REVOLVING
LOANS.", is added at the end of Article II:
"Section 2.31 VOLUNTARY CONVERSION OF DOLLAR DENOMINATION
LOANS; REDENOMINATION OF REVOLVING LOANS. (a) The Borrowing Group shall
have the option to convert on any Business Day all or a portion at
least equal to the applicable minimum Borrowing amount of the
outstanding principal amount of its Revolving Loans denominated in
Dollars and bearing interest at an Interest Option into a Borrowing or
Borrowings at the other Interest Option, provided that: (i) no partial
conversion of a Borrowing shall reduce the outstanding principal amount
of any such Borrowing to less than the minimum Borrowing amount
applicable thereto; (ii) any conversion from the Overall Libor Rate to
the Base Rate shall be made on, and only on, the last day of an
Interest Period for such Borrowing; (iii) any Borrowing at the Base
Rate may only be converted into a Borrowing at the Overall Libor Rate
if no Event of Default is in existence on the date of the conversion
unless the Banks otherwise agree; and (iv) Borrowings under the Overall
Libor Rate resulting from this Section 2.31 shall conform to the
requirements of Section 2.04. Each such conversion shall be effected by
the Borrowing Group giving the Agent at its principal place of
business, prior to 11:00 A.M. (EST), at least three (3) business days'
prior written notice (or telephonic notice promptly confirmed in
writing if so requested by the Agent), specifying the Revolving Loan to
be so converted, and the Interest Option to be converted into and, if
to be converted into a borrowing at the Overall Libor Rate, the
Interest Period to be initially applicable thereto. The Agent shall
give each Bank prompt notice of any such proposed conversion affecting
any of its Revolving Loans.
7
<PAGE> 8
For the avoidance of doubt, the prepayment or repayment of any
Revolving Loans out of the proceeds of other Revolving Loans by the
Borrowing Group is not considered to be a conversion of a revolving
into other Revolving Loans.
(b) The Parent may, upon notice to the Agent at least five (5)
business days prior to the date of the proposed redenomination, request
that all Revolving Loans comprising the same Borrowing by the Parent be
redenominated from Dollars into Pounds Sterling, or from Pounds
Sterling into Dollars; provided, however, that any redenomination of a
Revolving Loan bearing interest at the Overall Libor Rate shall be made
on, and only on, the last day of an Interest Period for such Revolving
Loan; and provided, further, that no redenomination shall be made which
would cause any Revolving Loan bearing interest at the Base Rate to be
denominated in any currency other than Dollars. Each such notice of
request of a redenomination shall be by telecopier, telex or cable
(confirmed immediately in writing if so requested by the Agent),
specifying (i) the Revolving Loans comprising the Borrowing to be
redenominated, (ii) the date of the proposed redenomination (which
shall be a business day), (iii) the currency into which such Revolving
Loan is to be redenominated, and (iv) if such Revolving Loan if so
redenominated is to bear interest at the Overall Libor Rate, the
denomination of the Interest Period for such Revolving Loan upon being
so redenominated. The Agent shall promptly notify each Bank of any such
requested redenomination. In the case of a request for redenomination
into Pounds Sterling, such redenomination is subject to the
confirmation by each Bank to the Agent, not later than the third
business date of such redenomination that such Bank agrees to such
redenomination, which confirmation shall be notified immediately by the
Agent to the Parent. If any Bank shall not have so provided to the
Agent such confirmation, the requested redenomination will not occur
and the Agent shall promptly notify the Parent and each Bank that a
Bank has not provided such confirmation and that the requested
redenomination will not occur. If each Bank shall have so provided the
Agent such confirmation or if such request is for a redenomination into
Dollars, each Revolving Loan so requested to be redenominated will be
redenominated, on the date specified therefor in such notice of
redenomination, into an equivalent amount thereof in the currency
requested in such notice of redenomination, such equivalent amount to
be determined in accordance with Section 1.03, and in the case of any
such Revolving Loan being so redenominated which will bear interest at
the Overall Libor Rate, such Revolving Loan will have an initial
Interest Period as requested in such notice of redenomination.
SECTION 2.28. The following clause is added at the end of Section 2.28:
8
<PAGE> 9
(iii) The proceeds of the Pounds Sterling Credit Facility
shall be used by the Parent to finance the acquisition of the assets of
IMI Kynoch Ltd., a United Kingdom Limited liability company and for
general corporate purposes in accordance with the provisions of this
Credit Agreement.
ARTICLE VII. With respect to the negative covenants contained in
Article VII, Chart UK Investments Limited Partnership and Chart Marston Ltd. are
hereby excepted from all exclusions from such negative covenants in each case
where CHD is excepted from the exclusions from such negative covenants.
SECTION 7.01. The following clause is added as new subsection 7.01
(xi):
"(xi) any Indebtedness for Borrowed Money incurred by Chart
Marston Ltd. for purposes of covering overdrafts and providing
sufficient cash flow for such subsidiary, from a lending
institution in the United Kingdom, so long as the amount
thereof does not exceed (pound)500,000."
SECTION 7.04 Section 7.04 (iii) is hereby amended by deleting the
reference to the sum of "Nine Hundred Twenty Five Thousand dollars ($925,000)"
and replacing it with the sum "Two Million Dollars ($2,000,000)"
In addition, the Banks hereby waive any default of Section 7.04 of the
Credit Agreement which arose during Fiscal Year 1997 as a result of the
aggregate annual rentals of all leases of the Companies exceeding $925,000, to
the extent such default is due to the Cryenco Acquisition.
SECTION 7.05 Section 7.05 is hereby amended by deleting the reference
to "Ten Million Dollars ($10,000,000)" in Section 7.05(v)(B) and replacing it
with the sum "Six Million Dollars ($6,000,000)."
The following clause is added at the end of Section 7.05(vi):
"and an Investment by Chart International, Inc. in the equity
securities of Chart Marston Ltd., not to exceed
(pound)21,000,000.
The following clause is added as new Section 7.05(x):
9
<PAGE> 10
"any Guarantee by Chart International, Inc. of any current
liability owing by Chart Marston Ltd., not to exceed
(pound)500,000".
SECTION 7.11 The following clause is added at the end of Section 7.11:
"except that this Section 7.11 shall not prohibit the
acquisition by Chart Marston Ltd. of the assets of IMI Kynoch
Ltd. for a sum not to exceed (pound)21,000,000."
SECTION 7.12 The following sentence is added at the end of Section
7.12:
"Notwithstanding the foregoing, during each of Fiscal Years
1998 and 1999 only, the Companies will be permitted to make
Capital Expenditures in an amount not to exceed Eight Million
Dollars ($8,000,000), determined on a Consolidated basis."
In addition, the Banks hereby waive any default of Section 7.12 of the
Credit Agreement which arose during Fiscal Year 1997 as a result of Capital
Expenditures in excess of the maximum amount permitted under Section 7.12, to
the extent such default is due to the purchase of the assets financed by
performance of that certain Loan Agreement dated July 1, 1996 among GE Capital
Public Finance, Inc., the City of LaCrosse, Wisconsin and ALTEC.
SECTION 7.19 Section 7.19 is hereby amended by deleting the reference
to "Eighteen Million Dollars" ($18,000,000) and replacing it with "Forty-One
Million Dollars" ($41,000,000).
SCHEDULE 4.01 Schedule 4.01 of the Credit Agreement is hereby deleted
and replaced with Schedule 4.01 attached hereto and incorporated herein.
SCHEDULE 7.05 Schedule 7.05 of the Credit Agreement is hereby deleted
and replaced with Schedule 7.05 attached hereto and incorporated herein.
4. CONDITIONS PRECEDENT. It is a condition precedent to the
effectiveness of this Amendment that, prior to or on the date hereof, (as to
items (A) and (E)(1) and (3), below); and prior to or on the date of funding the
first Advance under the Pounds Sterling Credit Facility (as to items (B), (C),
(D), (E)(2), (F), (G) and (H) below), the following items shall have been
delivered to Agent (in form and substance acceptable to Banks):
10
<PAGE> 11
(A) a counterpart original of this Amendment executed by Chart
International, Inc., evidencing that Chart International, Inc. is a new
member of the Borrowing Group as of the date hereof.
(B) a counterpart original of this Amendment executed by Chart
UK Investments Limited Partnership and by Chart Marston Ltd.,
acknowledging that each such entity is a "Company" and a "Subsidiary"
pursuant to the Credit Agreement, as amended hereby, and therefore
bound by the negative covenants contained in Article VII of the Credit
Agreement, as amended hereby and the other terms and conditions
applicable to Companies and Subsidiaries thereunder.
(C) a letter from Borrower's counsel setting forth the
structure of the purchase of the assets of IMI Kynoch Ltd. and the
reasons that CHD, Inc., Chart UK Investments Limited Partnership, and
Chart Marston Ltd, cannot be members of the Borrowing Group.
(D) a Stock Pledge Agreement executed by Chart International,
Inc. pledging sixty-six percent (66%) of the stock of Chart Marston
Ltd. as security for the Credit Facility, and original share
certificate(s), along with an executed stock power(s), perfecting the
Agent's security interest in such stock.
(E) a Certificate of the secretary of each member of the
Borrowing Group certifying (1) that such Borrower's Articles of
Incorporation and Code of Regulations have not been amended since the
execution of the Credit Agreement (or certifying that true, correct and
complete copies of any amendments are attached), (2) that copies of
resolutions of the Board of Directors of such Borrower are attached
with respect to the approval of this Amendment and of the matters
contemplated hereby and authorizing the execution, delivery and
performance by such Borrower of this Amendment and each other document
to be delivered pursuant hereto and (3) as to the incumbency and
signatures of the officers of such Borrower signing this Amendment and
each other document to be delivered pursuant hereto;
(F) copies of the organizational documents for each of Chart
UK Investments Limited Partnership and Chart Marston Ltd.;
(G) reimbursement of all of Agent's out of pocket fees and
expenses, including, without limitation attorneys' fees in
consideration of Agent's preparation of this Amendment and its
agreements herein;
11
<PAGE> 12
(H) such other documents as Agent may request to implement
this Amendment and the transactions contemplated hereby.
If Banks and Agent shall consummate the transactions contemplated hereby prior
to the fulfillment of any of the conditions precedent set forth above, the
consummation of such transactions shall constitute only an extension of time for
the fulfillment of such conditions and not a waiver thereof.
5. REPRESENTATIONS AND WARRANTIES. Borrower hereby represents and
warrants to Bank that:
(A) none of the representations and warranties made in Section
6.01 of the Credit Agreement has ceased to be true and complete in any
material respect as of the date hereof; and
(B) as of the date hereof no "Possible Default" has occurred
that is continuing.
6. ACKNOWLEDGMENTS CONCERNING OUTSTANDING LOANS. The Borrowing Group
acknowledges and agrees that, as of the date hereof, all of their outstanding
Obligations to Banks are owed without any offset, defense, claim or counterclaim
of any nature whatsoever.
7. WAIVER. Banks and Agent hereby waive the provisions of Sections 7.01
and 7.05 of the Credit Agreement to the extent that those Sections would
prohibit the Parent from obtaining the foreign exchange facilities referred to
in this Amendment.
8. REFERENCES. On and after the effective date of this Amendment, each
reference in the Credit Agreement to "this Agreement", "hereunder", "hereof", or
words of like import referring to the Credit Agreement, and each reference in
the Revolving Notes or other Loan Documents to the "Credit Agreement",
"thereof", or words of like import referring to the Credit Agreement shall mean
and refer to the Credit Agreement as amended hereby. The Credit Agreement, as
amended by this Amendment, is and shall continue to be in full force and effect
and is hereby ratified and confirmed in all respects. The execution, delivery
and effectiveness of this Amendment shall not operate as a waiver of any right,
power or remedy of Banks or Agent under the Credit Agreement or constitute a
waiver of any provision of the Credit Agreement except as specifically set forth
herein.
9. COUNTERPARTS AND GOVERNING LAW. This Amendment may be executed in
any number of counterparts, each counterpart to be executed by one or more of
the parties but, when taken together, all counterparts shall constitute one
agreement. This Amendment, and the respective rights and obligations of the
parties hereto, shall be construed in accordance with and governed by Ohio law.
12
<PAGE> 13
IN WITNESS WHEREOF, the Borrowing Group, Banks and Agent have executed
this Amendment at the time and place first above mentioned.
<TABLE>
<CAPTION>
CHART INDUSTRIES, INC. PROCESS SYSTEMS INTERNATIONAL,
INC.
<S> <C>
By: /s/ Don A. Baines By: /s/ Don A. Baines
----------------------------------- ------------------------------------
Don A. Baines, Treasurer and CFO Don A. Baines, Assistant Clerk
ALTEC INTERNATIONAL LIMITED NATIONAL CITY BANK
PARTNERSHIP
By: CHART MANAGEMENT COMPANY, By: /s/ Anthony J. DiMare
INC., its sole general partner -------------------------------------
Anthony J. DiMare, Senior Vice President
By: /s/ Don A. Baines
-----------------------------------
Don A. Baines, Secretary and Treasurer
ALTEC, INC. NBD BANK
By: /s/ Don A. Baines By: /s/ Paul R. DeMelo
----------------------------------- -------------------------------------
Don A. Baines, Assistant Secretary Paul R. DeMelo, Vice President
GREENVILLE TUBE CORPORATION NATIONAL CITY BANK, as Agent
By: /s/ Don A. Baines By: /s/ Anthony J. DiMare
----------------------------------- -------------------------------------
Don A. Baines, Assistant Secretary Anthony J. DiMare, Senior Vice President
CHART MANAGEMENT COMPANY, INC. CRYENCO SCIENCES, INC.
By: /s/ Don A. Baines By: /s/ Don A. Baines
----------------------------------- -------------------------------------
Don A. Baines, Secretary and Treasurer Don A. Baines, Secretary and Treasurer
</TABLE>
13
<PAGE> 14
<TABLE>
<CAPTION>
CHART INDUSTRIES FOREIGN SALES
CORPORATION CRYENCO, INC.
<S> <C>
By: /s/ Don A. Baines By: /s/ Don A. Baines
----------------------------------- ---------------------------------------
Don A. Baines, Secretary and Treasurer Don A. Baines, Secretary, Treasurer and
Chief Financial Officer
</TABLE>
The undersigned hereby acknowledges and agrees that as of the date hereof it is
a member of the Borrowing Group, subject to all the terms and conditions of the
Credit Agreement, as amended.
CHART INTERNATIONAL, INC.
By: /s/ Don A. Baines
---------------------------------
Don A. Baines, Treasurer and
Chief Financial Officer
14
<PAGE> 15
The undersigned hereby execute this Second Amendment to Credit Agreement in
order to acknowledge that each of them is a "Company" and a "Subsidiary" and
therefore bound by the terms and conditions of the Credit Agreement, as amended
hereby, applicable to Companies and Subsidiaries, including, without limitation,
the negative convenants contained in Article VII of the Credit Agreement,
subject to exception as provided herein. Notwithstanding the foregoing neither
of the undersigned is a member of the Borrowing Group nor liable for any payment
obligations under the Credit Agreement, as amended hereby.
CHART UK INVESTMENTS LIMITED PARTNERSHIP
By Chart Management, Inc.
By: /s/ Don A. Baines
-------------------------------------------
Don A. Baines, Secretary and Treasurer
CHART MARSTON LTD.
By: /s/ Don A. Baines
-------------------------------------------
Don A. Baines, Directory
15
<PAGE> 16
SCHEDULE 4.01
-------------
COMPANY GOOD STANDING
- ------- -------------
LOCATION(S)
------------
- --------------------------------------------------------------------------------
Chart Industries, Inc. Delaware*
Ohio
- --------------------------------------------------------------------------------
ALTEC International Limited Partnership Delaware*
Wisconsin
- --------------------------------------------------------------------------------
ALTEC, Inc. Wisconsin*
- --------------------------------------------------------------------------------
Chart Management Company, Inc. Ohio*
- --------------------------------------------------------------------------------
Chart Industries Foreign Sales Corporation U.S. Virgin Islands*
- --------------------------------------------------------------------------------
Process Systems International, Inc. Massachusetts*
New Hampshire
California
Ohio
Louisiana
Washington
- --------------------------------------------------------------------------------
Greenville Tube Corporation Arkansas*
Pennsylvania
- --------------------------------------------------------------------------------
CHD, Inc. Delaware*
- --------------------------------------------------------------------------------
Chart Acquisition Company Delaware*
- --------------------------------------------------------------------------------
Cryenco Sciences, Inc.* Delaware*
Colorado**
- --------------------------------------------------------------------------------
Cryenco, Inc.* Colorado*
- --------------------------------------------------------------------------------
Cryenex, Inc. Delaware*
- --------------------------------------------------------------------------------
Chart International Inc. Delaware*
- --------------------------------------------------------------------------------
Chart Marston Limited United Kingdom*
- --------------------------------------------------------------------------------
Chart UK Investments Limited Partnership United Kingdom*
- --------------------------------------------------------------------------------
*State of Organization
<PAGE> 17
PART I
------
Capital Structure
-----------------
Owners of Chart Industries, Inc. common stock include:
Arthur S. Holmes 2,656,737 shares directly 18.4%
2,654,340 shares indirectly 18.4%
Charles S. Holmes 1,497,157 shares directly 10.3%
26,000 shares indirectly 0.2%
Gintel Equity Management 1,356,750 shares 9.4%
beneficially
Chart Industries, Inc. owns:
30,000 shares AlTEC, Inc. (100%)
100 shares Chart industries Foreign Sales Corporation (100%)
750 shares Chart Management Company, Inc. (100%)
6,840 shares Greenville Tube Corporation (100%)
200 shares Process Systems International, Inc. (100%)
shares of Chart International Inc. (100%)
<PAGE> 18
Part I cont'd
ALTEC, Inc. owns:
1,500 shares CHD, Inc. (100%)
Greenville Tube Corporation owns:
1000 shares of Chart Acquisition Company (100%)
In addition, the ALTEC International Limited Partnership is owned:
95% by CHD, Inc. and
5% by Chart Management Company, Inc.
The Chart International Limited Partnership is owned:
96% by CHD, Inc. and
2% by Chart Management Company, Inc.
Chart International Inc. owns:
2 shares of Chart Marston Limited (100%)
PART II
-------
Indebtedness for Borrowed Money
-------------------------------
Process Engineering Division of Process systems International, Inc. - $80,000.00
Note payable to BancBoston Ventures, 100 Federal St., Boston, MA 02110,
principal payments of $4,000.00 plus accrued interest at 10% per annum payable
on the first day of each January, April, July and October until July 1, 1997.
The current principal balance is $4,000.00.
ALTEC International Limited Partnership and Chart Industries, Inc. -
$5,000,000.00 Industrial Development Revenue Bonds dated July 1, 1996 to GE
Capital Public Finance, Inc. as Lender and to the City of LaCrosse, Wisconsin as
issuer. The bonds are collateralized in the next five years as follows: 1997 -
$361,000; 1998 - $405,000; 1999 - $431,000; 2000 - $459,000 and 2001 - $489,000.
The Company is required to spend these monies on the current expansion and has
commitments with vendors covering this work. All funds should be released from
escrow by the end of 1997. The current balance is $4,634,000.00.
USL Capital, Lessor
Cryenco Sciences, Inc., Lessee
<PAGE> 19
Items Leased: Forklift, Overhead Crane, Paint Booths, Compressor
Outstanding Balance as of July 31, 1997: $148,107.35
Monthly Payment: $8,266.29
Lease Expires: May, 1999
USL Capital, Lessor
Cryenco Sciences, Inc., Lessee
Items Leased: Telephone System, Computer system, Copy Machine
Outstanding Balance as of July 31, 1997: $213,990.96
Monthly Payment: $6,692.16
Lease Expires: November, 2000
<PAGE> 20
SCHEDULE 7.05
-------------
Existing Investments
--------------------
Besides the investments set forth on Schedule 4.01, the Companies have the
following investments:
Process Systems International, Inc. has a $2,000.00 investment
in founders stock of Paramag, a corporation which has been
developing processes which would use Process Systems
International, Inc. equipment.
Chart Industries, Inc. periodically makes overnight
investments of idle cash through National City Bank.
Chart Industries, Inc. has (in connection with the Chart
Marston Limited acquisition of IMI Kynoch Ltd.), invested
approximately 17.5 million dollars in Chart UK Investment
Limited Partnership through its partners Chart Management
Company, Inc. and CHD, Inc. Chart UK Investment Limited
Partnership lends 17.5 million dollars to Chart Marston
Limited on a 364 day basis.
Chart Industries, Inc. has (in connection with the Chart
Marston Limited acquisition of IMI Kynoch Ltd.), invested
approximately 4 million pounds sterling in Chart International
Inc. which lends that sum to Chart Marston Limited on a 364
day basis.
+Cryenco, Inc., a wholly-owned subsidiary of Cryenco Sciences,
Inc., owns 50% of Cryomex S.A. de C.V.
+ Upon consummation of the Cryenco Sciences, Inc. acquisition
<PAGE> 1
Exhibit 10.2
------------
PERMITTED USER AGREEMENT - TRADE MARK MARSTON
---------------------------------------------
THIS AGREEMENT is made the 27th day of March One Thousand nine hundred and
ninety-eight between IMI Marston Limited (registered in England No 155987) whose
registered office is at Wobaston Road, Fordhouses, Wolverhampton WV10 6QJ,
United Kingdom (hereinafter called "IMI") of the one part and Chart Marston
Limited (registered in England No 3497115) whose registered office is at 55
Colmore Row, Birmingham B3 2AS (hereinafter called the "User") of the other part
WHEREAS
- -------
A. IMI is the proprietor of the trade mark MARSTON details of which are set
out in Schedule 1 in respect of heat exchangers (hereinafter called "the
Trade Mark").
B. The User desires to be permitted to use the Trade Mark in respect of the
goods described in Parts 1 and 2 of Schedule 4 (hereinafter called "the
Goods").
NOW IT IS HEREBY AGREED AS FOLLOWS:
- ----------------------------------
1 IMI hereby grants to the User:
(i) an exclusive royalty-free licence to use the Trade Mark in, upon
or in connection with the manufacture, marketing, promotion,
sale, repair, design, testing and provision of after-sales
services of the Part 1 Goods (as defined in Schedule 4); and
(ii) an exclusive royalty free licence to use the name "Chart
Marston" or "Chart Marston Limited" as a corporate, business or
trading name and to use the
<PAGE> 2
Trade Mark in conjunction with any other corporate, business or
trading name subject to the prior written approval of IMI which
shall not be unreasonably withheld or delayed; and
(iii) a non-exclusive royalty free licence to use the Trade Mark in,
upon or in connection with the manufacture, marketing,
promotion, sale, repair, design, testing and provision of after
sales services of the Part 2 Goods (as defined in Schedule 4).
within the countries listed in Schedule 2 to this Agreement ("the
Territory") providing the User observes the following conditions or
restrictions:
a) The User shall use the Trade Mark only upon or in connection
with the Goods which are manufactured by or on behalf of the
User in accordance with standards, specifications and
instructions reasonably laid down by IMI and notified in writing
to the User from time to time and to the quality standards
required by BS9001 or ASME "U" stamp approval as updated from
time to time or an equivalent national or international
standard. For the sake of clarity, standards other than relating
to quality shall be no more onerous than the standards in use
during 1997 by IMI for the Goods.
b) The User, on being given reasonable written notice, shall permit
IMI and/or its authorised representative to inspect the premises
of the User, the Goods offered for sale under the Trade Mark in
accordance with this Agreement and the method by which they are
manufactured, and shall do all such things as may be reasonably
necessary to ensure that the Goods conform to the standards
specified above.
2
<PAGE> 3
c) The User undertakes not to use the Trade Mark accompanied by any
other trade marks in relation to the Goods unless the Trade Mark
is sufficiently distinguished from the surrounding and adjacent
text and/or trade mark(s) and IMI or any subsequent proprietor
is identified as the proprietor of the Trade Mark, nor to take
any actions which would compromise the continuing validity of
any rights of IMI in the Trade Marks. The User shall further
comply with all reasonable written directions given by IMI
regarding the use of the Trade Mark on the Goods and/or on all
notepaper, invoices, transfers, labels, packages, package
inserts, advertising matter and other media of all kinds issued
or employed by the User upon or in connection with the Goods
(the "Materials"). The User shall also submit to IMI, for
approval, the original format and all subsequent new formats of
such of the Materials which incorporate the Trade Mark and shall
not issue the same without the prior approval of IMI, which
shall not unreasonably be withheld or delayed. IMI shall be
deemed to have given its approval of any of the Materials if it
does not give to the User written notice to the contrary within
10 days after receipt of the original format or subsequent new
format, as appropriate, of the Materials.
d) The User may sub-contract the manufacture, marketing, promotion,
sale, repair, design, testing and provision of after-sales
services of the Goods to any third party and shall be entitled
to sub-license such third party to use the Trade Mark for such
purposes provided that the User shall remain liable for all of
its obligations and responsibilities under this Agreement.
3
<PAGE> 4
2 The User shall be the sole permitted user of the Trade Mark for the Part
1 Goods during the life of this Agreement. The parties shall immediately
upon the execution of this Agreement execute a formal licence of the
Trade Mark in the form set out in Schedule 3 to this Agreement to be
registered with the United Kingdom Trade Marks Registry or such formal
licence in substantially similar terms to be registered with the
relevant competent authority in the country of registration of the Trade
Mark within the Territory. The costs of registration shall be borne by
both parties equally. In the event of any inconsistency between the
provisions of this Agreement and any formal licence executed pursuant to
this Clause 2, the provisions of this Agreement shall prevail.
3 No right, title or interest in the Trade Mark, except as set out in this
Agreement, is transferred by this Agreement to the User, and the Trade
Mark remains the sole property of IMI and any and all use thereof
including use by the User shall inure to the benefit of IMI.
4 As and when requested by and at the expense of IMI, the User hereby
undertakes to use all reasonable efforts to provide any documentation
which is required by IMI to apply for or renew a registration of the
Trade Mark. Where IMI applies for and subsequently obtains further
registrations of the Trade Mark in respect of the Goods then such new
registrations shall be included in Part 1 of Schedule 1 and shall be
deemed to be licensed by IMI to the User as part of the Trade Mark
pursuant to this Agreement. The User also undertakes not to obstruct or
to try to prevent the registration of the Trade Mark by IMI and not to
assist third parties, whether directly or indirectly, in any action
against registration or renewal of the Trade Mark.
4
<PAGE> 5
5 The User shall forthwith notify IMI of any suspected unauthorised use of
the Trade Mark which may come to its notice. The User may request IMI to
commence or defend any proceedings in respect of any unauthorised use or
suspect unauthorised use of the Trade Mark but if IMI decides not to
commence or defend any such proceedings within a period of two months
from the date of such request the User shall have the right to commence
or defend any such proceedings in its own name, subject to IMI's prior
written approval which shall not be reasonably withheld or delayed.
Where such written approval is given by IMI, it shall give the User such
assistance as may be reasonably required by the User including agreeing
to be joined in as a party to the issue or defence of any proceedings,
subject to payment by the User of all reasonable costs and expenses
incurred by IMI in providing such assistance. The User shall be entitled
to retain for its own absolute benefit any damages, costs or other
expenses awarded or recovered in any such proceedings.
6 The User shall not sell or transfer control of any company using the
name MARSTON as part of the name of such company without first changing
the name of the company to exclude the name MARSTON.
7 IMI shall promptly pay all renewal and maintenance fees for the
registration of the Trade Mark for the Goods during the term of this
Agreement. With effect from 1 January 1999, the User shall reimburse IMI
for sixty per cent of the total direct costs (including attorneys costs
and internal administration costs) reasonably incurred by IMI in
registering, establishing use of, renewing and defending the Trade Mark
(subject to an overall maximum contribution by the User of (pound)25,000
per calendar year) (the "Contribution") in the Territory.
5
<PAGE> 6
IMI shall provide the User with a calendar quarterly statement in
arrears setting out full details of all direct costs paid by IMI
together with copies of payment receipts accompanied by an invoice for
part of the Contribution. Such invoices shall be payable by the User
within 30 days of receipt.
In the event that, for whatever reason, the total direct costs incurred
by IMI in registering, establishing use of, renewing and defending the
Trade Mark in the Territory in any calendar year, exceed the
Contributions from the User, and if IMI wishes to cease to maintain or
defend any registration of the Trade Mark for the Goods, it shall notify
the User to that effect. The User may within 30 days of the date of
receipt of such notification from IMI call for an assignment of the
Trade Mark and in that event IMI shall at the User's costs, do all such
things and take all such actions as may be necessary to assign the Trade
Mark to the User. In the event that the User takes such an assignment it
shall further reimburse IMI for any reasonable costs incurred in
defending or maintaining an assigned registration between the date of
notification to the User and the date of assignment.
8 In the event that the User shall be in breach of this Agreement and
fails or be unable to remedy the same within sixty days of its attention
being called thereto in writing specifying the breach and requiring it
to be remedied, or the User shall go into liquidation whether
voluntarily or compulsorily (otherwise than for the purpose of
amalgamation or reconstruction), or ceases to be owned beneficially by
Chart Industries Inc, IMI shall have the right by notice in writing to
terminate this Agreement forthwith in its entirety without prejudice,
however, to any rights either party may have against the other arising
prior to termination.
6
<PAGE> 7
9 Subject to Clause 8 hereof this Agreement shall commence on the date
hereof and shall remain in force for five years from the date of this
Agreement. It may be renewed by the User for further periods of five
years each, by the User giving notice in writing to IMI or any
subsequent beneficial owner of the Trade Mark within the last twelve
months of the then current term of the Agreement.
10.1 The User may at any time assign all or any of its rights and obligations
under this Agreement to any company which is for the time being a
subsidiary or holding company of the User or a subsidiary of any such
holding company (and the terms "subsidiary" and "holding company" shall
have the meaning given to them by Sections 736 and 736A of the Companies
Act 1985 ("Users Group") without the prior written consent of IMI or to
any third party subject to the prior written consent of IMI which shall
not be unreasonably withheld or delayed provided that in each case it is
only assigned with the whole of the business of the User and provided in
the case of any assignment to a member of the User's Group it notifies
IMI in writing to that effect at least 7 days prior to such assignment.
IMI may not assign the whole or any part of the benefit or burden of
this Agreement without the prior written consent of the User which shall
not be unreasonably withheld or delayed except that IMI shall be free to
assign the benefit of this Agreement to any third party which acquires
the legal and beneficial ownership of the Trade Mark, provided it
notifies the User in writing to that effect at least 7 days prior to
such transfer of ownership.
10.2 The User shall indemnify IMI in respect of any liability of IMI for
taxation consequent upon the assignment of all or any of the User's
rights and obligations under this Agreement.
7
<PAGE> 8
10.3 If any sum payable under Clause 10.2 of this Agreement by the User to
IMI is subject to tax in the hands of IMI, the User shall pay to IMI
such additional amount (after taking into account any taxation payable
in respect of such additional amount) as will ensure that IMI receives
and retains a nett amount equal to the full amount which it would have
received and retained had the payment not been subject to tax.
11 Upon the termination of this Agreement in accordance with Clause 8, the
User shall not later than 60 days from the date of termination remove or
obliterate the Trade Mark from all and any Materials used in connection
with the Goods in the possession, custody or control of the User and the
User shall after expiry of such 60 day period cease to make any use of
the Trade Mark or any colourable imitation thereof.
12.1 Any notice, request or other communication to be given by either party
to the other party under this Agreement shall be in writing and may be
served by personal delivery or by registered or recorded first class
post or facsimile to the addresses and numbers set out above (or such
other address(es) or number(s) as either party may have specified by
giving at least seven (7) days prior written notice to the other).
12.2 The effective date of any notice given in accordance with Clause 12.1
shall be, in the case of personal delivery upon delivery or in the case
of facsimile, the next day after it was transmitted and, in the case of
post three (3) days after it was sent.
12.3 To prove service of any notice it shall be sufficient to show in the
case of a notice delivered by hand that the same was duly addressed and
delivered by hand and in the case of a notice served by post that the
same was duly addressed prepaid and posted in the manner set out in
Clause 12.1. In the case of a notice given by facsimile it shall be
sufficient to produce a transmission report generated by the relevant
facsimile
8
<PAGE> 9
machine to show that the notice was successfully transmitted.
13 This Agreement shall be governed by and construed in accordance with
English law and the parties hereto agree to submit to the exclusive
jurisdiction of the English courts any claim or dispute arising
hereunder provided that any dispute as to the validity, scope or
infringement of the Trade Mark shall be determined by the courts or any
competent authority in the country of registration of the relevant Trade
Mark
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be
executed by their duly authorised representatives as follows the day and
year first above written.
9
<PAGE> 10
SCHEDULE 1
----------
THE TRADE MARK
PART 1 REGISTERED MARK
<TABLE>
<CAPTION>
TERRITORY TRADE MARK REGISTRATION NO
--------- ---------- ---------------
<S> <C> <C>
Benelux Marston 56535
Canada Marston 450515
Denmark Marston 1565-1976
France Marston 1528837
Ireland Marston 81772
Italy Marston 255969
Japan Marston 1025273
Japan Marston 2036677
United States Marston 1885699
UK Marston 997450
UK Marston 997451
UK Marston 1040203
UK Marston 1040204
UK Marson 1040205
UK Marston 1216767
UK Marston 1216768
UK Marston 1286002
UK Marston 1359330
UK Marston Compact 1499186
Exchangers
United States Marston 74/373739
United States Marston 72632500
</TABLE>
10
<PAGE> 11
PART 2 UNREGISTERED MARK
MARSTON NAME, MARK AND LOGO
SCHEDULE 2
----------
THE TERRITORY
1 In relation to the Trade Mark set out in Part 1 of Schedule 1: The
United Kingdom, Benelux, Canada, Denmark, France, Ireland, Italy, Japan
and the United States of America.
2 In relation to the Trade Mark set out in Part 2 of Schedule 1: All other
countries in the world other than those listed in 1 above.
SCHEDULE 3
----------
(THE FORM OF LICENCE FOR REGISTRATION)
THIS AGREEMENT is made on ___________________ 19[__] BETWEEN: IMI
Marston Limited (registered in England No 155987) whose registered
office is at Wobaston Road, Fordhouses, Wolverhampton WV10 6QJ, United
Kingdom (hereinafter called "IMI") of the one part and Chart Marston
Limited (registered in England No 3497115) whose registered office is at
55 Colmore Row, Birmingham B3 2AS (hereinafter called the "User.")
WHEREAS:
(A) IMI is the registered proprietor of the trade marks set out in
the Schedule to this Agreement (the "TRADE MARKS")
(B) The parties have entered into an agreement for the grant of a
licence to the User by IMI under the Trade Marks.
11
<PAGE> 12
NOW THIS DEED WITNESSETH:
1 IMI grants to the User, inter alia, an exclusive royalty-free
licence subject to and upon the terms and conditions of an
agreement dated 27th March 1998 between IMI (1) and the User (2)
under the Trade Marks ("MAIN AGREEMENT")
2 IMI will join with the User in making application to the
Registrar of Trade Marks for the purpose of securing the
registration of the User as a licensee of the Trade Marks under
the provisions of Section 25 of the Trade Marks Act 1994
3 This Agreement shall terminate automatically on the termination
of the Main Agreement.
IN WITNESS OF THE ABOVE the parties have executed this Agreement as a
Deed on the date written at the head of this Agreement
12
<PAGE> 13
THE SCHEDULE
------------
[DUPLICATE PART 1 OF SCHEDULE 1 TO THE MAIN AGREEMENT]
EXECUTED as a Deed by )
IMI MARSTON LIMITED )
acting by: ) Director
Director/Secretary
EXECUTED as a Deed by )
CHART MARSTON LIMITED ) Director
acting by: )
Director/Secretary
13
<PAGE> 14
SCHEDULE 4
----------
THE GOODS
PART 1
Industrial heat exchangers manufactured using technology and/or
know-how acquired from IMI and all or any developments, modifications
and improvements arising therefrom (excluding those for use in aerial
or terrestrial transport or electronic applications) ("Part 1 Goods").
PART 2
Industrial heat exchangers for use in Railway Engines and Railway Stock
manufactured using technology and/or know-how acquired from IMI and all
or any developments, modifications and improvements arising therefrom
("Part 2 Goods").
14
<PAGE> 15
For and on behalf of
IMI Marston Limited
/s/ Trevor Davies
-----------------
Director
For and on behalf of
Chart Marston Limited
/s/ Arthur S. Holmes
--------------------
Director
15
