<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT: AUGUST 9, 1996
(DATE OF EARLIEST EVENT REPORTED)
GARDNER DENVER MACHINERY INC.
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 0-23612 76-0419383
(State or Other Jurisdiction of (Commission File (I.R.S. Employer
Incorporation or Organization) Number) Identification No.)
1800 GARDNER EXPRESSWAY
QUINCY, ILLINOIS 62301
(Address of Principal Executive Offices and Zip Code)
(217) 222-5400
(Registrant's Telephone Number, Including Area Code)
<PAGE> 2
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
- ---------------------------------------------
On August 9, 1996, pursuant to a Stock Purchase Agreement dated July 11, 1996
among Gardner Denver Machinery Inc. ("Gardner Denver"), Noramptco, Inc. a
Delaware corporation ("Noramptco"), Jacques Lepage, Suzanne Lepage, Anne
Lepage and Arthur Lepage, Gardner Denver acquired (i) from Jacques Lepage,
all of the issued and outstanding shares of capital stock of Noramptco, all
of the issued and outstanding shares of capital stock of Lamcor, Ltd., a
United Kingdom corporation, and all of the issued and outstanding shares of
capital stock of Lamson Corporation, a New York corporation and a subsidiary
of Noramptco, not owned by Noramptco; and (ii) from Jacques Lepage, Suzanne
Lepage, Anne Lepage and Arthur Lepage, all of the issued and outstanding
capital stock of Lamson Europe S.A., a French corporation, not owned by
Noramptco, Lamson Corporation or U.S. Turbine Corporation, a Delaware
corporation and a wholly-owned subsidiary of Noramptco. The aggregate
purchase price was approximately $30.5 million in cash, subject to adjustment
based upon a closing balance sheet, and was negotiated between Gardner Denver
and Jacques Lepage as the fair market value for the capital stock acquired.
Funding for this acquisition was provided under Gardner Denver's existing $65
million credit facility, entered into on November 30, 1995, as to which The
First National Bank of Chicago acts as agent for itself and the other lenders
participating in the credit facility.
The assets indirectly acquired by the acquisition of capital stock are those
assets previously used by Noramptco and its subsidiaries in the manufacture
and distribution of cast iron centrifugal blower and exhauster component
systems and fabricated steel multi-stage centrifugal blowers and exhausters.
Gardner Denver currently intends to continue to use such assets for the
purposes used by Noramptco and its subsidiaries prior to the subject
transaction.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
- ------------------------------------------
(a) Financial statements of businesses acquired
(b) Pro forma financial information
---------
Audited financial statements of Noramptco for the fiscal year ended
January 31, 1996, in accordance with Rule 3.05 of Regulation S-X,
and pro forma financial information prepared pursuant to Article 11
---------
of Regulation S-X, are not currently available. The required
financial statements and pro forma financial information will be
---------
filed as an amendment to this Form 8-K as soon as practicable but
not later than 60 days after this Form 8-K must be filed.
(c) Exhibits
2.0 Stock Purchase Agreement dated July 11, 1996, among Gardner Denver,
Noramptco, Jacques Lepage, Suzanne Lepage, Anne Lepage and Arthur
Lepage. (All schedules and exhibits described in the Stock
Purchase Agreement have been omitted and Gardner Denver will
furnish supplementally to the Commission, upon request, a copy of
any omitted schedule or exhibit.)
<PAGE> 3
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 thereunto duly authorized.
GARDNER DENVER MACHINERY INC.
Date: August 23, 1996 By: /s/Philip R. Roth
-------------------------------------
Philip R. Roth
Vice President, Finance and
Chief Financial Officer
<PAGE> 4
GARDNER DENVER MACHINERY INC.
<TABLE>
EXHIBIT INDEX
<CAPTION>
EXHIBIT
NO. DESCRIPTION
<C> <S>
2.0 Stock Purchase Agreement dated July 11, 1996, among Gardner Denver,
Noramptco, Jacques Lepage, Suzanne Lepage, Anne Lepage and Arthur
Lepage.
</TABLE>
<PAGE> 1
Exhibit 2.0
STOCK PURCHASE AGREEMENT
------------------------
THIS STOCK PURCHASE AGREEMENT (the "Agreement") is made this 11th day
of July, 1996, among JACQUES LEPAGE, the sole stockholder of NORAMPTCO, INC.,
a Delaware corporation ("Noramptco") (the "Stockholder"), GARDNER DENVER
MACHINERY INC., a Delaware corporation ("Gardner Denver"), Noramptco and the
other stockholders of Lamson Europe S.A. identified on the signature pages of
this Agreement.
RECITALS:
WHEREAS, the Stockholder is the owner of all of the issued and
outstanding shares of capital stock of Noramptco and of Lamcor, Ltd., a U.K.
corporation ("Lamcor"), and the Stockholder, Noramptco and related entities
and persons own all of the issued and outstanding capital stock of the
Noramptco Subsidiaries (as hereinafter defined); and
WHEREAS, the Stockholder and such related persons desire to sell the
shares of capital stock of Noramptco, Lamcor and the Noramptco Subsidiaries
owned by them, and Gardner Denver desires to purchase such shares on the
terms and conditions of this Agreement, such that Gardner Denver will own,
directly or indirectly, all of the issued and outstanding shares of capital
stock of Noramptco, Lamcor and the Noramptco Subsidiaries.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants hereinafter set forth, the parties hereto agree as follows:
1. SALE AND PURCHASE OF CAPITAL STOCK. Subject to the terms and
----------------------------------
conditions herein contained, the Stockholder and the other persons identified
below agree to sell and Gardner Denver agrees to purchase the issued and
outstanding shares of capital stock of Noramptco, Lamcor and the Noramptco
Subsidiaries set forth opposite the name of each respective selling
stockholder, as follows:
<PAGE> 2
<TABLE>
<CAPTION>
Number of Shares
Entity Selling Stockholder of Common Stock
- ------ ------------------- ----------------
<S> <C> <C>
Noramptco Jacques Lepage 900
Lamson Corporation Jacques Lepage 7,500
Lamson Europe S.A. Jacques Lepage 60
Suzanne Lepage 7
Anne Lepage 1
Arthur Lepage 1
Lamcor Jacques Lepage 1,000
</TABLE>
2. PURCHASE PRICE.
--------------
(a) Aggregate Purchase Price. The aggregate purchase price for the
------------------------
capital stock of Noramptco, Lamcor and the Noramptco Subsidiaries sold and
purchased pursuant to Section 1 above shall be Twenty-Eight Million Five
Hundred Forty Thousand Dollars ($28,540,000) less the aggregate amount of
fees and expenses paid and payable by Noramptco to Tucker Anthony
Incorporated relating to the transactions contemplated by this Agreement,
allocated as follows: (i) for the 900 shares of Noramptco, $26,038,431 less
the aggregate amount of fees and expenses paid and payable by Noramptco to
Tucker Anthony Incorporated relating to the transactions contemplated by this
Agreement, which amount shall be subject to any purchase price adjustment
determined as set forth in Section 2(b) below and to the escrow arrangement
as described in Section 3 below; (ii) $2,500,000 for the 7,500 shares of
Lamson Corporation ("Lamson"); (iii) $69 for the 69 shares of Lamson Europe
S.A., such amount to be further allocated pro rata on a per share basis
among the stockholders of Lamson Europe S.A. identified in Section 1 above;
and (iv) $1,500 for the 1,000 shares of Lamcor.
(b) Purchase Price Adjustment.
-------------------------
-2-
<PAGE> 3
(i) On or as promptly as practicable following the Closing Date,
but in no event later than 45 days thereafter, the Stockholder shall cause to
be prepared and delivered to Gardner Denver an unaudited consolidated balance
sheet of Noramptco and the Noramptco Subsidiaries as of the later of August
4, 1996 or the last day of the fiscal month preceding the month of the
Closing Date (the "Closing Balance Sheet"), together with a certificate
setting forth the consolidated net worth of Noramptco and the Noramptco
Subsidiaries as reflected on the Closing Balance Sheet (the "Closing Net
Worth") and the computation and components thereof in reasonable detail (the
"Statement of Closing Net Worth"). The Closing Balance Sheet shall be
prepared in accordance with generally accepted accounting principles and in a
manner consistent with the preparation of the consolidated balance sheet as
of January 31, 1996, except that the Closing Balance Sheet (i) shall reflect
accruals for all good faith estimated unpaid expenses of Noramptco relating
to the transactions contemplated by this Agreement, including fees for legal,
accounting and other professional services (other than the fees and expenses
of Tucker Anthony Incorporated payable by Noramptco relating to the
transactions contemplated by this Agreement) rendered prior to the Closing
Date and good faith estimates of fees for such services to be rendered after
the Closing Date, (ii) shall not take into account indebtedness owed to Key
Bank in the principal amount of $1,960,000 or the corresponding reduction in
retained earnings in the amount of $1,960,000, both arising in connection
with the repurchase of shares of Noramptco common stock by Noramptco, (iii)
shall be prepared before taking into account the minority interest in Lamson
owned by the Stockholder and (iv) shall not take into account any fees and
expenses of Tucker Anthony Incorporated payable by Noramptco relating to the
transactions contemplated by this Agreement. Gardner Denver shall afford the
Stockholder and his
-3-
<PAGE> 4
representatives, during normal business hours, upon reasonable notice, without
undue interruption, and without charge, full access to the books and records of
Noramptco and the Noramptco Subsidiaries and to the employees of Gardner Denver
(including the former employees of Noramptco and its subsidiaries, it being
agreed by Gardner Denver that the Stockholder shall be afforded the services of
John Clarke and of the accounting staff of Lamson for purposes of assisting the
Stockholder in the preparation of the Closing Balance Sheet and the Statement
of Closing Net Worth) in connection with the preparation of the Closing Balance
Sheet and the Statement of Closing Net Worth and all related activities under
this Section 2(b). As part of the preparation of the Closing Balance Sheet,
the Stockholder shall cause a physical count to be taken of the inventory of
Lamson and U.S. Turbine Corporation, which if reasonably proximate in time to
the Closing Date, may be taken after execution of this Agreement but prior to
the Closing Date. Representatives of Gardner Denver shall be permitted to
observe such physical inventory count.
(ii) Unless the Closing Net Worth shown on the Statement of
Closing Net Worth is disputed by Gardner Denver pursuant to subsection (iii)
below, on the forty-fifth day after delivery of the Closing Balance Sheet and
the Statement of Closing Net Worth to Gardner Denver (or such earlier date as
Gardner Denver may notify the Stockholder in writing), (x) in the event the
Closing Net Worth exceeds $10,383,940, which was the actual net worth as of
January 31, 1996 of Noramptco and the Noramptco Subsidiaries calculated
before taking into account the minority interest in Lamson owned by the
Stockholder (the "Base Net Worth"), by more than $200,000, then Gardner
Denver shall pay to the Stockholder, by bank wire transfer of immediately
available funds, an amount equal to such excess as an adjustment to the
-4-
<PAGE> 5
consideration received by the Stockholder upon the sale of the capital stock
of Noramptco owned by him, and (y) in the event the Base Net Worth exceeds
the Closing Net Worth by more than $200,000, then the Stockholder shall pay
to Gardner Denver by bank wire transfer of immediately available funds an
amount equal to such excess as an adjustment to the consideration received by
the Stockholder upon the sale of the capital stock of Noramptco owned by him.
In the event the Closing Net Worth exceeds the Base Net Worth by $200,000 or
less or the Base Net Worth exceeds the Closing Net Worth by $200,000 or less,
then no adjustment shall be made to the purchase price pursuant to this
Section 2(b). It is understood and agreed that if Gardner Denver does not
dispute the Closing Net Worth shown on the Statement of Closing Net Worth
pursuant to subsection (iii) below, then the Closing Net Worth shown on the
Statement of Closing Net Worth shall be deemed accepted in all respects by
Gardner Denver and shall be final and binding upon the parties hereto.
(iii) If Gardner Denver desires to dispute the Closing Net Worth
shown on the Statement of Closing Net Worth, Gardner Denver shall give
written notice (the "Dispute Notice") to the Stockholder not more than 45
days after receipt of the Closing Balance Sheet and the Statement of Closing
Net Worth, which Dispute Notice shall specify in reasonable detail the
reasons for such disagreement and the amount in dispute. If the Stockholder
and Gardner Denver are unable to resolve such disputed matters within 30 days
after receipt by the Stockholder of the Dispute Notice, such disputed matters
shall be submitted for resolution to the Cleveland, Ohio office of such
nationally recognized independent accounting firm as is chosen by mutual
agreement of the Stockholder and Gardner Denver acting in good faith (the
"Independent Auditor"). Each party may submit to the Independent Auditor a
written statement
-5-
<PAGE> 6
in support of its position with respect to the disputed matters raised in the
Dispute Notice and not resolved, which are the only matters to be considered by
the Independent Auditor. The Independent Auditor's resolution of any such
dispute shall be reflected in a written report delivered to the Stockholder and
Gardner Denver as promptly as practicable, which report shall, in addition to
setting forth the resolution of the disputed matters, set forth the Closing Net
Worth determined in accordance with the terms hereof. The determination of the
Independent Auditor as set forth in such report shall be final and binding upon
the parties hereto. One-half of all fees and disbursements of the Independent
Auditor shall be paid by the Stockholder and one-half of such fees and
disbursements shall be paid by Gardner Denver. Any payment required to be
made as a consequence of the determination of the Independent Auditor shall
be made by bank wire transfer of immediately available funds not later than
three business days after the receipt of the Independent Auditor's report by
the Stockholder and Gardner Denver.
3. CLOSING. The closing (the "Closing") of the transactions
-------
contemplated by this Agreement shall take place at the offices of Squire,
Sanders & Dempsey, in Cleveland, Ohio, at 10:00 a.m. on the fifth business
day following satisfaction of the conditions to Closing set forth in Sections
8(b) and 9(b) hereof, or such other time, date or place as Gardner Denver and
the Stockholder mutually agree (the "Closing Date"). At the Closing, each
selling stockholder identified in Section 1 of this Agreement shall deliver
or cause to be delivered to Gardner Denver one or more certificates
representing that respective number of shares of capital stock as set forth
in such Section 1, duly endorsed for transfer or with appropriate stock
transfer powers in blank attached. In exchange for such delivery, Gardner
Denver shall pay to such stockholders the applicable purchase prices set
forth in or calculated in accordance with Section
-6-
<PAGE> 7
2(a) hereof, in immediately available funds by wire transfer to accounts
designated by the selling stockholders, except as set forth below in this
Section 3 and except that $750,000 of the purchase price allocated to the
Stockholder for the sale of his shares of Noramptco shall be delivered to The
First National Bank of Chicago (the "Escrow Agent") under an Escrow Agreement
in the form attached hereto as Exhibit A and such funds shall be held and
distributed according to the terms of the Escrow Agreement. In addition, the
Stockholder shall execute and deliver and Gardner Denver shall cause Lamcor to
execute and deliver at the Closing an Employment Agreement in the form of
Exhibit B attached hereto. At the Closing, the Stockholder shall repay, by
netting against the purchase price payable to him hereunder, his personal
obligations owing to Noramptco and/or Lamson, as such obligations are reflected
by the outstanding balances at the Closing Date (including accrued but unpaid
interest to such Closing Date) of the promissory notes, dated February 28,
1994, of the Stockholder in favor of Lamson, together with any balance
remaining with respect to advances previously made to the Stockholder and
owing to Noramptco, any of the Noramptco Subsidiaries, or Lamcor, after
applying against such advances any bonus credited to the Stockholder as
permitted by Section 7(b) of this Agreement.
4. REPRESENTATIONS AND WARRANTIES OF NORAMPTCO AND STOCKHOLDER.
-----------------------------------------------------------
Noramptco and the Stockholder represent and warrant to Gardner Denver as of the
date hereof as follows:
(a) Organization, Authority and Qualification. Noramptco is a
-----------------------------------------
corporation that is validly existing and in good standing under the laws of
the State of Delaware and has, either directly or indirectly, majority
ownership interests in the entities set forth on Schedule 4(a) (the
"Noramptco Subsidiaries"). Each of the Noramptco Subsidiaries is a
corporation that is validly
-7-
<PAGE> 8
existing and in good standing under the laws of the respective jurisdiction
indicated on Schedule 4(a) and Lamcor is a corporation that is validly existing
and in good standing under the laws of the United Kingdom. Noramptco, the
Noramptco Subsidiaries and Lamcor have all necessary corporate power and
authority and any necessary licenses or permits to own their respective
properties and assets and carry on their respective businesses as currently
conducted, except where the failure to have such licenses or permits would not
have a material adverse effect on the assets, properties, financial condition
or results of operations of Noramptco and the Noramptco Subsidiaries taken as a
whole (a "Material Adverse Effect"). Noramptco, the Noramptco Subsidiaries and
Lamcor are duly qualified to do business and are in good standing in each
jurisdiction in which the ownership of their respective assets or the conduct
of their respective businesses requires such qualification, except where the
failure to be so qualified would not have a Material Adverse Effect.
(b) Capital Stock. The authorized capital stock of Noramptco, each
-------------
Noramptco Subsidiary and Lamcor, together with the respective number of
shares issued and outstanding and the respective holders thereof, is as set
forth on Schedule 4(b). All of the issued and outstanding shares of common
stock of Noramptco and all of the issued and outstanding shares of capital
stock of each of the Noramptco Subsidiaries and Lamcor is validly issued,
fully paid and nonassessable. The Stockholder owns all of the issued and
outstanding shares of capital stock indicated on Schedule 4(b) as being owned
by him, free and clear of all liens, encumbrances or claims, and has the
right and power to sell and deliver such capital stock to Gardner Denver
without violating any agreement by which the Stockholder or the relevant
issuer is bound and without the consent of any other person. There are no
outstanding options,
-8-
<PAGE> 9
warrants or other rights to convert any obligation into or otherwise acquire
any capital stock of Noramptco, any of the Noramptco Subsidiaries or Lamcor.
(c) Financial Statements. Noramptco has delivered to Gardner Denver
--------------------
copies of (i) the consolidated balance sheets of Noramptco and the Noramptco
Subsidiaries as of January 31, 1996, 1995 and 1994, and the related
statements of income, cash flows and stockholders' equity, together with the
notes thereto, for the periods then ended, which financial statements (the
"Noramptco Financial Statements") have been reviewed by Ernst & Young LLP,
and (ii) the consolidated balance sheets of Lamson Corporation as of January
31, 1996, 1995 and 1994, and the related consolidated statements of income,
cash flows and stockholders' equity, together with the notes thereto, for the
periods then ended, which financial statements (the "Lamson Financial
Statements") have been audited by Ernst & Young LLP. The Noramptco Financial
Statements and the Lamson Financial Statements have been prepared in
accordance with generally accepted accounting principles consistently applied
and present fairly in all material respects the consolidated financial
position and results of operations of Noramptco and the Noramptco
Subsidiaries as of the dates and for the periods indicated and present fairly
in all material respects the consolidated financial position and results of
operations of Lamson and its subsidiary as of the dates and for the periods
indicated.
(d) Inventories and Receivables. All inventories shown on Noramptco's
---------------------------
consolidated balance sheet as of January 31, 1996, and thereafter acquired or
produced to the date hereof, are in the aggregate and in all material
respects usable or saleable in the normal course of the business of Noramptco
and the Noramptco Subsidiaries. Except as set forth on Schedule 4(d), the
accounts receivable shown on such consolidated balance sheet or arising
thereafter to the date
-9-
<PAGE> 10
hereof have been validly obtained in the ordinary course of business and have
been collected or are believed by Noramptco to be collectible in the ordinary
course of business consistent with past practices (subject to the allowance for
doubtful accounts), and to Noramptco's and the Stockholder's knowledge, there
are no refunds, reimbursements, discounts, or other adjustments payable by
Noramptco or any Noramptco Subsidiary in respect of such accounts receivable
other than those payable in the ordinary course of business consistent with
past practices and policies.
(e) Undisclosed Liabilities. Except as set forth on Schedule 4(e),
-----------------------
neither Noramptco nor any Noramptco Subsidiary has any liabilities or
obligations of any kind (whether accrued, absolute, contingent or otherwise)
not fully reflected or reserved against in Noramptco's consolidated balance
sheet as of January 31, 1996, other than those incurred in the ordinary
course of business since such date, which in the aggregate do not have a
Material Adverse Effect. Except as set forth on Schedule 4(e), neither
Noramptco nor the Stockholder has knowledge of any facts that would serve as
the basis for any liabilities or obligations of Noramptco or any of the
Noramptco Subsidiaries not disclosed in such balance sheet or the Schedules
to this Agreement or not incurred in the ordinary course of business that
would, when considered collectively, have a Material Adverse Effect.
(f) Title to Assets. Except as set forth on Schedule 4(f), and except
---------------
for assets held pursuant to leases, all of which are in full force and
effect, Noramptco and the Noramptco Subsidiaries have possession of and good
title to all assets owned and used in their respective businesses (including
the issued and outstanding capital stock of Noramptco Subsidiaries owned by
Noramptco and other Noramptco Subsidiaries), free and clear of all liens,
mortgages, easements, encumbrances, claims, restrictions or charges of any
kind, except liens for real
-10-
<PAGE> 11
property taxes and assessments not yet due and payable. Schedule 4(f) contains
a listing of all real property owned or leased, as well as all other items
leased, by Noramptco or the Noramptco Subsidiaries and used in their respective
businesses.
(g) Condition of Assets. Except as set forth in Schedule 4(g), the
-------------------
buildings, facilities, machinery, equipment, tools and other assets of
Noramptco and the Noramptco Subsidiaries are, as a whole, in the operating
condition, working order and repair, consistent with their respective ages
and subject to normal wear and tear, sufficient to conduct the respective
businesses of Noramptco and the Noramptco Subsidiaries as currently
conducted.
(h) Intellectual Property. Schedule 4(h) sets forth all patents,
---------------------
patent applications, trademarks, trademark applications, trade names and
service marks currently used by Noramptco or the Noramptco Subsidiaries.
Either Noramptco or a Noramptco Subsidiary owns and has good title to, or
possesses enforceable licenses or other rights to use, all items listed on
Schedule 4(h) and all other intellectual property used by Noramptco or any
Noramptco Subsidiary in its respective business. Except as set forth in
Schedule 4(h), neither Noramptco nor any Noramptco Subsidiary has been
charged in writing with infringement, or to the best of Noramptco's or the
Stockholder's knowledge, has infringed or is threatened to be charged with
infringement, with respect to any unexpired patent, trademark, trade name or
other proprietary right of any other party.
(i) Material Adverse Change. Since January 31, 1996, there has not
-----------------------
been any material adverse change in the business or financial condition of
Noramptco and the Noramptco Subsidiaries taken as a whole, or any damage,
destruction or loss, whether or not covered by insurance, affecting a
material amount of the properties or business of Noramptco or, when
-11-
<PAGE> 12
considered individually, any Noramptco Subsidiary. Neither Noramptco nor any
Noramptco Subsidiary is a party to any contract, agreement, lease or
commitment, or is subject to any judgment, order, writ, injunction, decree or
award, which materially and adversely affects, or in the future can
reasonably be expected to materially and adversely affect, the business or
financial condition of Noramptco or any Noramptco Subsidiary (without regard
to matters concerning lost opportunity).
(j) Dividends. Since January 31, 1996, no dividends have been
---------
declared or paid upon shares of Noramptco common stock or shares of Lamson
common stock.
(k) Employment and Contractual Matters. Except as set forth on
----------------------------------
Schedule 4(k), neither Noramptco nor any Noramptco Subsidiary is a party to
or bound by any (i) contract or arrangement for the employment or
compensation of any officer, employee or agent calling for remaining payments
in excess of $50,000 and not cancelable at will by Noramptco or the
respective Noramptco Subsidiary; (ii) collective bargaining or other similar
labor agreement with any labor union or labor organization; (iii) consulting
or other similar contracts calling for remaining payments in excess of
$50,000; (iv) agreement relating to the borrowing of money, not reflected on
Noramptco's consolidated balance sheet as of January 31, 1996; (v) guaranty
of any obligation of another; (vi) written agreement with any present or
former officer, director, employee or agent of Noramptco or any Noramptco
Subsidiary or with any business in which any of such persons have an
interest; or (vii) other contract, agreement, lease or commitment involving
aggregate expenditures of more than $25,000 (other than purchase orders and
other agreements with customers of Noramptco or any Noramptco Subsidiary
received or entered into in the ordinary course of business).
-12-
<PAGE> 13
(l) Litigation, Claims and Compliance with Laws. Except as set forth
-------------------------------------------
on Schedule 4(l), there are no actions, suits or proceedings pending, or to
the best of Noramptco's and the Stockholder's knowledge, threatened, against
or affecting Noramptco or any Noramptco Subsidiary, at law or in equity
before any court or before or by any governmental agency or instrumentality,
or before any arbitrator, including any unfair labor practice charges or
pending grievance proceedings. Except as set forth on Schedule 4(l), to the
best of Noramptco's and the Stockholder's knowledge, there are no existing
facts that could reasonably lead to any unfair labor practice charge or any
basis for any action or proceeding against Noramptco or any Noramptco
Subsidiary arising out of any statute or regulation relating to
discrimination in employment or employment practices or occupational safety
and health standards, which if adversely determined would have a Material
Adverse Effect. Neither Noramptco nor any Noramptco Subsidiary is in default
with respect to any order, judgment, writ, injunction or decree of any court,
arbitrator or governmental agency or instrumentality and no event has
occurred which with notice or lapse of time or both would constitute such a
default. To the best of Noramptco's and the Stockholder's knowledge and
without derogation from the representations and warranties contained in this
Agreement relating to specific subject matters, Noramptco and the Noramptco
Subsidiaries are in compliance with all statutes, rules, regulations,
ordinances, licenses, permits and authorizations applicable to them or their
respective businesses, except where failure to be in compliance would not
have a Material Adverse Effect.
(m) Environmental Matters. Except as set forth on Schedule 4(m), to
---------------------
the best of the Stockholder's knowledge after reasonable inquiry, (i) neither
Noramptco nor any Noramptco
-13-
<PAGE> 14
Subsidiary has received any written notice of violation under Environmental
Laws (as hereinafter defined) and Noramptco and the Noramptco Subsidiaries have
been and currently are in compliance with all Environmental Laws, except for
any violation which has not had and will not have a Material Adverse Effect or
a material adverse effect on the business of Lamson or U. S. Turbine
Corporation, when considered individually; (ii) there is no civil, criminal or
administrative action, suit, demand, claim, or proceeding pending or threatened
against Noramptco or any Noramptco Subsidiary relating to Environmental Laws;
and (iii) there has not been, and is not occurring, any disposal or release of
any Materials of Environmental Concern (as hereinafter defined) in, on or from
any properties owned or operated by Noramptco or the Noramptco Subsidiaries in
their respective businesses, except disposals or releases that have not had and
will not have a Material Adverse Effect or a material adverse effect on the
business of Lamson or U.S. Turbine Corporation, when considered individually.
(n) Employee Benefit Plan Matters.
-----------------------------
(i) Noramptco and the Noramptco Subsidiaries currently maintain,
and have maintained in the past, only the employee pension benefit plans, as
defined in Section 3(2) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), listed on Schedule 4(n) (the "Pension Plans").
As to each Pension Plan, Noramptco has furnished to Gardner Denver a copy of
the Pension Plan and all amendments thereto as currently in effect, any
related funding agreement, the current summary plan description, any
participant informational material, any actuarial valuation reports for the
most recent three plan years, a copy of Form 5500 for the most recent five
plan years, and a copy of the most recent determination letter issued by the
Internal Revenue Service.
-14-
<PAGE> 15
(ii) Noramptco and the Noramptco Subsidiaries currently
maintain, and have maintained in the past, only the employee welfare benefit
plans, as defined in Section 3(1) of ERISA (including without limitation life
insurance, medical, hospitalization, holiday, vacation, dental and vision
plans) listed on Schedule 4(n) (the "Welfare Plans"). As to each Welfare
Plan, Noramptco has furnished to Gardner Denver a copy of the Welfare Plan
and all amendments thereto, the current summary plan description, any
participant informational material, any information regarding funding
arrangements, and a copy of the most recent Form 5500 if one was required to
be filed.
(iii) Except as set forth on Schedule 4(n), during the past five
years, neither Noramptco nor any affiliate (as defined in Section 1563(a) of
the Internal Revenue Code of 1986, as amended) of Noramptco has contributed
to any multiemployer plan, as defined by Section 3(37) of ERISA.
(iv) Each Pension Plan has been administered in accordance with
its terms and in compliance with ERISA, federal securities laws, the federal
Age Discrimination in Employment Act, as amended, and any state law
prohibiting discrimination on account of age, together with any applicable
regulations and rulings, except where the failure to be so administered would
not have a Material Adverse Effect.
(v) Noramptco and/or the appropriate Noramptco Subsidiary has
complied with applicable "COBRA continuation" requirements of Section
4980B(f) of the Internal Revenue Code of 1986, as amended, with respect to
each Welfare Plan that is a group health plan (as defined in Section
5000(b)(1) of such Code).
(o) Taxes. Except as set forth on Schedule 4(o), Noramptco and the
-----
Noramptco
-15-
<PAGE> 16
Subsidiaries have (i) filed all tax returns required to be filed by any
jurisdiction as to which they are subject and have paid all taxes shown
to be due on such returns, (ii) paid in full on a timely basis all taxes
claimed in a written notice to be due by each such jurisdiction, subject to
audit by the taxing authority of such jurisdiction and (iii) made timely
payments of all taxes required to be deducted and withheld from the wages
paid to employees. In all material respects, such returns accurately and
completely set forth all relevant items and accurately reflect the tax
liabilities for the periods covered by such returns, and the accrual on the
consolidated balance sheet of Noramptco and the Noramptco Subsidiaries as of
January 31, 1996 for all unpaid taxes related to operations through such date
accurately reflects (and the accrual for such taxes on the Closing Balance
Sheet will accurately reflect) the tax liabilities of Noramptco and the
Noramptco Subsidiaries for the year ended January 31, 1996 and the period
ending on the Closing Date, respectively; provided that, in the event an
audit of Noramptco by any United States taxing authority ultimately results
(by virtue of settlement or otherwise) in material additional income tax
liability for any taxable year ending on or before the Closing Date (or, with
respect to the taxable year containing the Closing Date, for that portion of
the taxable year ending on the Closing Date) on account of the disallowance
by such taxing authority of any deductions previously claimed by Noramptco or
any Noramptco Subsidiary, then the tax returns or the accruals on the balance
sheets shall not be deemed to accurately reflect the tax liabilities for such
periods to the extent of such additional material income tax liabilities. No
tax deficiency or penalty has been asserted in writing, or to the best of
Noramptco's and the Stockholder's knowledge, threatened, by any such
jurisdiction against Noramptco or any Noramptco Subsidiary. To the best of
Noramptco's and the Stockholder's knowledge, there is no audit of
-16-
<PAGE> 17
any tax return of Noramptco or any Noramptco Subsidiary in progress. Except as
set forth on Schedule 4(o), neither Noramptco nor any Noramptco Subsidiary has
(i) waived any statute of limitations with respect to tax obligations or
agreed to any extension of time with respect to a tax assessment or
deficiency, (ii) been a party to any tax allocation or sharing agreement,
(iii) been a member of an affiliated group (other than the Noramptco
affiliated group) filing a consolidated federal income tax return, nor taken
any other action that could result in liability for taxes of an affiliated
group, or (iv) received a written claim made by an authority in a
jurisdiction where it does not file tax returns that it is or may be subject
to taxation by that jurisdiction.
(p) Insurance. Noramptco and the Noramptco Subsidiaries maintain
---------
insurance as set forth on Schedule 4(p). Such insurance is in full force and
effect and copies of all existing insurance policies carried by Noramptco and
the Noramptco Subsidiaries have been made available to Gardner Denver.
(q) No Defaults. Neither Noramptco nor any Noramptco Subsidiary is in
-----------
default (nor has any event occurred which, with the passage of time and/or
the giving of notice, would constitute a default) with respect to any
obligation to be performed by Noramptco or any Noramptco Subsidiary under any
agreement, contract or commitment to which Noramptco or a Noramptco
Subsidiary is a party, such that, in the aggregate, such defaults (and
events) would have a Material Adverse Effect nor, to the best of Noramptco's
and the Stockholder's knowledge, has there been any default (or any such
event) in any obligation to be performed by any other party to any such
agreement, contract or commitment, such that, in the aggregate, such defaults
(and events) would have a Material Adverse Effect.
-17-
<PAGE> 18
(r) Government Contracts. Except as set forth on Schedule 4(r),
--------------------
neither Noramptco nor any Noramptco Subsidiary has any contract with the
United States or any agency thereof, or any related subcontract, that is
subject to renegotiation under applicable law or that requires the consent of
the United States government to its assignment.
(s) Authority; Effect of Agreement. The execution and delivery of
------------------------------
this Agreement by Noramptco, the performance by Noramptco of its covenants
and agreements hereunder and the consummation by Noramptco of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action. This Agreement constitutes a valid and legally binding
obligation of each of Noramptco and the Stockholder, enforceable in
accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting the enforcement
of creditors' rights generally and subject to general principles of equity.
(t) Conflicts. Neither the execution nor the performance of this
---------
Agreement by Noramptco or the Stockholder, nor the consummation by Noramptco
or the Stockholder of the transactions contemplated hereby, (i) violates any
term or provision of the Certificate of Incorporation or Bylaws of Noramptco,
Lamson, U. S. Turbine Corporation or Lamcor, (ii) subject to the expiration
or termination of the waiting period under the Hart-Scott-Rodino Act (as
hereinafter defined), constitutes a violation of any statute, ordinance,
regulation, order, judgment or decree of any court or governmental agency or
board, (iii) except as set forth on Schedule 4(t), results in the breach of
any term or provision of, or constitutes a default under or results in the
acceleration of any obligation under, any agreement, lease, instrument or
other restriction to which Noramptco or any Noramptco Subsidiary is a party
or by which it is bound
-18-
<PAGE> 19
and which is listed on Schedule 4(k), or (iv) requires the consent of any other
person or entity other than as indicated on Schedule 4(t) and other than the
appropriate federal antitrust regulatory authorities pursuant to the
Hart-Scott-Rodino Act.
(u) Litigation; Disputes. There are no claims, disputes, actions,
--------------------
suits or proceedings pending or, to the best of the knowledge of Noramptco or
the Stockholder, threatened, against or affecting Noramptco or the
Stockholder which challenge the validity of this Agreement, or which if
adversely determined, would adversely affect their ability to consummate the
transactions contemplated by this Agreement or to perform their covenants and
agreements under this Agreement.
(v) No Adverse Factors. Except for general economic conditions,
------------------
including those affecting the industry in which Noramptco and the Noramptco
Subsidiaries operate, there are no adverse conditions or factors materially
affecting the business of Noramptco or, when considered individually, any
Noramptco Subsidiary, which are known to Noramptco or the Stockholder and
which have not been disclosed to Gardner Denver.
(w) Charter and Bylaws. Noramptco has furnished to Gardner Denver
------------------
accurate and complete copies of (i) the certificate of incorporation and
bylaws (or similar documents) of Noramptco, the Noramptco Subsidiaries (other
than the Bylaws of Lamson Canada, Inc.) and Lamcor, as currently in effect,
and (ii) the minutes of all meetings of the stockholders and Boards of
Directors of Noramptco and the Noramptco Subsidiaries (and all consents in
lieu of such meetings) as reflected by the corporate records of Noramptco and
the Noramptco Subsidiaries, respectively, for the past three years. Such
minutes and consents accurately reflect, in all material respects, all
actions taken by their respective Boards of Directors,
-19-
<PAGE> 20
committees and stockholders.
5. REPRESENTATIONS AND WARRANTIES OF SELLING STOCKHOLDERS OTHER
------------------------------------------------------------
THAN THE STOCKHOLDER. Each of the persons identified in this Agreement as
- --------------------
being a selling stockholder of Lamson Europe S.A. (other than the Stockholder)
represents and warrants to Gardner Denver that he or she owns all of the shares
of capital stock set forth opposite his or her name in Section 1 hereof, free
and clear of all liens, encumbrances or claims, and has the right and power to
sell and deliver such shares to Gardner Denver without violating any agreement
by which he or she is bound and without the consent of any other person.
6. REPRESENTATIONS AND WARRANTIES OF GARDNER DENVER. Gardner Denver
------------------------------------------------
represents and warrants to Noramptco and the Stockholder as of the date hereof
as follows:
(a) Organization. Gardner Denver is a corporation that is validly
------------
existing and in good standing under the laws of the State of Delaware, with
all necessary corporate power and authority to enter into this Agreement and
perform its obligations hereunder.
(b) Authority. The execution and delivery of this Agreement by
---------
Gardner Denver, the performance by Gardner Denver of its covenants and
agreements hereunder and the consummation by Gardner Denver of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action. This Agreement constitutes a valid and legally binding
obligation of Gardner Denver, enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium and
other similar laws affecting the enforcement of creditors' rights generally
and subject to general principles of equity.
(c) Conflicts. Neither the execution nor performance of this
---------
Agreement by Gardner Denver, nor the consummation by Gardner Denver of the
transactions contemplated hereby, (i)
-20-
<PAGE> 21
violates any provision of the Certificate of Incorporation or Bylaws of Gardner
Denver, (ii) subject to the expiration or termination of the waiting period
under the Hart-Scott-Rodino Act, constitutes a violation of any statute,
ordinance, regulation, order, judgment or decree of any court or governmental
agency or board, or (iii) requires the consent of any other person or entity
other than the appropriate federal antitrust regulatory authorities pursuant to
the Hart-Scott-Rodino Act.
(d) Litigation; Disputes. There are no claims, disputes, actions,
--------------------
suits or proceedings pending or, to the best of the knowledge of Gardner
Denver, threatened, against or affecting Gardner Denver which challenge the
validity of this Agreement, or which if adversely determined, would adversely
affect its ability to consummate the transactions contemplated by this
Agreement or to perform its covenants and agreements under this Agreement.
(e) Financing. Gardner Denver has delivered to the Stockholder the
---------
written confirmation of The First National Bank of Chicago to the effect that
Gardner Denver has the right to borrow under its existing Credit Agreement
funds sufficient to pay the aggregate purchase price called for by this
Agreement, and there is sufficient availability under such Credit Agreement
to borrow funds sufficient to pay such aggregate purchase price.
7. ADDITIONAL PRE-CLOSING AGREEMENTS OF THE PARTIES. The
------------------------------------------------
Stockholder and Gardner Denver additionally agree as follows:
(a) Conduct of Business. From the date of this Agreement until the
-------------------
earlier of the Closing or the termination of this Agreement, Noramptco and
the Noramptco Subsidiaries will carry on their respective businesses in the
ordinary course consistent with past practices, except as consented to in
writing by Gardner Denver and except as may be necessary to carry out this
-21-
<PAGE> 22
Agreement. During such period, without the prior written consent of Gardner
Denver, neither Noramptco nor any Noramptco Subsidiary (i) will engage in
activities that collectively would have a Material Adverse Effect, or (ii)
will engage in actions resulting in material capital expenditures (other than
those disclosed in the Schedules hereto), borrowings (other than in the
ordinary course of business pursuant to existing credit facilities), employee
compensation and benefit increases (other than those required by existing
agreements and written arrangements), or any transfer or other restructuring
of ownership interests in Noramptco Subsidiaries, provided that Lamson may
execute the Union Contract between Lamson and the United Steel Workers of
America, Local Union 8976, covering the period from June 8, 1995 to May 1,
1998 and may settle or otherwise deal with the grievances and other matters
set forth on Schedule 4(l). Noramptco and the Stockholder agree to use
reasonable best efforts during such period to keep the respective business
organizations of Noramptco and the Noramptco Subsidiaries intact, to keep
available the services of their present employees, and to preserve the
goodwill of their customers, suppliers and others having business relations
with them, all to the extent possible under the circumstances.
(b) Stockholder Bonus and Repayment of Advances. Notwithstanding
-------------------------------------------
anything to the contrary contained in Section 7(a) above, prior to the
Closing, Noramptco may credit the Stockholder with a bonus on account of his
services as Chief Executive Officer since January 31, 1996, which bonus may
be in excess of the aggregate amount accrued by Noramptco for any such bonus
since such date; provided, however, that in no event shall the amount of the
bonus be such that the Closing Net Worth (after taking into account such
bonus and all accruals contemplated by Section 2(b) hereof) exceeds the Base
Net Worth by less than $200,000. The
-22-
<PAGE> 23
parties hereto agree that the full amount of any such bonus credited to the
Stockholder (or such lesser amount as is required for full repayment) shall be
applied as repayment of advances previously made to the Stockholder and
currently owing to Noramptco, any of the Noramptco Subsidiaries, or Lamcor.
(c) Access to Information. From the date of this Agreement until the
---------------------
Closing, the Stockholder will cause Noramptco and the Noramptco Subsidiaries
to afford to representatives of Gardner Denver, at Gardner Denver's sole
expense, during normal business hours, upon reasonable notice and without
undue interruption, full access to any and all premises, personnel and
information with respect to Noramptco and the Noramptco Subsidiaries, and to
furnish to Gardner Denver, either orally or by means of such records,
documents, and memoranda as are reasonably available or capable of
preparation, such assistance and information as Gardner Denver may reasonably
request. Noramptco shall furnish to Gardner Denver the unaudited monthly
financial statements of Lamson and U. S. Turbine Corporation that customarily
would be prepared between the date of this Agreement and the Closing, as
promptly as practicable after such financial statements are available.
(d) Regulatory Authorizations. The parties will use their respective
-------------------------
reasonable best efforts to file promptly after the execution of this
Agreement, with the Federal Trade Commission and the Antitrust Division of
the Department of Justice, Notification and Report Forms and documentary
material which comply with the provisions of the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 and the rules thereunder (the "Hart-Scott-Rodino
Act"), and will use their respective reasonable best efforts to file promptly
any additional information requested as soon as practicable after receipt of
the request. The parties will not take any action
-23-
<PAGE> 24
that will have the effect of delaying, impairing or impeding the receipt of any
required governmental approvals and will use their respective reasonable best
efforts to secure such approvals as promptly as possible.
(e) Announcements. From the date of this Agreement until the earlier
-------------
of the Closing or the termination of this Agreement, neither Noramptco, the
Stockholder nor Gardner Denver shall issue any media, newspaper, wire
service, trade journal or any other public statement concerning the
transactions contemplated hereby, without the approval of the other parties,
except as may be required by law or applicable disclosure obligations and
after notice to the other parties. Noramptco and the Stockholder acknowledge
that Gardner Denver may issue a press release (the text of which shall be
provided to the Stockholder at the time of the execution of this Agreement)
and hold a telephonic meeting with industry analysts following the execution
of this Agreement and, to the extent deemed necessary under this Section
7(e), Noramptco and the Stockholder hereby approve such actions. It is
acknowledged that Noramptco, the Stockholder and Gardner Denver may make
announcements to employees, customers, suppliers and lenders and may respond
to news media inquiries following the execution of this Agreement and, to the
extent deemed necessary under this Section 7(e), each of such parties hereby
approves such actions by the other parties.
(f) Exclusivity. From the date of this Agreement until the earlier of
-----------
the Closing or the termination of this Agreement, neither the Stockholder,
members of management of Noramptco or the Noramptco Subsidiaries, nor
representatives of Noramptco or the Stockholder or such management, including
Tucker Anthony Incorporated, will (i) solicit offers or enter into
discussions with any other party for any sale, lease or business combination
("Transaction")
-24-
<PAGE> 25
involving Noramptco or the Noramptco Subsidiaries or any of its or their assets
outside of the ordinary course of business, (ii) provide any information about
Noramptco or the Noramptco Subsidiaries or business to any person in response
to a solicited or unsolicited inquiry with respect thereto in connection with
any potential Transaction, or (iii) commence any process with a view toward any
potential Transaction, in each case other than in connection with the
transactions with Gardner Denver that are the subject of this Agreement.
8. CONDITIONS PRECEDENT TO CLOSING BY GARDNER DENVER. The
-------------------------------------------------
obligation of Gardner Denver to close the transactions contemplated by this
Agreement is subject to satisfaction of each of the following conditions,
unless waived in writing by Gardner Denver:
(a) Representations and Warranties. The representations and
------------------------------
warranties made by Noramptco and the Stockholder in this Agreement, as may be
amended in accordance with the next succeeding sentence, shall be true and
correct in all material respects as of the Closing Date with the same force
and effect as though made on the Closing Date and Noramptco and the
Stockholder shall have complied in all material respects with all the terms
and conditions and performed in all material respects all of its or his
obligations contained in this Agreement, and Gardner Denver shall have
received a certificate to such effect dated the Closing Date and signed by
Noramptco and the Stockholder. Noramptco and the Stockholder shall be
entitled to deliver to Gardner Denver, from time to time but not less than
three business days prior to the Closing Date, a notification (each, an
"Update Notice") that updates, modifies, supplements or adds to the Schedules
hereto, or adds additional Schedules hereto, and upon delivery of such an
Update Notice, the applicable representations and warranties (and the
applicable Schedules), for all purposes of this Agreement, shall be deemed to
be amended to be consistent with each such
-25-
<PAGE> 26
Update Notice. In the event Gardner Denver receives one or more Update Notices
which, when considered collectively, set forth the occurrence or existence of
events or circumstances which have had or will have a Material Adverse Effect,
unless the matter set forth in the Update Notice is cured within 15 days after
written notice from Gardner Denver, the parties hereto agree to negotiate in
good faith an adjustment to the purchase price appropriate to reflect the
Material Adverse Effect set forth in the Update Notices. In the event that
the parties hereto are unable to so negotiate an adjustment to the purchase
price within 15 days after the first of such negotiations, Gardner Denver
shall have no obligation to complete the closing of the transactions
contemplated by this Agreement and shall be entitled (as its sole and
exclusive remedy in such event) to terminate this Agreement pursuant to
Section 10(a)(iv) below.
(b) Antitrust. The applicable waiting periods (including any
---------
extensions) under the Hart-Scott-Rodino Act and the rules thereunder shall
have expired or been terminated, and there shall be in effect no preliminary
or permanent injunction or other order of a court or governmental or
regulatory agency of competent jurisdiction directing that the transactions
contemplated by this Agreement not be consummated.
(c) Legal Opinion. Gardner Denver shall have received from Haythe &
-------------
Curley, counsel for Noramptco and the Stockholder, a written opinion dated
the Closing Date (i) covering certain of those matters set forth in Sections
4(a) and 4(b) of this Agreement, and further to the effect that (ii) this
Agreement has been duly authorized by Noramptco and executed and delivered by
Noramptco and the Stockholder and constitutes a legal, valid and binding
obligation of each of Noramptco and the Stockholder, enforceable in
accordance with its terms (subject to customary bankruptcy and equitable
principles qualifications), (iii) the consummation by Noramptco and
-26-
<PAGE> 27
the Stockholder of the transactions contemplated by this Agreement will not
violate any provision of the Certificate of Incorporation or Bylaws of
Noramptco, Lamson or U. S. Turbine Corporation or, except as set forth on
Schedule 4(t) and to the knowledge of such counsel, any agreement or
instrument to which Noramptco, any of the Noramptco Subsidiaries or Lamcor is
a party or by which any one of them is bound and which is listed on Schedule
4(k), (iv) all authorizations, approvals, permits and consents of, and all
filings, qualifications and registrations with, any governmental authority or
regulatory body of the United States or of or with any state, necessary or
required on the part of the Stockholder or Noramptco or any Noramptco
Subsidiary in connection with the consummation by Noramptco and the
Stockholder of the transactions contemplated by this Agreement have been duly
obtained or made, as the case may be, and (v) except as set forth on Schedule
4(l), such counsel knows of no litigation, cause of action, proceedings or
governmental investigation pending or threatened against or relating to the
Stockholder or Noramptco or any Noramptco Subsidiary or the property or
business of Noramptco or any Noramptco Subsidiary which would have a Material
Adverse Effect.
(d) Closing Deliveries. Gardner Denver shall have received at or
------------------
prior to the Closing:
(i) all consents of third parties set forth on Schedule 4(t)
and designated with an asterisk;
(ii) resignations of such directors and officers of Noramptco,
the Noramptco Subsidiaries and Lamcor as shall have been
requested by Gardner Denver;
(iii) the records, books, corporate seal and
stock ledger of Noramptco, the Noramptco Subsidiaries and
Lamcor; and
(iv) if requested by Gardner Denver, written instructions to
banks utilized by
-27-
<PAGE> 28
Noramptco, any Noramptco Subsidiary or Lamcor canceling the
right of any or all current signatories to sign checks and
transact any business with such banks with respect to bank
accounts of Noramptco, the respective Noramptco Subsidiary or
Lamcor.
9. CONDITIONS PRECEDENT TO CLOSING BY NORAMPTCO AND THE STOCKHOLDER.
----------------------------------------------------------------
The obligation of Noramptco and the Stockholder to close the transactions
contemplated by this Agreement is subject to satisfaction of each of the
following conditions, unless waived in writing by Noramptco or the Stockholder:
(a) Representations and Warranties. The representations and
------------------------------
warranties made by Gardner Denver in this Agreement shall be true and correct
in all material respects as of the Closing Date with the same force and
effect as though made on the Closing Date and Gardner Denver shall have
complied in all material respects with all the terms and conditions and
performed in all material respects all of its obligations contained in this
Agreement, and the Stockholder shall have received a certificate to such
effect dated the Closing Date and signed by Gardner Denver.
(b) Antitrust. The applicable waiting periods (including any
---------
extensions) under the Hart-Scott-Rodino Act and the rules thereunder shall
have expired or been terminated, and there shall be in effect no preliminary
or permanent injunction or other order of a court or governmental or
regulatory agency of competent jurisdiction directing that the transactions
contemplated by this Agreement not be consummated.
(c) Legal Opinion. The Stockholder shall have received from Squire,
-------------
Sanders & Dempsey, counsel for Gardner Denver, a written opinion dated the
Closing Date to the effect
-28-
<PAGE> 29
that (i) Gardner Denver is a corporation that is validly existing and in good
standing under the laws of the State of Delaware, with all necessary corporate
power and authority to enter into this Agreement and perform its obligations
hereunder, (ii) this Agreement has been duly authorized, executed and delivered
by Gardner Denver and constitutes a legal, valid and binding obligation of
Gardner Denver, enforceable in accordance with its terms (subject to customary
bankruptcy and equitable principles qualifications), (iii) the consummation of
the transactions contemplated by this Agreement will not violate any provision
of the Certificate of Incorporation or Bylaws of Gardner Denver or, to the
knowledge of such counsel, any agreement or instrument to which Gardner Denver
is a party or by which it is bound, and (iv) all authorizations, approvals,
permits and consents of, and all filings, qualifications and registrations
with, any governmental authority or regulatory body of the United States or
of or with any state, necessary or required on the part of Gardner Denver in
connection with the consummation by Gardner Denver of the transactions
contemplated by this Agreement have been duly obtained or made, as the case
may be.
-29-
<PAGE> 30
10. TERMINATION AND ABANDONMENT.
---------------------------
(a) Right to Terminate. This Agreement may be terminated and the
------------------
contemplated transactions abandoned prior to the Closing Date in the
following manner:
(i) By mutual written consent of Noramptco, the Stockholder and
Gardner Denver; or
(ii) unless extended by written agreement of Noramptco, the
Stockholder and Gardner Denver, at any time after October 31, 1996, by either
Gardner Denver or Noramptco and the Stockholder (considered as a single party
for this purpose) in writing, if the transactions contemplated by this
Agreement have not been consummated on or before such date and such
terminating party has not prevented consummation of such transactions by
reason of a material breach of this Agreement; or
(iii) at any time before the Closing, by either Gardner Denver
or Noramptco and the Stockholder (considered as a single party for this
purpose) in writing, in the event that any governmental authority shall have
issued an order, decree, ruling or taken any other action restraining,
enjoining or otherwise prohibiting the transactions contemplated by this
Agreement and such order, decree, ruling or other action shall have become
final and nonappealable; or
(iv) at any time before the Closing, by Gardner Denver in
writing pursuant to Section 8(a) hereof; or
(v) at any time before the Closing, by either Gardner Denver or
Noramptco and the Stockholder (considered as a single party for this purpose)
in writing, if such terminating party is not then in material breach of this
Agreement, and the nonterminating party has failed to perform in any material
respect any of its covenants or agreements contained herein or is in
-30-
<PAGE> 31
breach in any material respect of any of its representations or warranties
contained herein, and such nonterminating party has not cured in all material
respects such nonperformance or breach within 15 days after receiving written
notice from the terminating party of such failure to perform or such breach.
(b) Effect of Termination. If, for any reason, this Agreement is
---------------------
terminated and the contemplated transactions are abandoned as provided in
Section 10(a), this Agreement shall become void and have no further force and
effect (other than this Section 10(b), Section 10(c), Section 12, Section 14,
and Section 16(e), and neither Noramptco, any of the Noramptco Subsidiaries,
the Stockholder, the other selling stockholders hereunder nor Gardner Denver
(including their respective officers and directors) shall have any liability
or obligation to the other in Damages (as hereinafter defined) or as to
expenses incurred incident to this Agreement or the contemplated
transactions. Notwithstanding anything to the contrary contained in the
preceding sentence, in the event of a termination of this Agreement pursuant
to Section 10(a)(v) above where the nonterminating party has refused to close
the transactions contemplated hereby (notwithstanding that the nonterminating
party's conditions to close contained in Sections 8 or 9, as applicable, have
been satisfied or, that the terminating party stands ready, willing and able
to satisfy such conditions but for such refusal), the nonterminating party
shall be liable to the terminating party for such refusal; provided, however,
the parties hereto recognize and agree that since the amount of the
terminating party's Damages would be extremely difficult and impracticable to
ascertain, the terminating party's sole and exclusive remedy under such
circumstances shall be to receive from the nonterminating party, and the
nonterminating party shall pay, as liquidated damages an amount in cash equal
to $2,000,000.
-31-
<PAGE> 32
(c) Return of Documentation. As promptly as practicable following a
-----------------------
termination of this Agreement in accordance with Section 10(a), Gardner
Denver shall return all agreements, documents, contracts, instruments, books,
records, materials and all other information relating to Noramptco, any of
the Noramptco Subsidiaries or Lamcor provided by Noramptco, any of the
Noramptco Subsidiaries, Lamcor, the Stockholder or by any representative of
such parties to Gardner Denver or any representatives of Gardner Denver in
connection with the transactions contemplated by this Agreement.
11. INDEMNIFICATION.
---------------
(a) Indemnification by the Stockholder. After the Closing Date,
----------------------------------
subject to the terms hereof, the Stockholder shall indemnify and hold
harmless Gardner Denver (and its officers, directors and its affiliated
entities) (collectively, the "Purchaser Indemnified Parties") from and
against all losses, damages, liabilities, costs and expenses, including,
without limitation, Counsel Expenses (as defined below) (herein referred to
collectively as "Damages"), which are sustained or incurred by any of the
Purchaser Indemnified Parties, to the extent that the Damages are sustained
or incurred by reason of (i) the breach by Noramptco or the Stockholder of
any of Noramptco's or the Stockholder's covenants or agreements made in this
Agreement or (ii) the breach of any of the representations or warranties made
by Noramptco or the Stockholder in Section 4 hereof. "Counsel Expenses"
shall mean reasonable fees and disbursements of counsel sustained or incurred
by the Purchaser Indemnified Parties or the Seller Indemnified Party (as
defined below), as the case may be, in any action or proceedings (x) between
the Seller Indemnified Party and a Purchaser Indemnified Party, or (y)
involving a third-party claim against the Seller Indemnified Party or a
Purchaser Indemnified Party.
-32-
<PAGE> 33
(b) Indemnification by Gardner Denver. After the Closing Date,
---------------------------------
subject to the terms hereof, Gardner Denver shall indemnify and hold harmless
the Stockholder and the other selling stockholders hereunder (collectively,
the "Seller Indemnified Party") from and against all Damages which are
sustained or incurred by the Seller Indemnified Party, to the extent that
such Damages are sustained or incurred by reason of (i) the breach by Gardner
Denver of any of its covenants or agreements in this Agreement, (ii) the
breach of any of the representations or warranties made by Gardner Denver in
Section 6 hereof, (iii) any claim, proceeding or suit brought against the
Seller Indemnified Party under the Worker Adjustment Retraining and
Notification Act ("WARN"), or any similar local, state, federal or foreign
law which relates to actions taken by Gardner Denver at any time after the
Closing with regard to a plant closing or mass layoff at any site of
employment or one or more facilities or operating units within any site of
employment of Noramptco or any Noramptco Subsidiary, or (iv) any
Environmental Claim (as hereinafter defined).
(c) Procedure for Indemnification.
-----------------------------
(i) In the event that any Purchaser Indemnified Party or the
Seller Indemnified Party reasonably believes that such party has a claim for
Damages in respect of which indemnity may be sought by such party pursuant to
this Section 11 or Section 12, the party indemnified hereunder (the
"Indemnitee") shall notify the party providing indemnification (the
"Indemnitor") by sending written notice to the Indemnitor (an "Indemnity
Notice"). In the case of third-party claims which could result in an
indemnity payment hereunder, an Indemnity Notice shall be given promptly
after the discovery by the Indemnitee of the filing or assertion of any claim
against the Indemnitee stating the nature and basis of such claim; provided,
however, that any
-33-
<PAGE> 34
delay or failure to notify any Indemnitor of any claim shall not relieve it
from any liability except to the extent that the Indemnitor demonstrates that
the defense of such action is prejudiced by such delay or failure to notify.
Any Indemnity Notice shall (x) state (with reasonable specificity) the basis on
which indemnification is being asserted, (y) set forth the amount of Damages
for which indemnification is being asserted, and (z) in the case of third-party
claims, be accompanied by copies of all relevant pleadings, demands and other
papers served on the Indemnitee.
(ii) In the case of third-party claims (including tax audits to
the extent related to a claim for which indemnity may be available under
Section 11(a) hereof) the Indemnitee shall give the Indemnitor the right (x)
to control and conduct any proceedings or negotiations in connection
therewith and necessary or appropriate to defend the Indemnitee (provided
such is pursued diligently and in a professional manner), (y) to take all
other reasonable steps or proceedings to settle or defend any such claims,
provided that the Indemnitor shall not settle any such claim without the
prior written consent of the Indemnitee, which consent will not be
unreasonably withheld or delayed, unless such settlement involves the payment
of money only, in which event the Indemnitor shall have the right to settle
any such claim without the consent of the Indemnitee, and (z) to employ
counsel selected by the Indemnitor, after reasonable consultation with the
Indemnitee, to contest any such claim or liability in the name of the
Indemnitee or otherwise. The Indemnitor shall, within 30 days of receipt of
an Indemnity Notice in respect of such claim, notify the Indemnitee in
writing of its intention to assume the defense of such claim. If the
Indemnitor does not so notify the Indemnitee that it will assume the defense
of any such claim, the Indemnitee may, at the Indemnitor's sole expense,
defend
-34-
<PAGE> 35
against any such claim in such manner as it may deem appropriate and
the Indemnitee may settle such claim on such terms as it may deem
appropriate, provided that the Indemnitee shall not settle any such claim
without the prior written consent of the Indemnitor, which consent will not
be unreasonably withheld or delayed. In the event that the Indemnitor does
not assume the defense as provided above, the Indemnitor shall have the right
to fully participate in such defense (including, without limitation, with
counsel of its choice), at its sole expense, and the Indemnitee shall fully
cooperate with the Indemnitor in connection with such participation, and in
all cases the Indemnitee shall keep the Indemnitor fully informed as to all
matters concerning such third-party claim and shall promptly notify the
Indemnitor in writing of any and all significant developments relating
thereto.
(iii) In the event that liability hereunder does not involve a
third-party claim, the Indemnitor shall within 30 days after the date of
receipt of an Indemnity Notice respond in writing to the Indemnitee and set
forth with reasonable specificity any items in the Indemnity Notice to which
the Indemnitor does not agree as well as the summary basis upon which such
disagreement is founded. The parties agree to negotiate in good faith for up
to 30 days in an attempt to reach a settlement of any disputed matter. In
the event that such good faith negotiations are unsuccessful or in the event
of any other dispute under this Section 11, the parties shall submit such
dispute to a court of competent jurisdiction.
(d) Limits on Indemnification Liability.
-----------------------------------
(i) Except as provided in the last sentence of this Section
11(d)(i), the Stockholder shall not be liable for indemnification under
Section 11(a) above, and Gardner Denver shall not be liable for
indemnification under Section 11(b) above, unless and until the
-35-
<PAGE> 36
aggregate amount of Damages sustained or incurred and to which indemnity
relates exceeds $250,000 (the "Basket Amount"), such that if the Damages exceed
the Basket Amount, then the indemnification liability pursuant to Section 11(a)
or Section 11(b), as the case may be, shall be limited to the amount of such
Damages sustained or incurred which exceeds the Basket Amount, subject to the
limitation described in the next succeeding sentence. Except as provided in
the next succeeding sentence, neither the Stockholder nor Gardner Denver, as
the case may be, shall be liable for indemnification under Section 11(a) or
Section 11(b) for Damages sustained or incurred in excess of $3,000,000 (the
"Maximum Limiting Amount"), such that the maximum aggregate amount of
indemnification liability of the Stockholder or Gardner Denver, as the case
may be, under this Section 11 for Damages sustained or incurred shall be the
difference between the Maximum Limiting Amount and the Basket Amount.
Notwithstanding the foregoing, Gardner Denver's indemnification liability
under Section 11(b)(iv) hereof for Environmental Claims shall be subject to a
"Basket Amount" of $50,000 but shall not otherwise be limited in amount, and
Gardner Denver's indemnification liability under Section 11(b)(iii) hereof
for WARN or similar claims shall not be subject to any "Basket Amount" and
shall not otherwise be limited in amount.
(ii) Subject to Section 16(b) hereof, all representations and
warranties contained in this Agreement or in any certificate delivered
pursuant hereto shall be deemed to have been relied upon by Noramptco, the
Stockholder or Gardner Denver, as the case may be, notwithstanding any
investigation heretofore or hereafter made or omitted by Noramptco, the
Stockholder or Gardner Denver, as the case may be, and shall survive the
Closing for 18 months, provided that the representations and warranties
contained in Section 4(b) shall survive
-36-
<PAGE> 37
indefinitely and the representations and warranties contained in Section 4(o)
shall survive for three years, and provided further that if written notice is
properly given under this Section 11 prior to the applicable expiration date
with respect to any alleged breach of a representation or warranty, such
representation or warranty with respect to such specified matter only shall
continue indefinitely until the applicable claim is finally resolved.
Notwithstanding anything to the contrary contained herein, the representation
and warranty contained in the second sentence of Section 4(o) regarding tax
returns and balance sheet tax accruals, to the extent related to additional
income tax liabilities resulting from the disallowance of deductions previously
claimed by Noramptco or any Noramptco Subsidiary, shall survive until the
expiration of the applicable statute of limitations.
(e) Losses Net. The amount of any Damages for which indemnification
----------
is provided under this Section 11 shall be net of tax benefits to be received
by the Indemnitee, and net of any amounts recoverable by the Indemnitee under
insurance policies with respect to such Damages.
(f) Sole and Exclusive Remedy. The parties hereto acknowledge and
-------------------------
agree that the sole and exclusive remedy with respect to Damages sustained or
incurred after the Closing Date in connection with the transactions
contemplated by this Agreement shall be in accordance with, and limited by,
the indemnification provisions set forth in this Section 11 and in Section
12. In furtherance of the foregoing, to the extent permitted by applicable
law, Gardner Denver hereby waives (on behalf of itself and on behalf of each
other Purchaser Indemnified Party) and the Stockholder hereby waives (on
behalf of himself and each other selling stockholder hereunder) all other
rights and remedies with respect to a claim for Damages relating to the
transactions
-37-
<PAGE> 38
contemplated by this Agreement, whether under applicable law (including
Environmental Laws), the common law or otherwise. Notwithstanding the
foregoing, nothing herein shall limit the rights or remedies of any party
hereto under applicable law for matters involving fraudulent conduct.
12. BROKER'S OR FINDER'S FEES. The Stockholder represents to
-------------------------
Gardner Denver that neither he nor Noramptco, any Noramptco Subsidiary nor
Lamcor has employed any broker, finder or similar agent in connection with
this transaction, except for Tucker Anthony Incorporated (whose fees and
expenses shall be paid by Noramptco and shall reduce the purchase price
payable to the Stockholder hereunder as provided in Section 2 above), and the
Stockholder agrees to indemnify and hold Gardner Denver harmless from any
claims for broker's commissions or finder's fees relating to this transaction
and arising by reason of any such action by the Stockholder or by Noramptco,
any Noramptco Subsidiary or Lamcor. Gardner Denver represents to the
Stockholder that it has employed no broker, finder or similar agent in
connection with this transaction and agrees to indemnify and hold the
Stockholder and the other selling stockholders hereunder harmless from any
claims for broker's commissions or finder's fees relating to this transaction
and arising by reason of any such action by Gardner Denver.
13. ASSIGNMENT. The rights and obligations of the parties hereto
----------
shall not be assignable by such parties without the written consent of the
Stockholder or Gardner Denver, as the case may be. Noramptco, the
Stockholder and the other selling stockholders hereby consent to any
nomination made by Gardner Denver of a subsidiary of Gardner Denver or
persons affiliated with Gardner Denver to take title to any of the shares of
capital stock to be transferred pursuant to this Agreement, provided that in
the event such nomination is made, Gardner Denver shall
-38-
<PAGE> 39
not be relieved of any of its obligations under this Agreement.
14. CONFIDENTIALITY. From the date of this Agreement until the
---------------
Closing, Gardner Denver agrees to treat as confidential all written and
electronic media and other information pertaining to the business or affairs
of Noramptco, the Noramptco Subsidiaries and Lamcor, which Noramptco or any
of its representatives has furnished to Gardner Denver in connection with the
transactions contemplated by this Agreement (the "Confidential Information"),
excluding (i) information that is or becomes generally available to the
public other than as a result of any disclosure by Gardner Denver in
violation of this Agreement; (ii) information available to Gardner Denver
from another source, which source is not (to Gardner Denver's knowledge)
prohibited from disclosing the information; (iii) information that was
developed by Gardner Denver independently from the information disclosed by
Noramptco; and (iv) information that was in Gardner Denver's possession prior
to any disclosure of information to Gardner Denver in connection with the
transactions contemplated by this Agreement. During such pre-Closing period,
Gardner Denver agrees not to disclose any Confidential Information to any
person or entity other than to its officers, directors, employees, or
representatives who need to review the Confidential Information in connection
with the transactions contemplated by this Agreement and further agrees to
use the Confidential Information, and to cause its officers, directors,
employees and representatives to use the Confidential Information, solely for
the purpose of evaluating and consummating the transactions contemplated by
this Agreement. In the event this Agreement is terminated in accordance with
the termination provisions of this Agreement, the obligations of
nondisclosure as set forth in this Section 14 shall continue for four years
from the date of this Agreement. Notwithstanding anything to the contrary
contained in this Section 14, Gardner
-39-
<PAGE> 40
Denver's obligations of nondisclosure shall be subject to any disclosure
requirements imposed by law.
15. NONCOMPETITION. For a period of five years following the
--------------
Closing of the transactions contemplated by this Agreement, the Stockholder
shall not directly or indirectly, without the written consent of Gardner
Denver, engage in any business or activity that is competitive with the
Business (as defined below). The Stockholder shall be considered to be
engaging in an activity that is competitive with the Business if he serves as
a proprietor, owner (other than of 5% or less of a publicly traded company),
partner, officer, director, employee or consultant of or for any organization
which engages, in any location in the world, in the manufacture, distribution
or sale of centrifugal or straight lobe blowers (the "Business").
Notwithstanding anything to the contrary contained in this Agreement, in the
event of a breach of this covenant, Gardner Denver shall be entitled to seek
an injunction restraining such breach in addition to any other remedies
provided by law or this Agreement. In the event this Section 15 shall be
determined by any court of competent jurisdiction to be unenforceable by
reason of its extending for too long a period of time, too great a
geographical area, or over too great a range of activities, it shall be
interpreted to extend only over the maximum period of time, area or range of
activities as to which it may be enforceable.
16. MISCELLANEOUS.
-------------
(a) No Other Representations or Warranties by Noramptco and the
-----------------------------------------------------------
Stockholder. Gardner Denver agrees that the representations and warranties
- -----------
expressly made by Noramptco and the Stockholder in Section 4 of this
Agreement (as such representations and warranties are modified by the
Schedules hereto and may be modified pursuant to the provisions of Section
8(a) and
-40-
<PAGE> 41
subsection (b) below) are the only representations and warranties Noramptco and
the Stockholder have made or shall be construed to having made to Gardner
Denver in connection with the transactions contemplated by this Agreement.
Without limiting the generality of the foregoing, Gardner Denver agrees that
neither the Stockholder nor any representative thereof has made any
representation or warranty with respect to future results of operations or
future financial condition of Noramptco or any of the Noramptco Subsidiaries.
Notwithstanding anything to the contrary contained in this Agreement, it is
understood and agreed by Gardner Denver that neither Noramptco, the Stockholder
nor any other party to this Agreement is making any representation or warranty
hereunder or otherwise concerning compliance with or related to Environmental
Laws, pending or threatened proceedings related to Environmental Laws, the
disposal or release of Materials of Environmental Concern or any other
environmental matter involving Noramptco, any of the Noramptco Subsidiaries or
their respective businesses or assets, except as expressly set forth in Section
4(m) of this Agreement, provided that nothing contained in this Section 16(a)
is intended or shall be deemed to preclude the application of Section 8(a) of
this Agreement insofar as it relates to Update Notices and the related process
in respect thereto in appropriate circumstances, including any such
circumstances that may arise from environmental matters.
(b) Gardner Denver's Knowledge. Gardner Denver hereby agrees that, if
--------------------------
the Closing occurs, and Gardner Denver had knowledge prior to the Closing
that any representation or warranty of Noramptco or the Stockholder made in
this Agreement had been breached, any such representation or warranty by
Noramptco or the Stockholder shall be deemed to be amended to the extent
necessary to render it consistent with such knowledge of Gardner Denver.
-41-
<PAGE> 42
(c) Access to Information. For a period of five years from the
---------------------
Closing Date, Gardner Denver shall, during normal business hours, upon
reasonable notice and without undue interruption, provide the Stockholder and
his representatives (including, without limitation, counsel and independent
auditors), at the sole expense of the Stockholder, with full access to the
facilities of Noramptco, each of the Noramptco Subsidiaries and Lamcor and to
all information, files, documents and records (written and computer),
wherever located, relating to Noramptco, each of the Noramptco Subsidiaries
and Lamcor or any of their businesses or operations for any and all periods
through the Closing Date which the Stockholder requires with respect to any
reasonable business purpose and shall (and shall cause each of Noramptco, the
Noramptco Subsidiaries and Lamcor to) render such assistance to the
Stockholder and such representatives as they reasonably request, provided
that nothing herein shall be deemed to obligate Gardner Denver to retain
facilities of Noramptco, Noramptco Subsidiaries or Lamcor for any period
following the Closing Date.
(d) Covenant Not to Assert Claims. Gardner Denver (on behalf of
-----------------------------
itself and its affiliates) hereby covenants and agrees that it and they will
not, at any time from and after the Closing Date, assert any Environmental
Claim (as hereinafter defined) or otherwise commence any proceeding involving
an Environmental Claim against the Stockholder (or any of his affiliates) or
any other selling stockholder under this Agreement, pursuant to Environmental
Laws or otherwise, provided that this provision shall not preclude Gardner
Denver from making any claim under Section 11 of this Agreement in the event
of the intentional untruthfulness of any representation and warranty made by
Noramptco or the Stockholder in this Agreement.
For purposes hereof "Environmental Claim" means any claim by any person
or entity
-42-
<PAGE> 43
alleging actual or potential liability (including actual or potential liability
for investigatory costs, cleanup costs, governmental response costs, natural
resources damages, property damages, personal injuries or penalties) arising
out of, based on or resulting from any past, present or future (i) generation,
treatment, storage, transportation or recycling of any Materials of
Environmental Concern or presence, release, discharge, disposal or emission
into the environment of any Materials of Environmental Concern at the premises
or any former premises of Noramptco or any of the Noramptco Subsidiaries or
(ii) violation, or alleged violation, of any Environmental Laws in connection
with the business of Noramptco or any of the Noramptco Subsidiaries.
For purposes hereof "Environmental Laws" means all applicable federal,
state, local and foreign laws, rules and regulations relating to pollution or
protection of the environment (including ambient air, surface water, ground
water, land surface or subsurface strata) or the protection of human health
from environmental hazards, including laws and regulations relating to
omissions, discharges, releases or threatened releases of Materials of
Environmental Concern, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Materials of Environmental Concern.
For purposes hereof "Materials of Environmental Concern" means
chemicals, pollutants, compounds, contaminants, wastes, toxic substances,
hazardous materials, hazardous substances, petroleum and petroleum products,
in each case, which are listed under any Environmental Laws as "toxic" or
"hazardous" or potentially "toxic" or "hazardous" or with respect to which
liability or standards of conduct are imposed pursuant to any Environmental
Laws.
(e) Expenses. Subject to Section 2 hereof, each of the parties hereto
--------
shall bear his or
-43-
<PAGE> 44
its own expenses in connection with the negotiation and consummation of the
transactions contemplated by this Agreement, including, without limitation,
legal and accounting fees.
(f) Notices. All notices and other communications given or made in
-------
connection with this transaction shall be in writing and shall be delivered
personally or sent by first-class United States mail, postage prepaid, or
sent by facsimile transmission to the Stockholder at 21 A Stanhope Mews
South, London SW7 4TF, England, with a copy (which shall constitute part of
the required notice) to Haythe & Curley, 237 Park Avenue, New York, New York
10017 (facsimile no. (212) 682-0200), Attention: Thomas M. Haythe, Esq.; to
Gardner Denver at 1800 Gardner Expressway, Quincy, Illinois 62301 (facsimile
No.: 217/228-8260), Attention: Ross Centanni; to Noramptco at 1 Lamson
Street, Syracuse, New York 13206; and to all other stockholders of Lamson
Europe S.A. at the respective addresses last appearing in the stock records
of such entity.
(g) Entire Agreement. This Agreement, together with the related
----------------
schedules and exhibits and the agreements dated September 18, 1995 among
Gardner Denver, Noramptco and Roy F. Weston, Inc., constitutes the entire
agreement among the parties with respect to the subject matter of this
Agreement and shall not be modified except by an instrument in writing
executed by the parties hereto. Nothing in this Agreement is intended to
confer upon any other person or entity, including without limitation any
employees of Noramptco, any Noramptco Subsidiary or Lamcor, any rights or
remedies under or by reason of this Agreement.
(h) Counterparts. This Agreement may be executed in more than one
------------
counterpart (including by telecopy), each of which shall be deemed an
original but all of which together shall constitute one and the same
document.
-44-
<PAGE> 45
(i) Binding Effect. This Agreement shall be binding upon and inure to
--------------
the benefit of the respective parties hereto and their heirs, executors,
administrators, successors and assigns.
(j) Governing Law. The validity, interpretation and effect of this
-------------
Agreement shall be governed by the laws of the State of New York. The
invalidity or unenforceability of any provision of this Agreement shall not
affect or impair the validity or enforceability of any other provision of
this Agreement.
(k) Name. It is understood and agreed that (i) concurrently with the
----
Closing, Noramptco will amend its Certificate of Incorporation to change its
name to one which will not include "Noramptco" and (ii) the Stockholder will
retain all right, title and interest in and to the name "Noramptco," except
that Gardner Denver shall be permitted to use existing supplies of business
literature containing the "Noramptco" name for up to two years after the
Closing.
(l) Split Dollar Insurance. It is understood and agreed that, on or
----------------------
prior to September 30, 1996, at the election of the Stockholder, the
Stockholder may cancel the Split Dollar Agreements dated March 15, 1988 (as
assigned to the Stockholder by Absolute Assignment dated October 9, 1991 and
Assignment and Assumption Agreements dated October 9, 1991) in respect of
insurance policies nos. 2058248 or 2058258 on the life of the Stockholder
issued by the National Life Insurance Company of Montpelier, Vermont, all
with the effect set forth in the termination provisions, Sections VIII and
IX, respectively, of the applicable Split Dollar Agreements. In such event,
Gardner Denver agrees to cause Noramptco to promptly take the actions
specified in such Sections and to otherwise take such actions as shall be
requested by the Stockholder to effect the termination of the Split Dollar
Agreements and the release by Noramptco of the collateral assignments of the
insurance policies which are the subject thereof.
-45-
<PAGE> 46
Gardner Denver agrees to cause Noramptco not to cancel unilaterally either of
said Split Dollar Agreements prior to September 30, 1996.
(m) Termination of Employment Agreement. Notwithstanding anything to
-----------------------------------
the contrary contained in that certain Employment Agreement by and between
the Stockholder and Lamcor to be executed and delivered at the Closing
pursuant to Section 3 hereof, in addition to the provisions contained in
Section 4 of such Employment Agreement, the Stockholder specifically
acknowledges and agrees that the Employment Agreement may be terminated by
written notice by Lamcor to the Stockholder (which termination will be for
"Cause" for purposes of such Employment Agreement) if the Stockholder
violates in any material respect Sections 11, 12 or 15 of this Agreement.
-46-
<PAGE> 47
IN WITNESS WHEREOF, the parties hereto have caused this Stock Purchase
Agreement to be executed as of the date first above written.
GARDNER DENVER
MACHINERY INC.
By /s/ Ross J. Centanni /s/ Jacques Lepage
------------------------------- ----------------------------------------
Name: Ross J. Centanni Jacques Lepage
-----------------------------
Title: President & CEO
----------------------------
/s/ S. R. Lepage
----------------------------------------
Suzanne Lepage
NORAMPTCO, INC.
/s/ Anne Lepage
----------------------------------------
By /s/ Jacques Lepage Anne Lepage
--------------------------------
Name: Jacques Lepage
-----------------------------
Title: Chairman of the Board /s/ A. Lepage
---------------------------- ----------------------------------------
Arthur Lepage
-47-
