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FORM 8-K
[As last amended in Release No. 34-35113, December 19,1994, 59 F.R. 67752.]
Securities and Exchange Commission
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported): October 28, 1996
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BWAY CORPORATION
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(Exact name of registrant as specified in its charter)
DELAWARE 0-26178 36-3624491
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
8607 Roberts Drive, Suite 250
Atlanta, Georgia 30350
(Address of principal executive offices, including zip code)
770-587-0888
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
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BWAY CORPORATION
FORM 8-K
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On October 28, 1996, BWAY Corporation, a Delaware Corporation ("BWAY") acquired
through a newly created wholly-owned subsidiary, Milton Can Company, Inc.
("MCC"), a manufacturing facility in Cincinnati including a material center and
Ball Corporation's ("Ball") assets used in connection with the marketing,
distributing, selling, manufacturing, designing and engineering of metal aerosol
cans (the "Business"), from Ball Metal Food Container Corp. ("Seller"), a
wholly-owned subsidiary of Ball, pursuant to the terms of the Asset Purchase
Agreement dated as of October 6, 1996, by and among Brockway Standard (New
Jersey), Inc. ("BSNJ"), formerly known as Milton Can Company, Inc., BWAY, Seller
and Ball, as amended by Amendment No. 1 to Asset Purchase Agreement dated
October 28, 1996, in which BSNJ assigned its rights to MCC, (as amended, the
"Asset Purchase Agreement"). BWAY's participation in this transaction was
limited with respect to payment obligations only. Separately, MCC and Seller
have entered into a supply agreements whereby MCC will provide coating,
decorating, and certain metal processing services to Seller. The following
discussion is only a summary and is qualified in its entirety by reference to
the Exhibits to this Current Report on Form 8-K.
Pursuant to the Asset Purchase Agreement, MCC acquired from Seller, the
Cincinnati facility which includes a material center and substantially all of
Ball's assets used in connection with the marketing, distributing, selling,
manufacturing, designing and engineering of metal aerosol cans. In addition,
MCC has assumed certain of the liabilities of the Business. BWAY intends to
continue using the assets acquired for the manufacturing of aerosol containers
and providing metal coating and decorating services.
The purchase price was approximately $40 million. At closing BWAY paid Ball
consideration of approximately $36 million which was comprised of $33 million in
cash, $3 million in notes. An additional $4 million was held by BWAY and will be
paid subject to a purchase price adjustment based on a complete review of the
Business' current assets and liabilities as of the closing date. The amount of
consideration was determined as a result of negotiations between BWAY and the
Seller. The source of funds for the acquisition was additional borrowings under
BWAY's Credit Agreement, dated June 17, 1996, among Bankers Trust Company,
NationsBank, N.A., BWAY, BSNJ, formerly known as Milton Can Company, Inc. and
Brockway Standard, Inc. The transaction will be recorded using the purchase
method of accounting.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial statements of businesses acquired.
Effective November 18, 1996, the Commission has adopted an amendment
to Rule 3-05 regarding disclosure rules for significant business
acquisitions. Pursuant to Release No. 33-7355 and the related changes
with regard to the thresholds of significance, the filing of audited
financial statements will not be required.
(b) Pro forma financial information.
Effective November 18, 1996, the Commission has adopted an amendment
to Rule 3-05 regarding disclosure rules for significant business
acquisitions. Pursuant to Release No. 33-7355 and the related changes
with regard to the thresholds of significance,
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the filing of pro forma financial information will not be required.
(c) Exhibits
(1) The exhibits listed in the Index to Exhibits.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
BWAY Corporation
(Registrant)
Date: November 11, 1996 By: /s/ David P. Hayford
_______________________
David P. Hayford
Senior Vice President &
Chief Financial Officer
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INDEX TO EXHIBITS
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EXHIBIT
NO. DESCRIPTION OF DOCUMENT
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10.1 Asset Purchase Agreement dated October 6, 1996,
between Brockway Standard (New Jersey), Inc. formerly
known as Milton Can Company, Inc., BWAY Corporation,
Ball Metal Food Container Corp. and Ball Corporation
10.2 Amendment No. 1 to the Asset Purchase Agreement
dated October 28, 1996.
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ASSET PURCHASE AGREEMENT
between
MILTON CAN COMPANY, INC.,
BWAY CORPORATION
(WITH RESPECT TO PAYMENT OBLIGATIONS HEREUNDER ONLY)
BALL METAL FOOD CONTAINER CORP.
and
BALL CORPORATION
October 6, 1996
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TABLE OF CONTENTS
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Page
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ARTICLE I
CERTAIN DEFINITIONS................................................. 1
ARTICLE II
PURCHASE AND SALE OF PURCHASED ASSETS.............................. 9
2.1 Purchase and Sale of Purchased Assets......................... 9
2.2 Excluded Assets............................................... 10
2.3 Assumed Liabilities........................................... 11
2.4 Retained Liabilities.......................................... 11
2.5 Purchase Price................................................ 13
2.6 Purchase Price Adjustment..................................... 14
2.7 Prorations.................................................... 15
2.8 Nonassignable Contracts....................................... 15
ARTICLE III
THE CLOSING........................................................ 16
3.1 Time and Place of Closing..................................... 16
3.2 Deliveries by Seller.......................................... 16
3.3 Deliveries by Purchaser....................................... 17
ARTICLE IV
CONDITIONS TO SELLER'S OBLIGATIONS................................. 17
4.1 Representations, Warranties and Covenants..................... 17
4.2 No Injunction................................................. 18
4.3 Collective Bargaining Agreements.............................. 18
4.4 Hart-Scott-Rodino Act......................................... 18
4.5 Opinion of Counsel............................................ 18
4.6 Materials Supply Agreement.................................... 18
4.7 Food Can Tolling Agreements................................... 18
4.8 Certificates, Agreements and Other Documents.................. 18
ARTICLE V
CONDITIONS TO PURCHASER'S OBLIGATIONS.............................. 19
5.1 Representations, Warranties and Covenants..................... 19
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5.2 Consents and Approvals........................................ 19
5.3 No Litigation................................................. 19
5.4 Opinion of Counsel............................................ 19
5.5 Hart-Scott-Rodino Act......................................... 20
5.6 Transition Services........................................... 20
5.7 Materials Supply Agreement; Food Can Tolling Agreements....... 20
5.8 Title Insurance and Survey.................................... 20
5.9 No Material Adverse Change.................................... 21
5.10 Lien Searches................................................. 21
5.11 Certificates, Agreements and Other Documents.................. 21
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF SELLER AND BALL.................. 21
6.1 Due Incorporation, Etc........................................ 21
6.2 Subsidiaries.................................................. 22
6.3 Authorization, No Conflicts, Etc.............................. 22
6.4 Consents and Approvals........................................ 22
6.5 Absence of Violations......................................... 22
6.6 Licenses and Permits.......................................... 23
6.7 Books, Records and Forecasts.................................. 23
6.8 Financial Statements.......................................... 23
6.9 Absence of Undisclosed Liabilities............................ 24
6.10 No Material Adverse Change.................................... 24
6.11 Absence of Certain Developments............................... 24
6.12 Customers and Agents.......................................... 25
6.13 Insurance..................................................... 25
6.14 Material Contracts............................................ 25
6.15 Assets........................................................ 26
6.16 Real Properties............................................... 26
6.17 Tangible Personal Property.................................... 28
6.18 Proprietary Rights............................................ 28
6.19 Litigation.................................................... 29
6.20 Product Warranty.............................................. 29
6.21 Environmental and Safety Matters.............................. 29
6.22 Indebtedness.................................................. 31
6.23 Brokers....................................................... 31
6.24 Intercompany Services......................................... 31
ARTICLE VII
REPRESENTATIONS AND WARRANTIES OF PURCHASER........................ 31
7.1 Due Incorporation, Etc........................................ 31
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7.2 Authorization, No Conflicts, Etc.............................. 31
7.3 Consents and Approvals........................................ 32
7.4 Absence of Violations......................................... 32
7.5 Legal Proceedings............................................. 32
7.6 Financial Ability to Perform.................................. 32
7.7 Brokers....................................................... 32
ARTICLE VIII
COVENANTS PRIOR TO CLOSING......................................... 32
8.1 Affirmative Covenants of Seller............................... 32
8.2 Negative Covenants of Seller.................................. 34
8.3 Exclusivity................................................... 35
8.4 Investigation by Purchaser and Confidentiality................ 35
8.5 Further Actions............................................... 36
8.6 Hart-Scott-Rodino Act......................................... 36
ARTICLE IX
COVENANTS AFTER CLOSING............................................ 37
9.1 Survival of Representations and Warranties.................... 37
9.2 General Indemnification....................................... 37
9.3 Environmental Indemnification................................. 40
9.4 Exclusive Remedy.............................................. 44
9.5 Liability for Taxes........................................... 44
9.6 Non-Compete................................................... 44
9.7 Further Transfers............................................. 44
9.8 Certain Tax Matters........................................... 44
9.9 Regulatory Compliance Cooperation............................. 45
9.10 Collection of Closing Accounts Receivable..................... 45
9.11 Sale of Inventory............................................. 46
9.12 Audit......................................................... 47
ARTICLE X
EMPLOYEE MATTERS................................................... 47
10.1 Representation With Respect to Employees...................... 47
10.2 Representation With Respect to ERISA.......................... 48
10.3 Pension Plans................................................. 49
10.4 Assumption of Collective Bargaining Agreement................. 50
10.5 Salaried Employees............................................ 51
10.6 Laid-Off Employees............................................ 51
10.7 Employment-Related Pro Ration................................. 51
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10.8 Additional Covenants.......................................... 52
10.9 No Third Party Beneficiary Rights............................. 53
ARTICLE XI
MISCELLANEOUS....................................................... 53
11.1 Termination................................................... 53
11.2 Condition of Assets........................................... 54
11.3 Survival of Covenants and Agreements.......................... 54
11.4 Equitable Remedies............................................ 54
11.5 Assignment.................................................... 55
11.6 Notices....................................................... 55
11.7 Expenses...................................................... 57
11.8 Public Announcements.......................................... 57
11.9 Entire Agreement.............................................. 57
11.10 Waiver........................................................ 57
11.11 Amendment..................................................... 57
11.12 Counterparts.................................................. 57
11.13 Invalid Provisions............................................ 57
11.14 Headings, Gender, Etc......................................... 57
11.15 CHOICE OF LAW................................................. 58
11.16 No Third-Party Beneficiaries.................................. 58
11.17 BWAY Obligations.............................................. 58
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ASSET PURCHASE AGREEMENT
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THIS ASSET PURCHASE AGREEMENT ("Agreement"), dated as of October 6,
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1996, is made and entered into by and between Ball Metal Food Container Corp., a
Delaware corporation ("Seller"), Ball Corporation, an Indiana corporation
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("Ball"), Milton Can Company, Inc., a Delaware corporation or its designee (the
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"Purchaser") and, with respect to payment obligations hereunder only, BWAY
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Corporation, a Delaware corporation ("BWAY").
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Purchaser desires to purchase, and Seller and Ball desire to sell, all
of the assets located at the Owned Real Property (other than certain assets
associated with the sanitary food business, as discussed below) and the other
Purchased Assets used by Seller (or any of its subsidiaries or Affiliates) in
connection with the marketing, distributing, selling, manufacturing, designing
and engineering of metal aerosol cans (the "Business"), upon the terms and
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subject to the conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein and in reliance upon the representations and
warranties contained herein, the parties hereto covenant and agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
As used in this Agreement, the following terms shall have the
following designated meanings:
"Accounting Firm" has the meaning set forth in Section 2.6(b).
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"Additional Post-Retirement Liabilities" has the meaning set forth in
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Section 10.4(d).
"Affiliate" of another Person shall mean any Person that directly, or
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indirectly through one or more intermediaries, controls or is controlled by or
is under common control with such other Person.
"Agreement" has the meaning set forth in the Recitals.
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"Assumed Contracts" has the meaning set forth in Section 2.1(f).
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"Assumed Liabilities" has the meaning set forth in Section 2.3.
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"Audit" means an accounting audit of the balance sheet and related
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statement of income, retained earnings, and changes in financial position for
the applicable period prepared in accordance with GAAP and generally accepted
auditing procedures.
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"August Balance Sheet" has the meaning set forth in Section 6.8(a).
--------------------
"Ball" has the meaning set forth in the Recitals.
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"Ball Pension Plan" has the meaning set forth in Section 10.3.
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"Books and Records" means those books, records and documents attached
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to the Books and Records Schedule attached hereto.
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"Budgets and Forecasts" means those operating plans, budgets and
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forecasts attached to the Budgets and Forecasts Schedule attached hereto.
------------------------------
"Business" has the meaning set forth in the Recitals.
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"BWAY" has the meaning set forth in the recitals.
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"Capital Expenditure Amount" means the amount Seller actually spends
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until 12:01 a.m. on the Closing Date on (i) the aerosol bottom multipress
upgrade approved by Purchaser (which amount may not exceed $1,035,400) and (ii)
any other capital expenditures the budget for which Purchaser approves in
writing in advance.
"Cash Purchase Price" has the meaning set forth in Section 2.5.
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"CERCLA" means the Comprehensive Environmental Response, Compensation
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and Liability Act of 1980, as amended.
"Closing" has the meaning set forth in Section 3.1.
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"Closing Accounts Receivables" has the meaning set forth in
----------------------------
Section 9.10.
"Closing Date" has the meaning set forth in Section 3.1.
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"Closing Inventory" has the meaning set forth in Section 9.11.
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"Closing Payment" has the meaning set forth in Section 2.5.
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"Collective Bargaining Agreements" means the agreements, side
--------------------------------
agreements, side letters, memoranda of agreement or binding employment practices
or policies to the extent the terms thereof are described in detail on, or
attached to, the Collective Bargaining Agreements Schedule attached hereto,
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between (i) Ball Metal Food Container Corp., Cincinnati Plant and The United
Steelworkers of America, AFL-CIO (Local Union No. 4372), effective May 1, 1996
through April 30, 2000; (ii) Metal Food Container and Specialty Products Group,
Heekin Can, Inc., Cincinnati, Ohio, Ancor Plant and The International Union of
Electronic, Electrical, Salaried, Machine and Furniture Workers, AFL-CIO (Local
No. 729), effective May 1, 1994 through April 30, 1997; and (iii) Metal Food
Container and Specialty Products Group, Heekin Can, Inc., Cincinnati Plant and
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International Association of Machinist and Aerospace Workers (Local No. 162),
effective May 1, 1994 through April 30, 1998.
"Contracts" has the meaning set forth in Section 2.8.
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"Controlled Group" means all members of a controlled group of
----------------
corporations and all members of a controlled group of trades or businesses
(whether or not incorporated) under common control which, together with Seller,
as the case may be, are treated as a single employer under Section 414(b) or
414(c) of the IRC or Section 4001 of ERISA.
"Current Assets" means (i) the Purchased Assets which are current
--------------
assets under GAAP, including all trade accounts receivable, inventory, deposits
and advances and all prepaid expenses and miscellaneous (non-trade) receivables
as of 12:01 a.m. on the Closing Date and (ii) items subject to proration that
have been paid by Seller on behalf of Purchaser and for which Purchaser must
reimburse Seller pursuant to Section 2.7.
"Current Liabilities" means (i) the Assumed Liabilities which are
-------------------
current liabilities under GAAP, including all deposits, advances and prepayments
made by any customer of the Business, and accrued quantity discounts (which
accrual shall in any case account for additional levels of quantity discounts
anticipated for sales of the Business from the Closing Date through until the
end of the respective discount determination periods) for customers of the
Business, but excluding all Retained Liabilities (including without limitation
accounts payable), in each case as of 12:01 on the Closing Date, and (ii) items
subject to proration that have been or will be paid by Purchaser on behalf of
Seller, and for which Seller must reimburse Purchaser pursuant to Section 2.7.
The parties acknowledge and agree that for purposes of preparing the Statement
of Adjustments only "Current Liabilities" shall not include any liability
required by FASB 106.
"Employee" means each active employee, former employee, employee on
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any leave of absence, including but not limited to military or
maternity/paternity leave or Family Medical Leave Act leave, employee on short-
or long-term disability, sick leave, employee on layoff, employee on workers'
compensation, or retiree, in each case with respect to the Business, or any
beneficiary or any of the foregoing.
"Employee List" has the meaning set forth in Section 10.1(a).
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"Environmental and Safety Requirements" means all applicable federal,
-------------------------------------
state and local statutes, regulations, ordinances and other provisions having
the force or effect of law, all applicable judicial and administrative orders
and determinations and all applicable contractual obligations and all applicable
common law, in each case concerning public health and safety, worker health and
safety and pollution or protection of the environment (including, without
limitation, all those relating to the presence, use, production, generation,
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handling, transportation, treatment, storage, disposal, distribution, labeling,
testing, processing, discharge, Release, threatened Release, control or cleanup
of any Hazardous Materials, substances or wastes, chemical substances or
mixtures, pesticides, pollutants, contaminants, toxic chemicals, petroleum
products or byproducts, asbestos, polychlorinated biphenyls, noise or
radiation).
"Environmental Lien" means any Lien, whether recorded or unrecorded,
------------------
in favor of any Government Entity, relating to any liability of Seller or any of
its Subsidiaries arising under any Environmental and Safety Requirements.
"ERISA" means the Employee Retirement Income Security Act of 1974 (or
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any successor legislation thereto), as amended from time to time and any
regulations promulgated thereunder.
"Excluded Assets" has the meaning set forth in Section 2.2.
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"GAAP" means generally accepted accounting principles in the United
----
States as in effect on the date hereof, consistently applied.
"Guaranty" has the meaning set forth in Section 4.6.
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"Government Entity" means the United States of America or any other
-----------------
nation, any state, province or other political subdivision thereof, or any
entity exercising executive, legislative, judicial, regulatory or administrative
functions of government, including any tribunal.
"Hart-Scott-Rodino Act" means the Hart-Scott-Rodino Antitrust
---------------------
Improvements Act of 1976, as amended.
"Hazardous Materials" means any hazardous, toxic, dangerous or other
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waste, substance or material defined as such in or regulated by any
environmental, public health and safety or worker health and safety law.
"IAM Employees" has the meaning set forth in Section 10.3.
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"Improvements" has the meaning set forth in Section 6.16(d).
------------
"Indemnitee" has the meaning set forth in Section 9.2(d).
----------
"Indemnitor" has the meaning set forth in Section 9.2(d).
----------
"Indemnity Payment" has the meaning set forth in Section 9.2(f).
-----------------
"Inventory" has the meaning set forth in Section 2.1(b).
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"IRC" means the Internal Revenue Code of 1986, as amended, and any
---
reference to any particular IRC section shall be interpreted to include any
revision of or successor to that section regardless of how numbered or
classified.
"IUE Employees" has the meaning set forth in Section 10.3.
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"Laid-Off Employees" means the employees listed on the Laid-Off
------------------ --------
Employees Schedule attached hereto.
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"Laws" means all statutes, laws, ordinances, regulations, rules,
----
orders, judgments, writs, injunctions, acts or decrees of any Government Entity.
"Long-Term Disabled Employees" means the Employees listed on the Long-
---------------------------- ----
Term Disabled Employees Schedule attached hereto.
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"Losses" has the meaning set forth in Section 9.2(a).
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"Material Contracts" has the meaning set forth in Section 6.14(a).
------------------
"Materials Supply Agreement" has the meaning set forth in Section 4.7.
--------------------------
"Multiemployer Plan" means a "multiemployer plan" as defined in
------------------
Section 4001(a)(3) of ERISA, and to which any Person or any member of such
Person's Controlled Group is making, is obligated to make, has made or been
obligated to make, contributions on behalf of participants who are or were
employed by any of them.
"Note" means that certain note to be issued by Purchaser in favor of
----
Seller at Closing, in the initial principal amount of $3,000,000, with a 6.0%
annual percentage rate and with maturity of principal on December 31, 2000. It
being understood that (i) the terms of the Note will provide Purchaser the
option of repaying the Note any time after the 18 month anniversary of Closing
by returning to Seller the three coating lines numbered five, six and eight
included in the Purchased Assets and (ii) the cost of removing and relocating
such machines shall be paid by Seller.
"Notice of Disagreement" has the meaning set forth in Section 2.6(b).
----------------------
"Owned Real Property" means all of Seller's land and all buildings,
-------------------
fixtures and other improvements located at 8200 Broadwell Road, Anderson
Township, Hamilton County, Ohio (other than the assets on the Excluded Assets
Schedule) including, without limitation, all electrical, mechanical, plumbing
and other building systems, security and surveillance systems and
telecommunications, computer (other than software), wiring and cable
installations located thereon, and all beneficial easements, rights of way,
tenements, hereditaments, appurtenances, privileges and other beneficial rights
with respect thereto owned by or belonging to Seller.
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"PBGC" means the Pension Benefit Guaranty Corporation or any successor
----
thereto.
"Pension Funding Amount" has the meaning set forth in Section 10.3(a).
----------------------
"Pension Plan" means a "pension plan", as such term is defined in
------------
Section 3(2) of ERISA, which is subject to Title IV of ERISA (other than a
multiemployer plan as defined in Section 4001(a)(3) of ERISA), and to which
Seller or any corporation, trade or business that is, along with Seller, a
member of a Controlled Group, may have liability, including any liability by
reason of having been a substantial employer within the meaning of Section 4063
of ERISA at any time during the preceding five years, or by reason of being
deemed to be a contributing sponsor under Section 4069 of ERISA.
"Permits" has the meaning set forth in Section 2.1(c).
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"Permitted Encumbrances" has the meaning set forth in Section 6.16.
----------------------
"Permitted Liens" has the meaning set forth in Section 6.17
---------------
"Person" means an individual, a partnership, a corporation, a limited
------
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization or a Government Entity or any
department, agency or political subdivision thereof.
"Personal Property" has the meaning set forth in Section 2.1(a).
-----------------
"Personal Property Leases" has the meaning set forth in
------------------------
Section 2.1(e).
"Personal Property Liens" has the meaning given such term in
-----------------------
Section 6.17.
"Plan" means, with respect to any Person or any member of its
----
Controlled Group, an employee benefit plan, as defined in Section 3(3) of ERISA,
which any Person or any of its Subsidiaries maintains, contributes to or has an
obligation to contribute to on behalf of participants who are or were employed
by any of them.
"Post-Retirement Liabilities" has the meaning set forth in
---------------------------
Section 10.4(d).
"Proprietary Rights" has the meaning set forth in Section 6.18.
------------------
"Purchase Price" has the meaning set forth in Section 2.5.
--------------
"Purchase Price Adjustment" means the amount determined pursuant to
-------------------------
Section 2.6(d) to be payable by Purchaser to Seller or Seller to Purchaser, as
the case may be.
"Purchased Assets" has the meaning set forth in Section 2.1 hereof.
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"Purchaser" has the meaning set forth in the Recitals.
---------
"Purchaser Parties" has the meaning set forth in Section 9.2(a).
-----------------
"Qualified Plan" means an employee pension benefit plan, as defined in
--------------
Section 3(2) of ERISA, which is intended to be tax-qualified under Section
401(a) of the IRC, and which Seller, any of its Subsidiaries or any member of
its Controlled Group maintains, contributes to or has an obligation to
contribute to on behalf of participants who are or were employed by any of them.
"Real Property Laws" has the meaning set forth in Section 6.16(f).
------------------
"Real Property Permits" has the meaning set forth in Section 6.16(e).
---------------------
"Reimbursable Cost" means the net cost consisting of (i) actual claims
-----------------
paid under the Seller's self-funded health and dental plans for claims incurred
from the Closing Date through December 31, 1996 (the "Reimbursable Period"),
-------------------
plus (ii) premiums for coverage under the Seller's fully-insured health plans
- ----
and HMOs during the Reimbursable Period, plus (iii) premiums for coverage under
----
the Seller's fully-insured plans which provide group life and accidental death
and dismemberment benefits during the Reimbursable Period, less (iv) pre-tax
contributions made by, and credits applicable to, Transferred Employees for
coverage referred to in (i), (ii), and (iii) above.
"Release" has the meaning set forth in CERCLA.
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"Retained Liabilities" has the meaning set forth in Section 2.4.
--------------------
"Salaried Employees" means the employees listed on the Salaried
------------------ --------
Employees Schedule.
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"Seller" has the meaning set forth in the Recitals.
------
"Seller Parties" has the meaning set forth in Section 9.2(b).
--------------
"Sick Pay Employees" means the employees listed under the "Sick Leave"
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heading on the Sick Pay Employees Schedule attached hereto.
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"Statement of Adjustments" means the statement prepared by Seller
------------------------
setting forth the Current Assets, the Current Liabilities and the Capital
Expenditure Amount as of the Closing Date and Seller's good faith determination
of the Purchase Price Adjustment.
"Subsidiary" means, with respect to any Person, any corporation,
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partnership, association or other business entity of which (i) if a corporation,
a majority of the total voting power of shares of stock entitled (irrespective
of whether, at the time, stock of any other class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency) to vote in the election of directors, managers or trustees thereof
is at the time owned or controlled, directly or indirectly, by that Person or
one or more of the other Subsidiaries of that Person or a combination thereof,
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or (ii) if a partnership, association or other business entity, a majority of
the partnership or other similar ownership interest thereof is at the time owned
or controlled, directly or indirectly, by any Person or one or more Subsidiaries
of that Person or a combination thereof. For purposes hereof, a Person or
Persons shall be deemed to have a majority ownership interest in a partnership,
association or other business entity if such Person or Persons shall be
allocated a majority of partnership, association or other business entity gains
or losses or shall be or control the managing director or general partner of
such partnership, association or other business entity.
"Survey" has the meaning set forth in Section 5.8(c).
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"Tax" means any federal, state, local or foreign income, gross
---
receipts, capital stock, franchise, profits, withholding, social security,
unemployment, disability, real property, personal property, stamp, excise,
occupation, sales, use, transfer, value added, alternative minimum, estimated or
other tax, including any interest, penalty or addition thereto, whether disputed
or not.
"Third Party Claim" has the meaning set forth in Section 9.3(c).
-----------------
"Title Commitment" has the meaning set forth in Section 5.8(a).
----------------
"Title Insurance Company" has the meaning set forth in Section 5.8(a).
-----------------------
"Title Insurance Policy" has the meaning set forth in Section 5.8(b).
----------------------
"Top Customers" has the meaning set forth in Section 6.12.
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"Transferred Employee" means each (i) salaried Employee who becomes
--------------------
an active Employees with the Purchaser on or after the Closing Date, (ii)
Employee (other than any Laid-Off Employee) who is covered under one of the
Collective Bargaining Agreements, and (iii) former Employee who has seniority
reemployment recall rights under the Collective Bargaining Agreements and who
commences active employment with Purchaser on or after the Closing Date.
"Transition Services Agreement" has the meaning set forth in
-----------------------------
Section 5.6.
"USWA Employees" has the meaning set forth in Section 10.3.
--------------
"Vehicles" has the meaning set forth in Section 2.1(i).
--------
"WARN Act" has the meaning set forth in Section 2.3(c).
--------
-8-
<PAGE>
"Withdrawal Liability" means, at any time, the aggregate amount of the
--------------------
liabilities, if any, pursuant to Section 4021 of ERISA, and any increase in
contributions pursuant to Section 4243 of ERISA with respect to all
Multiemployer Plans.
Any accounting term used in this Agreement shall have, unless
otherwise specifically provided herein, the meaning customarily given such term
in accordance with GAAP, and all financial computations hereunder shall be
computed, unless otherwise specifically provided herein, in accordance with GAAP
consistently applied. That certain terms or computations are explicitly
modified by the phrase "in accordance with GAAP" shall in no way be construed to
limit the foregoing.
ARTICLE II
PURCHASE AND SALE OF PURCHASED ASSETS
2.1 Purchase and Sale of Purchased Assets. In exchange for the
-------------------------------------
consideration specified in Section 2.5 hereof, and upon the terms and subject to
the conditions provided for in this Agreement, on the Closing Date, Seller and
any Affiliate that owns any of the Purchased Assets will irrevocably sell,
transfer, assign, convey and deliver to Purchaser, and Purchaser will purchase
from Seller and any such Affiliate, free and clear of all liens, charges and
encumbrances of whatever nature, all of Seller's and such Affiliate's right,
title and interest in and to the Owned Real Property (which may be subject to
the Permitted Encumbrances) and all other tangible and intangible assets owned,
leased or held by Seller or any such Affiliate (x) located on or at the Owned
Real Property (other than those assets specifically set forth on the Excluded
--------
Assets Schedule attached hereto), and (y) located off the Owned Real Property
- ---------------
and listed on the Other Assets Schedule attached hereto (collectively referred
---------------------
to herein as the "Purchased Assets"). The Purchased Assets shall include,
----------------
without limitation, the following assets relating to the Business, other than
those assets set forth in detail on the Excluded Assets Schedule, that satisfy
------------------------
the description of the foregoing sentence:
(a) All machinery, equipment, tooling, parts, molds, dies, furniture,
stores, office supplies, vehicles, testing equipment and office equipment,
production supplies and other supplies, computer equipment (including all
hardware, personal computer software and terminals) spare parts and other
tangible personal property of any kind (the "Personal Property") and all
-----------------
warranties and guarantees of such Personal Property;
(b) All raw materials, component parts, stores, direct materials,
packaging materials, work-in-process and finished goods inventory, stores
inventory, consigned goods and other inventory (including warehoused
inventories) as of 12:01 a.m. on the Closing Date (the "Inventory");
---------
-9-
<PAGE>
(c) The permits, franchises, licenses, consents, authorizations,
approvals and certificates of any regulatory, administrative or other
governmental agency or body (to the extent the same are transferable) listed on
the Permits Schedule (the "Permits");
---------------- -------
(d) All patents and pending patent applications, inventions,
engineering, research, prototypes, processes, trade secrets, confidential
information, proprietary knowledge, know-how, trademarks, service marks, trade
names, copyrights, personal computer software, copyrightable works and other
proprietary rights, whether or not patented or registered, that are owned or
licensed by the Seller (including the Proprietary Rights);
(e) All of Seller's rights in the equipment, machinery, vehicles or
other tangible personal property listed on the Personal Property Schedule and
--------------------------
covered by leases or licenses included in the Contracts (the "Personal Property
-----------------
Leases") and all warranties and guarantees of such Personal Property;
- ------
(f) The contracts, agreements, executory commitments, instruments,
arrangements and understandings, whether oral or written, listed or described on
the Contracts Schedule to the extent specifically agreed to be assumed by
------------------
Purchaser and so indicated on such Schedule, and all outstanding purchase and
sales orders entered into before or after the date hereof in the ordinary course
of the Business (provided that purchase and sale orders with Affiliates of
Seller will only be included to the extent (i) the terms and conditions thereof
are no less favorable to Seller than those generally obtainable in the market
for such products, (ii) the terms and conditions are described on the Contracts
---------
Schedule, and (iii) such order is specifically agreed to be assumed by Purchaser
- --------
and so indicated on such Schedule) (collectively, the "Assumed Contracts");
-----------------
(g) All trade accounts receivable of Seller;
(h) All deposits, advances and prepaid expenses of Seller;
(i) All the automobiles, trucks and other vehicles and all related
certificates of title properly endorsed by Seller to Purchaser, including,
without limitation, those described on the Vehicles Schedule (the "Vehicles");
----------------- --------
(j) All lists, records and other information pertaining to accounts,
referral sources, suppliers and customers; and all studies, annual plans, books,
ledgers, files and business records of every kind (including all financial,
business and marketing plans and information); in each case whether evidenced in
writing, electronic data (including by computer) or otherwise;
(k) All telephone, telex and telecopy numbers for the Owned Real
Property and all right to receive and retain mail and other communication
relating to the Business;
-10-
<PAGE>
(l) All claims, causes of action, rights of recovery and rights of
set-off of any kind relating to the Purchased Assets (other than those related
to the Excluded Assets); and
(m) All goodwill as a going concern; and
(n) All advertising, marketing and promotional materials, all archival
materials and all other printed or written materials.
In the event that any Purchased Assets are owned by Affiliates of
Seller, Ball shall cause such assets to be conveyed to Purchaser.
2.2 Excluded Assets. Notwithstanding the foregoing, the following
---------------
properties, assets and rights (the "Excluded Assets") are expressly excluded
---------------
from the purchase and sale contemplated hereby and, as such, are not included in
the Purchased Assets:
(a) all cash on hand at 12:01 a.m. on the Closing Date;
(b) tax returns and supporting schedules, documents and records;
(c) Seller's rights under or pursuant to this Agreement and the
Schedules and Exhibits attached hereto;
(d) all assets, rights or properties relating exclusively to Seller's
sanitary food can business; and
(e) all other assets and properties of Seller specifically listed or
described on the Excluded Assets Schedule.
------------------------
2.3 Assumed Liabilities. Purchaser shall not assume any liabilities
-------------------
of Seller, Ball or the Business except to the extent specifically set forth
below. Subject to the conditions set forth in this Agreement and as additional
consideration for the Purchased Assets, Purchaser shall assume as of the Closing
only the following liabilities and obligations of Seller (collectively, the
"Assumed Liabilities"):
- --------------------
(a) all liabilities and obligations arising under the Assumed
Contracts (other than the Collective Bargaining Agreements), to the extent
that such liabilities and obligations arise or are required to be performed
on or after the Closing Date; provided that Purchaser shall not assume any
liabilities or obligations under Assumed Contracts to the extent relating
to Seller's performance prior to the Closing or for any breach thereunder
existing prior to the Closing (or any status, fact, circumstance or
condition existing on the Closing Date that, with the giving of notice or
the passage of time period specified in such Assumed Contract, would
constitute a breach thereunder);
-11-
<PAGE>
(b) all deposits, advances and prepayments made by customers of the
Business prior to the Closing Date;
(c) all liabilities and obligations of the Business to the extent
caused by or resulting from Purchaser's ownership or operation of the Business
after the Closing or otherwise arising after the Closing, including but not
limited to any obligation under the Consolidated Omnibus Budget Reconciliation
Act of 1985, or to give notice or other liabilities arising under the Worker
Adjustment Retraining Notification Act of 1988, as amended, (the "WARN Act") or
--------
similar advance notice state or local law, arising out of the termination of, or
failure to hire, Employees of the Business by Purchaser on or after the Closing
Date or failure by Purchaser to offer employment to any Employee in accordance
with this Agreement; and
(d) those obligations and liabilities (including under the Collective
Bargaining Agreements) that are specifically assumed, or that Purchaser agrees
to be responsible for, pursuant to the terms of Article X.
2.4 Retained Liabilities. Except as otherwise expressly specified
--------------------
herein, Purchaser shall not assume or in any way become liable for any of
Seller's, Ball's or any of their respective affiliates' or predecessors' debts,
liabilities or obligations of any nature whatsoever other than the Assumed
Liabilities, whether accrued, absolute, contingent or otherwise, whether known
or unknown, whether due or to become due on or after the Closing, whether
related to the Business or the Purchased Assets and whether disclosed on the
Schedules attached hereto, and regardless of when or by whom asserted, to the
extent relating to, caused by or resulting from Seller's, Ball's or any of their
respective predecessors' or affiliates' ownership or operation of the Business
(collectively, the "Retained Liabilities"), including, without limitation:
--------------------
(a) any and all of Seller's or Ball's liabilities or obligations under
this Agreement and the Schedules and Exhibits attached hereto;
(b) any and all of Seller's or Ball's liabilities or obligations for
expenses or fees incident to or arising out of the negotiation, preparation,
approval or authorization of this Agreement or the consummation (or preparation
for the consummation) of the transactions contemplated hereby (including all
attorneys' and brokerage fees);
(c) any and all liability or obligation for trade payables associated
with the Business arising as a result of products or services received prior to
the Closing Date;
(d) any and all liability or obligation of Seller or Ball for Taxes,
including any liability or obligation of Seller or Ball in respect of any amount
of federal, state or other Taxes (including any liabilities relating to Taxes
arising as a result of Seller or Ball at any time being a member of an
affiliated group (as defined in Section 1504(a) of the IRC)) which are imposed
on or measured by the income or operations of Seller for any period;
-12-
<PAGE>
(e) any and all liabilities or obligations arising under any
Environmental and Safety Requirements with respect to (i) any business of
Seller, Ball or their respective predecessors or affiliates other than the
Business; or (ii) any facility or property owned or operated at any time by
Seller or any predecessor or affiliate of Seller in connection with the Business
other than the Owned Real Property;
(f) any and all liabilities or obligations arising out of or relating
to the offsite treatment, storage, disposal, arrangement for disposal, or other
disposition of any solid, hazardous or other waste generated or produced in
connection with the operation of the Business on or prior to the Closing by
Seller, Ball or their respective predecessors or affiliates, including, without
limitation, any liabilities arising under CERCLA with respect thereto (except
for any waste generated in the ordinary course by Seller prior to the Closing
Date that is located at the Owned Real Property that Purchaser disposes of in
violation of Environmental and Safety Requirements);
(g) any and all liabilities or obligations with respect to any
products finally assembled on or prior to the Closing, including for returned
products, product liability, product warranties, and/or infringement claims and
any related claims for offset against Purchaser's accounts receivables relating
to sales after the Closing and any legal action, proceeding or claim arising
prior to, on or after the Closing with respect to the foregoing (other than
ordinary course expenses Seller pays for, and damage to or loss of such product
Seller causes in the course of, storing, handling and distributing such products
included in the Inventory);
(h) any and all payments, obligations and liabilities with respect to
Employees, except for those payments, obligations and liabilities with respect
to Employees specifically assumed by Purchaser, or that Purchaser agrees to be
responsible for, pursuant to Article X hereof;
(i) any and all liabilities or obligations, wherever arising, relating
to any legal action, proceeding or claim to the extent arising out of or in
connection with the ownership, or operation of the Business or the Purchased
Assets by Seller or its predecessors or any other conduct of Seller, Seller's
officers, directors, employees, consultants, agents or advisors on or prior to
the Closing;
(j) any and all of Seller's liabilities or obligations for
indebtedness for borrowed money or indebtedness secured by liens on its assets
or guarantees of any of the foregoing;
(k) any and all liabilities or obligations relating to any of the
Excluded Assets (including, without limitation, under any contracts, leases,
commitments or understandings related thereto); and
-13-
<PAGE>
(l) any and all other liabilities or obligations of Seller not
expressly assumed by Purchaser pursuant to Section 2.3 above.
2.5 Purchase Price.
--------------
(a) The aggregate purchase price for the Purchased Assets shall be
$40,000,000 (subject to adjustment), of which $36,000,000 shall be paid at
Closing (the "Closing Payment"), as follows: $33,000,000 shall be paid by
---------------
Purchaser at Closing in immediately available funds (the "Cash Purchase Price"),
-------------------
$3,000,000 shall be paid by Purchaser in the form of the Note and the remaining
amount (if any) shall be paid pursuant to the Purchase Price Adjustment as
determined pursuant to Section 2.6 below (the Closing Payment and the Purchase
Price Adjustment collectively referred to as the "Purchase Price").
--------------
(b) At Closing, Purchaser shall pay the Closing Payment by wire
transfer of immediately available funds to an account designated by Seller at
least two business days prior to the Closing Date.
(c) The parties hereby agree that the Purchase Price shall be
allocated for purposes of this Agreement and federal, state and local Tax
purposes as set forth on Annex A. The parties shall file all federal, state,
-------
local and foreign Tax returns, including Internal Revenue Form 8594 in
accordance with the allocation set forth on Annex A.
-------
2.6 Purchase Price Adjustment.
-------------------------
(a) Within five days after the Closing Date, Seller shall prepare and
deliver to Purchaser the Statement of Adjustments, which shall set forth the
Current Assets, the Capital Expenditure Amount and the Current Liabilities,
including all adjustments as required in a year-end closing of the books,
together with Seller's good faith determination of the Purchase Price
Adjustment.
(b) During the 30 days after Seller delivers the Statement of
Adjustments, Seller shall permit Purchaser full access to Seller's and, with
respect to the Business, Ball's books and records, as well as their respective
working papers and the working papers of their respective accountants or other
representatives, relating to the Statement of Adjustments for the purpose of
determining whether the Current Assets and the Current Liabilities are properly
and correctly reflected on the Statement of Adjustments. Unless Purchaser
earlier provides written notice to Seller specifying in reasonable detail
error(s) in the Statement of Adjustments or an item or items reflected therein
that Seller has not treated properly or correctly (a "Notice of Disagreement"),
----------------------
30 days after Seller delivers the Statement of Adjustments, the Statement of
Adjustments shall become final and binding. If a Notice of Disagreement is
received by Seller in compliance with the foregoing, then the Statement of
Adjustments and the determination of the Purchase Price Adjustment (as revised
in accordance with clause (x) or (y) below) shall become final and binding upon
the parties on the earliest of (x) the date the parties hereto resolve in
writing any differences they have with respect to the matters specified in the
-14-
<PAGE>
Notice of Disagreement or (y) the date all matters in dispute are finally
resolved in writing by the Accounting Firm (as defined below). During the 30
days following delivery of a Notice of Disagreement, Purchaser and Seller shall
seek in good faith to resolve in writing any differences which they may have
with respect to the matters specified in the Notice of Disagreement. During
such period, Seller shall be permitted to review Purchaser's books and records
and working papers relating to the Notice of Disagreement. At the end of such
30-day period, Purchaser and Seller shall submit to a mutually satisfactory
independent accounting firm (the "Accounting Firm") for review and resolution of
---------------
all matters which remain in dispute which were included in the Notice of
Disagreement, and the Accounting Firm shall make a final determination of the
Statement of Adjustments and the Purchase Price Adjustment in accordance with
the guidelines and procedures set forth in this Agreement. If Purchaser and
Seller are unable to mutually agree on an Accounting Firm, Purchaser and Seller
shall select a "big-six" Accounting Firm by lot (after excluding one big-six
accounting firm selected by each of Purchaser and Seller). The Statement of
Adjustments and the Purchase Price Adjustment as determined in accordance with
this Section 2.6 shall become final and binding on the parties on the date the
Accounting Firm delivers its final resolution in writing to the parties (which
final resolution shall be delivered not more than 45 days following submission
of such disputed matters). The fees and expenses of the Accounting Firm shall
be shared equally by Purchaser and Seller.
(c) For purposes of preparing the Statement of Adjustments and
determining the Purchase Price Adjustment, Purchaser and Seller shall jointly
take a physical count of all the Inventory as of 12:01 a.m. on the Closing Date,
conducted and valued in accordance with Seller's past practices and procedures.
(d) Within one business day after the Statement of Adjustments becomes
final and binding on the parties, (i) if the sum of Current Assets plus the
----
Capital Expenditure Amount exceeds the sum of the Current Liabilities plus $11.0
----
million, Purchaser shall pay to Seller by wire transfer of immediately available
funds an amount equal to the difference, and (ii) if the sum of the Current
Liabilities plus $11.0 million exceeds the Current Assets plus the Capital
---- ----
Expenditure Amount, Seller shall pay to Purchaser by wire transfer of
immediately available funds an amount equal to the difference, which amount, in
either case, shall be the "Purchase Price Adjustment".
-------------------------
2.7 Prorations. The expenses and obligations set forth below shall
----------
be prorated as of 12:01 a.m. on the Closing Date, with Seller being responsible
for that portion arising prior thereto and Purchaser being responsible for that
portion arising subsequent thereto. The following expenses and obligations
shall be prorated, provided that in no event will the computation of any
proration include any item included in the Purchased Assets or the Retained
Liabilities:
(a) all governmental license, permit or franchise fees and all other
fees, royalties, rentals or charges, not delinquent, paid or payable under any
of the Contracts shall be prorated on the basis of the number of days of the
relevant fiscal or other time period which have elapsed through the Closing
Date;
-15-
<PAGE>
(b) all real and personal property Taxes and assessments with respect
to the Real Property and any other Purchased Assets shall be prorated on the
basis of the number of days of the relevant Tax year or period which have
elapsed prior to the Closing Date; and
(c) all charges and rents for utilities (including without limitation,
electricity, fuel, water, sanitation and garbage disposal) and other services
and goods furnished to, or in connection with, the operations of Seller shall be
prorated on the basis of the number of days of the relevant time period which
have elapsed prior to the Closing Date; provided that no Deposits of Seller
shall be prorated, but rather are included in the Purchased Assets.
Seller shall use all reasonable efforts to cause all utility billings
of Seller to be closed and billed by the respective utility companies as of the
Closing Date in order that utility charges may be separately billed for the
period prior to the Closing Date and the period after the Closing Date. In the
event any such utility charges are not separately billed, they shall be
prorated, presuming that such charges were uniformly incurred during the billing
period in question.
All of the foregoing prorations shall be computed by Seller and
included on the Statement of Adjustments as Current Assets or Current
Liabilities, as the case may be.
If any item described in this Section 2.7 cannot be prorated, adjusted
or determined as of the Closing Date, then it shall be separately prorated,
adjusted and determined as soon as possible thereafter with payment of an amount
equal to the amount charged against either party being paid by that party to the
other by check within five (5) days after determination of the charge.
2.8 Nonassignable Contracts. At its own cost, Seller shall use all
-----------------------
reasonable efforts to obtain all consents and approvals necessary to assign to
Purchaser any contract, lease,
license, permit or other agreement of Seller that is included in the Purchased
Assets (the "Contracts"). To the extent that the assignment hereunder by Seller
---------
to Purchaser of any Contract is not permitted or is not permitted without the
consent of any other party to the Contract, this Agreement shall not be deemed
to constitute an assignment of any such Contract if such consent is not given or
if such assignment otherwise would constitute a breach of, or cause a loss of
contractual benefits under, any such Contract, and Purchaser shall assume no
obligations or liabilities thereunder. Seller shall advise Purchaser promptly
in writing with respect to any Contract under which it knows or has reason to
believe it will not receive the required consent. Without in any way limiting
Seller's obligations to use all reasonable efforts to obtain all consents and
waivers necessary for the sale, transfer, assignment and delivery of the
Contracts and the Purchased Assets to Purchaser hereunder, if any such consent
is not obtained or if such assignment is not permitted irrespective of consent
and the Closing hereunder is consummated, Seller shall continue to use all
reasonable efforts to obtain such consents and shall cooperate with Purchaser in
any arrangement designed to provide Purchaser with the rights and benefits
(subject to the obligations) under the Contracts.
-16-
<PAGE>
ARTICLE III
THE CLOSING
3.1 Time and Place of Closing. The consummation of the transactions
-------------------------
provided for in this Agreement ("Closing") shall be held at the offices of
-------
Kirkland & Ellis, 200 East Randolph Drive, Chicago, Illinois 60601 at 10:00 a.m.
local time, on October 28, 1996, or if the conditions to Closing set forth in
Article V have not been satisfied on or prior to such date, on the third
business day following satisfaction of such conditions (the "Closing Date"), or
------------
at such other place and time as the parties may agree.
3.2 Deliveries by Seller. On or prior to the Closing, Seller and/or
--------------------
Ball will deliver to Purchaser the following duly and properly executed:
(a) Such instruments of sale, transfer, assignment, conveyance and
delivery (including, without limitation, a general warranty deed with respect to
the Owned Real Property, in form and substance reasonably satisfactory to
Purchaser, subject only to the Permitted Encumbrances, all bills of sale and all
vehicle and personal property titles), in form and substance reasonably
satisfactory to Purchaser, as are required or reasonably requested by Purchaser
in order to transfer to Purchaser good and valid title to the Personal Property
(other than assets subject to Personal Property Leases), free and clear of all
liens, charges, security interests and other encumbrances;
(b) Copies of (i) the resolutions duly adopted by Seller's and Ball's
boards of directors authorizing the execution, delivery and performance of this
Agreement, the documents contemplated hereby and the consummation of the related
transactions, (ii) the Certificates of Incorporation of Seller and (iii) the by-
laws of Seller, in each case accompanied by a certificate of the General Counsel
or other authorized officer of Seller or Ball, as applicable, certifying that
the same are in full force and effect without modification or amendment;
(c) Certificates as to the good standing of Seller in its jurisdiction
of incorporation and in the state of Ohio, in each case certified by the
Secretary of State of the applicable jurisdiction; and
(d) All other agreements, documents, instruments and writings required
to be delivered by Seller at or prior to the Closing Date pursuant to this
Agreement or otherwise required, or reasonably requested by Purchaser, in order
to consummate the transactions contemplated hereby.
3.3 Deliveries by Purchaser. At the Closing, Purchaser will deliver
-----------------------
the following to Seller:
(a) The Cash Purchase Price by wire transfer of immediately available
funds, to an account designated by Seller to Purchaser at least two business
days prior to the Closing Date;
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<PAGE>
(b) The Pension Funding Amount by wire transfer of immediately
available funds, to an account designated by Seller to Purchaser at least two
business days prior to the Closing Date (which amount may be deemed an addition
to the Purchase Price);
(c) The Note in form reasonably acceptable to the parties hereto;
(d) Copies of (i) the resolutions duly adopted by Purchaser's board of
directors authorizing the execution, delivery and performance of this agreement,
the documents contemplated hereby, and the consummation of the related
transactions, (ii) the Certificate of Incorporation of Purchaser and (iii) the
by-laws of Purchaser, in each case accompanied by a certificate of the General
Counsel or other authorized officer of Purchaser certifying that the same are in
full force and effect without modification or amendment; and
(e) All other agreements, documents, instruments and writings required
to be delivered by Purchaser at or prior to the Closing Date pursuant to this
Agreement or otherwise required, or reasonably requested by Seller, in
connection herewith.
ARTICLE IV
CONDITIONS TO SELLER'S OBLIGATIONS
The obligations of Seller to consummate the transactions contemplated
by this Agreement are subject, in the discretion of Seller, to the satisfaction
at or prior to the Closing Date of each of the following conditions.
4.1 Representations, Warranties and Covenants. All representations
-----------------------------------------
and warranties of Purchaser contained in Article VII of this Agreement that are
not qualified as to materiality shall be true and correct in all material
respects at and as of the Closing Date as if such representations and warranties
were made at and as of the Closing Date and all of Purchaser's representations
and warranties contained in Article VII of this Agreement that are qualified as
to materiality shall be true and correct in all respects at and as of the
Closing Date as if such representations and warranties were made at and as of
the Closing Date. Purchaser shall have fully performed and complied with in all
material respects all agreements and covenants required by this Agreement to be
performed by it prior to or at the Closing Date. On the Closing Date, there
shall be delivered to Seller a certificate (dated the Closing Date and signed by
the Chairman of the Board, the President or a Vice President of Purchaser) as to
the matters set forth in this Section 4.1.
4.2 No Injunction. No injunction, stay or restraining order shall be
-------------
in effect prohibiting the consummation of the transactions contemplated by this
Agreement.
4.3 Collective Bargaining Agreements. Purchaser shall have assumed
--------------------------------
the Collective Bargaining Agreements in accordance with the provisions of
Article X hereof.
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<PAGE>
4.4 Hart-Scott-Rodino Act. All filings required to be made under the
---------------------
Hart-Scott-Rodino Act shall have been made, and any applicable waiting period
thereunder shall have expired.
4.5 Opinion of Counsel. Purchaser shall have delivered to Seller an
------------------
opinion of Kirkland & Ellis, counsel to Purchaser, dated the Closing Date, in
form and substance reasonably satisfactory to Seller.
4.6 Materials Supply Agreement. Purchaser and Seller shall have
--------------------------
entered into the Materials Supply/Tolling Agreement based substantially on the
form of Exhibit A attached hereto (the "Materials Supply Agreement"), and the
--------- --------------------------
Materials Supply Agreement shall be in full force and effect as of the Closing.
4.7 Food Can Tolling Agreements. Purchaser and Seller shall have
---------------------------
entered into the Food Can Tolling Agreement and a lease of the associated
equipment which is included in the Excluded Assets hereunder, both of which
shall be in form and content reasonably acceptable to Purchaser and Seller (the
"Food Can Tolling Agreements"), pursuant to which Purchaser shall perform
certain manufacturing services with respect to the sanitary food can business
being conducted by Seller at the Owned Real Property.
4.8 Certificates, Agreements and Other Documents. Purchaser shall
--------------------------------------------
have furnished Seller with each of the deliveries required under Section 3.3
above.
Each of the preceding conditions may be waived only if such waiver is
set forth in a writing executed by Seller.
ARTICLE V
CONDITIONS TO PURCHASER'S OBLIGATIONS
The obligations of Purchaser to consummate the transactions
contemplated by this Agreement are subject, in the discretion of Purchaser, to
the satisfaction at or prior to the Closing Date of each of the following
conditions.
5.1 Representations, Warranties and Covenants. All representations
-----------------------------------------
and warranties of Seller and Ball contained in Article VI of this Agreement to
the extent not qualified as to materiality shall be true and correct in all
material respects at and as of the Closing Date as if such representations and
warranties were made at and as of the Closing Date and all of Seller's and
Ball's representations and warranties contained in Article VI of this Agreement
to the extent qualified as to materiality shall be true and correct in all
respects at and as of the Closing Date as if such representations and warranties
were made at and as of the Closing Date (in each case, without any disclosure
made pursuant to Section 8.1(j) being deemed to have cured any such breach).
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<PAGE>
Seller shall have fully performed and complied with, in all respects all
agreements and covenants required by this Agreement to be performed by it prior
to or at the Closing Date. On the Closing Date, there shall be delivered to
Purchaser a certificate (dated the Closing Date and signed by the Chairman of
the Board, the President or a Vice President of Seller and Ball) as to the
matters set forth in this Section 5.1.
5.2 Consents and Approvals. Seller shall have received, at its sole
----------------------
cost and expense (other than the cost and expense of filings required under the
Hart-Scott-Rodino Act, the fees for which shall be borne as provided in such
Act), without any condition adverse to Purchaser, all third party and
governmental consents and approvals to the consummation of the transactions
contemplated hereby necessary under any law, statute, rule, regulation, license,
permit, agreement, instrument, order, judgment or decree, for Seller to conduct
the operations of the Business in materially the same manner after the Closing
as Seller conducted such operations prior to Closing, and any such license or
permit shall have been issued in the name of the Purchaser or its designee to
the extent required by applicable law, regulation or order
5.3 No Litigation. No injunction, stay or restraining order shall be
-------------
in effect prohibiting the consummation of the transactions contemplated by this
Agreement. No suit, action or other proceeding shall be pending, before any
court or governmental or regulatory official, body or authority that is
reasonably likely to have a material adverse effect on the business, financial
condition, operating results, assets or operations of the Business after the
Closing or adversely affect the right of Purchaser to own or control the
Purchased Assets or the Business and no investigation by a Governmental Entity
that would result in any such suit, action or proceeding shall be pending.
5.4 Opinion of Counsel. Seller shall have delivered to Purchaser
------------------
opinions of Skadden, Arps, Slate, Meagher & Flom and Robert W. McClelland,
Seller's counsel, dated the Closing Date, in form and substance reasonably
satisfactory to Purchaser.
5.5 Hart-Scott-Rodino Act. All filings required to be made under the
---------------------
Hart-Scott-Rodino Act shall have been made, and any applicable waiting period
thereunder shall have expired.
5.6 Transition Services. Purchaser and Seller shall have entered
-------------------
into a Transition Services Agreement in form and content reasonably acceptable
to Purchaser and Seller (the "Transition Services Agreement"), pursuant to which
-----------------------------
Seller shall provide the services marked with an asterisk (*) on the
Intercompany Services Schedule to Purchaser for an interim period following the
- ------------------------------
Closing, and the Transition Services Agreement shall be in full force and effect
as of the Closing.
5.7 Materials Supply Agreement; Food Can Tolling Agreements.
-------------------------------------------------------
Purchaser and Seller shall have entered into the Materials Supply Agreement and
the Food Can Tolling Agreements, and each such agreement shall be in full force
and effect as of the Closing.
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<PAGE>
5.8 Title Insurance and Survey.
--------------------------
(a) As of the date hereof, Purchaser has obtained, at Purchaser's cost
and expense, a commitment for an ALTA Owner's Title Insurance Policy - Form B-
1992 for the Owned Real Property (the "Title Commitment"), issued by First
----------------
American Title Insurance Company (the "Title Insurance Company"), together with
-----------------------
copies of all underlying title documents identified in the Title Commitment.
(b) At the Closing, Purchaser shall have received at Purchaser's sole
cost and expense, a title insurance policy (which may be in the form of a mark-
up of the Title Commitment) in accordance with the Title Insurance Commitment,
insuring Purchaser's fee simple interest in the Owned Real Property as of the
Closing Date (including all recorded easements benefitting such parcel) with gap
coverage from Seller through the date of recording, subject only to the
Permitted Encumbrances, and in such amount as Purchaser determines to be the
fair market value (including all Improvements thereon) of the Owned Real
Property insured thereunder (the "Title Insurance Policy"). The Title Insurance
----------------------
Policy shall include the following endorsements (to the extent available from
the Title Insurance Company in Ohio with respect to the Owned Real Property,
Purchaser shall pay any additional fee for such endorsements): (i) an "extended
coverage endorsement" (insuring over the general or standard exceptions); (ii)
an ALTA Zoning Endorsement 3.1, with parking (or equivalent); (iii) survey
endorsement (insuring that the parcel described in such Title Insurance Policy
is the parcel shown on the survey delivered with respect to such parcel); (iv)
access endorsement (insuring that each street adjacent to such parcel is a
public street and that there is direct and unencumbered pedestrian and vehicular
access to such street from such parcel; (v) if the Owned Real Property covered
by such policy consists of more than one record parcel, a "contiguity"
endorsement (insuring that all of the record parcels are contiguous to one
another); (vi) a tax number endorsement (insuring the tax parcel number includes
no other real property); (vii) an owner's comprehensive endorsement; and (viii)
such other endorsements as reasonably requested by Purchaser.
(c) Purchaser shall have obtained, at Purchaser's cost and expense, a
current survey dated not earlier than 45 days prior to Closing for each parcel
of Owned Real Property for
which a Title Insurance Policy is required, prepared by Bock & Clark National
Surveyors Network or other licensed surveyor satisfactory to Purchaser, and
conforming to 1992 ALTA/ACSM Minimum Detail Requirements for Urban Land Title
Surveys, including Table A Items Nos. 1 through 4 and 6 through 13, and such
other standards as the Title Insurance Company requires as a condition to the
removal of any survey exceptions from the Title Insurance Policies, and
certified to Purchaser, Purchaser's lender (if any) and the Title Insurance
Company, in a form satisfactory to such parties (collectively, the "Surveys").
-------
The Surveys shall not disclose any item, survey defect or encroachment from or
onto any of the Owned Real Property which has a material adverse effect on the
use, value, marketability or access to the Owned Real Property (other than any
Permitted Encumbrances) which has not been cured or insured over prior to the
Closing.
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<PAGE>
5.9 No Material Adverse Change. From the date hereof through and
--------------------------
including the Closing Date, there has been no material adverse change in the
financial condition or results of operations of the Business, Purchased Assets
or operations of Seller with respect to the Business or the Purchased Assets.
5.10 Lien Searches. Purchaser shall have obtained a current lien
-------------
search report indicating that as of the Closing Date there are no security
interests, judgments, tax or other liens outstanding against any of the
Purchased Assets owned by Seller (whether real, personal, tangible or
intangible) other than Permitted Liens or Permitted Encumbrances.
5.11 Certificates, Agreements and Other Documents. Seller shall have
--------------------------------------------
furnished Purchaser with each of the deliveries required under Section 3.2
above.
Each of the preceding conditions shall be waived only if such waiver
is set forth in a writing executed by Purchaser.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF SELLER AND BALL
As an inducement to Purchaser to enter into this Agreement, each of
Seller and Ball hereby represents and warrants to Purchaser as follows:
6.1 Due Incorporation, Etc. Seller is a corporation duly
----------------------
incorporated, validly existing and in good standing under the laws of the State
of Delaware. Ball is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of Indiana. Seller has all requisite
corporate power and authority to own and operate the Business as it is presently
being conducted and to own and lease the properties and assets owned or leased
by it relating to the Business. Seller is duly licensed and qualified to do
business and is in good standing in each jurisdiction in which the properties
owned or leased or the operation of the Business makes such licensing or
qualification necessary. Complete and correct copies of the Certificate of
Incorporation and Bylaws, as amended to date, of Seller have been delivered to
Purchaser.
6.2 Subsidiaries. With respect to the Business, Seller does not own
------------
any stock, partnership interest, joint venture interest or other security or
interest in any other Person and no stock, partnership interest, joint venture
interest or other security or interest in any other Person is included in the
Purchased Assets.
6.3 Authorization, No Conflicts, Etc. Seller and Ball each has full
---------------------------------
power and authority to enter into this Agreement and the other agreements
contemplated hereby and to carry out the transactions contemplated hereby and
thereby. The execution, delivery and performance of this Agreement and the
-22-
<PAGE>
other agreements contemplated hereby and the consummation of the transactions
contemplated hereby and thereby by Seller, Ball and their respective Affiliates
have been, or prior to the Closing will be, duly authorized by all requisite
corporate action on the part of Seller or Ball, as applicable. This Agreement
and the other agreements contemplated hereby have been duly executed and
delivered by Seller and Ball and (assuming the due authorization, execution and
delivery hereof by Purchaser) are each a valid and binding obligation of Seller
and Ball, enforceable against each in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium and similar laws
affecting creditors' rights and remedies generally, and subject, as to
enforceability, to general principles of equity (regardless of whether
enforcement is sought in a proceeding at law or in equity). Except as set forth
on the Conflicts Schedule attached hereto, the execution, delivery and
------------------
performance of this Agreement and the other agreements contemplated hereby and
the consummation of the transactions contemplated hereby and thereby by Seller
and/or Ball will not: (a) violate any provisions of law applicable to Seller or
Ball; (b) with or without the giving of notice and/or the passage of time,
conflict with, result in the breach of any provision of, give any third party
the right to terminate or to accelerate any obligation under, or result in the
creation of any lien, security interest or charge or encumbrance under, the
Certificate of Incorporation or Bylaws of Seller or Ball or any material
instrument, license, agreement, arrangement, indenture or commitment to which
Seller or Ball is a party or by which any of its assets or properties are bound;
or (c) constitute a violation of any order, judgment or decree to which Seller,
Ball or any of their respective Affiliates which are party hereto or thereto is
a party or by which any of their assets or properties are bound.
6.4 Consents and Approvals. The execution and delivery by Seller and
----------------------
Ball of this Agreement does not, and compliance by Seller and Ball with the
terms hereof and consummation of the transactions contemplated hereby will not
require Seller or Ball, or to Seller's or Ball's knowledge, the Purchaser, to
obtain any authorization, consent, approval, exemption or action of, or make any
filing with or give any notice to, any court or administrative or governmental
body or any other Person pursuant to (i) the Certificate of Incorporation or
Bylaws of Seller or Ball or (ii) any law, statute, rule, regulation, agreement,
permit, license, instrument, order, judgment or decree to which Seller is
subject, except as disclosed on the Consents Schedule attached hereto.
-----------------
6.5 Absence of Violations. Except as disclosed on the Violations
--------------------- ----------
Schedule attached hereto, with respect to the Business and the Purchased Assets,
- --------
and except with respect to any Environmental and Safety Requirements, Seller is
not in violation of its Certificate of Incorporation or Bylaws, or in violation
(or with or without notice or lapse of time or both would be in violation), in
any way of any term or provision of (a) any law, statute, ordinance, rule,
regulation, order, writ, judgment, injunction, permit or decree applicable to
the Business or the
Purchased Assets or (b) any Material Contract included in the Purchased Assets
or Assumed Liabilities or by which any of the Purchased Assets are bound.
6.6 Licenses and Permits. Except as disclosed on the Permits
-------------------- -------
Schedule attached hereto, (a) Seller has complied and is in compliance in all
- --------
material respects with all licenses, franchises, permits (including without
limitation environmental and construction permits and operating permits),
approvals, authorizations, exemptions, certificates, registrations, and similar
-23-
<PAGE>
documents or instruments required to own and operate the Purchased Assets and to
conduct the Business as presently conducted; and (b) all such licenses,
franchises, permits (including without limitation environmental and construction
permits and operating permits), approvals, authorizations, exemptions,
certificates, registrations, and similar documents or instruments are valid,
binding, and in full force and effect.
6.7 Books, Records and Forecasts.
----------------------------
(a) The Budgets and Forecasts were prepared in the ordinary course
for use in Seller's business and not for purposes of being provided to
Purchaser, and were actually used by Seller's management to plan the operations
of the Business where applicable.
(b) The historical sales data included in the Books and Records are
accurate and complete in all material respects, fairly present in all material
respects the number of units actually sold and the revenue actually generated by
the Business during the applicable periods and were derived from Seller's
accounting books and records.
(c) Thomas Hale, Vice President of Sales and Marketing, had no
knowledge on July 3, 1996 that data included in the Books and Records regarding
market share that was prepared by a third party was materially misleading (it
being understood that Seller in no manner warrants the accuracy of such data).
(d) The copies of the purchase order and budget relating to the
capital investment project being funded by the Capital Expenditure Amount
included in the Books and Records are each accurate copies of Seller's actual
records with respect to such items.
6.8 Financial Statements. Attached hereto as the Financial Statements
-------------------- --------------------
Schedule are the following financial statements of the Business:
- --------
(a) Seller's unaudited balance sheet with respect to the Business as
of September 1, 1996, and the related statement of gross profits for the eight-
month period then ended (such balance sheet being referred to herein as the
"August Balance Sheet"); and
- ---------------------
(b) Seller's unaudited Statement of Net Assets with respect to the
Business as of December 31, 1995.
Each of the foregoing financial statements (including in all cases the notes
thereto, if any) is consistent with Seller's general ledger and trial balance as
of such date (which, in turn, have been
prepared in a manner consistent with Ball's internal accounting policy, which
has been consistently applied), and fairly present in all material respects the
financial position and Seller's gross profits with respect to the Business, as
of the dates and for the periods set forth therein (it being understood that
costs have been apportioned in a manner consistent with past practice), subject
to the lack of footnote disclosure and changes resulting from normal year-end
audit adjustments.
-24-
<PAGE>
6.9 Absence of Undisclosed Liabilities. Except as expressly set
----------------------------------
forth in detail on the Liabilities Schedule attached hereto, as of the date
--------------------
hereof and as of the date of Closing, Seller has no material liabilities or
obligations of any kind with respect to the Business (other than environmental
liabilities) or the transactions contemplated hereby, whether accrued, absolute,
contingent, unliquidated or otherwise, whether or not known to the Seller,
whether due or to become due and regardless of when or by whom asserted, which
are not fully and specifically reflected or reserved against on the August
Balance Sheet and which are reasonably likely to have an adverse effect on the
Purchased Assets or the operation of the Business after the Closing.
6.10 No Material Adverse Change. Except as set forth on the Changes
-------------------------- -------
Schedule, there has been no material adverse change in the financial condition
- --------
or results of operations, or the Business, Purchased Assets, or operations of
Seller with respect to the Business or the Purchased Assets from December 31,
1995 until the date hereof.
6.11 Absence of Certain Developments. Except as expressly
-------------------------------
contemplated by this Agreement or disclosed on the Developments Schedule
---------------------
attached hereto, since December 31, 1995, Seller has not with respect to the
Business, nor have any of Seller's Affiliates on behalf of Seller and with
respect to the Business:
(a) mortgaged, pledged or subjected to any lien, charge or any other
encumbrance, any of the Purchased Assets, except Permitted Liens or Permitted
Encumbrances;
(b) sold, assigned or transferred any of the tangible Purchased Assets
or leases, except in the ordinary course of business consistent with past
practice, or removed any such assets from their customary location;
(c) sold, assigned or transferred any patents, trademarks, trade
names, copyrights, trade secrets or other similar intangible assets included in
the Purchased Assets;
(d) suffered any extraordinary losses or waived any rights of material
value, whether or not in the ordinary course of business or consistent with past
practice;
(e) made any commitments on behalf of the Business for capital
expenditures in an amount in excess of $50,000 which will not be paid for in
full prior to Closing;
(f) entered into any transaction or agreement on behalf of the
Business other than in the ordinary course of business, or entered into any
transaction on behalf of the Business with any of Seller's, Ball's or the
Business' officers, directors, shareholders or other affiliates or insiders;
(g) suffered any material damage, destruction or casualty loss to any
of its assets or properties, whether or not covered by insurance;
-25-
<PAGE>
(h) made or granted any bonus or any wage or salary increase to any
employee or group of employees of the Business, or made or granted any increase
in its profit sharing plan, employee compensation reimbursement program or any
other employee benefit plan, except in accordance with past custom and practice;
or
(i) amended in a manner adverse to Purchaser any Assumed Contracts or
other agreements to which it is a party and which are Purchased Assets or
Assumed Liabilities or waived any rights or obligations thereunder;
6.12 Customers and Agents. The Customers Schedule attached hereto
-------------------- ------------------
lists, for each of the ten largest customers of the Business during the past
eight (8) months, (the "Top Customers") and sales made to the Top Customers
-------------
during the eight-month period ended on August 31, 1996. The Customers Schedule
------------------
lists for each sales agent of the Business and the sales originated by such
agent during the last eight (8) months. Except as set forth on the Customers
---------
Schedule, Seller has not received any notice and Thomas Hale, Vice President of
- --------
Sales and Marketing, has no knowledge that any Top Customer intends to terminate
or materially reduce its business with Seller in the future and, no such
customer has terminated or materially reduced its business with Seller during
the past twelve (12) months.
6.13 Insurance. The Insurance Schedule attached hereto contains a
--------- ------------------
complete list of all liability, property, accident, casualty, fire, flood,
workers compensation, key man, group life or health, and other insurance
policies and arrangements affecting or relating to the ownership, use, or
operations of any of the Purchased Assets or the Business. Effective as of the
Closing, Seller intends to eliminate insurance coverage relating to the
Business.
6.14 Material Contracts.
------------------
(a) Except as set forth on the Contracts Schedule attached hereto
------------------
(which items are referred to herein as the "Material Contracts"), with respect
------------------
to the Business, other than contracts with suppliers for raw materials, neither
Seller nor Ball is a party to any written or oral: (i) contract for the
employment of any officer, individual employee, or other person on a full-time
basis; (ii) agreement or indenture relating to the borrowing of money or to
mortgaging, pledging or otherwise placing a lien on any of its real or personal
properties (whether tangible or intangible); (iii) guaranty of any obligation
for borrowed money or otherwise; (iv) license or royalty agreement; (v) contract
or group of related contracts with the same party for the purchase of goods,
products or services (including advertising, public relations, consulting or
management services) under which the undelivered balance of such goods, products
or services requires aggregate annual payments in excess of $20,000 or
continuing over a period of more than six (6) months from the date or dates
thereof and not terminable by Seller on thirty (30) days' or less notice without
penalties; (vi) any contract or group of related contracts with the same party
for the sale of goods, products or services involving aggregate annual receipts
in excess of $100,000; (vii) contract with the Federal government of the United
States or any branch or administrative body thereof; (viii) contract which
-26-
<PAGE>
prohibits Seller from freely engaging in the Business anywhere in the world;
(ix) nondisclosure or confidentiality agreement; (x) contract relating to the
distribution of products or services of the Business; (xi) contract with any
officer or director of Seller or Ball or any of its Affiliates, or any relative
of any officer or director of Seller or Ball or any of its Affiliates; (xii)
agreements with respect to the lending or investing of funds; or (xiii) other
agreement material to the Business or not entered into in the ordinary course of
business.
(b) Except as set forth on the Contracts Schedule, with respect to the
------------------
Business, (i) no Material Contract has been breached or canceled by the other
party since the date of August Balance Sheet; (ii) Seller has in all material
respects performed all the obligations required to be performed in connection
with any Material Contract and is not in default of any of its obligations (nor
is it in receipt of any claim of default) under any such Material Contract; and
(iv) Seller has no knowledge of any breach or anticipated breach by any other
party to any Material Contract.
(c) Purchaser has been supplied with a true and correct copy of all
written Material Contracts (other than the purchase orders from Seller's
customers) together with all amendments, waivers or other changes thereto and
all correspondence delivered or received with respect thereto.
6.15 Assets. Except as set forth on the Assets Schedule attached
------ ---------------
hereto, the Purchased Assets include all assets necessary and sufficient to
operate the Business as a going concern in all material respects as previously
conducted by Seller, and also include all assets which have been used since July
15, 1996 in the conduct of the Business at the Owned Real Property as it has
been previously conducted for the last twelve (12) months, except for inventory
sold or otherwise disposed of in the ordinary course of business consistent with
past practices. The Purchased Assets have been used in the ordinary course of
business and since July 15, 1996 have been maintained in a manner consistent
with prior practice, which practice is generally consistent with industry
practice.
6.16 Real Properties.
---------------
(a) Owned Properties. The Owned Properties Schedule sets forth the
---------------- -------------------------
address and a true, correct, current and complete legal description of the Owned
Real Property. With respect to each parcel of Owned Real Property: (i) Seller
has good and marketable fee simple title to such parcel, free and clear of all
encumbrances as of the Closing Date, except Permitted Encumbrances; (ii) there
are no leases, subleases, licenses, concessions or other agreements, written or
oral, granting to any person the right to use or occupy such parcel or any
portion thereof; and (iii) other than the right of the Purchaser pursuant to
this Agreement, there are no outstanding options or rights of first refusal to
purchase such parcel, or any portion thereof or interest therein.
The term "Permitted Encumbrances" shall mean the encumbrances set
----------------------
forth on the Permitted Encumbrances Schedule attached hereto, subject to
-------------------------------
Purchaser's approval of any survey defects or encroachments reflected on the
Survey; provided that Purchaser shall be deemed to have approved such survey
-27-
<PAGE>
defects or encroachments, unless Purchaser objects thereto prior to the
Closing Date and Purchaser may only object if such encumbrance impairs the
marketability, occupancy, use or value of such parcel.
(b) Real Property Used in Seller's Business. The Owned Real Property
---------------------------------------
constitutes all of the real property used by Seller in the operation of the
Business. Seller is not a party to any lease, sublease, license, concession or
other agreement for the use or occupancy of real property which is used in the
operation of the Business.
(c) Condemnation and Litigation. There are no condemnation or other
---------------------------
eminent domain proceedings pending, or to Seller's knowledge, threatened,
affecting any Owned Real Property or any portion thereof. There is no writ,
injunction, decree, order or judgment outstanding, nor any litigation,
administrative actions or similar proceedings pending or, to Seller's knowledge,
threatened, relating to the ownership, lease, use, occupancy or operation of any
Owned Real Property or any portion thereof.
(d) Condition and Operation of Improvements. All buildings and all
---------------------------------------
components of all buildings, structures and other improvements included within
the Owned Real Property (the "Improvements") have been used by Seller only in
------------
the ordinary course of the Business and the sanitary food can business and have
been maintained in manner consistent with prior practice such that the Owned
Real Property and the Improvements will be in substantially the same condition
(subject to normal wear and tear) as when viewed by Purchaser's representatives
on July 15, 1996. All water, gas, electrical, steam, compressed air,
telecommunication, sanitary and storm sewage lines and systems and other similar
systems reasonably necessary to operate the Business as presently conducted have
been installed and are operating and sufficient to conduct the Business as
presently conducted, and all hook-up fees or other similar fees or charges due
prior to the date hereof and at Closing have been fully paid.
(e) Real Property Permits. All certificates of occupancy, permits,
---------------------
licenses, franchises, approvals and authorizations (collectively, the "Real
----
Property Permits") of all governmental authorities having jurisdiction over the
- ----------------
Owned Real Property, which are required to lawfully occupy, use and operate the
Owned Real Property as necessary to conduct Business as presently conducted,
have been issued and are in full force and effect as of the date hereof. Seller
has not received any written notice from any governmental authority having
jurisdiction over the Owned Real Property threatening a suspension, revocation,
modification or cancellation of any Owned Real Property Permit. The Real
Property Permits are transferable to Purchaser without the consent or approval
of any governmental authority.
(f) Compliance with Laws. The Owned Real Property is in full
---------------------
compliance with all applicable building, zoning, subdivision and other land use
and similar Laws affecting the Owned Real Property (collectively, the "Real
----
Property Laws"), and Seller has not received any notice of violation or claimed
- -------------
violation of any Real Property Law. Seller's use and operation of the Owned
Real Property or any portion thereof as necessary in the operation of the
Business as presently conducted, is not dependent on a nonconforming use or
-28-
<PAGE>
other approval from a governmental authority, the absence of which would
significantly limit the use of such Owned Real Property or the operation of the
Business.
(g) Flood Hazard Area. None of the Owned Real Property nor any
-----------------
portion thereof is located in any flood plain which requires Seller to obtain
federal flood hazard insurance, or obtain any Owned Real Property Permits for
the occupancy, use or operation of such Owned Real Property.
(h) Insurability of the Owned Real Property. Seller has not received
---------------------------------------
any written notice from any insurance company or any board of fire underwriters
(or body having similar functions) with respect to any Owned Real Property or
any portion thereof: (i) requesting Seller to perform any repairs, alterations,
improvements or other work for such Owned Real Property which Seller has not
completed in full; or (ii) notifying Seller of any defects or inadequacies in
such Owned Real Property which would materially adversely affect the
insurability of the Owned Real Property or the premiums for the insurance
thereof.
(i) Access to Owned Real Property. The Owned Real Property has
-----------------------------
unqualified access to public roads.
6.17 Tangible Personal Property. Except as set forth on the Personal
-------------------------- --------
Property Schedule attached hereto: (a) Seller has, and as of the Closing will
- -----------------
have, good and valid title to all of the items of tangible personal property
included in the Purchased Assets or used in the Business as presently conducted;
(b) all such material tangible personal property is reflected on the August
Balance Sheet (except for such property acquired, sold or disposed of subsequent
to the date thereof in the ordinary course of business consistent with past
practices); and (c) all such tangible personal property is owned free and clear
of any liens, leases, security interests, charges, restrictions or encumbrances,
including without limitation, encumbrances in connection with financial
arrangements such as guarantees, pledges, collateral assignments and other
similar arrangements (together, "Personal Property Liens") except (i) Personal
-----------------------
Property Liens for current taxes not yet due and payable or being contested in
good faith by appropriate proceedings, (ii) Personal Property Liens placed on
any leasehold interest that is included in the Purchased Assets and (iii) liens
(other than liens resulting from Seller's failure to pay or perform an
obligation when due) arising as a matter of law in the ordinary course of
business ("Permitted Liens").
---------------
6.18 Proprietary Rights. The Proprietary Rights Schedule attached
------------------ ---------------------------
hereto sets forth a list of each patent and patent application, trademark,
service mark, trade name and any application to register any of the foregoing,
registered copyright (or application therefore), and any licenses to or from
third parties with respect to any of the foregoing used by Seller in the conduct
of the Business as presently conducted and previously conducted during the last
twelve (12) months (the foregoing being herein collectively referred to as
"Proprietary Rights"). Except as set forth on the Proprietary Rights Schedule,
- ------------------- ---------------------------
Seller owns, free and clear of all Liens, all right, title and interest in, and
has full right and authority to use, all Proprietary Rights listed on the
Proprietary Rights Schedule as owned by it indefinitely and Seller is duly
- ---------------------------
licensed to use all other Proprietary Rights listed thereon for the period
specified on the Proprietary Rights Schedule. Except as set forth on the
---------------------------
-29-
<PAGE>
Proprietary Rights Schedule, no claim by any other Person contesting the
- ---------------------------
validity or Seller's ownership of any of the Proprietary Rights has been made in
the past 12 months, is currently outstanding, and Seller has not received any
notices of, nor is it aware of any facts which indicate a likelihood of any
infringement or misappropriation by or conflict with, any other Person with
respect to the Proprietary Rights. To Seller's knowledge, the use of the
Proprietary Rights listed on the Proprietary Rights Schedule by Seller in the
---------------------------
Business does not conflict with, infringe upon or misappropriate any proprietary
rights of any other Person. The Proprietary Rights Schedule describes all
---------------------------
Proprietary Rights which have been licensed to other Persons and those
Proprietary Rights which are licensed from other Persons. The transactions
contemplated by this Agreement will have no material adverse effect on the
Seller's right, title and interest in and to any of the Proprietary Rights.
6.19 Litigation.
----------
(a) Except as disclosed on the Litigation Schedule attached hereto,
-------------------
with respect to the Business (i) there are no (and during the three years
preceding the date hereof there have not been any) material claims, actions,
proceedings (public or private) or governmental investigations pending or, to
the knowledge of Seller, threatened against or affecting Seller at law or in
equity, before or by any federal, state, or municipal court, agency or other
governmental entity, or by any private person, and (ii) there are no existing
or, to the knowledge of Seller, threatened orders, judgments or decrees of any
court or governmental agency. Without limiting the foregoing, except as
disclosed on the Litigation Schedule, since December 31, 1995, Seller has not
-------------------
received any written product liability claim with respect to any actual or
alleged injury to person or property as a result of the ownership, possession or
use of any product of the Business.
(b) With respect to the Business there are no legal, administrative,
or other proceedings or governmental investigations pending or, to the knowledge
of Seller, threatened against Seller which would give any third party the right
to enjoin or rescind the transactions contemplated hereby.
6.20 Product Warranty. Each product manufactured, distributed or
----------------
sold by Seller in connection with the Business at any time prior to the Closing
Date has been in conformity with all applicable contractual commitments and all
express or implied warranties. Prior to the date hereof, Seller has delivered
to Purchaser copies of Seller's standard terms and conditions of sale for
products delivered and services rendered by Seller (containing applicable
guarantee, warranty and indemnity provisions).
6.21 Environmental and Safety Matters. Except as set forth on the
--------------------------------
Environmental Schedule attached hereto, with respect to the Business:
- ----------------------
(a) Seller and its Subsidiaries are currently in compliance in all
material respects with all Environmental and Safety Requirements, and neither
Seller nor its Subsidiaries have received any written notice, report or
information regarding any material liabilities (whether accrued, absolute,
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contingent, unliquidated or otherwise) or any material corrective, investigatory
or remedial obligations arising under Environmental and Safety Requirements
which relate to the Owned Real Property, Purchased Assets or the Business.
(b) Without limiting the generality of the foregoing, Seller and its
Subsidiaries have obtained and are in compliance in all material respects with,
all permits, licenses and other
authorizations that are required pursuant to any Environmental and Safety
Requirements for the occupancy of the Owned Real Property or the operation of
the Business. A list of all such material permits, licenses and other
authorizations is set forth on the Environmental Schedule.
----------------------
(c) Neither this Agreement nor the consummation of the transactions
contemplated by this Agreement shall impose any obligations on Seller and its
Subsidiaries or otherwise for site investigation or cleanup, or notification to
or consent of any government agencies or third parties under any Environmental
and Safety Requirements (including, without limitation, any so called
"transaction-triggered" or "responsible property transfer" laws and
regulations).
(d) None of the following exists at the Owned Real Property:
(i) underground storage tanks or surface impoundments;
(ii) asbestos-containing materials in any form or condition; or
(iii) materials or equipment containing polychlorinated biphenyls.
(e) Neither Seller nor any of its Subsidiaries has treated, stored,
disposed of, arranged for or permitted the disposal of, transported, handled or
Released any substance (including, without limitation, any Hazardous Materials)
or owned, occupied or operated any facility or property, so as to give rise to
material liabilities of Seller or its Subsidiaries for response costs, natural
resource damages or attorneys fees pursuant to CERCLA or any other Environmental
and Safety Requirements.
(f) Without limiting the generality of the foregoing, no facts, events
or conditions relating to the past or present properties, facilities or
operations of the Business prior to the Closing shall prevent, hinder or limit
continued material compliance with Environmental and Safety Requirements, give
rise to any material corrective, investigatory or remedial obligations pursuant
to Environmental and Safety Requirements or give rise to any other material
liabilities (whether accrued, absolute, contingent, unliquidated or otherwise)
pursuant to Environmental and Safety Requirements (including, without
limitation, those liabilities relating to onsite or offsite Releases or
threatened Releases of Hazardous Materials, personal injury, property damage or
natural resources damage).
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(g) Neither Seller nor any of its Subsidiaries has, either expressly
or by operation of law, assumed or undertaken any liability or corrective,
investigatory or remedial obligation of any other Person relating to any
Environmental and Safety Requirements.
(h) Seller makes no representation or warranty concerning
environmental matters or Environmental and Safety Requirements other than those
contained in this Section 6.23 and Section 9.3.
(i) No Environmental Lien has attached to any property owned, leased
or operated by Seller or any of its Subsidiaries.
6.22 Indebtedness. As of the Closing Date, Seller shall not
------------
have any outstanding letters of credit, indebtedness or other obligation or
liability for, resulting from or in connection with indebtedness for borrowed
money of any Person, including without limitation any industrial development
revenue bond, guarantee, pledge or other similar financial accommodation, with
respect to or affecting the Purchased Assets or the Business that is required to
be assumed, replaced or maintained by Purchaser in order to continue to operate
the Business from and after the Closing (other than Ball's general corporate
financing arrangements, which shall not, in any case, affect the Purchased
Assets or the Business after the Closing).
6.23 Brokers. All negotiations relative to this Agreement and
-------
the transactions contemplated hereby have been carried out by Seller directly
with Purchaser, without the intervention of any Person (including, without
limitation, any broker) on behalf of Seller in such manner as to give rise to
any valid claim by any Person against Purchaser for a finder's fee, brokerage
commission, or similar payment.
6.24 Intercompany Services. The attached Intercompany Services
--------------------- ---------------------
Schedule describes all material intercompany services provided to or on behalf
- --------
of the Business by a business unit of Seller other than the Business.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser hereby represents and warrants to Seller as follows:
7.1 Due Incorporation, Etc. Purchaser is a corporation duly
----------------------
incorporated, validly existing and in good standing under the laws of the State
of Delaware.
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7.2 Authorization, No Conflicts, Etc. Purchaser has all requisite
---------------------------------
corporate power and authority to enter into this Agreement and to carry out the
transactions contemplated hereby. The execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated hereby by
Purchaser has been or prior to the Closing will be duly authorized by all
requisite corporate action of Purchaser. This Agreement has been duly executed
and delivered by Purchaser and (assuming the due authorization, execution and
delivery hereof by Seller) is a valid and binding obligation of Purchaser,
enforceable against it in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally, and subject, as to enforceability, to
general principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity). The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby by
Purchaser will not: (a) violate any provisions of law applicable to Purchaser;
(b) with or without the giving of notice and/or the passage of time, conflict
with or result in the breach of any provision of the Certificate of
Incorporation or Bylaws of Purchaser or any material instrument, license,
agreement, arrangement, indenture or commitment to which Purchaser is a party or
by which any of its assets or properties are bound; or (c) constitute a
violation of any order, judgment or decree to which Purchaser is a party or by
which any of its assets or properties are bound.
7.3 Consents and Approvals. The execution and delivery by Purchaser
-----------------------
of this Agreement does not, and compliance by Purchaser with the terms hereof
and consummation by Purchaser of the transactions contemplated hereby will not,
require Purchaser to obtain any consent, approval or action of, or make any
filing with or give any notice to, any Person other than as contemplated hereby
or those which will have been obtained, made or given on or prior to Closing.
7.4 Absence of Violations. Purchaser is not in violation of its
----------------------
Certificate of Incorporation or Bylaws, or in violation (or with or without
notice or lapse of time or both would be in violation), in any way of any term
or provision of any law, statute, ordinance, rule, regulation, order, writ,
judgment, injunction, permit, or decree applicable to it or any of its assets or
properties.
7.5 Legal Proceedings. There are no legal, administrative, or other
------------------
proceedings or governmental investigations pending or, to the best knowledge of
Purchaser, threatened, against Purchaser which would give any third party the
right to enjoin or rescind the transactions contemplated hereby.
7.6 Financial Ability to Perform. Purchaser has, and on the Closing
-----------------------------
Date and each other date that a payment to Seller becomes due hereunder will
have, sufficient funds and credit arrangements available to deliver the Cash
Purchase Price and any additional amounts payable by it hereunder on such dates,
to perform its obligations under the Transition Services Agreement and the
Supply Agreement and to take such other actions as may be required by it to
consummate the transactions contemplated hereby and thereby.
7.7 Brokers. All negotiations relative to this Agreement and the
--------
transactions contemplated hereby have been carried out by Purchaser directly
with Seller, without the intervention of any Person (including, without
limitation, any broker) on behalf of Purchaser in such manner as to give rise to
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any valid claim by any Person against Seller, for a finder's fee, brokerage
commission, or similar payment.
ARTICLE VIII
COVENANTS PRIOR TO CLOSING
8.1 Affirmative Covenants of Seller. Except as otherwise expressly
--------------------------------
provided herein or as expressly consented to in writing by Purchaser, prior to
the Closing, Seller shall with respect to the Business:
(a) collect accounts receivable and pay accounts payable only in the
ordinary course of business consistent with past practice and otherwise conduct
the Business only in the ordinary course of business and consistent with past
practice;
(b) preserve intact in all material respects its business organization
and goodwill, order inventory, equipment and services in amounts and at rates
consistent with past practice, use all reasonable efforts to keep available the
services of its employees to be employed by Purchaser after the Closing and
maintain satisfactory relationships with suppliers, customers and others having
material business relationships with the Business and otherwise act in the
interest of maintaining the Business;
(c) afford, and cause its officers, directors, employees, attorneys,
accountants and other agents to afford, to Purchaser and its accounting, legal
and other representatives, as well as their respective officers, employees,
affiliates and other agents, full and complete access at all reasonable times
and upon reasonable notice to the Owned Real Property and to Seller's and Ball's
personnel who have responsibility for the Business (including for the purpose of
interviewing each employee to determine who shall be employed by Purchaser) and
to business, financial, legal, tax, compensation and other data and information
concerning the Business and its affairs and operations;
(d) maintain the Purchased Assets in a manner consistent with prior
practice (which practice is generally consistent with industry practice),
maintain insurance covering the Purchased Assets or Assumed Liabilities
reasonably comparable to that in effect on the date of the August Balance Sheet,
maintain supplies and spare parts at customary operating levels consistent with
past practices, repair or replace in accordance with past practice any
inoperable or worn out operating Purchased Assets and, in the event of a
casualty, loss or damage to any of such Purchased Assets prior to the Closing
Date for which Seller is insured, either repair or replace such Purchased Assets
or, if Purchaser agrees, transfer the proceeds of such insurance to Purchaser;
(e) maintain its books, accounts and records in accordance with past
custom and practice;
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(f) maintain in full force and effect all Proprietary Rights included
in the Purchased Assets;
(g) give all notices required to be given by Seller and use all
reasonable efforts to obtain all authorizations, consents, licenses, permits and
approvals necessary to consummate the transactions contemplated hereby and to
permit Purchaser to operate the Business after the Closing (including with
respect to the matters set forth on the Consents Schedule attached hereto) and
-----------------
(to the extent within the control of Seller) to cause the other conditions to
Purchaser's obligation to close to be satisfied (including the execution and
delivery of all agreements contemplated hereunder to be so executed and
delivered);
(h) permit Purchaser and an environmental consultant selected by
Purchaser and reasonably acceptable to Seller to perform a Phase I environmental
assessment and, upon receipt of additional information reasonably indicating the
need for further investigation and with Seller's consent, a Phase II
environmental assessment with respect to the Owned Real Property pursuant to a
scope of work determined by Purchaser and reasonably acceptable to Seller, the
expense of which Purchaser shall pay. Section 5.1 shall not be satisfied, and
Purchaser shall be under no obligation to close the transactions contemplated by
this Agreement, if Seller unreasonably withholds consent to such Phase II
environmental assessments;
(i) cooperate with Purchaser to obtain the Title Insurance Policies
and Surveys in form and substance as set forth in Section 5.9 of this Agreement,
within the time periods set forth therein including, without limitation,
providing the Title Company with any affidavits, indemnities or other assurances
customary for the Title Company in Ohio and reasonably requested by the Title
Company to cause the Title Company to issue the Title Policy in the form
required under Section 5.9; and
(j) promptly inform Purchaser in writing of (i) any material breach by
Seller that becomes known to Seller of the representations and warranties
contained in Article VI hereof or any covenant hereunder by Seller and (ii) any
change that becomes known to Seller that, at the Closing Date, would cause
Seller not to satisfy the requirements of Section 5.1.
8.2 Negative Covenants of Seller. Except as otherwise expressly
-----------------------------
provided herein or as expressly consented to in writing by Purchaser, prior to
the Closing Date, Seller shall not with respect to the Business:
(a) sell, lease, license or otherwise dispose of any interest in any
of the Purchased Assets, or permit, allow or suffer any of the Purchased Assets
to be subjected to any mortgage, pledge, lien, encumbrance, restriction or
charge of any kind, other than any of the foregoing which shall be in existence
as of the date of this Agreement (all which shall be released, satisfied or
otherwise discharged as of the Closing Date, other than the Permitted
Encumbrances and Permitted Liens);
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(b) initiate any new promotional sales or discount or other activity
with customers that has or would reasonably be expected to have the effect of
accelerating to pre-Closing periods sales that would otherwise be expected to
occur in post-Closing periods;
(c) enter into, establish, amend, terminate or (except as required by
the express terms thereof) make any contribution to any employee pension benefit
plan or any employee welfare benefit plan (as described in Section 10.2) which
covers Transferred Employees;
(d) terminate or modify any Assumed Contract, Material Contract or any
government license, permit or other authorization;
(e) enter into any new contracts, agreements or commitments that, if
entered into prior to the date hereof, would be Material Contracts hereunder,
other than in the ordinary course of business;
(f) institute any material change in the conduct of the Business, or
any material change in its method of purchase, sale, marketing, distribution,
operation or accounting;
(g) make any capital expenditures or any commitments therefor in
excess of $10,000 in any single transaction or in excess of $50,000 in the
aggregate other than the Capital Expenditure Amount; or
(h) take any other action that, if taken before the date hereof, would
require disclosure pursuant to Section 6.13 hereof.
8.3 Exclusivity.
-----------
(a) Neither Seller nor Ball shall, directly or indirectly, through any
officer, director, employee, agent or otherwise (including through any
investment banker, attorney or accountant retained by any of the foregoing),
solicit, initiate or encourage the submission of any proposal or offer from any
person or entity (including any of such person's or entity's officers,
directors, employees, agents or other representatives) relating to any
acquisition of any Purchased Assets, or participate in any discussions or
negotiations regarding, or furnish to any other person or entity any information
with respect to, or otherwise cooperate in any way with, or assist or partici
pate in, pursue, facilitate or encourage any effort or attempt by any other
person or entity to do or seek to do any of the foregoing. Each of Seller and
Ball shall immediately cease and cause to be terminated any and all contacts,
discussions and negotiations with third parties regarding any of the foregoing.
Seller and Ball shall promptly notify Purchaser if any proposal with respect to
the foregoing, or any inquiry or contact with any person or entity with respect
thereto, is made.
(b) In the event that Seller of Ball breaches the provisions of this
Section 8.3 and the transactions contemplated hereby are not consummated, Seller
or Ball shall promptly reimburse Purchaser and its affiliates for all out-of-
pocket fees and expenses incurred before or after the date of this Agreement by
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Purchaser and its affiliates related to the transactions contemplated hereby,
including fees and expenses of legal counsel, accountants and other consultants
and advisors retained by Purchaser. The foregoing provisions are in addition
to, and not in derogation of, any other remedy (including any statutory remedy)
that Purchaser may have for a breach of this Section 8.3.
8.4 Investigation by Purchaser and Confidentiality.
----------------------------------------------
(a) Seller shall allow Purchaser and its representatives, during
regular business hours and upon reasonable notice, to make such investigation of
the business, properties, employees, auditors, books and records of the Business
and to conduct such examination of the financial condition, customer, employee
and supplier relations and other aspects of the Business, as Purchaser deems
necessary or advisable to familiarize itself with such business, properties,
books, records, financial condition and other matters.
(b) Purchaser and its associates and Affiliates will, and will cause
their authorized representatives to, hold in strict confidence all nonpublic
information received by them from Seller in connection with the transactions
contemplated hereby, and will not (and will use best efforts to ensure that such
authorized representatives do not) disclose such information to others without
the prior written consent of Seller, except that: (i) Purchaser may provide such
confidential information in response to legal process or applicable governmental
regulations, provided that Purchaser forthwith notify Seller of its obligation
to provide such confidential information and fully cooperates with Seller to
protect the confidentiality of such information (and Seller may at its option
and expense and in the name and with the consent of Purchaser bring any suit or
administrative action to enforce its aforesaid rights and Purchaser shall at
Seller's expense assist Seller as reasonably requested by Seller); and (ii)
Purchaser may, after prior notice to Seller, provide such information to third
parties in connection with the financing of the transactions contemplated
hereby, provided that such persons agree to hold such information confidential
in the manner described above. If this Agreement is terminated, Purchaser will
destroy or return promptly or cause to be returned promptly to Seller all
tangible evidence of such confidential information (including any materials
prepared by Purchaser that incorporate confidential information) which has been
furnished by Seller to Purchaser or its associates, Affiliates, or authorized
representatives, or by Purchaser to third parties. The provisions of this
Section 8.4(b) shall not apply to information which is publicly available (other
than as a result of a breach by Purchaser of any confidentiality agreement), is
obtained by Purchaser or its Affiliates from a third party (without violation of
any confidentiality agreement with Seller) or which is developed independently
by Purchaser or its Affiliates. Furthermore, the provisions of this Section
8.4(b) shall cease to be of effect following the Closing.
8.5 Further Actions. Subject to the terms and conditions herein
----------------
provided, Seller and Purchaser covenant and agree to use their reasonable best
efforts to take, or cause to be taken, all action, or do, or cause to be done,
all things, necessary, proper or advisable under applicable laws and regulations
to satisfy the conditions and consummate and make effective the transactions
contemplated by this Agreement.
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<PAGE>
8.6 Hart-Scott-Rodino Act. As soon as practicable after the date of
----------------------
this Agreement, the parties hereto will each make filings, if any, as required
under the Hart-Scott-Rodino Act. Each will furnish to the other such necessary
information and reasonable assistance as the other may request in connection
with its preparation of the initial filing and any additional necessary filings
or submissions to any governmental agency, including, without limitation, any
additional filings necessary under the Hart-Scott-Rodino Act. The parties shall
keep each other apprised of the status of any communications with, and inquiries
or requests for additional information from, the Federal Trade Commission, the
Antitrust Division of the U.S. Department of Justice or any other governmental
agency or authority or members of their respective staffs with respect to this
Agreement or the transactions contemplated hereby. The parties shall use their
respective best efforts to obtain as promptly as possible any clearance required
under the Hart-Scott-Rodino Act for the purchase and sale of the Purchased
Assets. Without limiting the generality of the foregoing, the parties hereto
agree to respond promptly and fully to all government inquiries as soon as
practicable.
ARTICLE IX
COVENANTS AFTER CLOSING
9.1 Survival of Representations and Warranties. The representations
------------------------------------------
and warranties in this Agreement and the Schedules and Exhibits hereto shall
survive the Closing until January 1, 1998, except that the representations and
warranties contained in Sections 6.4 and 6.6 shall survive until January 1, 1999
and the representations and warranties contained in Sections 6.3, 6.16(a) and
6.17 shall survive indefinitely regardless of any investigation made by or on
behalf of Purchaser or the knowledge of Purchaser or any of its Affiliates or
agents, it being understood and acknowledged that Purchaser is relying upon the
Seller's covenants, representations and warranties to be induced to pay the
Purchase Price and consummate the transactions hereunder. The representations
and warranties contained in Section 6.21 shall not survive the Closing.
9.2 General Indemnification.
-----------------------
(a) Indemnification for Benefit of Purchaser. Ball and Seller shall
----------------------------------------
jointly and severally indemnify Purchaser and its Affiliates, stockholders,
officers, directors, employees, agents, representatives, successors and
permitted assigns (collectively, the "Purchaser Parties") and save and hold each
-----------------
of them harmless against and pay on behalf of or reimburse such Purchaser
Parties as and when incurred for any loss, liability, demand, claim, action,
cause of action, cost, damage, deficiency, tax, penalty, fine or expense,
whether or not arising out of third party claims (including interest, penalties
and reasonable attorneys', consultants' and other experts' fees and expenses,
all amounts paid in settlement and all reasonable amounts paid in investigation
or defense of any of the foregoing) and enforcement of its rights hereunder
(collectively, "Losses") which any such Purchaser Party may suffer, sustain or
------
become subject to, as a result of, in connection with, relating or incidental to
or by virtue of:
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(i) any breach of a representation or warranty under Article VI
(other than Section 6.21) or Article X of this Agreement, or in any of the
certificates furnished to Purchaser by Seller or Ball pursuant to this Agreement
(in each case, ignoring for purposes of determining the inaccuracy or breach
thereof and the amount of Losses relating thereto any qualification as to
materiality contained in such representation or warranty);
(ii) any nonfulfillment or breach of any covenant, agreement or
other provision by Seller or Ball under this Agreement or the Schedules and
Exhibits hereto;
(iii) any liability or obligation of Seller or Ball with respect
to the Retained Liabilities and other liabilities of Seller or Ball arising from
other businesses that are not the Business; or
(iv) any liability or obligation imposed on Purchaser or any of
its Affiliates as a transferee of the Business or the Owned Real Property,
except to the extent such liability is an Assumed Liability.
(b) Indemnification for Benefit of Seller. Purchaser shall indemnify
--------------------------------------
Seller and its Affiliates, stockholders, officers, directors, employees, agents,
representatives, successors and permitted assigns (collectively, the "Seller
------
Parties") and hold them harmless against any Losses which the Seller Parties may
- --------
suffer, sustain or become subject to, as the result of, in connection with,
relating or incidental to or by virtue of:
(i) any breach of a representation or warranty under Article VII
or Article X of this Agreement, or in any of the certificates or other
instruments or documents furnished to Seller by Purchaser pursuant to this
Agreement (in each case ignoring for purposes of determining the inaccuracy or
breach thereof and the amount of Losses relating thereto any qualification as to
materiality contained in such representation or warranty);
(ii) any nonfulfillment or breach of any covenant, agreement or
other provision by Purchaser under this Agreement or the Schedules and Exhibits
hereto;
(iii) any liability or obligation of Purchaser with respect to any
Assumed Liability; or
(iv) the arrangements with respect to the Collective Bargaining
Agreement or the Ball Pension Plan as set forth in Section 10.3 hereof
(including the Additional Pension Liabilities but excluding the liabilities
defined as Retained Liabilities under Section 10.4 hereof); provided, however,
-------- -------
that Purchaser shall not be required to indemnify the Seller Parties with
respect to any Losses incurred as a result of Seller's investment experience,
investment policies, actuarial assumptions, failure to comply with any provision
of the Ball Pension Plan (other than any change thereto caused by Purchaser) or
failure to comply with Laws relating thereto.
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<PAGE>
(c) Manner of Payment. The amount of any indemnification payments
-----------------
due to the Purchaser Parties or the Seller Parties pursuant to Article IX that
are not in dispute shall be effected by wire transfer of immediately available
funds from Seller, Ball or Purchaser, as the case may be, to an account
designated by Purchaser or Seller, as the case may be, within 5 days after the
determination thereof. Upon a final determination with respect to any disputed
portion of an indemnification pursuant to this Article IX, such remaining
payments shall be effected in the manner described in the preceding sentence.
(d) Defense of Third Party Claims. Any party making a claim for
-----------------------------
indemnification under this Section 9.2 or Section 9.3 below (an "Indemnitee")
----------
shall notify the indemnifying party (an "Indemnitor") of the claim in writing
----------
promptly after receiving written notice of any action, lawsuit, proceeding,
investigation or other claim against it (if by a third party), describing the
claim, the amount thereof (if known and quantifiable), and the basis thereof;
provided that the failure to so notify an Indemnitor shall not relieve the
- -------- ----
Indemnitor of its obligations hereunder except to the extent that (and only to
the extent that) such failure shall have caused the damages for which the
Indemnitor is obligated to be greater than such damages would have been had the
Indemnitee given the Indemnitor prompt notice hereunder. Any Indemnitor shall
be entitled to participate in the defense of such action, lawsuit, proceeding,
investigation or other claim giving rise to an Indemni tee's claim for
indemnification at such Indemnitor's expense, and at its option (subject to the
limitations set forth below) shall be entitled to assume the defense thereof
provided that it appoint a reputable counsel reasonably acceptable to the
Indemnitee to be the lead counsel in connection with such defense; provided
--------
further that, prior to the Indemnitor assuming control of such defense it shall
- -------
first verify to the Indemnitee in writing that such Indemnitor shall be fully
responsible (with no reservation of any rights) for all liabilities and
obligations relating to the entire matter which gives rise to such claim for
indemnification and that it will provide full indemnification (whether or not
otherwise required hereunder) to the Indemnitee with respect to such matter,
action, lawsuit, proceeding, investigation, or other claim giving rise to such
claim for indemnification hereunder; and provided further, that:
-------- -------
(i) the Indemnitee shall be entitled to participate in the defense
of such claim and to employ counsel of its choice for such purpose; provided
--------
that the fees and expenses of such separate counsel shall be borne by the
Indemnitee (other than any fees and expenses of such separate counsel that are
incurred prior to the date the Indemnitor effectively assumes control of such
defense which, notwithstanding the foregoing, shall be borne by the Indemnitor);
(ii) the Indemnitor shall not be entitled to assume control of
such defense and shall pay the fees and expenses of counsel retained by the
Indemnitee if (A) the claim for indemnification relates to or arises in
connection with any criminal proceeding, action, indictment, allegation or
investigation; (B) the Indemnitee reasonably believes the action, lawsuit,
investigation, proceeding or other claim giving rise to such claim for
indemnification would be detrimental to or injure the Indemnitee's reputation or
future business prospects; (C) the claim seeks an injunction or equitable relief
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<PAGE>
against the Indemnitee; or (D) upon petition by the Indemnitee, the appropriate
court rules that the Indemnitor failed or is failing to vigorously prosecute or
defend such claim; and
(iii) if the Indemnitor shall control the defense of any such
claim, the Indemnitor shall obtain the prior written consent of the Indemnitee
(which shall not be unreasonably withheld) before entering into any settlement
of a claim or ceasing to defend such claim if, pursuant to or as a result of
such settlement or cessation, injunctive or other equitable relief will be
imposed against the Indemnitee or if such settlement does not expressly and
unconditionally release the Indemnitee from all liabilities and obligations with
respect to such claim, without prejudice. Notwithstanding the foregoing, if the
Indemnitee is controlling the defense of the claim, the Indemnitor shall not be
liable for any settlement effected without its prior written consent (which
shall not be unreasonably withheld).
(e) Limitation of Claims. Notwithstanding the foregoing, (i) with
---------------------
respect to Losses incurred by Purchaser under Section 9.2(a)(i) above, Seller
shall be required to indemnify and hold Purchaser harmless only with respect to
any such Loss that individually (or together with other indivdual items that
arise out of the same facts) exceeds $10,000 and only if the aggregate amount of
all such Losses exceeds $300,000, in which case, Seller shall indemnify
Purchaser for one half of all Losses up to such $300,000 amount and for all
Losses thereafter, and (ii) with respect to Losses incurred by Seller under
Section 9.2(b)(i) above, Purchaser shall be required to indemnify and hold
Seller harmless only with respect to any such Loss that individually (or
together with other indivdual items that arise out of the same facts) exceeds
$10,000 and only if the aggregate amount of all such Losses exceeds $300,000, in
which case Purchaser shall indemnify Seller for one half of all Losses up to
such $300,000 amount and for all Losses thereafter. The provisions of this
Section 9.2(e) do not limit in any way the indemnification rights set forth in
Section 9.3, but any Losses incurred by Purchaser for which Purchaser is
responsible pursuant to Section 9.3(d)(ii) shall be applied to satisfying the
requirement in (i) above for purposes of determining Purchaser's right to
indemnification for other Losses under Section 9.2(a).
(f) Adjustment for Insurance and Taxes. The amount which an
------------------------------------
Indemnitor is required to pay to, for or on behalf of an Indemnitee pursuant to
this Section 9.2 or Section 9.3 hereof shall be adjusted (including, without
limitation, retroactively) (i) by any insurance proceeds actually paid to such
Indemnitee in reduction of the related Loss (net of any increased premium) and
(ii) (A) reduced by the amount of any Tax benefit actually received by the party
seeking indemnification as a result of the Loss, and (B) increased by the
present value of the amount of any Tax due with respect to the indemnification
payment itself. Amount required to be paid, as so adjusted, are hereafter
sometimes called an "Indemnity Payment." If an Indemnitee shall have received
-----------------
or shall have paid on its behalf an Indemnity Payment in respect of a Loss and
shall subsequently receive insurance proceeds in respect of such Loss, or
realize any net Tax benefit (as computed in clause (ii) above) as a result of
such Loss, then the Indemnitee shall pay to the Indemnitor the amount of such
insurance proceeds or net tax benefit or, it lesser, the amount of the Indemnity
Payment.
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9.3 Environmental Indemnification.
-----------------------------
(a) By Seller and Ball. The Seller Parties shall jointly and severally
------------------
indemnify the Purchaser Parties and save and hold each of them harmless against
and pay on behalf of or reimburse such party as and when incurred for any Losses
(including without limitation any liability for personal injury, property
damage, onsite cleanup costs, or damage to natural resources, and any obligation
to investigate or remediate contamination of land, surface water or ground water
and irrespective of whether or not set forth on the Environmental Schedule
----------------------
hereto) which any Purchaser Party may suffer, sustain or become subject to as a
result of, in connection with, incidental to, or by virtue of:
(i) any matter set forth on the attached Environmental
-------------
Indemnification Schedule;
- ------------------------
(ii) any claim, demand, or notice by any federal, state, or local
government or any other third party with respect to any violations of, or any
liabilities or investigative, remedial or corrective action obligations
resulting from or arising under, any Environmental and Safety Requirements and
relating to the status or condition of the Owned Real Property or the Purchased
Assets prior to the Closing (including without limitation the ownership or
operation of the Owned Real Property or the Purchased Assets by prior owners or
operators); and
(iii) any affirmative legal obligation or requirement to conduct
investigative, remedial or corrective action resulting from or arising under
Environmental and Safety Requirements and relating to the status or condition of
the Owned Real Property or the Purchased Assets prior to the Closing (including
without limitation the ownership or operation of the Owned Real Property or the
Purchased Assets by prior owners or operators), whether or not resulting out of
a claim, demand, or notice by a third party or government body.
in each such case above, except to the extent such Losses are caused or
increased by Purchaser's conduct in connection with the ownership or operation
of the Business or the Owned Real Property and Purchased Assets after the
Closing Date.
(b) By Purchaser. Purchaser shall indemnify the Seller Parties and
------------
save and hold each of them harmless against and pay on behalf of or reimburse
such party as and when incurred for any Losses which any such party may suffer,
sustain or become subject to as a result of, in connection with, incidental to
or by virtue of any violations of, or liabilities or corrective or remedial
obligations arising under, any Environmental and Safety Requirements and
relating to the conduct of the Business, or the ownership or operation of the
Owned Real Property, if, and only to the extent, such Losses are caused by such
conduct, ownership or operation by the Purchaser after the Closing Date,
including any liability for personal injury, property damage, onsite or offsite
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cleanup costs, or damage to natural resources, and any obligation to
investigate, remediate, or otherwise address contamination of land, surface
water, or ground water.
(c) Certain Procedures Relating to Environmental Indemnification.
-------------------------------------------------------------
Any claim for indemnification pursuant to this Section 9.3 that is in the nature
of an action, lawsuit, proceeding, investigation or claim by a third party (a
"Third Party Claim") shall be governed by the procedures set forth in Section
-----------------
9.2(d) hereof as well as the procedures set forth below; any inconsistency
between such procedures shall be resolved in favor of the procedures set forth
below. Either party may make a claim for indemnification against the other party
under this Section 9.3 (whether or not arising from a Third Party Claim) by
giving notice of the claim in writing, promptly upon learning of the existence
of such claim, which notice shall describe in reasonable detail the nature of
the claim and the facts giving rise to such claim; provided that the failure of
one party to give such notice to the other party shall not relieve such other
party of its obligations hereunder to the extent of actual prejudice resulting
therefrom. Notice shall hereby be deemed given by Purchaser to the Seller
Parties with respect to all matters set forth on the Environmental
-------------
Indemnification Schedule. Upon delivery of any notice of a claim for
- ------------------------
indemnification hereunder, the parties agree to promptly negotiate in good faith
over the subject matter of the claim in an effort to arrive at a mutually
satisfactory resolution of the subject matter of the claim. If, as to any
particular negotiation, the parties are unable to arrive at a mutually
satisfactory resolution within 30 days (or such shorter period as exigent
circumstances warrant as described in the notice of claim or such longer period
to which the parties may mutually agree) of the receipt of notice of such claim,
the parties agree to submit any issues in dispute to a mutually agreed upon
environmental professional (which professional may be an environmental lawyer,
environmental consultant, or other expert as appropriate based on the nature of
the controversy) for resolution, which resolution shall include an allocation of
the cost associated with such dispute resolution and shall be binding upon the
parties (subject to the parties' right to mutually agree upon an alternate
resolution). In resolving any dispute hereunder, the environmental professional
shall select a resolution which (i) reasonably attains compliance with all
Remediation Requirements (as defined below), including without limitation any
lawful order or directive of any governmental authority; (ii) does not
unreasonably interfere in any material respect with Purchaser's operation of its
Business; and (iii) allows Purchaser to operate the Business in substantially
the same manner and at substantially the same level of production as operated by
Seller and Ball prior to Closing. For purposes of this Section, "Remediation
-----------
Requirements" shall mean Environmental and Safety Laws in effect on the earlier
- ------------
of (i) the date of the remediation or (ii) the most stringent Environmental and
--
Safety Laws in effect on or before the sixth anniversary of the Closing Date.
The parties agree to act in good faith and in a commercially reasonable manner
in connection with addressing any claim hereunder. Activities conducted
hereunder shall be conducted promptly and concluded expeditiously using
commercially reasonable efforts, subject to any schedules and approvals required
by governmental authorities.
(d) Allocation of Environmental Liabilities.
---------------------------------------
(i) in the event either party incurs any Loss for which
indemnification is sought under Section 9.3(a), which Loss was caused or
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increased in magnitude by the conduct of the Business or the ownership or
operation of the Owned Real Property, both prior to and after the Closing Date,
---
and in the event the proportion in which the fact, event or condition giving
rise to such Loss resulted from actions, omissions or conditions prior to or
after the Closing cannot be reasonably ascertained, the parties agree to share
all such Losses, including any associated remediation costs, and to indemnify
and hold harmless one another under this Section 9.3, in amounts to be
determined by an environmental professional (to be selected according to the
procedures set forth in Section 9.3(c), above) and based upon the estimated
relative contribution to the condition giving rise to the claim for indemnity,
as between Purchaser and Seller (and all predecessors of Seller), and taking
into account all facts and circumstances known or reasonably ascertainable to
such environmental professional. In the event the extent to which the fact,
event, or condition giving rise to such Loss was caused both prior to and after
the Closing Date can be reasonably ascertained, Seller and Ball shall be
---
responsible for indemnifying the Purchaser Parties to the extent such fact,
event or condition was caused prior to the Closing Date, and Purchaser shall be
responsible for indemnifying the Seller Parties to the extent such fact, event
or condition was caused after the Closing Date. The following matters shall be
conclusively deemed to have been caused prior to the Closing Date for purposes
hereof: (A) all matters set forth on the Environmental Indemnification Schedule
--------------------------------------
attached hereto; (B) the listing, status or designation of the Owned Real
Property on the federal Comprehensive Environmental Response, Compensation and
Liability Information System ("CERCLIS") list or any analogous list promulgated
-------
by the State of Ohio and the issues, status or conditions identified in any
assessment relating thereto that occurred prior to the date hereof; and (C) the
listing or designation of the Owned Real Property as a "medium priority" site on
the federal Resource, Conservation and Recovery Act ("RCRA") Corrective Action
----
List and any analogous list promulgated by the State of Ohio and the issues,
status or conditions identified in any assessment relating thereto that occurred
prior to the date hereof.
(ii) with respect to any Losses for which indemnity is sought by
Purchaser pursuant to Sections 9.3(a)(ii) and 9.3(a)(iii), above, Seller's and
Ball's share of liability shall be as follows: (A) Seller and Ball shall be
required to indemnify Purchaser Parties for 100% of all such indemnifiable
Losses, up to an aggregate amount of $300,000 (it being understood by the
parties that Seller and Ball shall be responsible for 100% of the first $100,000
in costs associated with the items described in Sections 9.3(d)(i)(B) and (C),
above, without regard to any other limitation set forth in this Agreement and
that such first $100,000 shall not otherwise be considered in determining
whether aggregate amounts set forth in Sections 9.3(d)(ii)(B) and (C) below have
been reached) ; (B) Seller and Ball shall be required to indemnify Purchaser
Parties for 80% of all such indemnifiable Losses to the extent the aggregate
amount of all such Losses exceeds $300,000 but is less than or equal to
$3,300,000; and (C) Seller and Ball shall be required to indemnify Purchaser
Parties for 65% of all such indemnifiable Losses to the extent the aggregate
amount of all such Losses exceeds $3,300,000.
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(iii) the allocation of responsibility set forth in Sections
9.3(d)(i) and 9.3(d)(ii), above, is to be determined by the parties after good
faith negotiation, subject to the dispute resolution procedures set forth in
Section 9.3(c), such determination to be made and committed to writing after
appropriate environmental investigations have been concluded but prior to the
--------
implementation of any remedial activities determined to be necessary.
(iv) any Losses shared by Purchaser Parties solely as a result of
the cost allocation set forth in Section 9.3(d)(ii) above, shall be subtracted
from the aggregate "basket" amount required to be satisfied by Purchaser for
purposes of general indemnification under the provisions set forth in Section
9.2(e)(i), herein.
(e) Control of Remediation. Subject to the dispute resolution
----------------------
procedures set forth in Section 9.3(c), above, if the investigation,
remediation, or other action for which indemnity is sought pursuant to this
Section 9.3 involves any matter for which Seller is responsible for the larger
percentage of the Loss, Seller shall have the right to assume control over and
responsibility for conducting and completing the investigation or remediation,
subject to reasonable consultation with Purchaser, Purchaser's right to take
appropriate action to respond to emergency conditions, and Purchaser's right to
approve material actions (such approval not to be unreasonably withheld or
delayed). Seller shall retain the right to control such matters providing it
diligently and timely commences and promptly performs and completes such
activities in compliance with any and all applicable laws. In the event Seller
does not within a reasonable time, or is not entitled to, assume control over
any matter hereunder, Purchaser shall assume such control.
(f) Survival. The indemnities set forth in this Section 9.3 shall
--------
survive the Closing until the fifteenth anniversary of the Closing Date, after
-----
which date Seller Parties, Ball and Purchaser shall have no obligation to
indemnify each other with respect to any matters addressed under this Section
9.3 except for those with respect to which notice of a claim hereunder was
provided prior to such date (as to which such obligation shall survive until the
final resolution of such claim).
9.4 Exclusive Remedy. The foregoing indemnification provisions shall
----------------
be the exclusive remedy that the Purchaser Parties or the Seller Parties have
with respect to any disputes relating to this Agreement, the events giving rise
to this Agreement and the transactions provided for herein or contemplated
hereby.
9.5 Liability for Taxes. Seller shall retain and be solely
-------------------
responsible for, and Purchaser shall not assume, (a) any liability or obligation
of any Seller Party with respect to any Taxes imposed upon or measured by the
income allocable to the Purchased Assets for any period prior to the Closing
Date, (b) any liability or obligation for any Taxes imposed by reason of the
sale or conveyance of the Purchased Assets to Purchaser (other than as otherwise
provided in Section 9.8(a)), it being understood and agreed that Purchaser shall
not be deemed to be Seller's transferee with respect to any Tax liability and
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<PAGE>
(c) any Tax relating to the ownership or status of the Purchased Assets prior to
the Closing Date.
9.6 Non-Compete. Each of Ball and Seller agrees that during the
-----------
period beginning on the Closing Date and ending on the fifth anniversary of the
Closing Date, neither it nor any of its Affiliates will directly or indirectly
engage or participate in the manufacturing, marketing, distribution or sale of
metal aerosol containers anywhere in North America; provided that nothing herein
will prevent the Seller or its Affiliates from owning in the aggregate not more
than 5% of the outstanding stock of any class of a corporation which is publicly
traded, so long as neither Seller nor any Affiliate has any direct participation
in the management of such corporation; provided further that if any portion of
this Section shall be held invalid, illegal or unenforceable by any court,
arbitrator or panel, there shall be added automatically as part of this Section
a valid, legal and enforceable provision as similar in terms to such invalid,
illegal or unenforceable provision as may be possible.
9.7 Further Transfers. On or after the Closing, Seller shall execute
-----------------
and deliver such further instruments of conveyance and transfer and take such
additional action as Purchaser may reasonably request to effect, consummate,
confirm or evidence the transfer to Purchaser of the Purchased Assets, the
assumption by Purchaser of the Assumed Liabilities and the conduct by Purchaser
of the Business (including with respect to obtaining and maintaining all
licenses, permits, authorizations, accreditations and consents necessary or
desirable in connection therewith).
9.8 Certain Tax Matters.
-------------------
(a) Sales and Transfer Taxes. All sales, use, occupation and similar
------------------------
Taxes imposed as a result of the sale and transfer of the Purchased Assets
(other than the Owned Real Property) contemplated hereby shall be paid by
Purchaser. All transfer Taxes with respect to the transfer of the Owned Real
Property shall be split equally between Purchaser and Seller. Purchaser and
Seller shall cooperate in timely making all filings, returns, reports and forms
as may be required to comply with the provisions of applicable law in connection
with the payment of any such sales and transfer taxes, and Purchaser and Seller
shall cooperate in good faith to minimize, to the fullest extent possible, the
amount of any sales or transfer taxes payable in connection with the sale and
transfer of the Purchased Assets hereunder.
(b) Tax Cooperation. Seller and Purchaser agree to furnish or cause
---------------
to be furnished to each other, upon request, as promptly as practicable, such
information and assistance relating to the Purchased Assets and the Business
(including, without limitation, access to books and records) as is reasonably
necessary for the filing of all Tax returns, the making of any election related
to Taxes, the preparation for any audit by any taxing authority, and the
prosecution or defense of any claim, suit or proceeding relating to any Tax
return. Seller and Purchaser shall retain all books and records with respect to
Taxes pertaining to the Purchased Assets for a period of at least six years
following the Closing Date. At the end of such period, each party shall provide
the other with at least ten days prior written notice before destroying any such
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books and records, during which period the party receiving such notice can elect
to take possession, at its own expense, of such books and records. Seller and
Purchaser shall cooperate with each other in the conduct of any audit or other
proceeding related to Taxes involving the Business.
(c) Purchase Price Allocation. For purposes of allocating the
-------------------------
Purchase Price pursuant to Section 1060 of the IRC, Seller and Purchaser agree
that the fair market value of the Owned Real Property is $6,140,000, as set
forth on Annex A hereto. Seller and Purchaser shall not, nor shall they permit
their respective Affiliates to, take a federal or state income Tax position with
taxing or other public authorities in any jurisdiction that is inconsistent with
the allocation prescribed in this section. Seller and Purchaser shall also
cooperate with each other in meeting the requirements of Section 1060 of the
Code and shall each file I.R.S. Form 8594 in accordance with applicable rules
and regulations.
(d) Bulk Sales Indemnity. Each party hereto hereby waives compliance
--------------------
with the provisions of the "bulk sales", "bulk transfer" or similar laws of any
state. Seller agrees to indemnify and hold Purchaser harmless against any and
all claims, losses, damages, liabilities (including Tax liabilities), costs and
expenses incurred by Purchaser as a result of any failure to comply with any
such "bulk sales", "bulk transfer" or similar laws.
9.9 Regulatory Compliance Cooperation. Following the Closing, Seller
---------------------------------
and Purchaser shall cooperate with each other and provide each other with all
information and documentation reasonably necessary to (i) permit the preparation
and filing of all documentation required to be filed with the Securities and
Exchange Commission or any state securities commission and (ii) permit the
preparation and filing of any documentation required by any other regulatory
authority. Such cooperation shall include, but not be limited to, access to the
books and records of such party relating to the Business, delivery of historical
financial statements, and access to personnel, it being understood and agreed
that each party shall reimburse the other party for such party's reasonable out-
of-pocket expenses in connection therewith.
9.10 Collection of Closing Accounts Receivable.
-----------------------------------------
(a) After the Closing, Purchaser shall use commercially reasonable
efforts in accordance with Purchaser's past practices to collect the accounts
receivable which are reflected on the Statement of Adjustments (the "Closing
-------
Accounts Receivable"). For the purpose of determining amounts collected by
- -------------------
Purchaser with respect to the Closing Accounts Receivable, (A) if a payment is
specified by an account debtor as being in payment of a specific invoice of
Purchaser or Seller, as the case may be, the payment shall be applied to that
invoice and (B) all payments by an account debtor that are not specified as
being in payment of a specific invoice (following Purchaser's inquiry as to how
such payments shall be applied) shall first be applied to the oldest outstanding
invoice due from that account debtor. Purchaser shall not be required to bring
any suit or take any other action out of the ordinary course of business to
collect any of the Closing Accounts Receivable.
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(b) Seller shall, on the 150th day following the Closing Date,
repurchase from Purchaser any of the Closing Accounts Receivable which have not
been fully collected (taking into account the allowance for doubtful accounts
included in the accounts receivable reflected on the Statement of Adjustments)
as of such date for an amount equal to the uncollected balance thereof as of the
date of repurchase. Purchaser shall assist Seller, using commercially
reasonable efforts in accordance with Seller's past practices to collect any
Closing Accounts Receivable following Seller's repurchase thereof.
(c) In the event that prior to any repurchase by Seller of any Closing
Accounts Receivable, Seller shall receive any remittance from or on behalf of
any account debtor with respect to such Closing Accounts Receivable, Seller
shall endorse without recourse such remittance to the order of Purchaser and
forward such remittance to Purchaser promptly upon receipt thereof.
(d) In the event that after any repurchase by Seller of any Closing
Accounts Receivable, Purchaser shall receive any remittance from or on behalf of
any account debtor with respect to such Closing Accounts Receivable, Purchaser
shall endorse without recourse such remittance to the order of Seller and
forward such remittance to Seller promptly upon receipt thereof.
9.11 Sale of Inventory.
-----------------
(a) After the Closing, Purchaser shall use commercially reasonable
efforts in accordance with Purchaser's past practices to sell the Inventory
which is reflected on the Statement of Adjustments (the "Closing Inventory").
-----------------
For the purpose of determining Inventory sold by Purchaser with respect to the
Closing Inventory, fungible Inventory shall be considered sold on a first-in
first-out basis, and non-fungible Inventory shall be tracked on a piece-by-piece
basis. Purchaser shall not be required to take any extraordinary action or offer
price discounts to induce customers to purchase Inventory.
(b) Seller shall, on the 45th day following the Closing Date,
repurchase from Purchaser any of the raw material included in the Closing
Inventory which is damaged, obsolete or slow-moving. Seller shall, on the 180th
day following the Closing Date, repurchase from Purchaser any of the finished
products included in the Closing Inventory (as well as any finished product
finally assembled from any work-in-progress included in the Closing Inventory)
which was not sold by Purchaser and any obsolete, damaged or slow-moving work-
in-progress in each case included in the Closing Inventory (in each case net of
the allowance for obsolete or slow-moving inventory included in Inventory or the
Statement of Adjustments) as of such date for an amount equal to the book value
thereof as of the Closing Date. If Purchaser and Seller agree that such unsold
Closing Inventory shall stay in the possession of Purchaser, Purchaser shall
continue to use commercially reasonable efforts in accordance with Purchaser's
past practices to sell any Closing Inventory following Seller's repurchase
thereof.
(c) In the event that after any repurchase by Seller of any Closing
Inventory, Purchaser shall receive any remittance from or on behalf of the sale
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of any Closing Inventory, Purchaser shall endorse without recourse such
remittance to the order of Seller and forward such remittance to Seller promptly
upon receipt thereof.
9.12 Audit. Seller shall cause Price Waterhouse LLP to prepare
-----
an Audit of the Business for the 9-month period ended September 30, 1996.
Seller shall use its best efforts to cause such Audit to be delivered within 60
days after Closing. Seller shall be solely responsible for the payment of all
costs and expenses incurred in connection with such Audit exclusive of
Purchaser's internal costs of assisting in such Audit.
ARTICLE X
EMPLOYEE MATTERS
10.1 Representation With Respect to Employees.
----------------------------------------
As an inducement to Purchaser to enter into this Agreement, each of
Seller and Ball hereby represents and warrants to Purchaser as follows.
(a) Seller has provided Purchaser with a true, complete and accurate
list (a copy of which is attached hereto as part of the Employees Schedule) of
each employee of the Business, his or her date(s) of hire by Seller, position
and title (if any), current rate of compensation (including bonuses, commissions
and incentive compensation, if any), whether such employee is hourly or
salaried, whether such employee is exempt or non-exempt, the number of such
employee's vacation days for 1996, whether such employee is absent from active
employment and, if so, the date such employee became inactive, the reason for
such inactive status and, if applicable, the anticipated date of return to
active employment (the "Employee List"). Seller shall provide Purchaser with an
-------------
updated Employee List immediately prior to Closing. Except as listed on the
Employees Schedule attached hereto, to the knowledge of Seller, no key employee
- ------------------
of the Business has given oral or written notice of resignation to Seller or
refusal to accept employment with Purchaser.
(b) Except as set forth on the Employees Schedule, no employees
------------------
related to the Business are represented by, and Seller is not party to, any
collective bargaining agreement or relationship with any labor organization.
The Collective Bargaining Agreements Schedule describes in detail each
-----------------------------------------
agreement, side agreement, side letter, memoranda of agreement or binding
employment practice or policy which the Collective Bargaining Agreements consist
of and each item on the Collective Bargaining Agreements Schedule has been
-----------------------------------------
provided to Purchaser prior to the Closing Date.
(c) Except as set forth on the Employees Schedule, to the Seller's
------------------
knowledge with respect to Employees of the Business: (i) no labor organization
or group of employees has filed any representation petition or made any written
or oral demand for recognition; (ii) no union organizing campaigns are underway
and no other question concerning representation exists; (iii) no labor strike,
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work stoppage or slowdown, or other material labor dispute is underway or
threatened; (iv) there is no employment-related charge, complaint,
investigation, inquiry pending or threatened in any forum, relating to an
alleged violation by Seller of any employment Law or contract; and (v) Seller
has not committed or been involved in the commission of any act or omission
giving rise to material liability for any employment-related violation of Law or
Collective Bargaining Agreement during the past 12 months. Any notice to
employees of the Business required under any law or collective bargaining
agreement to be given within the past 12 months has been given, and all
bargaining obligations with any employee representative have been satisfied.
Within the last 12 months Seller has not implemented any plant closing or mass
layoff of employees of the Business as those terms are defined in the WARN Act,
or any similar state or local law or regulation, and no layoffs that could
implicate such laws or regulations will be implemented before Closing without
the advance consent of Purchaser.
10.2 Representation With Respect to ERISA. As an inducement to
------------------------------------
Purchaser to enter into this Agreement, each of Seller and Ball hereby
represents and warrants to Purchaser that except as set forth on the Employee
--------
Benefits Schedule attached hereto:
- -----------------
(a) Multiemployer Plans. Neither Seller nor any member of its
-------------------
Controlled Group has any obligation to contribute to (or any other liability,
including current or potential Withdrawal Liability, with respect to) any
Multiemployer Plan for the benefit of any current or former employee of the
Business.
(b) Retiree Welfare Plans. Neither Seller nor any member of its
---------------------
Controlled Group maintains and has any obligation to contribute to (or any other
liability with respect to) any plan or arrangement whether or not terminated,
which provides medical, health, life insurance or other welfare-type benefits
for current or future retired or terminated employees of the Business, their
spouses or dependents (except for continued medical benefit coverage required to
be provided under Section 4980B of the IRC or as required under applicable state
laws).
(c) Defined Benefit Plans. Neither Seller nor any member of its
---------------------
Controlled Group maintains, contributes to or has any liability under (or with
respect to) any employee plan which is a "defined benefit plan" (as defined in
Section 3(35) of ERISA), whether or not terminated, for the benefit of current
or former employees of the Business.
(d) Defined Contribution Plans. Neither Seller nor any member of its
--------------------------
Controlled Group maintains, contributes to or has any liability under (or with
respect to) any employee plan which is a "defined contribution plan" (as defined
in Section 3(34) of ERISA), whether or not terminated, for the benefit of
current or former employees of the Business.
(e) Other Plans. Neither Seller nor any member of its Controlled Group
-----------
maintains, contributes to or has any liability under (or with respect to) any
Plan providing benefits to current or former employees of the Business,
including, without limitation, any bonus plan, plan for deferred compensation,
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severance, employee health or other welfare benefit plan or other arrangement,
whether or not terminated and whether or not subject to ERISA.
(f) Unfunded Liability. No Pension Plan for the benefit of current or
------------------
former employees of the Business maintained by Seller or any member of its
Controlled Group or to which Seller or any member of its Controlled Group has an
obligation to contribute, or with respect to which Seller or any member of its
Controlled Group has any other liability, other than the Ball Pension Plan, has
any material unfunded liability.
(g) Plan Qualification and Compliance. Each Qualified Plan for the
---------------------------------
benefit of current or former employees of the Business has received a favorable
determination letter from the Internal Revenue Service as to the qualification
of such plan and, to the best knowledge of Seller after due inquiry, nothing has
occurred since the date of such determination letter that could reasonably be
expected to adversely affect the qualification of such plan. Each Plan for the
benefit of current or former employees of the Business set forth on the attached
Employee Benefits Schedule and all related trusts, insurance contracts and funds
- --------------------------
have been maintained, funded and administered in compliance in all material
respects with their respective terms and with all applicable Laws.
10.3 Pension Plans.
-------------
(a) Effective on or before the Closing, Seller shall amend the Ball
Corporation Consolidated Hourly Pension Plan (the "Ball Pension Plan") to grant
-----------------
vesting and benefit accrual service for Employees of Seller who are employed as
of the Closing Date at the Owned Real Estate plant location, who are eligible to
participate in the Ball Pension Plan, and who are represented by (i) Local 4372,
United Steelworkers of America ("USWA Employees"), (ii) Local 729, International
--------------
Union of Electrical, Radio & Machine Workers, AFL-CIO ("IUE Employees") and
-------------
(iii) Local Lodge 162, District 34, International Association of Machinists and
Aerospace Workers, AFL-CIO ("IAM Employees"), as if such USWA Employees, IUE
-------------
Employees and IAM Employees were continuously employed by Seller through
December 31, 1998, September 30, 1997, and September 30, 1998, respectively
(each, respectively, an "Advance Funding Period"), to fulfill the obligation to
----------------------
provide pension benefits required under the Collective Bargaining Agreements
with respect to employment service until the end of the applicable Advance
Funding Period (the "Pension Benefit Liabilities"), but not including any
---------------------------
additional pension benefit liabilities resulting from any action by the
Purchaser in the form of (x) any amendment, modification, novation,
renegotiation or applicable plan or agreement termination occurring on or after
the Closing that increases any liability of Seller relating to any Employee for
any period prior to, on or after the Closing, (y) any benefit or rate increases
or adjustments that are adopted by the Purchaser after the Closing and that were
not, as of the date hereof, a part of any Plan (including any supplement
thereto), or collective bargaining agreement and (z) increases in benefits under
the Ball Pension Plan resulting from disability retirement after the Closing
Date with respect to Employees other than the Long-Term Disabled Employees and
Sick Pay Employees who do not return to active employment with the Purchaser
after the Closing Date. The liabilities described in the foregoing clauses (x),
(y) and (z) above are collectively referred to hereinafter as the "Additional
----------
Pension Liabilities" and such pension benefit attributable to the
- -------------------
-51-
<PAGE>
employment service during the Advance Funding Period, not including any
Additional Pension Liabilities, is referred to hereinafter as the "Pre-Funded
----------
Pension Benefits." On the Closing Date, Purchaser will pay to Seller, as an
- ----------------
adjustment to the Purchase Price (which adjustment shall be mutually agreed upon
by Purchaser and Seller prior to Closing), the estimated cost of the Pre-Funded
Pension Benefits (the "Pension Funding Amount") by wire transfer of immediately
----------------------
available funds to an account designated by Seller prior to the Closing Date.
After the Closing Date, Seller shall be solely liable for Pension Benefit
Liabilities, including providing the Pre-Funded Pension Benefits, but not
including Additional Pension Liabilities, upon the retirement of such Employees
who are eligible for such benefits. However, Purchaser shall be solely liable
for providing any pension benefits required under the Collective Bargaining
Agreements (or any successor agreements) with respect to service provided to
Purchaser by any Employee after the termination of the applicable Advance
Funding Period and for any Additional Pension Liabilities. For purposes of this
Agreement, Additional Pension Liabilities shall be deemed "Assumed Liabilities".
(b) On and after the Closing Date, Seller shall continue to operate
and administer the Ball Pension Plan for all participants in such plan,
including the Transferred Employees. Purchaser shall pay the Additional Pension
Liabilities which arise but shall not pay any additional administrative or other
similar costs with respect to the Pre-Funded Pension Benefits.
10.4 Assumption of Collective Bargaining Agreement. On and after
---------------------------------------------
the Closing Date, Purchaser shall assume all liabilities and obligations under
the Collective Bargaining Agreements, including but not limited to, any service
credits or benefit accruals under such agreements (which shall be Assumed
Liabilities for the purposes of the Agreement), except that Seller shall retain,
and Purchaser shall not assume or in any way become liable for (all of which
shall be Retained Liabilities for all purposes of this Agreement):
(a) any liability or obligation for any breach, grievance, or unfair
labor practice thereunder existing prior to the Closing (or any status, fact,
circumstance or condition existing on the Closing Date that, but for the giving
of notice or passage of time, would constitute a breach, grievance, or unfair
labor practice thereunder);
(b) any liability or obligation other than the Additional Pension
Liabilities (i) for the funding of, and the payment under, the Ball Pension Plan
of the Pre-Funded Pension Benefits; and (ii) for the payment of benefits accrued
as of the Closing Date under the Ball Pension Plan to Employees participating
thereunder on or prior to the Closing Date, pursuant to the terms of the Ball
Pension Plan in effect as of the Closing Date;
(c) any liability or obligation to pay disability benefit subsidies
under the Ball Pension Plan pursuant to the terms of such plan in effect as of
the Closing Date, to Sick Pay Employees who do not commence, or return to,
active employment with Purchaser on or after the Closing Date;
-52-
<PAGE>
(d) any liability or obligation to continue to pay post-retirement
medical and life insurance benefits (the "Post-Retirement Benefits") to
Employees who both (i) have commenced receiving Post-Retirement Benefits from
Seller prior to the Closing Date and (ii) do not commence employment with
Purchaser before the expiration of the Advance Funding Period; provided,
--------
however, that this Section 10.4(d) shall not include any liability or obligation
- -------
(the "Additional Post-Retirement Liabilities") that relate to increases or
----------------------------------------
adjustments to post-retirement medical and life insurance benefits with respect
to any Employees to the extent such increase or adjustment is the result of
conditions or events which occur after the Closing Date; and
(e) any liability or obligation to pay the cost of medical
continuation coverage with respect to the Laid-Off Employees to the extent
required pursuant to the terms of the Collective Bargaining Agreements as of the
Closing Date.
For purposes of this Agreement, "Additional Post-Retirement Benefits"
shall be "Assumed Liabilities".
10.5 Salaried Employees. Purchaser shall recognize the service
------------------
with Seller (or any predecessor thereto) of salaried Transferred Employees for
eligibility and vesting purposes under Purchaser's plans and with respect to
Purchaser's vacation and sick pay policies. Purchaser shall waive eligibility
restrictions under its plans, including any waiting periods or pre-existing
medical conditions, for each salaried Transferred Employee, who immediately
preceding the Closing participated in Seller's plans which provided similar
benefits.
10.6 Laid-Off Employees. Purchaser shall assume all obligations
------------------
under the Collective Bargaining Agreement with respect to Laid-Off Employees
other than the Seller's obligation to provide the continued medical coverage
described in the succeeding sentence. Seller shall continue medical coverage
with respect to each Laid-Off Employee to the extent required by the applicable
Collective Bargaining Agreement or, if earlier, until the date such Employee
commences active employment with the Purchaser on or after the Closing Date.
10.7 Employment-Related Pro Ration. The expenses and obligations
-----------------------------
set forth below shall be pro rated as of the Closing Date, with Seller being
responsible for that portion arising prior thereto and Purchaser being
responsible for that portion arising on the Closing Date or subsequent thereto.
The following expenses and obligations shall be prorated, provided that in no
event will the computation of any proration include any item included in the
Retained Liabilities:
(a) all wages, salaries, payroll taxes, sick pay and fringe benefits
of employees of Seller who continue in the employ of Purchaser after the Closing
Date shall be prorated on the basis of the number of working days (including
paid holidays) during the relevant payroll period which have elapsed prior to
the Closing Date; provided that any such wages, salaries, sick pay, or other
benefits payable to or for any such employee who continues in the employ of
Purchaser after the Closing Date but who requests such accrued benefits to be
-53-
<PAGE>
paid in cash by Seller as of the Closing Date, and who receives such payment in
cash, shall not be prorated but shall be paid by Seller; and
(b) all vacation pay with respect to employees of Seller who continue
in the employ of Purchaser after the Closing Date shall be prorated separately
on the basis of the ratio of the number of completed days that have elapsed
during such calendar year in which the Closing Date occurs divided by 365 days,
multiplied by the number of vacation days to which such employees are entitled
for such calendar year; provided that any such vacation pay payable to any such
employee who continues in the employ of Purchaser after the Closing Date but who
requests such vacation pay to be paid in cash by Seller as of or on the Closing
Date, and who has, by applicable law and the terms of the applicable plan, the
right to receive such payment in cash, shall not be prorated but shall be paid
by Seller.
10.8 Additional Covenants.
--------------------
(a) Seller shall not enter into, amend or modify any employment or
severance agreement or other agreement or arrangement with any Transferred
Employees, or grant any increase in salary or bonus or otherwise increase the
compensation payable to any Transferred Employee, consultant, advisor or agent
employed in connection with or rendering services to the Business, except wage
or salary increase as required by pre-existing contracts or compensation
policies which are consistent with past practices.
(b) As of the Closing, Purchaser shall (i) assume the obligation and
liability under the Collective Bargaining Agreements to offer employment
effective as of the Closing to all Employees covered by such agreements who are
listed on the Employees Schedule other than Laid-Off Employees; and (ii) offer
------------------
employment effective as of the Closing to each Salaried Employee where the terms
and conditions of employment with respect to such offer shall be at will and
shall include (1) immediate eligibility for participation in a 401(k) plan with
an employer matching contribution equal to 50% of the first 3% of such
Employee's compensation which is deferred under such 401(k) plan, (2) the same
base salary as such Employee received immediately prior to the Closing Date, (3)
vacation to which such Employee is entitled (or could become entitled to)
immediately prior to the Closing Date; (4) for the period from the Closing Date
until December 31, 1996, continuation of medical, dental, group life and
accidental death and dismemberment benefits in accordance with the Transition
Services Agreement as each such Employee received immediately prior to the
Closing Date, and (5) for the period on and after January 1, 1997, the Purchaser
shall offer 401(k), medical and welfare benefits to Salaried Employees who
remain in the employ of the Purchaser on or after January 1, 1997 that are
offered to other similarly situated employees of Milton Can Company, Inc.,
provided that Purchaser shall have no obligation to continue to offer any
specified benefits or level of benefits for any period thereafter.
(c) From the Closing Date to December 31, 1996, Seller shall continue
to provide Salaried Employees who become Transferred Employees on or after the
Closing and their covered dependents medical, dental, group life, and accidental
death and dismemberment benefits which were provided to such Employees
-54-
<PAGE>
immediately prior to Closing and Purchaser shall reimburse Seller for the
Reimbursable Cost of such benefits under Seller's plans with respect to
Transferred Employees or their covered dependents pursuant to the Transition
Services Agreement. Effective on or prior to the Closing Date, Purchaser shall
adopt a cafeteria plan for the benefit of the salaried Transferred Employees
which is substantially similar to the cafeteria plan such salaried Transferred
Employees participated in immediately prior to the Closing Date, under which
salaried Transferred Employees may defer the premium cost of medical, dental,
group life and accidental death and dismemberment insurance coverage and
continue deferrals into any existing health care reimbursement accounts and
dependent care reimbursement accounts under the Seller's plans with respect to
such salaried Transferred Employees and their covered dependents.
(d) On and after the Closing Date, Seller shall retain all
obligation, duty or liability relating to any claims by Employees (other than
Transferred Employees) and their covered dependents for: (i) medical costs and
expenses for claims incurred prior to the Closing Date; and (ii) costs, expenses
and other liabilities under any workers' compensation laws, regulations,
requirements or programs to the extent relating to any claim whenever arising
for any injury incurred prior to the Closing Date. On and after the Closing
Date, Purchaser shall assume all obligation, duty or liability relating to any
claims by Transferred Employees and their covered dependents for: (A) medical
costs and expenses for claims incurred on or after the Closing Date; and (B)
costs, expenses and other liabilities under any workers' compensation laws,
regulations, requirements or programs to the extent relating to any claim
whenever arising for any injury incurred on or after the Closing Date.
10.9 No Third Party Beneficiary Rights. No current or former
---------------------------------
employee of Purchaser, Seller or Ball (or their respective predecessors),
including without limitation any Employee or Transferred Employee or any
beneficiary of such employee under any plan is intended to nor shall be
construed to be a third party beneficiary of any representation, covenant,
warranty, recital or other statement contained in the Agreement.
ARTICLE XI
MISCELLANEOUS
11.1 Termination.
-----------
(a) This Agreement may be terminated and the transactions contemplated
hereby may be abandoned at any time, but not later than the Closing Date:
(i) by mutual consent of Seller and Purchaser;
(ii) by Seller, if through no material fault of Seller, the
Closing shall not have occurred on or prior to December 31, 1996;
-55-
<PAGE>
(iii) by Purchaser, if through no material fault of Purchaser,
the Closing shall not have occurred on or prior to December 31, 1996; or
(iv) by either party if any court of competent jurisdiction in the
United States or other United States governmental body shall have issued an
order, decree or ruling or taken any other action binding on the parties
restraining, enjoining or otherwise prohibiting the transactions contemplated
hereby and such order, decree, ruling or other action shall have become final
and nonappealable.
(b) In the event of the termination of this Agreement by any party as
above provided, this Agreement shall forthwith become void and no party shall
have any liability hereunder, including any liability for damages, except
pursuant to Sections 8.4 (with respect to confidentiality), 11.1(c) (with
respect to expense reimbursement), 11.7 (with respect to each party bearing its
own expenses), and 11.8 (with respect to public announcements), the provisions
of which shall survive any termination of this Agreement, and except for any
willful breach by any party hereto of such party's representations, warranties
or covenants which shall also survive the termination of this Agreement. In the
event that a condition precedent to its obligation is not met, nothing contained
herein shall be deemed to require any party to terminate this Agreement, rather
than to waive such condition precedent and proceed with the Closing.
(c) If Seller fails to comply with the requirements of Section 8.5 and
this Agreement is terminated by Purchaser pursuant to Section 11.1(a)(iii)
hereof, Seller will promptly (upon receipt of a written detailed statement from
Purchaser) deliver to Purchaser immediately available funds in an amount equal
to Purchaser's out-of-pocket costs and expenses incurred in connection with
pursuing the transactions contemplated hereby. Such expense reimbursement shall
be in addition to, and not a limitation on, any other remedy with respect to
this Agreement.
(d) If Purchaser fails to comply with the requirements of Section 8.5
and this Agreement is terminated by Seller pursuant to Section 11.1(a)(ii)
hereof, Purchaser will promptly (upon receipt of a written detailed statement
from Seller) deliver to Seller immediately available funds in an amount equal to
Seller's out-of-pocket costs and expenses incurred in connection with pursuing
the transactions contemplated hereby. Such expense reimbursement shall be in
addition to, and not a limitation on, any other remedy with respect to this
Agreement.
11.2 Condition of Assets. EXCEPT FOR THE REPRESENTATIONS AND
-------------------
WARRANTIES SPECIFICALLY PROVIDED FOR IN THIS AGREEMENT AND SUBJECT TO THE
INDEMNIFICATION PROVISIONS OF THIS AGREEMENT, ALL OF TANGIBLE ASSETS INCLUDED IN
THE PURCHASED ASSETS ARE SOLD TO PURCHASER "WHERE IS" AND "AS IS" WITHOUT
IMPLIED WARRANTY OF MERCHANTABILITY, FITNESS FOR INTENDED USE OR OTHERWISE.
11.3 Survival of Covenants and Agreements. Each and every
------------------------------------
covenant and agreement contained in this Agreement or any schedule hereto, or
-56-
<PAGE>
any certificate, document or other instrument delivered by the parties in
connection herewith, shall, subject to the limitations with respect to
representations and warranties set forth in Section 9.1 hereof and except as
otherwise provided herein, survive the Closing Date and the consummation of the
transactions contemplated hereby notwithstanding any investigation or inquiries
made by or conducted on behalf of any party hereto.
11.4 Equitable Remedies. The parties hereto acknowledge that
------------------
the Business and the Purchased Assets are unique and that irreparable damage
would result if this Agreement is not specifically enforced and that, therefore,
the rights and obligations of the parties under this Agreement may be enforced
by a decree of specific performance issued by a court of competent jurisdiction
and appropriate equitable relief may be applied for and granted in connection
therewith. Such remedies shall, however, not be exclusive and shall be in
addition to any other remedies which any party may have under this Agreement or
otherwise.
11.5 Assignment. (a) This Agreement will inure to the benefit
----------
of and be binding upon the successors and assigns of each of the parties hereto
and their respective successors and assigns, except as provided in subsections
(b) and (c) below.
(b) Neither Seller nor Ball may assign any of their respective duties
or obligations hereunder without the prior written consent of Purchaser, which
consent shall not be unreasonably withheld.
(c) Purchaser shall be entitled to assign (without Seller's consent)
its rights and/or obligations hereunder in whole or in part, to any of its
wholly-owned subsidiaries, and Seller shall be obligated to convey the Purchased
Assets to such assignee; provided, any such assignment shall not relieve
Purchaser of any of its obligations hereunder.
11.6 Notices. All notices and other communications hereunder
-------
shall be in writing and shall be deemed to have been duly given if delivered
personally, or mailed, by certified or registered mail, return receipt
requested, first class postage prepaid, or if sent by Federal Express or some
other reputable overnight carrier, or if sent by telecopy (provided that a
confirming copy is promptly sent or delivered by one of the other approved
means) to the parties at the following addresses:
If to Seller, addressed to:
Ball Corporation
345 South High Street
Muncie, IN 47305
Attention: Vice President, Planning
Telephone: 317/747-6100
Fax: 317/747-6826
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<PAGE>
With copies to (which shall not constitute notice hereunder):
Ball Corporation
Colorado Engineering Center
10 Longs Peak Drive
Broomfield, Colorado 80021-2510
Attention: General Counsel
Telephone: 303/460-2236
Fax: 303/460-2691
Skadden, Arps, Slate, Meagher & Flom
333 West Wacker Drive
Chicago, Illinois 60606
Attention: Brian W. Duwe
Telephone: 312/407-0700
Fax: 312/407-0411
If to Purchaser, addressed to:
Milton Can Company, Inc.
580 Division Street
Elizabeth, New Jersey 07201
Attention: James W. Milton
Telephone: 908/289-8100
Fax: 908/355-2397
With copies (which shall not constitute notice hereunder) to:
BWAY Corporation
8607 Roberts Drive
Atlanta, Georgia 30350
Attention: David P. Hayford
Telephone: 770/645-4843
Fax: 770/587-0186
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attention: William S. Kirsch, P.C.
Telephone: 312/861-2000
Fax: 312/861-2200
-58-
<PAGE>
or to such other place and with such other copies as any party may designate by
written notice to the other party.
11.7 Expenses. Except as otherwise provided in this Agreement, each
--------
party hereto shall pay its own expenses, including attorneys', accountants' and
brokerage fees, in connection with this Agreement, the performance of its
obligations hereunder and the consummation of the transactions contemplated
hereby.
11.8 Public Announcements. Except as required by law or the
--------------------
applicable requirements of any securities exchange, no press release or other
public statement with respect to this Agreement or the transactions contemplated
hereby shall be issued by either party without that party having consulted with
and obtained the consent of the other party, which shall not be unreasonably
withheld.
11.9 Entire Agreement. This Agreement supersedes all prior
----------------
discussions and agreements between the parties with respect to the subject
matter hereof (including, without limitation, the Letter of Intent dated August
29, 1996), and this Agreement, including the schedules and exhibits hereto and
other documents and agreements delivered in connection herewith, contains the
sole and entire agreement between the parties hereto with respect to the subject
matter hereof.
11.10 Waiver. Any term or condition of this Agreement may be
------
waived at any time by the party which is entitled to the benefit thereof. To be
effective, each such waiver shall be in writing, shall specifically refer to
this Agreement and the term or condition being waived, and shall be executed by
the President or any Vice President of such party. A waiver on one occasion
shall not be deemed to be a waiver of the same or any other breach on a future
occasion.
11.11 Amendment. This Agreement may be modified or amended
---------
only in a writing that specifically refers to this Agreement and the term or
condition being amended, and shall be executed by the President or any Vice
President of such party.
11.12 Counterparts. This Agreement may be executed in one or
------------
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
11.13 Invalid Provisions. If any provision of this Agreement
------------------
is held to be illegal, invalid, or unenforceable under any present or future
law, rule, or regulation, such provision shall be fully severable and this
Agreement shall be construed and enforced as if such illegal, invalid, or
unenforceable provision had never comprised a part hereof. The remaining
provisions of this Agreement shall remain in full force and effect and shall not
be affected by the illegal, invalid, or unenforceable provision or by its
severance herefrom.
11.14 Headings, Gender, Etc. The headings used in this
---------------------
Agreement have been inserted for convenience and do not constitute matter to be
construed or interpreted in connection with this Agreement. Unless the context
-59-
<PAGE>
of this Agreement otherwise requires, (a) words of any gender shall be deemed to
include each other gender, (b) words using the singular or plural number shall
also include the plural or singular number, respectively and (c) references to
"hereof," "herein," "hereby" and similar terms shall refer to this entire
Agreement.
11.15 CHOICE OF LAW. THIS AGREEMENT SHALL BE GOVERNED BY, PERFORMED,
-------------
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS,
WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW RULES OR
PROVISIONS (WHETHER OF THE STATE OF ILLINOIS OR ANY OTHER JURISDICTION) THAT
WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE
OF ILLINOIS.
11.16 No Third-Party Beneficiaries. This Agreement is for the
----------------------------
sole benefit of the parties hereto and their permitted assigns and nothing
herein expressed or implied shall give or be construed to give any person or
entity, other than the parties hereto and such permitted assigns, any legal or
equitable rights hereunder.
11.17 BWAY Obligations. BWAY shall be liable, jointly and
----------------
severally with Purchaser, for all payment obligations of Purchaser hereunder
(including any indemnification obligations hereunder).
* * * * *
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<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be duly executed as of the day and year first above written.
BWAY CORPORATION
With respect to Payment Obligations Hereunder
Only
---------------------------------------------
By: David P. Hayford
Title: Senior Vice President and
Chief Financial Officer
MILTON CAN COMPANY, INC.
---------------------------------------------
By: David P. Hayford
Title: Vice President
BALL CORPORATION
---------------------------------------------
By:
Title:
BALL METAL FOOD CONTAINER CORP.
---------------------------------------------
By:
Title:
-61-
<PAGE>
List of Exhibits
----------------
Exhibit A - Materials Supply/Tolling Agreement
-62-
<PAGE>
List of Schedules
-----------------
Books and Records Schedule
Excluded Assets Schedule
Other Assets Schedule
Permits Schedule
Personal Property Schedule
Contracts Schedule
Vehicle Schedule
Lien Schedule
Subsidiaries Schedule
Conflicts Schedule
Consents Schedule
Financial Statements Schedule
Liabilities Schedule
Developments Schedule
Customers Schedule
Insurance Schedule
Contracts Schedule
Assets Schedule
Owned Properties Schedule
Permitted Encumbrances Schedule
Proprietary Rights Schedule
Litigation Schedule
Warranty Schedule
Employees Schedule
Employee Benefits Schedule
Environmental Schedule
Taxes Schedule
Intercompany Services Schedule
Excluded Employees Schedule
-63-
<PAGE>
ANNEX A
Allocation of Purchase Price
----------------------------
Owned Real Property $ 6,140,000 ($1,740,000 of which shall
be allocated for the land)
Purchased Assets other than Owned $33,860,000 +/- the Purchase Price
Real Property Adjustment + the Pension
Funding Amount
Total $40,000,000 +/- the Purchase Price
Adjustment + the Pension
Funding Amount
-64-
<PAGE>
AMENDMENT NO. 1
TO ASSET PURCHASE AGREEMENT
---------------------------
THIS AMENDMENT NO. 1 TO ASSET PURCHASE AGREEMENT (this "Amendment"), dated
---------
as of October 28, 1996, amends that certain Asset Purchase Agreement dated as of
October 6, 1996 (the "Agreement"), by and between Ball Metal Food Container
---------
Corp., a Delaware corporation ("Seller"), Ball Corporation, an Indiana
------
corporation ("Ball"), Brockway Standard (New Jersey), Inc., a Delaware
----
corporation ("BSNJ") formerly known as Milton Can Company, Inc. and, with
----
respect to payment obligations thereunder only, BWAY Corporation, a Delaware
corporation ("BWAY"). Capitalized terms not otherwise defined herein have the
----
meanings given such terms in the Agreement.
Following execution of the Agreement, BSNJ assigned its rights and
obligations under the Agreement to its newly-formed wholly-owned subsidiary,
Milton Can Company, Inc. and designated Milton Can Company, Inc. as the
"Purchaser" under the Agreement in accordance with the terms of the Agreement.
The parties to the Agreement wish to amend the Agreement to (i) update the
schedules to be attached thereto and (ii) resolve certain ambiguities in the
language of the Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein the parties hereto covenant and agree as follows:
1. Definition of Remediation Requirements. The sixth sentence of Section
--------------------------------------
9.3(c) of the Agreement is hereby deleted and replaced in its entirety with:
"For purposes of this Section, "Remediation Requirements" shall mean
------------------------
Environmental and Safety Laws in effect on the earlier of (i) the date
of the remediation or (ii) the date the most stringent Environmental
and Safety Laws are in effect on or before the sixth anniversary of
the Closing Date."
2. Revised Schedules. The (i) Litigation Schedule, (ii)
-----------------
Environmental Schedule, (iii) Environmental Indemnification Schedule,
(iv)Employee Schedule, (v) Employee Benefit Schedule, (vi) Laid-Off Employees
Schedule, (vii) Salaried Employee Schedule and (viii) Sick Pay Employees
Schedule appearing in the Agreement are hereby deleted in their entirety and
replaced with the Schedules on Exhibit A attached hereto and made a part hereof
---------
by this reference.
3. Miscellaneous. The provision of Article XI of the Agreement
-------------
shall govern this Amendment.
<PAGE>
4. Effect of this Amendment. The Agreement, as amended pursuant to
------------------------
the terms of this Amendment, shall continue in full force and effect after the
time of this Amendment.
* * * * *
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment to be duly executed as of the day and year first above written.
BWAY CORPORATION
With Respect To Payment Obligations Under The
Agreement Only
/s/ David P. Hayford
-------------------------------------------------
By: David P. Hayford
Title: Senior Vice President and
Chief Financial Officer
MILTON CAN COMPANY, INC.
/s/ David P. Hayford
-------------------------------------------------
By: David P. Hayford
Title: Vice President
BALL CORPORATION
-------------------------------------------------
By:
Title:
BALL METAL FOOD CONTAINER CORP.
-------------------------------------------------
By:
Title:
