ESCROW AGREEMENT
THIS ESCROW AGREEMENT ("Agreement"), is made as of July 30, 2004 by and
among AALBERTS INDUSTRIES U.S. HOLDING CORP., a Delaware corporation ("Parent"),
ELKHART PRODUCTS CORPORATION, a Delaware corporation ("U.S. Purchaser"), ELKHART
PRODUCTS LTD., a Canada corporation ("Canadian Purchaser" and collectively with
Parent and U.S. Purchaser, "Purchasers"), AMCAST INDUSTRIAL CORPORATION, an Ohio
corporation ("Amcast"), ELKHART PRODUCTS CORPORATION, an Indiana corporation
("Elkhart"), and AMCAST INDUSTRIAL LIMITED, a Canada corporation (collectively
with Amcast and Elkhart, "Sellers"), and Wells Fargo Bank, N.A., a financial
institution located in Fort Wayne, Indiana, as escrow agent ("Escrow Agent").
RECITALS
A. WHEREAS, Sellers and Purchasers have entered into an Asset Purchase
Agreement dated as of July 8, 2004 (the "Purchase Agreement").
B. WHEREAS, the execution of this Agreement is a condition to the
consummation of the transactions contemplated by the Purchase Agreement.
C. WHEREAS, capitalized terms used in this Agreement and not otherwise
defined shall have the respective meanings given to them in the Purchase
Agreement.
NOW, THEREFORE, for and in consideration of the mutual promises and
covenants herein contained and for other good and valuable consideration, the
receipt and adequacy of which hereby are acknowledged, the parties hereto agree
as follows:
1. Establishment of Escrow Fund. Simultaneously with the execution of this
Agreement, Purchasers shall deliver Seven Hundred Thousand Dollars (US $700,000)
(the "Escrow Payment") by wire transfer to the Escrow Agent, and the Escrow
Agent shall acknowledge receipt of such amount. The Escrow Agent agrees to hold
and disburse the Escrow Payment and any interest, dividends, distributions or
other income or capital appreciation received on or from the Escrow Payment
("Interest" and, together with the Escrow Payment, the "Escrow Fund") in
accordance with the terms and conditions of this Agreement.
2. Investment of Escrow Fund; Accounting.
(a) Investments. The Escrow Agent shall invest all of the Escrow Fund in
such investments as may be designated to the Escrow Agent by both a Purchaser
and a Seller in writing from time to time and, if no designation is provided by
both a Purchaser and a Seller, then in one or more money-market accounts.
(b) Monthly Accounting. Upon written request of both a Purchaser and a
Seller, the Escrow Agent shall deliver to each of the parties, a monthly
accounting in writing of the property constituting the Escrow Fund and all
distributions (including payments in respect of the Escrow Agent's fees and
expenses) from the Escrow Fund during such month.
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3. Disbursements.
(a) Disbursement Upon Joint Instructions. The Escrow Fund shall be used to
pay the premium for a representations and warranty policy to be obtained by
Purchasers on terms no less favorable to the insured parties than the terms
proposed by AIG in its indication of interest dated June 21, 2004 (the
"Indemnification Insurance"). If the Indemnification Insurance policy is issued
within six months after the Closing, the Escrow Fund shall be used to pay the
premium for the Indemnification Insurance. If the premium is less than the
Escrow Fund, then the balance of the Escrow Fund shall be promptly disbursed to
Sellers; if the premium is more than the Escrow Fund, then the excess shall be
paid by Purchasers. Purchasers and Sellers covenant and agree to give the Escrow
Agent joint instructions to disburse the Escrow Fund as set forth in this
Section promptly after Purchasers have provided Sellers with proof reasonably
acceptable to Sellers that Purchasers have purchased Indemnification Insurance
consistent with the requirements of this Section. Notwithstanding anything
herein to the contrary, upon receipt by the Escrow Agent of joint written
instructions signed by both a Purchaser and a Seller to disburse all or any
amount of the Escrow Fund, the Escrow Agent shall disburse the Escrow Fund as so
instructed; provided, however, that the Escrow Agent shall be entitled to retain
any fees and expenses payable to the Escrow Agent as provided for in Section
5(c).
(b) Termination of the Escrow Fund. On the first occur of (i) the
distribution of all of the Escrow Fund pursuant to Section 3(a) or (ii) the date
that is six months after the Closing (the "Termination Date"), the Escrow Agent
shall disburse to Amcast on behalf of all Sellers the balance of the Escrow Fund
after any distributions made pursuant to Section 3(a); provided, however, that
the Escrow Agent shall be entitled to retain any fees and expenses payable to
the Escrow Agent as provided for in Section 5(c); provided, further, however,
that if Purchasers have provided Sellers and the Escrow Agent with proof that
the Purchasers have purchased Indemnification Insurance consistent with the
requirements of Section 3(a) and Sellers have not given the Escrow Agent the
instructions to disburse the Escrow Fund in accordance with Section 3(a), or if
Sellers dispute any disbursement made by the Escrow Agent to pay a premium for
any insurance purporting to be consistent with Section 3(a), then the
Termination Date shall be extended until such time as the joint instructions
described in Section 3(a) have been given to the Escrow Agent or the dispute has
been resolved.
4. Resolution of Disputes.
(a) Disputes. Any dispute that may arise under this Agreement shall be
settled as promptly as practicable either by mutual agreement of Purchasers and
Sellers (evidenced by joint instructions to the Escrow Agent) or as provided in
Section 15.
(b) No Duty of Escrow Agent. The Escrow Agent shall be under no duty to
institute or defend any proceedings brought under this Agreement and none of the
costs and expenses of any such proceedings shall be borne by the Escrow Agent.
Prior to the settlement of any dispute as provided in this Agreement, the Escrow
Agent is authorized and directed to retain such portion of the Escrow Fund which
is the subject of or involved in the dispute.
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5. Rights and Duties of Escrow Agent.
(a) Limited Duties. Escrow Agent shall not be under any duty to give the
Escrow Fund held by it hereunder any greater degree of care than it gives its
own similar property and shall not be required to invest any funds held
hereunder except as directed in this Agreement. The Escrow Agent undertakes to
perform only such duties as are expressly set forth in this Agreement. The
Escrow Agent shall not be bound by any waiver, modification, amendment,
termination, cancellation or revision of this Agreement, unless any of the
foregoing is in writing and signed by the other parties to this Agreement, and,
if the Escrow Agent's duties are affected, unless the Escrow Agent shall have
given its prior written consent thereto. The Escrow Agent shall not be bound by
any assignment by Purchasers or Sellers of their rights under this Agreement
unless the Escrow Agent shall have received written notice thereof from the
assignor. The Escrow Agent shall perform any acts required under the resolution
procedures described in Section 15 or ordered by a court of competent
jurisdiction. This Agreement expressly sets forth all the duties of Escrow Agent
with respect to any and all matters pertinent hereto. No implied duties or
obligations shall be read into this Agreement against Escrow Agent. Escrow Agent
shall not be bound by the provisions of any agreement among the other parties
except this Agreement, and Escrow Agent is specifically not a party to or bound
by the Purchase Agreement.
(b) No Representation. The Escrow Agent makes no representation as to the
validity, value, genuineness or the collectability of any document or instrument
held by or delivered to the Escrow Agent.
(c) Fees. The Escrow Agent agrees to serve as Escrow Agent in accordance
with the fee schedule attached to this Agreement as Exhibit A. The Escrow Agent
shall also be entitled to reimbursement of its reasonable fees and other
expenses (including reasonable legal fees and expenses) incurred by the Escrow
Agent in connection with extraordinary services required hereunder (including
any interpleader action pursuant to Section 5(g)) or on account of disputes
among and between Purchasers and Sellers. All fees and expenses payable to the
Escrow Agent under this Section 5(c) shall be paid from the Escrow Fund, and if
the Escrow Fund is not sufficient to pay such fees and expenses, the fees and
expenses shall be paid one-half by Purchasers, on one hand, and one-half by
Sellers, on the other hand.
(d) Indemnification. Purchasers and Sellers agree to jointly and severally
indemnify the Escrow Agent for, and to hold it harmless against, any and all
claims, suits, actions, proceedings, investigations, judgments, deficiencies,
damages, settlements, liabilities and expenses (including reasonable legal fees
and expenses of attorneys chosen by the Escrow Agent) ("Losses") as and when
incurred, arising out of or based upon any act, omission, alleged act or alleged
omission by the Escrow Agent or any other cause, in any case in connection with
the acceptance of, or performance or non-performance by the Escrow Agent of any
of the Escrow Agent's duties under this Agreement, except as a result of the
Escrow Agent's willful misconduct or gross negligence. The Escrow Agent is
hereby granted a lien on the Escrow Fund to secure the foregoing indemnity.
Purchasers and Sellers agree that one-half of all Losses shall be paid by
Purchasers, on one hand, and one-half of any Losses shall be paid by Sellers, on
the other hand.
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(e) Investments. Purchasers and Sellers understand that investments in the
Escrow Fund are not necessarily insured by the United States government or any
agency or instrumentality thereof or of any state or municipality. The Escrow
Agent shall not be liable for any depreciation in the value of the Escrow Fund
invested in accordance with this Agreement.
(f) Limited Liability. The Escrow Agent acts hereunder as a depository
only, and except in cases of the Escrow Agent's willful misconduct or gross
negligence, the Escrow Agent shall be protected by acting in reliance upon any
certificate, statement, request, notice, advice, direction, or other agreement,
instrument or signature believed by the Escrow Agent to be genuine, by assuming
that any person or entity purporting to give the Escrow Agent any of the
foregoing in accordance with the provisions of this Agreement, or in connection
with either this Agreement or the Escrow Agent's duties hereunder, has been duly
authorized to do so, or by acting in good faith on the advice of counsel
retained by the Escrow Agent. The Escrow Agent shall not be liable for any
mistake of fact or law or any error of judgment, or for any act or omission,
except as a result of its willful misconduct or gross negligence. In the event
that the Escrow Agent shall be uncertain as to its duties or rights hereunder,
or shall receive any certificate, statement, request, notice, advice, direction
or other agreement or instrument from any other party with respect to the Escrow
Fund which, in the Escrow Agent's opinion is in conflict with any of the
provisions of this Agreement, or shall be advised that dispute has arisen with
respect to the payment, ownership or right of possession of the Escrow Fund or
any part thereof (or as to the delivery, non-delivery or content of any
certificate, statement, request, notice, advice, direction or other agreement or
instrument), the Escrow Agent shall be entitled, without liability to any person
or entity, to refrain from taking any action other than to use its best efforts
to keep safely the Escrow Fund until the Escrow Agent shall be directed
otherwise in accordance with this Agreement. The Escrow Agent shall be under no
duty to institute or defend any proceeding.
(g) Interpleader. Purchasers and Sellers authorize the Escrow Agent, if the
Escrow Agent is threatened with litigation or is sued, to interplead all
interested parties in any court of competent jurisdiction and to deposit the
Escrow Fund with the clerk of that court.
(h) Advice of Counsel. Escrow Agent may act pursuant to the advice or
opinion of counsel with respect to any matter relating to this Agreement and
shall not be liable for any action taken or omitted by it in good faith in
accordance with such advice or opinion.
(i) No Investment Advice. Escrow Agent shall not be called upon to advise
any party as to the wisdom in selling, retaining, taking or refraining from any
action with respect to any securities or other property deposited hereunder.
6. Resignation; Successor Escrow Agent.
(a) Resignation. The Escrow Agent may resign and be discharged from its
duties or obligations under this Agreement at any time by giving no less than
fifteen (15) business days notice of such resignation to Purchasers and Sellers
specifying the date when such resignation shall take effect. After such
resignation, the Escrow Agent shall have no further obligation under this
Agreement except to hold the Escrow Fund as depository, and the Escrow Agent
shall refrain from taking any action until it shall receive joint written
instructions from both a Purchaser and a Seller designating a banking
corporation, trust company, attorney or other person or entity as successor
Escrow Agent. Upon receipt of such joint instructions and the Acceptance, as
defined in Section 6(d), the Escrow Agent shall promptly deliver the Escrow Fund
to such successor Escrow Agent and render the accounting required by Section
6(c) and shall thereafter have no further obligations hereunder.
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(b) Termination. Purchasers and Sellers acting together shall have the
right to terminate the appointment of the Escrow Agent by giving joint
instructions of such termination to the Escrow Agent, specifying the date upon
which such termination shall take effect. After termination, the Escrow Agent
shall hold the Escrow Fund as a depository pending transfer to a successor. In
the event of such termination, Purchasers and Sellers agree that they will
jointly appoint a successor Escrow Agent within fifteen (15) business days of
giving such notice and the Escrow Agent agrees that it shall turn over and
deliver to such successor Escrow Agent all of the Escrow Fund and any other
amounts held by it pursuant to this Agreement and render the accounting required
by Section 6(c) and shall thereafter have no further obligations hereunder. Upon
receipt of the funds and other amounts and execution of the Acceptance, the
successor Escrow Agent shall thereupon be bound by all of the provisions of this
Agreement.
(c) Accounting. In the event of the resignation or removal of the Escrow
Agent or upon the termination of the appointment of the Escrow Agent pursuant to
Section 6(b), the Escrow Agent shall render to Purchasers and Sellers and to the
successor Escrow Agent, if any, an accounting in writing of the property
constituting the Escrow Fund and all distributions therefrom.
(d) Successor. If at any time the Escrow Agent shall give notice of its
resignation pursuant to Section 6(a), shall be removed pursuant to Section 6(b),
or shall be dissolved or otherwise become incapable of acting, or the position
of the Escrow Agent shall become vacant for any other reason, Purchasers and
Sellers shall promptly mutually appoint a successor Escrow Agent. Promptly after
such appointment, the predecessor Escrow Agent shall deliver the Escrow Fund to
such successor Escrow Agent and render the accounting required by Section 6(c)
and shall thereafter have no further obligations under this Agreement. If a
successor Escrow Agent has not been appointed within sixty (60) days of the date
of any such resignation, removal, dissolution, incapacity or vacancy, the Escrow
Agent may deposit the Escrow Fund with the clerk of a court of competent
jurisdiction and may interplead all of the parties or may petition such court to
appoint a successor Escrow Agent. Upon so depositing the Escrow Fund and filing
its pleading, this Agreement shall terminate as to the Escrow Agent.
7.Ownership for Tax Purposes. For purposes of this Agreement, the parties
agree to adopt for federal and state income tax purposes Proposed Regulation
1.468B-8 promulgated under the Internal Revenue Code. Pursuant to this
provision, all interest accruing on the Escrow Fund prior to the Termination
Date shall be allocated to Amcast. The Escrow Agent shall deliver Amcast a Form
1099 each year with respect to the interest. Amcast hereby certifies that its
correct federal taxpayer identification number is 31-0258080 and shall provide
such other certification as Escrow Agent may require.
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8. Entire Agreement. This Agreement supersedes any and all other
agreements, oral or written, among the parties hereto with respect to the
subject matter hereof, and contains the entire agreement among the parties with
respect to the transactions contemplated hereby.
9. Amendments; Waiver. This Agreement may be amended, modified, superseded
or canceled and any of its provisions may be waived only by a written instrument
executed by all of the parties or, in the case of a waiver, by or on behalf of
the party waiving compliance. The failure of any party at any time to require
performance of any provision of this Agreement shall in no manner affect the
right of that party at a later time to enforce the same or a different
provision. No waiver by any party of any condition or of any breach of any
provision of this Agreement, in any one or more instances, shall be deemed to be
or construed as a further or continuing waiver of any such condition or of any
breach of the same or a different provision.
10. Successors; Assignment. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
permitted transferees and assignees. Neither this Agreement nor any interest
herein may directly or indirectly be transferred or assigned by any party, in
whole or in part, without the written consent of the other parties, except that
Purchasers may effect any such assignment to any Affiliate, but any such
assignment shall not relieve Purchasers of their duties and obligations
contained in this Agreement.
11. Notices. Any notice, request, demand or other communication to be given
pursuant to the terms of this Agreement must be in writing and shall be deemed
to have been duly given on the day it is delivered by hand, on the day it is
sent by facsimile with confirmation of receipt by the transmitting facsimile
machine, on the next business day after it is sent by a nationally recognized
overnight mail service (delivery charge prepaid), or on the third business day
after it is mailed first class, postage prepaid, in each case to the following
addresses:
If to Sellers: Amcast Industrial Corporation
7887 Washington Village Drive
Dayton, Ohio 45499-3959
Attention: Joseph R. Grewe, President
and Chief Executive Officer
Facsimile: 937-291-7007
with copies to: Barnes & Thornburg LLP
601 Campau Square Plaza
99 Monroe Ave., NW
Grand Rapids, Michigan 49503
Attention: R. Paul Guerre, Esq.
Facsimile: 616-742-3999
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If to Purchasers: Aalberts Industries N.V.
Sandenburgerlaan 4
3947 CS Langbroek
Netherlands
Attention: Berend P. Bolkenstein
Facsimile: 011-31-343-565-081
with copies to: Fulbright & Jaworski L.L.P.
2200 Ross Avenue, Suite 2800
Dallas, Texas 75201
Attention: Harva R. Dockery, Esq.
Facsimile: 214-855-8200
If to Escrow Agent: Wells Fargo Bank, N.A.
116 E. Wayne St.
N 8622-033
Ft. Wayne, Indiana
46802 Attention:
Roberta A. Jensen
Facsimile: (260)
461-6480
or to such other address or to such other person as any party shall have last
designated by written notice provided to the other parties in the manner set
forth in this Section.
12. Severability. If any provision of this Agreement or any application
thereof shall be invalid or unenforceable, the remainder of this Agreement and
any other application of such provision shall not be affected thereby.
13. No Third Party Beneficiary. This Agreement is for the benefit of, and
may be enforced only by, the parties hereto and their respective successors and
permitted transferees and assignees, and is not for the benefit of, and may not
be enforced by, any third party.
14. Applicable Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of New York without regard to
conflict of law principles.
15. Arbitration.
(a) The parties agree that any and all disputes, claims or controversies
arising out of or relating to this Agreement or the breach, termination,
enforcement, interpretation or validity thereof, including the determination of
the scope or applicability of this agreement to mediate and arbitrate, shall be
mediated before a mediator agreeable to both parties or, if they cannot agree,
then before JAMS, or its successor. The mediation shall be conducted at a
mutually agreeable location or, if they cannot agree, then at the JAMS office in
Elkhart, Indiana. Any party may commence mediation by providing to the other
parties a written request for mediation, setting forth the subject of the
dispute and the relief requested. The parties shall cooperate with one another
in selecting a mediator and in scheduling the mediation proceedings. The parties
covenant that they shall participate in the mediation in good faith, and that
they shall share equally in its costs. All offers, promises, conduct and
statements, whether oral or written, made in the course of the mediation by any
of the parties or their Representatives, and by the mediator or any JAMS
employees, are confidential, privileged and inadmissible for any purpose,
including impeachment, in any arbitration or other Action involving the parties,
provided that evidence that is otherwise admissible or discoverable shall not be
rendered inadmissible or non-discoverable as a result of its use in the
mediation.
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(b) Any party may initiate arbitration with respect to the matters
submitted to mediation by filing a written demand for arbitration at any time
following the initial mediation session or 45 days after the date of filing the
written request for mediation, whichever occurs first. The mediation may
continue after the commencement of arbitration if the parties so desire. Unless
otherwise agreed by the parties, the mediator shall be disqualified from serving
as arbitrator in the case. Arbitration may be enforced by any court of competent
jurisdiction, and the party seeking enforcement shall be entitled to an award of
all costs, fees and expenses, including reasonable attorneys fees, to be paid by
the party or parties against whom enforcement is ordered.
(c) Any arbitration shall be conducted at a mutually agreeable location or,
if the parties cannot agree, in Elkhart, Indiana. The arbitration shall be
before a sole arbitrator mutually selected by the parties or, if they cannot
agree, then before a retired judge to be selected by JAMS pursuant to its
Comprehensive Arbitration Rules and Procedures, who shall thereafter administer
the arbitration, provided however that JAMS shall identify the preceding ten
(10) arbitrations conducted by each arbitrator candidate and the lawyers
involved in the arbitration. The arbitration shall be conducted pursuant to the
foregoing rules except as set forth herein. The parties to the dispute shall be
permitted to conduct pre-hearing discovery in the form of depositions and
document production requests subject to the control of the arbitrator. The award
of the arbitrator shall be a reasoned award specifying all essential findings of
fact and conclusions of law necessary to support the award. Judgment on the
award may be entered in any court having jurisdiction. In any proceeding to
confirm the award, the court also shall have jurisdiction to review the award
for errors of law.
(d) The cost of the arbitration shall initially be borne equally by the
parties. In the award the arbitrator shall allocate, consistent with the
indemnification provisions of this Agreement, all of the costs of the
arbitration (and the mediation, if applicable), including the fees of the
arbitrator and the reasonable attorneys' fees of the prevailing party, against
the party or parties who did not prevail.
16. Counterparts. This Agreement may be executed in two or more
counterparts and by the parties on separate counterparts, all of which shall be
considered one and the same instrument, and each of which shall be deemed an
original. Each of the parties hereto (i) has agreed to permit the use, from time
to time, of faxed or otherwise electronically transmitted signatures in order to
expedite the consummation of the transactions contemplated hereby, (ii) intends
to be bound by its respective faxed or otherwise electronically transmitted
signature, (iii) is aware that the other parties hereto shall rely on the faxed
or otherwise electronically transmitted signature, and (iv) acknowledges such
reliance and waives any defenses to the enforcement of the documents effecting
the transaction contemplated by this Agreement based on the fact that a
signature was sent by fax or otherwise electronically transmitted.
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17. Headings; Construction. The headings of the sections and paragraphs in
this Agreement have been inserted for convenience of reference only and shall
not restrict or otherwise modify any of the terms or provisions of this
Agreement. Unless otherwise expressly provided, the words "including" or
"includes" whenever used in this Agreement do not limit the preceding words or
terms. With regard to all dates and time periods set forth or referred to in
this Agreement, time is of the essence.
18. Consent to Service of Process and Jurisdiction. The parties agree that,
in the event it becomes necessary for any party to enforce any provision of this
Agreement or any arbitration award obtained pursuant to Section 15 of this
Agreement by legal action, the parties hereby consent that suit may be brought
hereunder in any court of appropriate jurisdiction in Elkhart County, Indiana,
U.S.A., or in the United States District Court for the Northern District of
Indiana, regardless of the state, county or country in which any party may
reside or have such parties domicile (corporate or individual) at the time of
any such action. The parties consent to service of process and other notices
given or required in any proceedings submitted to arbitration by either party
pursuant to the provisions of Section by personal delivery or by registered mail
addressed to such party at the addresses set out in Section 10. However, any
party may serve legal process in any other manner permitted by Law or the rules
of the American Arbitration Association.
[Signature Page immediately following]
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The parties hereto have caused this Escrow Agreement to be fully executed
as of the date first set forth above.
ELKHART PRODUCTS CORPORATION
(a Delaware corporation)
By: ____________________________
Its: _______________________
ELKHART PRODUCTS LTD.
(a Canada corporation)
By: ____________________________
Its: _______________________
AMCAST INDUSTRIAL CORPORATION
(an Ohio corporation)
By: ____________________________
Joseph R. Grewe, President
ELKHART PRODUCTS CORPORATION
(an Indiana corporation)
By: ____________________________
Joseph R. Grewe, President
AMCAST INDUSTRIAL LIMITED
(a Canada corporation)
By: ____________________________
Joseph R. Grewe, President
Wells Fargo Bank, N.A.
By: ____________________________
Its: _______________________
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Exhibit A
Escrow Agent Fees
Acceptance Fee: $500.00 per Escrow Agreement
Initial Fees as they relate to Wells Fargo Bank acting in the capacity of Escrow
Agent - includes creation and examination of the Escrow Agreement; acceptance of
the Escrow appointment; setting up of Escrow Account(s) and accounting records;
coordination of receipt of funds for deposit to the Escrow Account(s); and due
diligence performed on all parities to the agreement.
Acceptance Fee payable at time of Escrow Agreement execution.
Annual Administration Fee: $2,000.00 Per Escrow Agreement
- -------------------------
For ordinary administration services by Escrow Agent - includes daily routine
account management; investment transactions; cash transaction processing
(including wires and check processing); monitoring claim notices pursuant to the
agreement; disbursement of the funds in accordance with the agreement; and
mailing of trust account statements to all applicable parties. Tax reporting is
included for up to One (1) entity.
Payable in advance, with the first installment due at the time of Escrow
Agreement execution. Fee will not be prorated in case of early termination.
Wells Fargo's bid is based on the following assumptions:
o Deposit amount: Approximately $700,000
o Number of escrow funds/accounts to be established: One (1)
o Number of Deposits to Escrow Account: One (1)
o Number of Withdrawals from Escrow Fund: One (1)
o Term of Escrow: 6 months or less
o ALL FUNDS WILL BE RECEIVED FROM OR DISTRIBUTED TO A DOMESTIC ENTITY
o ESCROW APPOINTMENT SUBJECT TO WELLS FARGO DUE DILIGENCE
Out-of Pocket Expenses: At Cost
We only charge for out-of-pocket expenses in response to specific tasks assigned
by the client. Therefore, we cannot anticipate what specific out-of-pocket items
will be needed or what corresponding expenses will be incurred. Possible
expenses would be, but are not limited to, express mathomail and messenger
charges, travel expenses to attend closing or other meetings. There are no
charges for indirect out-of- pocket expenses.
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TRANSITION SERVICES AGREEMENT
THIS TRANSITION SERVICES AGREEMENT ("Agreement") is made as of July ___,
2004, between ELKHART PRODUCTS CORPORATION, a Delaware corporation
("Purchaser"), and LEE BRASS COMPANY, a Delaware corporation (the "Company").
RECITALS
A. WHEREAS, pursuant to an Asset Purchase Agreement (the "Purchase
Agreement"), dated as of July __, 2004, by and among Purchaser, certain
affiliates of Purchaser, and certain affiliates of the Company, Purchaser is
acquiring substantially all of the assets of certain affiliates of the Company.
B. WHEREAS, it is a condition to the closing of the transactions
contemplated by the Purchase Agreement that Purchaser and the Company
contemporaneously enter into this Agreement pursuant to which Purchaser shall
provide the Company with certain transitional services as described below.
C. WHEREAS, capitalized terms used in this Agreement without definition
shall have the respective meanings given to them in the Purchase Agreement.
NOW, THEREFORE, for and in consideration of the mutual promises and
covenants herein contained and for other good and valuable consideration, the
receipt and adequacy of which hereby are acknowledged, the parties hereto agree
as follows:
1. Services.
1.1 IT Services. Purchaser shall provide the Company with information
technology support and services, which shall include assisting the Company
in establishing its own server and telephone services and in transitioning
such services to the Company and shall include the use of the licenses and
services under the following contracts: (i) Microsoft Business Agreement
between Elkhart Products Corporation and MSLI, GP dated July 10, 2002; and
(ii) Microsoft Select Agreement between Elkhart Products Corporation and
MSLI, GP dated July 10, 2002 (the "IT Services"). The IT Services shall
also include the use and benefit of the AS/400 Servicer located in Elkhart,
Indiana.
1.2 Sales Services. Purchaser shall assist the Company in the training
of the Company's sales manager to be designated by the Company, which shall
including introducing the new sales manager to customers as requested by
the Company (the "Sales Services").
1.3 Purchasing Services. Purchaser shall provide the Company with
purchasing support and services and shall assist the Company in the
training of the Company's employee in charge of purchasing to be designated
by the Company and in transitioning such services to the Company (the
"Purchasing Services").
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1.4 HR Services. Purchaser shall provide the Company with the human
resources support and services and shall assist the Company in the training
of a new human resources employee to be designated by the Company and in
transitioning such services to the Company (the "HR Services").
1.5 Accounting Services. Purchaser shall perform payroll and
accounting services for the Company and shall assist the Company in
transitioning such services to the Company (the "Accounting Services").
1.6 Scope of Services. The IT Services, Sales Services, Purchasing
Services, HR Services and Accounting Services (collectively, the
"Services") shall be performed in a manner and scope consistent with the
way in which and the extent to which the Services were provided to the
Company by Elkhart Products Corporation (the Indiana corporation) prior to
the Closing.
2. Consideration. The fee for each of the Services shall be as set forth on
Exhibit A. Purchaser shall invoice the Company monthly in arrears for any
Services provided by Purchaser in such month, and such invoices shall be due and
payable thirty (30) days from the invoice date. Upon any early termination of
any of the Services as set forth in Section 4.2, no further fees shall be owed
with respect to such Services.
3. Representations and Warranties.
3.1 Mutual Representations. Each party ("Warranting Party") represents
and warrants to the other party that the Warranting Party has full power
and authority to enter into this Agreement and that this Agreement has been
duly authorized, executed and delivered by the Warranting Party and
constitutes a valid, binding and legally enforceable agreement of the
Warranting Party, subject to bankruptcy, insolvency, reorganization or
other similar laws affecting or relating to enforcement of creditors'
rights generally and general equitable principles.
3.2 Indemnification. Each party ("Indemnifying Party") agrees to
defend, indemnify and hold harmless the other party from and against all
claims, demands, losses, costs, expenses, obligations, liabilities,
damages, recoveries and deficiencies, including interest, penalties and
reasonable attorneys' fees (including court costs and attorneys' reasonable
fees and expenses) arising from or in any manner connected with the
Indemnifying Party's actions or omissions with respect to the Services or
any breaches of any of the representations, warranties or covenants set
forth in this Agreement. The other party may participate in the defense of
any such claim at its expense.
4. Term and Termination.
4.1 Term. This Agreement shall remain in effect for ninety (90) days
following the date of this Agreement (the "Initial Term"); provided,
however, that upon fifteen (15) days prior written notice to Purchaser, the
Company may extend the term of this Agreement with respect to any or all
Services for an additional period, which shall not be more than an
additional ninety (90) days following the expiration of the Initial Term.
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4.2 Early Termination. Upon written notice, the Company may terminate
this Agreement or any one or more of the Services or, at its option,
suspend performance of any of the Services.
4.3 Services Independent. The Services shall be construed as a
separate and independent agreement for each and every Service arising from
each agreement set forth in Section 1. Any termination of this Agreement
with respect to a Service shall not terminate this Agreement with respect
to any other Service.
4.4 Cooperation Agreement. Upon notification of termination of a
Service, Purchaser shall cooperate with the Company to facilitate the
transition of the Services.
5. Nature of Relationship. The provisions of this Agreement shall not in
any respect whatsoever be deemed to create a partnership, joint venture or other
business combination between the Company and Purchaser.
6. Confidential Information. The parties each agree to maintain in
confidence, and not to use, disclose or divulge to any third party, any
Confidential Information (as defined herein) obtained by either party hereunder.
For the purposes of this Agreement, "Confidential Information" includes all
confidential or proprietary information of the disclosing party, including
information concerning the business of each of the parties disclosed by or on
behalf of one party to the other, and information, analyses, compilations,
studies or other documents relating to the Services. The term Confidential
Information does not include information which (i) is or becomes generally
available to the public other than as a result of disclosure by the receiving
party, (ii) was made available to the receiving party on a non-confidential
basis prior to disclosure by the disclosing party, (iii) was developed
independently by the receiving party without reference to Confidential
Information, (iv) became known to the receiving party through a third party not
bound by any obligation of confidentiality to the disclosing party; or (v) which
the receiving party is required or requested to provide pursuant to subpoena, or
demand by a government or governmental agency or authority; provided, however,
the receiving party promptly notifies the disclosing party of the subpoena or
demand to permit the disclosing party to take legally available steps to resist
or narrow the scope of such a subpoena or demand.
7. Injunctive Relief. The parties agree and acknowledge that money damages
may not be an adequate remedy for any breach of the provisions of this Agreement
and that any party may, in its sole discretion, apply for and secure specific
performance and/or injunctive relief, without bond, pending final resolution on
the merits in order to enforce or prevent any violations of the provisions of
this Agreement. Injunctive or other equitable relief shall not be the exclusive
remedy available to the parties.
8. Entire Agreement. This Agreement supersedes any and all other
agreements, oral or written, among the parties hereto with respect to the
subject matter hereof, and contains the entire agreement among the parties with
respect to the transactions contemplated hereby.
9. Amendments; Waiver. This Agreement may be amended, modified, superseded
or canceled and any of its provisions may be waived only by a written instrument
executed by all of the parties or, in the case of a waiver, by or on behalf of
the party waiving compliance. The failure of any party at any time to require
performance of any provision of this Agreement shall in no manner affect the
right of that party at a later time to enforce the same or a different
provision. No waiver by any party of any condition or of any breach of any
provision of this Agreement, in any one or more instances, shall be deemed to be
or construed as a further or continuing waiver of any such condition or of any
breach of the same or a different provision.
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10. Successors; Assignment. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
permitted transferees and assignees. Neither this Agreement nor any interest
herein may directly or indirectly be transferred or assigned by any party, in
whole or in part, without the written consent of the other parties, except that
the Company may effect any such assignment to a transferee of all or
substantially all of the assets of the Company or to any Affiliate of the
Company, but any such assignment shall not relieve the Company of its duties and
obligations contained in this Agreement.
11. Notices. Any notice, request, demand or other communication to be given
pursuant to the terms of this Agreement must be in writing and shall be deemed
to have been duly given on the day it is delivered by hand, on the day it is
sent by facsimile with confirmation of receipt by the transmitting facsimile
machine, on the next business day after it is sent by a nationally recognized
overnight mail service (delivery charge prepaid), or on the third business day
after it is mailed first class, postage prepaid, in each case to the following
addresses:
If to the Company: Lee Brass Company
1800 Golden Springs Road
Anniston, Alabama 36207
Attention: ______________
Facsimile: ______________
with copies to: Barnes & Thornburg LLP
601 Campau Square Plaza
99 Monroe Ave., NW
Grand Rapids, Michigan 49503
Attention: R. Paul Guerre, Esq.
Facsimile: 616-742-3999
If to Purchaser: Elkhart Products Corporation
c/o Aalberts Industries N.V.
Sandenburgerlaan 4
3947 CS Langbroek
Netherlands
Attention: Berend P. Bolkenstein
Facsimile: 011-31-343-565-081
4
with copies to: Fulbright & Jaworski L.L.P.
2200 Ross Avenue, Suite 2800
Dallas, Texas 75201
Attention: Harva R. Dockery, Esq.
Facsimile: 214-855-8200
or to such other address or to such other person as any party shall have last
designated by written notice provided to the other parties in the manner set
forth in this Section.
12. Severability. If any provision of this Agreement or any application
thereof shall be invalid or unenforceable, the remainder of this Agreement and
any other application of such provision shall not be affected thereby.
13. No Third-Party Beneficiary. This Agreement is for the benefit of, and
may be enforced only by, the Company and Purchaser and their respective
successors and permitted transferees and assignees, and is not for the benefit
of, and may not be enforced by, any third party.
14. Applicable Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of New York without regard to
conflict of law principles.
15. Arbitration. Subject to the indemnification provisions of this
Agreement:
(a) The parties agree that any and all disputes, claims or controversies
arising out of or relating to this Agreement or the breach, termination,
enforcement, interpretation or validity thereof, including the determination of
the scope or applicability of this agreement to mediate and arbitrate, shall be
mediated before a mediator agreeable to both parties or, if they cannot agree,
then before JAMS, or its successor. The mediation shall be conducted at a
mutually agreeable location or, if they cannot agree, then at the JAMS office in
Chicago, Illinois. Any party may commence mediation by providing to the other
parties a written request for mediation, setting forth the subject of the
dispute and the relief requested. The parties shall cooperate with one another
in selecting a mediator and in scheduling the mediation proceedings. The parties
covenant that they shall participate in the mediation in good faith, and that
they shall share equally in its costs. All offers, promises, conduct and
statements, whether oral or written, made in the course of the mediation by any
of the parties or their Representatives, and by the mediator or any JAMS
employees, are confidential, privileged and inadmissible for any purpose,
including impeachment, in any arbitration or other Action involving the parties,
provided that evidence that is otherwise admissible or discoverable shall not be
rendered inadmissible or non-discoverable as a result of its use in the
mediation.
(b) Any party may initiate arbitration with respect to the matters
submitted to mediation by filing a written demand for arbitration at any time
following the initial mediation session or 45 days after the date of filing the
written request for mediation, whichever occurs first. The mediation may
continue after the commencement of arbitration if the parties so desire. Unless
otherwise agreed by the parties, the mediator shall be disqualified from serving
as arbitrator in the case. Arbitration may be enforced by any court of competent
jurisdiction, and the party seeking enforcement shall be entitled to an award of
all costs, fees and expenses, including reasonable attorneys fees, to be paid by
the party or parties against whom enforcement is ordered.
5
(c) Any arbitration shall be conducted at a mutually agreeable location or,
if the parties cannot agree, in Chicago, Illinois. The arbitration shall be
before a sole arbitrator mutually selected by the parties or, if they cannot
agree, then before a retired judge to be selected by JAMS pursuant to its
Comprehensive Arbitration Rules and Procedures, who shall thereafter administer
the arbitration, provided however that JAMS shall identify the preceding ten
(10) arbitrations conducted by each arbitrator candidate and the lawyers
involved in the arbitration. The arbitration shall be conducted pursuant to the
foregoing rules except as set forth herein. The parties to the dispute shall be
permitted to conduct pre-hearing discovery in the form of depositions and
document production requests subject to the control of the arbitrator. The award
of the arbitrator shall be a reasoned award specifying all essential findings of
fact and conclusions of law necessary to support the award. Judgment on the
award may be entered in any court having jurisdiction. In any proceeding to
confirm the award, the court also shall have jurisdiction to review the award
for errors of law.
(d) The cost of the arbitration shall initially be borne equally by the
parties. In the award the arbitrator shall allocate, consistent with the
indemnification provisions of this Agreement, all of the costs of the
arbitration (and the mediation, if applicable), including the fees of the
arbitrator and the reasonable attorneys' fees of the prevailing party, against
the party or parties who did not prevail.
16. Counterparts. This Agreement may be executed in two or more
counterparts and by the parties on separate counterparts, all of which shall be
considered one and the same instrument, and each of which shall be deemed an
original. Each of the parties hereto (i) has agreed to permit the use, from time
to time, of faxed or otherwise electronically transmitted signatures in order to
expedite the consummation of the transactions contemplated hereby, (ii) intends
to be bound by its respective faxed or otherwise electronically transmitted
signature, (iii) is aware that the other parties hereto shall rely on the faxed
or otherwise electronically transmitted signature, and (iv) acknowledges such
reliance and waives any defenses to the enforcement of the documents effecting
the transaction contemplated by this Agreement based on the fact that a
signature was sent by fax or otherwise electronically transmitted.
17. Headings; Construction. The headings of the sections and paragraphs in
this Agreement have been inserted for convenience of reference only and shall
not restrict or otherwise modify any of the terms or provisions of this
Agreement. Unless otherwise expressly provided, the words "including" or
"includes" whenever used in this Agreement do not limit the preceding words or
terms. With regard to all dates and time periods set forth or referred to in
this Agreement, time is of the essence.
18. Consent to Service of Process and Jurisdiction. Purchaser and the
Company agree that, in the event it becomes necessary for any party to enforce
any provision of this Agreement or any arbitration award obtained pursuant to
Section 15 of this Agreement by legal action, the parties hereby consent that
suit may be brought hereunder in any court of appropriate jurisdiction in
Elkhart County, Indiana, U.S.A., or in the United States District Court for the
Northern District of Indiana, regardless of the state, county or country in
which any party may reside or have such parties domicile (corporate or
individual) at the time of any such action. Purchaser and the Company consent to
service of process and other notices given or required in any proceedings
submitted to arbitration by either party pursuant to the provisions of Section
15 by personal delivery or by registered mail addressed to such party at the
addresses set out in Section 11. However, any party may serve legal process in
any other manner permitted by Law or the rules of the American Arbitration
Association.
6
Purchaser and the Company have caused this Transition Services Agreement to
be fully executed as of the date first set forth above.
ELKHART PRODUCTS CORPORATION
(a Delaware corporation)
By
-----------------------------
Its
----------------------
"Purchaser"
Lee Brass Company
By
-----------------------------
Its
----------------------
"Company"
7
EXHIBIT A
Service Fee
IT Services
Sales Services
Purchasing Services
HR Services
Accounting Services
8
OPINION OF FULBRIGHT & JAWORSKI L.L.P.
AND OTHER COUNSEL, AS APPLICABLE
Section 1. Each Buying Party is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization.
Section 2. Each Buying Party has all requisite corporate power and
authority to enter into, deliver and perform the Agreement and each agreement
that is an exhibit to the Agreement and to which it is a party and [name any
other specified closing agreements] (the "Subject Agreements") to which it is a
party and to consummate the transactions described in the Agreement and the
Subject Agreements. Each of the Agreement and the Subject Agreements to which it
is a party (including the transactions described therein) has been authorized by
all necessary corporate action on the part of each Buying Party and has been
duly executed and delivered by each Buying Party pursuant to all necessary
corporate action.
Section 3. Neither the execution and delivery by each Buying Party of the
Agreement and the Subject Agreements, the consummation of the transactions
described in the Agreement and the Subject Agreements by each Buying Party, nor
compliance by each Buying Party with any of the provisions of the Agreement and
the Subject Agreements will result in a violation or breach of or constitute a
default under (a) its certificate of incorporation or bylaws (or analogous
documents), (b) any material contract, agreement or other commitment of the
Purchasers or, to counsel's knowledge, Parent, or (c) any Law applicable to a
Buying Party or to counsel's knowledge, any court or administrative order by
which a Buying Party is subject or bound.
Section 4. Except for filings required to be made pursuant to the HSR Act
and Dutch securities Laws, no Buying Party is required to submit any notice,
report or other filing with any governmental or regulatory authority or
instrumentality in connection with the execution, delivery or performance of the
Agreement and the Subject Agreements by the Buying Parties and the consummation
of the transactions described in the Agreement and the Subject Agreements.
Section 5. Each of the Agreements and the Subject Agreements is the legal,
valid and binding obligation of the Buying Party to which it is a party; and
except as may be limited by principles of equity or bankruptcy, insolvency,
reorganization, moratorium or other similar laws or judicial decisions relating
to or affecting the enforcement of creditors' rights, is enforceable against the
Buying Parties in accordance with its terms.
1
SUPPLY AGREEMENT
THIS SUPPLY AGREEMENT ("Agreement") is made as of July 30, 2004, between Elkhart
Products Corporation, a Delaware corporation ("Purchaser"), and Lee Brass
Company, a Delaware corporation (the "Supplier").
RECITALS
A. WHEREAS, pursuant to an Asset Purchase Agreement (the "Purchase Agreement"),
dated as of July 8, 2004, by and among Purchaser, certain affiliates of
Purchaser and certain affiliates of Supplier, Purchaser is acquiring
substantially all of the assets of certain affiliates of Supplier.
B. WHEREAS, it is a condition to the closing of the transactions contemplated by
the Purchase Agreement that Supplier and Purchaser contemporaneously enter into
this Agreement.
C. WHEREAS, capitalized terms used in this Agreement without definition shall
have the respective meanings given to them in the Purchase Agreement.
D. WHEREAS, Purchaser desires to purchase from Supplier, and Supplier is willing
to supply to Purchaser, the products described below on the terms and conditions
set forth herein.
NOW, THEREFORE, for and in consideration of the mutual promises and covenants
herein contained and for other good and valuable consideration, the receipt and
adequacy of which hereby are acknowledged, the parties hereto agree as follows:
Section 6. Supply of Products.
6.1. Subject to the provisions of this Agreement, during the term of this
Agreement, Supplier shall sell to Purchaser, and Purchaser shall purchase from
Supplier, all of Purchaser's requirements of the products listed on Exhibit A,
including any future improvements, next generation designs and upgrades on such
products (collectively, the "Products"), so long as Supplier determines in its
discretion to continue to manufacture brass fittings. The specifications for the
Products shall be consistent with current industry standards.
6.2. Purchaser may not cancel any order for Products without Supplier's
written consent and full indemnification of Supplier from any Losses that arise,
result from or relate to such cancellation.
6.3. Supplier shall not be liable for any failure to perform its
obligations hereunder if (and during such time as) such failure is due to causes
beyond the reasonable control of Supplier; provided, however, if Supplier is
unable to perform because of causes beyond its reasonable control it shall
provide notice to Purchaser of such inability as promptly as practicable under
the circumstances. The notice shall specify the extent to and time during which
Supplier expects to be unable to manufacture or supply the Products. Supplier
shall provide Purchaser with reasonable aid and assistance in securing an
alternate supply of Products, including providing Purchaser or an alternate
supplier with access to dies, tooling and other pattern equipment used by
Supplier to perform this Agreement for as long as Supplier is unable to
manufacture the Products. During any such period Purchaser shall be excused from
the purchase obligations set forth in this Agreement or any purchase order under
this Agreement. Supplier shall provide notice to Purchase of the conclusion of
such period of inability to perform, upon which time the sale obligations set
forth in this Agreement shall once again be in full force and effect.
1
6.4. Supplier shall perform its obligations under this Agreement in a
manner that is consistent with Supplier's historical quality.
Section 7. Term and Termination.
7.1. The term of this Agreement shall commence on the date of the execution
of this Agreement and continue for a period of two (2) years thereafter, unless
earlier terminated as set forth below and may be renewed upon written agreement
of Purchaser and Supplier.
7.2. At any time during the term of this Agreement either party may
terminate this Agreement: (i) if the other party materially breaches any
obligation hereunder and such breach is not cured within 60 days after delivery
of written notice to the other party specifying the nature of the material
breach; (ii) if a trustee in bankruptcy or receiver or similar entity is
appointed for the other party; or (iii) subject to the provisions of Section 17,
if the other party ceases or terminates the operation of business. For purposes
of this Section 2(b), a delivery by Supplier that is not timely made shall be
deemed a "material breach".
7.3. If Purchaser fails to pay any amounts due hereunder within 20 days
after delivery of written notice from Supplier to Purchaser of the failure to
pay by the payment date, Supplier may terminate this Agreement.
7.4. The exercise by either party of any right of termination under this
Agreement shall not (i) constitute a waiver of any other rights or remedies
available to such party for violation of the terms of this Agreement; or (ii)
affect any orders for Products accepted by Supplier but not delivered as of the
effective date of termination.
Section 8. Price and Terms. The purchase price for each of the Products
ordered from Supplier by Purchaser shall be at the net negotiated prices that
were in effect as of the date of the Purchase Agreement between the Company and
its affiliate Elkhart Products Corporation, an Indiana corporation, with respect
to such Products, plus a metal market-based surcharge determined consistent with
the past practice of the Company and its affiliate Elkhart Products Corporation,
an Indiana corporation, with respect to such Products. All payments are to be
made in U.S. dollars against funds in the United States. Other terms and
conditions of sale for each purchase of Products by Purchaser shall be as set
forth in this Agreement or as agreed in writing by the parties with respect to
that particular purchase. Any and all sales, use and other taxes and delivery
charges are in addition to the purchase price and shall be paid by Purchaser
unless Purchaser supplies Supplier with an applicable exemption certificate for
any such taxes. Payment terms are 2%, 15 days, net 45 days. If Purchaser fails
to pay the purchase price for the Products when due or has any unpaid purchase
price outstanding, Supplier may (i) alter or suspend credit terms for Purchaser,
(ii) demand cash payments or security from Purchaser prior to shipment, (iii)
accelerate amounts due under any outstanding invoices, (iv) take possession of
goods and stop goods in transit, suspend or terminate outstanding orders and
deliveries, and (v) take other action, whether under this Agreement, applicable
law or otherwise, that Supplier determines in its discretion is warranted due to
the financial condition of Purchaser or Purchaser's nonpayment of any invoice
when due or other breach of any provision of this Agreement or other terms of
purchase agreed to by Purchaser and Seller as permitted by this Agreement.
2
Section 9. Freight Terms. All purchases hereunder shall be F.O.B.
Supplier's plant. Shipments shall be in Purchaser's standard packaging.
Purchaser shall pay all shipping costs from Supplier's plant to Purchaser's
destination of choice. Shipment method and route shall be determined by
Purchaser.
Section 10. Delivery. Purchaser and Supplier shall agree on a delivery
schedule and Supplier shall use its reasonable efforts to comply with such
schedule, subject to the other terms of this Agreement. All risk of loss of or
damage to the Products while in transit to Purchaser's destination of choice
shall be the responsibility of Purchaser.
Section 11. Intellectual Property. Any goodwill and other rights associated
with Purchaser's trademarks, service marks, brand names or trade, corporate or
business names ("Purchaser's Marks") arising as a result of Purchaser's sale of
the Products containing or including Purchaser's Marks shall inure to the sole
benefit of Purchaser. Any goodwill and other rights associated with Supplier's
trademarks, service marks, brand names or trade, corporate or business names
("Supplier's Marks") arising as a result of Purchaser's sale of the Products
containing or including Supplier's Marks shall inure to the sole benefit of
Supplier.
Section 12. Acceptance and Returned Goods. Purchaser shall, within sixty
(60) days after the delivery of the Products, inspect the Products to determine
whether they are damaged and whether they conform to the terms of the applicable
order. If Purchaser determines that any Products are damaged or do not conform
to the applicable purchase order, in each case other than resulting from the
shipment of the Products (a "Nonconformance"), Purchaser shall provide written
notice to Supplier describing the Nonconformance. Products that have a
Nonconformance may be rejected by Purchaser and returned to Supplier for credit
or replacement, at Supplier's option, with Supplier bearing the cost of
shipment, freight delivery and risk of loss of or damage to such returned
Products.
Section 13. Export. Purchaser must have obtained an export license prior to
the delivery of export Products. All export sales are subject to Revised
American Foreign Trade definitions. Supplier reserves all rights to any Drawback
of U.S. Customs Duties, if obtainable.
Section 14. Confidential Information. The parties each agree to maintain in
confidence, and not to use, disclose or divulge to any third party, any
Confidential Information (as defined herein) obtained by either party hereunder
or in conjunction with the manufacture and supply of Product by Supplier to
Purchaser pursuant to this Agreement. For the purposes of this Agreement,
Confidential Information includes all confidential or proprietary information of
the disclosing party, including information concerning the business of each of
the parties disclosed by or on behalf of one party to the other, and
information, analyses, compilations, studies or other documents relating to the
design, manufacture, marketing, sale and distribution of Product. The term
Confidential Information does not include information which, (i) is or becomes
generally available to the public other than as a result of disclosure by the
receiving party, (ii) was made available to the receiving party on a
non-confidential basis prior to disclosure by the disclosing party, (iii) was
developed independently by the receiving party without reference to Confidential
Information, (iv) became known to the receiving party through a third party not
bound by any obligation of confidentiality to the disclosing party; or (v) which
the receiving party is required or requested to provide pursuant to subpoena, or
demand by a government or governmental agency or authority; provided, however,
the receiving party promptly notifies the disclosing party of the subpoena or
demand to permit the disclosing party to take legally available steps to resist
or narrow the scope of such a subpoena or demand. This Section shall survive any
termination of this Agreement.
3
Section 15. Injunctive Relief. The parties agree and acknowledge that money
damages may not be an adequate remedy for any breach of the provisions of this
Agreement and that any party may, in its sole discretion, apply for and secure
specific performance and/or injunctive relief, without bond, pending final
resolution on the merits in order to enforce or prevent any violations of the
provisions of this Agreement. Injunctive or other equitable relief shall not be
the exclusive remedy available to the parties.
Section 16. Nature of Relationship. The provisions of this Agreement shall
not in any respect whatsoever be deemed to create a partnership, joint venture
or other business combination between Purchaser and Supplier.
Section 17. Indemnification. Supplier shall indemnify, defend and hold
harmless Purchaser from and against and in respect of any and all Losses that
Purchaser may incur or suffer, which arise, result from or relate to product
liability claims asserted against Purchaser as a result of Supplier's defective
manufacture of Products; provided, however, that Supplier shall have no
obligation to indemnify, defend and hold harmless Purchaser for or with respect
to Supplier's manufacture of Products if (i) the parties agree to use
Purchaser's specifications, and the applicable Products were in compliance with
Purchaser's specifications or (ii) the applicable Products were in compliance
with industry standards. Purchaser shall indemnify, defend and hold harmless
Supplier from and against and in respect of any and all Losses that Supplier may
incur or suffer, which arise, result from or relate to product liability claims
relating to the Products asserted against Supplier as a result of (x) Supplier's
manufacture of Products in compliance with Purchaser's specifications, if any;
(y) the shipment of the Products by Supplier from its facility; or (z)
Purchaser's handling or sale of the Products after the Products have been
transferred to Purchaser.
Section 18. Warranty.
18.1. If the Products furnished by Supplier prove defective due to defects
in manufacture or non-conformance with industry standards or any other
specifications agreed to by Purchaser and Supplier in writing, Supplier shall,
in lieu of other claims against it, upon due notice within a period of one year
after date of shipment, replace it F.O.B. original point of delivery, or credit,
at Supplier's option, on return to Supplier's plant of the defective material,
but Supplier shall not be liable for any Losses arising in connection with, or
by reason of Purchaser's use of, or inability to use, such Products for any
purpose whatsoever.
18.2. In addition to the limitations set forth above, Supplier makes no
warranties with respect to claims, problems or defects which are the result of
Purchaser's specifications, if any, normal wear and tear, mishandling, misuse,
neglect or improper repair by a person other than Supplier or its authorized
representative. In addition, except as set forth in Section 13(a), SUPPLIER
EXPRESSLY DISCLAIMS, AND PURCHASER WAIVES, ALL OTHER REPRESENTATIONS AND
WARRANTIES, EXPRESS, IMPLIED, STATUTORY OR ARISING BY COURSE OF DEALING OR
PERFORMANCE, CUSTOM, USAGE IN THE TRADE OR OTHERWISE, INCLUDING THE IMPLIED
WARRANTIES OF MERCHANTABILITY, TITLE AND FITNESS FOR A PARTICULAR USE.
4
Section 19. Limitation of Liability. NOTWITHSTANDING ANY OTHER TERM OF THIS
AGREEMENT, NO PARTY SHALL BE LIABLE TO THE OTHER, WHETHER IN CONTRACT OR IN
TORT, FOR SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND,
INCLUDING CLAIMS FOR LOST PROFITS OR LOSS OF GOODWILL, EVEN IF THAT PARTY HAS
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, BY REASON OF ANY BREACH OR
DEFAULT UNDER THIS AGREEMENT.
Section 20. Entire Agreement. This Agreement supersedes any and all other
agreements, oral or written, among the parties hereto with respect to the
subject matter hereof, and contains the entire agreement among the parties with
respect to the transactions contemplated hereby.
Section 21. Amendments; Waiver. This Agreement may be amended, modified,
superseded or canceled and any of its provisions may be waived only by a written
instrument executed by all of the parties or, in the case of a waiver, by or on
behalf of the party waiving compliance. The failure of any party at any time to
require performance of any provision of this Agreement shall in no manner affect
the right of that party at a later time to enforce the same or a different
provision. No waiver by any party of any condition or of any breach of any
provision of this Agreement, in any one or more instances, shall be deemed to be
or construed as a further or continuing waiver of any such condition or of any
breach of the same or a different provision.
Section 22. Successors; Assignment. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and permitted transferees and assignees. Neither this Agreement nor any interest
herein may directly or indirectly be transferred or assigned by any party, in
whole or in part, without the written consent of the other parties, except that
Supplier may effect any such assignment to a transferee of all or substantially
all of the assets of Supplier or to any Affiliate of Supplier, but any such
assignment shall not relieve Supplier of its duties and obligations contained in
this Agreement.
Section 23. Notices. Any notice, request, demand or other communication to
be given pursuant to the terms of this Agreement must be in writing and shall be
deemed to have been duly given on the day it is delivered by hand, on the day it
is sent by facsimile with confirmation of receipt by the transmitting facsimile
machine, on the next business day after it is sent by a nationally recognized
overnight mail service (delivery charge prepaid), or on the third business day
after it is mailed first class, postage prepaid, in each case to the following
addresses:
5
If to Purchaser: Lee Brass Company
1800 Golden Springs Road
Anniston, Alabama 36207
Attention: David R. Smith
Facsimile: 256-831-8380
with copies to: Barnes & Thornburg LLP
601 Campau Square Plaza
99 Monroe Ave., NW
Grand Rapids, Michigan 49503
Attention: R. Paul Guerre, Esq.
Facsimile: 616-742-3999
If to Supplier: Elkhart Products Corporation
c/o Aalberts Industries N.V.
Sandenburgerlaan 4
3947 CS Langbroek
Netherlands
Attention: Berend P. Bolkenstein
Facsimile: 011-31-343-565-081
with copies to: Fulbright & Jaworski L.L.P.
2200 Ross Avenue, Suite 2800
Dallas, Texas 75201
Attention: Harva R. Dockery, Esq.
Facsimile: 214-855-8200
or to such other address or to such other person as any party shall have last
designated by written notice provided to the other parties in the manner set
forth in this Section.
Section 24. Severability. If any provision of this Agreement or any
application thereof shall be invalid or unenforceable, the remainder of this
Agreement and any other application of such provision shall not be affected
thereby.
Section 25. No Third Party Beneficiary. This Agreement is for the benefit
of, and may be enforced only by, Purchaser and Supplier and their respective
successors and permitted transferees and assignees, and is not for the benefit
of, and may not be enforced by, any third party.
Section 26. Applicable Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of New York
without regard to conflict of law principles.
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Section 27. Arbitration. Subject to the indemnification provisions set
forth in this Agreement:
27.1. The parties agree that any and all disputes, claims or controversies
arising out of or relating to this Agreement or the breach, termination,
enforcement, interpretation or validity thereof, including the determination of
the scope or applicability of this agreement to mediate and arbitrate, shall be
mediated before a mediator agreeable to both parties or, if they cannot agree,
then before JAMS, or its successor. The mediation shall be conducted at a
mutually agreeable location or, if they cannot agree, then at the JAMS office in
Elkhart, Indiana. Any party may commence mediation by providing to the other
parties a written request for mediation, setting forth the subject of the
dispute and the relief requested. The parties shall cooperate with one another
in selecting a mediator and in scheduling the mediation proceedings. The parties
covenant that they shall participate in the mediation in good faith, and that
they shall share equally in its costs. All offers, promises, conduct and
statements, whether oral or written, made in the course of the mediation by any
of the parties or their Representatives, and by the mediator or any JAMS
employees, are confidential, privileged and inadmissible for any purpose,
including impeachment, in any arbitration or other Action involving the parties,
provided that evidence that is otherwise admissible or discoverable shall not be
rendered inadmissible or non-discoverable as a result of its use in the
mediation.
27.2. Any party may initiate arbitration with respect to the matters
submitted to mediation by filing a written demand for arbitration at any time
following the initial mediation session or 45 days after the date of filing the
written request for mediation, whichever occurs first. The mediation may
continue after the commencement of arbitration if the parties so desire. Unless
otherwise agreed by the parties, the mediator shall be disqualified from serving
as arbitrator in the case. Arbitration may be enforced by any court of competent
jurisdiction, and the party seeking enforcement shall be entitled to an award of
all costs, fees and expenses, including reasonable attorneys fees, to be paid by
the party or parties against whom enforcement is ordered.
27.3. Any arbitration shall be conducted at a mutually agreeable location
or, if the parties cannot agree, in Elkhart, Indiana. The arbitration shall be
before a sole arbitrator mutually selected by the parties or, if they cannot
agree, then before a retired judge to be selected by JAMS pursuant to its
Comprehensive Arbitration Rules and Procedures, who shall thereafter administer
the arbitration, provided however that JAMS shall identify the preceding ten
(10) arbitrations conducted by each arbitrator candidate and the lawyers
involved in the arbitration. The arbitration shall be conducted pursuant to the
foregoing rules except as set forth herein. The parties to the dispute shall be
permitted to conduct pre-hearing discovery in the form of depositions and
document production requests subject to the control of the arbitrator. The award
of the arbitrator shall be a reasoned award specifying all essential findings of
fact and conclusions of law necessary to support the award. Judgment on the
award may be entered in any court having jurisdiction. In any proceeding to
confirm the award, the court also shall have jurisdiction to review the award
for errors of law.
27.4. The cost of the arbitration shall initially be borne equally by the
parties. In the award the arbitrator shall allocate, consistent with the
indemnification provisions of this Agreement, all of the costs of the
arbitration (and the mediation, if applicable), including the fees of the
arbitrator and the reasonable attorneys' fees of the prevailing party, against
the party or parties who did not prevail.
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Section 28. Counterparts. This Agreement may be executed in two or more
counterparts and by the parties on separate counterparts, all of which shall be
considered one and the same instrument, and each of which shall be deemed an
original. Each of the parties hereto (i) has agreed to permit the use, from time
to time, of faxed or otherwise electronically transmitted signatures in order to
expedite the consummation of the transactions contemplated hereby, (ii) intends
to be bound by its respective faxed or otherwise electronically transmitted
signature, (iii) is aware that the other parties hereto shall rely on the faxed
or otherwise electronically transmitted signature, and (iv) acknowledges such
reliance and waives any defenses to the enforcement of the documents effecting
the transaction contemplated by this Agreement based on the fact that a
signature was sent by fax or otherwise electronically transmitted.
Section 29. Headings; Construction. The headings of the sections and
paragraphs in this Agreement have been inserted for convenience of reference
only and shall not restrict or otherwise modify any of the terms or provisions
of this Agreement. Unless otherwise expressly provided, the words "including" or
"includes" whenever used in this Agreement do not limit the preceding words or
terms. With regard to all dates and time periods set forth or referred to in
this Agreement, time is of the essence.
Section 30. Consent to Service of Process and Jurisdiction. Supplier and
Purchaser agree that, in the event it becomes necessary for any provision of
this Agreement or any arbitration award obtained pursuant to Section 21 of this
Agreement by legal action, the parties hereby consent that suit may be brought
hereunder in any court of appropriate jurisdiction in Elkhart, Indiana, U.S.A.,
or in the United States District Court for the Northern District of Indiana,
regardless of the state, county or country in which any party may reside or have
such parties domicile (corporate or individual) at the time of any such action.
Supplier and Purchaser consent to service of process and other notices given or
required in any proceedings submitted to arbitration by either party pursuant to
the provisions of Section 21 by personal delivery or by registered mail
addressed to such party at the addresses set out in Section 17. However, any
party may serve legal process in any other manner permitted by Law or the rules
of the American Arbitration Association.
Supplier and Purchaser have caused this Supply Agreement to be duly executed as
of the date first set forth above.
ELKHART PRODUCTS CORPORATION
(A Delaware Corporation)
By: _____________________________
Its: ____________________________
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LEE BRASS COMPANY
By: _____________________________
Joseph R. Grewe, President
9
EXHIBIT A
PRODUCTS
10
OPINION OF BARNES & THORNBURG LLP
AND OTHER SPECIAL JURISDICTIONAL COUNSEL,
AS APPLICABLE
Subject to customary qualifications, limitations and exceptions:
Section 31. Each Seller is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction under which it was
formed and has the corporate power and authority to own, lease or operate the
Acquired Assets as now owned, leased or operated by that Seller in all material
respects. Except as set forth in the Disclosure Letter to the Agreement, each
Seller is duly qualified to conduct its business and is in good standing in each
jurisdiction in which the Acquired Assets are owned, leased or operated by that
Seller or the nature of the operation of the Business operated by that Seller
requires that Seller to qualify to transact business as a foreign corporation,
other than any jurisdiction in which the failure to be so registered would not
reasonably be expected to have a Material Adverse Effect.
Section 32. Each Seller has all requisite corporate power and authority to
enter into, deliver and perform the Agreement and each agreement that is an
exhibit to the Agreement and [name any other specified closing agreements] (the
"Subject Agreements") to which it is a party and to consummate the transactions
described in the Agreement and the Subject Agreements. Each of the Agreements
and the Subject Agreements (including the transactions described therein) to
which it is a party has been duly authorized by all necessary corporate action
on the part of each Seller and has been duly executed and delivered by each
Seller pursuant to all necessary corporate action.
Section 33. Except as disclosed in the Disclosure Letter to the Agreement,
neither the execution and delivery by each Seller of the Agreement and the
Subject Agreements to which it is a party, the consummation by each Seller of
the transactions described in the Agreement and the Subject Agreements to which
it is a party, nor compliance by each Seller with any other provisions of the
Agreement and the Subject Agreements to which it is a party, will result in a
violation or breach of, or constitute a default under (a) its charter or bylaws
(or analogous documents), (b) any Material Contracts or (c) any Law applicable
to a Seller or, to counsel's knowledge, court or administrative order by which a
Seller is subject or bound.
Section 34. Except for filings required to be made pursuant to the HSR Act
and the federal securities laws of the United States and except as disclosed in
the Disclosure Letter to the Agreement, no Seller is required to submit any
notice, report or other filing with any governmental or regulatory authority or
instrumentality in connection with the execution, delivery or performance of the
Agreement and the Subject Agreements by the Sellers and the consummation of the
transactions described in the Agreement and the Subject Agreements.
Section 35. Each of the Agreements and the Subject Agreements is the legal,
valid and binding obligation of each Seller who is a party thereto; and, except
as may be limited by principles of equity or bankruptcy, insolvency,
reorganization, moratorium or other similar laws or judicial decision relating
to or affecting the enforcement of creditors' rights, is enforceable against
each Seller in accordance with its terms.
1
Section 36. To our knowledge and except as described in the Disclosure
Letter to the Agreement, (1) there is no suit, action, proceeding, investigation
or claim pending or threatened against and affecting the Business in any court
or before any Forum or by any Government and (2) there is no outstanding order,
writ, injunction, decree, judgment or award by any court, arbitration panel or
Government against any Seller and adversely affecting the Business.
2
BILL OF SALE
KNOW ALL MEN BY THESE PRESENTS that Amcast Industrial Ltd., a Canadian
corporation ("Amcast Canada"), for good and valuable consideration paid to it by
Elkhart Products Ltd., a Canadian corporation ("Elkhart-Canada"), pursuant to
that certain Asset Purchase Agreement between Amcast Canada, Amcast Industrial
Corporation, an Ohio corporation, Elkhart Products Corporation, an Indiana
corporation, Aalberts Industries U.S. Holding Corp., a Delaware corporation,
Elkhart Products Corporation, a Delaware corporation and Elkhart-Canada, dated
July 8, 2004 (the "Asset Purchase Agreement"), receipt of which is hereby
acknowledged by Amcast Canada, does by these presents assign, transfer, convey
and deliver unto Elkhart-Canada, its successors and assigns, all of the rights,
title and interests to the assets and rights described in Section 1.1 of the
Asset Purchase Agreement (other than the Excluded Assets, as defined in the
Asset Purchase Agreement) of Amcast-Canada, to have and to hold unto
Elkhart-Canada, its successors and assigns.
This Bill of Sale is made pursuant to and upon the terms and conditions
contained in the Asset Purchase Agreement.
IN WITNESS WHEREOF, Amcast-Canada has caused this Bill of Sale to be executed by
its respective duly authorized representatives on July 30, 2004.
Amcast Industrial Ltd.
By: ______________________
Joseph R. Grewe, President
1
BILL OF SALE
KNOW ALL MEN BY THESE PRESENTS that Amcast Industrial Corporation, an Ohio
corporation ("Amcast"), and Elkhart Products Corporation, an Indiana corporation
("Elkhart-Indiana"), for good and valuable consideration paid to them by Elkhart
Products Corporation, a Delaware corporation ("Elkhart-Delaware"), pursuant to
that certain Asset Purchase Agreement between Amcast, Elkhart-Indiana and Amcast
Industrial Ltd., a Canadian corporation, Aalberts Industries U.S. Holding Corp.,
a Delaware corporation, Elkhart Products, Ltd., a Canadian corporation, and
Elkhart-Delaware, dated July 8, 2004 (the "Asset Purchase Agreement"), receipt
of which is hereby acknowledged by Amcast and Elkhart-Indiana, do by these
presents assign, transfer, convey and deliver unto Elkhart-Delaware, its
successors and assigns, all of the rights, title and interests to the assets and
rights described in Section 1.1 of the Asset Purchase Agreement (other than the
Excluded Assets, as defined in the Asset Purchase Agreement) of Amcast and
Elkhart-Indiana, to have and to hold unto Elkhart-Delaware, its successors and
assigns.
This Bill of Sale is made pursuant to and upon the terms and conditions
contained in the Asset Purchase Agreement.
IN WITNESS WHEREOF, each of Amcast and Elkhart-Indiana has caused this Bill of
Sale to be executed by its respective duly authorized representatives on July
30, 2004.
Amcast Industrial CORPORATION
By: _________________________
Joseph R. Grewe, President
ELKHART PRODUCTS CORPORATION
By: _________________________
Joseph R. Grewe, President
1
INSTRUMENT OF ASSUMPTION
THIS INSTRUMENT OF ASSUMPTION dated July 30, 2004, is entered into by and among
Amcast Industrial Corporation, an Ohio corporation, Elkhart Products
Corporation, an Indiana corporation, and Amcast Industrial Ltd., a Canada
corporation ("Sellers") and Aalberts Industries U.S. Holding Corp., Elkhart
Products Corporation, a Delaware corporation ("Elkhart-Delaware"), and Elkhart
Products Ltd., a Canadian corporation ("Elkhart-Canada"), and Aalberts
Industries U.S. Holding Corp., a Delaware corporation (together with
Elkhart-Delaware and Elkhart-Canada, the "Buying Parties").
WITNESSETH:
WHEREAS, pursuant to that certain Asset Purchase Agreement dated July 8, 2004 by
and among the Buying Parties and Sellers (the "Asset Purchase Agreement"),
Sellers have agreed to sell, transfer, and assign certain of Sellers' assets to
Elkhart-Delaware and Elkhart-Canada; and
WHEREAS, pursuant to the Agreement, the Buying Parties have agreed to assume
certain liabilities of the Sellers; and
WHEREAS, all of the instruments, documents and agreements required to be
executed and delivered in order to consummate the transactions provided in the
Asset Purchase Agreement are being executed and delivered by and to the
respective parties to the Asset Purchase Agreement concurrently herewith.
NOW, THEREFORE, in consideration of the premises and the transfer by Sellers
concurrently herewith of the Acquired Assets in accordance with and pursuant to
the Asset Purchase Agreement:
The Buying Parties agree to assume and hereby assume, on the date hereof, and to
pay, perform or discharge in full the Assumed Liabilities, when due in
accordance with the provisions of the Asset Purchase Agreement.
The assignments and assumptions made hereunder are made in accordance with and
subject to the provisions contained in the Asset Purchase Agreement. Unless
otherwise defined herein, capitalized terms used herein shall have the meanings
ascribed to them in the Asset Purchase Agreement.
This Instrument of Assumption may be executed by the parties in separate
counterparts, each of which when so executed and delivered shall be an original,
but all such counterparts shall together constitute one and the same instrument.
This Instrument of Assumption shall be governed by and construed in accordance
with the laws of the State of New York
1
IN WITNESS WHEREOF, the parties to this Instrument of Assumption have caused
this Instrument of Assumption to be duly executed by their respective authorized
officers as of the day and year first above written.
ELKHART PRODUCTS CORPORATION,
a Delaware corporation
By:
-------------------------------------------
Name:
-----------------------
Title:
-----------------------
ELKHART PRODUCTS LTD.,
a Canadian Corporation
By:
--------------------------------------------
Name:
-----------------------
Title:
-----------------------
AALBERTS INDUSTRIES U.S. HOLDING CORP.,
a Delaware corporation
By:
-------------------------------------------
Name:
-----------------------
Title:
-----------------------
2