Exhibit 2.2
AMENDMENT NO. 1
TO
ASSET PURCHASE AGREEMENT
This Amendment No. 1 (the "Amendment") to the Asset Purchase Agreement
dated as of February 8, 2002 (the "Original Purchase Agreement") is made and
entered into as of March 15, 2002 by and among C.M. Offray & Son, Inc., a New
York corporation ("Offray"), Lion Ribbon Company, Inc., a New York corporation
("Lion"), CVO Corporation (Delaware), a Delaware corporation ("CVO"), C.M. & Son
Offray Limited, a company organized under the laws of the United Kingdom
("Offray UK"), C.M. Offray Europe, a company organized under the laws of the
Republic of Ireland ("Offray Ireland"), Offray Ribbon Canada, Inc., a company
organized under the laws of Canada ("Offray Canada"), C.M. Offray & Son (Hong
Kong) Limited, a company organized under the laws of Hong Kong ("Offray Hong
Kong" and together with Offray, Lion, CVO, Offray UK, Offray Ireland, Offray
Canada, and Offray Hong Kong, the "Sellers"), Claude V. Offray, Jr., an
individual and the sole or majority stockholder of each of the Sellers (the
"Major Stockholder"), Claude V. Offray III and Denise A. Offray (together with
the Major Stockholder, the "Stockholders"), on the one hand, and Daylight
Acquisition Corp., a Delaware corporation (the "Purchaser") and Berwick
Industries LLC, a Pennsylvania limited liability company and the sole
stockholder of the Purchaser (the "Parent"), on the other.
BACKGROUND
WHEREAS, the Sellers, the Stockholders, the Purchaser and the Parent
entered into the Original Purchase Agreement and now desire to make certain
amendments to the Original Purchase Agreement pursuant to the terms of this
Amendment.
NOW, THEREFORE, in consideration of the mutual covenants herein, and
intending to be legally bound hereby, the parties agree as follows:
1. The Original Purchase Agreement is hereby amended as follows:
1.1 Section 1.4(b)(vii) is hereby replaced in its entirety with the
following:
"(vii) any liabilities or obligations of the Sellers or the Business to
the Sellers' current or former employees (except to the extent expressly
included in Sections 1.4(a)(v), (vi) and (vii)), including without limitation
any liabilities or obligations of the Sellers or the Business arising out of or
regarding: (a) contributions due under, and/or any payments, benefits, or other
items payable from, a Benefit Plan attributable to the Sellers' current or
former employees; (b) agreements, contracts, or arrangements entered into with
individual current or former employees of the Sellers (except with respect to
the Foreign Employee Agreements as described in Section 4.1(d)) regarding
continuing streams of payment, provision of benefits, reimbursement obligations,
monthly pension arrangements, or any other item promised under such an
agreement, contract, or arrangement, regardless of whether the affected
employees become Hired Employees; provided that the Sellers shall be entitled to
certain reimbursement for certain severance obligations of Sellers pursuant to
Sections 4.1(i) and 4.1(j); (c) any obligations and responsibilities of the
Sellers or the Business to the Sellers' current or former employees with respect
to the Uniformed Services Employment and Reemployment Rights Act (other than
with respect to Hired Employees), COBRA and The Workers Adjustment Retraining
and Notification Act; (d) any incident or condition occurring prior to the
Closing giving rise to a workers compensation claim or disability claim
regardless of when reported; provided that the Sellers shall be entitled to
certain reimbursement pursuant to Section 4.1(g); (e) any medical expenses
incurred by any employee of the Sellers prior to the Closing regardless of when
reported; and (f) the Welch v. Offray litigation described on Schedule 2.15."
1.2 Section 4.1(g) is hereby replaced in its entirety with the
following:
(g) The Purchaser shall not be responsible for (i) any obligations with
respect to any individual who is or was an Employee, other than (A) accrued
vacation attributable to Hired Employees to the extent accrued on the Closing
Date Balance Sheet and determined in accordance with Schedule 4.1(g), which
schedule describes the amount owed to each Employee as of December 31, 2001 on
an employee-by-employee basis and will be updated through the Closing Date
(which updated Schedule will be delivered by the Sellers to the Purchaser
promptly following the Closing, but in no event later than thirty (30) days
after the Closing Date), and (B) the amounts described in Sections 4.1(h),
4.1(i) and 4.1(j), (ii) any claims (including without limitation workers
compensation and disability claims) regarding all injuries or illnesses
occurring prior to the Closing Date regardless of when reported, or (iii)
providing continuation health coverage as required under Part 6 of Subtitle B of
Title I of ERISA with respect to any individual who is or was an Employee, other
than continued health coverage obligations relating to (x) Hired Employees with
respect to benefit plans of the Purchaser in which a Hired Employee commences
participation after the Closing Date and (y) the Employees referred to in
Section 4.1(k)(i). Notwithstanding the foregoing, the Purchaser shall, upon
reasonable request of the Sellers, reimburse the Sellers for properly documented
payments actually made by Sellers after the Closing Date to, or on behalf of,
Hired Employees in connection with workers compensation claims, and disability
claims, in each case arising out of events occurring prior to the Closing Date
regardless of when reported and only to the extent accrued or reserved against
on the Closing Date Balance Sheet, but in no event more than (i) $800,000 for
workers compensation claims and (ii) $0 for disability claims.
1.3 The words "the Closing Date" in the third line of Section 4.1(i)
are hereby replaced with "March 13, 2002".
1.4 Section 4.1(k) is hereby replaced in its entirety with the
following:
(k) (i) The Purchaser shall provide continuation health coverage as
required under Part 6 of Subtitle B of Title I of ERISA with respect to any
individual who is an Employee as of the Closing Date, or was an employee prior
to the Closing Date, but does not become a Hired Employee (other than an
Excluded Employee), provided that either (A) such continuation coverage was
directly affected by the Closing, or (B) the qualifying event triggering such
continuation coverage is the sale of assets effectuated by this Agreement. In no
event, however, shall the Purchaser be responsible for the administration,
sponsorship or funding of the Sellers' health programs. The Purchaser shall
administer such continuation health coverage with respect to collection of
premiums and the termination of coverage on account of non-receipt of premiums
in a manner consistent with the manner in which the Purchaser administers COBRA
coverage for its employees generally. The Purchaser shall establish premiums for
such coverage in a reasonable and nondiscriminating manner. Within five (5)
Business Days after the Sellers' receipt of a written request of the Purchaser,
the Sellers shall reimburse the Purchaser for all properly documented payments
actually made by Purchaser in connection with Purchaser's obligation to provide
health coverage under this Section 4.1(k)(i) to those persons listed on Schedule
2.18(k) and any other employees of the Sellers who have a COBRA qualifying event
between the date hereof and the Closing Date, (other than those for whom the
qualifying event triggering such continuation coverage is the sale of assets
effectuated by this Agreement), in excess of the premiums actually received by
Purchaser.
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(ii) The Purchaser shall execute the Aetna Contract pursuant
to which the Purchaser shall administer certain medical claims incurred by
certain employees and former employees of the Sellers as set forth in the Aetna
Contract. The Purchaser and the Sellers acknowledge and agree that the Purchaser
shall perform a similar function with respect to dental claims of such employees
of the Sellers, notwithstanding the fact that there is no administrative
services contract to which the Purchaser may become a party
(iii) Within five (5) Business Days after the Sellers' receipt
of a written request of Purchaser, the Sellers shall reimburse the Purchaser for
all properly documented payments actually made by Purchasers to or on behalf of
any person who is or was an employee of the Sellers for medical (including
dental) expenses arising out of events occurring prior to the Closing Date
regardless of when reported, to the extent such payments exceed $800,000. In the
event that the Sellers fail to deliver the amounts required to be delivered by
this Section 4.1(k)(iii) when due, then the Purchaser may, in its sole and
absolute discretion, either (A) set off the amount due from any amount payable
from the Purchaser to the Sellers in connection with workers compensation claims
pursuant to Section 4.1(g), or (B) withdraw the amount due from the funds held
pursuant to the Escrow Agreement; provided, however, that so long as the
Purchaser has not elected to set off or withdraw such amounts from funds held
pursuant to the Escrow Agreement, the Purchaser shall be entitled to seek
payment of such amounts directly from the Sellers; and provided further that if
the Purchaser does withdraw such amounts from the Escrow Agreement, the Sellers
shall be required to replenish the Escrow Amount by depositing an equivalent
amount with the Escrow Agent within five (5) Business Days of a request from the
Purchaser.
1.5 Section 4.18 is hereby replaced in its entirety with the following:
4.18 Sellers' Bank Accounts. Prior to the Closing, the Purchaser will
designate, from among the accounts described in Section (e) of Schedule 2.26,
which accounts the Purchaser will take assignment of, and after the Closing,
Sellers will use commercially reasonable efforts to assist Purchaser in having
such accounts assigned to the Purchaser. During the period between the Closing
Date and the time at which such accounts are assigned to the Purchaser, the
Sellers will wire funds from and write checks on all available funds in such
accounts in accordance with the Purchaser's instructions. With respect to all
other accounts described in Section (e) of Schedule 2.26, on the Closing Date,
the Purchaser shall be entitled to all amounts therein, which amounts will be
credited to the Purchaser in connection with the Final Determination and such
accounts will not be assigned to the Purchaser but shall remain in the name and
under the control of the applicable Seller.
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1.6 A new Section 5.23 is hereby added which reads in its entirety
as follows:
5.23 Joinder to Aetna Contract. The Purchaser, Offray and
Aetna Life Insurance Company shall have entered into a joinder
agreement with respect to the Aetna Contract in substantially
the form attached hereto as Exhibit F.
1.7 A new Section 6.11 is hereby added which reads in its entirety
as follows:
6.11 Joinder to Aetna Contract. The Purchaser, Offray and
Aetna Life Insurance Company shall have entered into a joinder
agreement with respect to the Aetna Contract in substantially
the form attached hereto as Exhibit F.
1.8 Section 9.9 is hereby replaced in its entirety with the
following:
9.9 Governing Law. This Agreement shall be construed in
accordance with and governed by the laws of the State of New
Jersey applicable to agreements made and to be performed
wholly within such jurisdiction; except that as any such
provision relates to the Purchased Assets of Offray Canada,
such provisions shall be governed by the laws of the Province
of Quebec, without giving effect to the choice of law
provisions of such law and without giving effect to the United
Nations Convention on the International Sale of Goods.
1.9 The following definitions are hereby added to Section 10.1:
"Aetna Contract" means that certain administrative services
agreement, Contract Number ASC-367905, between Aetna Life
Insurance Company and Offray.
2. Capitalized terms used herein and not otherwise defined shall have the
meanings given to them in the Original Purchase Agreement.
3. Except as expressly amended herein, all terms and conditions of the Original
Purchase Agreement shall remain in full force and effect.
4. This Amendment shall be construed in accordance with and governed by the laws
of the State of New Jersey applicable to agreements made and to be prepared
wholly within such jurisdiction; except that as any such provision relates to
the Purchased Assets of Offray Canada, such provisions shall be governed by the
laws of the Province of Quebec without giving effect to the conflict of laws
provisions of such law and without giving effect to the United Nations
Convention on the International Sale of Goods.
5. This Amendment may be executed in one or more counterparts, each of which
shall for all purposes be deemed to be an original and all of which shall
constitute the same instrument. It shall not be necessary in making proof of
this Amendment or any counterpart hereof to provide or account for any of the
other counterparts. This Amendment may be executed by facsimile signatures which
shall have the same force and effect as original signatures.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment to be executed on its behalf as of the date first above written.
C.M. OFFRAY & SON, INC.
By: /s/ Daniel P. Barron
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Name: Daniel P. Barron
Title: Vice President, Finance
LION RIBBON COMPANY, INC.
By: /s/Daniel P. Barron
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Name: Daniel P. Barron
Title: Vice President, Finance
CVO CORPORATION (DELAWARE)
By: /s/Daniel P. Barron
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Name: Daniel P. Barron
Title: Vice President, Finance
C.M. OFFRAY & SON LIMITED
By: /s/Daniel P. Barron
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Name: Daniel P. Barron
Title: Vice President, Finance
C.M. OFFRAY EUROPE
By: /s/Daniel P. Barron
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Name: Daniel P. Barron
Title: Vice President, Finance
OFFRAY RIBBON CANADA, INC.
By: /s/ Daniel P. Barron
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Name: Daniel P. Barron
Title: Vice President, Finance
C.M. OFFRAY & SON (HONG KONG) LIMITED
By: /s/ Daniel P. Barron
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Name: Daniel P. Barron
Title: Vice President, Finance
/s/ Claude V. Offray, Jr.
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CLAUDE V. OFFRAY, JR., Major Stockholder
/s/ Claude V. Offray, III
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CLAUDE V. OFFRAY, III, Stockholder
/s/ Denise A. Offray
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DENISE A. OFFRAY, Stockholder
DAYLIGHT ACQUISITION CORP.
By: /s/ Christopher J. Munyan
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Name: Christopher J. Munyan
Title: President
BERWICK INDUSTRIES LLC
By: /s/ Christopher J. Munyan
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Name: Christopher J. Munyan
Title: President