View:
Item 2. Acquisition or Disposition of Assets.
- -----------------------------------------------
On June 30, 1995, Matson Leasing Company, Inc. ("Matson Leasing"), a
Hawaii corporation and indirect wholly-owned subsidiary of Alexander &
Baldwin, Inc. ("A&B"),and Matson Navigation Company, Inc., a Hawaii corporation
and wholly-owned subsidiary of A&B as well as parent corporation of Matson
Leasing (collectively, the "Sellers"), consummated the sale to XTRA, Inc.
("XTRA"), a Maine corporation, of Matson Leasing's container leasing business,
through the sale of certain assets and liabilities of the Sellers (primarily
of Matson Leasing). The assets sold included Matson Leasing's cash, trade
and other non-intercompany accounts receivable, prepaid expenses, other
current assets, containers (free of liens, except for leases to customers,
cross-border leases and mechanics' liens), office furniture, equipment,
leasehold improvements, systems (net of accumulated depreciation and
amortization), and stock of certain foreign subsidiaries.
XTRA assumed the Sellers' rights and obligations under all existing
contracts relating to Matson Leasing's container leasing business, including
container leases, depot agreements, service agreements, agency agreements,
equipment purchase contracts, office leases, employment and consulting
agreements (related to the ordinary course of business), technology
agreements and other agreements, except loan agreements and commercial paper
placement agreements. XTRA also assumed specified liabilities of the container
leasing business, including certain accounts payable, payroll taxes and fringe
benefits for non-U.S. employees, certain other current liabilities and certain
other long-term liabilities, not including long-term debt and commercial paper.
This disposition was consummated pursuant to an Asset Purchase Agreement
dated as of June 30, 1995. The total selling price for the transaction was
approximately $360 million, which amount was paid in full upon consummation,
subject to a final audit and post-closing adjustments. A copy of the Asset
Purchase Agreement is attached hereto as Exhibit 10.a.(xxiv), and is
incorporated herein by reference. The foregoing descriptions do not purport to
be complete and are qualified in their entirety by reference to such Exhibit.
Item 7. Financial Statements and Exhibits.
- ------ ----------------------------------
7(b). Pro forma financial information.
---- --------------------------------
Filed as a part of this report as Exhibit 10.a.(xxv) is the required pro
forma financial information relative to the disposition of assets described in
Item 2 above.
7(c). Exhibits.
---- ---------
Exhibit 10.a.(xxiv) Asset Purchase Agreement among XTRA, Inc.,
Matson Navigation Company, Inc. and
Matson Leasing Company, Inc., dated
June 30, 1995.
Exhibit 10.a.(xxv) Pro forma financial information relative
to the transaction.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly cause this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
Date: July 13, 1995
ALEXANDER & BALDWIN, INC.
/s/ Glenn R. Rogers
Glenn R. Rogers
Vice President, Chief Financial
Officer and Treasurer
EXHIBIT INDEX
10. Material contracts.
10.a.(xxiv) Asset Purchase Agreement among XTRA, Inc.,
Matson Navigation Company, Inc. and Matson Leasing
Company, Inc., dated June 30, 1995.
10.a.(xxv) Pro forma financial information relative to the
transaction.
Exhibit 10.a.(xxiv)
Execution Draft
Asset Purchase Agreement
among
XTRA, Inc.
and
Matson Navigation Company, Inc., and
Matson Leasing Company, Inc.
dated
June 30, 1995
ASSET PURCHASE AGREEMENT
INDEX
Page
ARTICLE I PURCHASE AND SALE OF ASSETS AND RELATED TRANSACTIONS 1
1.01. Definitions. 1
1.02. Purchase and Sale of Sale Assets; Assumption of Liabilities. 9
1.03. Consideration. 10
1.04. Assignment and Assumptions of Contracts. 10
1.05. Closing 10
1.06. Matson Trademarks and Trade Names 11
1.07. Adjustments to Consideration 12
1.07(a) Preparation of Consolidated Statement of Net Assets. 12
1.07(b) Adjustments Resulting From The Consolidated
Statements of Net Assets. 13
1.08. Accounts Receivable Proceeds 13
1.09. Further Assurances 14
1.10. CAVN and Jeuro Leases and Containers. 14
1.11. Termination of Intercompany Arrangements. 14
ARTICLE II RELATED MATTERS 15
2.01. Confidentiality. 15
2.02. Access to Books and Records. 15
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE SELLERS 16
3.01. Corporate Organization, Etc 16
3.02. Authorization, Etc. 17
3.03. No Violation. 17
3.04. Financial Statements 17
3.05. Interim Operations. 18
3.06. Title to Properties; Encumbrances 19
3.07. Contracts and Leases 20
3.08. Litigation. 20
3.09. Consents and Approvals of Governmental Authorities 20
3.10. Consents 21
3.11. Compliance with Law 21
3.12. Good Title Conveyed 21
3.13. Brokers and Finders 22
3.14. Insider Interests 22
3.15. Insurance 22
3.16. Environmental Matters, Etc. 22
3.17. Employees. 24
3.18. Employee Benefits; ERISA. 24
3.19. Taxes. 24
3.20. Prohibited Foreign Trade Practices Act; Sensitive Payments 25
3.21. Subsidiaries 25
3.22. Condition of Containers. 26
3.23. Purchase Option; Operating Lease Agreements. 26
3.24. Software; Intellectual Property 27
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF ACQUIROR 27
4.01. Corporate Organization 27
4.02. Authorization, Etc. 27
4.03. No Violation. 28
4.04. Consents and Approvals of Governmental Authorities. 28
4.05. Litigation 28
4.06. Consents 28
4.07. Brokers and Finders 28
4.08. Availability of Funds. 28
ARTICLE V COVENANTS OF THE SELLERS 29
5.01. Full Access. 29
5.02. Consents 29
5.03. Supplements to Company Disclosure Schedule 29
5.04. Covenant to Satisfy Conditions 29
5.05. Certificates 30
5.06. HSR Act Filings 30
5.07. Container Acquisitions 30
5.08. Insurance. 30
ARTICLE VI COVENANTS OF ACQUIROR 30
6.01. Supplements to Acquiror Disclosure Schedule. 30
6.02. Covenant to Satisfy Conditions 31
6.03. Certificates 31
6.04. HSR Act Filings 31
6.05. Consents 31
6.06. Other Agreements 31
6.07. Substitute Letters of Credit. 31
6.08. Insurance. 31
6.09. Post Closing Financial Statements. 32
6.10. Performance of Certain Obligations by Acquiror
After Closing Date. 32
ARTICLE VII CONDITIONS TO THE OBLIGATIONS OF THE SELLERS 32
7.01. Representations and Warranties True 32
7.02. Performance. 33
7.03. HSR Act Waiting Periods; No Governmental Proceeding
or Litigation 33
7.04. No Litigation 33
7.05. Certificates 33
7.06. Opinion of Acquiror's Counsel 33
7.07. Consents Obtained. 33
7.08. Other Agreements 33
7.09. Opinion of Morgan, Lewis & Bockius. 33
7.10. Release of Letters of Credit. 33
ARTICLE VIII CONDITIONS TO OBLIGATIONS OF ACQUIROR 34
8.01. Representations and Warranties True 34
8.02. Performance 34
8.03. HSR Act Waiting Periods; No Governmental Proceeding
or Litigation 34
8.04. No Litigation 34
8.05. Opinion of the Sellers' Counsel. 34
8.06. Consents Obtained 35
8.07. Other Agreements 35
8.08. Opinion of Morgan, Lewis & Bockius. 35
8.09. FIRPTA Certificate. 35
ARTICLE IX (INTENTIONALLY OMITTED)
ARTICLE X EMPLOYEES 35
10.01. Offer of Employment. 36
10.02. Sellers' Obligations. 36
10.03. Cooperation. 36
10.04. Non-solicitation. 36
ARTICLE XI SURVIVAL OF REPRESENTATIONS ANDWARRANTIES;
INDEMNIFICATION; ARBITRATION 37
11.01. Survival of Representations and Warranties. 37
11.02. Statements as to Representations 37
11.03. Agreement to Indemnify by the Sellers. 37
11.04. Agreement to Indemnify by Acquiror. 38
11.05. Procedures Relating to Indemnifications. 39
11.06. Losses Net of Insurance, etc. 40
11.07. Tax Matters. 41
11.08. Arbitration. 43
ARTICLE XII TERMINATION AND ABANDONMENT 44
12.01. Methods of Termination. 44
12.02. Procedure upon Termination 44
ARTICLE XIII MISCELLANEOUS PROVISIONS 44
13.01. Amendment and Modification. 44
13.02. Waiver of Compliance. 45
13.03. Expenses; Transfer Taxes. 45
13.04. Notices 45
13.05. Assignment. 47
13.06. Publicity. 47
13.07. Governing Law. 47
13.08. Counterparts. 47
13.09. Headings. 47
13.10. Entire Agreement. 47
13.11. Third Parties. 47
13.12. Bulk Transfers 48
INDEX TO EXHIBITS
Heading Tab
Sale Assets A
Assumed Liabilities B
Assignment and Assumption of Agency Agreements C
Assignment and Assumption of Container Leases D
Assignment and Assumption of Container Purchase Commitments E
Assignment and Assumption of Depot Agreements F
Assignment and Assumption of Employment Agreements G
Assignment and Assumption of Miscellaneous Commitments H
Assignment and Assumption of Property and Office Leases I
(Omitted) J
Branches K-1
Subsidiaries K-2
MNC Subsidiaries K-3
Intellectual Property License and Assignment Agreement L
Non-Competition Agreement M
Operating Lease Assignment and Assumption Agreement N
(Omitted) O
Transition Agreement P
Bill of Sale Q
Consolidated Statement of Net Assets (As of 3/31/95) R
Opinion of Ropes & Gray S
Opinion of Morgan, Lewis & Bockius T
Opinion of Gibson, Dunn & Crutcher U
Software Transfer Agreement V
Office Sublease W
Opinion of James R. Lajoie X
Opinion of Kevin C. O'Rourke Y
ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT dated June 30, 1995 among Matson Leasing Company,
Inc., a Hawaii corporation, Matson Navigation Company, Inc., a Hawaii
corporation, and XTRA, Inc., a Maine corporation.
This Agreement sets forth the terms and conditions upon which Matson
Leasing Company, Inc. and Matson Navigation Company, Inc. will sell certain
assets to XTRA, Inc. and/or other entities designated by XTRA, Inc., and XTRA,
Inc. and/or such other entities designated by XTRA, Inc. will purchase such
assets as hereinafter set forth.
In consideration of the mutual agreements contained herein, intending to
be legally bound hereby, the parties hereto agree as follows:
ARTICLE I
PURCHASE AND SALE OF ASSETS AND RELATED TRANSACTIONS
1.01. Definitions. For purposes of this Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
"Acquiror" means XTRA, Inc., a corporation formed under the laws of the
State of Maine.
"Acquiror Entities" shall mean XTRA International, XTRA Intermodal and
XTRA Lease.
"Affiliate" and "Associate" have the meanings prescribed by Rule 12b-2 of
the regulations promulgated pursuant to the Securities Exchange Act.
"Agency Agreements" means the agency agreements all as set forth on Part
VII of Exhibit A.
"Agreement" means this agreement and all amendments made hereto by written
agreement between the Sellers and the Acquiror, including all Schedules and
Exhibits attached hereto.
"Assignment and Assumption Agreements" means the Assignment and Assumption
of Agency Agreements, the Assignment and Assumption of Container Leases, the
Assignment and Assumption of Container Purchase Commitments, the Assignment and
Assumption of Depot Agreements, the Assignment and Assumption of Employment
Agreements, the Assignment and Assumption of Miscellaneous Commitments, the
Assignment and Assumption of Property and Office Leases, the Software Transfer
Agreement and the Operating Lease Assignment and Assumption.
"Assignment and Assumption of Agency Agreements" means the assignment and
assumption of Agency Agreements substantially in the form attached hereto as
Exhibit C delivered by the Company and Acquiror pursuant to Section
1.05(a)(I)(iii) and 1.05(b)(i) of the Agreement.
"Assignment and Assumption of Container Leases" means the assignment and
assumption of the Container Leases substantially in the form attached hereto as
Exhibit D delivered by the Company, MNC, MNC Subsidiaries, Acquiror and the
Acquiror Entities pursuant to Sections 1.05(a)(I)(iii), 1.05(a)(II)(ii),
1.05(a)(III) and 1.05(b)(i) of this Agreement.
"Assignment and Assumption of Container Purchase Commitments" means the
assignment and assumption of the Container Purchase Commitments substantially
in the form attached hereto as Exhibit E delivered by the Company and the
Acquiror pursuant to Sections 1.05(a)(I)(iii) and 1.05(b)(i) of this Agreement.
"Assignment and Assumption of Depot Agreements" means the assignment and
assumption of Depot Agreements substantially in the form attached hereto as
Exhibit F delivered by the Company and Acquiror pursuant to Section
1.05(a)(I)(iii) and 1.05(b)(i) of the Agreement.
"Assignment and Assumption of Employment Agreements" means the assignment
and assumption of the Employment Agreements substantially in the form attached
hereto as Exhibit G delivered by the Company and Acquiror pursuant to Sections
1.05(a)(I)(iii) and 1.05(b)(i) of the Agreement.
"Assignment and Assumption of Miscellaneous Commitments" means the
assignment and assumption of the Miscellaneous Commitments substantially in the
form attached hereto as Exhibit H delivered by the Company and Acquiror
pursuant to Sections 1.05(a)(I)(iii) and 1.05(b)(i) of the Agreement.
"Assignment and Assumption of Property and Office Leases" means an
assignment and assumption of the property and office leases substantially in
the forms attached hereto as Exhibit I delivered by each of the Company and
Acquiror pursuant to Section 1.05(a)(I)(iii) and 1.05(b)(i) of this Agreement.
"Assumed Liabilities" means the liabilities being assumed by Acquiror
pursuant to this Agreement, all as listed and described on Exhibit B.
"Benefit Arrangement" means any benefit arrangement that is not a Plan,
including (i) each employment or consulting agreement, (ii) each incentive
bonus or deferred bonus arrangement, (iii) each arrangement providing
termination allowance, severance or similar benefits, (iv) each equity
compensation plan, (v) each deferred compensation plan, (vi) each individual
insurance arrangement, and (vii) each compensation policy and practice
maintained by the Company or any ERISA Affiliate covering the employees,
former employees, directors and former directors of the Company or its ERISA
Affiliates, and the beneficiaries of any of them.
"Bill of Sale" means the bills of sale in the form attached hereto as
Exhibit Q-1 and Q-2 and delivered by the Company pursuant to Section
1.05(a)(I)(i).
"Branches" means branches of the Company all as set forth on Exhibit K-1
of the Agreement.
"CAVN" means Compania Anonima Venezolana de Navegacion, a Venezuelan
entity.
"CAVN and Jeuro Operating Leases" means the Operating Leases between the
Company and CAVN and Jeuro, respectively.
"Closing" means the closing referred to in Section 1.05 of this Agreement.
"Closing Date" means the date on which the Closing occurs.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means Matson Leasing Company, Inc., a corporation formed under
the laws of the State of Hawaii.
"Company Disclosure Schedule" means the document delivered by the Sellers
to Acquiror simultaneously with the execution hereof containing the information
required to be included therein pursuant to this Agreement.
"Consolidated Statement of Net Assets" means a consolidated statement of
net assets of the Company and its subsidiaries which shall be prepared on the
basis of generally accepted accounting principles applied on a consistent basis
with the preparation of the Audited Financial Statements (as defined in Section
3.04) except with respect to the specific items for which a methodology has
been established and set forth on Exhibit R. The Consolidated Statement of Net
Assets shall include all of the Sale Assets and Assumed Liabilities for which
amounts are properly reflected on a balance sheet, but shall not include (I)
any accrued payroll or vacation liabilities of the Subsidiaries referred to in
Section 10.02, or (II) any reserves expressly related to any Excluded Asset;
provided that no adjustment to the maintenance and repair reserve shall be made
as a result of the foregoing clause. Attached as Exhibit R is the Consolidated
Statement of Net Assets of the Company and its subsidiaries as of March 31,
1995.
"Containers" means the marine containers listed and described on Part I of
Exhibit A hereto which are owned or leased-in pursuant to the Container Leases
by the Company and those marine containers acquired by the Company on or after
June 28, 1995 through the Closing Date and which are to be acquired by the
Acquiror pursuant to this Agreement.
"Container Leases" means the so-called cross-border leases and related
agreements of the Sellers and the MNC Subsidiaries, all as set forth on Part IV
of Exhibit A.
"Container Operations" means the leasing of containers by the Company and
all Subsidiaries of the Company or their agents.
"Container Purchase Commitments" means the container purchase commitments
of the Company all as set forth on Part II of Exhibit A and those container
purchase commitments entered into by the Company on or after June 28, 1995
through the Closing Date in compliance with Section 3.05 or with the prior
written consent of Acquiror or its authorized representatives .
"Depot Agreements" means the depot agreements all as set forth on Part VII
of Exhibit A and those depot agreements entered into by the Company on or after
June 28, 1995 through the Closing Date in compliance with Section 3.05 or with
the prior written consent of Acquiror or its authorized representatives .
"Employment Agreements" means the agreements all as set forth on Part II
of Exhibit B.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Excluded Assets" means the following assets of the Company and the
Subsidiaries:
(a) Any contracts or agreements (i) between any
Subsidiary, on the one hand, and the Company or MNC, on the other
(including any intercompany receivables of any Subsidiary due from
the Company or MNC), or (ii) between the Company and MNC (including
any intercompany receivables of the Company due from MNC), other
than any Operating Leases between MNC and the Company and any
receivables of the Company due thereunder;
(b) Any deferred Tax assets or deferred Tax benefits and
Group Tax Sharing arrangements, other than in respect of Taxes of
the Subsidiaries and the Branches;
(c) Any trademarks, tradenames or logos used by the
Company or the Subsidiaries in the Container Operations, including
the Names and the Marks;
(d) The CAVN and Jeuro Operating Leases, any accounts
receivable from CAVN and Jeuro under the CAVN and Jeuro Operating
Leases (net of the related allowance for bad debts), any claims
against CAVN or Jeuro or insurance companies for loss of or damage
or repair to Containers leased to CAVN and Jeuro and any claims
against insurance companies for lost revenues under the CAVN and
Jeuro Operating Leases;
(e) Any assets of the Company that are segregated or set
aside in any manner for the purpose of providing benefits under any
Plan or any Benefit Arrangements to United States employees;
(f) The Company's minute books, tax returns and other
corporate documents;
(g) Any insurance policies or receivables of the Company
and any pre-paid premiums relating to such policies; and
(h) Any pre-paid expenses or other assets of the Company
arising in connection with the Agreement and the transactions
contemplated hereby.
"Excluded Liabilities" means all liabilities of the Company other than the
Assumed Liabilities, including but not limited to the following liabilities and
obligations of the Company and the Subsidiaries:
(a) Any liabilities or obligations of the Company or the
Subsidiaries to MNC and any liabilities or obligations of the
Subsidiaries to the Company (including any intercompany payables of
the Company due to MNC, or of the Subsidiaries due to the Company or
MNC), other than any obligations of the Company to MNC under any
Operating Leases between the Company and MNC ;
(b) Any liability of the Company for Taxes or deferred
Taxes;
(c) Any obligation of the Company to indemnify any person
by reason of the fact that such person was a director, officer,
employee or agent of the Company or its Subsidiaries or was serving
at the request of any such entity as a partner, trustee, director,
officer, employee or other agent of another entity;
(d) Any liability resulting from or arising out of, in the
nature of or caused by any breach of contract, breach of warranty,
tort, infringement, violation or noncompliance with law by the
Company;
(e) Any liability of the Company for costs and expenses,
including any severance arrangements, incurred or entered into in
connection with this Agreement and the transactions contemplated
hereby, other than Transfer Taxes payable by Acquiror pursuant to
Section 13.03;
(f) Any liability for indebtedness for money borrowed,
including any accrued interest thereon;
(g) Any liability of the Company under the Plans or any
Benefit Arrangement in respect of employees, other than (i) any
liabilities under the Employment Agreements listed under Part II of
Exhibit B or (ii) any liabilities for fringe or severance benefits
under the laws of any non-United States jurisdiction.
"Foreign Subsidiaries" means the direct and indirect subsidiaries of the
Company all as set forth on Exhibit K-2 of the Agreement.
"HSR Act" means the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended.
"Intellectual Property Rights" shall have the meaning defined in the
Software Transfer Agreement.
"Jeuro" means Jeuro, Inc., a Japanese entity.
"knowledge" when used in any representation or warranty of the Sellers or
Acquiror, means actual knowledge of the officers of the Sellers, or the
Acquiror, as applicable, without any obligation on their part to investigate
the accuracy of the representation.
"License Agreement" means the Intellectual Property License and Assignment
Agreement in the form attached hereto as Exhibit L described in Section 1.06
hereof and delivered by the Sellers and Acquiror pursuant to Sections
1.05(a)(I)(iii), 1.05(a)(II)(ii) and 1.05(b)(i), respectively.
"Miscellaneous Commitments" means the contracts, commitments, agreements
and obligations of the Company other than the Container Leases, the Container
Purchase Commitments, the Operating Leases, the Property and Office Leases, the
Employment Agreements, the Agency Agreements, the Software Agreements and the
Depot Agreements.
"MNC" means Matson Navigation Company, Inc., a corporation formed under
the laws of the State of Hawaii.
"MNC Subsidiaries" means those direct or indirect subsidiaries of MNC
(other than the Company) which are parties to any of the Container Leases all
aslisted and set forth on Exhibit K-3.
"Net Assets" means the assets shown on the Consolidated Statement of Net
Assets less the liabilities shown on the Consolidated Statement of Net Assets.
"Non-Competition Agreement" means the Non-Competition Agreement in the
form attached hereto as Exhibit M delivered by the Sellers, Alexander &
Baldwin, Inc.and Acquiror pursuant to Sections 1.05(a)(I)(iii), 1.05(a)(II)(ii)
and 1.05(b)(i), respectively.
"Office Sublease" means the sublease of certain office space in San
Francisco, California in the form attached hereto as Exhibit W delivered by MNC
and Acquiror pursuant to Section 1.05(a)(II)(ii) and 1.05(b)(i) of this
Agreement.
"Operating Leases" means the per diem, master service and term leases
(including those with container purchase options) to customers related to the
Containers, all as set forth on Part III of Exhibit A and those per diem,
master service and term leases entered into by the Company after June 28, 1995
through the Closing Date in compliance with Sections 3.05 or with the prior
written consent of Acquiror or its authorized representatives.
"Operating Lease Assignment and Assumption" means the assignment and
assumption of the Operating Leases substantially in the form attached hereto as
Exhibit N delivered by the Company and the Acquiror pursuant to Sections
1.05(a)(I)(iii) and 1.05(b)(i) of this Agreement.
"Permitted Liens" means (i) minor imperfections of title, if any, which
are insubstantial in amount, and which do not materially detract from the value
or impair the use of the Sale Assets and which have arisen only in the ordinary
course of business and consistent with past practice, (ii) materialmen's,
mechanics', carriers', workmen's, repairmen's or other similar liens arising in
the ordinary course of business and not yet subject to foreclosure, (iii) any
lien for current Taxes not yet due, (iv) possessory liens on Containers held by
depots at which Containers are located pursuant to Depot Agreements to the
extent not yet choate, (v) any rights of any third parties in the Containers
pursuant to the Container Leases, and (vi) the purchase options listed in
Section 3.23 of the Company Disclosure Schedule.
"PICC" means Pacific International Container Corporation, a corporation
formed under the laws of the State of Hawaii.
"Plan" means any employee benefit plan, as defined in Section 3(3) of
ERISA, sponsored or contributed to by the Company covering its employees or
former employees.
"Property and Office Leases" means the leases and subleases related to
office space and other property, all as set forth on Part VI of Exhibit A and
those leases and subleases related to office space and other property entered
into by the Company on and after June 28, 1995 through the Closing Date in
compliance with Sections 3.05 or with the prior written consent of Acquiror or
its authorized representatives.
"Sale Assets" means the assets being purchased pursuant to this Agreement,
all as listed and described on Exhibit A.
"Securities Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Sellers" means the Company and MNC.
"Sellers Group" is defined in the definition of Tax.
"Software" shall have the meaning defined in the Software Transfer
Agreement.
"Software Agreements" means the software agreements set forth on Part VIII
of Exhibit A.
"Software Transfer Agreement" means the agreement between the Sellers and
Acquiror substantially in the form attached hereto as Exhibit V delivered by
the Sellers and the Acquiror pursuant to Section 1.05(a)(I)(iii), Section
1.05(a)(II)(ii) and Section 1.05(b)(i).
"Subsidiaries" means PICC and the Foreign Subsidiaries.
"Tax" means any federal, state, local, or foreign income, gross receipts,
license, payroll, employment, excise, severance, stamp, occupation, premium,
windfall profits, environmental (including taxes under Code section 59A),
customs duties, capital stock, franchise, profits, withholding, social security
(or similar), unemployment, disability, real property, personal property,
sales, use, transfer, registration, value added, alternative or add-on minimum,
estimated, or other tax of any kind whatsoever or any obligation to contribute
to the payment of Taxes determined on a consolidated, combined or unitary basis
with respect to a group of corporations that includes the Sellers and the
Subsidiaries (the "Sellers Group"), including any interest, penalty, or
addition thereto.
"Tax Return" means any return, declaration, report, claim for refund, or
information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.
"Transfer Taxes" shall have the meaning set forth in Section 13.03.
"Transition Agreement" means the Transition Agreement in the form attached
hereto as Exhibit P.
"XTRA Intermodal" means XTRA Intermodal, Inc., a corporation formed under
the laws of the State of Delaware and a wholly-owned subsidiary of Acquiror.
"XTRA International" means XTRA International Ltd., a corporation formed
under the laws of the State of Delaware and a wholly-owned subsidiary of
Acquiror.
"XTRA Lease" means XTRA Lease, Inc., a corporation formed under the laws
of the State of Delaware and a wholly-owned subsidiary of Acquiror.
Certain terms used principally in Section 1.07 of this Agreement are
defined in that Section. The plural of any defined term shall have a meaning
correlative to such defined term.
1.02. Purchase and Sale of Sale Assets; Assumption of Liabilities.
Subject to the terms and conditions of this Agreement, at the Closing:
(a) The Sellers will sell, transfer, convey, assign and deliver
to Acquiror and/or other entities designated by Acquiror, and Acquiror
and/or such other entities designated by Acquiror shall purchase, acquire
and accept from the Sellers, the Sellers' right, title and interest in and
to all of the Sale Assets (subject to the Permitted Liens). It is the
intent of the parties that Exhibit A shall include all of the Company's
assets used in the Container Operations (other than the Excluded Assets)
as of June 28, 1995, including, among other things, all of the marine
containers owned or leased by the Company as of June 28, 1995. The
Company will prepare and present not later than two business days prior to
the Closing an Exhibit A listing all Containers as of such date and which
separately reflects containers added or deleted since March 31, 1995 (the
"Exhibit A"). To the extent that any of the Company's marine containers
do not appear on Exhibit A hereto but are discovered after the Closing
Date, and to the extent that the sale of such containers is not otherwise
provided for herein, the Company hereby agrees to sell and the Acquiror
agrees to purchase such marine containers at a price (the "Repurchase
Price") equal to the original purchase price of any such containers less
depreciation to (i) the Closing Date, if Acquiror had use or possession of
such container as of the Closing, or (ii) the date of purchase of such
container by Acquiror, if Acquiror did not have use or possession of such
container as of the Closing.
(b) The Acquiror shall assume and become responsible for all of
the Assumed Liabilities. The parties acknowledge that Acquiror is not
assuming any liabilities except the Assumed Liabilities specifically
assumed hereunder or assumed pursuant to agreements executed in connection
herewith.
EXCEPT FOR SPECIFIC REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS
AGREEMENT, THE CONTAINERS, THE COMPUTER HARDWARE AND SOFTWARE AND INTELLECTUAL
PROPERTY RIGHTS OF THE COMPANY AND MNC INCLUDED IN THE SALE ASSETS ARE BEING
SOLD ON AN "AS IS, WHERE IS" BASIS AND THE SELLERS MAKE NO WARRANTIES, EXPRESS
OR IMPLIED, OF MERCHANTABILITY, FITNESS OR OTHERWISE WITH RESPECT TO THE
CONTAINERS WHICH EXTEND BEYOND THE AFORESAID SPECIFIC REPRESENTATIONS AND
WARRANTIES.
1.03. Consideration. Subject to the terms and conditions of this
Agreement, in reliance on the representations, warranties and agreements of the
Sellers contained herein, and in consideration of the sale, assignment,
transfer and delivery of the Sale Assets referred to in Section 1.02
hereof:
1.03(a). Acquiror will deliver, or cause to be delivered, to the Company
at the Closing (A) $350,000,000, subject to adjustment in accordance with the
provisions of Section 1.07 hereof, (B) the Initial Transfer Tax Payment, and
(C) $7,471,000 (the "Purchase Price Adjustment Deposit") (which amount shall be
considered an advance deposit by Acquiror in respect of the purchase price
adjustment provided for in Section 1.07), which amounts will be paid by wire
transfer in immediately available funds to a bank account designated by the
Company.
1.03(b). The consideration referred to in Section 1.03(a)(A) plus the
Assumed Liabilities (to the extent taken into account for federal income tax
purposes) shall be allocated among the Sale Assets set forth on Exhibit A. In
the event of an adjustment to the consideration as a result of the application
of Section 1.07 hereof, the parties shall, within 30 days following the
resolution of such adjustment, endeavor to adjust the allocation of
consideration in Exhibit A to reflect the revised consideration. The parties
agree to prepare all Tax Returns and reports consistently with all allocations
upon which the parties agree, and not to take an inconsistent Tax position
without the consent of the other party. None of the consideration referred to
in Section 1.03(a)(A) shall be allocated to the license referred to in Section
1.06 of this Agreement.
1.04. Assignment and Assumptions of Contracts. In connection with the
purchase and sale of the Sale Assets as described in Section 1.02, the Company
agrees to assign to Acquiror, and Acquiror agrees to assume and perform the
Container Leases, the Container Purchase Commitments, the Operating Leases,
the Property and Office Leases, the Agency Agreements, the Depot Agreements,
the Employment Agreements, the Software Agreements (to which the Company is a
party) and the Miscellaneous Commitments. In connection with the sale of the
Sale Assets described in Section 1.02, MNC agrees to assign to Acquiror, and
with respect to the Container Leases, cause the MNC Subsidiaries to assign to
Acquiror, and Acquiror agrees to assume and perform, the Container Leases and
the Software Agreements (to which MNC is a party).
1.05. Closing 1.05. Closing. Subject to the satisfaction or waiver of
the conditions to closing set forth in Articles VII and VIII, the Closing of
the transactions contemplated by this Agreement will take place at the offices
of Gibson, Dunn & Crutcher, One Montgomery Street, San Francisco, California on
June 30, 1995, at 7:00 A.M., local time, or at such other time and place as may
be agreed upon by the parties hereto.
1.05(a). At the Closing, (I) the Company will deliver to Acquiror (i) a
duly executed Bill of Sale; (ii) (intentionally omitted); (iii) a duly executed
counterpart of each of the Assignment and Assumption Agreements, the License
Agreement, the Non-Competition Agreement and the Transition Agreement; (iv)
(intentionally omitted); (v) an assignment of all guarantees, manufacturers'
warranties, uncollected warranty claims and letters of credit, if any, relating
to the Sale Assets (other than letters of credit entered into by the Company in
connection with Container Purchase Commitments that are not assumed by the
Acquiror in connection with the Closing); (vi) executed copies of the consents
referred to in Section 8.06 hereof that have been obtained; (vii) the opinions
of counsel referred to in Section 8.05 hereof; (viii) all such other deeds,
documents, certificates, assignments, agreements and other instruments as, in
the reasonable opinion of Acquiror's counsel, are necessary to vest in Acquiror
good and marketable title to the Sale Assets; (ix) duly executed stock
assignments with respect to all of the shares of capital stock of the
Subsidiaries owned by the Company; and (x) all other previously undelivered
documents required to be delivered by the Sellers to Acquiror at or prior to
the Closing in connection with the transactions contemplated by this Agreement,
(II) MNC will deliver to Acquiror (i) duly executed stock assignments with
respect to all of the shares of capital stock of the Foreign Subsidiaries owned
by MNC; and (ii) a duly executed counterpart of each of the Software Transfer
Agreement with respect to the Software Agreements to which MNC is a party, the
Assignment and Assumption of Container Leases, the License Agreement, the
Non-Competition Agreement and the Office Sublease; and (III) MNC will cause the
MNC Subsidiaries to deliver to Acquiror duly executed counterparts of the
Assignment and Assumption of Container Leases.
1.05(b). At the Closing, there will be delivered to the Sellers by
Acquiror (i) a duly executed counterpart of each of the Assignment and
Assumption Agreements, the License Agreement, the Non-Competition Agreement,
the Transition Agreement and the Office Sublease; (ii) the consideration
referred to in Section 1.03(a)(A), the Initial Transfer Tax Payment referred to
in Section 1.03(a)(B) hereof and the Purchase Price Adjustment Deposit; (iii)
executed copies of the consents referred to in Section 7.07 hereof; (iv) the
opinions of counsel referred to in Section 7.06 hereof; and (v) all other
previously undelivered documents required to be delivered by Acquiror to the
Sellers at or prior to the Closing in connection with the transactions
contemplated by this Agreement.
1.06. Matson Trademarks and Trade Names. The Sellers shall grant to
Acquiror for a maximum period of fifteen years from the date of the Closing,
on a nonexclusive basis without charge, a license to use the name "Matson"
and any derivation thereof or logo,trademark or tradename owned by the Sellers
(the "Names" and "Marks") on the Containers included in the Sale Assets or on
any containers that are acquired by Acquiror following the Closing pursuant to
the Container Purchase Commitments or acquired pursuant to Section 5.07 of the
Company Disclosure Schedule, to the extent the Names and Marks appear on such
Containers as of the date of the Closing or the date of purchase by Acquiror
(with respect to Containers acquired following the Closing pursuant to
Container Purchase Commitments or acquired pursuant to Section 5.07 of the
Company Disclosure Schedule), as applicable, but only for use so long as the
Names or Marks remain on such Containers. Such license shall be substantially
in the form attached hereto as Exhibit L. The Sellers shall irrevocably assign
to Acquiror the prefix "MLCU". Sellers agree that they will not assign or
grant during the term of the Non-Competition Agreement the right to use the
Names and Marks to a purchaser or licensee for use in connection with a
container leasing business, except to the extent the Company is permitted to
engage in the Container leasing business pursuant to the Non-Competition
Agreement. In the event Acquiror sells any of the Containers to a party other
than an Affiliate, it shall remove, at its own expense, the Names and Marks
from such Containers. From and after the Closing, the Acquiror shall cause each
of the Foreign Subsidiaries to cease the use of the Names and Marks in
connection with their respective businesses, and, Acquiror shall use its best
efforts to cause, within 30 days following the Closing, each of the Foreign
Subsidiaries to change its corporate name to a name that does not include the
Names or Marks. To the extent that there exists any inconsistency between the
provisions of this Section 1.06 and the provisions of the License Agreement,
the provisions of the License Agreement shall govern. Acquiror acknowledges
that except as contemplated by the License Agreement, any license with respect
to the Names and Marks between the Sellers, on the one hand, and any
Subsidiary, on the other hand, shall terminate as of the Closing.
1.07. Adjustments to Consideration.
1.07(a) Preparation of Consolidated Statement of Net Assets.
(i) Within 90 days after the Closing Date, Acquiror will prepare and
deliver to the Sellers a Consolidated Statement of Net Assets for the Company
and its subsidiaries as of the close of business on the Closing Date, which
shall be audited by Arthur Andersen LLP, the independent public accountants of
Acquiror.
(ii) If the Company has no objections to the Consolidated Statement
of Net Assets prepared and delivered by the Acquiror pursuant to Section
1.07(a)(i), it shall so notify Acquiror, and the Consolidated Statement of Net
Assets shall become final on the date the Company provides such notice. If the
Company has any objections to the Consolidated Statement of Net Assets
delivered by Acquiror, it will deliver a detailed statement describing its
objections to the calculation of any item on the Consolidated Statement of Net
Assets to Acquiror within 30 days after receiving such Consolidated Statement
of Net Assets. The Company, and its independent certified public accountants,
Deloitte & Touche LLP, shall, during the period between the delivery by
Acquiror of the Consolidated Statement of Net Assets and the final resolution
of any dispute relating thereto, be permitted to have access to, examine and
make copies of all books and records (including but not limited to
correspondence, memoranda, books of account and the like) in the possession of
Acquiror relating to the Sale Assets and, upon execution of the standard form
indemnity letter of Arthur Andersen LLP, be permitted to review the working
papers of Arthur Andersen LLP relating to such Consolidated Statement of Net
Assets and shall have such access to the Acquiror's and Arthur Andersen LLP's
personnel as may be reasonably necessary to permit Deloitte & Touche LLP to
review in detail the manner in which such Consolidated Statement of Net Assets
was prepared. Acquiror and Arthur Andersen LLP shall cooperate with the
Company and Deloitte & Touche LLP in facilitating such review. If any matter
cannot be resolved by the parties within 15 days following delivery of the
Company's notice of objection, KPMG Peat Marwick LLP will be retained to
resolve all remaining objections. Any determination shall be made by KPMG Peat
Marwick LLP on the basis of such procedures as it, in its sole judgment, deems
appropriate and expeditious, taking into account the nature of the issues, the
amount in dispute and the positions asserted by the parties. KPMG Peat Marwick
LLP shall not be required to follow any particular rules or procedures (except
as provided in this Agreement), it being the intention of the parties to create
a flexible, practical and expeditious method for resolving any disagreement
hereunder. The parties may submit to such firm any fact or materials which
they deem relevant to the determination. The determination of KPMG Peat
Marwick LLP will be set forth in writing and will be conclusive, nonappealable
and binding upon the parties hereto for all purposes.
(iii) The parties shall pay the fees and expenses of their
respective internal and independent accountants and personnel incurred pursuant
to this Section 1.07(a). In the event the parties submit any unresolved
objections to KPMG Peat Marwick LLP for resolution as provided in Section
1.07(a)(ii) above, Acquiror on the one hand and the Company on the other hand
shall each bear equal responsibility for the fees and expenses of KPMG Peat
Marwick LLP.
1.07(b) Adjustments Resulting From The Consolidated Statements of Net
Assets. The consideration described in Section 1.03(a)(A) will be adjusted as
follows:
(i) if the Net Assets of the Company and its Subsidiaries exceed
$317,671,000, Acquiror will pay to Sellers an amount equal to such excess (the
"Additional Purchase Price Amount") less an amount equal to the Purchase Price
Adjustment Deposit, together with interest on the amount of such payment (but
not on the Purchase Price Adjustment Deposit) from the Closing Date until the
date of such payment at a floating rate of interest equal to the prime rate
from time to time in effect as announced by Bank of America, N.A., by wire
transfer or delivery of other immediately available funds within five business
days after the date on which the Net Assets of the Company and its subsidiaries
as reflected on the Consolidated Statement of Net Assets finally are determined
pursuant to Section 1.07(a) above.
(ii) if (a) the Net Assets of the Company and its Subsidiaries are
less than $317,671,000, the Sellers will pay to Acquiror an amount equal to
such deficiency plus an amount equal to the Purchase Price Adjustment Deposit,
or (b) the Additional Purchase Price Amount is less than the Purchase Price
Adjustment Deposit, the Sellers will pay to Acquiror an amount equal to such
deficiency, in each case together with interest on the amount of such payment
from the Closing Date until the date of such payment at a floating rate of
interest equal to the prime rate from time to time in effect as announced by
Bank of America, N.A., by wire transfer or delivery of other immediately
available funds within five business days after the date on which the Net
Assets of the Company and its subsidiaries as reflected on the Consolidated
Statement of Net Assets finally are determined pursuant to Section 1.07(a)
above.
1.08. Accounts Receivable Proceeds. The Sellers hereby agree to remit,
or assign any claims they may have with respect to, and to endorse to Acquiror
any payment they receive after the Closing in respect of any accounts
receivable included in the Sale Assets.
1.09. Further Assurances. Subject to the provisions of Section 8.06,
after the Closing, each party hereto shall from time to time, at the request of
the other party and without further cost or expense to the other party, execute
and deliver such other necessary instruments of conveyance and transfer and
take such other necessary actions as the other party may reasonably request,
in order to more effectively consummate the transactions contemplated hereby
and to vest in the other party good and marketable title to the assets being
transferred hereunder (including, without limitation, assistance in the
collection or possession of any of such assets being transferred hereunder);
provided, however, that nothing in this Section 1.09 shall require either party
to expend funds, to commence litigation, or to grant or offer any accommodation
(financial or otherwise) to any third party.
1.10. CAVN and Jeuro Leases and Containers. (a) Acquiror agrees that
from and after the Closing, it will cooperate fully with Sellers and will take
such actions as Sellers may request in connection with (1) the collection of
Sellers' monetary claims against CAVN and Jeuro for rents, costs of collection
and all other amounts owing to Sellers on account of Operating Leases and the
recovery of containers subject thereto (the "CAVN and Jeuro Containers"); and
(2) the preparation and collection of Sellers' claims under insurance policies
as the result of losses incurred in connection with the foregoing. Sellers'
agree to reimburse Acquiror, within 30 days of invoice therefor from Acquiror,
for all out-of-pocket costs and expenses incurred by them at the request of the
Sellers in connection with the foregoing. Acquiror shall promptly pay over to
the Sellers any and all amounts that it may receive in respect of the CAVN and
Jeuro Operating Leases.
(b) The Sellers agree to reimburse Acquiror, within 30 days of invoice
therefor from Acquiror, for all out-of-pocket costs and expenses incurred by
Acquiror in connection with the recovery of the CAVN and Jeuro Containers,
including, without limitation, all recovery costs, repatriation costs and
repair costs with respect thereto, provided, however, that Acquiror shall have
obtained Sellers' written approval prior to the incurrence of such costs and
expenses and, provided, further, that should Sellers' approval of such costs
and expenses be unreasonably withheld or delayed, Sellers shall repurchase,
within 30 days of invoice therefor from Acquiror, such CAVN and Jeuro Container
at the net book value of such CAVN and Jeuro Container as of the Closing.
(c) Acquiror will deliver to the Company a bill of sale for any CAVN and
Jeuro Container or any other Container for which no value is reflected on the
Consolidated Statement of Net Assets as finally determined. If Sellers
eventually recover any such Container, Sellers will sell and Acquiror will
repurchase such Container at the Repurchase Price.
1.11. Termination of Intercompany Arrangements. Concurrently with the
Closing, the Sellers will cause to be terminated all existing contracts and
agreements (other than Operating Leases), whether written or oral, between any
Subsidiary, on the one hand, and the Company or MNC, on the other, including,
without limitation, all service agreements and any and all licenses covering
the Names or the Marks. Also concurrently with the Closing, the Sellers will
cause to be terminated the sublease from MNC to the Company of office space
at 333 Market Street in San Francisco, California.
ARTICLE II
RELATED MATTERS
2.01. Confidentiality. Each party hereto will hold and will cause its
consultants and advisors to hold in strict confidence,unless compelled to
disclose by judicial or administrative process or, in the opinion of its
counsel, by other requirements of law, all documents and information concerning
the other party furnished it by such other party or its representatives in
connection with the transactions contemplated by this Agreement or prepared by
it in connection with this Agreement and containing such information (except to
the extent that such information can be shown to have been (i) previously known
by the party to which it was furnished, (ii) in the public domain through no
fault of such party or its directors, officers, employees, agents or advisors,
or (iii) later lawfully acquired from other sources by the party to which it
was furnished), and each party will not release or disclose such information to
any other person, except its auditors, attorneys, financial advisors, bankers
and other consultants and advisors in connection with this Agreement who are
made aware of the provisions of this Section 2.01. If the transactions
contemplated by this Agreement are not consummated, such confidence shall be
maintained except to the extent such information comes into the public domain
through no fault of the party required to hold it in confidence, and such
information shall not be used to the detriment of, or in relation to any
investment in, the other party and all such documents (including copies
thereof) shall be returned to the other party immediately upon the written
request of such other party. Each party shall be deemed to have satisfied its
obligation to hold confidential information concerning or supplied by the other
party if it exercises the same care as it takes to preserve confidentiality for
its own similar information. In the event that either party is requested or
becomes legally compelled (by oral questions,interrogatories, requests for
information or document subpoena, civil investigative demand or similar
process) to disclose any such confidential information, such party will provide
the other party with prompt written notice of such request(s) so that the other
party may seek a protective order or other appropriate remedy and/or waive
compliance with the provisions of this Section 2.01. In the event that such
protective order or other remedy is not obtained,or that such party waives
compliance with the provisions of this Section 2.01, the party that is subject
to such request agrees that it will furnish only that portion of the
confidential information that is legally required and will exercise its best
efforts to obtain reliable assurances that confidential treatment will be
accorded to that portion of the confidential information being disclosed. In
the event the Closing does not occur and this Agreement is terminated in
accordance with Section 12.01, for a period of two years following such
termination, neither party will solicit any employee or officer of the other
party to leave such employment with the other party.
2.02. Access to Books and Records.
(a) The Company agrees that for a period equal to the greater of seven
years or any applicable statute of limitations after the Closing, during normal
business hours, it will permit the Acquiror and its auditors and attorneys,
through their authorized representatives, to have access to and examine and
make copies of all books and records (including but not limited to
correspondence, memoranda, books of account, tax reports and returns and the
like) of the Company relating to the Sale Assets and Container Operations and
relating to events occurring prior to the Closing and to transactions or events
occurring subsequent to the Closing which are related to or arise out of
transactions or events occurring prior to such date.
(b) The Acquiror agrees that for a period equal to the greater of seven
years or any applicable statute of limitations after the Closing, during normal
business hours, it will permit the Company and its auditors and attorneys,
through its authorized representatives, to have access to and examine and make
copies of all books and records (including but not limited to correspondence,
memoranda, books of account, tax reports and returns and the like) of the
Company relating to the Sale Assets and Container Operations and relating to
events occurring prior to the date of the Closing and to transactions or events
occurring subsequent to the Closing which are related to or arise out of
transactions or events occurring prior to such date.
(c) Each party will direct its employees to render any assistance which
the other party may reasonably request in examining or utilizing records
referred to in this Section 2.02. For a period equal to the greater or seven
years or any applicable statute of limitations, each party agrees not to
destroy at any time any files or records which are subject to this Section 2.02
without giving reasonable notice to the other party, and within 30 days of
receipt of such notice, such other party may cause to be delivered to it the
records intended to be destroyed, at such other party's expense.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
Each of the Sellers, jointly and severally, hereby represents, covenants
and warrants to Acquiror as follows:
3.01. Corporate Organization, Etc. Each of the Sellers is a corporation
duly organized, validly existing and in good standing under the laws of its
respective state of incorporation, and has full corporate power and authority,
directly or indirectly, to own the Sale Assets it now owns; and the Company
is duly qualified or licensed to do business as a foreign corporation in good
standing in the jurisdictions listed in Section 3.01 of the Company Disclosure
Schedule, which are all the jurisdictions in which direct or indirect ownership
of the Sale Assets or conduct of the Container Operations requires such
qualification or, if it is not so qualified in any such jurisdiction, it can
become so qualified in such jurisdiction without any material adverse effect
upon the Sale Assets or Container Operations.
3.02. Authorization, Etc. Each of the Sellers has full corporate power
and authority to enter into this Agreement and to carry out the transactions
contemplated hereby. Each of the Company and MNC will have taken all corporate
action (including any necessary vote of its board of directors or stockholders)
required by law, its charter documents, by-laws or otherwise to be taken by it
to authorize the execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby, and this Agreement is a valid and
binding agreement of each of the Sellers enforceable in accordance with its
terms, except that (i) such enforcement may be subject to bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter
in effect relating to creditors' rights and (ii) the remedy of specific
performance and injunctive and other forms of equitable relief may be subject
to equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought. No other corporate action by Sellers is
necessary to consummate the transactions contemplated hereby and any other
substantially contemporaneous transactions involving the sale of assets when
considered in the aggregate. Each of the MNC Subsidiaries has full corporate
power and authority to enter into the Assignment and Assumption of Container
Leases and to carry out the transactions contemplated thereby. Each of the MNC
Subsidiaries has taken all action required by law, its charter documents and
Bylaws or otherwise (including any Board of Director or shareholder action) to
authorize the execution and delivery by such MNC Subsidiaries of the Assignment
and Assumption of Container Leases and the consummation of the transactions
contemplated thereby. The Assignment and Assumption of Container Leases, when
executed and delivered by the MNC Subsidiaries, will be the valid and binding
agreement of the MNC Subsidiaries, enforceable in accordance with its terms
except that (i) such enforcement may be subject to bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights and (ii) the remedy of specific performance and
injunctive and other forms of equitable relief may be subject to equitable
defenses and to the discretion of the court before which any proceeding
therefor may be brought.
3.03. No Violation. Neither the execution and delivery of this Agreement
nor the consummation of the transactions contemplated hereby will violate any
provision of the charter or by-laws of any of the Sellers, any subsidiary of
the Company or any MNC Subsidiary, or, except as specified in Section 3.03 of
the Company Disclosure Schedule, violate, or be in conflict with, or constitute
a default (or an event which, with notice or lapse of time or both, would
constitute a default) under, or result in the termination of, or acceleration
of the maturity of any debt or obligation pursuant to, or result in the
creation or imposition of any security interest, lien or other encumbrance upon
any of the Sale Assets under, any material agreement or commitment to which any
of the Sellers, any subsidiary of the Company or any MNC Subsidiary is a party
or by which any of the Sellers, any subsidiary of the Company or any MNC
Subsidiary is bound, or to which any of the Sale Assets is subject, or violate
in any material respect any statute or law or violate any judgment, decree,
order, regulation or rule of any court or governmental authority.
3.04. Financial Statements. The Company has delivered to Acquiror (a)
the audited consolidated balance sheets of the Company and its subsidiaries as
of December 31, 1994 and 1993, and the related consolidated statements of
income, stockholder's equity, and consolidated statements of cash flows for the
two years ended December 31, 1994, certified in each case by Deloitte & Touche
LLP, independent certified accountants, (the "Audited Financial Statements")
and (b) the unaudited consolidated balance sheet of the Company and its
subsidiaries at March 31, 1995, and the related unaudited consolidated
statements of income and cash flows for the three-month period then ended. The
financial information referred to in clause (a) and clause (b) of this Section
3.04 are collectively referred to in this Agreement as the "Financial
Statements". The Financial Statements (including the notes thereto) have been
prepared in accordance with generally accepted accounting principles applied on
a consistent basis through-out the periods covered thereby, and present fairly
the financial condition of the Company and its subsidiaries as of such dates
and the results of operations of the Company and its subsidiaries for the
periods specified therein; provided, however, that the Financial Statements for
the three-month period ended March 31, 1995 are subject to normal year-end
adjustments (which will not be material individually or in the aggregate) and
lack footnotes and other presentation items.
3.05. Interim Operations. Except as reflected on the Financial Statement
for the period ended March 31, 1995, since December 31, 1994, the Container
Operations have been conducted only in the ordinary and usual course of
business consistent with past practice and there has not been any material
adverse change in the financial condition of the Container Operations or the
financial condition or results of operations or business of the Company, other
than adverse changes, if any, that resulted solely from the announcement of the
transactions contemplated by this Agreement. Since March 31, 1995, the Sale
Assets have not been materially affected in any way as a result of flood, fire,
explosion or other casualty (whether or not covered by insurance) or by any
customer or supplier default. Except as set forth in Section 3.05 of the
Company Disclosure Schedule, the Sellers are not aware of any circumstances
that, prior to the Closing, have resulted, or would reasonably be expected
to result in, a material adverse change in the Container Operations.
Without limiting the generality of the foregoing, except as set forth on
Section 3.05 of the Company Disclosure Schedule, disclosed pursuant to
Section 3.17, or as set forth below, since March 31, 1995:
(i) none of the Company and its subsidiaries has sold, leased,
transferred, or assigned any of its assets, tangible or intangible, other than
in the ordinary course of business;
(ii) none of the Company and its subsidiaries has entered into any
agreement, contract, lease, or license (or series of related agreements,
contracts, leases, and licenses) either involving more than $500,000 or outside
the ordinary course of business;
(iii) no party (including any of the Company and its subsidiaries)
has accelerated, terminated, modified, or canceled any agreement, contract,
lease, or license (or series of related agreements, contracts, leases, and
licenses) involving more than $500,000 to which any of the Company and its
subsidiaries is a party or by which any of them is bound, except for
terminations of contracts in accordance with their terms or as contemplated by
this Agreement and modifications of agreements in the ordinary course of
business, none of which (individually or in the aggregate) is materially
adverse to the Company or the Container Operations;
(iv) none of the Company and its subsidiaries has delayed or
postponed the payment of accounts payable and other liabilities, in either case
totaling in excess of $500,000 outside the ordinary course of business;
(v) none of the Company and its subsidiaries has canceled,
compromised, waived, or released any right or claim (or series of related
rights and claims) other than in the ordinary course of business consistent
with past practices;
(vi) none of the Company and its subsidiaries has experienced any
damage, destruction or loss (whether or not covered by insurance) to its
property other than damage, destruction or loss incurred the ordinary course of
business;
(vii) none of the Company and its subsidiaries has entered into
any employment contract or collective bargaining agreement, written or oral, or
modified the terms of any such existing contract or agreement, except for
employment arrangements entered into in the ordinary course of business that
are terminable at will by the Company without penalty;
(viii) none of the Company and its subsidiaries has granted any
increase in the base compensation of any of its officers or employees, or
adopted, amended, modified or terminated any bonus, profit-sharing, incentive,
severance, or other plan, contract, or commitment for the benefit of any of its
officers or employees, or any other change in employment terms for any of its
officers and employees;
(ix) Since May 31, 1995, none of the Company and its Subsidiaries has
granted any options to purchase Containers; and
(x) none of the Company and its subsidiaries has committed to any of
the foregoing.
3.06. Title to Properties; Encumbrances. MNC has or will have as of the
Closing Date, good, valid and marketable title to the capital stock of the
Foreign Subsidiaries shown as owned by MNC on Exhibit A. The Company and/or
its Subsidiaries and/or the MNC Subsidiaries, have, or will have as of the
Closing Date, good, valid and marketable title to, or a valid leasehold
interest in, all the Sale Assets and except as set forth in Section 3.06 of the
Company Disclosure Schedule, all Sale Assets are free and clear of all title
defects, liens, claims, charges, security interests, restrictions on transfer,
or any other encumbrances of any nature whatsoever including, without
limitation, leases, chattel mortgages, conditional sales contracts, collateral
security arrangements and other title or interest retention arrangements,
except for Permitted Liens. Neither the Company nor any Subsidiary thereof
owns, or has ever owned, any real property. Each of the Containers has been
validly issued all cargo container prototype test certificates and cargo
container production certificates. The representations and warranties in this
Section 3.06 shall not be deemed to cover any matters relating to Software,
Software Agreements or Intellectual Property Rights, which are the subject of
Section 3.24.
3.07. Contracts and Leases. Section 3.07 of the Company Disclosure
Schedule contains an accurate and complete listing of all contracts, leases,
agreements or understandings, whether written or oral, providing for payments
or involving the provision of consideration in excess of $100,000
(collectively, the "Commitments") to which the Company, or any Subsidiary of
the Company, is a party which relate to or affect the Sale Assets or by which
any of the
Sale Assets or any purchaser thereof may be bound or which are included in
the Assumed Liabilities. Except as set forth in Section 3.07 of the Company
Disclosure Schedule, each Commitment is valid, binding and enforceable in
accordance with its terms in all material respects, except that (A) such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium, equity of redemption or other similar laws now or hereafter in
effect relating to creditors' rights generally, and (B) general principles of
equity, regardless of whether applied in proceedings in equity or at law; and
that each Commitment is in full force and effect; there are no existing
material defaults by the Company, any Subsidiary of the Company or any MNC
Subsidiary, thereunder; and no event of default has occurred which (whether
with or without notice, lapse of time or the happening or occurrence of any
other event) would constitute a material default by the Company, or any
Subsidiary of the Company or any MNC Subsidiary, thereunder. Prior to the
Closing, Sellers will have delivered to Acquiror true and complete original or
copies of, or true and complete descriptions of, all Commitments. Except as
set forth in Section 3.07 of the Company Disclosure Schedule, no event has
occurred under any tax indemnity agreement included in the Sale Assets and/or
Assumed Liabilities to which the Company or any MNC Subsidiary is a party
relating to the Container Operations (including the Container Leases) which
would cause the Company, any Subsidiary of the Company or any MNC Subsidiary to
incur liability under any such agreement. The representations and warranties
in this Section 3.07 shall not be deemed to cover any matters relating to
Software, Software Agreements or Intellectual Property Rights, which are the
subject of Section 3.24.
3.08. Litigation. Except as set forth in Section 3.08 of the Company
Disclosure Schedule, there is no material action, suit, inquiry, proceeding or
investigation by or before any court or governmental or other regulatory or
administrative agency or commission pending or, to the knowledge of the
Sellers, threatened against any of the Sellers, any Subsidiary of the Company
or any MNC Subsidiary, which relates to the Sale Assets or Container
Operations, or which questions or challenges the validity of this Agreement or
any action taken or to be taken by any of the Sellers or any MNC Subsidiary
pursuant to this Agreement or in connection with the transactions contemplated
hereby. None of the Sellers, nor any Subsidiary of the Company nor any MNC
Subsidiary, is subject to any judgment, order or decree entered in any lawsuit
or proceeding which may have a material adverse effect on the Sale Assets or
the Container Operations.
3.09. Consents and Approvals of Governmental Authorities. Except for
requirements of the HSR Act and any consents, approvals or authorizations
required to be obtained by the Acquiror solely as a result of the Acquiror's
participation in this transaction, or as set forth in Section 3.09 of the
Company Disclosure Schedule, no consent,approval or authorization of any United
States, or to the knowledge of the Sellers, foreign, governmental or regulatory
authority is required in connection with the execution, delivery and
performance of this Agreement by the Sellers or the consummation of the
transactions by them contemplated hereby. Sellers have made all filings which
are required under the HSR Act.
3.10. Consents. Except as set forth in Section 3.10 of the Company
Disclosure Schedule, no consent of any person which has not been obtained
(other than any consents to the assignment of Commitments which are not
Designated Commitments) is necessary to the consummation of the transactions by
the Sellers and the MNC Subsidiaries contemplated hereby, including, without
limitation, consents from parties to loans, contracts, leases or other
agreements. The representations and warranties in this Section 3.10 shall not
be deemed to cover any matters relating to Software, Software Agreements or
Intellectual Property Rights, which are the subject of Section 3.24.
3.11. Compliance with Law. Except as set forth in Section 3.11 of the
Company Disclosure Schedule, the Container Operations have been conducted in
all material respects in accordance with all applicable material laws,
regulations and other requirements of all United States (or to the knowledge of
the Sellers, foreign) governmental authorities, and of all states, munici-
palities and other political subdivisions and agencies thereof, having
jurisdiction over any of the Sellers and any Subsidiary of the Company, or Sale
Assets, including, without limitation, all such laws, regulations and require-
ments relating to antitrust, consumer protection,currency exchange, equal
opportunity, health, occupational safety, pension, securities and trading-with-
the-enemy matters, except, in each case, such incidents of non-compliance that
individually or in the aggregate, would not have a material adverse effect on
the Container Operations or would give rise to any liability on the part of the
Acquiror. None of the Company, nor any Subsidiary of the Company, has received
any notification of any asserted present or past failure by the Company, or any
Subsidiary of the Company, to comply with such laws, rules or regulations,
except, in each case, such incidents of non-compliance that individually or in
the aggregate, would not have a material adverse effect on the Container
Operations or would give rise to any liability on the part of Acquiror.
Without limiting the foregoing, to the knowledge of the Sellers, the Containers
have been manufactured, maintained, repaired and operated and are marked in
accordance with prevailing industry standards in all material respects. The
representations and warranties contained in this Section 3.11 shall not be
deemed to cover any matters relating to Environmental Laws or Taxes, which are
the subject of Sections 3.16 and 3.19, respectively.
3.12. Good Title Conveyed. The Company and MNC have complete and
unrestricted power and the unqualified right to sell, assign, transfer and
deliver to Acquiror, and upon consummation of the transactions contemplated by
this Agreement, Acquiror will acquire, good, valid and marketable title to, or
valid leasehold interests in, the Sale Assets, free and clear of all mortgages,
pledges, liens, security interests, encumbrances or charges of any kind, except
for Permitted Liens and those listed in Section 3.06 of the Company Disclosure
Schedule or as contemplated by Section 3.06 and except that all of Sellers'
representations to the Acquiror in this Agreement regarding title to the
capital stock of the Foreign Subsidiaries and the legal requirements of any
non-United States jurisdiction applicable to the assignment to the Acquiror of
the capital stock of the Foreign Subsidiaries and/or the effect of
non-compliance with such laws, is to the knowledge of the Sellers. The Bill of
Sale and the deeds, endorsements, assignments, other agreements and other
instruments to be executed and delivered to Acquiror by the Sellers at the
Closing will be valid and binding obligations of the Sellers enforceable in
accordance with their terms, except that (i) such enforcement may be subject to
bankruptcy, insolvency, reorganization, moratorium or similar laws now or
hereafter in effect relating to creditors' rights (ii) the remedy of specific
performance and injunctive and other forms of equitable relief may be subject
to equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought and (iii) except that all of Sellers'
representations to the Acquiror in this Agreement regarding the validity,
binding nature or enforceability of any such documents of assignment to
Acquiror of the capital stock of the Foreign Subsidiaries, or the legal
requirements of any non-United States jurisdiction applicable to the assignment
to the Acquiror of the capital stock of the Foreign Subsidiaries and/or the
effect of non-compliance with such laws, is to the knowledge of the Sellers.
The representations and warranties in this Section 3.12 shall not be deemed to
cover any matters relating to Software, Software Agreements or Intellectual
Property Rights, which are the subject of Section 3.24.
3.13. Brokers and Finders. Neither the Sellers, nor any of their
subsidiaries, nor any of their officers, directors or employees has employed
any broker or finder or incurred any liability for any brokerage fees,
commissions or finders' fees in connection with the transactions contemplated
by this Agreement which could result in any liability being imposed on
Acquiror.
3.14. Insider Interests. No officer or director of any of the Sellers,
or any of their subsidiaries, has any material interest in any property, real
or personal, tangible or intangible, including without limitation, inventions,
patents, trademarks or trade names, used in or pertaining to the Sale Assets.
3.15. Insurance. Section 3.15 of the Company Disclosure Schedule contains
an accurate and complete description of all forms of insurance owned or held by
the Company with respect to any of the Sale Assets. All such policies are in
full force and effect, all premiums with respect thereto covering all periods
up to and including the Closing Date have been or will be paid, and no notice
of cancellation or termination has been received with respect to any such
policy.
3.16. Environmental Matters, Etc. Except as set forth in Section 3.16 of
the Company Disclosure Schedule, the Company and each of its Subsidiaries, and
any currently or formerly leased real properties of the Company and its
Subsidiaries, is in compliance in all material respects with all United States
federal, state, local or, to the knowledge of the Sellers, foreign law, rules,
regulations or legal requirements relating to (A) releases or threatened
releases of Hazardous Substances; (B) the manufacture, handling, transport,
use, treatment, storage or disposal of Hazardous Substances or materials
containing Hazardous Substances; or (C)pollution or protection of the
environment or the protection of human health or safety ("Environmental Laws"),
and any other applicable United States federal, state, local or, to the
knowledge of the Sellers, foreign law, statute, ordinance, code, order, rule,
regulation, resolution or promulgation, or any order, writ, judgment,
injunction, decree, stipulation, determination or award entered by or with
any governmental authority, or any license, franchise, permit, or similar right
granted under any of the foregoing ("Legal Requirements"), relating to
environmental, natural resource, or health and safety matters, except such as
have not had and will not have a material adverse effect upon the Container
Operations, business, assets or financial condition of the Company and its
subsidiaries considered as a whole, except that the Sellers make no
representation herein with respect to the compliance with Environmental
Laws or Legal Requirements by any past or present lessee of Containers, depot
operator or manufacturer of Containers, including, but not limited to, any
issues of compliance arising in connection with any such person's (a)
manufacture of Containers, (b) storage of Containers, (c) transportation of
substances in Containers and/or (d) cleaning or repair (or failure to clean or
repair) of Containers. Except as set forth in Section 3.16 of the Company
Disclosure Schedule, there is no claim, action, cause of action or suit,
arbitration, proceeding or, to the knowledge of the Sellers, investigation by
or before any governmental authority pending (or to Sellers' knowledge,
threatened) against the Company or any of its Subsidiaries, in respect of (i)
noncompliance with any Environmental Laws or any such Legal Requirements, (ii)
personal injury, wrongful death, other tortious conduct, or the existence of
any nuisance relating to materials, commodities or products held, used, sold,
transferred, manufactured, released or disposed of, or (iii) the presence or
release or threatened release into the environment of any Hazardous Substance
whether or not generated by the Company or any of its subsidiaries or located
at or about or emanating from or to a site included in the premises covered by
the Property and Office Leases or any of the property heretofore leased, except
that the Sellers make no representation herein with respect to the compliance
with Environmental Laws or Legal Requirements by any past or present lessee of
Containers, depot operator or manufacturer of Containers, including, but not
limited to, any issues of compliance arising in connection with any such
person's (a) manufacture of Containers (b) storage of Containers, (c)
transportation of substances in Containers and/or (d) cleaning or repair (or
failure to clean or repair) of Containers. To the knowledge of the Sellers, no
event has occurred or condition exists or operating practice is being employed
in the Container Operations that will give rise to any liability, loss, damage,
claims, awards, assessments, amounts paid in settlement, fines and penalties,
costs and expenses, on the part of the Acquiror either at the present or at any
future time under any Environmental Laws, or otherwise resulting from or
relating to the handling, storage, use, transportation or disposal of any
Hazardous Substance by or on behalf of the Sellers, or any subsidiary of the
Company, or any of their respective predecessors or otherwise in their
respective properties, except that the Sellers make no representation herein
with respect to the compliance with Environmental Laws or Legal Requirements by
any past or present lessee of Containers, depot operator or manufacturer of
Containers, including, but not limited to, any issues of compliance arising in
connection with any such person's (a) manufacture of Containers, (b) storage of
Containers, (c) transportation of substances in Containers and/or (d) cleaning
or repair (or failure to clean or repair) of Containers.
Neither the Container Operations, nor any of the Sale Assets, are subject
to, or as a result of the transactions contemplated by this Agreement, would be
subject to, the requirements of any Environmental Laws which require notice or
disclosure to any governmental agency, cleanup or approval prior to transfer of
such Sale Assets or Container Operations or which would impose liens on such
Assets, except that the Sellers make no representation herein with respect to
the compliance with Environmental Laws or Legal Requirements by any past or
present lessee of Containers, depot operator or manufacturer of Containers,
including, but not limited to, any issues of compliance arising in connection
with any such person's (a) manufacture of Containers (b) storage of Containers,
(c) transportation of substances in Containers and/or (d) cleaning or repair
(or failure to clean or repair) of Containers. Section 3.16 of the Company
Disclosure Schedule lists all environmental audits, inspections, assessments,
investigations or similar reports in the Company or any Subsidiary of the
Company's possession or of which the Company or any Subsidiary is aware
relating to the Container Operations or compliance of the same with applicable
Environmental Laws. For purposes of this Section 3.16, the term "Hazardous
Substance" means any chemical substance, including but not limited to any: (i)
pollutant, contaminant, chemical, raw material, intermediate, product, by-
product, construction debris; (ii) industrial, solid, toxic or hazardous
substances, material or waste, (iii) petroleum or any fraction thereof; (iv)
asbestos or asbestos-containing material; (v) polychlorinated biphenyls; (vi)
chlorofluorocarbons; and, (vii) any other substance, material or waste which is
identified or regulated under any Environmental Law.
3.17. Employees. The Company has provided to Acquiror (by letter dated
the date hereof) an accurate and complete list of all employees employed by the
Company and any Subsidiary of the Company in connection with the Container
Operations ("Employees") as of the date hereof setting forth the rate,
character and amount of any compensation and benefits then payable to each such
Employee, including identification of any changes in such terms since March 31,
1995.
3.18. Employee Benefits; ERISA. No event has occurred that has resulted,
or could reasonably be anticipated to result, in the assertion of any
withdrawal liability or related lien under Title IV of ERISA against any
Subsidiary or Acquiror.
3.19. Taxes. Except as set forth in Section 3.19 of the Company
Disclosure Schedule to the knowledge of Seller:
(a) Within the applicable time periods therefor (including any valid
extensions) each of the Subsidiaries and Branches has timely filed (or there
was filed on its behalf) all Tax Returns that were required to be filed. No
Subsidiary or Branch is delinquent in the payment of any Taxes of such
Subsidiary or Branch (whether or not shown on any Tax Return). None of the
Subsidiaries or Branches currently is the beneficiary of any extension of time
within which to file any Tax Return or pay any Tax.
(b) Each of the Subsidiaries and Branches has withheld and paid to the
appropriate taxing authority all Taxes required to have been withheld and paid
in connection with amounts paid or owing to any employee, independent
contractor, creditor, stockholder, or other third party.
(c) There is no dispute or claim concerning any Tax liability of the
Subsidiaries or Branches either (A) claimed or raised by any taxing authority
in writing or (B) as to which Sellers and any director, officer or employee
responsible for Tax matters of the Sellers has knowledge based upon personal
contact with any agent of such taxing authority, which, if adversely determined,
would have a material adverse effect on the Container Operations. Section 3.19
of the Company Disclosure Schedule lists all Tax Returns of the Subsidiaries or
the Branches that are currently the subject of audit and indicates those
jurisdictions in which the Company, the Subsidiaries and Branches currently
file consolidated, combined or unitary Tax Returns.
(d) None of the Subsidiaries or Branches has waived any statute of
limitations in respect of Taxes nor agreed to any extension of time with
respect to a Tax assessment or deficiency. Other than as listed in Section 3.19
of the Sellers Disclosure Schedule, there are no powers of attorney with
respect to Taxes of the Subsidiaries or Branches currently in force.
(e) There are no tax sharing agreements between any of the Subsidiaries
and the Sellers.
3.20. Prohibited Foreign Trade Practices Act; Sensitive Payments. To the
knowledge of the Sellers, the Company and its Subsidiaries are in compliance
with the Prohibited Foreign Trade Practices Act with the respect to the
Container Operations, and have no "sensitive" receipts or disbursements, which
are defined to mean the following types of transactions: (i) illegal receipts
from or payments to governmental officials or employees; (ii) commercial bribes
or a kickbacks; (iii) amounts disbursed or received with an understanding that
rebates or refunds will be made in contravention of the laws of any nation or
other jurisdiction; (iv) illegal political contributions; or (v) payments of
commitments, regardless of form, made with the knowledge or under circumstances
that would indicate that all or part thereof is to be paid ultimately to or for
the benefit of governmental officials or employees or as an influence payment
or kickback.
3.21. Subsidiaries. Section 3.21 of the Company Disclosure Schedule sets
forth for each Subsidiary of the Company (i) its name and jurisdiction of
incorporation and (ii) the number of issued and outstanding shares of its
capital stock, the name of each holder thereof and the number of shares held by
each such holder. PICC and, to the Sellers' knowledge, each Foreign Subsidiary
listed on the Company Disclosure Schedule is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation. PICC and, to the Sellers' knowledge, each Foreign Subsidiary is
duly authorized to conduct business and is in good standing under the laws of
each jurisdiction where such qualification is required, except where the
failure to be so qualified would not have a material adverse effect on the
Container Operations. PICC and, to the Sellers' knowledge, each Foreign
Subsidiary has full corporate power and authority and all licenses, permits,
and authorizations necessary to carry on the business in which it is engaged
and to own and use the properties owned, leased and used by it, except where
the absence of the license, permit or authorization would not have a material
adverse effect on the Container Operations. Sellers have delivered to Acquiror
correct and complete copies of the charter and by-laws, or other constituent
documents, of each Subsidiary of the Company, as amended to date. All of the
issued and outstanding shares of capital stock of PICC and, to the Sellers'
knowledge, each Foreign Subsidiary have been duly authorized and are validly
issued, fully paid and nonassessable. Except as set forth in Section 3.17 of
the Company Disclosure Schedule, one or both of the Sellers, or a direct
Subsidiary of the Company, holds of record and owns beneficially all of the
outstanding shares of PICC and, to the Sellers' knowledge, each Foreign
Subsidiary, free and clear of any restrictions on transfer, taxes, security
interest, options, warrants, purchase rates, contracts, commitments, equities,
claims, and demands. There are no outstanding or authorized options, warrants,
purchase rights, subscription rights, conversion rights, exchange rights or
other contracts or commitments that would require any of PICC or, to the
Sellers' knowledge, the Foreign Subsidiaries of the Company to sell, transfer,
or otherwise dispose of any capital stock of any of PICC or, to the Sellers'
knowledge, the Foreign Subsidiaries or that could require PICC or, to the
Sellers' knowledge, any Foreign Subsidiary to issue, sell, or otherwise cause
to become outstanding any of its own capital stock (other than this Agreement).
There are no outstanding stock appreciation, phantom stock, profit
participation or similar rights with respect to PICC or, to the Sellers'
knowledge, any Foreign Subsidiary. Except as set forth in Section 3.21 of the
Company Disclosure Schedule, there are no voting trust, proxies or other
agreements or understandings with respect to the voting of any capital stock of
PICC or, to the Sellers' knowledge, any Foreign Subsidiary. The minute books,
the stock certificate books, and the stock record books of PICC and, to the
Sellers' knowledge, the Foreign Subsidiary are correct and complete in all
material respects. Neither PICC nor, to the Sellers' knowledge, any of the
Foreign Subsidiaries is in default under or in violation of any provision of
its charter or bylaws, except where the default or violation would not have a
material adverse effect on the Container Operations. Neither the Company nor
any Subsidiaries of the Company controls directly or indirectly or has any
direct or indirect equity participation in any corporation, partnership, trust
or other business association which is not a Subsidiary, direct or indirect, of
the Company.
3.22. Condition of Containers. Exhibit A correctly and completely sets
forth, with respect to each container included thereon, the name of
manufacturer, the year of acquisition, dimensions, number of units, original
cost and accumulated depreciation. At the Closing Date, each Container will be
in a condition which complies in all material respects with applicable industry
standards sufficient to allow such Container to be used in the Container
Operations, or will be subject to an Operating Lease which requires such
Container to be in a condition substantially equivalent to such standards upon
delivery at termination or expiration of such Operating Lease. All of the
Containers were newly manufactured when originally purchased by the Company.
3.23. Purchase Option; Operating Lease Agreements. Except as set forth
in Section 3.23 of the Company Disclosure Schedule and except for Permitted
Liens, the Sellers are exclusively entitled to possess (a) at the date hereof,
the Containers which are not currently on lease to customers and (b) at the
expiration of the relevant Operating Leases, the Containers currently subject
to Operating Leases. Except as set forth in Section 3.23 of the Company's
Disclosure Schedule, there are no options to purchase any Containers or rights
of renewal with respect to any Operating Lease.
3.24. Software; Intellectual Property. To the Sellers' knowledge, the
Sellers have good, valid and marketable title to the Software. To the Sellers'
knowledge, the Sellers have complete and unrestricted power and the unqualified
right to sell, assign, transfer and deliver to Acquiror, and, to the Sellers'
knowledge, upon consummation of the transaction contemplated by this Agreement,
Acquiror will acquire good, valid and marketable title to the Software and the
Software Agreements, free and clear of all mortgages, pledges, liens, security
interests, encumbrances or charges of any kind, except for Permitted Liens.
The Sellers have established procedures designed to ensure that (i) any
Software developed by or on behalf of the Sellers did not infringe on the
intellectual property rights of third parties, and (ii) the Sellers received
good, valid and marketable title to all Software developed on their behalf,
free and clear of any adverse claims or rights; and, to the Sellers' knowledge,
such procedures have been followed.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF ACQUIROR
Acquiror hereby represents, covenants and warrants to the Sellers as
follows:
4.01. Corporate Organization. Acquiror is a corporation duly organized,
validly existing and in good standing under the laws of the State of Maine.
Each of the Acquiror Entities is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction in which it was
organized.
4.02. Authorization, Etc. Acquiror has full corporate power and
authority to enter into this Agreement and to carry out the transactions
contemplated hereby. The Board of Directors of Acquiror has taken all action
required by law, its Certificate of Incorporation and By-Laws or otherwise to
authorize the execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby, and this Agreement has been duly executed
and delivered and is a valid and binding agreement of Acquiror enforceable in
accordance with its terms except that (i) such enforcement may be subject to
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights and (ii) the remedy of
specific performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court before which
any proceeding therefor may be brought. Each of the Acquiror Entities has full
corporate power and authority to enter into the Assignment and Assumption
Agreement to which it will be a party and to carry out the transactions
contemplated thereby. The Board of Directors of each of the Acquiror Entities
has taken all action required by law, its charter documents and Bylaws or
otherwise to authorize the execution and delivery by such Acquiror Entity of
the Assignment and Assumption Agreement to which it will be a party and the
consummation of the transactions contemplated thereby. The Assignment and
Assumption Agreements, when executed by the Acquiror Entities, will be valid
and binding agreement of the Acquiror Entities party thereto, enforceable in
accordance with their terms except that (i) such enforcement may be subject to
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights and (ii) the remedy of
specific performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court before which
any proceeding therefor may be brought.
4.03. No Violation. Neither the execution and delivery of this Agreement
nor the consummation of the transactions contemplated hereby will violate any
provisions of the Certificate of Incorporation or By-Laws of Acquiror or any of
the Acquiror Entities, or violate, or be in conflict with, or constitute a
default (or an event which, with notice or lapse of time or both, would
constitute a default) under, or result in the termination of, or accelerate the
performance required by, or cause the acceleration of the maturity of any debt
or obligation pursuant to, or result in the creation or imposition of any
security interest, lien or other encumbrance upon any property or assets of
Acquiror or any of the Acquiror Entities under, any material agreement or
commitment to which Acquiror or any of the Acquiror Entities is a party or by
which Acquiror or any of the Acquiror Entities is bound, or to which the
property of Acquiror or any of the Acquiror Entities is subject, or violatein
any material respect any statute or law or any judgment, decree, order,
regulation or rule of any court or governmental authority.
4.04. Consents and Approvals of Governmental Authorities. Except for
requirements of the HSR Act, no consent, approval or authorization of any
governmental or regulatory authority is required in connection with the
execution, delivery and performance of this Agreement by Acquiror or the
consummation of the transactions by it contemplated hereby.
4.05. Litigation. There is no material action, suit, inquiry,
proceeding or investigation by or before any court or governmental or other
regulatory or administrative agency or commission pending or, to the knowledge
of Acquiror, threatened against Acquiror or any subsidiary which questions or
challenges the validity of this Agreement or any action taken or to be taken by
Acquiror or any of the Acquiror Entities pursuant to this Agreement or in
connection with the transactions by Acquiror or any of the Acquiror Entities
contemplated hereby.
4.06. Consents. No consent of any person is necessary to the
consummation of the transactions by Acquiror or any of the Acquiror Entities
contemplated hereby, including, without limitation, consents from parties to
loans, contracts, leases or other agreements and consents from governmental
agencies, whether federal, state or local.
4.07. Brokers and Finders. Neither Acquiror nor any of the Acquiror
Entities nor any of their officers, directors or employees has incurred any
liability for any brokerage fees, commissions or finders' fees in connection
with the transactions contemplated by this Agreement which could result in any
liability being imposed on Sellers.
4.08. Availability of Funds. As of the Closing, Acquiror will have cash
available or existing borrowing facilities which together are sufficient to
enable it to consummate the transactions contemplated by this Agreement.
ARTICLE V
COVENANTS OF THE SELLERS
MNC and/or the Company, as applicable, hereby covenants and agrees with
Acquiror:
5.01. Full Access. The Company shall afford to Acquiror, its counsel,
accountants and other representatives full access prior to the Closing Date to
the depots, offices, properties, books and records of the Sellers in order
that Acquiror may have full opportunity to make such investigations as it shall
desire to make of the affairs of the Company with respect to the Sale Assets
and Container Operations; provided, however, that any such investigation shall
be conducted in such a manner as not to interfere unreasonably with the
operation of the business of the Company.
5.02. Consents. Each Seller will use its best efforts, and will cause
the subsidiaries of the Company to use their best efforts, to obtain, prior to
the Closing, all consents necessary to be obtained by the Sellers, or any
subsidiary of the Company, in connection with the consummation of the
transactions contemplated hereby; provided, however, that such best efforts
shall not include any requirement to expend funds, to commence litigation or to
grant or offer any accommodation (financial or otherwise) to any third party.
The Company covenants that the Commitments designated by an asterisk on
Schedule 3.07 (the "Designated Commitments") will be transferred and assigned
to the Acquiror on the Closing Date and that the Company, or one or more of its
Subsidiaries, as applicable, will have obtained, as of the Closing Date, all
consents necessary to assign to the Acquiror the Designated Commitments without
causing any default, acceleration or termination under any such Designated
Commitment; provided, however, that the Sellers shall have no liability to
Acquiror for breach of this Agreement for failure to obtain any of the
foregoing consents (other than as may be provided in Article XI for any breach
of any of the representations and warranties set forth in Article III), it
being agreed that the procurement of such consents is a condition to closing
only, provided that Sellers have complied with the first sentence of this
Section 5.02. All such consents will be in writing, and executed counterparts
thereof will be delivered to Acquiror at or prior to the Closing.
5.03. Supplements to Company Disclosure Schedule. From time to time
prior to the Closing, the Sellers will notify Acquiror of changes to the
Company Disclosure Schedule of which they become aware with respect to any
matter hereafter discovered or arising which, if existing or occurring at the
date of this Agreement, would have been required to be set forth or described
in the Company Disclosure Schedule. No such disclosure relating to the Company
Disclosure Schedule shall be deemed to cure any breach of any representation of
or warranty made in this Agreement unless Acquiror specifically agrees thereto
in writing.
5.04. Covenant to Satisfy Conditions. Each Seller will use its best
efforts to insure that the conditions set forth in Article VIII hereof are
satisfied, insofar as such matters are within its control, provided, however,
that such best efforts shall not include any requirement to expend funds, to
commence litigation or to grant or offer any accommodation (financial or
otherwise) to any third party.
5.05. Certificates. At the Closing, each Seller will furnish Acquiror
with such certificates of its officers and others to evidencecompliance with
the covenants set forth in this Article V as may be reasonably requested by
Acquiror.
5.06. HSR Act Filings. The Sellers will make all filings required to be
made pursuant to the HSR Act in connection with the transactions contemplated
by the Agreement and will furnish to Acquiror such necessary information and
reasonable assistance as Acquiror may request in connection with its
preparation of necessary filings or submissions under provisions of the HSR
Act. The Sellers will supply Acquiror copies of all correspondence, filings or
communications (or memoranda setting forth the substance thereof) between any
of the Sellers or their representatives, on the one hand, and the Federal Trade
Commission, the Antitrust Division of the U.S. Department of Justice or any
other governmental agency or authority or members of their respective staffs on
the other hand, with respect to this Agreement or the transactions contemplated
hereby, other than confidential or proprietary information therein.
5.07. Container Acquisitions. Between the date hereof and the Closing,
the Company shall be entitled but not required, to expend, subject to the
approval of the Company's Board of Directors, up to a maximum amount of $21.6
million in accordance with the Company's container purchase plans as set forth
in Section 5.07 of the Company Disclosure Schedule.
5.08. Insurance. Upon the payment by Acquiror of any fee required by any
insurance carrier, Acquiror shall be named as an additional insured party on
all insurance policies regarding the Sale Assets and Container Operations, but
only with respect to liabilities to third parties arising prior to the Closing.
The Sellers shall notify the Acquiror of any fees required by any insurance
carrier pursuant to the preceding sentence.
ARTICLE VI
COVENANTS OF ACQUIROR
Acquiror hereby covenants and agrees with the Sellers:
6.01. Supplements to Acquiror Disclosure Schedule. From time to time
prior to the Closing, Acquiror will notify the Company of any changes to the
Acquiror Disclosure Schedule known to Acquiror with respect to any matter
hereafter discovered or arising which, if existing or occurring at the date of
this Agreement, would have been required to be set forth or described in the
Acquiror Disclosure Schedule. No such disclosure relating to the Acquiror
Disclosure Schedule made pursuant to this Section shall be deemed to cure any
breach of any representation of or warranty made in this Agreement unless the
Company specifically agrees thereto in writing.
6.02. Covenant to Satisfy Conditions. Acquiror will use its best efforts
to ensure that the conditions set forth in Article VII hereof are satisfied,
insofar as such matters are within the control of Acquiror provided, however,
that such best efforts shall not include any requirement to expend funds, to
commence litigation, or to grant or offer any accommodation (financial or
otherwise) to any third party.
6.03. Certificates. At the Closing Acquiror will furnish the Sellers
with such certificates of its officers and others to evidence compliance with
the covenants set forth in this Article VI as may be reasonably requested by
the Company.
6.04. HSR Act Filings. Acquiror will make all filings required to be
made pursuant to the HSR Act in connection with the transactions contemplated
by the Agreement and will furnish to the Sellers such necessary information and
reasonable assistance as the Sellers may request in connection with their
preparation of necessary filings or submissions under provisions of the HSR
Act. Acquiror will supply the Sellers copies of all correspondence, filings or
communications (or memoranda setting forth the substance thereof) between
Acquiror or its representatives, on the one hand, and the Federal Trade
Commission, the Antitrust Division of the U.S. Department of Justice or any
other governmental agency or authority or members of their respective staffs
on the other hand, with respect to this Agreement or the transactions
contemplated hereby, other than confidential or proprietary information
therein.
6.05. Consents. Acquiror will use its best efforts to obtain, prior to
the Closing, all consents necessary to be obtained by Acquiror in connection
with the consummation of the transactions contemplated by this Agreement
provided, however, that such best efforts shall not include any requirement to
expend funds, to commence litigation, or to grant or offer any accommodation
(financial or otherwise) to any third party. All such consents will be in
writing and executed counterparts thereof will be delivered to the Company at
or prior to the Closing.
6.06. Other Agreements. Acquiror shall deliver to the Sellers on the
Closing Date executed counterparts of the agreements and documents set forth in
Section 1.05(b).
6.07. Substitute Letters of Credit. On or prior to the Closing, Acquiror
shall either assume existing letters of credit tendered by the Company to the
third parties that are parties to the Container Purchase Commitments or tender
substitute letters of credit (to the extent letters of credit are required
under such contracts). To the extent that any such letters of credit of the
Company are not assumed by Acquiror, Acquiror shall take all actions that are
necessary in order to obtain the release of any letters of credit tendered by
the Company pursuant to such Container Purchase Commitments.
6.08. Insurance. Upon the payment by the Company or MNC of any fee
required by any insurance carrier, the Company and MNC shall be named as an
additional insured party on all insurance policies regarding the Sale Assets
and Container Operations, but only with respect to liabilities to third parties
arising after the Closing Date so long as the Names and Marks remain on the
Containers. Acquiror shall notify the Sellers of any fees required by any
insurance carrier pursuant to the preceding sentence.
6.09. Post Closing Financial Statements. If the Closing occurs on or
before June 30, 1995, on or before the close of business on July 17, 1995,
Acquiror will use reasonable efforts to prepare and deliver to the Sellers
consolidated and consolidating financial statements for the Company and its
Subsidiaries, including balance sheets, income statements and cash flow
statements, for the six month period ended June 30, 1995, all prepared in
accordance with generally accepted accounting principles and on a basis
consistent with similar statements prepared by the Company for the year ended
December 31, 1994. The Sellers acknowledge and agree that the Acquiror has
agreed to prepare and deliver such financial statement solely as an
accommodation to Sellers and that Acquiror shall bear no liability with respect
to, nor any responsibility for, the accuracy, adequacy or sufficiency of such
financial statements for any purpose, nor the Sellers' use of such financial
statements, including the Sellers' inclusion of such financial statements in
the consolidated and consolidating financial statements of the Sellers' Group
or Alexander & Baldwin, Inc., a Hawaii corporation, and, notwithstanding
anything herein to the contrary, Sellers agree to immediately indemnify
Acquiror against any Damages (as defined in Article XI) resulting from the
preparation and delivery of such financial statements or the use thereof by
Sellers.
6.10. Performance of Certain Obligations by Acquiror After Closing Date.
On and after the Closing Date, Acquiror shall, or shall cause its designated
subsidiaries to, duly, promptly and faithfully pay, perform and discharge when
due, all obligations and liabilities under the Assumed Liabilities.
ARTICLE VII
CONDITIONS TO THE OBLIGATIONS OF THE SELLERS
Each and every obligation of the Sellers under this Agreement to be
performed on or before the Closing shall be subject to the satisfaction, on or
before the Closing, of each of the following conditions, unless waived in
writing by the Company:
7.01. Representations and Warranties True. The representations and
warranties contained in Article IV hereof and in all certificates delivered and
to be delivered by Acquiror or the Acquiror Entities to the Sellers or their
representatives pursuant hereto or in connection with the transactions
contemplated hereby shall be in all material respects true, complete and
accurate as of the date when made and as of the Closing as though such
representations and warranties were made at and as of such date, except for
changes expressly permitted or contemplated by the terms of this Agreement.
7.02. Performance. Acquiror shall have performed and complied with all
agreements, obligations and conditions required by this Agreement to be
performed or complied with by it on or prior to the Closing.
7.03. HSR Act Waiting Periods; No Governmental Proceeding or Litigation.
All waiting periods applicable to the transactions contemplated hereby with
respect to the Sale Assets under the HSR Act shall have expired or been
terminated. No suit, action or other proceeding by any governmental body shall
have been instituted or threatened which questions in any material way the
validity or legality of the transfer of the Sale Assets.
7.04. No Litigation. On the Closing Date, there shall be no litigation
pending or, to the knowledge of the Sellers, threatened, which challenges or
questions the validity or legality of the execution and delivery of this
Agreement or the other documents, instruments or agreements required to be
executed or delivered pursuant hereto or which, if adversely determined, would
materially adversely affect the right, power and authority of the Sellers to
consummate the transactions contemplated hereby, or which imposes any
conditions on the consummation of the transactions contemplated hereby which
the Sellers deem unacceptable in their sole discretion.
7.05. Certificates. Acquiror shall have furnished the Sellers with such
certificates of its officers and others to evidence compliance with the
conditions set forth in this Article VII as may be reasonably requested by the
Sellers.
7.06. Opinion of Acquiror's Counsel. Acquiror shall have delivered to
the Sellers an opinion of Ropes & Gray, counsel to Acquiror, dated as of the
Closing Date, substantially in the form attached hereto as Exhibit S, and an
opinion of James R. Lajoie, General Counsel of Acquiror, dated as of the
Closing Date, in substantially the form attached hereto as Exhibit X.
7.07. Consents Obtained. All necessary consents referred to in Sections
4.02, 4.03, 4.04 and 4.06 shall have been obtained.
7.08. Other Agreements. Acquiror shall deliver to the Sellers on the
Closing Date executed counterparts of the agreements and documents set forth in
Section 1.05(b).
7.09. Opinion of Morgan, Lewis & Bockius. The Sellers shall have
received an opinion to Morgan, Lewis & Bockius, dated as of the Closing Date,
substantially in the form attached hereto as Exhibit T.
7.10. Release of Letters of Credit. All letters of credit tendered on
behalf of the Company pursuant to Container Purchase Commitments shall have
been released, extinguished, or assumed by Acquiror.
ARTICLE VIII
CONDITIONS TO OBLIGATIONS OF ACQUIROR
Each and every obligation of Acquiror under this Agreement to be performed
on or before the Closing shall be subject to the satisfaction, on or before the
Closing, of each of the following conditions, unless waived in writing by
Acquiror:
8.01. Representations and Warranties True. The representations and
warranties contained in Article III hereof, the Company Disclosure Schedule and
in all certificates delivered and to be delivered by the Sellers to Acquiror or
its representatives pursuant hereto or in connection with the transactions
contemplated hereby shall be in all material respects true, complete and
accurate as of the date when made and as of the Closing as though such
representations and warranties were made at and as of such date, except for
changes expressly permitted or contemplated by the terms of this Agreement.
8.02. Performance. The Sellers shall have performed and complied with
all agreements, obligations and conditions required by this Agreement to be
performed or complied with by it on or prior to the Closing.
8.03. HSR Act Waiting Periods; No Governmental Proceeding or Litigation.
All waiting periods applicable to the transactions contemplated hereby with
respect to the Sale Assets under the HSR Act shall have expired or been
terminated. No suit, action or other proceeding by any governmental body shall
have been instituted or threatened which questions in any material way the
validity or legality of the transfer of the Sale Assets.
8.04. No Litigation. On the Closing Date, there shall be no litigation
pending or, to the knowledge of Acquiror, threatened, which challenges or
questions the validity or legality of the execution and delivery of this
Agreement or the other documents, instruments or agreements required to be
executed or delivered pursuant hereto or which, if adversely determined, would
materially adversely affect the right, power and authority of Acquiror to
consummate the transactions contemplated hereby, or which imposes any
conditions on the consummation of the transactions contemplated hereby or
adversely affects the right of Acquiror to own the Sale Assets, to operate the
Container Operations or to control the Subsidiaries of the Company, which the
Acquiror deems unacceptable in its sole discretion.
8.05. Opinion of the Sellers' Counsel. The Sellers shall have delivered
to Acquiror the opinion of Gibson, Dunn & Crutcher, counsel to the Sellers,
dated as of the Closing Date, substantially in the form attached hereto as
Exhibit U, and an opinion of Kevin C. O'Rourke, General Counsel of MNC, dated
as of the Closing Date, in substantially the form attached hereto as Exhibit Y.
8.06. Consents Obtained. All necessary consents referred to in Sections
3.09 and, with respect to the Designated Commitments, 3.10, shall have been
obtained. The Acquiror acknowledges and agrees that, except to the extent
provided in the first sentence of Section 5.02, the Sellers shall not have any
liability whatsoever to the Acquiror arising out of or relating to the failure
to obtain any consents that may be required for the assignment of any
Commitment to the Acquiror or because of the default, acceleration or
termination of any Commitment as a result thereof, it being understood that the
procurement of such consents is a condition to closing only. With respect to
any Commitment, other than a Designated Commitment, that cannot be assigned to
the Acquiror without resulting in a default, acceleration or termination
thereof, the Company, at the Acquiror's request, shall perform its obligations
as agent for the benefit of the Acquiror under any such Commitment for the
remaining term of any such Commitment and the Acquiror agrees to reimburse the
Company for any and all reasonable costs and expenses incurred by the Company
in the performance of said obligations on behalf of the Acquiror.
8.07. Other Agreements. The Company shall deliver to Acquiror on the
Closing Date executed counterparts of the agreements and documents set forth in
Section 1.05(a)(I) and MNC shall deliver to Acquiror on the Closing Date
executed counterparts of the agreements and documents set forth in Section
1.05(a)(II) and MNC shall cause the MNC Subsidiaries to deliver to Acquiror on
the Closing Date duly executed counterparts of the Assignment and Assumption of
Container Leases.
8.08. Opinion of Morgan, Lewis & Bockius. The Acquiror shall have
received an opinion of Morgan, Lewis & Bockius, dated as of the Closing Date,
substantially in the form attached hereto as Exhibit T.
8.09. FIRPTA Certificate. Acquiror shall have received from the Sellers
a certificate of non-foreign status under Treas. Reg. Section1-1445-2(b)(2) in
form and substance reasonably satisfactory to the Acquiror.
8.10. Certificates. Sellers shall have furnished the Acquiror with such
certificates of its officers and others to evidence compliance with the
conditions set forth in this Article VIII as may be reasonably requested by
Acquiror.
ARTICLE IX
(INTENTIONALLY OMITTED)
ARTICLE X
EMPLOYEES
10.01. Offer of Employment. Acquiror shall, effective as of the Closing,
offer to employ beginning on the Closing Date all of the Employees at no less
than current base salary and at their current locations, but subject to such
other benefits, terms and conditions of employment as Acquiror may determine,
provided that such other benefits, terms and conditions of domestic employees
are no less favorable than those that Acquiror provides to its current
employees; and provided further that for purposes of Acquiror's welfare and
benefit plans, Acquiror shall waive all pre-existing condition exclusions and
will give the Employees credit for years of service with the Company. Subject
in each case to Section 10.02 below, Acquiror shall bear and discharge any and
all of such liability in respect of the employment (or termination thereof) of
the Employees from and after the Closing. Acquiror shall indemnify and save
harmless Sellers from and against any and all losses, damages, expenses,
liabilities, claims and demands whatsoever made or brought against Sellers by
any Employee who accepts Acquiror's offer of employment or by any federal,
state or local governmental authority which in any way pertains to or arises
out of such liability including, any interest, award, judgement or penalty
relating thereto and any costs or expenses incurred by Sellers in defending any
such claim or demand.
10.02. Sellers' Obligations. With respect to any and all liability in
respect of the employment of the Employees on or prior to the Closing, Sellers
shall, except to the extent expressly included within the Assumed Liabilities,
bear, discharge and be responsible for payment of all severance, termination,
pay in lieu of termination, damages for wrongful or constructive dismissal,
provision of continuation coverage under Section 601 et. seq. of ERISA, and
other similar liabilities incurred in connection with the termination of
employment of any of the Employees at or prior to the Closing (including
without limitation any termination of the employment relationship with Seller
occurring by reason of the transactions contemplated by this Agreement) or who
refuse to accept Acquiror's offer of employment. In addition, Sellers will pay
or reimburse Acquiror for the cost of any accrued payroll and vacation to the
Closing Date of all Employees of the Subsidiaries. Sellers shall indemnify and
save Acquiror harmless from and against any and all losses, damages, expenses,
liabilities, claims and demands whatsoever made or brought against Acquiror by
any such Employee or other person, or any federal, state or local governmental
authority or body which in any way pertains to or rises out of such liability,
including any interest, award, judgement or penalty relating thereto and any
costs or expenses incurred by Acquiror in defending any such claim or demand.
10.03. Cooperation. During the period following the date hereof, up to
and including the Closing Date, Sellers and Acquiror shall cooperate in
communicating with the Employees any information relating to the acquisition of
the Sale Assets and Container Operations by the Acquiror from the Sellers.
10.04. Non-solicitation. Sellers agree not to solicit any of the
Employees for the period ending two years following the Closing.
ARTICLE XI
SURVIVAL OF REPRESENTATIONS AND
WARRANTIES; INDEMNIFICATION; ARBITRATION
11.01. Survival of Representations and Warranties. All representations
and warranties made in Sections 3.02, 3.06, 3.12 and 4.02 shall survive the
Closing hereunder and any investigation at any time made by or on behalf of the
other party. All representations and warranties made in Section 3.19 shall
expire on the Closing Date. All other representations and warranties shall
survive for two years after the Closing hereunder (the "Expiration Date").
11.02. Statements as to Representations. All statements contained herein
or in the Disclosure Schedules delivered pursuant hereto (except as
specifically stated) shall be deemed representations and warranties within the
meaning of Sections 7.01, 8.01 and 11.01 hereof. The Acquiror specifically
acknowledges and agrees that (i) other than the representations and warranties
of the Sellers specifically contained in this Agreement, there are no
representations or warranties of the Sellers either expressed or implied with
respect to the Company, the Subsidiaries, the Sale Assets, and Assumed
Liabilities or the Container Operations and (ii) with respect to this
Agreement, Acquiror shall have a right to indemnification solely as provided in
this Article XI (except to the extent provided in Sections 6.09 and 13.12) and
that it shall have no claim or right to indemnification with respect to any
other information, documents or materials furnished by the Sellers or any of
their officers, directors, employees, agents or advisors to the Acquiror,
including, without limitation, any information, documents or material made
available to Acquiror in the "data room" organized for the purposes of the
transactions contemplated by this Agreement.
11.03. Agreement to Indemnify by the Sellers. Subject to the conditions
and provisions herein set forth, the Sellers, jointly and severally, hereby
agree to indemnify, defend and hold harmless Acquiror and each parent,
subsidiary and Affiliate of Acquiror from and against all demands, claims,
actions or causes of action, assessments, losses, damages, liabilities,
out-of-pocket costs and expenses, including, without limitation, interest,
penalties and attorney's fees, asserted against or imposed upon or incurred by
Acquiror or any parent, subsidiary or Affiliate of Acquiror resulting from (i)
a breach of any then surviving representation or warranty of any of the Sellers
contained in or made pursuant to this Agreement, (ii) any obligation,
responsibility, claim or liability of the Sellers (including, without
limitation, any indemnification or similar arrangement under any lease),
whether known or unknown, contingent, absolute or otherwise, other than those
obligations, responsibilities, claims or liabilities assumed by Acquiror as
part of the Assumed Liabilities under this Agreement, (iii) the nonperformance,
partial or total, of any agreement of
the Sellers contained in this Agreement or any of the documents delivered
pursuant to Section 1.05(a), (iv) as a result of injury to or sustained by any
person on or prior to the Closing or injury to or destruction of tangible
property on or prior to the Closing arising out of the conduct of the Container
Operations on or prior to the Closing, or (v) as a result of any failure of
Sellers to transfer to Acquiror good, valid, and marketable title in and to the
Software and Intellectual Property Rights, free of any liens, claims, charges,
security interests, restrictions on transfer (or claims alleging a failure to
obtain consent to transfer) or other encumbrances (except to the extent that
any adverse claim or defect in title does not impair Acquiror's ability to use
the Software or Intellectual Property Rights in the Container Operations) or
any infringment of the intellectual property rights of others arising from the
use of such Software or Intellectual Property Rights in the Container
Operations (collectively, "Damages"). With respect to all representations and
warranties of the Sellers other than those set forth in Sections 3.02, 3.06 and
3.12 hereof, Acquiror shall not be entitled to recover for and agrees not to
assert any claim for breach of any such representations or warranties
(including without limitation any claim for indemnification for breach of a
representation or warranty under clause (i) of this Section 11.03, unless
Acquiror delivers to the Sellers, in writing, on or prior to the Expiration
Date, a notice in accordance with Section 11.05 specifying such claim of
breach. Notwithstanding any language contained herein to the contrary, (A) the
Seller's shall not have any liability under Section 11.03(i) until the
cumulative Damages relating to such representations and warranties exceeds
$200,000 in the aggregate, in which case the Sellers shall pay all such amounts
of Damages claimed; provided, however, that the parties understand and agree
that the $200,000 threshold described in this Section 11.03 is applicable only
with respect to claims for Damages under this Article XI and is specifically
not available to offset adjustments to the consideration set forth in Section
1.03(a)(A) pursuant to Section 1.07 hereof; (B) Sellers shall have no liability
under clause (i) in respect of any matter or category of matter (e.g.
uncollectible accounts) for which an express reserve or valuation adjustment or
allowance is reflected on the Consolidated Statement of Net Assets specifically
for such matter or category of matters; and (C) Sellers' aggregate liability
under this Section 11.03 shall in no event exceed $350,000,000. The Acquiror
acknowledges and agrees that, except as otherwise provided in this Agreement or
any agreement executed between the parties hereto in connection with the
transactions contemplated hereby, from and after the Closing, its sole and
exclusive remedy with respect to any and all claims (other than claims of, or
causes of action arising from, fraud) for money damages (as opposed to
equitable claims and remedies) relating to the subject matter of this Agreement
shall be pursuant to the indemnification provisions set forth in this Section
11.03. In furtherance of the foregoing, the Acquiror hereby waives, from and
after the Closing, to the fullest extent permitted under applicable law, any
and all rights, claims and causes of action (other than claims of, or causes of
action arising from, fraud) it may have against the Sellers relating to the
subject matter of this Agreement arising under or based upon any federal, state
or local statute, law, ordinance, rule or regulation or otherwise.
11.04. Agreement to Indemnify by Acquiror. Subject to the conditions and
provisions herein set forth, Acquiror, jointly and severally with any Acquiror
Entity, hereby agrees to indemnify, defend and hold harmless the Sellers and
each parent, subsidiary and Affiliate of the Sellers from and against all
demands, claims, actions or causes of action, assessments, damages,
liabilities, out-of-pocket costs and expenses, including, without limitation,
interest, penalties and attorney's fees, asserted against or imposed upon or
incurred by the Sellers or any parent, subsidiary or Affiliate of the Sellers
resulting from (i) a breach of any surviving representation or warranty of
Acquiror contained in or made pursuant to this Agreement, (ii) the breach or
nonperformance, total or partial, of any Assumed Liability and any other
obligation, responsibility, claim or liability of Acquiror and its subsidiaries
(including, without limitation, any indemnification or similar arrangement
under any lease), whether known or unknown, contingent, absolute or otherwise,
(iii) the breach or nonperformance, total or partial, of any agreement of
Acquiror or any Acquiror Entity contained in this Agreement or any of the
documents or agreements delivered pursuant to Section 1.05(b) (including any
breach or nonperformance by Acquiror or any Acquiror Entity of the Assignment
and Assumption Agreements), (iv) as a result of injury to or sustained by any
person after the Closing or injury to or destruction of tangible property after
the Closing arising out of the conduct of the Container Operations after the
Closing or (v) the Container Operations after the Closing, including the use of
the Names and Marks by Acquiror, any Acquiror Entity or any Subsidiary (on
Containers or otherwise) following the Closing pursuant to the License
Agreement (collectively, "Damages"). With respect to all representations and
warranties of Acquiror, the Sellers shall not be entitled to recover for and
agree not to assert any claim for breach of any such representations or
warranties (including without limitation any claim for indemnification for
breach of a representation or warranty under clause (i) of this Section 11.04)
unless the Sellers deliver to Acquiror, in writing, on or prior to the
Expiration Date, a notice specifying such claim of breach. Notwithstanding any
language to the contrary contained herein (A) Acquiror and the Acquiror
Entities shall not have any liability under Section 11.04(i) until the
cumulative Damages relating to such representations and warranties exceed
$200,000 in the aggregate, in which case the Acquiror shall pay all such
amounts of Damages claimed and (B) Acquiror's aggregate liability under this
Section 11.04 shall in no event exceed $350,000,000. The Sellers acknowledge
and agree that, except as otherwise provided in this Agreement or any agreement
executed between the parties hereto in connection with the transactions
contemplated hereby, from and after the Closing, their sole and exclusive
remedy with respect to any and all claims (other than for, or for courses of
action arising from, fraud) for monetary damages (as opposed to equitable
claims and remedies) relating to the subject matter of this Agreement shall
be pursuant to the indemnification provisions set forth in this Section 11.04.
In furtherance of the foregoing, each of the Sellers hereby waives, from and
after the Closing, to the fullest extent permitted under applicable law, any
and all rights, claims and causes of action (other than claims of, or cause of
action arising from, fraud) it may have against Acquiror relating to the
subject matter of this Agreement arising under or based upon any federal, state
or local statute, law, ordinance rule or regulation or otherwise.
11.05. Procedures Relating to Indemnifications. (a) In the event of any
claim by a party seeking indemnification under this Article XI or any other
section of this Agreement expressly providing for indemnification of one party
by the other (an "indemnified party"), the indemnified party shall notify the
party from whom indemnification is sought (the "indemnifying party") in writing
of said claim, which notice shall set forth the basis of the claim for Damages
and, if then determinable by the indemnified party, a reasonable estimate of
the amount thereof (or if, in the indemnified party's good faith opinion, no
such reasonable estimate can then be made by it, the maximum potential Damages
that, in the indemnified party's good faith opinion, might be sustained in
connection with such claim).
(b) In order for an indemnified party to be entitled to any
indemnification provided for under this Agreement in respect of, arising out of
or involving a claim or demand made by any person, firm , governmental
authority or corporation against the indemnified party (a "Third Party
Claim"), such indemnified party must notify the indemnifying party in writing,
and in reasonable detail, of the Third Party Claim promptly after receipt by
such indemnified party of written notice of the Third Party Claim; provided,
however, that failure to give such notification shall not affect the
indemnification provided hereunder except to the extent the indemnifying party
shall have been actually prejudiced as a result of such failure (except that
the Indemnifying Party shall not be liable for any expenses incurred during the
period in which the indemnified party failed to give such notice). Thereafter
the indemnified party shall deliver to the indemnifying party, promptly after
the indemnified party's receipt thereof, copies of all notices and documents
(including court papers) received by the indemnified party relating to the
Third Party Claim.
If a Third Party Claim is made against an indemnified party, the
indemnifying party will be entitled to participate in the defense thereof and,
if it so chooses, to assume the defense thereof with counsel selected by the
indemnifying party. Should the indemnifying party so elect to assume the
defense of a Third Party Claim, the indemnifying party will not be liable to
the indemnified party for legal fees and expenses subsequently incurred by the
indemnified party in connection with the defense thereof. If the indemnifying
party assumes such defense, the indemnified party shall have the right to
participate in the defense thereof and to employ counsel, at its own expense,
separate from the counsel employed by the indemnifying party, it being
understood that the indemnifying party shall control such defense. The
indemnifying party shall be liable for the fees and expenses of counsel
employed by the indemnified party for any period during which the indemnifying
party has not assumed the defense thereof (other than during any period in
which the indemnified party shall have failed to give notice of the Third Party
Claim as provided above). If the indemnifying party chooses to defend or
prosecute any Third Party Claim, all the parties hereto shall cooperate in the
defense or prosecution thereof. Such cooperation shall include the retention
and (upon the indemnifying party's request) the provision to the indemnifying
party of records and information which are reasonably relevant to such Third
Party Claim, and making employees available on a mutually convenient basis to
provide additional information and explanation of any material provided
hereunder. Whether or not the indemnifying party shall have assumed the
defense of a Third Party Claim, the indemnified party shall not admit any
liability with respect to, or settle, compromise or discharge, such Third Party
Claim without the indemnifying party's prior written consent (which consent
shall not be unreasonably withheld).
(c) Notwithstanding anything in this Section 11.05 the contrary, in
the event of a Third Party Claim relating to Transfer Taxes described in
Section 13.03, Sellers shall be entitled to participate in the defense of such
claim at their own expense and on any equal basis with Acquiror, and both
Sellers and Acquiror must consent (which consent may not be unreasonably
withheld) to any resolution of any such claim.
11.06. Losses Net of Insurance, etc. The amount of any loss, liability,
claim, damage, expense or tax for which indemnification is provided under this
Article XI shall be net of any amounts recovered by the indemnified party under
insurance policies with respect to such loss, liability, claim, damage, expense
or tax and shall be reduced to take account of any actual net tax benefit
realized (taking into account the receipt of the indemnity payment) by the
indemnified party arising from the incurrence or payment of any such loss,
liability, claim, damage, expense or tax. In computing the amount of any
such actual net tax benefit realized, (i) the undemnified party shall be deemed
to recognize all other items of income, gain, loss, deduction or credit before
recognizing any item arising from the incurrence or payment of any indemnified
loss, liability claim, damage, expense or tax and (ii) the parties agree to
treat all payments pursuant to this Article XI as an adjustment to the purchase
price for the Sale Assets, unless otherwise required by law.
11.07. Tax Matters.
(a) Tax Indemnification. The Sellers, jointly and severally,
shall be liable for and indemnify Acquiror and each parent, subsidiary and
Affiliate of Acquiror for any and all Pre-Closing Taxes and any and all
out-of-pocket costs, including attorney's fees, incurred by Acquiror or
any parent, subsidiary or Affiliate of Acquiror relating to any and all
Pre-Closing Taxes. Acquiror shall be liable for and shall indemnify
Sellers and each parent, subsidiary and Affiliate of Sellers for all Taxe
of Acquiror and its Affiliates, including the Subsidiaries, for periods
following the Closing, other than Pre-Closing Taxes. For purposes of this
Agreement, "Pre-Closing Taxes" means all Taxes (i) of the Sellers, the
Subsidiaries and the Branches attributable to periods ending on or prior
to the Closing, and (ii) imposed against the Sellers' Group whether under
Treas. Reg. Section1.1502-6 (or any similar provision of state, local or
foreign law), as a transferee or successor, by contract or otherwise, but
excluding (x) any Transfer Taxes payable by Acquiror pursuant to Section
13.03 of this Agreement, (y) any Taxes that are Assumed Liabilities and
that are included in the Consolidated Statement of Net Assets as finally
determined, and (z) any Taxes arising from actions taken outside the
ordinary course of business following the Closing on the Closing Date at
the request of or for the benefit of Acquiror.
(b) Apportionment of Income Taxes. In order to appropriately
determine the amount of Pre-Closing Taxes relating to any taxable year or
period that begins before and ends after the Closing Date, the parties
hereto shall, to the extent permitted by applicable law, elect with the
relevant taxing authority to terminate the taxable year as of such date.
In any case where applicable law does not permit a Subsidiary or Branch to
treat such date as of the end of a taxable year of such Subsidiary or
Branch, then, for purposes of determining Pre-Closing Taxes, the taxable
year of such Subsidiary or Branch shall be treated as having ended on the
Closing Date and the Taxes attributable to the period ending on such date
shall (unless otherwise agreed to in writing by Acquiror and Sellers) be
determined by a closing of such Subsidiary's or Branch's books, except
that exemptions, allowances or deductions that are calculated on an annual
basis, such as the deduction for depreciation, shall be apportioned on a
time basis.
(c) Apportionment of Other Taxes. In order to appropriately
determine the amount of Pre-Closing Taxes, other than income Taxes,
relating to any taxable year or period that begins before and ends after
the date of the Financial Statements or the Closing Date, (i) ad valorem
Taxes (including, without limitation, real and personal property Taxes)
shall be accrued on a monthly basis over the period for the which the
Taxes are levied, or if it cannot be determined over what period the Taxes
are being levied, over the fiscal period of the relevant taxing authority,
in each case irrespective of the lien or assessment date of such Taxes,
and (ii) franchise and other privilege Taxes not measured by income shall
be accrued on a monthly basis over the period to which the privilege
relates, provided, however, that any increase or decrease in any Taxes
described in clauses (i) or (ii) for periods following the Closing and
resulting from the Closing or other actions taken by Acquiror, its
Affiliates (including the Subsidiaries) or their transferees following
the Closing shall be the responsibility of the Acquiror.
(d) Tax Sharing Agreements. Any tax sharing agreement between
the Subsidiaries and any of the Sellers or any Affiliate of the Sellers
shall be terminated as of the Closing Date and will have no further effect
for any taxable year (whether the current year, a future year, or a past
year). Each Seller and all Affiliates of the Sellers shall cancel any
intercompany accounts in respect of Taxes with the Subsidiaries as of the
Closing.
(e) Assistance and Cooperation. After the Closing Date, each
of Sellers and Acquiror shall:
(i) take reasonable steps to assist (and cause their respective
Affiliates to assist) the other party, as reasonably requested, in preparing
any Tax Returns which such other party is responsible for preparing and filing
with respect to the Container Operations;
(ii) take reasonable steps to cooperate with the other in preparing for
any audits of, or disputes with taxing authorities regarding, any Tax Returns
of the Sellers, the Subsidiaries and Branches with respect to the Container
Operations;
(iii) make available to the other and to any taxing authority as
reasonably requested all information, records and documents (other than such
items for which a party asserts the attorney-client or attorney work-product
privilege) relating to Taxes of the Sellers, Acquiror, the Subsidiaries and
Branches with respect to the Container Operations, which each party shall
retain for the latest of the applicable statute of limitations relating to
Taxes to which such information, records and documents may relate;
(iv) provide timely notice to the other in writing of any pending or
threatened Tax audits or assessments of the Sellers, the Subsidiaries and
Branches on the one hand and Acquiror, the Subsidiaries and Branches on the
other hand for taxable periods for which the other may have an interest; and
(v) furnish the other with copies of all correspondence received from any
taxing authority in connection with any Tax audit or information request with
respect to any such taxable period referred to in the above paragraph (iv).
The covenants set forth in this Section 11.07(e) shall be in addition to
the provisions set forth in Section 2.02.
(f) No Section 338 Election. No person or entity (including
without limitation, following the Closing, PICC) shall make an election
under Section 338 of the Code with respect to the transfer of the stock of
any of the Foreign Subsidiaries pursuant to this Agreement, and Acquiror
shall indemnify and hold harmless Sellers and their Affiliates from and
against any and all Taxes and costs incurred in connection with any such
election.
(g) California Sales Tax Certificate. Sellers will cooperate
with Acquiror in Acquiror's efforts to obtain a certificate described in
Section 6813 of the California Revenue and Taxation Code with respect to
the liability of Sellers for California sales and use taxes.
(h) Survival of Obligations. The obligations of the parties
set forth in this 11.07 relating to Taxes shall, except as provided herein
or otherwise agreed to in writing, be unconditional and absolute and shall
remain in effect without limitation as to time or amount of recovery by
Acquiror or Sellers.
11.08. Arbitration. Any dispute as to any claims hereunder, other than
as set forth in Section 1.07, shall be settled by arbitration in the City of
New York by three arbitrators, one of whom shall be appointed by the Sellers,
one by Acquiror and the third of whom shall be appointed by the first two
arbitrators. If either party fails to appoint an arbitrator within 20 days of
a request in writing by the other party to do so or if the first two
arbitrators cannot agree on the appointment of a third arbitrator within 20
days of their designation, then such arbitrator shall be appointed by the Chief
Judge of the United States District Court for the Southern District of New
York. Except as to the selection of arbitrators which shall be as set forth
above, the arbitration shall be conducted promptly and expeditiously in
accordance with the rules of the American Arbitration Association so as to
enable the arbitrators to render an award as expeditiously as possible.
Judgment upon the award rendered by the arbitrators may be entered in any court
having jurisdiction thereof. Each party shall bear the expenses of its
arbitrator and shall jointly and equally share with the other the expenses for
the third arbitrator and the arbitration.
ARTICLE XII
TERMINATION AND ABANDONMENT
12.01. Methods of Termination. The transactions contemplated herein may
be terminated and/or abandoned at any time, but not later than the Closing:
(a) By mutual consent of the Acquiror and the Company; or
(b) By the Acquiror on or after September 30, 1995, if any of the
conditions provided for in Article VIII of this Agreement shall not have been
met or waived in writing by Acquiror prior to such date; or
(c) By the Company on or after September 30, 1995, if any of the
conditions provided for in Article VII of this Agreement shall not have been
met or waived in writing by the Company prior to such date.
12.02. Procedure upon Termination. In the event of termination or
abandonment pursuant to Section 12.01 hereof, written notice thereof shall
forthwith be given to the other party and the transactions contemplated by this
Agreement shall be terminated and abandoned, without further action by the
parties hereto. If the transactions contemplated by this Agreement are
terminated and abandoned as provided herein pursuant to Section 12.01:
(a) Each party will redeliver all documents, work papers and other
material of any other party (including all copies) relating to the transactions
contemplated hereby, whether so obtained before or after the execution hereof,
to the party furnishing the same;
(b) All confidential information received by any party hereto with
respect to the business of any other party or its subsidiaries shall be treated
in accordance with Section 2.01 hereof; and
(c) No party hereto shall have any liability or further obligation
to any other party to this Agreement except as stated in subparagraphs (a) and
(b) of this Section 12.02, and except for breaches of this Agreement occurring
prior to termination of this Agreement.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
13.01. Amendment and Modification. Subject to applicable law, this
Agreement may be amended, modified and supplemented by written agreement of the
Company and Acquiror or by their respective duly authorized officers at any
time prior to the Closing with respect to any of the terms contained herein.
13.02. Waiver of Compliance. Any failure of the Sellers, on the one
hand, or Acquiror, on the other, to comply with any obligation, covenant,
agreement or condition herein may be expressly waived in writing by the
Chairman of the Board, President or a Vice President of Acquiror or the
Company, respectively, but such waiver or failure to insist upon strict
compliance with such obligation, covenant, agreement or condition shall not
operate as a waiver of, or estoppel with respect to, any subsequent or other
failure.
13.03. Expenses; Transfer Taxes. Except as otherwise provided in Section
2.02 hereof, whether or not the transactions contemplated by this Agreement
shall be consummated, the Sellers agree that all fees and expenses incurred by
them in connection with this Agreement shall be borne by the Sellers and
Acquiror agrees that all fees and expenses incurred by it in connection with
this Agreement shall be borne by Acquiror including, without limitation, all
fees of counsel, actuaries and accountants. Notwithstanding the foregoing, any
and all sales, use, VAT, transfer, foreign transaction, excise, property or
other similar national, federal, state, local, provincial Taxes, other than any
Taxes based on net income, together with any interest and penalties pertaining
thereto ("Transfer Taxes"), that may be payable in connection with the sale and
transfer of the Sale Assets shall be apportioned among the parties as follows:
Acquiror shall pay all Transfer Taxes up to $240,000 and Sellers on one hand
and Acquiror on the other hand shall each pay one-half of all Transfer Taxes in
excess of such amount. Sellers shall provide to Acquiror, prior to the Closing,
a schedule showing in reasonable detail the amount of any Transfer Taxes
payable by Acquiror in connection with the transfer of the Sale Assets, such
amounts to be determined in a manner consistent with the allocations set forth
on Exhibit A. Acquiror shall pay such amount (the "Initial Transfer Tax
Payment") to Sellers, in the manner provided in Section 1.03(a)(B) hereof at
the Closing, and Sellers shall pay such amount, together with any remaining
amount of Transfer Taxes determined by Seller, to the appropriate taxing
authorities as soon as practicable thereafter. In the event of an adjustment
to the consideration as a result of the application of Section 1.07 hereof,
within a reasonable time following such adjustment, Sellers shall provide to
Acquiror a revised statement of Transfer Taxes, and Sellers shall refund to
Acquiror, or Acquiror shall pay to Sellers, as the case may be, the applicable
portion of any difference between such revised amount and the Initial Transfer
Tax Payment. Sellers and Acquiror shall reasonably cooperate in attempting to
minimize the amount of any Transfer Taxes. Acquiror shall indemnify and hold
harmless Sellers and any Affiliates of Sellers from any Transfer Taxes in
excess of the Transfer Taxes, if any, that are the responsibility of Sellers
pursuant to this Section 13.03.
13.04. Notices. All notices, requests, demands and other communications
required or permitted hereunder shall be in writing and shall be deemed to have
been duly given if delivered by hand or mailed, certified or registered mail
with postage prepaid:
(a) If to Sellers, to:
Matson Leasing Company, Inc.
333 Market Street - 30th Floor
San Francisco, California 94105-2196
Attention: Vice President and CFO
Matson Navigation Company, Inc.
333 Market Street - 30th Floor
San Francisco, California 94105-2196
Attention: Senior Vice President and General Counsel
(with copies to:)
Gibson, Dunn & Crutcher
333 S. Grand Ave.
Los Angeles, California 90071
Attention: Bradford P. Weirick, Esq.
or to such other person or address as Sellers furnish to Acquiror in
writing.
(b) if to the Acquiror, to:
XTRA, Inc. c/o
X-L-Co., Inc.
60 State Street
Boston, Massachusetts 02109
Attention: Vice President and General Counsel
(with copies to:)
Ropes & Gray
One International Place
Boston, Massachusetts 02110
Attention: David A. Fine, Esq.
and
Morgan, Lewis & Bockius
801 S. Grand Ave.
Los Angeles, California 90017
Attention: William Ellis, Esq.
or to such other person or address as Acquiror shall furnish to
Seller in writing.
13.05. Assignment. This Agreement and all of the provisions hereof shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, but neither this Agreement nor any
of the rights, interests or obligations hereunder shall be assigned by any of
the parties hereto without the prior written consent of the other parties,
except by operation of law. Notwithstanding the foregoing, Acquiror shall be
entitled to designate one or more Acquiror Entities to receive some or all of
the Sale Assets and/or to assume some or all of the Assumed Liabilities at the
Closing; provided, however, that it is expressly agreed and acknowledged that,
for all purposes, Acquiror shall remain a party to this Agreement and shall
remain bound by the covenants and agreements of the Acquiror set forth herein.
13.06. Publicity. Neither the Sellers nor Acquiror shall make or issue,
or cause to be made or issued, any announcement or written statement concerning
this Agreement or the transactions contemplated hereby for dissemination to the
general public without the prior consent of the other party. This provision
shall not apply, however, to any announcement or written statement required to
be made by law or the regulations of any federal or state governmental agency
or any stock exchange, except that the party required to make such announcement
shall, whenever practicable, consult with the other party concerning the timing
and content of such announcement before such announcement is made.
13.07. Governing Law. This Agreement and the legal relations among the
parties hereto shall be governed by and construed in accordance with the laws
of the State of New York without regard to its conflicts of law doctrine.
13.08. Counterparts. This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
13.09. Headings. The headings of the Sections and Articles of this
Agreement are inserted for convenience only and shall not constitute a part
hereof or affect in any way the meaning or interpretation of this Agreement.
13.10. Entire Agreement. This Agreement, including the Exhibits hereto,
the Company Disclosure Schedule, and the other documents and certificates
delivered pursuant to the terms hereof, sets forth the entire agreement and
understanding of the parties hereto in respect of the subject matter contained
herein, and supersedes all prior agreements, promises, covenants, arrangements,
communications, representations or warranties, whether oral or written, by any
officer, employee or representative of any party hereto.
13.11. Third Parties. Except as specifically set forth or referred to
herein, nothing herein expressed or implied is intended or shall be construed
to confer upon or give to any person or corporation other than the parties
hereto and their successors or assigns any rights or remedies under or by
reason of this Agreement.
13.12. Bulk Transfers. The parties hereto waive compliance with the
requirements of the bulk sales law of any jurisdiction in connection with the
sale of the Sale Assets to Acquiror. Sellers shall indemnify and hold
harmless the Acquiror against all liabilities (other than the Assumed
Liabilities) which may be asserted by third parties with respect to assets sold
by the Seller as a result of noncompliance with any such bulk sales laws.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, all as of the day and year first above written.
XTRA, INC.
By /s/ James R. Lajoie
Title: Vice President
MATSON LEASING COMPANY, INC.
By /s/ Frederick Gutterson
Title: President
MATSON NAVIGATION COMPANY, INC.
By /s/ Kevin C. O'Rourke
Title: Vice President
Exhibit 10.a.(xxv) ALEXANDER & BALDWIN, INC. / SALE OF MATSON LEASING COMPANY, INC. PRO FORMA CONDENSED BALANCE SHEET (UNAUDITED) MARCH 31, 1995 (in thousands)