ý | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) |
Wisconsin | 39-0168610 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
(Title of each class) | (Name of each exchange on which registered) | ||||
Class A Common Stock, par value $0.20 per share | New York Stock Exchange |
Large accelerated filer | x | Accelerated filer | o | |
Non-accelerated filer | o | Smaller-reporting company | o | |
(do not check if a smaller reporting company) |
Item 1. | ||
Item 1A. | ||
Item 1B. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
Item 5. | ||
Item 6. | ||
Item 7. | ||
Item 7A. | ||
Item 8. | ||
Item 9. | ||
Item 9A. | ||
Item 9B. | ||
Item 10. | ||
Item 11. | ||
Item 12. | ||
Item 13. | ||
Item 14. | ||
Item 15. |
2013 | 2012 | |||||||
Quarter 1 (September-November) | 24 | % | 24 | % | ||||
Quarter 2 (December - February) | 23 | % | 24 | % | ||||
Quarter 3 (March - May) | 27 | % | 27 | % | ||||
Quarter 4 (June- August) | 26 | % | 25 | % | ||||
100 | % | 100 | % |
Name | Age | Position | |||
Robert C. Arzbaecher | 53 | Chief Executive Officer; Chairman of the Board | |||
William S. Blackmore | 57 | Executive Vice President—Engineered Solutions Segment | |||
Gustav H.P. Boel | 68 | Executive Vice President; Director | |||
Mark E. Goldstein | 57 | President; Director | |||
Sheri R. Grissom | 49 | Executive Vice President—Global Human Resources | |||
Brian K. Kobylinski | 47 | Executive Vice President—Industrial Segment and China | |||
Andrew G. Lampereur | 50 | Executive Vice President and Chief Financial Officer | |||
Sheri L. Roberts | 47 | Executive Vice President—Energy Segment | |||
David L. Scheer | 54 | Executive Vice President—Electrical Segment | |||
Theodore C. Wozniak | 55 | Executive Vice President—Business Development |
• | difficulties in integrating and managing personnel, financial reporting and other systems used by the acquired businesses; |
• | the failure of acquired businesses to perform in accordance with our expectations; |
• | failure to achieve anticipated synergies between our business units and the business units of acquired businesses; |
• | the loss of customers of acquired businesses; or |
• | the loss of key managers of acquired businesses. |
Number of Locations | Square Footage | |||||||||||||||||||
Distribution / Sales / Admin | ||||||||||||||||||||
Manufacturing | Total | Owned | Leased | Total | ||||||||||||||||
Industrial | 8 | 12 | 20 | 157 | 546 | 703 | ||||||||||||||
Energy | 11 | 29 | 40 | 40 | 974 | 1,014 | ||||||||||||||
Engineered Solutions | 18 | 5 | 23 | 634 | 817 | 1,451 | ||||||||||||||
Corporate and other | 1 | 4 | 5 | 353 | 111 | 464 | ||||||||||||||
38 | 50 | 88 | 1,184 | 2,448 | 3,632 |
Item 5. | Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities |
Fiscal Year | Period | High | Low | |||||||||
2013 | June 1, 2013 to August 31, 2013 | $ | 37.22 | $ | 31.18 | |||||||
March 1, 2013 to May 31, 2013 | 34.61 | 29.16 | ||||||||||
December 1, 2012 to February 28, 2013 | 31.77 | 26.20 | ||||||||||
September 1, 2012 to November 30, 2012 | 31.33 | 25.38 | ||||||||||
2012 | June 1, 2012 to August 31, 2012 | $ | 29.12 | $ | 24.23 | |||||||
March 1, 2012 to May 31, 2012 | 29.97 | 24.33 | ||||||||||
December 1, 2011 to February 29, 2012 | 28.94 | 20.05 | ||||||||||
September 1, 2011 to November 30, 2011 | 24.09 | 17.63 |
Period | Total Number of Shares Purchased | Average Price Paid per Share | Maximum Number of Shares That May Yet Be Purchased Under the Program | |||||||||
June 1 to June 30, 2013 | 200,000 | $ | 31.67 | 3,658,606 | ||||||||
July 1 to July 31, 2013 | 592,119 | 33.89 | 3,066,487 | |||||||||
August 1 to August 31, 2013 | 50,000 | 34.76 | 3,016,487 | |||||||||
842,119 | $ | 33.41 |
8/08 | 8/09 | 8/10 | 8/11 | 8/12 | 8/13 | |||||||||||||||||||
Actuant Corporation | $ | 100.00 | $ | 44.86 | $ | 63.08 | $ | 64.02 | $ | 89.83 | $ | 114.27 | ||||||||||||
S&P 500 | 100.00 | 81.75 | 85.76 | 101.63 | 119.92 | 142.35 | ||||||||||||||||||
Dow Jones US Diversified Industrials | 100.00 | 63.83 | 69.36 | 80.36 | 101.89 | 123.81 |
Year Ended August 31, | ||||||||||||||||||||||
2013 | 2012 | 2011 | 2010 | 2009 | ||||||||||||||||||
(in millions, except per share data) | ||||||||||||||||||||||
Statement of Earnings Data(1)(2): | ||||||||||||||||||||||
Net sales | $ | 1,280 | $ | 1,277 | $ | 1,159 | $ | 927 | $ | 876 | ||||||||||||
Gross profit | 507 | 511 | 465 | 353 | 322 | |||||||||||||||||
Selling, administrative and engineering expenses | 292 | 285 | 268 | 221 | 201 | |||||||||||||||||
Restructuring charges | 2 | — | 2 | 11 | 13 | |||||||||||||||||
Impairment charges | — | — | — | — | 26 | |||||||||||||||||
Amortization of intangible assets | 23 | 22 | 22 | 19 | 17 | |||||||||||||||||
Operating profit | 190 | 204 | 173 | 102 | 65 | |||||||||||||||||
Earnings from continuing operations | 148 | 125 | 110 | 56 | 23 | |||||||||||||||||
Diluted earnings per share from continuing operations | $ | 1.98 | $ | 1.68 | $ | 1.49 | $ | 0.78 | $ | 0.39 | ||||||||||||
Cash dividends per share declared | 0.04 | 0.04 | 0.04 | 0.04 | 0.04 | |||||||||||||||||
Diluted weighted average common shares | 74,580 | 74,940 | 75,305 | 74,209 | 66,064 | |||||||||||||||||
Balance Sheet Data (at end of period)(2): | ||||||||||||||||||||||
Total assets | $ | 2,119 | $ | 2,007 | $ | 2,063 | $ | 1,622 | $ | 1,568 | ||||||||||||
Total debt | 515 | 398 | 525 | 367 | 400 |
(1) | Results are from continuing operations and exclude the financial results of previously divested businesses (European Electrical, Acme Aerospace and BH Electronics) and discontinued operations (Electrical segment). |
(2) | We have completed various acquisitions that impact the comparability of the selected financial data. The results of operations for these acquisitions are included in our financial results for the period subsequent to their acquisition date. The following table summarizes the significant acquisitions that were completed during the last five fiscal years: |
Acquisition | Segment | Date Completed | Sales (a) | |||||||
Viking SeaTech | Energy | August 2013 | $ | 90 | ||||||
CrossControl AB | Engineered Solutions | July 2012 | 40 | |||||||
Turotest Medidores Ltda | Engineered Solutions | March 2012 | 13 | |||||||
Jeyco Pty Ltd | Energy | February 2012 | 20 | |||||||
Weasler Engineering, Inc. | Engineered Solutions | June 2011 | 85 | |||||||
Selantic | Energy | June 2010 | 10 | |||||||
Biach Industries | Energy | April 2010 | 5 | |||||||
Hydrospex | Industrial | April 2010 | 25 | |||||||
Team Hydrotec | Industrial | April 2010 | 5 | |||||||
The Cortland Companies | September 2008 | |||||||||
Cortland Cable Company | Energy | 75 | ||||||||
Sanlo, Inc. | Engineered Solutions | 25 |
Year Ended August 31, | |||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||
Statements of Earnings Data: | |||||||||||||||||||||||
Net sales | $ | 1,280 | 100 | % | $ | 1,277 | 100 | % | $ | 1,159 | 100 | % | |||||||||||
Cost of products sold | 773 | 60 | % | 765 | 60 | % | 694 | 60 | % | ||||||||||||||
Gross profit | 507 | 40 | % | 512 | 40 | % | 465 | 40 | % | ||||||||||||||
Selling, administrative and engineering expenses | 294 | 23 | % | 285 | 22 | % | 270 | 23 | % | ||||||||||||||
Amortization of intangible assets | 23 | 2 | % | 22 | 2 | % | 22 | 2 | % | ||||||||||||||
Operating profit | 190 | 15 | % | 205 | 16 | % | 173 | 15 | % | ||||||||||||||
Financing costs, net | 25 | 2 | % | 30 | 3 | % | 32 | 3 | % | ||||||||||||||
Debt refinancing costs | — | 0 | % | 17 | 1 | % | — | 0 | % | ||||||||||||||
Other expense, net | 2 | 0 | % | 3 | 0 | % | 3 | 0 | % | ||||||||||||||
Earnings from continuing operations before income tax | 163 | 13 | % | 155 | 12 | % | 138 | 12 | % | ||||||||||||||
Income tax expense | 15 | 1 | % | 30 | 2 | % | 28 | 2 | % | ||||||||||||||
Earnings from continuing operations | 148 | 12 | % | 125 | 10 | % | 110 | 10 | % | ||||||||||||||
Earnings (loss) from discontinued operations, net of income taxes | (118 | ) | (9 | )% | (38 | ) | (3 | )% | 1 | 0 | % | ||||||||||||
Net earnings | $ | 30 | 3 | % | $ | 87 | 7 | % | $ | 111 | 10 | % | |||||||||||
Other Financial Data: | |||||||||||||||||||||||
Depreciation | $ | 26 | $ | 25 | $ | 25 | |||||||||||||||||
Capital expenditures | 24 | 23 | 23 |
Year Ended August 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Net Sales | $ | 423 | $ | 419 | $ | 393 | ||||||||
Operating Profit | 118 | 115 | 98 | |||||||||||
Operating Profit % | 27.8 | % | 27.4 | % | 25.0 | % |
Year Ended August 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Net Sales | $ | 363 | $ | 349 | $ | 293 | ||||||||
Operating Profit | 63 | 62 | 49 | |||||||||||
Operating Profit % | 17.4 | % | 17.8 | % | 16.8 | % |
Year Ended August 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Net Sales | $ | 494 | $ | 508 | $ | 473 | ||||||||
Operating Profit | 40 | 61 | 64 | |||||||||||
Operating Profit % | 8.2 | % | 12.0 | % | 13.4 | % |
Year Ended August 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
Net sales | $ | 286 | $ | 329 | $ | 335 | |||||
Operating profit | 34 | 28 | 28 | ||||||||
Impairment charges | (159 | ) | (62 | ) | — | ||||||
Net loss on disposal (1) | — | — | (16 | ) | |||||||
Income tax benefit (expense) | 7 | (4 | ) | (11 | ) | ||||||
Income (loss) from discontinued operations, net of taxes | $ | (118 | ) | $ | (38 | ) | $ | 1 |
Year Ended August 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Net cash provided by operating activities | $ | 194 | $ | 182 | $ | 172 | ||||||||
Net cash used in investing activities | (253 | ) | (83 | ) | (331 | ) | ||||||||
Net cash provided by (used in) financing activities | 99 | (72 | ) | 158 | ||||||||||
Effect of exchange rate changes on cash | (4 | ) | (3 | ) | 5 | |||||||||
Net increase in cash and cash equivalents | $ | 36 | $ | 24 | $ | 4 |
August 31, 2013 | August 31, 2012 | |||||||||||||
$ | PWC % | $ | PWC % | |||||||||||
Accounts receivable, net | $ | 219 | 16 | % | $ | 235 | 15 | % | ||||||
Inventory, net | 143 | 10 | % | 212 | 13 | % | ||||||||
Accounts payable | (154 | ) | (11 | )% | (175 | ) | (11 | )% | ||||||
Net primary working capital | $ | 208 | 15 | % | $ | 272 | 17 | % |
Payments Due | ||||||||||||||||||||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | Total | ||||||||||||||||||||||
Long-term debt (principal) | $ | — | $ | 4 | $ | 9 | $ | 9 | $ | 193 | $ | 300 | $ | 515 | ||||||||||||||
Interest on long-term debt | 20 | 20 | 20 | 20 | 19 | 61 | 160 | |||||||||||||||||||||
Operating leases | 24 | 19 | 16 | 13 | 10 | 39 | 121 | |||||||||||||||||||||
Deferred acquisition purchase price | 2 | 3 | — | 1 | — | — | 6 | |||||||||||||||||||||
$ | 46 | $ | 46 | $ | 45 | $ | 43 | $ | 222 | $ | 400 | $ | 802 |
Page | |
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS | |
INDEX TO FINANCIAL STATEMENT SCHEDULE | |
Year Ended August 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Net sales | $ | 1,279,742 | $ | 1,276,521 | $ | 1,159,310 | ||||||
Cost of products sold | 772,792 | 765,061 | 694,508 | |||||||||
Gross profit | 506,950 | 511,460 | 464,802 | |||||||||
Selling, administrative and engineering expenses | 293,866 | 284,920 | 270,392 | |||||||||
Amortization of intangible assets | 22,939 | 22,026 | 21,523 | |||||||||
Operating profit | 190,145 | 204,514 | 172,887 | |||||||||
Financing costs, net | 24,837 | 29,561 | 32,119 | |||||||||
Debt refinancing costs | — | 16,830 | — | |||||||||
Other expense, net | 2,359 | 3,493 | 2,747 | |||||||||
Earnings from continuing operations before income tax | 162,949 | 154,630 | 138,021 | |||||||||
Income tax expense | 15,372 | 29,354 | 27,833 | |||||||||
Earnings from continuing operations | 147,577 | 125,276 | 110,188 | |||||||||
Earnings (loss) from discontinued operations, net of income taxes | (117,529 | ) | (37,986 | ) | 1,371 | |||||||
Net earnings | $ | 30,048 | $ | 87,290 | $ | 111,559 | ||||||
Earnings from continuing operations per share: | ||||||||||||
Basic | $ | 2.02 | $ | 1.79 | $ | 1.61 | ||||||
Diluted | $ | 1.98 | $ | 1.68 | $ | 1.49 | ||||||
Earnings per share: | ||||||||||||
Basic | $ | 0.41 | $ | 1.25 | $ | 1.63 | ||||||
Diluted | $ | 0.40 | $ | 1.17 | $ | 1.50 | ||||||
Weighted average common shares outstanding: | ||||||||||||
Basic | 72,979 | 70,099 | 68,254 | |||||||||
Diluted | 74,580 | 74,940 | 75,305 |
August 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Net earnings | $ | 30,048 | $ | 87,290 | $ | 111,559 | ||||||
Other comprehensive income (loss), net of tax | ||||||||||||
Foreign currency translation adjustments | (2,918 | ) | (48,571 | ) | 46,307 | |||||||
Pension and other postretirement benefit plans | ||||||||||||
Funded status adjustment | 3,442 | (6,358 | ) | 2,766 | ||||||||
Reclassification adjustment for losses included in net earnings | 125 | — | 2,988 | |||||||||
Amortization of actuarial losses included in net periodic pension cost | 360 | 183 | 187 | |||||||||
3,927 | (6,175 | ) | 5,941 | |||||||||
Cash flow hedges | ||||||||||||
Unrealized net loss arising during period | (140 | ) | (80 | ) | (2,822 | ) | ||||||
Reclassification adjustment for loss (gain) included in net earnings | (57 | ) | 3,033 | — | ||||||||
(197 | ) | 2,953 | (2,822 | ) | ||||||||
Total other comprehensive income (loss), net of tax | 812 | (51,793 | ) | 49,426 | ||||||||
Comprehensive income | $ | 30,860 | $ | 35,497 | $ | 160,985 |
August 31, | ||||||||
2013 | 2012 | |||||||
A S S E T S | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 103,986 | $ | 68,184 | ||||
Accounts receivable, net | 219,075 | 234,756 | ||||||
Inventories, net | 142,549 | 211,690 | ||||||
Deferred income taxes | 18,796 | 22,583 | ||||||
Prepaid expenses and other current assets | 28,228 | 24,068 | ||||||
Assets of discontinued operations | 272,606 | — | ||||||
Total current assets | 785,240 | 561,281 | ||||||
Property, plant and equipment | ||||||||
Land, buildings, and improvements | 52,669 | 49,866 | ||||||
Machinery and equipment | 305,200 | 242,718 | ||||||
Gross property, plant and equipment | 357,869 | 292,584 | ||||||
Less: Accumulated depreciation | (156,373 | ) | (176,700 | ) | ||||
Property, plant and equipment, net | 201,496 | 115,884 | ||||||
Goodwill | 734,952 | 866,412 | ||||||
Other intangibles, net | 376,692 | 445,884 | ||||||
Other long-term assets | 20,952 | 17,658 | ||||||
Total assets | $ | 2,119,332 | $ | 2,007,119 | ||||
L I A B I L I T I E S A N D S H A R E H O L D E R S’ E Q U I T Y | ||||||||
Current liabilities | ||||||||
Trade accounts payable | $ | 154,049 | $ | 174,746 | ||||
Accrued compensation and benefits | 43,800 | 58,817 | ||||||
Current maturities of debt | — | 7,500 | ||||||
Income taxes payable | 14,014 | 5,778 | ||||||
Other current liabilities | 56,899 | 72,165 | ||||||
Liabilities of discontinued operations | 53,080 | — | ||||||
Total current liabilities | 321,842 | 319,006 | ||||||
Long-term debt | 515,000 | 390,000 | ||||||
Deferred income taxes | 115,865 | 132,653 | ||||||
Pension and postretirement benefit liabilities | 20,698 | 26,442 | ||||||
Other long-term liabilities | 65,660 | 87,182 | ||||||
Shareholders’ equity | ||||||||
Class A common stock, $0.20 par value per share, authorized 168,000,000 shares, issued 77,001,144 and 75,519,079 shares, respectively | 15,399 | 15,102 | ||||||
Additional paid-in capital | 49,758 | 7,725 | ||||||
Treasury stock, at cost, 3,983,513 shares and 2,658,751 shares, respectively | (104,915 | ) | (63,083 | ) | ||||
Retained earnings | 1,188,685 | 1,161,564 | ||||||
Accumulated other comprehensive loss | (68,660 | ) | (69,472 | ) | ||||
Stock held in trust | (3,124 | ) | (2,689 | ) | ||||
Deferred compensation liability | 3,124 | 2,689 | ||||||
Total shareholders’ equity | 1,080,267 | 1,051,836 | ||||||
Total liabilities and shareholders’ equity | $ | 2,119,332 | $ | 2,007,119 |
Year Ended August 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Operating activities | ||||||||||||
Net earnings | $ | 30,048 | $ | 87,290 | $ | 111,559 | ||||||
Adjustments to reconcile net earnings to cash provided by operating activities: | ||||||||||||
Non-cash items: | ||||||||||||
Depreciation and amortization | 53,902 | 54,263 | 52,996 | |||||||||
Net loss on disposal of business | — | — | 11,695 | |||||||||
Stock-based compensation expense | 13,440 | 13,346 | 10,758 | |||||||||
Provision (benefit) for deferred income taxes | (44,265 | ) | (10,524 | ) | 6,480 | |||||||
Amortization of debt discount and debt issuance costs | 1,940 | 1,990 | 2,904 | |||||||||
Impairment charges | 158,817 | 62,464 | — | |||||||||
Non-cash debt refinancing costs | — | 2,254 | — | |||||||||
Other non-cash adjustments | 328 | — | (46 | ) | ||||||||
Changes in components of working capital and other: | ||||||||||||
Accounts receivable | (10,925 | ) | (12,310 | ) | (2,564 | ) | ||||||
Inventories | 13,714 | 11,532 | (29,909 | ) | ||||||||
Prepaid expenses and other assets | (4,603 | ) | (2,164 | ) | 5,876 | |||||||
Trade accounts payable | (9,279 | ) | 5,902 | 7,158 | ||||||||
Income taxes payable | 594 | (17,903 | ) | 4,155 | ||||||||
Accrued compensation and benefits | (14,256 | ) | (6,292 | ) | 12,178 | |||||||
Other accrued liabilities | 4,334 | (7,519 | ) | (21,674 | ) | |||||||
Cash provided by operating activities | 193,789 | 182,329 | 171,566 | |||||||||
Investing activities | ||||||||||||
Proceeds from sale of property, plant and equipment | 1,621 | 8,501 | 1,779 | |||||||||
Proceeds from sale of business | 4,854 | — | 3,463 | |||||||||
Capital expenditures | (23,668 | ) | (22,740 | ) | (23,096 | ) | ||||||
Business acquisitions, net of cash acquired | (235,489 | ) | (69,309 | ) | (313,106 | ) | ||||||
Cash used in investing activities | (252,682 | ) | (83,548 | ) | (330,960 | ) | ||||||
Financing activities | ||||||||||||
Net borrowings (repayments) on revolver | 125,000 | (58,167 | ) | 58,204 | ||||||||
Principal repayments on term loans | (7,500 | ) | (2,500 | ) | — | |||||||
Proceeds from issuance of term loans | — | — | 100,000 | |||||||||
Repurchases of 2% Convertible Notes | — | (102 | ) | (34 | ) | |||||||
Proceeds from issuance of 5.625% Senior Notes | — | 300,000 | — | |||||||||
Redemption of 6.875% Senior Notes | — | (250,000 | ) | — | ||||||||
Payment of deferred acquisition consideration | (5,378 | ) | (958 | ) | (350 | ) | ||||||
Debt issuance costs | (2,035 | ) | (5,490 | ) | (5,197 | ) | ||||||
Purchase of treasury shares | (41,832 | ) | (63,083 | ) | — | |||||||
Stock option exercises, related tax benefits and other | 33,261 | 10,913 | 8,235 | |||||||||
Cash dividend | (2,911 | ) | (2,748 | ) | (2,716 | ) | ||||||
Cash provided by (used in) financing activities | 98,605 | (72,135 | ) | 158,142 | ||||||||
Effect of exchange rate changes on cash | (3,910 | ) | (2,683 | ) | 5,251 | |||||||
Net increase in cash and cash equivalents | 35,802 | 23,963 | 3,999 | |||||||||
Cash and cash equivalents—beginning of year | 68,184 | 44,221 | 40,222 | |||||||||
Cash and cash equivalents—end of year | $ | 103,986 | $ | 68,184 | $ | 44,221 |
Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Stock Held in Trust | Deferred Compensation Liability | Total Shareholders’ Equity | ||||||||||||||||||||||||||||
Issued Shares | Amount | ||||||||||||||||||||||||||||||||||
Balance at August 31, 2010 | 68,056 | $ | 13,610 | $ | (175,157 | ) | $ | — | $ | 968,373 | $ | (67,105 | ) | $ | (1,934 | ) | $ | 1,934 | $ | 739,721 | |||||||||||||||
Net earnings | — | — | — | — | 111,559 | — | — | — | 111,559 | ||||||||||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | — | 49,426 | — | — | 49,426 | ||||||||||||||||||||||||||
Company stock contribution to employee benefit plans and other | 138 | 29 | 3,050 | — | — | — | — | — | 3,079 | ||||||||||||||||||||||||||
Restricted stock awards | (31 | ) | (7 | ) | 7 | — | — | — | — | — | — | ||||||||||||||||||||||||
Cash dividend ($0.04 per share) | — | — | — | — | (2,740 | ) | — | — | — | (2,740 | ) | ||||||||||||||||||||||||
Stock based compensation expense | — | — | 11,036 | — | — | — | — | — | 11,036 | ||||||||||||||||||||||||||
Stock option exercises | 484 | 97 | 4,227 | — | — | — | — | — | 4,324 | ||||||||||||||||||||||||||
Excess tax benefit on stock option exercises | — | — | 2,364 | — | — | — | — | — | 2,364 | ||||||||||||||||||||||||||
Stock issued to, acquired for and distributed from rabbi trust | 10 | 2 | 242 | — | — | — | (203 | ) | 203 | 244 | |||||||||||||||||||||||||
Balance at August 31, 2011 | 68,657 | 13,731 | (154,231 | ) | — | 1,077,192 | (17,679 | ) | (2,137 | ) | 2,137 | 919,013 | |||||||||||||||||||||||
Net earnings | — | — | — | — | 87,290 | — | — | — | 87,290 | ||||||||||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | — | (51,793 | ) | — | — | (51,793 | ) | ||||||||||||||||||||||||
Company stock contribution to employee benefit plans and other | 277 | 55 | 5,530 | — | — | — | — | — | 5,585 | ||||||||||||||||||||||||||
Conversion of 2% Convertible Notes | 5,962 | 1,192 | 133,757 | — | — | — | — | — | 134,949 | ||||||||||||||||||||||||||
Restricted stock awards | 17 | 3 | (3 | ) | — | — | — | — | — | — | |||||||||||||||||||||||||
Cash dividend ($0.04 per share) | — | — | — | — | (2,918 | ) | — | — | — | (2,918 | ) | ||||||||||||||||||||||||
Treasury stock repurchases | — | — | — | (63,083 | ) | — | — | — | — | (63,083 | ) | ||||||||||||||||||||||||
Stock based compensation expense | — | — | 13,346 | — | — | — | — | — | 13,346 | ||||||||||||||||||||||||||
Stock option exercises | 580 | 116 | 6,434 | — | — | — | — | — | 6,550 | ||||||||||||||||||||||||||
Excess tax benefit on stock option exercises | — | — | 2,349 | — | — | — | — | — | 2,349 | ||||||||||||||||||||||||||
Stock issued to, acquired for and distributed from rabbi trust | 26 | 5 | 543 | — | — | — | (552 | ) | 552 | 548 | |||||||||||||||||||||||||
Balance at August 31, 2012 | 75,519 | 15,102 | 7,725 | (63,083 | ) | 1,161,564 | (69,472 | ) | (2,689 | ) | 2,689 | 1,051,836 | |||||||||||||||||||||||
Net earnings | — | — | — | — | 30,048 | — | — | — | 30,048 | ||||||||||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | — | 812 | — | — | 812 | ||||||||||||||||||||||||||
Company stock contribution to employee benefit plans and other | 21 | 5 | 592 | — | — | — | — | — | 597 | ||||||||||||||||||||||||||
Restricted stock awards | 169 | 34 | (34 | ) | — | — | — | — | — | — | |||||||||||||||||||||||||
Cash dividend ($0.04 per share) | — | — | — | — | (2,927 | ) | — | — | — | (2,927 | ) | ||||||||||||||||||||||||
Treasury stock repurchases | — | — | — | (41,832 | ) | — | — | — | — | (41,832 | ) | ||||||||||||||||||||||||
Stock based compensation expense | — | — | 13,440 | — | — | — | — | — | 13,440 | ||||||||||||||||||||||||||
Stock option exercises | 1,276 | 255 | 24,585 | — | — | — | — | — | 24,840 | ||||||||||||||||||||||||||
Excess tax benefit on stock option exercises | — | — | 2,954 | — | — | — | — | — | 2,954 | ||||||||||||||||||||||||||
Stock issued to, acquired for and distributed from rabbi trust | 16 | 3 | 496 | — | — | — | (435 | ) | 435 | 499 | |||||||||||||||||||||||||
Balance at August 31, 2013 | 77,001 | $ | 15,399 | $ | 49,758 | $ | (104,915 | ) | $ | 1,188,685 | $ | (68,660 | ) | $ | (3,124 | ) | $ | 3,124 | $ | 1,080,267 |
2013 | 2012 | |||||||||
Beginning balance | $ | 12,869 | $ | 23,707 | ||||||
Warranty reserves of acquired businesses | 981 | 338 | ||||||||
Purchase accounting adjustments | — | (7,726 | ) | |||||||
Provision for warranties | 7,907 | 9,219 | ||||||||
Warranty payments and costs incurred | (11,616 | ) | (10,893 | ) | ||||||
Discontinued operations reclassification | (3,107 | ) | — | |||||||
Impact of changes in foreign currency rates | 379 | (1,776 | ) | |||||||
Ending balance | $ | 7,413 | $ | 12,869 |
Total | |||||
Accounts receivable, net | $ | 17,225 | |||
Inventories | 1,582 | ||||
Property, plant & equipment | 99,776 | ||||
Goodwill | 87,734 | ||||
Other intangible assets | 65,360 | ||||
Other assets | 1,755 | ||||
Trade accounts payable | (7,664 | ) | |||
Deferred income taxes | (25,923 | ) | |||
Other liabilities | (4,439 | ) | |||
Cash paid, net of cash acquired | $ | 235,406 |
Year Ended August 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Net sales | ||||||||||||||
As reported | $ | 1,279,742 | $ | 1,276,521 | $ | 1,159,310 | ||||||||
Pro forma | 1,365,115 | 1,419,173 | 1,393,061 | |||||||||||
Earnings from continuing operations | ||||||||||||||
As reported | $ | 147,577 | $ | 125,276 | $ | 110,188 | ||||||||
Pro forma | 153,946 | 134,581 | 125,785 | |||||||||||
Basic earnings per share from continuing operations | ||||||||||||||
As reported | $ | 2.02 | $ | 1.79 | $ | 1.61 | ||||||||
Pro forma | 2.11 | 1.92 | 1.84 | |||||||||||
Diluted earnings per share from continuing operations | ||||||||||||||
As reported | $ | 1.98 | $ | 1.68 | $ | 1.49 | ||||||||
Pro forma | 2.06 | 1.81 | 1.69 |
Year Ended August 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Net sales | $ | 286,308 | $ | 328,821 | $ | 335,318 | ||||||
Operating profit | 34,536 | 28,148 | 20,029 | |||||||||
Impairment charge | (159,104 | ) | (62,464 | ) | — | |||||||
Net loss on disposal (1) | — | — | (15,829 | ) | ||||||||
Income tax benefit (expense) | 7,039 | (3,670 | ) | (2,829 | ) | |||||||
Income (loss) from discontinued operations, net of taxes | $ | (117,529 | ) | $ | (37,986 | ) | $ | 1,371 |
Accounts receivable, net | $ | 41,247 | ||
Inventories, net | 55,142 | |||
Property, plant & equipment, net | 9,545 | |||
Goodwill | 76,877 | |||
Other intangible assets, net | 84,387 | |||
Other assets | 5,408 | |||
Assets of discontinued operations | $ | 272,606 | ||
Trade accounts payable | $ | 19,824 | ||
Other current liabilities | 12,984 | |||
Deferred income taxes | 9,376 | |||
Other long-term liabilities | 10,896 | |||
Liabilities of discontinued operations | $ | 53,080 |
Industrial | Energy | Electrical | Engineered Solutions | Total | ||||||||||||||||
Balance as of August 31, 2011 | $ | 85,409 | $ | 252,285 | $ | 260,777 | $ | 289,995 | $ | 888,466 | ||||||||||
Businesses acquired | — | 14,101 | — | 26,188 | 40,289 | |||||||||||||||
Purchase accounting adjustments | — | — | (3,995 | ) | 715 | (3,280 | ) | |||||||||||||
Impairment charge | — | — | (36,557 | ) | — | (36,557 | ) | |||||||||||||
Impact of changes in foreign currency rates | (4,005 | ) | (6,865 | ) | (6,355 | ) | (5,281 | ) | (22,506 | ) | ||||||||||
Balance as of August 31, 2012 | 81,404 | 259,521 | 213,870 | 311,617 | 866,412 | |||||||||||||||
Business acquired | — | 87,734 | — | — | 87,734 | |||||||||||||||
Purchase accounting adjustments | — | 117 | — | (100 | ) | 17 | ||||||||||||||
Impairment charge | — | — | (137,804 | ) | — | (137,804 | ) | |||||||||||||
Reclassification to discontinued operations | — | — | (76,877 | ) | — | (76,877 | ) | |||||||||||||
Divestiture of Nielsen Sessions business | — | — | — | (2,556 | ) | (2,556 | ) | |||||||||||||
Impact of changes in foreign currency rates | 1,207 | (5,469 | ) | 811 | 1,477 | (1,974 | ) | |||||||||||||
Balance as of August 31, 2013 | $ | 82,611 | $ | 341,903 | $ | — | $ | 310,438 | $ | 734,952 |
Weighted Average Amortization Period (Years) | August 31, 2013 | August 31, 2012 | ||||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Book Value | Gross Carrying Amount | Accumulated Amortization | Net Book Value | |||||||||||||||||||||
Amortizable intangible assets: | ||||||||||||||||||||||||||
Customer relationships | 15 | $ | 318,143 | $ | 95,215 | $ | 222,928 | $ | 347,739 | $ | 93,768 | $ | 253,971 | |||||||||||||
Patents | 11 | 30,564 | 18,747 | 11,817 | 52,851 | 34,842 | 18,009 | |||||||||||||||||||
Trademarks and tradenames | 19 | 24,088 | 7,356 | 16,732 | 43,820 | 8,670 | 35,150 | |||||||||||||||||||
Non-compete agreements and other | 4 | 7,034 | 6,458 | 576 | 7,677 | 6,316 | 1,361 | |||||||||||||||||||
Indefinite lived intangible assets: | ||||||||||||||||||||||||||
Tradenames | N/A | 124,639 | — | 124,639 | 137,393 | — | 137,393 | |||||||||||||||||||
$ | 504,468 | $ | 127,776 | $ | 376,692 | $ | 589,480 | $ | 143,596 | $ | 445,884 |
August 31, | ||||||||||
2013 | 2012 | |||||||||
Senior Credit Facility | ||||||||||
Revolver | $ | 125,000 | $ | — | ||||||
Term Loan | 90,000 | 97,500 | ||||||||
215,000 | 97,500 | |||||||||
5.625% Senior Notes | 300,000 | 300,000 | ||||||||
Total Senior Indebtedness | 515,000 | 397,500 | ||||||||
Less: current maturities of long-term debt | — | (7,500 | ) | |||||||
Total long-term debt, less current maturities | $ | 515,000 | $ | 390,000 |
August 31, | ||||||||||
2013 | 2012 | |||||||||
Level 1 Valuation: | ||||||||||
Cash equivalents | $ | 1,092 | $ | 5,154 | ||||||
Investments | 1,793 | 1,602 | ||||||||
Level 2 Valuation: | ||||||||||
Foreign currency forward contracts | $ | 143 | $ | 945 |
2013 | 2012 | |||||||
Reconciliation of benefit obligations: | ||||||||
Benefit obligation at beginning of year | $ | 50,870 | $ | 44,430 | ||||
Adjustment | (280 | ) | — | |||||
Interest cost | 1,928 | 2,162 | ||||||
Actuarial (gain) loss | (4,983 | ) | 6,855 | |||||
Benefits paid | (2,489 | ) | (2,577 | ) | ||||
Benefit obligation at end of year | $ | 45,046 | $ | 50,870 | ||||
Reconciliation of plan assets: | ||||||||
Fair value of plan assets at beginning of year | $ | 33,695 | $ | 32,412 | ||||
Actual return on plan assets | 2,252 | 2,911 | ||||||
Company contributions | 596 | 949 | ||||||
Benefits paid from plan assets | (2,489 | ) | (2,577 | ) | ||||
Fair value of plan assets at end of year | 34,054 | 33,695 | ||||||
Funded status of the plans (underfunded) | $ | (10,992 | ) | $ | (17,175 | ) |
Year ended August 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Interest cost | $ | 1,928 | $ | 2,162 | $ | 2,108 | ||||||
Expected return on assets | (2,468 | ) | (2,471 | ) | (2,221 | ) | ||||||
Amortization of actuarial loss | 878 | 675 | 669 | |||||||||
Net benefit cost | $ | 338 | $ | 366 | $ | 556 |
2013 | 2012 | 2011 | |||||||||
Assumptions for benefit obligations: | |||||||||||
Discount rate | 4.90 | % | 3.90 | % | 5.00 | % | |||||
Assumptions for net periodic benefit cost: | |||||||||||
Discount rate | 3.90 | % | 5.00 | % | 4.60 | % | |||||
Expected return on plan assets | 7.75 | % | 7.90 | % | 8.00 | % |
Year Ended August 31, | ||||||||||||||
2013 | % | 2012 | % | |||||||||||
Cash and cash equivalents | $ | 348 | 1.0 | % | $ | 250 | 0.7 | % | ||||||
Fixed income securities: | ||||||||||||||
Government bonds | — | — | 310 | 0.9 | ||||||||||
Corporate bonds | 8,741 | 25.7 | 7,489 | 22.2 | ||||||||||
Mutual funds | 3,464 | 10.2 | 2,678 | 8.0 | ||||||||||
12,205 | 35.9 | 10,477 | 31.1 | |||||||||||
Equity securities: | ||||||||||||||
Mutual funds | 21,501 | 63.1 | 22,968 | 68.2 | ||||||||||
Total plan assets | $ | 34,054 | 100.0 | % | $ | 33,695 | 100.0 | % |
August 31, | ||||||||||
2013 | 2012 | |||||||||
Benefit obligation | $ | 12,912 | $ | 12,227 | ||||||
Fair value of plan assets | 7,790 | 7,440 | ||||||||
Funded status of plans (underfunded) | $ | (5,122 | ) | $ | (4,787 | ) |
Year ended August 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Currently payable: | ||||||||||||||
Federal | $ | 24,809 | $ | 22,078 | $ | (78 | ) | |||||||
Foreign | 13,335 | 10,396 | 20,903 | |||||||||||
State | 902 | 1,534 | 586 | |||||||||||
39,046 | 34,008 | 21,411 | ||||||||||||
Deferred: | ||||||||||||||
Federal | (13,514 | ) | (495 | ) | 14,948 | |||||||||
Foreign | (9,942 | ) | (4,598 | ) | (4,223 | ) | ||||||||
State | (218 | ) | 439 | (4,303 | ) | |||||||||
(23,674 | ) | (4,654 | ) | 6,422 | ||||||||||
$ | 15,372 | $ | 29,354 | $ | 27,833 |
Year ended August 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
Federal statutory rate | 35.0 | % | 35.0 | % | 35.0 | % | |||||
State income taxes, net of Federal effect | 0.9 | 1.2 | 0.4 | ||||||||
Net effect of foreign tax rates and credits | (8.8 | ) | (14.6 | ) | (14.0 | ) | |||||
NOL utilization and changes in valuation allowance | (3.1 | ) | 0.1 | (3.0 | ) | ||||||
Tax contingency reserve | (5.6 | ) | (2.2 | ) | (1.6 | ) | |||||
Prior period correction (1) | (6.5 | ) | — | — | |||||||
Other items | (2.5 | ) | (0.5 | ) | 3.4 | ||||||
Effective income tax rate | 9.4 | % | 19.0 | % | 20.2 | % |
August 31, | ||||||||||
2013 | 2012 | |||||||||
Deferred income tax assets: | ||||||||||
Operating loss and tax credit carryforwards | $ | 35,071 | $ | 16,393 | ||||||
Compensation related liabilities | 20,812 | 9,909 | ||||||||
Postretirement benefits | 7,731 | 10,679 | ||||||||
Inventory reserves | 7,049 | 8,045 | ||||||||
Book reserves and other items | 11,523 | 12,781 | ||||||||
Total deferred income tax assets | 82,186 | 57,807 | ||||||||
Valuation allowance | (22,777 | ) | (8,153 | ) | ||||||
Net deferred income tax assets | 59,409 | 49,654 | ||||||||
Deferred income tax liabilities: | ||||||||||
Depreciation and amortization | (129,498 | ) | (156,751 | ) | ||||||
Other items | (1,985 | ) | (2,098 | ) | ||||||
Deferred income tax liabilities | (131,483 | ) | (158,849 | ) | ||||||
Net deferred income tax liability | $ | (72,074 | ) | $ | (109,195 | ) |
2013 | 2012 | 2011 | ||||||||||||
Beginning balance | $ | 24,608 | $ | 26,179 | $ | 28,225 | ||||||||
Increase for tax positions taken in a prior period | 3,601 | 3,400 | 4,026 | |||||||||||
Decrease for tax positions taken in a prior period | (7,622 | ) | (4,579 | ) | (6,072 | ) | ||||||||
Decrease due to settlements | (2,581 | ) | (392 | ) | — | |||||||||
Ending balance | $ | 18,006 | $ | 24,608 | $ | 26,179 |
Year Ended August 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Domestic | $ | 67,392 | $ | 65,685 | $ | 47,445 | ||||||||
Foreign | 95,557 | 88,945 | 90,576 | |||||||||||
$ | 162,949 | $ | 154,630 | $ | 138,021 |
Year Ended August 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Numerator: | ||||||||||||
Net earnings | $ | 30,048 | $ | 87,290 | $ | 111,559 | ||||||
Plus: 2% Convertible Notes financings costs, net of taxes | — | 425 | 1,755 | |||||||||
Net earnings for diluted earnings per share | $ | 30,048 | $ | 87,715 | $ | 113,314 | ||||||
Denominator: | ||||||||||||
Weighted average common shares outstanding for basic earnings per share | 72,979 | 70,099 | 68,254 | |||||||||
Net effect of dilutive securities—employee stock compensation plans | 1,601 | 1,119 | 1,089 | |||||||||
Net effect of 2% Convertible Notes based on the if-converted method | — | 3,722 | 5,962 | |||||||||
Weighted average common shares outstanding for diluted earnings per share | 74,580 | 74,940 | 75,305 | |||||||||
Basic Earnings Per Share: | $ | 0.41 | $ | 1.25 | $ | 1.63 | ||||||
Diluted Earnings Per Share: | $ | 0.40 | $ | 1.17 | $ | 1.50 |
Shares | Weighted-Average Exercise Price (Per Share) | Weighted-Average Remaining Contractual Term | Aggregate Intrinsic Value | ||||||||||
Outstanding on September 1, 2012 | 5,289,384 | $ | 22.33 | ||||||||||
Granted | 276,136 | 28.70 | |||||||||||
Exercised | (1,278,626 | ) | 19.48 | ||||||||||
Forfeited | (107,343 | ) | 22.10 | ||||||||||
Outstanding on August 31, 2013 | 4,179,551 | $ | 23.66 | 5.3 | $ | 48.8 | million | ||||||
Exercisable on August 31, 2013 | 2,609,876 | $ | 23.92 | 4.2 | $ | 30.8 | million |
Year Ended August 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Weighted-average fair value of options granted (per share) | $ | 10.49 | $ | 8.73 | $ | 10.74 | ||||||||
Intrinsic value of options exercised | 15,803 | 7,946 | 7,540 | |||||||||||
Cash receipts from exercise of options | 24,840 | 6,550 | 4,324 |
Number of Shares | Weighted-Average Fair Value at Grant Date (Per Share) | ||||||
Outstanding August 31, 2012 | 1,507,443 | $23.85 | |||||
Granted | 430,793 | 29.18 | |||||
Forfeited | (131,688 | ) | 22.76 | ||||
Vested | (212,359 | ) | 20.46 | ||||
Outstanding August 31, 2013 | 1,594,189 | 25.83 |
Fiscal Year Ended August 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
Dividend yield | 0.14 | % | 0.18 | % | 0.15 | % | |||||
Expected volatility | 38.36 | % | 39.97 | % | 39.62 | % | |||||
Risk-free rate of return | 0.84 | % | 1.19 | % | 2.53 | % | |||||
Expected forfeiture rate | 15 | % | 15 | % | 15 | % | |||||
Expected life | 6.1 years | 6.1 years | 6.1 years |
Year Ended August 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Net Sales by Segment: | ||||||||||||
Industrial | $ | 422,620 | $ | 419,295 | $ | 393,013 | ||||||
Energy | 363,372 | 349,163 | 293,060 | |||||||||
Engineered Solutions | 493,750 | 508,063 | 473,237 | |||||||||
$ | 1,279,742 | $ | 1,276,521 | $ | 1,159,310 | |||||||
Net Sales by Reportable Product Line: | ||||||||||||
Industrial | $ | 422,620 | $ | 419,295 | $ | 393,013 | ||||||
Energy | 363,372 | 349,163 | 293,060 | |||||||||
Vehicle Systems | 253,073 | 279,549 | 328,763 | |||||||||
Other | 240,677 | 228,514 | 144,474 | |||||||||
$ | 1,279,742 | $ | 1,276,521 | $ | 1,159,310 | |||||||
Operating Profit (Loss): | ||||||||||||
Industrial | $ | 117,644 | $ | 114,777 | $ | 98,415 | ||||||
Energy | 63,280 | 62,205 | 49,345 | |||||||||
Engineered Solutions | 40,328 | 60,851 | 63,612 | |||||||||
General Corporate | (31,107 | ) | (33,319 | ) | (38,485 | ) | ||||||
$ | 190,145 | $ | 204,514 | $ | 172,887 | |||||||
Depreciation and Amortization: | ||||||||||||
Industrial | $ | 8,553 | $ | 8,358 | $ | 8,655 | ||||||
Energy | 18,451 | 18,115 | 18,152 | |||||||||
Engineered Solutions | 16,949 | 15,093 | 13,916 | |||||||||
General Corporate | 2,145 | 2,030 | 2,579 | |||||||||
Discontinued Operations | 7,804 | 10,667 | 9,694 | |||||||||
$ | 53,902 | $ | 54,263 | $ | 52,996 | |||||||
Capital Expenditures: | ||||||||||||
Industrial | $ | 3,524 | $ | 5,333 | $ | 3,590 | ||||||
Energy | 9,417 | 8,962 | 8,978 | |||||||||
Engineered Solutions | 7,001 | 3,463 | 5,966 | |||||||||
General Corporate | 867 | 1,905 | 1,902 | |||||||||
Discontinued Operations | 2,859 | 3,077 | 2,660 | |||||||||
$ | 23,668 | $ | 22,740 | $ | 23,096 |
August 31, | ||||||||
2013 | 2012 | |||||||
Assets: | ||||||||
Industrial | $ | 280,110 | $ | 268,735 | ||||
Energy | 817,547 | 540,409 | ||||||
Electrical | — | 437,914 | ||||||
Engineered Solutions | 652,581 | 667,550 | ||||||
General Corporate | 96,488 | 92,511 | ||||||
Assets of discontinued operations | 272,606 | — | ||||||
$ | 2,119,332 | $ | 2,007,119 |
Year Ended August 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Net Sales: | ||||||||||||||
United States | $ | 549,057 | $ | 599,831 | $ | 479,070 | ||||||||
Netherlands | 159,396 | 185,112 | 207,787 | |||||||||||
United Kingdom | 144,131 | 141,037 | 116,935 | |||||||||||
Australia | 68,255 | 47,472 | 27,854 | |||||||||||
France | 52,806 | 48,681 | 49,971 | |||||||||||
All other | 306,097 | 254,388 | 277,693 | |||||||||||
$ | 1,279,742 | $ | 1,276,521 | $ | 1,159,310 | |||||||||
August 31, | ||||||||||||||
2013 | 2012 | |||||||||||||
Long-lived Assets: | ||||||||||||||
Norway | $ | 59,557 | $ | 941 | ||||||||||
United Kingdom | 54,136 | 17,672 | ||||||||||||
United States | 41,161 | 50,950 | ||||||||||||
China | 19,551 | 20,166 | ||||||||||||
Netherlands | 10,418 | 12,166 | ||||||||||||
All other | 20,358 | 17,725 | ||||||||||||
$ | 205,181 | $ | 119,620 |
Year Ended August 31, 2013 | ||||||||||||||||||||
Parent | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||
Net sales | $ | 196,531 | $ | 293,884 | $ | 789,327 | $ | — | $ | 1,279,742 | ||||||||||
Cost of products sold | 65,178 | 201,704 | 505,910 | — | 772,792 | |||||||||||||||
Gross profit | 131,353 | 92,180 | 283,417 | — | 506,950 | |||||||||||||||
Selling, administrative and engineering expenses | 69,734 | 59,358 | 164,774 | — | 293,866 | |||||||||||||||
Amortization of intangible assets | 1,276 | 10,481 | 11,182 | — | 22,939 | |||||||||||||||
Operating profit | 60,343 | 22,341 | 107,461 | — | 190,145 | |||||||||||||||
Financing costs, net | 25,270 | 9 | (442 | ) | — | 24,837 | ||||||||||||||
Intercompany expense (income), net | (21,041 | ) | 1,082 | 19,959 | — | — | ||||||||||||||
Other expense (income), net | (2,105 | ) | (571 | ) | 5,035 | — | 2,359 | |||||||||||||
Earnings from continuing operations before income tax expense | 58,219 | 21,821 | 82,909 | — | 162,949 | |||||||||||||||
Income tax expense (benefit) | (798 | ) | 2,009 | 14,161 | — | 15,372 | ||||||||||||||
Net earnings before equity in earnings (loss) of subsidiaries | 59,017 | 19,812 | 68,748 | — | 147,577 | |||||||||||||||
Equity in earnings (loss) of subsidiaries | (26,527 | ) | 7,822 | 2,173 | 16,532 | — | ||||||||||||||
Earnings from continuing operations | 32,490 | 27,634 | 70,921 | 16,532 | 147,577 | |||||||||||||||
Loss from discontinued operations | (2,442 | ) | (76,634 | ) | (38,453 | ) | — | (117,529 | ) | |||||||||||
Net earnings (loss) | $ | 30,048 | $ | (49,000 | ) | $ | 32,468 | $ | 16,532 | $ | 30,048 | |||||||||
Comprehensive income (loss) | $ | 30,860 | $ | (48,416 | ) | $ | 31,099 | $ | 17,317 | $ | 30,860 |
Year Ended August 31, 2012 | ||||||||||||||||||||
Parent | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||
Net sales | $ | 206,894 | $ | 328,295 | $ | 741,332 | $ | — | $ | 1,276,521 | ||||||||||
Cost of products sold | 69,902 | 220,271 | 474,888 | — | 765,061 | |||||||||||||||
Gross profit | 136,992 | 108,024 | 266,444 | — | 511,460 | |||||||||||||||
Selling, administrative and engineering expenses | 79,742 | 61,113 | 144,065 | — | 284,920 | |||||||||||||||
Amortization of intangible assets | 1,341 | 10,515 | 10,170 | — | 22,026 | |||||||||||||||
Operating profit | 55,909 | 36,396 | 112,209 | — | 204,514 | |||||||||||||||
Financing costs, net | 29,983 | (14 | ) | (408 | ) | — | 29,561 | |||||||||||||
Debt refinancing costs | 16,830 | — | — | — | 16,830 | |||||||||||||||
Intercompany expense (income), net | (32,185 | ) | 6,281 | 25,904 | — | — | ||||||||||||||
Other expense, net | 1,351 | 1,992 | 150 | — | 3,493 | |||||||||||||||
Earnings from continuing operations before income tax expense | 39,930 | 28,137 | 86,563 | — | 154,630 | |||||||||||||||
Income tax expense | 6,700 | 4,677 | 17,977 | — | 29,354 | |||||||||||||||
Net earnings before equity in earnings of subsidiaries | 33,230 | 23,460 | 68,586 | — | 125,276 | |||||||||||||||
Equity in earnings of subsidiaries | 56,407 | 14,373 | 1,649 | (72,429 | ) | — | ||||||||||||||
Earnings from continuing operations | 89,637 | 37,833 | 70,235 | (72,429 | ) | 125,276 | ||||||||||||||
(Loss) earnings from discontinued operations | (2,347 | ) | 11,373 | (47,012 | ) | — | (37,986 | ) | ||||||||||||
Net earnings | $ | 87,290 | $ | 49,206 | $ | 23,223 | $ | (72,429 | ) | $ | 87,290 | |||||||||
Comprehensive income | $ | 35,497 | $ | 24,934 | $ | 6,064 | $ | (30,998 | ) | $ | 35,497 |
Year Ended August 31, 2011 | ||||||||||||||||||||
Parent | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||
Net sales | $ | 170,094 | $ | 302,911 | $ | 686,305 | $ | — | $ | 1,159,310 | ||||||||||
Cost of products sold | 55,256 | 200,332 | 438,920 | — | 694,508 | |||||||||||||||
Gross profit | 114,838 | 102,579 | 247,385 | — | 464,802 | |||||||||||||||
Selling, administrative and engineering expenses | 87,333 | 57,288 | 125,771 | — | 270,392 | |||||||||||||||
Amortization of intangible assets | 335 | 12,060 | 9,128 | — | 21,523 | |||||||||||||||
Operating profit | 27,170 | 33,231 | 112,486 | — | 172,887 | |||||||||||||||
Financing costs, net | 31,912 | (1 | ) | 208 | — | 32,119 | ||||||||||||||
Intercompany expense (income), net | (16,924 | ) | 14,670 | 2,254 | — | — | ||||||||||||||
Other expense (income), net | (4,519 | ) | 112 | 7,154 | — | 2,747 | ||||||||||||||
Earnings from continuing operations before income tax expense | 16,701 | 18,450 | 102,870 | — | 138,021 | |||||||||||||||
Income tax expense | 4,148 | 2,680 | 21,005 | — | 27,833 | |||||||||||||||
Net earnings before equity in earnings of subsidiaries | 12,553 | 15,770 | 81,865 | — | 110,188 | |||||||||||||||
Equity in earnings of subsidiaries | 112,364 | 77,395 | 6,261 | (196,020 | ) | — | ||||||||||||||
Earnings from continuing operations | 124,917 | 93,165 | 88,126 | (196,020 | ) | 110,188 | ||||||||||||||
(Loss) earnings from discontinuing operations | (13,358 | ) | 8,881 | 5,848 | — | 1,371 | ||||||||||||||
Net earnings | $ | 111,559 | $ | 102,046 | $ | 93,974 | $ | (196,020 | ) | $ | 111,559 | |||||||||
Comprehensive income | $ | 160,985 | $ | 130,503 | $ | 106,875 | $ | (237,378 | ) | $ | 160,985 |
August 31, 2013 | ||||||||||||||||||||
Parent | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||
ASSETS | ||||||||||||||||||||
Cash and cash equivalents | $ | 16,122 | $ | — | $ | 87,864 | $ | — | $ | 103,986 | ||||||||||
Accounts receivable, net | 20,471 | 40,343 | 158,261 | — | 219,075 | |||||||||||||||
Inventories, net | 27,343 | 38,948 | 76,258 | — | 142,549 | |||||||||||||||
Deferred income taxes | 13,002 | — | 5,794 | — | 18,796 | |||||||||||||||
Prepaid expenses and other current assets | 7,454 | 963 | 19,811 | — | 28,228 | |||||||||||||||
Assets of discontinued operations | — | 192,129 | 80,477 | — | 272,606 | |||||||||||||||
Total current assets | 84,392 | 272,383 | 428,465 | — | 785,240 | |||||||||||||||
Property, plant & equipment, net | 7,050 | 22,801 | 171,645 | — | 201,496 | |||||||||||||||
Goodwill | 62,543 | 264,502 | 407,907 | — | 734,952 | |||||||||||||||
Other intangibles, net | 13,247 | 141,258 | 222,187 | — | 376,692 | |||||||||||||||
Intercompany receivable | — | 480,633 | 360,620 | (841,253 | ) | — | ||||||||||||||
Investment in subsidiaries | 2,086,534 | 201,779 | 96,333 | (2,384,646 | ) | — | ||||||||||||||
Other long-term assets | 12,654 | 22 | 8,276 | — | 20,952 | |||||||||||||||
Total assets | $ | 2,266,420 | $ | 1,383,378 | $ | 1,695,433 | $ | (3,225,899 | ) | $ | 2,119,332 | |||||||||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||||||||||||||||||
Trade accounts payable | $ | 22,194 | $ | 30,637 | $ | 101,218 | $ | — | $ | 154,049 | ||||||||||
Accrued compensation and benefits | 13,835 | 2,716 | 27,249 | — | 43,800 | |||||||||||||||
Income taxes payable | 8,135 | — | 5,879 | — | 14,014 | |||||||||||||||
Other current liabilities | 21,268 | 4,630 | 31,001 | — | 56,899 | |||||||||||||||
Liabilities of discontinued operations | — | 23,466 | 29,614 | — | 53,080 | |||||||||||||||
Total current liabilities | 65,432 | 61,449 | 194,961 | — | 321,842 | |||||||||||||||
Long-term debt | 515,000 | — | — | — | 515,000 | |||||||||||||||
Deferred income taxes | 64,358 | — | 51,507 | — | 115,865 | |||||||||||||||
Pension and post-retirement benefit liabilities | 16,267 | — | 4,431 | — | 20,698 | |||||||||||||||
Other long-term liabilities | 51,479 | 390 | 13,791 | — | 65,660 | |||||||||||||||
Intercompany payable | 473,617 | — | 367,636 | (841,253 | ) | — | ||||||||||||||
Shareholders’ equity | 1,080,267 | 1,321,539 | 1,063,107 | (2,384,646 | ) | 1,080,267 | ||||||||||||||
Total liabilities and shareholders’ equity | $ | 2,266,420 | $ | 1,383,378 | $ | 1,695,433 | $ | (3,225,899 | ) | $ | 2,119,332 |
August 31, 2012 | ||||||||||||||||||||
Parent | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||
ASSETS | ||||||||||||||||||||
Cash and cash equivalents | $ | 12,401 | $ | 91 | $ | 55,692 | $ | — | $ | 68,184 | ||||||||||
Accounts receivable, net | 20,401 | 74,006 | 140,349 | — | 234,756 | |||||||||||||||
Inventories, net | 29,658 | 75,905 | 106,127 | — | 211,690 | |||||||||||||||
Deferred income taxes | 17,942 | — | 4,641 | — | 22,583 | |||||||||||||||
Prepaid expenses and other current assets | 8,157 | 1,166 | 14,745 | — | 24,068 | |||||||||||||||
Total current assets | 88,559 | 151,168 | 321,554 | — | 561,281 | |||||||||||||||
Property, plant & equipment, net | 6,944 | 31,818 | 77,122 | — | 115,884 | |||||||||||||||
Goodwill | 62,543 | 433,193 | 370,676 | — | 866,412 | |||||||||||||||
Other intangibles, net | 14,522 | 206,194 | 225,168 | — | 445,884 | |||||||||||||||
Intercompany receivable | — | 418,253 | 307,282 | (725,535 | ) | — | ||||||||||||||
Investment in subsidiaries | 1,886,478 | 250,738 | 90,770 | (2,227,986 | ) | — | ||||||||||||||
Other long-term assets | 12,297 | 22 | 5,339 | — | 17,658 | |||||||||||||||
Total assets | $ | 2,071,343 | $ | 1,491,386 | $ | 1,397,911 | $ | (2,953,521 | ) | $ | 2,007,119 | |||||||||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||||||||||||||||||
Trade accounts payable | $ | 21,722 | $ | 44,893 | $ | 108,131 | $ | — | $ | 174,746 | ||||||||||
Accrued compensation and benefits | 23,459 | 6,646 | 28,712 | — | 58,817 | |||||||||||||||
Income taxes payable | 3,129 | — | 2,649 | — | 5,778 | |||||||||||||||
Current maturities of debt | 7,500 | — | — | — | 7,500 | |||||||||||||||
Other current liabilities | 20,876 | 11,566 | 39,723 | — | 72,165 | |||||||||||||||
Total current liabilities | 76,686 | 63,105 | 179,215 | — | 319,006 | |||||||||||||||
Long-term debt | 390,000 | — | — | — | 390,000 | |||||||||||||||
Deferred income taxes | 91,604 | — | 41,049 | — | 132,653 | |||||||||||||||
Pension and post-retirement benefit liabilities | 22,500 | — | 3,942 | — | 26,442 | |||||||||||||||
Other long-term liabilities | 59,929 | 620 | 26,633 | — | 87,182 | |||||||||||||||
Intercompany payable | 378,788 | — | 346,747 | (725,535 | ) | — | ||||||||||||||
Shareholders’ equity | 1,051,836 | 1,427,661 | 800,325 | (2,227,986 | ) | 1,051,836 | ||||||||||||||
Total liabilities and shareholders’ equity | $ | 2,071,343 | $ | 1,491,386 | $ | 1,397,911 | $ | (2,953,521 | ) | $ | 2,007,119 |
Year Ended August 31, 2013 | ||||||||||||||||||||
Parent | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||
Operating Activities | ||||||||||||||||||||
Net cash provided by operating activities | $ | 81,597 | $ | 26,095 | $ | 86,097 | $ | — | $ | 193,789 | ||||||||||
Investing Activities | ||||||||||||||||||||
Proceeds from sale of property, plant & equipment | 563 | 206 | 852 | — | 1,621 | |||||||||||||||
Proceeds from sale of business | — | — | 4,854 | — | 4,854 | |||||||||||||||
Capital expenditures | (2,022 | ) | (4,021 | ) | (17,625 | ) | — | (23,668 | ) | |||||||||||
Business acquisitions, net of cash acquired | — | — | (235,489 | ) | — | (235,489 | ) | |||||||||||||
Cash used in investing activities | (1,459 | ) | (3,815 | ) | (247,408 | ) | — | (252,682 | ) | |||||||||||
Financing Activities | ||||||||||||||||||||
Net borrowings on revolving credit facilities | 125,000 | — | — | — | 125,000 | |||||||||||||||
Intercompany loan activity | (179,050 | ) | (22,371 | ) | 201,421 | — | — | |||||||||||||
Principal repayment on term loans | (7,500 | ) | — | — | — | (7,500 | ) | |||||||||||||
Payment of deferred acquisition consideration | (1,350 | ) | — | (4,028 | ) | — | (5,378 | ) | ||||||||||||
Debt issuance costs | (2,035 | ) | — | — | — | (2,035 | ) | |||||||||||||
Purchase of treasury shares | (41,832 | ) | — | — | — | (41,832 | ) | |||||||||||||
Stock option exercises and related tax benefits | 33,261 | — | — | — | 33,261 | |||||||||||||||
Cash dividend | (2,911 | ) | — | — | — | (2,911 | ) | |||||||||||||
Cash provided (used in) financing activities | (76,417 | ) | (22,371 | ) | 197,393 | — | 98,605 | |||||||||||||
Effect of exchange rate changes on cash | — | — | (3,910 | ) | — | (3,910 | ) | |||||||||||||
Net increase (decrease) in cash and cash equivalents | 3,721 | (91 | ) | 32,172 | — | 35,802 | ||||||||||||||
Cash and cash equivalents—beginning of year | 12,401 | 91 | 55,692 | — | 68,184 | |||||||||||||||
Cash and cash equivalents—end of year | $ | 16,122 | $ | — | $ | 87,864 | $ | — | $ | 103,986 |
Year Ended August 31, 2012 | ||||||||||||||||||||
Parent | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||
Operating Activities | ||||||||||||||||||||
Net cash provided by operating activities | $ | 97,454 | $ | 20,363 | $ | 64,512 | $ | — | $ | 182,329 | ||||||||||
Investing Activities | ||||||||||||||||||||
Proceeds from sale of property, plant & equipment | 1,909 | 353 | 6,239 | — | 8,501 | |||||||||||||||
Capital expenditures | (5,062 | ) | (4,069 | ) | (13,609 | ) | — | (22,740 | ) | |||||||||||
Business acquisitions, net of cash acquired | — | — | (69,309 | ) | — | (69,309 | ) | |||||||||||||
Cash used in investing activities | (3,153 | ) | (3,716 | ) | (76,679 | ) | — | (83,548 | ) | |||||||||||
Financing Activities | ||||||||||||||||||||
Net repayments on revolving credit facilities | (57,990 | ) | — | (177 | ) | — | (58,167 | ) | ||||||||||||
Intercompany loan activity | (11,482 | ) | (16,556 | ) | 28,038 | — | — | |||||||||||||
Principal repayment on term loans | (2,500 | ) | — | — | — | (2,500 | ) | |||||||||||||
Repurchases of 2% Convertible Notes | (102 | ) | — | — | — | (102 | ) | |||||||||||||
Proceeds from issuance of 5.625% Senior Notes | 300,000 | — | — | — | 300,000 | |||||||||||||||
Redemption of 6.875% Senior Notes | (250,000 | ) | — | — | — | (250,000 | ) | |||||||||||||
Payment of deferred acquisition consideration | (290 | ) | — | (668 | ) | — | (958 | ) | ||||||||||||
Debt issuance costs | (5,490 | ) | — | — | — | (5,490 | ) | |||||||||||||
Purchase of treasury shares | (63,083 | ) | — | — | — | (63,083 | ) | |||||||||||||
Stock option exercises and related tax benefits | 10,913 | — | — | — | 10,913 | |||||||||||||||
Cash dividend | (2,748 | ) | — | — | — | (2,748 | ) | |||||||||||||
Cash provided (used in) financing activities | (82,772 | ) | (16,556 | ) | 27,193 | — | (72,135 | ) | ||||||||||||
Effect of exchange rate changes on cash | — | — | (2,683 | ) | — | (2,683 | ) | |||||||||||||
Net increase in cash and cash equivalents | 11,529 | 91 | 12,343 | — | 23,963 | |||||||||||||||
Cash and cash equivalents—beginning of year | 872 | — | 43,349 | — | 44,221 | |||||||||||||||
Cash and cash equivalents—end of year | $ | 12,401 | $ | 91 | $ | 55,692 | $ | — | $ | 68,184 |
Year Ended August 31, 2011 | ||||||||||||||||||||
Parent | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||
Operating Activities | ||||||||||||||||||||
Net cash provided by operating activities | $ | 92,573 | $ | 3,122 | $ | 77,404 | $ | (1,533 | ) | $ | 171,566 | |||||||||
Investing Activities | ||||||||||||||||||||
Proceeds from sale of property, plant & equipment | 103 | 313 | 1,363 | — | 1,779 | |||||||||||||||
Proceeds from sale of business | — | — | 3,463 | — | 3,463 | |||||||||||||||
Capital expenditures | (5,284 | ) | (4,740 | ) | (13,072 | ) | — | (23,096 | ) | |||||||||||
Business acquisitions, net of cash acquired | (153,409 | ) | — | (159,697 | ) | — | (313,106 | ) | ||||||||||||
Cash used in investing activities | (158,590 | ) | (4,427 | ) | (167,943 | ) | — | (330,960 | ) | |||||||||||
Financing Activities | ||||||||||||||||||||
Net borrowings on revolving credit facilities | 58,000 | — | 204 | — | 58,204 | |||||||||||||||
Proceeds from issuance of term loans | 100,000 | — | — | — | 100,000 | |||||||||||||||
Repurchases of 2% Convertible Notes | (34 | ) | — | — | — | (34 | ) | |||||||||||||
Intercompany loan activity | (96,454 | ) | 1,655 | 94,799 | — | — | ||||||||||||||
Payment of deferred acquisition consideration | — | (350 | ) | — | — | (350 | ) | |||||||||||||
Debt issuance costs | (5,197 | ) | — | — | — | (5,197 | ) | |||||||||||||
Stock option exercises and related tax benefits | 8,235 | — | — | — | 8,235 | |||||||||||||||
Cash dividend | (2,716 | ) | — | (1,533 | ) | 1,533 | (2,716 | ) | ||||||||||||
Cash provided by financing activities | 61,834 | 1,305 | 93,470 | 1,533 | 158,142 | |||||||||||||||
Effect of exchange rate changes on cash | — | — | 5,251 | — | 5,251 | |||||||||||||||
Net increase (decrease) in cash and cash equivalents | (4,183 | ) | — | 8,182 | — | 3,999 | ||||||||||||||
Cash and cash equivalents—beginning of year | 5,055 | — | 35,167 | — | 40,222 | |||||||||||||||
Cash and cash equivalents—end of year | $ | 872 | $ | — | $ | 43,349 | $ | — | $ | 44,221 |
Year Ended August 31, 2013 | ||||||||||||||||||||
First | Second | Third | Fourth | Total | ||||||||||||||||
Net sales | $ | 307,809 | $ | 300,468 | $ | 344,205 | $ | 327,260 | $ | 1,279,742 | ||||||||||
Gross profit | 124,368 | 116,178 | 136,904 | 129,500 | 506,950 | |||||||||||||||
Earnings from continuing operations | 30,551 | 25,834 | 46,077 | 45,115 | 147,577 | |||||||||||||||
Earnings (loss) from discontinued operations | 5,792 | 2,601 | (139,060 | ) | 13,138 | (117,529 | ) | |||||||||||||
Net earnings (loss) | 36,343 | 28,435 | (92,983 | ) | 58,253 | 30,048 | ||||||||||||||
Earnings from continuing operations per share: | ||||||||||||||||||||
Basic | $ | 0.42 | $ | 0.35 | $ | 0.63 | $ | 0.62 | $ | 2.02 | ||||||||||
Diluted | 0.41 | 0.35 | 0.62 | 0.60 | 1.98 | |||||||||||||||
Earnings (loss) from discontinued operations per share: | ||||||||||||||||||||
Basic | $ | 0.08 | $ | 0.04 | $ | (1.90 | ) | $ | 0.18 | $ | (1.61 | ) | ||||||||
Diluted | 0.08 | 0.03 | (1.86 | ) | 0.18 | (1.58 | ) | |||||||||||||
Net earnings (loss) per share: | ||||||||||||||||||||
Basic | $ | 0.50 | $ | 0.39 | $ | (1.27 | ) | $ | 0.80 | $ | 0.41 | |||||||||
Diluted | 0.49 | 0.38 | (1.24 | ) | 0.78 | 0.40 | ||||||||||||||
Year Ended August 31, 2012 | ||||||||||||||||||||
First | Second | Third | Fourth | Total | ||||||||||||||||
Net sales | $ | 309,966 | $ | 300,919 | $ | 343,268 | $ | 322,368 | $ | 1,276,521 | ||||||||||
Gross profit | 127,015 | 116,083 | 138,754 | 129,608 | 511,460 | |||||||||||||||
Earnings from continuing operations | 33,970 | 27,653 | 27,737 | 35,916 | 125,276 | |||||||||||||||
Earnings (loss) from discontinued operations | 3,204 | 4,522 | 6,664 | (52,376 | ) | (37,986 | ) | |||||||||||||
Net earnings (loss) | 37,174 | 32,175 | 34,401 | (16,460 | ) | 87,290 | ||||||||||||||
Earnings from continuing operations per share: | ||||||||||||||||||||
Basic | $ | 0.50 | $ | 0.41 | $ | 0.39 | $ | 0.49 | $ | 1.79 | ||||||||||
Diluted | 0.46 | 0.37 | 0.36 | 0.48 | 1.68 | |||||||||||||||
Earnings (loss) from discontinued operations per share: | ||||||||||||||||||||
Basic | $ | 0.04 | $ | 0.06 | $ | 0.09 | $ | (0.72 | ) | $ | (0.54 | ) | ||||||||
Diluted | 0.04 | 0.06 | 0.09 | (0.70 | ) | (0.51 | ) | |||||||||||||
Net earnings (loss) per share: | ||||||||||||||||||||
Basic | $ | 0.54 | $ | 0.47 | $ | 0.48 | $ | (0.23 | ) | $ | 1.25 | |||||||||
Diluted | 0.50 | 0.43 | 0.45 | (0.22 | ) | 1.17 |
Additions | Deductions | |||||||||||||||||||||||
Description | Balance at Beginning of Period | Charged to Costs and Expenses | Acquired/ (Divested)/ (Discontinued) | Accounts Written Off Less Recoveries | Other | Balance at End of Period | ||||||||||||||||||
Allowance for losses—Trade accounts receivable | ||||||||||||||||||||||||
August 31, 2013 | $ | 4,375 | $ | 584 | $ | (437 | ) | $ | (787 | ) | $ | (34 | ) | $ | 3,701 | |||||||||
August 31, 2012 | 7,173 | 107 | 96 | (2,740 | ) | (261 | ) | 4,375 | ||||||||||||||||
August 31, 2011 | 7,680 | 1,021 | 939 | (3,048 | ) | 581 | 7,173 | |||||||||||||||||
Valuation allowance—Income taxes | ||||||||||||||||||||||||
August 31, 2013 | $ | 8,153 | $ | 4,527 | $ | 11,281 | $ | (1,184 | ) | $ | — | $ | 22,777 | |||||||||||
August 31, 2012 | 7,260 | 2,954 | — | (2,061 | ) | — | 8,153 | |||||||||||||||||
August 31, 2011 | 8,542 | 4,498 | — | (5,831 | ) | 51 | 7,260 |
ACTUANT CORPORATION (Registrant) | ||
By: | /S/ ANDREW G. LAMPEREUR | |
Andrew G. Lampereur | ||
Executive Vice President and Chief Financial Officer | ||
(Principal Financial Officer) |
Signature | Title | |
/s/ ROBERT C. ARZBAECHER | Chairman of the Board and Chief Executive Officer | |
Robert C. Arzbaecher | ||
/s/ GUSTAV H.P. BOEL | Director and Executive Vice President | |
Gustav H.P. Boel | ||
/s/ GURMINDER S. BEDI | Director | |
Gurminder S. Bedi | ||
/s/ MARK E. GOLDSTEIN | Director and President | |
Mark E. Goldstein | ||
/s/ WILLIAM K. HALL | Director | |
William K. Hall | ||
/s/ THOMAS J. FISCHER | Director | |
Thomas J. Fischer | ||
/s/ ROBERT A. PETERSON | Director | |
Robert A. Peterson | ||
/s/ DENNIS K. WILLIAMS | Director | |
Dennis K. Williams | ||
/s/ HOLLY A. VANDEURSEN | Director | |
Holly A. VanDeursen | ||
/s/ R. ALAN HUNTER, JR | Director | |
R. Alan Hunter, Jr. | ||
/s/ ANDREW G. LAMPEREUR | Executive Vice President and Chief Financial Officer (Principal Financial Officer) | |
Andrew G. Lampereur | ||
/s/ MATTHEW P. PAULI | Corporate Controller and Principal Accounting Officer | |
Matthew P. Pauli |
Exhibit | Description | Incorporated Herein By Reference To | Filed Herewith | Furnished Herewith | |||||
2.1 | (a) Agreement for the Sale and Purchase of Venice Topco Limited, dated August 2, 2013, by and among HSBC Investment Bank Holdings PLC, Actuant Acquisitions Limited, Actuant Corporation and certain other parties thereto | X | |||||||
(b) Warranty Deed relating to the Sale and Purchase of Venice Topco Limited, by and among Actuant Acquisitions Limited and the Management Warrantors that are party thereto | X | ||||||||
3.1 | (a) Amended and Restated Articles of Incorporation | Exhibit 4.9 to the Registrant’s Form 10-Q for the quarter ended February 28, 2001 | |||||||
(b) Amendment to Amended and Restated Articles of Incorporation | Exhibit 3.1(b) of the Registrant’s Form 10-K for the fiscal year ended August 31, 2003 | ||||||||
(c) Amendment to Amended and Restated Articles of Incorporation | Exhibit 3.1 to the Registrant’s Form 10-K for the fiscal year ended August 31, 2004 | ||||||||
(d) Amendment to Amended and Restated Articles of Incorporation | Exhibit 3.1 to the Registrant’s Form 8-K filed on July 18, 2006 | ||||||||
(e) Amendment of Amended and Restated Articles of Incorporation | Exhibit 3.1 to the Registrant’s Form 8-K filed on January 14, 2010 | ||||||||
3.2 | Amended and Restated Bylaws, as amended | X | |||||||
4.1 | Indenture dated April 16, 2012 by and among Actuant Corporation, the subsidiary guarantors named therein and U.S. Bank National Association as trustee relating to $300 million Actuant Corporation 5 5/8% Senior Notes due 2022 | Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on April 18, 2012 |
Exhibit | Description | Incorporated Herein By Reference To | Filed Herewith | Furnished Herewith | |||||
4.2 | Registration Rights Agreement, dated April 16, 2012, relating to $300 million of 5 5/8% Senior Notes due 2022 | Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on April 18, 2012 | |||||||
4.3 | Third Amended and Restated Credit Agreement dated February 23, 2011 among Actuant Corporation, the Lenders party thereto and JPMorgan Chase Bank, N.A. as the agent | Exhibit 10.1 to the Registrant’s Form 10-Q for the quarter ended February 28, 2011 | |||||||
4.4 | Omnibus Amendment No. 1 dated September 23, 2011 among Actuant Corporation, the Lender party thereto and JPMorgan Chase Bank, N.A. as agent | Exhibit 4.9 to the Registrant’s Form 10-K for the fiscal year ended August 31, 2011. | |||||||
4.5 | (a) Fourth Amended and Restated Credit Agreement dated July 18, 2013 among Actuant Corporation, the Lenders party thereto and JPMorgan Chase Bank, N.A. as the agent | X | |||||||
(b) First Amendment to the Fourth Amended and Restated Credit Agreement dated August 27, 2013 among Actuant Corporation, the Lenders party thereto and JPMorgan Chase Bank, N.A. as the agent | X | ||||||||
10.1 | Outside Directors’ Deferred Compensation Plan (conformed through the first amendment) | X | |||||||
10.2 | Actuant Corporation Deferred Compensation Plan (conformed through the third amendment) | Exhibit 10.3 to the Registrant's Form 10-K for the fiscal year ended August 31, 2012 | |||||||
10.3 | Actuant Corporation 2010 Employee Stock Purchase Plan | Exhibit B to the Registrants Proxy Statement, dated December 4, 2009 | |||||||
10.4 | (a) Actuant Corporation 2001 Stock Plan | Exhibit B to the Registrant’s Proxy Statement, dated December 1, 2000 for the 2001 Annual Meeting of Shareholders | |||||||
(b) First Amendment to the Actuant Corporation 2001 Stock Plan dated December 25, 2008 | Exhibit 10.9 to the Registrant’s Form 10-Q for the quarter ended November 30, 2008 |
Exhibit | Description | Incorporated Herein By Reference To | Filed Herewith | Furnished Herewith | |||||
10.5 | (a) Actuant Corporation 2002 Stock Plan, as amended (through third amendment) | Exhibit 10.26 to the Registrant’s Form 8-K filed on January 20, 2006 | |||||||
(b) Fourth Amendment to the Actuant Corporation 2002 Stock Plan dated November 7, 2008 | Exhibit 10.11 to the Registrant’s Form 10-Q for the quarter ended November 30, 2008 | ||||||||
10.6 | Actuant Corporation 2009 Omnibus Incentive Plan, conformed to reflect the Second Amendment thereto | Exhibit 99.1 to the Registrant’s Form 8-K filed on January 17, 2013 | |||||||
10.7 | (a) Actuant Corporation 2001 Outside Directors’ Stock Plan | Exhibit A to the Registrant’s Proxy Statement, dated December 5, 2005 for the 2006 Annual Meeting of Shareholders | |||||||
(b) First Amendment to the Amended and Restated Actuant Corporation 2001 Outside Directors’ Stock Plan dated December 25, 2008 | Exhibit 10.10 to the Registrant’s Form 10-Q for the quarter ended November 30, 2008 | ||||||||
10.8 | Actuant Corporation Long Term Incentive Plan | Exhibit 10.25 to the Registrant’s Form 8-K filed on July 12, 2006 | |||||||
10.9 | Form of Indemnification Agreement for Directors and Officers | Exhibit 10.35 to the 2002 10-K | |||||||
10.10 | (a) Form of Actuant Corporation Change in Control Agreement for Messrs. Arzbaecher, Blackmore, Goldstein, Kobylinski, Lampereur, Scheer, Wozniak, Ms. Grissom and Ms. Roberts | Exhibit 10.1 to the Registrant’s Form 8-K filed on May 2, 2012 | |||||||
(b) Form of Actuant Corporation Change in Control Agreement for Messrs. Axline and Boel | Exhibit 10.2 to the Registrant’s Form 8-K filed on May 2, 2012 | ||||||||
(c) Amendment to Actuant Corporation Change in Control Agreement for Mr. Scheer | X | ||||||||
10.11 | Actuant Corporation Executive Officer Bonus Plan | Exhibit B to the Registrant's Definitive Proxy statement dated December 3, 2012 | |||||||
Exhibit | Description | Incorporated Herein By Reference To | Filed Herewith | Furnished Herewith | |||||
10.12* | Retention Bonus Agreement between Actuant Corporation and Mr. Scheer | X | |||||||
10.13 | Consulting Services Agreement between Actuant Corporation and Mr. Boel | X | |||||||
10.14 | Consulting Services Agreement between Actuant Corporation and Mr. Axline | X | |||||||
14 | Code of Ethics | Exhibit 14 of the Registrant’s Form 10-K for the fiscal year ended August 31, 2003 | |||||||
21 | Subsidiaries of the Registrant | X | |||||||
23 | Consent of PricewaterhouseCoopers LLP | X | |||||||
24 | Power of Attorney | See signature page of this report | |||||||
31.1 | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | X | |||||||
31.2 | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | X | |||||||
32.1 | Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | X | |||||||
32.2 | Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | X | |||||||
Exhibit | Description | Incorporated Herein By Reference To | Filed Herewith | Furnished Herewith | |||||
101 | The following materials from the Actuant Corporation Form 10-K for the year ended August 31, 2013 formatted in Extensible Business Reporting Language (XBRL): (i) the Consolidated Statements of Earnings, (ii) the Consolidated Statements of Comprehensive Income, (iii) the Consolidated Balance Sheets, (iv) the Consolidated Statements of Cash Flows and (v) the Notes to Consolidated Financial Statements. | X |
Exhibit 2.1(a) |
AGREEMENT FOR THE SALE AND PURCHASE OF VENICE TOPCO LIMITED |
DATED 2 AUGUST 2013 |
THE INSTITUTIONAL SELLER AND THE SENIOR MANAGEMENT SELLERS AND THE OTHER SELLERS AND THE MANAGERS AND THE PURCHASER AND THE GUARANTOR |
1. | Definitions and Interpretation | 1 | ||
2. | Sale and Purchase | 11 | ||
3. | Consideration | 11 | ||
4. | Escrow Account and Conduct of Claims | 11 | ||
5. | Condition Precedent | 14 | ||
6. | Pre-Completion Undertakings | 15 | ||
7. | Completion | 19 | ||
8. | Post Completion | 20 | ||
9. | Warranties and Undertakings | 22 | ||
10. | Purchaser's Warranties and Undertakings | 23 | ||
11. | Guarantor's Warranties and Undertakings | 25 | ||
12. | Guarantee | 26 | ||
13. | Announcements and Confidentiality | 27 | ||
14. | Notices | 29 | ||
15. | Further Assurances | 31 | ||
16. | Post Completion Undertakings | 32 | ||
17. | Assignments | 33 | ||
18. | Payments | 33 | ||
19. | General | 34 | ||
20. | Whole Agreement | 36 | ||
21. | Institutional Seller Representative | 37 | ||
22. | Senior Management Representative | 37 | ||
23. | Governing Law and Jurisdiction | 38 |
1. | The Sellers | 38 | ||
Part 1 | The Institutional Seller | 38 | ||
Part 2 | The Senior Management Sellers | 39 | ||
Part 3 | Managers | 40 | ||
Part 4 | The Other Sellers | 41 | ||
2. | Company Details | 42 | ||
3. | Completion | 43 | ||
Part 1 | Sellers' Obligations | 43 | ||
Part 2 | Purchaser's Obligations | 44 | ||
4. | Limitations on Claims | 45 | ||
5. | Basis of Preparation of Completion Statement and Final Completion Statement | 48 | ||
6. | Pro Forma Completion Statement | 51 | ||
7. | Pro Forma Final Completion Statement | 52 | ||
8. | Independent Accountants | 54 | ||
Signatories | 56 |
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(1) | HSBC INVESTMENT BANK HOLDINGS PLC whose address is set out in Part 1 of Schedule 1 (The Sellers) (the Institutional Seller); |
(2) | THE PERSONS whose names and addresses are set out in Part 2 of Schedule 1 (The Sellers) (each a Senior Management Seller and together the Senior Management Sellers); |
(3) | THE PERSONS whose names and addresses are set out in Part 3 of Schedule 1 (The Sellers) (each a Manager and together the Managers); |
(4) | THE PERSONS whose names and addresses are set out in Part 4 of Schedule 1 (The Sellers) (each an Other Seller and together the Other Sellers, and together with the Institutional Seller and the Senior Management Sellers, the Sellers, and Seller shall be construed accordingly); |
(5) | ACTUANT ACQUISITIONS LIMITED (registered number 07633576) whose address is Unit 601 Axcess 10 Business Park, Bentley Road South, Darlaston, West Midlands WS10 8LQ, United Kingdom (the Purchaser); and |
(6) | ACTUANT CORPORATION whose address is N86 W12500 Westbrook Crossing, Menomonee Falls, Wisconsin 53051, United States (the Guarantor). |
(A) | The Sellers together own the entire issued share capital of Venice Topco Limited (the Company). Details of the Company are contained in Schedule 2 (Company Details). |
(B) | The Sellers wish to sell and the Purchaser wishes to purchase all the issued share capital of the Company free from any Encumbrances on the terms, and subject to the conditions, set out in this agreement. |
(C) | The Guarantor is the ultimate holding company of the Purchaser and wishes to guarantee all of the obligations of the Purchaser arising pursuant to this agreement. |
1. | DEFINITIONS AND INTERPRETATION |
1.1 | Definitions |
(a) | a nominee – the beneficial owner in respect of which the nominee is holding Shares or another nominee of the same beneficial owner; |
(b) | a corporation – its subsidiaries, its holding company and any other subsidiaries of that holding company; |
(c) | a fund managed professionally for investment purposes or any person managing the investments of such a fund and/or: |
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(i) | any other person or persons managing the investments of such funds or which are within the same wholly owned group as any person managing the investments of such funds or is or are a nominee or trustee for any of such persons; |
(ii) | a nominee holding assets for such fund; or |
(iii) | another fund which is controlled or managed by the same fund manager or by another member of the same wholly owned group as such fund manager or any nominee holding assets for any such other fund; |
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(a) | £42,000,000 15% subordinated redeemable loan notes due 2019 of Venice Fundco Limited issued to the Institutional Seller; and |
(b) | £3,500,000 loan agreement dated 15 November 2010 between, amongst others, the Institutional Seller as lender and Venice Fundco Limited as borrower; |
(a) | changes in stock markets, interest rates, exchange rates, commodity prices or other general economic conditions save where such changes have or are reasonably expected to have a disproportionate adverse effect on the Group taken as a whole; |
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(b) | changes in conditions generally affecting the oil services industry save where such changes have or are reasonably expected to have a disproportionate adverse effect on the Group taken as a whole; |
(c) | war or political unrest in any country or region save where such event has or is reasonably expected to have a disproportionate adverse effect on the Group taken as a whole; |
(d) | changes in laws or regulations save where such changes have or are reasonably expected to have a disproportionate adverse effect on the Group taken as a whole; or |
(e) | the disclosure of the identity of the Purchaser; |
(a) | any unpaid vendor's or supplier's lien arising in the ordinary course of the Business in order to secure amounts which are due for goods or services sold or supplied; and |
(b) | liens arising by operation of law, including a banker's lien; |
(a) | if the relevant day is a Business Day: |
(i) | the rate for deposits in £ for a period of three months which appears on Reuters Page "LIBOR01" as at 11am London time; or |
(ii) | the London Inter Bank Offered Rate for deposits in £ for a period of three months as quoted in the London Financial Times, if the rate is not available on Reuters Page "LIBOR01"; or |
(b) | if the relevant day is not a Business Day: |
(i) | the rate for deposits in £ for a period of three months which appears on Reuters Page "LIBOR01" as at 11am London time on the immediately preceding Business Day; or |
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(ii) | the London Inter Bank Offered Rate for deposits in £ for a period of three months as quoted in the London Financial Times on the immediately preceding Business Day, if the rate is not available on Reuters Page "LIBOR01"; |
(a) | a supply contract entered into in May 2010 between Viking and Songa comprising purchase orders TRYMAR1801778 and TRYMAR1801779; and |
(b) | a manufacturing contract entered into in May 2010 between Viking and Zibo comprising purchase orders 0000051 and 0000052; |
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(a) | HSBC M&A fees; |
(b) | KPMG Vendor Assist; |
(c) | KPMG Audit; |
(d) | E&Y Tax; |
(e) | Norton Rose LLP; |
(f) | KPMG Vendor Due Diligence; |
(g) | Merrill Corporation; |
(h) | Pinsent Masons LLP; |
(i) | Clayton Utz LLP; |
(j) | Schjodt; |
(k) | Wong Partnership; |
(l) | IHS fees; |
(m) | Directors’ & Officers’ Run-off Insurance; |
(n) | Alix Partners Payment; and |
(o) | any other third party professional advisory fees and expenses incurred by the Group at the Institutional Seller’s request in connection with the Transaction and which are unpaid (whether unbilled or the subject of an outstanding invoice); |
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1.2 | Statutes |
(a) | that enactment as amended, extended or applied by or under any other enactment (before, on or after the date of this agreement); |
(b) | any enactment which that enactment re-enacts (with or without modification); and |
(c) | any subordinate legislation (including regulations) made (before, on or after the date of this agreement) under that enactment, including (where applicable) that enactment as amended, extended or applied as described in subparagraph (a), or under any enactment which it re-enacts as described in subparagraph (b), |
1.3 | Interpretation |
(a) | words denoting persons include bodies corporate and unincorporated associations of persons; |
(b) | references to an individual include his estate and personal representatives; |
(c) | subject to clause 17 (Assignments), references to a party to this agreement include the successors or permitted assigns (immediate or otherwise) of that party; |
(d) | a person shall be deemed connected with another if that person is connected with that other within the meaning of sections 1122 and 1123 of the Corporation Tax Act 2010 other than sections 1122(4) and 1122(7), except that no Seller shall be connected with the Purchaser or any Group Company, nor shall any Seller be connected with any other Seller (or a connected person of another Seller) by virtue of the transactions contemplated by this agreement or being a holder of Shares in the Company; |
(e) | the words including and include shall mean including without limitation and include without limitation, respectively; |
(f) | the singular includes the plural (and vice versa); |
(g) | any reference importing a gender includes the other genders; |
(h) | any reference to a time of day is to London time; |
(i) | any reference to £ is to British Pounds Sterling; |
(j) | any reference to writing includes typing, printing, lithography, photography and facsimile but excludes any other form of Electronic Communication; |
(k) | any reference to a document is to that document as amended, varied or novated from time to time otherwise than in breach of this agreement or that document; |
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(l) | any reference to a company includes any company, corporation or other body corporate wheresoever incorporated; |
(m) | any reference to a company or firm includes any company or firm in succession to all, or substantially all, of the business of that company or firm; |
(n) | unless the contrary intention appears, a reference to a clause, sub-clause or schedule is a reference to a clause, sub-clause or schedule of or to this agreement. The schedules, and the recitals in the Background section, form part of this agreement; |
(o) | the headings do not affect its interpretation; |
(p) | if there is any conflict or inconsistency between a term in the body of this agreement and a term in any of the schedules, the term in the body of this agreement shall take precedence; |
(q) | the ejusdem generis rule does not apply. Accordingly, specific words indicating a type, class or category of thing shall not restrict the meaning of general words following such specific words, such as general words introduced by the word "other" or a similar expression. Similarly, general words followed by specific words shall not be restricted in meaning to the type, class or category of thing indicated by such specific words; |
(r) | a reference to any English legal term for any action, remedy, method or form of judicial proceeding, legal document, court or other legal concept or matter shall be deemed to include a reference to the corresponding or most similar legal term in any jurisdiction other than England, to the extent that such jurisdiction is relevant to the Transaction; and |
(s) | notices to be provided under clauses 6.1(c), 6.3 and 6.4 may be provided by email. |
2. | SALE AND PURCHASE |
2.1 | Sale and purchase |
2.2 | Encumbrances |
2.3 | No obligation to complete |
3. | CONSIDERATION |
3.1 | Apportionment |
3.2 | Reduction of Consideration |
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4. | ESCROW ACCOUNT AND CONDUCT OF CLAIMS |
4.1 | The Escrow Account shall be operated, and the Escrow Sum and interest accruing on it (or any part of it) shall be applied, in accordance with this clause and the provisions of the Escrow Agreement. On Completion, the Purchaser shall procure the payment of the Escrow Sum to the Escrow Account. |
4.2 | If HMRC delivers to the Company a notice of assessment alleging an underpayment of Class 1 national insurance contributions by reason of the Bayliss Shares being classed as “readily convertible assets” for the purposes of section 702 Income Tax (Earnings and Pensions) Act 2003 when they were acquired by William Bayliss (a Bayliss Claim), then if the Bayliss Claim becomes a Determined Claim before the Release Date, an amount equal thereto shall be paid to the Purchaser from the Escrow Account. |
4.3 | In clause 4.2 (Escrow Account and Conduct of Claims) above: |
(a) | a Determined Claim means a Bayliss Claim which is either: |
(i) | agreed by the Institutional Seller in writing (including, but not limited to, agreement on the quantum of the Bayliss Claim); or |
(ii) | adjudged final by any judgment or settlement order, that judgment or order being incapable of appeal or where the persons entitled to appeal have elected in writing not to appeal, or any time period for appeal has expired without the relevant right of appeal having been validly exercised, |
4.4 | The balance of the Escrow Sum after the payment of the aggregate of all outstanding Determined Liabilities under clause 4.2 (Escrow Account and Conduct of Claims) (if any) shall be released to the Sellers on 20 May 2014 (the Release Date). |
4.5 | If there has been a Bayliss Claim that has not become a Determined Claim on or before the Release Date, then the Escrow Amount will remain in the Escrow Account pending such Bayliss Claim becoming a Determined Claim in accordance with clause 4.3 (Escrow Account and Conduct of Claims). Within 10 Business Days of such Bayliss Claim becoming a Determined Claim, an amount equal to any Determined Liabities in respect of that Determined Claim shall be paid to the Purchaser from the Escrow Account and the balance of the Escrow Sum (if any) shall be released to the Sellers. |
4.6 | Any interest which accrues on the Escrow Sum (or any part of it) while in the Escrow Account shall follow the principal amount and shall be paid to the Sellers or the Purchaser (as the case may be) at the same time as payment of the corresponding principal. |
4.7 | Each Seller shall be entitled to that percentage set against its name in the column “Percentage of Consideration” in Schedule 1 (The Sellers) of any sum released to the Sellers from the Escrow Account under this clause 4 (Escrow Account and Conduct of Claims). |
4.8 | The Institutional Seller’s Representative shall prior to Completion promptly give or join in giving all such instructions as are necessary to procure the entry into of the Escrow Agreement and, after Completion the operation of the Escrow Account, and application of the Escrow Sum and interest accruing on it (or any part of it), in accordance with the provisions of this clause and the Escrow Agreement. |
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4.9 | The Purchaser shall procure that the fees and expenses of the Escrow Agent shall be borne by the Company. |
4.10 | If the Purchaser or any member of the Purchaser’s Group becomes aware of an assessment notice, letter, demand or other document issued or action taken by or on behalf of any tax authority or any form of return, computation, account, other document or self-assessment required by law from which it appears that a Group Company is subject to, or is sought to be made subject to, or will or might become subject to, any Tax liability (including but not limited to the imposition or withholding of or on account of any Tax or any amount in the nature of Tax) with respect to a Bayliss Claim (a Tax Matter), the Purchaser shall give notice to the Institutional Seller specifying that Tax Matter in reasonable detail as soon as reasonably practicable (and in any event within 10 Business Days) after it or the relevant member of the Purchaser’s Group (as the case may be) becomes aware of that Tax Matter. |
4.11 | The Institutional Seller may give notice to the Purchaser that it elects to assume the conduct of any dispute, compromise, defence or appeal of a Tax Matter (a Tax Dispute) within 15 Business Days of receiving notice of the Tax Matter pursuant to clause 4.10 on the following terms in which case: |
(a) | the Institutional Seller shall indemnify the Company against all liabilities, damages, costs and expenses that it may reasonably incur in taking any such action as the Institutional Seller may request pursuant to sub-paragraph (c) below (including any additional liability in respect of Taxation that arises as a result of any actions of the Institutional Seller, (save to the extent that such liability constitutes a Determined Liability), and third party costs and expenses); |
(b) | the Purchaser shall make and shall procure that the Company makes available to the Institutional Seller and its advisers such access to personnel and to relevant documents and records within the Purchaser’s or the Company’s power or control as the Institutional Seller may reasonably request for assessing, contesting, disputing, defending, appealing or compromising the Tax Dispute; |
(c) | the Purchaser shall procure that the Company takes such action to contest, dispute, defend, appeal or compromise the Tax Dispute as the Institutional Seller may reasonably request and does not make any admission of liability, agreement, settlement or compromise in relation to the Tax Dispute without the prior written approval of the Institutional Seller; |
(d) | the Institutional Seller shall keep the Purchaser informed of the progress of the Tax Dispute and provide the Purchaser with copies of all relevant documents and such other information in its possession as may be requested by the Purchaser (acting reasonably); |
(e) | the Institutional Seller shall be entitled at any stage and in its sole discretion (acting in good faith) to enter into a final settlement of any Tax Dispute; and |
(f) | notwithstanding sub-paragraph (c) above, the Purchaser and the Company shall not be obliged to comply with any request of the Institutional Seller which involves appealing, or otherwise taking any action in respect of, any Tax Dispute beyond the first appellate body (excluding the tax authority which has made the Tax Matter in question, the statutory pre-tribunal review and the tax chamber of the first-tier tribunal) unless the Institutional Seller (at its sole cost and expense) furnishes the Purchaser with the written opinion of tax counsel of at least ten years’ call who is experienced in the subject matter of the Tax Dispute to the effect that there is a reasonable prospect that the appeal in respect of the matter in question will succeed; and (ii) the Purchaser and the Company shall not be obliged to take any action in relation to a Tax Dispute where any tax authority alleges in writing (which allegation is not withdrawn) fraudulent conduct or conduct involving dishonesty has been committed in relation to such Tax Matter. |
4.12 | If: |
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(a) | within 15 Business Days of having given written notice to the Institutional Seller of a Tax Matter, the Purchaser does not receive from the Institutional Seller notification of an election under Clause 4.11; or |
(b) | any tax authority alleges in writing that fraudulent conduct or conduct involving dishonesty has been committed in relation to such Tax Matter, and such allegation is not withdrawn after the Institutional Seller has had a reasonable opportunity to challenge it, |
(a) | keeps the Institutional Seller reasonably informed of all matters relating to the Tax Matter and delivers to the Institutional Seller copies of all material correspondence relating to the Tax Matter; and |
(b) | obtains the prior written approval of the Institutional Seller (not to be unreasonably withheld or unreasonably delayed) to the content and sending of written communications relating to the Tax Matter to a tax authority. |
4.13 | The Purchaser will act in good faith in connection with any issue relating to or that could give rise to a Bayliss Claim and will not (save to the extent required by law or regulation) voluntarily communicate to HMRC any matter that could give rise to a Bayliss Claim. |
5. | CONDITION PRECEDENT |
5.1 | Conditions |
(a) | the Competition Approval being given (or deemed to be given) on or before the Longstop Date (the Completion Condition); and |
(b) | there being no court order in effect that restrains or prohibits the parties from completing the Transaction or which invalidates the Transaction (Court Order). |
5.2 | Satisfaction of the Completion Condition |
5.3 | Communications |
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5.4 | Assistance |
5.5 | Notification |
5.6 | Competition Approval |
5.7 | Failure to satisfy the Completion Condition |
(a) | except for this clause 5.7, and clauses 1 (Definitions and Interpretation), 13 (Announcements and Confidentiality), 14 (Notices), 19.2 to 19.13 (General), 20 (Whole Agreement), 21 (Institutional Seller Representative), 22 (Senior Management Representative) and 23 (Governing Law and Jurisdiction), all the provisions of this agreement shall lapse and cease to have effect; and |
(b) | neither the lapsing of those provisions nor their ceasing to have effect shall affect any accrued rights or liabilities of any party in respect of damages for non-performance of any obligation falling due for performance before such lapse and cessation. |
6. | PRE-COMPLETION UNDERTAKINGS |
6.1 | Senior Management Seller and Manager undertakings |
(a) | the Business is carried on in the ordinary course consistent with practice in the six months prior to the date of this agreement; |
(b) | all transactions between a Group Company and a Seller or any of their respective Affiliates or persons connected to them take place on arm's length terms; |
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(c) | subject to paragraph (d) below, no Group Company shall, without the prior written consent of the Purchaser (such consent not to be unreasonably withheld or delayed): |
(i) | increase, reduce or otherwise alter its share or loan capital or grant any option to subscribe for or acquire any of its share or loan capital or take any action in respect of any Shares convertible into any share or loan capital (other than to another Group Company); |
(ii) | adopt any material new accounting policies or practices or materially change any of its accounting policies and practices or its accounting reference date, in each case except as required by law or to comply with a new accounting standard; |
(iii) | (save for the leasing of chain, fibre, wire, buoyancy, anchors and associated support equipment and fittings in the ordinary course of business) sell, transfer, lease, license or dispose of, or grant any option to acquire, any material part of its business, undertaking or assets, whether by a single transaction or series of transactions, related or not, involving aggregate consideration, expenditure or liabilities in excess of £100,000, other than where the same results from an asset being lost or damaged beyond repair; |
(iv) | enter into a legally binding commitment to acquire (whether by purchase, subscription or otherwise), lease or license any business (whether by way of acquisition of business and assets or any interest in any body corporate that owns such business and assets); |
(v) | grant any Encumbrance over any of its assets (other than Permitted Security Interests); |
(vi) | borrow any monies or incur any indebtedness or other liability other than, in the ordinary course of trading, (A) trade credit or (B) drawing down under the External Facilities or (C) entering into finance leases; |
(vii) | incorporate a Subsidiary or liquidate or dissolve any Subsidiary or effect any hive-up or hive-down or any reorganisation of the business of a Group Company; |
(viii) | amend or vary any provision of, or enter into or offer to enter into, terminate (or give notice to terminate) or fail to enforce, any terms of employment or severance or post-employment (including in relation to benefits and pension fund commitments) with or of any Key Employee; |
(ix) | enter into or materially modify any agreement with any trade union or other employee representative body; |
(x) | (save for any cross-hire in which is effected in the ordinary course of business) enter into or terminate any contract, lease, license or arrangement: |
(A) | which will require capital expenditures by the Group that, when accumulated with all such capital expenditures incurred since the date of this agreement, will exceed £350,000 (in the aggregate); |
(B) | which is a joint venture, partnership or consortium agreement; or |
(C) | which has a term in excess of one year; |
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(xi) | give any guarantee, indemnity, counter indemnity, letter of credit or other agreement to secure an obligation of a Seller or any of its Affiliates; |
(xii) | settle any litigation where it could result in a payment by a Group Company exceeding £25,000, except for collection in the ordinary course of trading debts; |
(xiii) | cancel, or materially alter the level and extent of cover provided by, the policies of insurance as are in effect for the benefit of the Group immediately before the execution of this agreement; |
(xiv) | take any action as a result of which it would cease to possess or have access to its register of members (or equivalent); |
(xv) | make or revoke any tax election; |
(xvi) | make a material change to any collection practices, payment practices or other working capital practices; |
(xvii) | reduce the provision of five hundred and thirty two thousand seven hundred and sixty four British Pounds Sterling (£532,764) for the Songa Matter (save as a result of the payment by a Group Company in the ordinary course of any fee or expense incurred by it in connection with the Songa Matter, not exceeding in aggregate eighty thousand British Pounds Sterling (£80,000)) or settle any claim in connection with the Songa Matter, provided that the Senior Management Sellers shall notify the Purchaser as soon as practicable of any payments in connection with the Songa Matter and the resulting reduction in the provision; |
(xviii) | amend its articles of association; or |
(xix) | agree to do any of the actions referred to in sub-clauses 6.1(c)(i) to (xiv) above; |
(d) | paragraph (c) above shall not apply to the extent that any such action is: |
(i) | required to give effect to or to comply with this agreement; |
(ii) | required by law or applicable regulation; |
(iii) | undertaken in accordance with a contractual obligation entered into before the date of this agreement which has been disclosed to the Purchaser with sufficient detail to enable the Purchaser to identify the nature and scope of the matter disclosed (including the Senior Facilities Agreement and any agreement related to the External Facilities); |
(iv) | required to repay any outstanding principal or accrued interest under the External Facilities (and a Group Company may use available cash to repay any such amounts) or to otherwise discharge obligations under the External Facilities; or |
(v) | the Company declaring or paying any cash dividend or making any other cash distribution in respect of its profits, assets or reserves. |
6.2 | Several liability |
6.3 | Purchaser approval |
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6.4 | Institutional Seller Stamping |
(ii) | the Wandl Shares are duly registered in the name of the Institutional Seller in the Company’s register of members. |
6.5 | Institutional Seller undertaking |
6.6 | Material Adverse Change |
6.7 | Delivery by Institutional Seller |
(a) | the Completion Statement, together with copies of supporting documents relevant to the calculation of the Completion Amount including the Net Debt Estimate; and |
(b) | a notice specifying the: |
(i) | External Facilities Repayment Amount (supported by appropriate payoff letters); |
(ii) | amount of the Exit Bonuses; |
(iii) | amount of the Transaction Fees; and |
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(iv) | details of the account into which the Purchaser must pay the Completion Amount at Completion. |
7. | COMPLETION |
7.1 | Time and location |
(a) | Subject to the terms and conditions in this agreement, Completion shall take place at the offices of Allen & Overy LLP, One Bishops Square, London E1 6AD on the date that is selected by the Purchaser and is not earlier than three Business Days but no later than six Business Days following the day on which notification is given by the Purchaser in accordance with clause 5.5 that the Completion Condition is satisfied or such other date and at such other place as the Institutional Seller and the Purchaser may agree. |
(b) | The parties agree to use reasonable endeavours and co-operate in good faith with a view to a target Completion Date of 23 August 2013. |
7.2 | Completion obligations |
(a) | each of the Sellers shall observe and perform the provisions of Part 1 of Schedule 3 (Completion) to the extent applicable to them; and |
(b) | the Purchaser shall observe and perform the provisions of Part 2 of Schedule 3 (Completion). |
7.3 | Items held to order |
(a) | delivery of all documents and items required to be delivered at Completion in accordance with sub-clauses 7.2(a) and 7.2(b) (Completion obligations) and Schedule 3 (Completion) (or waiver of the delivery of them by the person entitled to receive the relevant document or item); and |
(b) | receipt of an electronic funds transfer to the bank account of the Institutional Seller's Solicitors of the Completion Amount, |
7.4 | Seller failure to complete |
(a) | not to complete the purchase of the Shares, in which case the provisions of clause 7.6 (Consequences of failure to complete) shall apply; or |
(b) | to fix a new time and date for Completion (being not more than 20 Business Days after the original date for Completion), in which case the provisions of clauses 7.2 (Completion obligations), 7.3 (Items held to order) and Schedule 3 (Completion) shall apply to Completion as so deferred but on the basis that such deferral may occur only once. |
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7.5 | Purchaser failure to complete |
(c) | not to complete the sale of the Shares, in which case the provisions of clause 7.6 (Consequences of failure to complete) shall apply; or |
(d) | to fix a new time and date for Completion (being not more than 20 Business Days after the original date for Completion) in which case the provisions of clauses 7.2 (Completion obligations), 7.3 (Items held to order) and Schedule 3 (Completion) shall apply to Completion as so deferred but on the basis that such deferral may occur only once. |
7.6 | Consequences of failure to complete |
(c) | except for clause 1 (Definitions and Interpretation), this sub-clause 7.6, and clauses 13 (Announcements and Confidentiality), 14 (Notices), 19.2 to 19.13 (General), 20 (Whole Agreement), 21 (Institutional Seller Representative), 22 (Senior Management Representative) and 23 (Governing Law and Jurisdiction), all the provisions of this agreement shall lapse and cease to have effect; and |
(d) | neither the lapsing of those provisions nor their ceasing to have effect shall affect any accrued rights or liabilities of any party in respect of damages for non-performance of any obligation falling due for performance before such lapse and cessation. |
8. | POST COMPLETION |
8.1 | Final Completion Statement |
8.2 | Objection Notice |
8.3 | Details required in the Objection Notice |
(c) | the specific items that are in dispute (the Disputed Amounts); and |
(d) | the adjustments which, in the Institutional Seller's opinion, ought to be made to the Final Completion Statement so that it complies with the provisions of this agreement. |
8.4 | Referral to an Independent Accountant |
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8.5 | Final Completion Statement binding |
(e) | deemed agreed (if the Institutional Seller does not issue an Objection Notice in accordance with clauses 8.2 (Objection Notice) and 8.3 (Details required in the Objection Notice)); |
(f) | agreed (if the parties are able to resolve any dispute); or |
(g) | determined (under clause 8.4 (Referral to an Independent Accountant)), |
8.6 | Payment of adjustment |
(a) | Once the Final Completion Statement is final and binding on the parties, then the payment due (if any) calculated in accordance with clause 8.7 (Adjustments) shall be paid by the Purchaser to the Institutional Seller or by the Institutional Seller to the Purchaser (as appropriate) within ten Business Days, together with Interest on such amount calculated from the Completion Date up to (but excluding) the date of payment and apportioned between the Sellers in proportion to their respective shareholdings as set out in the column "Percentage of Consideration" in Schedule 1 (The Sellers). |
(b) | The amounts (if any) payable by the Institutional Seller to the Purchaser or by the Purchaser to the Institutional Seller under sub-clause 8.6(a) shall be set off against each other so that only any balance payable shall be paid on the date on which a payment is to be made under sub-clause 8.6(a). |
8.7 | Adjustments |
(a) | If the Completion Amount set forth on the Final Completion Statement is in excess of the Completion Amount set forth on the Completion Statement, then the Purchaser shall pay the amount of such excess to the Institutional Seller in accordance with the provisions of clause 8.6 (Payment of adjustment). |
(b) | If the Completion Amount set forth on the Final Completion Statement is less than the Completion Amount set forth on the Completion Statement, then the Institutional Seller shall pay the amount of such deficiency to the Purchaser in accordance with the provisions of clause 8.6 (Payment of adjustment). |
(c) | The maximum positive adjustment in respect of working capital in favour of the Sellers under clause 8.6 (Payment of adjustment) and this clause 8.7 (Adjustments) is £100,000,000. |
8.8 | Access |
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9. | WARRANTIES AND UNDERTAKINGS |
9.1 | Warranties |
(c) | Ownership of the Shares |
(i) | The Shares set out in Schedule 1 (The Sellers) against his or its name are, as at the date of this agreement (other than the Wandl Shares), and will at Completion be, legally and beneficially owned by him or it. |
(ii) | There is, as at the date of this agreement (save in respect of any encumbrances in relation to the Junior Debt and Senior Debt), and will at Completion be, no Encumbrance on, over or affecting any of the Shares owned by such Seller and no person has, as at the date of this agreement, and will at Completion be, claimed to be entitled to any such Encumbrance. |
(d) | Capacity and consequences of sale |
(i) | It or he has the power, capacity and authority to execute and deliver this agreement and each of the other Transaction Documents to which it or he is or will be a party and to perform its or his obligations under each of them and has taken all action necessary to authorise such execution and delivery and the performance of such obligations. |
(ii) | This agreement constitutes legal, valid and binding obligations on it or him in accordance with its terms. Each of the other Transaction Documents to which it or he is or will be a party will, when executed, constitute legal, valid and binding obligations on it or him in accordance with its terms. |
(iii) | The entry by it or him into this agreement and, as applicable, into each of the other Transaction Documents to which it or he is or will be a party and the performance by it or him of its or his obligations under this agreement and each other Transaction Document does not and will not: |
(A) | conflict with or constitute a default under any provision of: |
I. | any agreement or instrument to which it, he or any person connected with it or him is a party; or |
II. | the constitutional documents of it or any person connected with it or him; or |
III. | any law, lien, lease, order, judgment, award, injunction, decree, ordinance or regulation or any other restriction of any kind or character by which it, he or any person connected with it or him is bound; or |
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(B) | result in the creation or imposition of any Encumbrance on any of the Shares owned by it or him. |
9.2 | The provisions of Schedule 4 (Limitations on Claims) shall apply to limit the liability of the Institutional Seller and the Other Sellers (as the case may be) under this agreement and no liability shall attach to the Institutional Seller or the Other Sellers in respect of any Claim in each case if, and to the extent that, any of the limitations set out in Schedule 4 (Limitations on Claims) applies, provided that the provisions of Schedule 4 (Limitations on Claims) shall not apply to any Claim against any Institutional Seller or Other Seller arising out of fraud on the part of that Institutional Seller or Other Seller. |
9.3 | The Warranties shall be deemed to be given by the Institutional Seller and the Other Sellers at the date of this agreement and again at Completion. |
10. | PURCHASER'S WARRANTIES AND UNDERTAKINGS |
(e) | the Purchaser has the power, capacity and authority to execute and deliver this agreement and each of the other Transaction Documents to which it is or will be a party and to perform its obligations under each of them and has taken all action necessary to authorise such execution and delivery and the performance of such obligations; |
(f) | this agreement constitutes, and each of the other Transaction Documents to which the Purchaser is or will be a party will, when executed, constitute legal, valid and binding obligations on the Purchaser in accordance with its terms; and |
(g) | the entry by the Purchaser into this agreement and, as applicable, into each of the other Transaction Documents to which it is or will be a party and the performance of the obligations of the Purchaser under this agreement and each other Transaction Document does not and will not conflict with or constitute a default under any provision of: |
(i) | any agreement or instrument to which the Purchaser or any person connected with the Purchaser is a party; |
(ii) | the constitutional documents of the Purchaser or any person connected with the Purchaser; or |
(iii) | any law, lien, lease, order, judgment, award, injunction, decree, ordinance or regulation or any other restriction of any kind or character by which the Purchaser or any person connected with the Purchaser is bound, subject to satisfaction of the Completion Condition. |
(h) | in connection with the entry into this agreement, the Transactions contemplated by this agreement, and/or any matter pertaining directly or indirectly to this agreement, including without limitation the negotiation of this agreement and the fulfilment of the Purchaser’s obligations hereunder, the Purchaser has not and each of its Affiliates, associated persons, agents or subcontractors as may be used in relation to the Purchaser’s fulfilment of obligations under this agreement (such persons being herein referred to as the Purchaser’s Associates) have not and the Purchaser undertakes for itself and on behalf of the Purchaser’s Associates that it or they shall not engage in or in any way induce the following conduct: making of payments or transfers of value, offers, promises or giving of any financial or other advantage, or requests, agreements to receive or acceptances of any financial or other advantage, either directly or indirectly, which have or may have the purpose or effect of public or commercial |
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11. | GUARANTOR'S WARRANTIES AND UNDERTAKINGS |
(e) | the Guarantor has the power, capacity and authority to execute and deliver this agreement and each of the other Transaction Documents to which it is or will be a party and to perform its obligations under each of them and has taken all action necessary to authorise such execution and delivery and the performance of such obligations; |
(f) | this agreement constitutes, and each of the other Transaction Documents to which the Guarantor is or will be a party will, when executed, constitute legal, valid and binding obligations on the Guarantor in accordance with its terms; and |
(g) | the entry by the Guarantor into this agreement and, as applicable, into each of the other Transaction Documents to which it is or will be a party and the performance of the obligations of the Guarantor under this agreement and each other Transaction Document does not and will not conflict with or constitute a default under any provision of: |
(i) | any agreement or instrument to which the Guarantor or any person connected with the Guarantor is a party; |
(ii) | the constitutional documents of the Guarantor or any person connected with the Guarantor; or |
(iii) | any law, lien, lease, order, judgment, award, injunction, decree, ordinance or regulation or any other restriction of any kind or character by which the Guarantor or any person connected with the Guarantor is bound, subject to satisfaction of the Completion Condition. |
12. | GUARANTEE |
12.1 | Guarantee |
(h) | guarantees to the Sellers and the Exit Bonus Payees the payment when due of all amounts payable by the Purchaser under or pursuant to this agreement; |
(i) | undertakes to ensure that the Purchaser will perform when due all its obligations under or pursuant to this agreement; |
(j) | agrees that if and each time that the Purchaser fails to make any payment when it is due under or pursuant to this agreement, the Guarantor must on demand (without requiring the Sellers or the Exit Bonus Payees first to take steps against the Purchaser or any other person) pay that amount to the Sellers and the Exit Bonus Payees as if it were the principal obligor in respect of that amount; and |
(k) | agrees as principal debtor and primary obligor to indemnify, on an after-Tax basis, the Sellers and the Exit Bonus Payees against all losses and damages sustained by any Seller, their respective Affiliates and the Exit Bonus Payees flowing from any non-payment or default of any kind by the Purchaser under or pursuant to this agreement or the unenforceability, invalidity or illegality of any of the Purchaser's obligations. |
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12.2 | Waiver of defences |
(c) | any time or indulgence granted to, or composition with, the Purchaser or any other person; |
(d) | the taking, variation, renewal or release of any right, guarantee, remedy or security from or against the Purchaser or any other person; |
(e) | neglecting to perfect or enforce this agreement against the Purchaser or any other person; |
(f) | any variation or change to the terms of this agreement; or |
(g) | any unenforceability or invalidity of any obligation of the Purchaser, so that this agreement shall be construed as if there were no such unenforceability or invalidity. |
12.3 | Subrogation |
12.4 | Costs |
13. | ANNOUNCEMENTS AND CONFIDENTIALITY |
13.1 | Restriction |
13.2 | Duration |
(d) | each of the parties shall treat as strictly confidential and not disclose or use any information received, held or obtained as a result of entering into this agreement or any of the Transaction Documents which relates to: |
(iv) | the provisions of this agreement or the Transaction Documents and any agreement entered into under them; or |
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(v) | the negotiations relating to this agreement (and any such other agreement); and |
(e) | each Seller shall, following Completion, treat as strictly confidential and not disclose or use: |
(i) | any information relating to the Group; or |
(ii) | any other information relating to the business, financial or other affairs (including future plans and targets) of the Purchaser's Group, |
13.3 | Exceptions for announcements and disclosure |
(c) | with the prior written approval of the Institutional Seller Representative, the Senior Management Representative and the Purchaser, which shall not be unreasonably withheld or delayed; |
(d) | to the extent required by law, to any court of competent jurisdiction, any stock exchange or any competent regulatory or supervisory body (including a taxation authority), provided that if a person is so required to make any announcement or to disclose any confidential information, the relevant party shall promptly notify the other parties, where practicable and lawful to do so, before the announcement is made or disclosure occurs (as the case may be) and shall co-operate with the other parties regarding the timing and content of such announcement or disclosure (as the case may be) or any action which the other parties may reasonably elect to take to challenge the validity of such requirement, including giving the Institutional Seller an opportunity to comment on the announcement. |
13.4 | Exceptions for disclosure only |
(a) | by any member of the Purchaser's Group for the time being or, after Completion, by any Group Company: |
(iv) | to the extent that the information is in or comes into the public domain otherwise than as a result of a breach of any undertaking or duty of confidentiality by any member of the Purchaser's Group for the time being or, after Completion, by any Group Company; |
(v) | to its professional advisers, auditors, investors or bankers but, before any disclosure to any such person, the Purchaser shall procure that such person is made aware of the terms of this clause 13.4 (Exceptions for disclosure only) and shall use its best endeavours to procure that such person adheres to those terms as if such person were bound by the relevant provisions of this clause 13.4 (Exceptions for disclosure only); |
(vi) | to a proposed purchaser of, or investor in, any member of the Purchaser's Group or their professional advisers, auditors or bankers but, before any disclosure to any such person, the Purchaser shall procure that such person is made aware of the terms of this clause 13.4 (Exceptions for disclosure only) and shall use its best endeavours to procure that such person adheres to those terms as if such person were bound by the relevant provisions of this clause 13 (Announcements and Confidentiality); or |
(vii) | to any provider of finance or potential provider of finance to the Purchaser's Group or any person connected with the Purchaser (or to their advisers, agents or representatives) |
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(b) | by the Institutional Seller to its Affiliates, or any fund, limited partnership or investment vehicle managed or advised by the Institutional Seller, or any actual or prospective investor in any such fund, limited partnership or investment vehicle, in each case on a confidential basis; or |
(c) | by any Seller or, on or before Completion, by any Group Company: |
(iii) | to the extent that the information is in or comes into the public domain otherwise than as a result of a breach of any undertaking or duty of confidentiality by any Seller or, on or before Completion, by any Group Company; |
(iv) | to its professional advisers, auditors or bankers but, before any disclosure to any such person, that Seller shall procure that such person is made aware of the terms of this clause 13.4 (Exceptions for disclosure only) and shall use its or his best endeavours to procure that such person adheres to those terms as if such person were bound by the relevant provisions of this clause 13.4 (Exceptions for disclosure only); or |
(v) | to any Tax authority. |
14. | NOTICES |
14.1 | Delivery |
(f) | if to the Institutional Seller, at the address specified against its name in this agreement, with a copy to: |
(g) | if to the Institutional Seller Representative, at: |
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(h) | if to a Senior Management Seller or a Manager, at the address specified against his or its name in this agreement, with a copy to: |
(i) | if to the Senior Management Representative, at: |
(j) | if to the Other Sellers, at the address specified against his or its name in this agreement, with a copy to: |
(k) | if to the Purchaser at: |
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(l) | if to the Guarantor at: |
14.2 | Time of delivery |
(e) | if delivered by hand, registered post or courier, at the time of delivery; |
(f) | if sent by post, on the second Business Day after it was put into the post; or |
(g) | if sent by fax, on the date of transmission, if transmitted before 3pm (local time in the country of destination) on any Business Day, and in any other case on the Business Day following the date of transmission. |
14.3 | Evidence of delivery |
14.4 | Service of process |
15. | FURTHER ASSURANCES |
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15.1 | Execution of documents |
15.2 | Shares held on trust |
16. | POST COMPLETION UNDERTAKINGS |
16.1 | Access |
16.2 | Payment of Exit Bonuses |
16.3 | Payment of Transaction Fees |
16.4 | Release of Institutional Seller Directors |
(a) | not bring or maintain and shall procure that no Group Company brings or maintains any claim whatsoever against any Institutional Seller Director for breach of director’s duties (including the duty to exercise reasonable care, skill and diligence) owed by any Institutional Director to any Group Company of which he was a director at any time in the period prior to Completion; and |
(b) | procure that each of the relevant Group Companies of which an Institutional Seller Director was a director at any time in the period prior to Completion shall, if requested by an Institutional Seller Director, waive, release and discharge the Institutional Seller Director in respect of any breach of director’s duties (including the duty to exercise reasonable care, skill and diligence) owed to the relevant Group Companies in the period prior to Completion, |
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17. | ASSIGNMENTS |
(a) | the Purchaser may assign (in whole or in part) the benefit of this agreement to any other member of the Purchaser's Group, provided that if such assignee ceases to be a member of the Purchaser's Group all benefits relating to this agreement assigned to such assignee shall be deemed automatically by that fact to be re-assigned to the Purchaser immediately before such cessation; and |
(b) | the Purchaser or any member of the Purchaser's Group may charge and/or assign the benefit of this agreement to any person providing debt financing and/or hedging facilities to the Purchaser or any member of the Purchaser's Group, or to any security agent or any person or persons acting as trustee, nominee or agent for any such person by way of security for the facilities being made or to be made available to the Purchaser or member of the Purchaser's Group and any such person, security agent, trustee, nominee or agent may also, in the event of enforcement of such security in accordance with its terms, assign the benefit of such obligations and rights to a purchaser or assignee who acquires the Company or all or part of its business from that person, security agent, trustee, nominee or agent (or any receiver appointed by any of them), |
18. | PAYMENTS |
18.1 | Accounts |
(a) | if that payment is to the Institutional Seller or any person connected with the Institutional Seller, the account of the Institutional Seller's Solicitors (details of which have been provided to the Purchaser's Solicitors) or such other account as the Institutional Seller Representative shall, not less than three Business Days before the date that payment is due, have specified for payments to the Institutional Seller by giving notice to the Purchaser for the purpose of that payment; |
(b) | if that payment is to any Senior Management Seller, Exit Bonus Payee or person connected with a Senior Management Seller or Exit Bonus Payee, the account of the Senior Management Sellers' Solicitors (details of which have been provided to the Purchaser's Solicitors) or such other account as the relevant Senior Management Seller or Exit Bonus Payee shall, not less than three Business Days before the date that payment is due, have specified for payments to him or it by giving notice to the Purchaser for the purpose of that payment; and |
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(c) | if that payment is to the Purchaser, such account of the Purchaser as the Purchaser shall, not less than three Business Days before the date that payment is due, have specified by giving notice to the Institutional Seller Representative and the Senior Management Representative for the purpose of that payment. |
18.2 | Payments by or to the Institutional Seller on behalf of the Sellers |
18.3 | Default interest |
18.4 | Withholdings and deductions |
18.5 | Gross up |
19. | GENERAL |
19.1 | Obligations continue post Completion |
19.2 | Several liability |
19.3 | All Sellers bound |
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19.4 | Time not of the essence |
(a) | time is expressly stated to be of the essence in relation to that obligation; or |
(b) | one party fails to perform an obligation by the time specified in this agreement and another party serves a notice on the defaulting party requiring it to perform the obligation by a specified time and stating that time is of the essence in relation to that obligation. |
19.5 | Costs |
19.6 | Transfer Taxes |
19.7 | Counterparts |
19.8 | Exercise of rights |
(a) | may be exercised as often as necessary; and |
(b) | may be waived only in writing and specifically. |
19.9 | No right to delay |
19.10 | Third party rights |
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19.11 | Successors |
19.12 | Amendments |
19.13 | Severability |
20. | WHOLE AGREEMENT |
20.1 | Whole agreement |
20.2 | No reliance |
(a) | acknowledges that in agreeing to enter into this agreement and the other Transaction Documents to which it is a party, it has not relied on any express or implied representation, warranty, collateral contract or other assurance made by or on behalf of any other party before the entering into of this agreement; and |
(b) | waives all rights and remedies which, but for this clause 20.2 (No reliance), might otherwise be available to it in respect of any such express or implied representation, warranty, collateral contract or other assurance. |
20.3 | No agency liability |
20.4 | No exclusion for fraud |
21. | INSTITUTIONAL SELLER REPRESENTATIVE |
21.1 | Functions |
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21.2 | No liability |
22. | SENIOR MANAGEMENT REPRESENTATIVE |
22.1 | Functions |
22.2 | No liability |
23. | GOVERNING LAW AND JURISDICTION |
23.1 | Governing law |
23.2 | Jurisdiction |
23.3 | Service of process |
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23.4 | Waiver of objection to English courts |
23.5 | Waiver of trial by jury |
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Name | Address | Type of Shares | Number of Shares | Percentage of Consideration |
HSBC Investment Bank Holdings plc | Level 23 8 Canada Square London E14 5HQ UK | A Ordinary Shares C Ordinary Shares Limited Participation Shares | 3,983,000 100,000 50,000 | 82.29% 2.07% 0 |
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Name | Address | Type of Shares | Number of Shares | Percentage of Consideration |
James Gaskell | Millbank Farmhouse Maryculter Aberdeen AB12 5FT, UK | C Ordinary Shares Limited Participation Shares | 75,000 37,500 | 1.55% 0 |
William John Bayliss | 7 Queen's Grove Aberdeen AB15 8HE, UK | C Ordinary Shares | 242,000 | 5% |
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Name | Address |
Adrian Bannister | 5 Queen's Grove Aberdeen AB15 8HE, UK |
Anthony Alexander | 38 Ashwood Grange Bridge of Don Aberdeen AB22 8XG, UK |
Christopher Chapman | Rosemount Milton of Arbuthnott Laurencekirk Aberdeenshire AB30 1PF, UK |
Christopher Forde | 35A Beatrice Street Doubleview Western Australia 6018, Australia |
Michael Main | 2 Kirkton Road Westhill Aberdeen AB32 6LF, UK |
Wolfgang Wandl | Melingsiden 34D 4056 Tananger Norway |
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Name | Address | Type of Shares | Number of Shares | Percentage of Consideration |
Inflexion Fund 2 Limited Partnership (acting through its general partner Inflexion Scottish Limited Partnership in turn acting through its general partner Inflexion General Partner Limited) | 9 Mandeville Place London W1U 3AY UK | B Ordinary Shares | 154,999 | 3.2% |
Inflexion Moorings Co-Investment A Limited Partnership (acting through its general partner Inflexion G.P. Limited) | 9 Mandeville Place London W1U 3AY UK | B Ordinary Shares | 145,001 | 3% |
Hugh Allan Webster | Sokak 298 No6 Camdibi Mah Marmaris Mugla 48700 Turkey | C Ordinary Shares Limited Participation Shares | 10,000 5,385 | 0.21% 0 |
Scott Allan Taylor | 26 Derberth Manor Kingswells Aberdeen AB15 8TZ UK | C Ordinary Shares Limited Participation Shares | 20,000 10,769 | 0.41% 0 |
Stephen John Curl | Rockyfield Thorns Lane Underbarrow Cumbria LA8 8BB UK | C Ordinary Shares Limited Participation Shares | 20,000 10,769 | 0.41% 0 |
LØP AS (Anne Lorup) | Ragnhildsgate 66 N-4044 Hafrsfjord Norway | C Ordinary Shares Limited Participation Shares | 15,000 8,077 | 0.31% 0 |
Moor-Tech AS (Petter Nilsen) | Lensmannskroken 19 4050 Sola Norway | C Ordinary Shares Limited Participation Shares | 75,000 37,500 | 1.55% 0 |
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Name | Venice Topco Limited |
Date of incorporation | June 3, 2009 |
Registered company number | 6,923,445 |
Registered office | 1 Park Row Leeds LS1 5AB UK |
Directors | William John Bayliss Anthony David Bernbaum Richard John Cole Donald William Featherstone Michael James Kershaw Patrick Martin Sixsmith |
Issued share capital | A Ordinary Shares: 3,983,000 B Ordinary Shares: 300,000 C Ordinary Shares: 557,000 Limited Participation Shares: 160,000 |
Shareholders | See Schedule 1 (The Sellers) |
Charges | 1. Security agreement (2010) – HSBC Investment Bank Holdings plc 2. Security agreement (2011) – HSBC Investment Bank Holdings plc 3. Bond and floating charge – HSBC Investment Bank Holdings plc 4. Debenture – DNB BANK ASA 5. Bond and floating charge – DNB BANK ASA |
Accounting reference date | 31 December |
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(a) | in respect of that Seller, a duly executed share transfer form or forms in favour of the Purchaser for the Shares held by such Seller; |
(b) | in respect of that Seller, the share certificates for the Shares held by it (or a lost certificate indemnity in a form reasonably satisfactory to the Purchaser); |
(c) | (in the case of the Institutional Seller) a notice from the Institutional Seller removing the Institutional Seller Directors under article 23(a) of the articles of association of the Company and clause 2.1 of the shareholders’ agreement of the Company (confirming that they have no claims against any Group Company); |
(d) | (in the case of the Institutional Seller) the duly executed Junior Deed of Release and the Senior Deed of Release; |
(e) | (in the case of the Institutional Seller) confirmation that it has applied the External Facilities Repayment Amount in full satisfaction of the External Facilities; and |
(f) | (in the case of the Institutional Seller) copies (duly executed by the Institutional Seller) of, in respect of each of James Gaskell and Adrian Bannister, the letter between him and the Institutional Seller, the Company and the Purchaser in respect of his Completion bonus. |
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(a) | electronically transfer to the bank account of the Institutional Seller's Solicitors the Completion Amount minus the Escrow Sum; |
(b) | procure the repayment by the Company of the External Facilities Repayment Amount; and |
(c) | electronically transfer to the Escrow Sum to the Escrow Account. |
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1. | Acknowledgement |
(a) | admits and acknowledges that it has not entered into this agreement in reliance upon any warranties, representations, covenants, undertakings, indemnities or other statements whatsoever other than those expressly set out in this agreement and the Purchaser acknowledges that the Institutional Seller and the Other Sellers have not given any other such warranties, representations, covenants, undertakings, indemnities or other statements and that no claim for any such matters may be brought against the Institutional Seller or the Other Sellers or any of them; |
(b) | agrees that (unless expressly stated otherwise) rescission or termination shall not be available as a remedy for any breach of this agreement and agrees not to claim that remedy; |
(c) | agrees that the damages payable by any Institutional Seller or Other Seller in respect of a Claim shall be calculated on a contractual basis and calculation of damages on a tortious or any other basis is hereby excluded; and |
(d) | the remedies or relief to which the Purchaser is entitled in respect of any Claim shall only be damages for breach of contract and/or an injunction against continuing or anticipated breach, and those for any tortious act of any Institutional Seller or Other Seller, including misrepresentation, negligence, other breach of duty or on any other basis, are hereby excluded. |
2. | Initial notice |
(a) | the Purchaser shall give notice to the Institutional Seller and Other Sellers in respect of all Claims specifying that fact, matter or circumstance in reasonable detail (including the Purchaser's estimate, on a without prejudice basis, of the amount of such Claim) as soon as reasonably practicable after it becomes aware of that fact, matter or circumstance. Neither the Institutional Seller or the Other Sellers shall be liable for any losses in respect of a Claim to the extent that they are increased, or are not reduced, as a result of any failure by the Purchaser to give notice as contemplated by this paragraph 2; |
(b) | the Purchaser shall (or shall procure that the Company or any other Group Company concerned shall) provide to the relevant Institutional Seller or Other Seller and their advisers reasonable access to premises and personnel and to relevant assets, documents and records within the Group Companies for the purposes of investigating the matter; and |
(c) | the relevant person or persons may take copies of the documents or records, and photograph the premises or assets, referred to in paragraph 2(b) of this schedule. |
3. | Time limit for notice |
4. | Time limit for commencing a Claim |
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5. | Financial limits |
6. | Payment of damages |
7. | Mitigation |
8. | Insurance |
9. | Contingent liabilities |
10. | Waiver of set-off rights |
11. | Remedy of breaches |
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12. | Consequential loss |
13. | No double recovery |
14. | No employee claims |
15. | Purchaser's knowledge |
(a) | is within the actual knowledge of Ted Wozniak as at the date of this agreement; |
(b) | to the extent that such fact, matter or circumstance concerns a financial matter, is within the actual knowledge of Tim Kolbeck as at the date of this agreement; |
(c) | to the extent that such fact, matter or circumstance concerns a health, safety, security or environmental matter, is within the actual knowledge of Tim Puylart as at the date of this agreement; or |
(d) | to the extent that such fact, matter or circumstance concerns a human resources or employment matter, is within the actual knowledge of Brad Davidson or Sheri Grissom as at the date of this agreement. |
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1. | GENERAL ACCOUNTING POLICIES |
1.1 | Purpose |
1.2 | Priority |
(a) | the specific accounting policies set out in paragraph 2 (Specific Accounting Policies) of this schedule; |
(b) | subject to paragraph 1.2(a), adopting the same basis of preparation as that used for, and in accordance with, the same accounting principles, policies, treatments, classifications, categorisations and practices as were applied to the Group in the preparation of the Management Accounts; and |
(c) | subject to paragraphs 1.2(a) and 1.2(b), in accordance with UK GAAP. |
2. | SPECIFIC ACCOUNTING POLICIES |
2.1 | No double counting |
2.2 | Going concern |
2.3 | Cut-off |
2.4 | Currency |
2.5 | Stock |
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2.6 | Sundry debtors |
2.7 | Sundry creditors |
2.8 | Exit Bonuses |
2.9 | Transaction Fees |
2.10 | Capex Prepayments and Capex Creditors |
(a) | Capex Prepayments (including prepayments in relation to any assets under construction) and Capex Creditors shall be excluded from the Final Working Capital (and Working Capital Estimate) and included in the Final Net Debt (and Net Debt Estimate). |
(b) | Any capex additions in relation to the Lundin Arrangements shall be treated as a reduction in Final Net Debt (and Net Debt Estimate). |
(c) | Any other assets which are capitalized on or after 30 June 2013 shall be treated as a reduction in Final Net Debt (and Net Debt Estimate). |
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2.11 | Corporation tax |
2.12 | Debt |
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Item | Reference | £ |
Enterprise Valuation | clause 1.1 (Definitions) | X |
Less: Net Debt Estimate | clause 1.1 (Definitions) | (X) |
Less: Exit Bonuses (grossed up to include the amount of employer national insurance contributions) | clause 1.1 (Definitions) and Schedule 5 (Basis of Preparation of Completion Statement and Final Completion Statement) | (X) |
Less: Transaction Fees | clause 1.1 (Definitions) | (X) |
Plus: Interim Working Capital Adjustment (if any) | clause 1.1 (Definitions) | X |
COMPLETION AMOUNT | X | |
Working Capital Estimate: | Schedule 5 (Basis of Preparation of Completion Statement and Final Completion Statement) | |
Stocks | X | |
Trade debtors | X | |
Sundry debtors | X | |
Trade creditors | (X) | |
Sundry creditors | (X) | |
Deferred income | (X) | |
Working Capital Estimate | X |
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Balance as at Effective Time | Final Net Debt | Final Working Capital | Other | |
Net tangible assets | X | X | X | |
Intangible assets | X | X | ||
Stock | X | X | X | |
Trade debtors | X | X | ||
Sundry debtors Deposits/Guarantees, Accrued Revenue, VAT/GST | X | X | X | X |
Cash | X | X | ||
Trade creditors | (X) | (X) | (X) | |
Corporation tax | X | X | ||
Sundry creditors, Songa Matter, Accruals, Payroll/Taxes | (X) | (X) | (X) | |
Loan finance − External | (X) | (X) | ||
Fair value of any interest rate hedges | (X) | |||
Deferred tax | (X) | (X) | ||
Deferred income | (X) | (X) | ||
TOTALS | X | (X) | X | X |
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Item | Reference | £ | £ |
Enterprise Valuation | clause 1.1 (Definitions) | X/(X) | |
Less: Final Net Debt | clause 1.1 (Definitions) | (X) | |
Less Exit Bonuses (grossed up to include the amount of employer national insurance contributions) | clause 1.1 (Definitions) and Schedule 5 (Basis of Preparation of Completion Statement and Final Completion Statement) | X | |
Less: Transaction Fees | clause 1.1 (Definitions) | X/(X) | |
Plus: Working Capital Adjustment under clause 8.6 (Payment of adjustment) and 8.7(Adjustments) | clause 1.1 (Definitions) | X/(X) | |
FINAL COMPLETION AMOUNT | |||
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1. | Purpose |
2. | Engagement |
3. | Initial written statement |
4. | Written response |
5. | Powers of the Independent Accountants |
(a) | be entitled to stipulate the time periods within which the Institutional Seller and the Purchaser shall prepare and submit the written statement and written comments referred to in paragraphs 3 (Initial written statement) and 4 (Written response) above (such time periods to be at least 14 days) and to disregard any written statement or comments not delivered to the Independent Accountants within the time periods so stipulated; |
(b) | be entitled to require such parties and their respective accountants to attend one or more meetings and to make enquiries of them about any matters which the Independent Accountants consider relevant; |
(c) | permit each such party to be present while oral submissions are being made by the other party; |
(d) | in the absence of agreement between the Institutional Seller and the Purchaser, be entitled to determine the procedure to be followed in undertaking their determination, insofar as the procedure is not set out herein; and |
(e) | be entitled to appoint advisers (including legal advisers) if required. |
6. | Assistance |
7. | Time |
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8. | Form of determination |
(a) | be limited to whether any arguments for the alteration to the Final Completion Statement put forward by the Purchaser are correct, and if so, what alterations should be made to correct any inaccuracy or error in the Final Completion Statement; |
(b) | be given in writing in the English language; and |
(c) | include the reasoning supporting the determination. |
9. | Determination final and binding |
10. | Role of Independent Accountants |
11. | Costs of the parties |
12. | Costs of the Independent Accountants |
13. | Retention of documents relating to dispute |
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THE PERSONS LISTED IN SCHEDULE 1 | ||
as Management Warrantors | ||
and | ||
ACTUANT ACQUISITIONS LIMITED | ||
as Purchaser | ||
WARRANTY DEED | ||
relating to: | ||
the sale and purchase of Venice Topco Limited | ||
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(1) | THE INDIVIDUALS whose names and addresses are set out in Schedule 1 (together the Management Warrantors); and |
(2) | ACTUANT ACQUISITIONS LIMITED (registered in England and Wales with number 7633576) whose registered office is at Unit 601, Axcess 10 Business Park, Bentley Road South, Darlaston, West Midlands, WS10 8LQ, England (the Purchaser). |
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1. | Definitions and Interpretation |
1.1 | In this Deed: |
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1.2 | Headings in this Deed shall not affect its interpretation. |
1.3 | Unless otherwise specified or the context otherwise requires, in this Deed: |
(a) | reference to clauses, Schedules or Appendices are references to clauses, schedules and appendices of this Deed and references to parts and paragraphs are to parts and paragraphs of the relevant Schedule; |
(b) | a person shall be deemed to include references to all forms of legal entity, including a natural person, a body corporate, a partnership, an association, an organisation and a trust (in each case whether or not having a separate legal personality), but references to individuals shall be deemed to be references to natural persons only; |
(c) | a company is a reference to a company within the meaning of section 1 of the Act; |
(d) | a subsidiary or holding company is a reference to those terms within their respective meanings set out in section 1159 of the Act; |
(e) | words denoting the singular shall include the plural and vice versa; |
(f) | words denoting one gender shall include each gender and all genders; |
(g) | reference to a statute or statutory instrument or accounting standard or regulations (where the context so admits and unless otherwise expressly provided) shall be construed as a reference to that statute or statutory instrument or accounting standard or regulations as amended, consolidated, extended or |
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(h) | reference to writing or written includes any methods of representing words in a legible form (other than writing on an electronic or visual display screen) or other writing in non-transitory form; |
(i) | reference to party or parties is to a party or the parties to this Deed and includes their respective successors in title, estates and legal personal representatives; |
(j) | the words include and including are to be construed as being by way of illustration or emphasis only and are not to be construed so as to limit the generality of any words preceding them; |
(k) | the words other and otherwise are not to be construed as being limited by the words preceding them; |
(l) | reference to a document is a reference to the document whether in paper or electronic form as amended, varied, supplemented or novated, in each case, other than in breach of the provisions of this Deed; |
(m) | reference to a day (including within the expression Business Day) shall mean a period of twenty-four (24) hours running from midnight to midnight; |
(n) | reference to the time of day is a reference to United Kingdom time; |
(o) | references to £ or pounds sterling are references to the lawful currency for the time being of the United Kingdom; |
(p) | any English legal term for any action, remedy, procedure, judicial proceeding, legal document, legal status or legal concept is, in respect of any jurisdiction other than England and Wales, deemed to include what most nearly approximates in that jurisdiction to the English legal term and any reference to an English statute shall be construed so as to include the equivalent or analogous laws of any other jurisdiction; and |
(q) | a person shall be deemed connected with another if that person is connected with that other within the meaning of sections 1122 and 1123 of the Corporation Tax Act 2010 (other than sections 1122(4) and 1122(7)), except that no Management Warrantor shall be connected with the Purchaser or any Group Company, nor shall any Management Warrantor be connected with any other Management Warrantor (or a connected person of another Management Warrantor) by virtue of the transactions contemplated by this Deed or the Share Purchase Agreement or being a holder of Shares in the Company. |
1.4 | Words and expressions defined in the Act shall have the same meanings wherever used in this Deed, unless such words and expressions are expressly defined in this Deed or the context otherwise requires. |
1.5 | Unless expressly stated otherwise, all warranties, representations, agreements and obligations expressed to be given or entered into by more than one person are given or |
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1.6 | References to persons procuring the doing of any act, matter or thing are references to persons doing such act, matter or thing as far as they are legally able, including by exercising voting rights, appointing or removing Directors, passing resolutions, giving consents or approvals, executing documents or otherwise (and procure and procurement shall be construed accordingly). |
2. | Consideration |
3. | Warranties |
3.1 | Each of the Management Warrantors individually and severally (and thus not jointly or jointly and severally) warrants to, and for the benefit of, the Purchaser (and the Purchaser's successors in title) at the date of this Deed in the terms set out in Schedule 3 (Warranties). The Warranties shall not in any respect be extinguished or affected by Completion. |
3.2 | The Warranties shall be deemed to be repeated at Completion (and, accordingly, references to “the date of this Deed” in Schedule 3 (Warranties) shall be deemed to be references to “Completion”). The Management Warrantors shall only be required, however, to deliver the register which is referred to in the Warranty contained in paragraph 3.1 of Schedule 3 as at the Business Day immediately preceding the date of this Deed and not again as at the Business Day immediately preceding Completion. |
3.3 | Where a Warranty is expressly qualified by the knowledge, information, belief or awareness of the Management Warrantors, that Warranty is deemed to include a statement that such knowledge, information, belief or awareness (and for the purposes of paragraph 11.2 of Schedule 3 only, is deemed to include those facts matters and circumstances of which the Management Warrantors ought reasonably to be aware) has been acquired after reasonable enquiries by the Management Warrantors of each other and of Wolfgang Wandl. |
3.4 | Each of the Warranties is separate and, unless otherwise specifically provided, is not limited by reference to any other Warranty or any other provision in this Deed. |
3.5 | The Management Warrantors agree that any information supplied to them or their advisors in connection with the Warranties, the information Disclosed or otherwise by, or on behalf of: |
(a) | any member of the Group; or |
(b) | any of the employees, contractors, directors, agents or other representative of any member of the Group (Officers), |
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3.6.1 | All sums payable to the Purchaser under this Deed shall be paid without any rights of counterclaim or set-off and free and clear of all deductions or withholdings of any kind, save only as may be required by law. Should a deduction or withholding in respect of Tax be required by law to be made by any Management Warrantor from any such payment, the deduction or withholding in respect of Tax shall be made in the minimum amount required by law and that Management Warrantor (i) shall provide such evidence of the relevant deduction or withholding as the Purchaser may reasonably require and (ii) shall pay to the Purchaser such sum as will, after the deduction or withholding in respect of Tax has been made, leave the Purchaser with the same amount as the Purchaser would have received had no deduction or withholding been made. |
3.6.2 | If any sum payable by a Management Seller to the Purchaser under this Deed (a Payment) is subject to Tax in the hands of the Purchaser, that Management Seller shall pay such additional amount as shall ensure that the net amount received by the Purchaser shall be the amount that the Purchaser would have received if the Payment had not been subject to Tax. |
3.6.3 | If the Purchaser would, but for the availability of a Purchaser’s Relief (as defined in Schedule 5 (Tax)), incur a Tax liability falling within Clause 3.6.2, it shall be deemed for the purposes of that Clause to have incurred and paid that liability. |
3.6.4 | It is intended by the parties that any Payment will fall within section 13 ('Indemnity Payments') of HM Revenue and Customs’ Extra-Statutory Concession D33 (D33). No Management Seller shall be liable to pay any additional amount under Clause 3.6.2 to the extent that such payment does not fall within D33 as a direct result of any voluntary act of the Purchaser (including any assignment of its rights under this Deed or the Share Purchase Agreement) following Completion. |
3.7 | The provisions of Schedule 4 (Limitations on Claims) and Schedule 5 (Tax) shall apply to limit the liability of the Management Warrantors under this Deed, save that the provisions of Schedule 4 (Limitations on Claims) and Schedule 5 (Tax) shall not apply in respect of any Claim against a Management Warrantor arising out of fraud on the part of that Management Warrantor. |
3.8 | The Warranties are qualified to the extent of those matters Disclosed in the Disclosure Letter or Disclosed in any of the Disclosure Documents. The Warranties are also qualified to the extent of any matters Disclosed in the Supplemental Disclosure Letter, save where such matter occurred prior to the date of this Deed. |
3.9 | In the case of a breach of any Tax Warranty contained in paragraph 18.1, 18.2, 18.5, 18.8 or 18.18 only of Schedule 5, the Management Warrantors shall (subject to the |
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3.10 | Any payment to be made under Clause 3.9 shall be made (i) within 15 Business Days from the date on which notice setting out the amount due is served on the Management Warrantors by the Purchaser or (ii), if later, on the date that is 15 Business Days before the last date on which the payment by the relevant Group Company of the relevant Tax may be made in order to avoid it incurring a liability to interest and penalties. |
3.11 | A reference in a Fundamental Warranty to "Management Warrantor", "Management Warrantors", "its", "it", "him" or "he" shall be deemed to be a reference only to the relevant Management Warrantor giving the relevant Fundamental Warranty and not to any other person. |
3.12 | William John Bayliss warrants to the Purchaser that, at the time of the acquisition by him of the Bayliss Shares and save for under the articles of association for the time being of the Company or the Shareholders’ Agreement, there were no arrangements between the Company and William John Bayliss in relation to the Bayliss Shares, nor were any such arrangements likely to come into existence, in either case that had the effect of enabling William John Bayliss (or any member of his family or household) to obtain an amount or total amount of money that was, or was likely to be, similar to the expense incurred in the provision of the Bayliss Shares. |
3.13 | Notwithstanding any other provision in this Deed, the warranty given by William John Bayliss in Clause 3.12 will not be qualified by any matters Disclosed in the Disclosure Letter or Disclosed in any of the Disclosure Documents, nor shall such warranty be qualified to any extent by any matters Disclosed in the Supplemental Disclosure Letter. |
4. | Tax |
5. | WW Moor AS |
5.1 | The provisions of Schedule 7 (Covenant by WW Moor AS) apply in this Deed with effect from Completion. |
5.2 | Wolfgang Wandl acknowledges and agrees with the Purchaser that he is the sole shareholder in WW Moor AS and, in that capacity, he shall procure the due and punctual performance of WW Moor AS's obligations under this Deed, (including, but not limited to, under the provisions of Schedule 7) including any payment obligation. |
6. | Notice |
6.1 | A notice given under this Deed shall be: |
(a) | in writing; |
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(b) | in the English language; and |
(c) | delivered personally or sent by post (and commercial courier if overseas) to the party due to receive the notice to the address set out in Clause 6.2 or to an alternative postal address or person specified by that party by not less than five (5) Business Days’ written notice to the other parties received before the notice was dispatched. |
6.2 | The postal addresses for service of notice are: |
(c) | in the case of any Management Warrantor, to the address specified against his or its name in Schedule 1, with a copy to the Management Warrantors' Solicitors, FAO Roger Hart. |
(d) | in the case of the Purchaser, to the address specified on page 1 of this Deed, with a copy to each of: |
(1) | Actuant Corporation, N86 W12500 Westbrook Crossing, Menomonee Falls, Wisconsin 53051, United States of America, FAO Ted Wozniak. |
(2) | Purchaser’s Solicitors, FAO Russell Van Praagh. |
6.3 | If a notice has been properly sent or delivered in accordance with this Clause 6, it shall be deemed to have been received as follows: |
(a) | if delivered personally, at the time of delivery; |
(b) | if sent by post, 48 hours after the time of posting; and |
(c) | if delivered by commercial courier, at the time of signature of the courier’s delivery receipt. |
6.4 | If deemed receipt under Clause 6.3 is not within business hours (meaning 9.00am to 5.30pm Monday to Friday on a Relevant Day) it shall be deemed to have been served at 9.00am on the next Relevant Day. For the purposes of this Clause 6.4, a Relevant Day means a day other than a Saturday or a Sunday or a day which is a public holiday at the postal address of the receiving party and any reference to a time is a time at the postal address of the receiving party. |
6.5 | No notice shall be validly served under this Deed by any means save as set out in Clause 6.1(c). |
7. | Third party rights |
7.1 | Any person to whom any rights of a party are validly assigned in accordance with Clause 9 may rely on and enforce such rights. |
7.2 | Unless expressly stated otherwise, a person who is not a party to this Deed shall not have any rights under or in connection with it by virtue of the Contracts (Rights of Third Parties) Act 1999 and no term is enforceable under the Contracts (Rights of Third Parties) Act 1999 by any such person. |
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7.3 | The right of the parties to terminate, rescind or agree any amendment, variation, waiver or settlement under this Deed is not subject to the consent of any person that is not a party to this Deed and, accordingly, section 2(1) of the Contracts (Rights of Third Parties) Act 1999 shall not apply. |
8. | Entire agreement |
8.1 | This Deed and the other Transaction Documents, and any agreements or documents referred to in this Deed or any other Transaction Document or executed contemporaneously with this Deed or such other Transaction Document, constitute the whole agreement between the parties about the subject matter of this Deed and supersede all previous arrangements, understandings and agreements between them, whether oral or written, relating to such subject matter. |
8.2 | Each party acknowledges that, in entering into this Deed and the other Transaction Documents, it does not rely on, and shall have no remedy in respect of, any express or implied representation or warranty or undertaking (whether made innocently or negligently) that is not set out in this Deed or in any of the other Transaction Documents. |
8.3 | Nothing in Clauses 8.1 and 8.2 shall limit or exclude the liability of any party for fraud or fraudulent misrepresentation by him or it. |
9. | Assignment |
9.1 | Subject to Clauses 9.2, 9.3 and 9.4, no person may assign, or grant any Encumbrance over or deal in any way with, any of its rights, benefits or obligations under this Deed or any other Transaction Document without the prior written consent of each other party. |
9.2 | The Purchaser may assign all or any of its rights and benefits under this Deed to any member of the Purchaser's Group (each a Permitted Assignee) provided that if such Permitted Assignee ceases to be member of the Purchaser’s Group, the Permitted Assignee shall assign the rights and benefits assigned to it by the Purchaser to the Purchaser or a member of the Purchaser's Group immediately prior to ceasing to be a member of the Purchaser's Group. |
9.3 | The Purchaser or any Permitted Assignee may assign all or any of its rights and benefits under this Deed to any incoming third party purchaser of all or part of the Business (including shares in any Group Company). |
9.4 | A Management Warrantor's liability under this Deed shall be no greater following an assignment than it would have been to the Purchaser had the Deed not been assigned. |
10. | Bonus Agreements, Contracts of Employment and further assurance |
10.1 | On Completion: |
10.1.1 | each Management Warrantor (excluding WW Moor AS) and Wolfgang Wandl shall duly execute his respective Bonus Agreement and Contract of Employment and deliver the same to the Purchaser; and |
10.1.2 | the Purchaser shall procure that the Company shall duly execute each of the Bonus Agreements and Contract of Employments and deliver the same to the Management Warrantors (excluding WW Moor AS) and Wolfgang Wandl. |
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10.2 | Each party shall promptly execute and deliver all such documents, and do all such things, as the other party may from time to time reasonably require for the purpose of giving full effect to the provisions of this Deed. |
11. | Costs |
12. | Miscellaneous |
12.1 | The parties to this Deed are not in partnership with each other and there is no relationship of principal and agent between them. |
12.2 | A variation of this Deed shall be in writing and signed by or on behalf of all parties. |
12.3 | A waiver of any right under this Deed shall only be effective if it is in writing and shall apply only to the person to which the waiver is addressed and the circumstances for which it is given. |
12.4 | A person that waives a right in relation to one person, or takes or fails to take any action against that person, does not affect its rights against any other person. |
12.5 | No failure to exercise or delay in exercising any right or remedy provided under this Deed or by Applicable Law constitutes a waiver of such right or remedy or shall prevent any future exercise in whole or in part thereof. |
12.6 | No single or partial exercise of any right or remedy under this Deed shall preclude or restrict the further exercise of any such right or remedy. |
12.7 | Unless specifically provided otherwise, rights and remedies arising under this Deed are cumulative and do not exclude rights and remedies provided by Applicable Law. |
12.8 | If any provision of this Deed (or part of a provision) is found by any Competent Authority to be invalid, unenforceable or illegal, the other provisions shall remain in force and unaffected. |
12.9 | If any invalid, unenforceable or illegal provision would be valid, enforceable or legal if some part of it were deleted or modified, the provision shall apply with whatever modification is necessary to give effect to the commercial intention of the parties. |
12.10 | This Deed may be executed in any number of counterparts, each of which is an original and which together have the same effect as if each party had signed the same document. |
12.11 | This Deed (other than obligations that have already been fully performed) remains in full force notwithstanding Completion and the rights of each party in respect of this Deed and shall not be affected by Completion. |
13. | Governing law and jurisdiction |
13.1 | This Deed and any disputes or claims arising out of or in connection with its subject matter or formation (including non-contractual disputes or claims) shall be governed by, and construed in accordance with, English law. |
DM_US 46029553-1.065322.0122 |
13.2 | The parties irrevocably agree that the courts of England and Wales shall have exclusive jurisdiction to settle any dispute or claim that arises out of or in connection with this Deed or its subject matter or formation (including non-contractual disputes or claims). The parties irrevocably submit to such jurisdiction and waive any objection to it on the ground of inconvenient forum or otherwise. No party shall oppose the recognition or enforcement of a judgment, order or decision of the courts of England and Wales in respect of any such dispute or claim by the courts of any state which, under the laws and rules applicable to that state, are competent or able to grant such recognition or enforcement. |
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Name | Address |
WW Moor AS | Melingsiden 34D 4056 Tananger Norway |
James Gaskell | Millbank Farmhouse Maryculter Aberdeen AB12 5FT UK |
William John Bayliss | 7 Queen's Grove Aberdeen AB15 8HE UK |
Adrian Bannister | 5 Queen's Grove Aberdeen AB15 8HE UK |
Anthony Alexander | 38 Ashwood Grange Bridge of Don Aberdeen AB22 8XG |
Christopher Chapman | Rosemount Milton of Arbuthnott Laurencekirk Aberdeenshire AB30 1PF |
Christopher Forde | 35A Beatrice Street Doubleview Western Australia 6018 |
Michael Main | 2 Kirkton Road Westhill Aberdeen AB32 6LF |
Name | Venice Topco Limited |
Date of incorporation | June 3, 2009 |
Registered company number | 6,923,445 |
Registered office | 1 Park Row Leeds LS1 5AB UK |
Directors | William John Bayliss Anthony David Bernbaum Richard John Cole Donald William Featherstone Michael James Kershaw Patrick Martin Sixsmith |
Issued share capital | A Ordinary Shares: 3,983,000 B Ordinary Shares: 300,000 C Ordinary Shares: 557,000 Limited Participation Shares: 160,000 Deferred Shares: 9,409,219,923 |
Shareholders | See Schedule 1 of the Share Purchase Agreement |
Charges | 1. Security agreement (2010) – HSBC Investment Bank Holdings plc 2. Security agreement (2011) – HSBC Investment Bank Holdings plc 3. Bond and floating charge – HSBC Investment Bank Holdings plc 4. Debenture – DNB BANK ASA 5. Bond and floating charge – DNB BANK ASA |
Accounting reference date | 31 December |
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Name | Venice Fundco Limited |
Registered address | 1 Park Row, Leeds, LS1 5AB |
Issued share capital | 1,170,000 Ordinary Shares |
Shareholder(s) | Venice Topco Limited |
Directors | (1) James Gaskell (2) William John Bayliss (3) Adrian Bannister (4) Chris Chapman |
Name | Viking SeaTech People (UK) Limited |
Registered address | 1 Park Row, Leeds, LS1 5AB |
Issued share capital | 1 Ordinary Share |
Shareholder(s) | Venice Fundco Limited |
Directors | (1) James Gaskell (2) William John Bayliss (3) Chris Chapman |
Name | Viking SeaTech Limited |
Registered address | 1 Albyn Terrace, Aberdeen, AB10 1YP |
Issued share capital | 800,000 A Ordinary Shares 200,000 B Ordinary Shares |
Shareholder(s) | Venice Fundco Limited |
Directors | (1) James Gaskell (2) Adrian Bannister (3) William John Bayliss (4) Mike Main |
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Name | Viking Moorings Holdings Limited |
Registered address | 1 Park Row, Leeds, LS1 5AB |
Issued share capital | 125,000 Ordinary Shares |
Shareholder(s) | Venice Fundco Limited |
Directors | (1) James Gaskell (2) Adrian Bannister (3) William John Bayliss |
Name | Viking Moorings Group Limited |
Registered address | 1 Park Row, Leeds, LS1 5AB |
Issued share capital | 260,000 Ordinary Shares |
Shareholder(s) | Viking SeaTech Holdings Limited |
Directors | (1) James Gaskell (2) Adrian Bannister (3) William John Bayliss |
Name | Viking SeaTech Holdings AS |
Registered address | Tangen 11, 4070 RANDABERG, Norway |
Issued share capital | NOK 1 000 000 denominated on 1 000 000 shares each with a par value of NOK 1 |
Shareholder(s) | Venice Fundco Limited |
Directors | (1) William John Bayliss (2) Wolfgang Wandl (3) James Richard Gaskell |
Name | Viking SeaTech Group AS |
Registered address | Tangen 11, 4070 RANDABERG, Norway |
Issued share capital | NOK 2 800 000 denominated on 2 800 000 shares each with a par value of NOK 1 |
Shareholder(s) | Viking SeaTech Holdings AS |
Directors | (1) William John Bayliss (2) Wolfgang Wandl |
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Name | Viking SeaTech Norge AS |
Registered address | Tangen 11, 4070 RANDABERG, Norway |
Issued share capital | NOK 500 denominated on 500 shares each with a par value of NOK 1 |
Shareholder(s) | Viking SeaTech Group AS |
Directors | (1) William John Bayliss (2) Wolfgang Wandl (3) James Richard Gaskell |
Name | Viking SeaTech Holdings (Singapore) Pte Limited |
Registered address | 80 Robinson Road, #02-00, Singapore 068898 |
Issued share capital | 1 ordinary share |
Shareholder(s) | Venice Fundco Limited |
Directors | (1) William John Bayliss; (2) Adrian John Bannister; (3) Christopher Michael Forde; (4) Jamie Martin Scoringe; and (5) Eddie Teoh Siah Hai |
Name | Viking SeaTech (Singapore) Pte Limited |
Registered address | 80 Robinson Road, #02-00, Singapore 068898 |
Issued share capital | 1 ordinary share |
Shareholder(s) | Viking SeaTech Holdings (Singapore) Pte. Limited |
Directors | (1) William John Bayliss; (2) Adrian John Bannister; (3) Christopher Michael Forde; (4) Jamie Martin Scoringe; and (5) Eddie Teoh Siah Hai |
DM_US 46029553-1.065322.0122 | 20 |
Name | Viking SeaTech People (Singapore) Pte Limited |
Registered address | 80 Robinson Road, #02-00, Singapore 068898 |
Issued share capital | 1 ordinary share |
Shareholder(s) | Viking SeaTech Holdings (Singapore) Pte. Limited |
Directors | (1) William John Bayliss; (2) James Richard Gaskell; (3) Adrian John Bannister; (4) Christopher Michael Forde; (5) Jamie Martin Scoringe; and (6) Gabriel Soh Lee Swee |
Name | Viking SeaTech (Australia) Pty Limited |
Registered address | M Squaered & Associates Pty Ltd, 40 Churchill Avenue, Subiaco Western Australia 6008 |
Issued share capital | 1 Ordinary Share (Issued) |
Shareholder(s) | Viking Moorings Ltd (of Peterseat Drive, Peterseat Park Altens, Aberdeen AB123HT, United Kingdom) |
Directors | (1) William John Bayliss; (2) Adrian Bannister; (3) Christopher Michael Forde; and (4) Jamie Martin Scoringe |
Name | PT Viking SeaTech Indonesia |
Registered address | Gedung Sovereign Plaza, 21st Fl., Jl. TB Simatupang Kav. 36, RT.002/02, Sub district of Cilandak Barat, District of Cilandak, Jakarta Selatan, Indonesia |
Issued share capital | 261,250 Class A Shares 13,750 Class B Shares |
Shareholder(s) | Venice Fundco Limited : 261,250 Class A Shares Mr. Jose Dima Satria: 13,750 Class B Shares |
Director(s) | Christopher Michael Forde |
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1. | Financial matters |
1.1 | The accounting reference date of each Group Company is and has at all times during the last five years been 31 December. |
1.2 | Since 31 December 2012: |
(a) | the Group's business has been carried on in its ordinary course and in substantially the same manner as immediately before 31 December 2012; |
(b) | no loan or loan capital has been repaid by any Group Company in whole or in part or has become liable to be so repaid; and |
(c) | no Group Company has declared, paid or made any dividend or other distribution. |
1.3 | Full details of all: |
(a) | overdraft, loan and other financial facilities available to the Group; and |
(b) | agreements or arrangements for hire in or rent in by any Group Company, hire-purchase by any Group Company or conditional sale to or purchase by any Group Company by way of credit or instalment payment to which any Group Company is a party (each a Lease Agreement), save for Small Lease Agreements, |
2. | The Business, trading and disposals |
2.1 | There is no agreement to which any Group Company is party which significantly restricts the fields in which it may carry on its business. |
2.2 | Save in the normal course of its business, no Group Company is party to any confidentiality or secrecy agreement or undertaking which may restrict its use or disclosure of any information. |
2.3 | No substantial part of the Business is carried on under the agreement or consent of a third party. |
2.4 | No Group Company is party to any agreement which: |
(a) | is not on arm's length terms; |
(b) | is outside the ordinary course of the Group Company's business; |
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(c) | imposes any commitment on the Group Company to obtain or supply goods or services exclusively from or to any person; |
(d) | contains any commitment for the supply or purchase of goods or services where the supply, purchase or delivery may take place more than 12 months after the time of fixing of the price; |
(e) | is incapable of termination by the Group Company in accordance with its terms on no more than 12 months' notice; or |
(f) | gives the other party an option to acquire or dispose of any asset or requires the Group Company to do so. |
3. | Assets |
3.1 | The Group keeps a register of the fixed assets owned and used by it in the Business which is up-to-date as at the Business Day immediately preceding the date of this Deed (Fixed Assets), and a copy of that register is contained in the Disclosure Documents. |
3.2 | Save for assets held under Lease Agreements or Small Lease Agreements or subject to Permitted Security Interests, the Fixed Assets are the property of the Group free from any Encumbrance. In this paragraph, Permitted Security Interest means: |
(a) | any unpaid vendor's or supplier's lien arising in the ordinary course of the Business in order to secure amounts which are due to be paid by the relevant Group Company for goods or services sold or supplied (but, for the avoidance of doubt, are not overdue amounts); and |
(b) | liens arising by operation of law, including a banker's lien. |
3.3 | All assets necessary for the operation or conduct of the businesses of the Group Companies are, in the aggregate, in adequate operating condition and repair, normal wear and tear excepted, other than machinery and equipment which as at the date of this Deed: |
(g) | is under repair or out of service in the ordinary course of business and is not, in the aggregate, material to the Business; |
(h) | is out on hire to a customer; or |
(i) | has been returned to the relevant Group Company from hire to a customer, but in respect of which an inspection has not yet been completed by or on behalf of the Group. |
3.4 | No material fixed assets included in the Accounts have been disposed of by any Group Company since 1 January 2013 otherwise than in the ordinary course of business. |
4. | Directors and employees |
4.1 | There is a schedule contained in the Disclosure Documents showing the following information in relation to each Key Employee: |
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(c) | name of employee; |
(d) | date of birth; |
(e) | job description; |
(f) | emoluments (including any bonus or commission arrangements and any non-cash benefits); |
(g) | date of commencement of employment or of any previous employment with which such employment is continuous; |
(h) | notice period required to be given by the employer Group Company and the employee; |
(i) | whether or not a member of any of the Pension Schemes; |
(j) | (other than a Key Employee who is employed in Norway) whether or not a member of a trade union; and |
(k) | date of last increase in salary. |
4.2 | Copies of a representative sample of the contracts of employment between each relevant Group Company and each of its employees is contained in the Disclosure Documents. |
4.3 | A copy of any consultancy agreement is contained in the Disclosure Documents. In this paragraph, consultancy agreement means an agreement entered into between any Group Company and an independent contractor either in his or her own individual name or via his or her service company pursuant to which he or she is engaged to provide specific services to the Group Company. |
4.4 | Since 31 December 2012, no material change has been made by any Group Company to the terms of employment of any of its directors or any Key Employee. |
4.5 | Since 31 December 2012, no director of any Group Company or Key Employee has given notice terminating his contract of employment or is under notice of dismissal. |
4.6 | No amount due to or in respect of any employee or former employee is in arrear and unpaid other than his salary for the month current and in respect of the reimbursement of expenses. |
4.7 | No Group Company is involved in any material dispute with any of its directors or Key Employees, and so far as the Management Warrantors are aware, there are no present circumstances (excluding Completion) which are likely to give rise to any such dispute. |
4.8 | There is no existing, and no Group Company has received notice or is otherwise on notice of, any dispute between any Group Company and any material number or category of its employees or any trade union or other organisation formed for a similar purpose. |
4.9 | There is no collective bargaining agreement or other arrangement (whether binding or not) between any Group Company and any trade union or other body representing its employees. |
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4.10 | No Group Company has or is proposing to introduce any share incentive scheme, share option scheme or profit sharing bonus or other incentive scheme for any director, officer or employee. |
5. | Pension arrangements |
6. | Information technology |
6.1 | The Group does not use any computer software other than standard off-the-shelf packages generally available to the public (Standard Software), and no Standard Software used by the Group has been materially modified. |
6.2 | A Group Company possesses all necessary licences with respect to its use of Standard Software and no material licence terms have been breached by any Group Company. |
(a) | So far as the Management Warrantors are aware, each Group Company has complied in all material respects with the Data Protection Act 1998 and the Privacy and Electronic Communications (EC Directive) Regulations 2003 (together, the Data Protection Laws). |
(b) | No Group Company has received a notice or allegation from any relevant data protection supervisory authority, a data subject or other individual alleging non-compliance with the Data Protection Laws. |
7. | Intellectual property |
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7.1 | The Company IPR is in full force and effect and not subject to any application for cancellation, amendment, licence of right or compulsory licence. |
7.2 | No item of Company IPR is the subject of a claim or opposition from any person as to title, validity, enforceability or entitlement and no Group Company has received notice or is otherwise on notice of litigation or other proceedings (whether legal or administrative) which involve any of the Company IPR or, so far as the Management Warrantors are aware, any circumstances likely to give rise to any such proceedings. |
7.3 | All application, renewal and other official statutory and regulatory fees rendered to and received by any Group Company before the date of this Deed relating to the administration of the Company IPR or for the protection or enforcement of the Company IPR have been duly paid and all reasonable and prudent steps have been taken for their maintenance and protection. |
7.4 | Since 31 December 2012, no Group Company has sold or otherwise disposed of any Intellectual Property owned or used by the Group. |
7.5 | So far as the Management Warrantors are aware, no Group Company has infringed the Intellectual Property of any other person and no Group Company has received written notice of any such infringement. |
7.6 | There is, and within the past 12 months there has been, no actual or, so far as the Management Warrantors are aware, threatened infringement (including misuse of confidential information) or, so far as the Management Warrantors are aware, any event likely to constitute an infringement or breach by any third party of any of the Company IPR. |
7.7 | No Group Company has granted, or is obliged to grant, to any person any licence of any Intellectual Property owned by it or licensed to it. |
8. | Property matters and interests in land |
8.1 | The Group Company does not own, nor is it in occupation of nor is it entitled to any estate or interest in, any freehold or leasehold property other than the Properties. No Group Company is party to any uncompleted agreement to acquire or to dispose of any freehold or leasehold property. |
8.2 | The title deeds to the Properties are in a Group Company's possession. |
8.3 | Except in relation to the Properties, no Group Company has any liability (whether actual or contingent) in relation to any leasehold or freehold property. |
8.4 | In the case of a Property in which a Group Company has a leasehold interest, the Group Company has, subject to the terms of the relevant lease or applicable law, good and marketable title to the tenant's interest in that Property without exception or reservation. |
8.5 | All outgoings payable by a Group Company under the terms documenting its occupancy of the Properties have been paid to date, including rent, service charge and insurance and no written notice of any alleged breach or non-observance of any of the terms of any such occupancy document has been received by any Group Company and, so far as the Management Warrantors |
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9. | Litigation, disputes and investigations |
9.1 | Apart from (if relevant) the collection of debts in the ordinary course of the Business (involving debts of not more than £10,000 in any individual case or £100,000 across the Group in aggregate), no Group Company is engaged in any capacity in any litigation, arbitration, prosecution or other legal proceedings or alternative dispute resolution or in any proceedings or hearings before any Authority; no such matters are, so far as the Management Warrantors are aware, pending or threatened. |
9.2 | There is no outstanding judgment, order, decree, arbitral or mediation award or decision of any court, tribunal, arbitrator or Authority against any Group Company. |
10. | Insurance |
10.1 | Particulars of all insurance policies maintained by the Group Company immediately before the date of this Deed or in respect of which it has an insured interest immediately before the date of this Deed (Policies) are contained in the Disclosure Letter. |
10.2 | All premiums due from the Group Companies in respect of the Policies have been paid. |
10.3 | No single claim exceeding £50,000 is outstanding either by the insurer or the insured under any of the Policies. |
10.4 | Details of all material claims made by any Group Company under any insurance policy in the last two years are set out in the Disclosure Letter. |
11. | Compliance and regulatory |
11.1 | So far as the Management Warrantors are aware, each Group Company has conducted its business in accordance with the requirements of all Applicable Laws (including, without limitation, Competition Laws) and has not been and is not being investigated for any alleged non-compliance with or infringement of such Applicable Laws (including, without limitation, Competition Laws). |
11.2 | So far as the Management Warrantors are aware, each Group Company has conducted its business, in all material respects, in accordance with the requirements of all Applicable Laws (including, without limitation, Competition Laws). |
11.3 | No Group Company is subject to any prohibition, order, condition, undertaking, assurance or similar measure or obligation imposed by or under any Applicable Law (including, without limitation, Competition Law). |
(a) | The Group has obtained all material authorities, permits, licences and consents required for or in connection with the carrying on of the Business in the places and in the manner in which the Business is now carried on including without limitation in relation to environmental matters; |
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(b) | such authorities are in full force; and |
(c) | so far as the Management Warrantors are aware, there are no circumstances which indicate that any such authorities will be revoked or not renewed. |
11.5 | All registers and minute books required by law to be kept by each Group Company have, in all material respects, been properly written up and the Group Company has not received any written application or request for rectification of its statutory registers or any notice or allegation that any of them is incorrect. |
11.6 | No Group Company has received written notice that it is in violation of, or in default with respect to, any statute or regulation, order, decree or judgment of any court or any governmental agency of the jurisdiction in which it is incorporated which could have a material adverse effect upon its business. |
12. | Constitutional |
12.1 | The Company is a private company limited by shares duly incorporated in England and Wales. |
12.2 | The Shares constitute the entire issued share capital of Venice Topco Limited. |
12.3 | The information in Schedule 2 (Company Details) is accurate in all material respects. |
12.4 | Save as disclosed in Schedule 2 (Company Details), no Group Company has any: |
(a) | interest in the share capital of, or other investment in, any body corporate; |
(b) | interest in any partnership, joint venture, consortium or other unincorporated association or arrangement for sharing profit or losses; or |
(c) | branch, agency, place of business or permanent establishment outside the United Kingdom or substantial assets outside the United Kingdom. |
12.5 | No share or loan capital of any Group Company is now under option or is agreed or resolved conditionally or unconditionally to be created or issued or put under option. |
13. | Accounts receivable |
14. | Environmental matters |
14.1 | None of the Group Companies has received any written notice alleging any violation of, non-compliance with, liability pursuant to or potential responsibility for remediation pursuant to any environmental laws, which matter remains unresolved and so far as the Management Warrantors are aware no such notice is threatened in writing. |
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14.2 | No hazardous material has been transported, stored, treated or disposed of by the Group Companies, except as would not reasonably be expected to result in an environmental liability of a Group Company. |
14.3 | So far as the Management Warrantors are aware and except as in compliance with environmental laws and regulations, there has been no disposal or release by or at the direction of any Group Company of any hazardous materials. |
14.4 | No Group Company has entered into, agreed to, or is subject to any order under any environmental laws. |
15. | Product warranty and liability |
15.1 | Except as is implied by statute, no Group Company is responsible for any express or implied warranties or indemnities in connection with the sale or distribution of any products or services. |
15.2 | Except to the extent reserved against in the Accounts, no Group Company has received any written notifications of any claims arising out of any injury to any person or property with respect to the ownership, possession or use of any product manufactured, sold, distributed, leased or delivered by a Group Company prior to the date of this Deed not fully covered by insurance and, so far as the Management Warrantors are aware, there are no circumstances in existence which are reasonably likely to give rise to such a claim. |
15.3 | The Disclosure Documents contain the standard terms and conditions of sale used by the Group. |
16. | Undisclosed liabilities |
17. | Brokers |
18. | Tax Warranties |
18.1 | All notices, returns (including any stamp duty land tax land transaction returns), reports, accounts, computations, statements, assessments, claims, disclaimers, elections and registrations and any other necessary information which are required by law to have been submitted by the Company or any Subsidiary to any Tax Authority for the purposes of Taxation in the Warranted Period have been submitted within applicable time limits and were accurate and complete in all material respects. None of the above is the subject of any material dispute with any Tax Authority. |
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18.2 | All Taxation (whether of the UK or elsewhere), for which the Company or any Subsidiary has been or become liable within the Warranted Period, has been duly paid (insofar as such Taxation has fallen due) by the due dates and no penalties, fines, surcharges or interest have been incurred. |
18.3 | The Company and each Subsidiary maintains materially complete and accurate records, invoices and other information in relation to Taxation, that meet all legal requirements. |
18.4 | The Disclosure Letter discloses whether or not the Company or any Subsidiary is a large company within the meaning of regulation 3 of the Corporation Tax (Instalment Payment) Regulations 1998 (SI 1998/3175). |
18.5 | All amounts in respect of Taxation (including where applicable national insurance contributions) deductible within the Warranted Period under the PAYE system, the Construction Industry Scheme and/or any other Taxation Statute have, so far as is required by law to be deducted, been deducted from all payments made (or treated as made) by the Company or any Subsidiary. All such deducted amounts due to be paid to the relevant Tax Authority on or before the date of this agreement and within the Warranted Period have been so paid. |
18.6 | The Disclosure Letter contains details of any payments or loans made to, any assets made available or transferred to, or any assets earmarked, in each case, within the Warranted Period, however informally, for the benefit of, any employee or former employee (or any associate of such employee or former employee) of the Company or any Subsidiary by an employee benefit trust or another third party, and which fall within the provisions of Part 7A to ITEPA 2003. |
18.7 | The Disclosure Letter contains details of all concessions, agreements and arrangements of which the Management Warrantors are aware that the Company of any Subsidiary has entered into in the Warranted Period with a Tax Authority. |
18.8 | Neither the Company nor any Subsidiary has, in the Warranted Period, become liable to make to any person (including any Tax Authority) any payment in respect of any liability to Taxation which is primarily or directly chargeable against, or attributable to, any other person (other than the Company or any Subsidiary). |
18.9 | So far as the Management Warrantors are aware, the Accounts provide for Taxation of the Company and its Subsidiaries in accordance with UK GAAP. |
18.10 | No distribution or deemed distribution, within the meaning of section 1000 or sections 1022-1027 of CTA 2010, has been made (or will be deemed to have been made) within the Warranted Period, by the Company or any Subsidiary, except dividends shown in their statutory accounts, and neither the Company nor any Subsidiary is bound to make any such distribution. |
18.11 | Neither the Company nor any Subsidiary has, within the Warranted Period, been engaged in, nor been a party to, any of the transactions set out in Chapter 5 of Part 23 of CTA 2010 (demergers). |
18.12 | All financing costs, including interest, discounts and premiums payable by the Company or any Subsidiary in respect of its loan relationships within the meaning of Chapter 8 of Part 5 of CTA |
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18.13 | Any loans or advances made, or agreed to be made in the Warranted Period, by the Company or any Subsidiary within sections 455, 459 and 460 of CTA 2010 have been disclosed in the Disclosure Letter. Neither the Company nor any Subsidiary has, in the Warranted Period, released or written off, or agreed to release or write off, the whole or any part of any such loans or advances. |
18.14 | Neither the Company nor any Subsidiary has, in the Warranted Period, been party to any arrangements pursuant to sections 59F-G of TMA 1970 (group payment arrangements). |
18.15 | The Company and the Subsidiaries have, throughout the Warranted Period, been resident in the UK for corporation tax purposes and have not, at any time in that period, been treated as resident in any other jurisdiction for the purposes of any double taxation arrangements. |
18.16 | Neither the Company nor any Subsidiary holds, or within the Warranted Period has held, shares in a company which is not resident in the UK, a material interest in an offshore fund, or a permanent establishment outside the UK. |
18.17 | All transactions and arrangements made by the Company or any Subsidiary in the Warranted Period have been made on arms length terms and the processes by which prices and terms have been arrived at have in each case been documented to the extent required by law. No notice, enquiry or adjustment has been made by any Tax Authority in connection with any such transactions or arrangements. |
18.18 | So far as the Management Warrantors are aware, neither the Company nor any Subsidiary has been involved, during the Warranted Period, in any transaction or series of transactions the main purpose, or one of the main purposes of which was the avoidance of tax or any transaction that produced a tax loss with no corresponding commercial loss. |
18.19 | No asset owned by the Company or any Subsidiary, nor the Shares, is subject to any Inland Revenue charge as mentioned in sections 237 and 238 of IHTA 1984 or is liable to be subject to any sale, mortgage or charge by virtue of section 212(1) of IHTA 1984. |
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18.20 | The Company and the Subsidiaries which are required to be registered under VATA are so registered for the purposes of VAT as members of the same group of companies for the purposes of section 43 VATA 1994 with quarterly prescribed accounting periods. |
18.21 | All supplies made by the Company or any Subsidiary are taxable supplies. Neither the Company nor any Subsidiary has been, in the Warranted Period, denied full credit for all input tax paid or suffered by it. |
18.22 | Any document that may be necessary in proving the title of the Company or any Subsidiary to any asset which is owned by the Company or any Subsidiary at Completion, and which is required to have been stamped for such purpose has been duly stamped for stamp duty purposes. No such documents which are outside the UK would attract stamp duty if they were brought into the UK. |
18.23 | So far as the Management Warrantors are aware, neither entering into this agreement nor Completion will result in the withdrawal of any stamp duty or stamp duty land tax relief granted on or before Completion which will affect the Company or any Subsidiary. |
18.24 | Neither the Company nor any Subsidiary is required by law to register as a Contractor under the provisions of section 59 of the Finance Act 2004. |
19. | Fundamental Warranties |
19.1 | The Shares (if any) set out in schedule 1 to the Share Purchase Agreement against his or its name are, as at the date of this Deed, and will at Completion be, legally and beneficially owned by him or it. |
19.2 | There is, as at the date of this Deed, and will at Completion be, no Encumbrance on, over or affecting any of the Shares (if any) owned by such Management Warrantor, and no person has, before the date of this Deed, claimed, or will, at Completion, be entitled to, any such Encumbrance. |
19.3 | It or he has the power, capacity and authority to execute and deliver this Deed and each of the other Transaction Documents to which it or he is or will be a party and to perform its or his obligations under each of them and has taken all action necessary to authorise such execution and delivery and the performance of such obligations. |
19.4 | This Deed constitutes legal, valid and binding obligations on it or him in accordance with its terms. Each of the other Transaction Documents to which it or he is or will be a party will, when executed, constitute legal, valid and binding obligations on it or him in accordance with its terms. |
19.5 | The entry by it or him into this Deed and, as applicable, into each of the other Transaction Documents to which it or he is or will be a party and the performance by it or him of its or his obligations under this Deed and each other Transaction Document does not and will not: |
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(i) | any agreement or instrument to which it, he or any person connected with it or him is a party; or |
(ii) | the constitutional documents of it or any person connected with it or him; or |
(iii) | any law, lien, lease, order, judgment, award, injunction, decree, ordinance or regulation or any other restriction of any kind or character by which it, he or any person connected with it or him is bound; or |
(b) | result in the creation or imposition of any Encumbrance on any of the Shares owned by it or him. |
1. | Acknowledgement |
(c) | admits and acknowledges that it has not entered into this Deed in reliance upon any warranties, representations, covenants, undertakings, indemnities or other statements whatsoever other than those expressly set out in this Deed and the Share Purchase Agreement, and the Purchaser acknowledges that the Management Warrantors have not given any other such warranties, representations, covenants, undertakings, indemnities, or other statements and that no claim for any such matters may be brought against the Management Warrantors or any of them; |
(d) | agrees that (save for any WW Moor AS Tax Claim and save as expressly stated in Clause 3.9 of this Deed) damages payable by any Management Warrantor in respect of a Claim shall be calculated on a contractual basis and calculation of damages on a tortious or any other basis is hereby excluded; and |
(e) | agrees that (save as expressly stated otherwise (including, without limitation, any WW Moor AS Tax Claim and as stated in Clause 3.9 of this Deed)) the remedies or relief to which the Purchaser is entitled in respect of any Claim shall only be damages for breach of contract and/or an injunction against continuing or anticipated breach, and those for any tortious act of any Management Warrantor, including misrepresentation, negligence, other breach of duty or on any other basis, are hereby excluded. |
2. | Initial notice and conduct of Claims |
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(j) | the Purchaser shall give notice to the Management Warrantors specifying that fact, matter or circumstance in reasonable detail (including the Purchaser's estimate, on a without prejudice basis, of the amount of such claim) as soon as reasonably practicable after it becomes aware of such fact, matter or circumstance; |
(k) | the Purchaser shall (or shall procure that the Company or any other Group Company concerned shall) provide to the Management Warrantors and their advisers reasonable access to premises and personnel and to relevant assets, documents and records within the Group Companies; |
(l) | the relevant person or persons may take copies of the documents or records, and photograph the premises or assets, referred to in paragraph 2(b) of this schedule at its expense; and |
(m) | where the fact, matter or circumstances which may give rise to such claim is, or may involve, a claim or potential claim by a third party against the Purchaser or any Group Company (a Third Party Claim), then the Management Warrantors, upon written indemnification of the Purchaser’s Group in respect of all costs and expenses arising as a result of such conduct, shall have conduct of such claim and the Purchaser shall (and shall procure that the Group Company concerned shall) take all such action and give all such information and assistance in connection with the affairs of the Purchaser or the Group Company concerned as the Management Warrantors may reasonably request in writing to negotiate, avoid, dispute, resist, mitigate, compromise, defend or appeal against that Third Party Claim. PROVIDED THAT nothing in this paragraph 2(d) shall require the Purchaser or any other member of the Purchaser’s Group to take or refrain from taking any action which it reasonably considers would materially and adversely affect the goodwill or bona fide commercial interests of the Purchaser's Group. |
3. | Time limit for notice |
3.5 | The Management Warrantors shall not be liable in respect of any Commercial Warranty Claim or Tax Warranty Claim unless written notice of it is given by the Purchaser: |
(a) | in the case of a Commercial Warranty Claim, to the Management Warrantors by no later than 31 December 2014 and in accordance with paragraph 2 of this Schedule; and |
(b) | in the case of a Tax Warranty Claim, to the Management Warrantors by no later than the fourth anniversary of the Completion Date. |
3.6 | WW Moor AS shall not be liable in respect of any WW Moor AS Tax Claim unless written notice of it is given by the Purchaser to WW Moor AS by no later than 1 January 2024. |
3.7 | William John Bayliss shall not be liable in respect of any Bayliss Warranty Claim unless written notice of it is given by the Purchaser to William John Bayliss by no later than the second anniversary of the Completion Date. |
4. | Time limit for commencing a Commercial Warranty Claim |
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5. | Financial limits |
(n) | No amount shall be payable by any Management Warrantor in respect of any Commercial Warranty Claim unless: |
(i) | the amount of the aggregate cumulative liability of the Management Warrantors in respect of such Commercial Warranty Claim exceeds £15,000 (such Commercial Warranty Claim being an Eligible Commercial Warranty Claim); and |
(ii) | the aggregate cumulative liability of the Management Warrantors in respect of all Eligible Commercial Warranty Claims exceeds £150,000 (in which event the Management Warrantors shall be liable for the whole of such liability and not merely for the excess). |
(o) | No amount shall be payable by any Management Warrantor in respect of any Tax Warranty Claim unless the amount of the aggregate cumulative liability of the Management Warrantors in respect of such Tax Warranty Claim exceeds £15,000. |
(p) | The maximum aggregate liability of a Management Warrantor in respect of all Commercial Warranty Claims and Tax Warranty Claims (and, in the case of William John Bayliss, Bayliss Warranty Claims) shall be limited to the amount stated opposite his or its name below: |
(i) | William John Bayliss £268,000, less the amount of any Bayliss Deduction; |
(ii) | WW Moor AS £203,000; |
(iii) | James Gaskell £116,000; |
(iv) | Adrian Bannister £49,000; |
(v) | Anthony Alexander £24,000; |
(vi) | Christopher Chapman £26,000; |
(vii) | Christopher Forde £48,000; and |
(viii) | Michael Main £16,000. |
(q) | The maximum aggregate liability of a Management Warrantor in respect of all Fundamental Warranty Claims and Share Purchase Agreement Title Claims shall be limited to 100% of the Consideration which is actually received by him or it. The |
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(r) | Paragraphs 5(c) and (d) above are not to be aggregated. Notwithstanding the provisions of those paragraphs, the maximum aggregate liability of a Management Warrantor in respect of all Claims shall not in any circumstances exceed 100% of the Consideration which is actually received by him or it. |
(s) | The liability of a Management Warrantor in respect of a Commercial Warranty Claim or a Tax Warranty Claim shall be limited to that Management Warrantor's proportion of the amount of that Commercial Warranty Claim or Tax Warranty Claim. In this paragraph, the Management Warrantors' respective proportions of any Commercial Warranty Claim or Tax Warranty Claim shall be the respective amounts set out opposite their names below: |
(ii) | William John Bayliss 35.7%; |
(iii) | WW Moor AS 27.1%; |
(iv) | James Gaskell 15.4%; |
(v) | Adrian Bannister 6.5%; |
(vi) | Anthony Alexander 3.2%; |
(vii) | Christopher Chapman 3.5%; |
(viii) | Christopher Forde 6.4%; and |
(ix) | Michael Main 2.2%. |
6. | Limitations |
6.4 | No Commercial Warranty Claim shall be admissible and the Management Warrantors shall not be liable in respect of any Commercial Warranty Claim: |
(a) | to the extent that such claim has been or is made good or is otherwise compensated for to the Purchaser (otherwise than by the Purchaser), less any cost to the Purchaser in obtaining such compensation; |
(b) | notwithstanding the provisions of paragraph 9 (Claims against third parties and recovery), to the extent that the matter to which it relates is actually recovered by the Purchaser or any member of the Purchaser's Group from insurers; |
(c) | to the extent that specific provision has been made in respect of the matter giving rise to such claim in the Accounts, the Management Accounts or in the Final Completion Statement (as defined in, and which is agreed, deemed agreed or determined in accordance with, the Share Purchase Agreement); |
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(d) | to the extent such claim arises from or is increased as a result of any legislation or other binding regulatory provision not in force at Completion which takes retrospective effect; or |
(e) | to the extent that such liability occurs, arises or is increased as a result of, or is otherwise attributable to, any voluntary or discretionary act, transaction or omission of (i) the Purchaser or any other member of the Purchaser's Group or their respective directors, employees or agents or (ii) any Group Company (to the extent directed by the Purchaser or any other member of the Purchaser’s Group or their respective directors, employees or agents), in each case on or after Completion. |
7. | Payment of damages |
8. | Mitigation |
9. | Claims against third parties and recovery |
10. | No double recovery |
11. | Contingent liabilities |
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12. | Purchaser’s knowledge |
12.6 | The Management Warrantors will not be liable for any Commercial Warranty Claim to the extent that such claim arises directly out of or in connection with any fact, matter or circumstance which: |
(a) | is within the actual knowledge of Ted Wozniak as at the date of this Deed; |
(b) | to the extent that such fact, matter or circumstance concerns a financial matter, is within the actual knowledge of Tim Kolbeck as at the date of this Deed; |
(c) | to the extent that such fact, matter or circumstance concerns a health, safety, security or environmental matter, is within the actual knowledge of Tim Puylart as at the date of this Deed; or |
(d) | to the extent that such fact, matter or circumstance concerns a human resources or employment matter, is within the actual knowledge of Brad Davison or Sheri Grissom as at the date of this Deed. |
13. | Set-off |
13.1 | The Purchaser waives any and all rights of set-off, counterclaim, deduction or retention against or in respect of any payment obligation which it has in favour of any Management Warrantor, save that the Purchaser may set-off: |
13.2 | In paragraph 13.1: |
(d) | Determined Claim means a Claim by the Purchaser against the Set-off Management Warrantor which is validly notified in writing to that Set-off Management Warrantor pursuant to paragraph 3 of this Schedule before the date on which the Purchaser Bonus Obligation is otherwise required to be satisfied and which is either: |
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(i) | agreed by the Set-off Management Warrantor and the Purchaser in writing (including agreement on the quantum of such Claim); or |
(ii) | adjudged final by any judgment or settlement order, that judgment or order being incapable of appeal or the Set-off Management Warrantor having elected in writing not to appeal, or any time period for appeal having expired without the relevant right of appeal having been validly exercised, |
(e) | Undetermined Claim means a Claim by the Purchaser against the Set-off Management Warrantor which is validly notified in writing to that Set-off Management Warrantor pursuant to paragraph 3 of this Schedule before the date on which the Purchaser Bonus Obligation is otherwise required to be satisfied and: |
(ii) | in respect of which a barrister of at least 7 years' call and having experience in the area of law relevant to that Claim and being appointed (at the cost and expense as such barrister may direct having regard to the respective conduct of the parties) either by agreement between the Set-off Management Warrantor and the Purchaser or, failing agreement within two Business Days after request for agreement by the Purchaser, on the application of the Purchaser to the chairman for the time being of the Bar Council of England and Wales (or its successor body), has given a written opinion addressed to the Purchaser and the Set-off Management Warrantor confirming (A) that, in the opinion of such barrister, the Purchaser has, on the balance of probabilities, reasonable prospects of succeeding with that Claim in a court of law in England and (B) the barrister's estimate of the amount which, on the balance of probabilities, the Purchaser has reasonable prospects of recovering in a court of law in England in respect of that Claim (such amount being the Opined Liability). |
1 | Interpretation |
1.1 | In this schedule (unless the context otherwise requires): |
(a) | any Relief (including the right to a repayment of Tax) that has been shown as an asset in the Management Accounts or Final Completion Statement; and |
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(b) | any Relief that has been taken into account in computing (and so reducing or eliminating) any provision for deferred Tax in the Management Accounts or Final Completion Statement |
(c) | any Relief, whenever arising, of the Purchaser or any member of the Purchaser's Tax Group other than the Company |
2 | Limitations |
2.1 | The Management Warrantors shall not be liable for breach of any Tax Warranty in respect of any liability in respect of Taxation to the extent that: |
(a) | specific provision or reserve (other than a provision for deferred tax) is made for such liability in the Management Accounts or Final Completion Statement; or |
(b) | such liability was discharged on or before Completion and such discharge was taken into account in the preparation of the Management Accounts or Final Completion Statement; or |
(c) | any Relief that is not a Purchaser’s Relief is available (or is made available at no cost to the relevant Group Company) to the relevant Group Company to reduce or eliminate the Taxation liability; or |
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(d) | such liability would not have arisen but for a voluntary transaction, action or omission carried out or effected by any member of the Purchaser's Group or a Group Company at any time after Completion where the Purchaser was aware or ought reasonably to have been aware would give rise to such liability except that this exclusion shall not apply where such transaction, action or omission: |
(i) | is required by any legislation or other statutory requirement (whether coming into force before, on or after Completion) or for the purpose of avoiding or mitigating a penalty imposable by any such legislation; or |
(ii) | is carried out or effected pursuant to a legally binding obligation of the relevant Group Company entered into on or before Completion; or |
(iii) | is carried out at the written request of the Management Warrantors; or |
(iv) | is carried out in the ordinary course of business of the relevant Group Company; or |
(e) | such liability arises or is increased as a result of: |
(i) | any change in the rates of Taxation; or |
(ii) | any change in legislation, regulation or directive; or |
(iii) | any change in the published practice of general application of, or published concession of general application operated by, any Tax Authority; |
(iv) | any change in the interpretation of any law, based on case law; |
(f) | such liability arises as a result of a change to the date to which a Group Company makes up its accounts or a Group Company changing any of its accounting policies or practices, in either case, after Completion, but excluding any change required to comply with any law or generally accepted accounting practices or principles applicable to the relevant Group Company; or |
(g) | such liability arises as a result of or would not have arisen but for the earning, receipt or accrual of any income, profit or gain prior to Completion which is not recognised (but should properly have been recognised) in the Management Accounts or Final Completion Statement (and is not otherwise reflected in the price paid by the Purchaser for the Shares); or |
(h) | the Purchaser has recovered damages or any other amount under this Deed, the Share Purchase Agreement (whether for breach of Warranty or otherwise) or otherwise in respect of the same liability or to the extent the Purchaser or a Group Company has |
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(i) | such liability is a liability for Tax arising in relation to: |
(i) | any Exit Bonus paid to an Exit Bonus Payee pursuant to the terms of the relevant Exit Bonus Letter; or |
(ii) | the bonuses to be paid to Adrian Bannister and James Gaskell pursuant to the Adrian Bannister Exit Bonus Letter or, as the case may be, the James Gaskell Exit Bonus Letter; or |
(j) | such liability is a liability arising in respect of or as a result of the matters relating to monies lent by certain Group Companies incorporated in Norway to certain Group Companies incorporated in the UK referred to in the disclosure against Tax Warranty 18.2; or |
(k) | such liability is actually recovered by any member of the Purchaser's Group or any Group Company from insurers. |
3 | Conduct of claims |
3.1 | If the Purchaser or a Group Company (or any of their officers or employees) become aware of any Demand which will or is likely to give rise to a liability of the Management Warrantors in respect of the Tax Warranties the Purchaser shall give written notice thereof to the Management Warrantors. The Purchaser shall give such notice to the Management Warrantors on a timely basis (having regard to any applicable time limit for appealing against or responding to the Demand) provided that where a statutory time limit is applicable for responding to or appealing against the Demand, the Purchaser shall give written notice of the Demand to the Management Warrantors no later than the tenth Business Day prior to the expiry of the said time limit, to the extent reasonably practicable. |
3.2 | If the Management Warrantors become aware of a Demand (other than by notice given by the Purchaser), they shall notify the Purchaser in writing as soon as reasonably practicable, and, on receipt of such notice, the Purchaser shall be deemed to have given the Management Warrantors notice of the Demand in accordance with the provisions of paragraph 3.1. |
3.3 | The Purchaser shall procure that the relevant Group Company shall take such action which the Management Warrantors may (by written notice given to the Purchaser) reasonably request to dispute, resist, appeal against, compromise, defend a Demand (any such action being an Action), provided always that: |
(a) | in each case, the Purchaser and the relevant Group Company shall first be indemnified to the Purchaser's reasonable satisfaction by the Management Warrantors against all liabilities, costs, damages or expenses (including any additional liability in respect of |
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(b) | the Purchaser and the relevant Group Company shall not be obliged to comply with any request of the Management Warrantors which involves appealing, or otherwise taking any action in respect of, any Demand beyond the first appellate body (excluding the Tax Authority which has made the Demand in question, the statutory pre-tribunal review and the Tax Chamber of the First-tier Tribunal) unless the Management Warrantors (at their sole cost and expense) furnish the Purchaser with the written opinion of Tax Counsel of at least ten years’ call who is experienced in the subject matter of the Demand to the effect that there is a reasonable prospect that the appeal in respect of the matter in question will succeed; |
(c) | the Purchaser shall not be obliged to take any Action in relation to a Demand where any Tax Authority alleges in writing (which allegation is not withdrawn) fraudulent conduct or conduct involving dishonesty has been committed by the Management Warrantors or, prior to Completion, the relevant Group Company in relation to such Demand. |
3.4 | If: |
(a) | within 15 Business Days of having given written notice to the Management Warrantors of a Demand, the Purchaser does not receive from the Management Warrantors written instructions to take any Action in relation to the Demand; or |
(b) | the Management Warrantors fail to indemnify the Purchaser or the relevant Group Company to the Purchaser’s reasonable satisfaction within a period of time (commencing with the date of the notice given to the Management Warrantors) that is reasonable having regard to the nature of the Demand and the existence of any time limit in relation to disputing, resisting, appealing against, compromising, or defending such Demand, and which period will not in any event exceed a period of 15 Business Days; or |
(c) | any Tax Authority alleges in writing that fraudulent conduct or conduct involving dishonesty has been committed by the Management Warrantors or, prior to Completion, the relevant Group Company in relation to such Demand, and such allegation is not withdrawn after the Management Warrantors have had a reasonable opportunity to challenge it; or |
(d) | at any time after the Management Warrantors have given to the Buyer written notice pursuant to paragraph 4.3 requesting any Action to be taken: |
(i) | that Action has been taken or the Purchaser or Group Company is not obliged to take that Action by virtue of the provisions of paragraph 3.3(b), but the Demand (and Taxation liability which is the subject of the Demand) remain outstanding; |
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(ii) | the Purchaser has given written notice to the Management Warrantors notifying them that paragraph 3.4(d)(i) applies; and |
(iii) | the Management Warrantors fail to reasonably request further Action within a period of 15 Business Days following the notification referred to in paragraph 3.4(d)(ii) |
3.5 | Subject to compliance by the Management Warrantors with paragraph 3.2 and where the Management Warrantors request that the Purchaser take, or procure that the relevant Group Company takes, any Action referred to in paragraph 3.2, the Purchaser undertakes to the Management Warrantors to: |
(a) | keep the Management Warrantors reasonably informed of all matters relating to the Action and deliver to the Management Warrantors copies of all material correspondence relating to the Action; |
(b) | obtain the prior written approval of the Management Warrantors (not to be unreasonably withheld or unreasonably delayed) to the content and sending of written communications relating to the Action to a Tax Authority; and |
(c) | obtain the prior written approval of the Management Warrantors (not to be unreasonably withheld or unreasonably delayed) to: |
(iv) | the settlement or compromise of the Demand which is the subject of the Action; and |
(v) | the agreement of any matter in the conduct of the Action which is likely to affect the amount of the Demand. |
4 | Windfall Reliefs |
4.1 | If, on or before 31 January 2016, the Management Warrantors request (by written notice to the Purchaser) that the Purchaser require the auditors for the time being of the relevant Group Company (the Auditors) to determine (at the sole expense of the Management Warrantors) as experts and not as arbitrators that: |
(a) | any Taxation liability (or the event giving rise to the Taxation liability) which has resulted in any sum having been paid by the Management Warrantors in respect of the Tax Warranties has given rise to a Relief (not including an Accounts Relief) which would not otherwise have arisen and a liability of a Group Company make an actual payment Taxation has been eliminated, or a repayment of Tax has been obtained, by the use of |
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(b) | any Taxation liability which arises or would otherwise have arisen (other than one which would otherwise have given rise to a corresponding liability of the Management Warrantors in respect of the Tax Warranties) is eliminated or reduced or any repayment of an amount of Taxation is obtained in either case by the use of a Sellers' Relief, and, if the Auditors so determine, the amount of Taxation so saved or the amount of that repayment (as the case may be) shall be dealt with in accordance with paragraph 4.2. |
4.2 | Where it is provided under paragraph 4.1 that any amount is to be dealt with in accordance with this paragraph 4.2: |
(d) | the amount shall first be set off against any payment then due from the Management Warrantors in respect of the Tax Warranties; |
(e) | to the extent there is an excess, a refund (net of any reasonable costs and expenses incurred by the Purchaser) shall be made to the Management Warrantors of any previous payment made by the Management Warrantors in respect of the Tax Warranties and not previously refunded under this paragraph 5, up to the amount of such excess; and |
(f) | to the extent that the excess referred to in paragraph 4.2(b) is not exhausted thereunder, the remainder of that excess shall be carried forward and set off against any future payment which becomes due from the Management Warrantors in respect of the Tax Warranties. |
4.3 | The Purchaser shall notify the Management Warrantors in writing within 10 Business Days of it or a Group Company receiving a determination of the Auditors as referred to in paragraph 4.1. |
5 | Tax computations |
5.1 | Subject to this paragraph 5, the Purchaser will have exclusive conduct of all Taxation affairs of the Company and any Group Company after Completion. |
5.2 | The Purchaser covenants with the Management Warrantors: |
(e) | to keep the Management Warrantors and their duly authorised agents reasonably informed of all material matters relating to the Taxation affairs in respect of any accounting period ended on or before Completion for which final agreement with the relevant Tax Authority of the amount of Taxation due from the relevant Group Company has not been reached; |
(f) | that no written communications shall be transmitted to any Tax Authority in respect of the matters mentioned in paragraph 5.2(a) above without first being submitted to the |
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5.3 | The Management Warrantors shall be under no obligation to procure the signing and/or authorisation of any document delivered to them under this paragraph which they reasonably consider, to be false, misleading, incomplete or inaccurate in any respect. |
5.4 | In respect of the accounting periods of each Group Company commencing prior to Completion and ending after Completion (Straddle Period) the Purchaser shall procure that the corporation tax returns of each Group Company shall be prepared on the basis which is consistent with the manner in which corporation tax returns of the relevant Group Company are or have been prepared for all accounting periods ended prior to Completion. |
5.5 | The Purchaser shall procure that each Group Company keeps the Management Warrantors reasonably informed of the Taxation affairs of the relevant Group Company in respect of the Straddle Period (to the extent that they are relevant to the pre-Completion period) and shall provide the Management Warrantors with copies of all relevant documents and shall not submit any correspondence to, or agree any return or computation for such period with, any Tax Authority without giving the Management Warrantors a reasonable opportunity to make reasonable representations thereon and without the written consent of the Management Warrantors (such consent not to be unreasonably withheld or unreasonably delayed). |
5.6 | The Purchaser shall procure that the relevant Group Company provides the Management Warrantors with such documents and information (including, without limitation, access to books, accounts. personnel and records), as the Management Warrantors may reasonably require in writing, in connection with their rights pursuant to this paragraph 5. |
5.7 | The Management Warrantors shall provide the Purchaser or the relevant Group Company with such documents and information relating to the Taxation affairs of the Company in the pre-Completion period (including, without limitation, access to books, accounts. personnel and records) as the Management Warrantors have in their possession or control and as the Purchaser or the relevant Group Company may reasonably require in writing, in connection with their rights pursuant to this paragraph 5 |
5.8 | The provisions of paragraph 3 shall apply in priority to the provisions of this paragraph 5. |
5.9 | The provisions of this paragraph 5 shall not prejudice the rights of the Purchaser to make a claim under this Agreement in respect of any liability for Taxation. |
6 | Rebates |
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Trade mark number | Type | Classes | Trademark text | Status | Applicant |
2622688 | National | 06, 22,035, 37, 39 & 42 | Viking SeaTech | Registered | Venice Topco Limited |
2415017 | National | 37 & 42 | Viking Moorings Total Mooring Solutions | Registered | Viking Moorings Limited |
201004388 | National | 35, 37, 39 & 42 | LET'S CONNECT | Registered | Viking Moorings Norge AS |
200803304 | National | 37 & 42 | Viking Moorings | Registered | Viking Moorings Norge AS |
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Application number | Patent details | Applicant |
20100175 | Method and device for docking maritime ships | Viking Moorings AS |
20101589 | Improved device and method for anchoring | Viking Moorings AS |
WO2011NO00042 | Improved device and method for forming an anchor spread | Viking Moorings AS |
2011216605 | Improved device and method for forming an anchor spread | Viking Seatech Norge AS |
1 | In this Schedule, the following terms have the respective meanings given in Schedule 5 (Tax): Accounts Relief, Demand, Dispute, Purchaser’s Relief, Purchaser’s Tax Group, Relief and Seller’s Relief. |
2 | WW Moor AS shall pay to the Purchaser an amount equal to any payment of Taxation for which a Group Company is liable in connection with the WW Moor AS Share Purchase Agreement. |
3 | WW Moor AS shall not be liable under paragraph 2 of this Schedule for any liability in respect of Taxation to the extent that: |
(g) | any Relief that is not a Purchaser’s Relief is available (or is made available at no cost to the relevant Group Company) to the relevant Group Company to reduce or eliminate the Taxation liability; or |
(h) | such liability would not have arisen but for a voluntary transaction, action or omission carried out or effected by any member of the Purchaser's Group or a Group Company at any time after Completion where the Purchaser was aware or ought reasonably to have been aware would give rise to such liability except that this exclusion shall not apply where such transaction, action or omission: |
(i) | is required by any legislation or other statutory requirement (whether coming into force before, on or after Completion) or for the purpose of avoiding or mitigating a penalty imposable by any such legislation; or |
(ii) | is carried out or effected pursuant to a legally binding obligation of the relevant Group Company entered into on or before Completion; or |
(iii) | is carried out at the written request of WW Moor AS or Wolfgang Wandl; or |
(iv) | is carried out in the ordinary course of business of the relevant Group Company; or |
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(i) | such liability arises or is increased as a result of: |
(i) | any change in the rates of Taxation; or |
(ii) | any change in legislation, regulation or directive; or |
(iii) | any change in the published practice of general application of, or published concession of general application operated by, any Tax Authority; |
(iv) | any change in the interpretation of any law, based on case law; |
(j) | such liability arises as a result of a change to the date to which a Group Company makes up its accounts or a Group Company changing any of its accounting policies or practices, in either case, after Completion, but excluding any change required to comply with any law or generally accepted accounting practices or principles applicable to the relevant Group Company; or |
(k) | the Purchaser has recovered damages or any other amount under this Deed, the Share Purchase Agreement (whether for breach of Warranty or otherwise) or otherwise in respect of the same liability or to the extent the Purchaser or a Group Company has otherwise obtained reimbursement or restitution from any of the Sellers in respect of the same liability; or |
(l) | such liability is actually recovered by any member of the Purchaser's Group or any Group Company from insurers. |
4 | The provisions of paragraphs 3 (Conduct of Claims), 4 (Windfall Reliefs) and 6 (Rebates) of Schedule 5 (Tax) shall apply to this Schedule, with any reference to: |
▪ | “the Management Warrantors” being read as a reference to “WW Moor AS”; |
▪ | “the Tax Warranties” being read as a reference to “paragraph 2 of Schedule 7 (Covenant by WW Moor AS)”; |
▪ | “Tax Warranty Claim” being read as a reference to “WW Moor AS Tax Claim”; and |
▪ | “31 January 2016” in paragraph 4.2 of Schedule 5 being read as a reference to “31 January 2024”. |
DM_US 46029553-1.065322.0122 | 49 |
DM_US 46029553-1.065322.0122 | 50 |
DM_US 46029553-1.065322.0122 | 51 |
ARTICLE I DEFINITIONS | 1 | |||
1.1 | Defined Terms | 1 | ||
1.2 | Terms Generally | 30 | ||
1.3 | Amendment and Restatement of the Existing Credit Agreement | 30 | ||
ARTICLE II THE CREDITS | 32 | |||
2.1 | Revolving Loans | 32 | ||
2.2 | Term Loans | 32 | ||
2.3 | Ratable Loans; Types of Advances | 33 | ||
2.4 | Swing Line Loans | 34 | ||
2.5 | Commitment Fee; Reduction in Aggregate Revolving Loan Commitment; Expansion Option | 35 | ||
2.6 | Commitment Fee; Reduction in Aggregate Revolving Loan Commitment; Expansion Option | 38 | ||
2.7 | Prepayments; Termination. | 38 | ||
2.8 | Method of Selecting Types and Interest Periods for New Advances; Funding of Advances | 40 | ||
2.9 | Conversion and Continuation of Outstanding Advances | 41 | ||
2.10 | Changes in Interest Rate, etc | 42 | ||
2.11 | Rates Applicable After Default | 42 | ||
2.12 | Method of Payment | 42 | ||
2.13 | Noteless Agreement; Evidence of Indebtedness | 43 | ||
2.14 | Telephonic Notices | 44 | ||
2.15 | Interest Payment Dates; Interest and Fee Basis | 44 | ||
2.16 | Notification of Advances, Interest Rates, Prepayments and Commitment Reductions | 45 | ||
2.17 | Lending Installations | 45 | ||
2.18 | Non-Receipt of Funds by the Agent | 45 | ||
2.19 | Facility LCs | 45 | ||
2.20 | Replacement of Lender | 50 | ||
2.21 | Defaulting Lenders | 50 | ||
2.22 | Judgment Currency | 52 | ||
2.23 | Market Disruption | 52 | ||
2.24 | Foreign Subsidiary Borrowers | 53 | ||
ARTICLE III YIELD PROTECTION; TAXES | 53 | |||
3.1 | Yield Protection | 53 | ||
3.2 | Changes in Capital Adequacy Regulations | 54 | ||
3.3 | Availability of Types of Advances | 55 | ||
3.4 | Funding Indemnification | 55 | ||
3.5 | Taxes. | 55 | ||
3.6 | UK Tax. | 57 | ||
3.7 | Lender Statements; Survival of Indemnity | 62 | ||
ARTICLE IV CONDITIONS PRECEDENT | 63 | |||
4.1 | Effectiveness of Agreement and Initial Credit Extension | 63 | ||
4.2 | Initial Advance to each Additional Foreign Subsidiary Borrower | 64 | ||
4.3 | Each Credit Extension | 66 | ||
ARTICLE V REPRESENTATIONS AND WARRANTIES | 66 | |||
5.1 | Existence and Standing | 66 | ||
5.2 | Authorization and Validity | 67 | ||
5.3 | No Conflict; Government Consent | 67 | ||
5.4 | Financial Statements | 67 | ||
5.5 | Material Adverse Change | 68 | ||
5.6 | Taxes | 68 | ||
5.7 | Litigation and Contingent Obligations | 68 | ||
5.8 | Subsidiaries | 68 | ||
5.9 | Employee Benefit Plans | 68 | ||
5.10 | Accuracy of Information | 69 | ||
5.11 | Federal Reserve Regulations | 69 | ||
5.12 | Material Agreements | 69 | ||
5.13 | Compliance With Laws | 69 | ||
5.14 | Ownership of Properties | 69 | ||
5.15 | Insurance | 70 | ||
5.16 | Environmental Matters | 70 | ||
5.17 | Investment Company Act | 70 | ||
5.18 | Centre of Main Interests and Establishment | 70 | ||
5.19 | Security Interest in Collateral | 70 | ||
5.20 | Sanctions Laws and Regulations | 70 | ||
5.21 | Solvency | 71 | ||
5.22 | No Default or Unmatured Default | 71 | ||
5.23 | Special Representations and Warranties of each Foreign Subsidiary Borrower | 71 | ||
ARTICLE VI COVENANTS | 72 | |||
6.1 | Financial Reporting | 72 | ||
6.2 | Use of Proceeds | 73 | ||
6.3 | Notice of Default | 74 | ||
6.4 | Conduct of Business | 74 | ||
6.5 | Taxes | 74 | ||
6.6 | Insurance | 74 | ||
6.7 | Compliance with Laws | 74 | ||
6.8 | Maintenance of Properties | 74 | ||
6.9 | Books and Records; Inspection | 75 | ||
6.10 | Dividends | 75 | ||
6.11 | Indebtedness | 76 | ||
6.12 | Merger | 77 | ||
6.13 | Sale of Assets | 78 | ||
6.14 | Investments and Acquisitions | 79 | ||
6.15 | Liens | 80 | ||
6.16 | Affiliates | 81 | ||
6.17 | Subordinated Indebtedness and Senior Note Indebtedness | 81 | ||
6.18 | Contingent Obligations | 82 | ||
6.19 | Financial Covenants | 82 | ||
6.20 | Fiscal Year | 83 | ||
6.21 | Subsidiary Guarantors; Pledges; Collateral Documentation; Additional Collateral; Further Assurances | 83 | ||
6.22 | Centre of Main Interests and Establishment | 87 | ||
6.23 | Sanctions Laws and Regulations | 87 | ||
ARTICLE VII DEFAULTS | 87 |
ARTICLE VIII ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES | 90 | |||
8.1 | Acceleration. | 90 | ||
8.2 | Amendments | 91 | ||
8.3 | Preservation of Rights | 93 | ||
ARTICLE IX GENERAL PROVISIONS | 93 | |||
9.1 | Survival of Representations | 93 | ||
9.2 | Governmental Regulation | 93 | ||
9.3 | Headings | 93 | ||
9.4 | Entire Agreement | 93 | ||
9.5 | Several Obligations; Benefits of this Agreement | 94 | ||
9.6 | Expenses; Indemnification | 94 | ||
9.7 | Numbers of Documents | 94 | ||
9.8 | Accounting | 94 | ||
9.9 | Severability of Provisions | 95 | ||
9.10 | Nonliability of Lenders | 95 | ||
9.11 | Confidentiality | 96 | ||
9.12 | Disclosure | 96 | ||
9.13 | USA PATRIOT ACT; European “Know Your Customer” Checks | 96 | ||
9.14 | English Language | 97 | ||
9.15 | Borrower Limitations | 97 | ||
9.16 | Interest Rate Limitation | 97 | ||
ARTICLE X THE AGENT | 97 | |||
10.1 | Appointment; Nature of Relationship | 97 | ||
10.2 | Powers | 98 | ||
10.3 | General Immunity | 98 | ||
10.4 | No Responsibility for Loans, Recitals, etc | 98 | ||
10.5 | Action on Instructions of Lenders | 98 | ||
10.6 | Employment of Agents and Counsel | 98 | ||
10.7 | Reliance on Documents; Counsel | 99 | ||
10.8 | Agent’s Reimbursement and Indemnification | 99 | ||
10.9 | Notice of Default | 99 | ||
10.10 | Rights as a Lender | 99 | ||
10.11 | Lender Credit Decision | 100 | ||
10.12 | Successor Agent | 100 | ||
10.13 | Agent and Arranger Fees | 100 | ||
10.14 | Delegation to Affiliates | 100 | ||
10.15 | Collateral Matters | 101 | ||
10.16 | Guaranty and Collateral Releases | 101 | ||
10.17 | Parallel Debt | 102 | ||
10.18 | French Security | 103 | ||
10.19 | Syndication Agents; Documentation Agents | 103 | ||
ARTICLE XI SETOFF; RATABLE PAYMENTS; APPLICATION OF PROCEEDS | 103 | |||
11.1 | Setoff | 103 | ||
11.2 | Ratable Payments | 104 | ||
11.3 | Application of Proceeds | 104 | ||
ARTICLE XII BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS | 104 | |||
12.1 | Successors and Assigns | 104 | ||
12.2 | Participations | 105 | ||
12.3 | Assignments | 106 | ||
12.4 | Dissemination of Information | 108 | ||
12.5 | Tax Treatment | 108 | ||
ARTICLE XIII NOTICES | 108 | |||
13.1 | Notices; Electronic Communication. | 108 | ||
ARTICLE XIV COUNTERPARTS; INTEGRATION; EFFECTIVENESS; ELECTRONIC EXECUTION; WAIVERS | 111 | |||
14.1 | Counterparts; Effectiveness | 111 | ||
14.2 | Electronic Execution of Assignments | 111 | ||
14.3 | Waiver of Defaults under Existing Credit Agreement | 111 | ||
ARTICLE XV CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL | 111 | |||
15.1 | CHOICE OF LAW | 111 | ||
15.2 | CONSENT TO JURISDICTION | 111 | ||
15.3 | WAIVER OF JURY TRIAL | 112 | ||
15.4 | AGENT FOR SERVICE OF PROCESS | 112 | ||
ARTICLE XVI GUARANTY | 112 | |||
16.1 | Company Guaranty | 112 | ||
16.2 | Foreign Subsidiary Borrower Guaranty | 114 | ||
16.3 | Limitation on Obligations of Foreign Subsidiary Borrowers | 114 | ||
16.4 | Keepwell | 114 |
Exhibit A | - | Opinions of Loan Parties’ Counsel |
Exhibit B | - | Compliance Certificate |
Exhibit C | - | Assignment and Acceptance |
Exhibit D-1 | - | Form of Increasing Lender Supplement |
Exhibit D-2 | - | Form of Augmenting Lender Supplement |
Exhibit E-1 | - | Note for Revolving Loans (if requested) |
Exhibit E-2 | - | Note for Term Loans (if requested) |
Exhibit F | - | Form of Assumption Letter |
Exhibit G | - | Form of UK Tax Certificate |
Exhibit H | - | Form of Subsidiary Borrower Termination |
Commitment Schedule | ||
Pricing Schedule | ||
Schedule 1.2 | - | Initial Material Domestic Subsidiaries |
Schedule 1.3 | - | Initial Material Foreign Subsidiaries |
Schedule 1.4 | - | Initial Foreign Law Pledgors and Foreign Law Pledge Agreements |
Schedule 1.5 | - | Existing Sale and Leaseback Transactions |
Schedule 2.19.13 | - | Existing Letters of Credit |
Schedule 4.1 | - | List of Closing Documents |
Schedule 5.7 | - | Litigation |
Schedule 5.8 | - | Subsidiaries |
Schedule 5.15 | - | Insurance |
Schedule 6.11 | - | Indebtedness |
Schedule 6.14 | - | Investments |
Schedule 6.15 | - | Liens |
Schedule 6.18 | - | Contingent Obligations |
(i) | the suspension of payments, a moratorium of any indebtedness, winding-up, dissolution, administration or reorganisation (by way of voluntary arrangement, scheme of arrangement or otherwise) of any UK Relevant Entity (other than a solvent liquidation or reorganisation that is not a Borrower or Guarantor); |
(ii) | a composition, compromise, assignment or arrangement with any creditor of any UK Relevant Entity; |
(iii) | the appointment of a liquidator (other than a solvent liquidation or reorganisation that is not a Borrower or Guarantor), receiver, administrative receiver, administrator, compulsory manager or other similar officer in respect of any UK Relevant Entity, or any of its assets; or |
(iv) | enforcement of any security over any assets of any UK Relevant Entity, |
Calendar Quarter Ended: | Installment Amount Due: |
September 30, 2014 | $1,125,000 |
December 31, 2014 | $1,125,000 |
March 31, 2015 | $1,125,000 |
June 30, 2015 | $1,125,000 |
September 30, 2015 | $2,250,000 |
December 31, 2015 | $2,250,000 |
March 31, 2016 | $2,250,000 |
June 30, 2016 | $2,250,000 |
September 30, 2016 | $2,250,000 |
December 31, 2016 | $2,250,000 |
March 31, 2017 | $2,250,000 |
June 30, 2017 | $2,250,000 |
September 30, 2017 | $2,250,000 |
December 31, 2017 | $2,250,000 |
March 31, 2018 | $2,250,000 |
June 30, 2018 | $2,250,000 |
Revolving Loan Termination Date | $58,500,000 |
(A) | on the proposed date of the effectiveness of such increase or Incremental Term Loans, (1) the conditions set forth in paragraphs (i) and (ii) of Section 4.3 shall be satisfied or waived by the Required Lenders and the Agent shall have received a certificate to that effect dated such date and executed by a Financial Officer of the Company, (2) the Company shall be in compliance (on a pro forma basis reasonably acceptable to the Agent) with the covenants contained in Section 6.19 as if (x) in the case of any Incremental Term Loan, such Incremental Term Loans had been outstanding on the last day of the most recent fiscal quarter for which financial statements are available for testing compliance therewith or (y) in the case any increased Revolving Loan Commitments, all Revolving Loans available under the Aggregate Revolving Loan Commitment, including any such increased Revolving Loan Commitments, had been outstanding on the last day of the most recent fiscal quarter for which financial statements are available for testing compliance therewith, and the Agent shall have received a certificate to that effect dated such date and executed by a Financial Officer of the Company, and (3) without limiting the foregoing conditions (including the preceding clause (1) as it relates to the accuracy of the representation in Section 5.3 and the absence of any Default or Unmatured Default under Section 7.5 generally), the Company shall demonstrate that such increase or Incremental Term Loans and the Liens securing such Indebtedness are permitted under the terms of the 2012 Senior Note Indenture, and |
(B) | the Agent shall have received documents consistent with those delivered pursuant to Section 4.1 or 4.2 as to the corporate power and authority of the Borrowers to borrow hereunder |
(i) | Generally. If at any time, other than solely as a result of currency rate fluctuations, (A) the Dollar Amount of the Aggregate Outstanding Revolving Credit Exposure exceeds the Aggregate Revolving Loan Commitment, (B) the aggregate Dollar Amount of all Eurocurrency Loans and LC Obligations in Foreign Currencies exceeds the Maximum Foreign Currency Amount or (C) the aggregate Dollar Amount of all Revolving Loans made to the Foreign Subsidiary Borrowers exceeds the Maximum Foreign Subsidiary Borrower Amount, the Borrowers, for the ratable benefit of the Revolving Lenders, shall immediately prepay Revolving Loans (to be applied to such Revolving Loans as the applicable Borrower shall direct at the time of such payment) in an aggregate amount such that after giving effect thereto (x) the Aggregate Outstanding Revolving Credit Exposure is less than or equal to the Aggregate Revolving Loan Commitment, (y) the aggregate Dollar Amount of all Eurocurrency Loans and LC Obligations in Foreign Currencies is less than or equal to the Maximum Foreign Currency Amount, and (z) the aggregate Dollar Amount of all Revolving Loans made to the Foreign Subsidiary Borrowers is less than or equal to the Maximum Foreign Subsidiary Borrower Amount. |
(ii) | Currency Fluctuations. If at any time solely as a result of currency rate fluctuations (A) the Dollar Amount of the Aggregate Outstanding Revolving Credit Exposure exceeds 105% of the Aggregate Revolving Loan Commitment, (B) the aggregate Dollar Amount of all Eurocurrency Loans and LC Obligations in Foreign Currencies exceeds 105% of the Maximum Foreign Currency Amount or (C) the aggregate Dollar Amount of all Revolving Loans made to the Foreign Subsidiary Borrowers exceeds 105% of the Maximum Foreign Subsidiary Borrower Amount, the Borrowers, for the ratable benefit of the Revolving Lenders, shall within five (5) Business Days of such occurrence prepay Revolving Loans (to be applied to such Revolving Loans as the applicable Borrower shall direct at the time of such payment) in an aggregate amount such that after giving effect thereto (x) the Aggregate Outstanding Revolving Credit Exposure is less than or equal to the Aggregate Revolving Loan Commitment, (y) the aggregate Dollar Amount of all Eurocurrency Loans and LC Obligations in Foreign Currencies is less than or equal to the Maximum Foreign Currency Amount, and (z) the aggregate Dollar Amount of all Revolving Loans made to the Foreign Subsidiary Borrowers is less than or equal to the Maximum Foreign Subsidiary Borrower Amount. |
(iii) | Asset Sale. Not later than the third Business Day following receipt of any Net Cash Proceeds of any Asset Sale (other than the divestiture of the Electrical Business Segment of the Company and its Subsidiaries), the Borrowers shall prepay outstanding Loans in an amount equal to 100% of the Net Cash Proceeds received with respect thereto (subject to the provisions regarding application of prepayments set forth below); provided that no such prepayment shall be required hereunder unless, and only to that extent that, the aggregate Net Cash Proceeds of Asset Sales during any fiscal year exceed 5% of Consolidated Assets (measured as of the last day of the most recently completed fiscal year); provided, further, that no mandatory prepayment shall be required pursuant to this Section 2.7(b)(iii) on account of such Net Cash Proceeds if, and to the extent that, the Company notifies the Agent in writing within three Business Days following receipt of such Net Cash Proceeds of its or its Subsidiary’s good faith intention to apply such Net Cash Proceeds to the acquisition of other assets or Property to be used in its business within 120 days following the receipt of such Net Cash Proceeds, with the amount of such Net Cash Proceeds unused after such 120-day period to be treated as Net Cash Proceeds in accordance with this Section 2.7(b)(iii). Amounts to be applied pursuant to this Section 2.7(b)(iii) shall be applied first to the Term Loans (ratably to the Initial Term Loans and the Incremental Term Loans, in each case, in accordance with the principal amounts thereof), with such prepayment applied ratably to reduce all remaining outstanding installments thereof, second to Swing Line Loans, third to Revolving Loans that are Floating Rate Loans and fourth to Revolving Loans that are Eurocurrency Loans (but without, in any such case, any reduction of the Aggregate Revolving Loan Commitment), in each case, together with accrued interest on the Loans being prepaid. All prepayments required by this Section 2.7(b)(iii) shall be subject to the payment of any funding indemnification amounts required by Section 3.4, but without penalty or premium. Notwithstanding the foregoing, so long as no Default has occurred and is then continuing and at the Company’s option, the Agent shall hold all prepayments pursuant to this clause (iii) to be applied to Eurocurrency Loans in escrow for the benefit of the Lenders and (x) the Agent shall release such amounts upon the earlier of (1) thirty days after the date of such prepayment (provided that the Borrowers shall make all payments under Section 3.4 resulting therefrom) and (2) expiration of the Interest Periods applicable to any such Eurocurrency Loans being prepaid, (y) interest shall continue to accrue on such Eurocurrency Loans until such time as such prepayments are released from escrow and |
(i) | the applicable Borrower with respect to such Advance, |
(ii) | the Borrowing Date, which shall be a Business Day, of such Advance, |
(iii) | the aggregate amount of such Advance and whether such Advance consists of Revolving Loans or Term Loans, |
(iv) | the Type of Advance selected, |
(v) | in the case of each Eurocurrency Advance, the Interest Period and Agreed Currency applicable thereto, and |
(vi) | the location and number of the account of such Borrower to which funds are to be disbursed. |
(i) | the requested date, which shall be a Business Day, of such conversion or continuation, |
(ii) | the aggregate amount and Type of the Advance which is to be converted or continued and whether such Advance consists of Revolving Loans or Term Loans, and |
(iii) | the amount of such Advance which is to be converted into or continued as a Eurocurrency Advance and the duration of the Interest Period applicable thereto. |
(i) | all or any part of the Swing Line Exposure and LC Obligations of such Defaulting Lender shall be reallocated among the non-Defaulting Lenders in accordance with their respective Revolving Loan Pro Rata Shares but only to the extent the sum of all non-Defaulting Lenders’ Outstanding Revolving Credit Exposures plus such Defaulting Lender’s Swing Line Exposure and LC Obligations does not exceed the total of all non-Defaulting Lenders’ Revolving Loan Commitments; |
(ii) | if the reallocation described in clause (i) above cannot, or can only partially, be effected, the Company shall within one (1) Business Day following notice by the Agent (x) first, prepay such Swing Line Exposure and (y) second, cash collateralize for the benefit of the LC Issuer only the Company’s obligations corresponding to such Defaulting Lender’s LC Obligations (after giving effect to any partial reallocation pursuant to clause (i) above) in accordance with the procedures set forth in Section 8.1 for so long as such LC Obligations are outstanding; |
(iii) | if the Company cash collateralizes any portion of such Defaulting Lender’s LC Obligations pursuant to clause (ii) above, the Company shall not be required to pay any letter of credit fees to such Defaulting Lender pursuant to Section 2.19.4 with respect to such Defaulting Lender’s LC Obligations during the period such Defaulting Lender’s LC Obligations are cash collateralized; |
(iv) | if the LC Obligations of the non-Defaulting Lenders are reallocated pursuant to clause (i) above, then the fees payable to the Lenders pursuant to Section 2.5(a) and Section 2.19.4 shall be adjusted in accordance with such non-Defaulting Lenders’ Revolving Loan Pro Rata Shares; and |
(v) | if all or any portion of such Defaulting Lender’s LC Obligations is neither reallocated nor cash collateralized pursuant to clause (i) or (ii) above, then, without prejudice to any rights or remedies of the LC Issuer or any other Lender hereunder, all letter of credit fees payable under Section 2.19.4 with respect to such Defaulting Lender’s LC Obligations shall be payable to the LC Issuer until and to the extent that such LC Obligations are reallocated and/or cash collateralized; and |
(iii) | subjects the Agent, any Lender or the LC Issuer to any taxes (other than (A) Taxes, (B) Other Taxes, (C) Other Connection Taxes on gross or net income, profits or revenue (including value-added or similar Taxes), (D) Excluded Taxes or (E) UK Tax attributable to a Tax Deduction required by law to be made by a Borrower or compensated for by Section 3.6) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto, or |
(iv) | imposes or increases or deems applicable any reserve, special deposit, liquidity or similar requirement (including any compulsory loan requirement, insurance charge or other assessment) against assets of, deposits with or for the account of, or credit extended by, any Lender or any applicable Lending Installation or the LC Issuer (other than reserves and assessments taken into account in determining the interest rate applicable to Eurocurrency Advances), or |
(v) | imposes any other condition the result of which is to increase the cost to any Lender or any applicable Lending Installation or the LC Issuer of making, funding or maintaining its Eurocurrency Loans, or of issuing or participating in Facility LCs, or reduces any amount receivable by any Lender or any applicable Lending Installation or the LC Issuer in connection with its Eurocurrency Loans, Facility LCs or participations therein, or requires any Lender or any applicable Lending Installation or the LC Issuer to make any payment calculated by reference to the amount of Eurocurrency Loans, Facility LCs or participations therein held or interest or LC Fees received by it, by an amount deemed material by such Lender or the LC Issuer as the case may be, |
(i) | a Lender (other than a Lender within sub-paragraph (ii) below) which is beneficially entitled to interest payable to that Lender in respect of an advance under a Loan Document and is: |
(I) | which is a bank (as defined for the purpose of section 879 of the Income Tax Act 2007) making an advance under a Loan Document; or |
(II) | in respect of an advance made under a Loan Document by a person that was a bank (as defined for the purpose of section 879 of the Income Tax Act 2007) at the time that that advance was made, |
(I) | a company resident in the United Kingdom for United Kingdom tax purposes; or |
(II) | a partnership each member of which is: |
2) | a company not so resident in the United Kingdom which carries on a trade in the United Kingdom through a permanent establishment and which brings into account in computing its chargeable profits (for the purposes of section 19 of the Corporation Tax Act 2009) the whole of any share of interest payable in respect of that advance that falls to it by reason of Part 17 of the Corporation Tax Act 2009; or |
(III) | a company not so resident in the United Kingdom which carries on a trade in the United Kingdom through a permanent establishment and which brings into account interest payable in respect of that advance in computing its chargeable profits (within the meaning given by section 19 of the Corporation Tax Act 2009). |
(ii) | a building society (as defined for the purpose of section 880 of the Income Tax Act 2007) making an advance under a Loan Document. |
(i) | is treated as a resident of a Treaty State for the purposes of the Treaty; |
(ii) | does not carry on a business in the United Kingdom through a permanent establishment with which that Lender’s participation in the Loan is effectively connected; and |
(iii) | satisfies all other conditions under that Treaty for a payment of interest made by a UK Subsidiary under a Loan to be exempt from UK income tax (and any identical or substantially similar tax that is imposed after the date of this Agreement in addition to, or in place of, UK income tax). |
(i) | (A) the relevant Lender is a Qualifying Lender solely under sub-paragraph (i)(B) of the definition of Qualifying Lender; |
(ii) | The relevant Lender is a Treaty Lender and the Lender fails to comply with its obligations under paragraph (i)(A) and (B) below, unless: |
(A) | under the law of the jurisdiction in which that Protected Party is incorporated or, if different, the jurisdiction (or jurisdictions) in which that Protected Party is treated as resident for tax purposes; or |
(B) | under the law of the jurisdiction in which that Protected Party’s facility office is located in respect of amounts received or receivable in that jurisdiction, |
(A) | is compensated for by an increased payment under paragraphs (c) to (h) above; or |
(B) | would have been compensated for by an increased payment under paragraphs (c) to (h) above but was not so compensated solely because one of the exclusions in paragraph (f) applied. |
(A) | a Tax Credit is attributable to that Tax Payment; and |
(B) | that Lender has obtained, utilized and retained that Tax Credit, |
(i) | Copies of the articles or certificate of incorporation (or comparable constituent document) of each Loan Party, together with all amendments, and a certificate of good standing, each certified by the appropriate governmental officer in its jurisdiction of incorporation or organization, as well as any other information required by Section 326 of the USA PATRIOT Act or necessary for the Agent or any Lender to verify the identity of any Loan Party as required by Section 326 of the USA PATRIOT Act. |
(ii) | Copies, certified by the Secretary or Assistant Secretary of each Loan Party, of its by-laws (or comparable governing document) and of its Board of Directors’ resolutions and of resolutions or actions of any other body authorizing the execution of the Loan Documents to which such Loan Party is a party. |
(iii) | An incumbency certificate, executed by the Secretary or Assistant Secretary of each Loan Party, which shall identify by name and title and bear the signatures of the Financial Officers of the Company and any other officers of any Loan Party authorized to sign the Loan Documents to which such Loan Party is a party, upon which certificate the Agent and the Lenders shall be entitled to rely until informed of any change in writing by such Loan Party. |
(iv) | A certificate, signed by a Financial Officer of the Company, stating that on the Closing Date (A) the representations and warranties contained in Article V are true and correct and (B) no Default or Unmatured Default has occurred and is continuing. |
(v) | Written opinions of the Loan Parties’ U.S. and U.K. counsel, addressed to the Agent and the Lenders in substantially the forms attached hereto as Exhibit A. |
(vi) | Any Notes requested by a Lender pursuant to Section 2.13 payable to each such requesting Lender. |
(vii) | Audited consolidated financial statements of the Company for the fiscal years ended August 31, 2011 and August 31, 2012 and unaudited consolidated financial statements of the |
(viii) | Satisfactory financial statement projections through and including the fiscal year ended August 31, 2018, together with such additional financial information as the Agent shall reasonably request (including, without limitation, a summary of the assumptions used in preparing such projections). |
(ix) | An opening compliance certificate in substantially the form of Exhibit B signed by a Financial Officer of the Company showing the calculations necessary to determine compliance with the covenants contained in Section 6.19 and 6.21 of this Agreement and the Pricing Leverage Ratio, in each case, as of the last day of the most recently ended fiscal quarter for which financial statements are available prior to the Closing Date, giving effect to the making of any Loans on the Closing Date, which calculations shall be prepared in a manner acceptable to the Agent and the Lenders (the “Opening Pro Forma Compliance Certificate”). |
(x) | (a) from (i) each party hereto (including Departing Lenders) either (A) a counterpart of this Agreement signed on behalf of such party or (B) written evidence satisfactory to the Agent (which may include facsimile or electronic transmission of a signed signature page of this Agreement) that such party has signed a counterpart of this Agreement or, in the case of a Departing Lender, that such Departing Lender has consented to the terms set forth in Section 1.3 hereof and (ii) each Loan Party either (A) a counterpart signed on behalf of such Loan Party or (B) written evidence satisfactory to the Agent (which may include facsimile or electronic transmission of a signed signature page of such Loan Party) that such Loan Party has signed a counterpart, of each Loan Document to which it is a party, including, without limitation, the Domestic Subsidiary Guaranty (in the case of each Domestic Subsidiary Guarantor), each Subsidiary Guaranty of a Foreign Subsidiary Borrower, the Security Agreement, and such other Collateral Documents and Loan Documents as the Agent or its counsel may have reasonably requested, and (b) any other instrument, documents, agreements opinions or certificates listed on the List of Closing Documents attached hereto as Schedule 4.1 and not otherwise listed herein. |
(xi) | Schedules and Exhibits to this Agreement in form and substance satisfactory to the Lenders. |
(xii) | Such other documents as any Lender or its counsel may have reasonably requested. |
(xiii) | If the initial Credit Extension will include the issuance of a Facility LC (other than the deemed issuance of any Existing Letters of Credit), a properly completed Facility LC Application. |
(i) | In the case of the UK Borrowers, a duly executed and delivered signature page hereto, and in the case of a Dutch Borrower an Assumption Letter executed and delivered by such Dutch Borrower and containing the written consent of each other Borrower, as contemplated by Section 2.24.1. |
(i) | Copies, certified by the Company Secretary, Assistant Secretary, managing director(s) or other authorized representative of such Foreign Subsidiary Borrower, if applicable, of its Board of Directors’ resolutions (and resolutions of other bodies, if any are deemed necessary by counsel for any Lender) approving the terms of the entry into and the transactions contemplated by the Assumption Letter and the other Loan Documents to which such Foreign Subsidiary Borrower is a party, authorizing the execution of the incumbency certificate and approving the individuals set out therein to execute all other documents, certificates and notices in connection with the transaction and the Loan Documents on its behalf. |
(ii) | Copies, certified by the Company Secretary, Assistant Secretary, managing director(s) or other authorized representative of the constitutional documents of such Foreign Subsidiary Borrower. |
(iii) | An incumbency certificate, executed by the Secretary, Assistant Secretary, managing director(s) or other authorized representative of such Foreign Subsidiary Borrower, which shall identify by name and title and bear the signature of the officers, proxyholder or managing director(s) of such Foreign Subsidiary Borrower authorized to sign the Assumption Letter and the other Loan Documents to which such Foreign Subsidiary is a party, and all other documents and notices to be signed or dispatched by it under or in connection with this Agreement or the other Loan Documents, upon which certificate the Agent and the Lenders shall be entitled to rely until informed of any change in writing by the Company. |
(iv) | (A) A written opinion of counsel to such Foreign Subsidiary Borrower, with respect to the laws of its jurisdiction of organization, addressed to the Agent and the Lenders and (B) a written opinion of U.S. counsel to the Company and such Foreign Subsidiary Borrower, addressed to the Agent and the Lenders. |
(v) | Promissory notes payable to each of the Lenders requesting promissory notes pursuant to Section 2.13(d) hereof. |
(vi) | All documentation and other information required by bank regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the USA PATRIOT Act and (if applicable). |
(vii) | In the case of a Dutch Subsidiary, the Agent shall have received from such Dutch Subsidiary (A) an original up-to-date extract from the Chamber of Commerce Trade Register and (B) |
(viii) | In the case of a UK Subsidiary, a valid direction from Her Majesty’s Revenue and Customs authorizing such Subsidiary to make interest payments hereunder to any Lender which is: |
(ix) | Such other notices, instruments, documents, opinions, documents of title and certificates as any Lender or its counsel may have reasonably requested. |
(i) | No Default or Unmatured Default exists or would exist immediately after giving effect to such Credit Extension. |
(ii) | The representations and warranties contained in Article V are true and correct as of such Credit Extension Date except to the extent any such representation or warranty is stated to relate solely to an earlier date, in which case such representation or warranty shall have been true and correct on and as of such earlier date. |
(iii) | All legal matters incident to the making of such Credit Extension shall be satisfactory to the Lenders and their counsel. |
(iv) | Within 90 days after the end of each fiscal year, its consolidated balance sheet and related statements of income and cash flows showing the financial condition of the Company and the Subsidiaries as of the close of such fiscal year and the results of the operations of the Company and the Subsidiaries during such year, all in reasonable detail, setting forth in each case in comparative form (a) the corresponding statements for the preceding fiscal year and (b) the budget corresponding to such period previously provided pursuant to Section 6.1(iii). Any such consolidated financial statements shall have been audited by PricewaterhouseCoopers LLP or other independent public accountants of recognized national standing, and shall be accompanied by (x) an opinion of such accountants (which shall not be qualified in any material respect) to the effect that such consolidated financial statements fairly present in all material respects the financial condition and results of operations of the Company and the Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, (y) any management letter prepared by such accountants and (z) at the reasonable request of the Agent, a certificate of such accountants that, in the course of their examination necessary for their certification of the foregoing, they have obtained no knowledge of any Default or Unmatured Default, or if, in the opinion of such accountants, any Default or Unmatured Default shall exist, stating the nature and status thereof. |
(v) | Within 45 days after the end of each of the first three fiscal quarters of each fiscal year, its consolidated balance sheet and related statements of income and cash flows showing the financial condition of the Company and the Subsidiaries as of the close of such fiscal quarter and the results of the operations of the Company and the Subsidiaries during such fiscal quarter and the then elapsed portion of the fiscal year, all in reasonable detail and certified by one of its Financial Officers as fairly presenting in all material respects the financial condition and results of operations of each of the Company and the Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year- |
(vi) | No later than 75 days following the first day of each fiscal year of the Company, a budget in form reasonably satisfactory to the Agent (including budgeted statements of income by each of the Company’s business segments and consolidated as to sources and uses of cash and balance sheets) prepared by the Company for each of the four quarters of such fiscal year prepared in the same level of detail as prepared for and delivered to the Company’s board of directors, in each case, of the Company and the Subsidiaries, accompanied by the statement of a Financial Officer of the Company to the effect that the budget is a reasonable estimate for the period covered thereby. |
(vii) | Together with the financial statements required under Sections 6.1(i) and (ii), a compliance certificate in substantially the form of Exhibit B signed by one of its Financial Officers showing the calculations necessary to determine compliance with the covenants contained in Section 6.19 and 6.21 of this Agreement and stating that no Default or Unmatured Default exists, or if any Default or Unmatured Default exists, stating the nature and status thereof, and attaching any updates to the Exhibits to the Security Agreement if required pursuant to the terms thereof. |
(viii) | As soon as possible and in any event within 10 days after (a) the United Kingdom Pensions Regulator issuing a financial support direction or a contribution notice (as those terms are defined in the United Kingdom Pensions Act 2004) in relation to any Foreign Pension Plan, (b) any amount is due to any Foreign Pension Plan pursuant to Section 75 or 75A of the United Kingdom Pensions Act 1995, (c) an amount becomes payable under section 75 or 75A of the United Kingdom Pensions Act of 1995 and/or (d) the Company knows that any Reportable Event has occurred with respect to any Plan, a statement, signed by a Financial Officer of the Company, describing such matter or event and the action which the Company proposes to take with respect thereto. |
(ix) | Promptly upon the furnishing thereof to the shareholders of the Company, copies of all financial statements, reports and proxy statements so furnished. So long as the Company is a public company for reporting purposes under the Exchange Act, compliance with clause (vii) below shall be deemed to be in compliance with this clause (vi). |
(x) | Promptly upon the filing thereof, copies of all registration statements and annual, quarterly, monthly or other regular reports which the Company or any of its Subsidiaries files with the Securities and Exchange Commission. |
(xi) | If requested by the Agent, together with the financial statements required under Section 6.1(i), a certificate of good standing for the Company and (to the extent such concept applies to such entity) each other Person which has pledged collateral in support of the Secured Obligations from the appropriate governmental officer in its jurisdiction of incorporation or organization. |
(xii) | Such other information (including non-financial information) as the Agent or any Lender may from time to time reasonably request. |
(i) | (a) Any Wholly-Owned Subsidiary of the Company may pay Dividends to the Company or any Wholly-Owned Subsidiary of the Company and (b) any Subsidiary that is not a Wholly-Owned Subsidiary may pay Dividends to its shareholders generally so long as the Company or its respective Subsidiary which owns the Equity Interest in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holdings of Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests in such Subsidiary). |
(ii) | So long as there shall exist no Default or Unmatured Default (both before and after giving effect to the payment thereof), the Company may repurchase outstanding shares of its common stock (or options to purchase such common stock) following the death, disability, retirement or termination of employment of employees, officers or directors of the Company or any of its Subsidiaries; provided that (a) all amounts used to effect such repurchases are obtained by the Company from a substantially concurrent issuance of its common stock (or options to purchase such common stock) to other employees, members of management, executive officers or directors of the Company or any of its Subsidiaries or (b) to the extent the proceeds used to effect any repurchase are not obtained as described in preceding clause (a), the aggregate amount of Dividends paid by the Company pursuant to this Section 6.10(ii) (exclusive of amounts paid as described pursuant to preceding clause (a)) shall not exceed $1,000,000 in any fiscal year of the Company; provided that, in the event that the maximum amount which is permitted to be expended in respect of Dividends during any fiscal year pursuant to this clause (b) is not fully expended during such fiscal year, the maximum amount which may be expended during the immediately succeeding fiscal year pursuant to this clause (b) shall be increased by such unutilized amount. |
(iii) | So long as there shall exist no Default or Unmatured Default (both before and after giving effect to the payment thereof), the Company may repurchase outstanding shares of its common stock or equivalents thereof or rights to purchase any of the foregoing issued in connection with the Company’s directors compensation plan; provided that the aggregate amount of shares repurchased paid by the Company pursuant to this Section 6.10(iii) (exclusive of amounts paid as described pursuant to Section 6.10(ii)) shall not exceed $750,000 in any fiscal year of the Company and shall not exceed a maximum of $1,750,000 for all such repurchases made on or after the Closing Date. |
(iv) | So long as there shall exist no Default or Unmatured Default (both before and after giving effect to the declaration and payment thereof), the Company may make or pay Dividends with respect to its outstanding common stock; provided that, the Leverage Ratio for the four fiscal quarter period most recently ended as of such date calculated on a pro forma basis reasonably acceptable to the Agent after giving effect to such Dividend (and any Indebtedness incurred in connection therewith), as if such Dividend (and incurrence of Indebtedness, if any) had occurred on the last day of such period, shall be less than 3.25 to 1.00 or, following the Collateral Release Date, 3.00 to 1.00; provided, further, that the Company shall have furnished to Agent a certificate reasonably acceptable to Agent demonstrating such pro forma compliance in reasonable detail prior to making or paying any such Dividend if (i) the pro forma Leverage Ratio after giving effect to such Dividend would be greater than or equal to 2.75 to 1.00 or, following the Collateral Release Date, 2.50 to 1.00, (ii) any such Dividend (or series of related Dividends) exceeds $75,000,000 (it being understood that in the case of Dividends made pursuant to an authorized share buyback program, a certificate shall not be required unless and until such threshold is exceeded) or (iii) the Agent so requests. |
(v) | So long as there shall exist no Default or Unmatured Default (both before and after giving effect to the declaration and payment thereof) the Company may make or pay additional Dividends with respect to its outstanding common stock not otherwise permitted under this Section 6.10 in an aggregate amount not to exceed $25,000,000 in any fiscal year of the Company. |
(i) | The Loans and the Reimbursement Obligations. |
(ii) | [Reserved] |
(iii) | Receivables Transaction Attributed Indebtedness and/or Indebtedness incurred pursuant to Qualified Receivables Transactions in an aggregate amount not to exceed at any time 7.5% Consolidated Assets of the Company and its Subsidiaries (measured as of the end of the most recent fiscal quarter). |
(iv) | Indebtedness (if any) resulting from any recharacterization of any Permitted Factoring Transaction. |
(v) | Indebtedness actually outstanding on the date hereof and listed on Schedule 6.11 (excluding any Indebtedness described in clauses (i) and (iii) and the 2012 Senior Notes), but not any refinancings or renewals thereof. |
(vi) | Rate Management Obligations under Rate Management Transactions entered into from time to time by the Company and its Subsidiaries and which the Company in good faith believes will provide protection against its reasonably estimated interest rate, foreign currency or commodity exposure. |
(vii) | (a) Capitalized Lease Obligations and (b) Indebtedness pursuant to Sale and Leaseback Transactions, the Attributable Debt of which, together with Capitalized Lease Obligations permitted under clause (a), shall not exceed at any time 3.5% Consolidated Assets of the Company and its Subsidiaries (measured as of the end of the most recent fiscal quarter). |
(viii) | Intercompany Indebtedness of the Company and its Subsidiaries outstanding to the extent permitted by Section 6.14. |
(ix) | Any indebtedness arising under a declaration of joint and several liability used for the purpose of section 2:403 of the Dutch Civil Code (Burgerlijk Wetboek) (and any residual liability under such declaration arising pursuant to section 2:404(2) of the Dutch Civil Code (Burgerlijk Wetboek)). |
(x) | In addition to any Indebtedness permitted by the preceding clause (viii), Indebtedness of any Wholly-Owned Subsidiary to the Company or another Wholly-Owned Subsidiary constituting the purchase price in respect of intercompany transfers of goods and services made in the ordinary course of business to the extent not constituting Indebtedness for borrowed money. |
(xi) | Indebtedness under performance bonds, letter of credit obligations to provide security for worker’s compensation claims and bank overdrafts, in each case incurred in the ordinary course of business; provided that any obligations arising in connection with such bank overdraft Indebtedness is extinguished within five Business Days of its incurrence. |
(xii) | Indebtedness incurred by Foreign Subsidiaries from time to time after the Closing Date, so long as the aggregate principal amount of all Indebtedness (including trade letters of credit) incurred pursuant to this clause (xii) at any time outstanding shall not exceed $75,000,000; provided that the aggregate principal amount of all such Indebtedness incurred by Foreign Subsidiary Borrowers shall not exceed $50,000,000. |
(xiii) | Indebtedness of any Person that becomes a Foreign Subsidiary after the Closing Date pursuant to a Permitted Acquisition, so long as such Indebtedness exists at the time of such Permitted Acquisition and is not incurred in contemplation of or in connection with such Permitted Acquisition, and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof. |
(xiv) | Additional unsecured Indebtedness of the Company and the Domestic Subsidiary Guarantors, including Senior Note Indebtedness and Subordinated Indebtedness; provided, that (a) any senior unsecured Indebtedness of the Company or its Subsidiaries under any notes or convertible notes permitted hereunder and issued under an indenture, loan agreement, note purchase agreement or similar governing instrument or document in a |
(i) | Sales of inventory in the ordinary course of business and consistent with past practices. |
(ii) | Any transfer of an interest in accounts or notes receivable and related assets as part of a Qualified Receivables Transaction or Permitted Factoring Transaction. |
(iii) | Investments to the extent permitted by Section 6.14. |
(iv) | Licenses, cross-licenses or sublicenses by the Company and its Subsidiaries of software, trademarks and other intellectual property in the ordinary course of business and which do not materially interfere with the business of the Company or of the Company and the Subsidiaries, taken as a whole. |
(v) | The Company and its Subsidiaries may sell or discount, in each case without recourse and in the ordinary course of business, overdue accounts receivable arising in the ordinary course of business, but only in connection with the compromise or collection thereof consistent with ordinary business practice (and not as part of any bulk sale). |
(vi) | (A) The Company or any Domestic Subsidiary of the Company that is a Wholly-Owned Subsidiary may sell, transfer or lease Property to the Company or any other Domestic Subsidiary that is a Wholly-Owned Subsidiary, (B) any Foreign Subsidiary Borrower may sell, transfer or lease Property to the Company, a Domestic Subsidiary or another Foreign Subsidiary Borrower and (C) any Foreign Subsidiary (other than a Foreign Subsidiary Borrower) may sell, transfer or lease Property to the Company or any other Subsidiary. |
(viii) | Each of the Company and its Subsidiaries may, in the ordinary course of business, sell, lease or otherwise dispose of any assets which, in the reasonable judgment of such Person, are obsolete, worn out or otherwise no longer useful in the conduct of such Person’s business. |
(ix) | The Company and its Subsidiaries may sell its Electrical Business Segment. |
(x) | The Company or any Domestic Subsidiary may sell Equity Interests in any Foreign Subsidiary to another Foreign Subsidiary; provided, such sale shall be made for cash at fair market value as reasonably determined by the Company or such Domestic Subsidiary. |
(xi) | Each of the Company and its Subsidiaries may, unless a Default shall have occurred and be continuing, subject to Section 2.7(b)(iii), sell, lease or otherwise dispose of any assets, provided that (A) the aggregate consideration received in respect of all Asset Sales pursuant to this clause (xi) during any four fiscal quarter period shall not exceed 10% of the Consolidated Assets of the Company and its Subsidiaries (measured as of the end of the fiscal quarter most recently completed prior to such disposition) and (B) the aggregate consideration received in respect of all Asset Sales pursuant to this clause (xi) after the Closing Date shall not exceed 15% of the Consolidated Assets of the Company and its Subsidiaries (measured as of the end of the fiscal quarter most recently completed prior to the first such disposition completed after the Closing Date). |
(xii) | The Company and its Subsidiaries may enter into one or more Sale and Leaseback Transactions, provided that the Attributable Debt arising therefrom, together with any Capitalized Lease Obligations permitted under Section 6.11(vii)(a) shall not exceed 3.5% Consolidated Assets of the Company and its Subsidiaries (measured as of the end of the most recent fiscal quarter) at any time outstanding. |
(i) | Cash Equivalent Investments. |
(ii) | Existing Investments in Subsidiaries and other Investments in existence on the Closing Date and described in Schedule 6.14. |
(iii) | Investments comprised of capital contributions (whether in the form of cash, a note, or other assets) to a Subsidiary or other special-purpose entity created solely to engage in a Qualified Receivables Transaction or otherwise resulting from transfers of assets permitted by Section 6.13(ii) to such a special-purpose entity. |
(iv) | Permitted Acquisitions. |
(v) | Investments by the Company or any Subsidiary in the Company or any Domestic Subsidiary. |
(vi) | Investments by the Company or any Subsidiary in any Foreign Subsidiary of the Company, provided that the aggregate amount (determined without regard to any write-downs or write-offs thereof) of (x) all such Investments of the Company and the Domestic Subsidiaries in Foreign Subsidiaries made after the Closing Date at any time outstanding and (y) all such Investments of the Foreign Subsidiary Borrowers in other Foreign Subsidiaries made after the Closing Date at any time outstanding shall not exceed $100,000,000; provided, further, that, subject to compliance with each other covenant set forth in this Article VI in connection with any such transaction, (a) the value of any assets (other than cash and cash equivalents) distributed to the Company or any Domestic Subsidiary by a Foreign Subsidiary (directly or indirectly) that are contributed to or otherwise invested in a Foreign Subsidiary |
(vii) | [Reserved] |
(viii) | [Reserved] |
(ix) | The purchase by a Foreign Subsidiary of the Equity Interests of another Foreign Subsidiary as described in Section 6.13(x). |
(x) | Other Investments not otherwise permitted by clauses (i) through (ix) above, provided that the aggregate amount of all such Investments made after the Closing Date at any time outstanding (determined without regard to any write-downs or write-offs thereof) shall not exceed $10,000,000. |
(i) | Liens (other than any Lien imposed by ERISA or any Environmental Law) for taxes, assessments or governmental charges or levies on its Property if the same shall not at the time be delinquent or thereafter can be paid without penalty, or are being contested in good faith and by appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set aside on its books. |
(ii) | Liens imposed by law, such as carriers’, warehousemen’s and mechanics’ liens and other similar liens arising in the ordinary course of business (a) which do not in the aggregate materially detract from the value of the property or assets of the Company and the Subsidiaries, taken as a whole, and do not materially impair the use thereof in the operation of the business of the Company and the Subsidiaries, taken as a whole, or (b) which are being contested in good faith by appropriate proceedings and for which adequate reserves shall have been set aside on its books. |
(iii) | Liens (other than any Lien imposed by ERISA) (a) arising out of pledges or deposits under worker’s compensation laws, unemployment insurance, old age pensions, or other social security or retirement benefits, or similar legislation, (b) to secure the performance of tenders, statutory obligations (other than excise taxes), surety, stay, customs and appeal bonds, statutory bonds, bids, leases, government contracts, trade contracts, performance and return of money bonds and other similar obligations (exclusive of obligations for the payment of borrowed money) or (c) arising by virtue of deposits made in the ordinary course of business to secure liability for premiums to insurance carriers; provided that the aggregate amount of deposits at any time pursuant to clause (b) and clause (c) shall not exceed $1,000,000 in the aggregate. |
(iv) | Utility easements, building restrictions and such other encumbrances or charges against real property as are of a nature generally existing with respect to properties of a similar character and which do not in any material way affect the marketability of the same or interfere with the use thereof in the business of the Company or its Subsidiaries. |
(v) | Liens existing on the Closing Date and described in Schedule 6.15, provided that (i) the aggregate principal amount of the Indebtedness, if any, secured by such Liens does not increase and (ii) such Liens do not encumber any additional assets or properties of the Company or any of its Subsidiaries. |
(vi) | Liens in favor of the Agent, for the benefit of the Lenders, in the Facility LC Collateral Account or granted pursuant to any Collateral Document. |
(vii) | Liens incurred in connection with any transfer of an interest in accounts or notes receivable or related assets as part of a Qualified Receivables Transaction or Permitted Factoring Transaction. |
(viii) | Any Lien of a lessor under a Capitalized Lease on assets subject to such Capitalized Lease securing Capitalized Lease Obligations permitted by Section 6.11(vii). |
(ix) | Liens arising out of judgments or awards not giving rise to a Default in respect of which the Company or any of its Subsidiaries shall in good faith be prosecuting an appeal or proceedings for review and in respect of which there shall be secured a subsisting stay of execution pending such appeal or proceedings. |
(x) | Any interest or title of a lessor, sublessor, licensee or licensor under any lease (other than a Capitalized Lease) or license agreement permitted by this Agreement, including any Lien filed to prevent the impairment of any such interest. |
(xi) | Liens in favor of customs and revenue authorities arising as a matter of law to secure the payment of customs duties in connection with the importation of goods. |
(xii) | In the case of any Dutch Subsidiary, Liens created or to be created pursuant to the general conditions of a bank operating in the Netherlands based on the general conditions drawn up by the Netherlands Bankers’ Association (Nederlandse Vereniging van Banken) and the Consumers’ Union (Consumenten bond). |
(xiii) | Liens on assets of Foreign Subsidiaries (other than Foreign Subsidiary Borrowers); provided that (a) such Liens do not extend to, or encumber, assets which constitute Equity Interests in any of the Company’s Subsidiaries and (b) such Liens extending to the assets of any Foreign Subsidiary secure only Indebtedness incurred by such Foreign Subsidiary pursuant to Section 6.11(xii). |
(xiv) | Liens upon assets of the Company or any of its Subsidiaries subject to Sale and Leaseback Transactions to the extent permitted by Section 6.13(xii); provided that (a) in each case, such Liens only serve to secure the payment of Attributable Debt arising under such Sale and Leaseback Transaction and do not encumber any other asset (other than proceeds thereof) of the Company or any Subsidiary of the Company and (b) the aggregate outstanding principal amount of all Attributable Debt secured by Liens permitted by this clause (xiv) shall not at any time exceed, together with all Capitalized Lease Obligations permitted by Section 6.11(vii)(a), 3.5% Consolidated Assets of the Company and its Subsidiaries (measured as of the end of the most recent fiscal quarter). |
(xv) | Deposit arrangements and pledges of cash or cash equivalents in an aggregate amount not to exceed $5,000,000 at any time to secure Banking Services Obligations. |
(xvi) | Liens not otherwise permitted by the foregoing clauses (i) through (xv) to securing liabilities not in excess of, $5,000,000 in the aggregate at any time outstanding. |
(i) | At all times from the Closing Date until (but not including) the first fiscal quarter ending on or after the Collateral Release Date, the Company will not permit the Leverage Ratio, determined as of the end of each of its fiscal quarters, to be greater than 3.75 to 1.00. |
(ii) | Notwithstanding the immediately preceding clause (i), commencing with the first fiscal quarter ending after the Closing Date and prior to the Collateral Release Date, the Leverage Ratio may be up to 4.25 to 1.00 for any fiscal quarter during which the Company or any of its Subsidiaries has entered into a Specified Acquisition (a “Trigger Quarter”) and for the next succeeding fiscal quarter (or, if such Specified Acquisition occurred after the forty-fifth (45th) day of such Trigger Quarter, the Leverage Ratio may be up to 4.25 to 1.00 for such Trigger Quarter and the next two succeeding fiscal quarters); provided, that the Leverage Ratio shall return to 3.75 to 1.00 (or lower) no later than the second fiscal quarter after such Trigger Quarter (or, if such Specified Acquisition occurred after the forty-fifth (45th) day of such Trigger Quarter, no later than the third fiscal quarter after such Trigger Quarter); provided, further, that following the occurrence of a Trigger Quarter, no subsequent Trigger Quarter shall be permitted to occur for purposes of this Section 6.19.1(a) unless and until the Leverage Ratio is less than or equal to 3.75 to 1.00 as of the end of at least one fiscal quarter following the applicable Specified Acquisition. |
(i) | Commencing with the first fiscal quarter ending on or after the Collateral Release Date, the Company will not permit the Leverage Ratio, determined as of the end of each of its fiscal quarters, to be greater than 3.50 to 1.00. |
(ii) | Notwithstanding the immediately preceding clause (i), from and after the Collateral Release Date the Leverage Ratio may be up to 4.00 to 1.00 for any Trigger Quarter and for the next succeeding fiscal quarter (or, if the Specified Acquisition giving rise to such Trigger Quarter occurred after the forty-fifth (45th) day of such Trigger Quarter, the Leverage Ratio may be up to 4.00 to 1.00 for such Trigger Quarter and the next two succeeding fiscal quarters); provided, that the Leverage Ratio shall return to 3.50 to 1.00 (or lower) no later than the second fiscal quarter after such Trigger Quarter (or, if such Specified Acquisition occurred after the forty-fifth (45th) day of such Trigger Quarter, no later than the third fiscal quarter after such Trigger Quarter); provided, further, that following the occurrence of a Trigger Quarter, no subsequent Trigger Quarter shall be permitted to occur for purposes of this Section 6.19.1(b) unless and until the Leverage Ratio is less than or equal to 3.50 to 1.00 as of the end of at least one fiscal quarter following the applicable Specified Acquisition. |
(i) | 85% of Company and Domestic Subsidiaries. If, at any time after the Closing Date, (x) the aggregate assets of the Company and the Domestic Subsidiary Guarantors (other than Equity Interests in Subsidiaries) shall fail to represent 85% or more of the aggregate assets of the Company and its Domestic Subsidiaries (other than Equity Interests in Subsidiaries) as of such time or (y) such entities on an aggregate basis shall fail to be responsible for 85% or more of the aggregate operating income of the Company and its Domestic Subsidiaries for the four fiscal quarter period then ended, the Company shall promptly notify the Agent thereof, which notice shall specify the date as of which such failure arose. Within 30 days after the date specified in such notice (or such longer period as may be agreed by the Agent |
(ii) | Guarantees of Other Obligations. If, at any time after the Closing Date, any Subsidiary of the Company that is not party to the Domestic Subsidiary Guaranty shall become party to a guaranty of the Senior Note Indebtedness or any other obligation of the Company, the Company shall immediately notify the Agent thereof and cause such Subsidiary to comply with Section 6.21(a) (but without giving effect to the 30-day grace period provided therein). |
(i) | The Lenders hereby irrevocably authorize the Agent to, and the Agent shall, release any Liens granted to the Agent by the Loan Parties on any Collateral (i) upon the termination of the all Revolving Loan Commitments, the expiration or termination of all Facility LCs and payment and satisfaction in full in cash of all Secured Obligations (other than contingent indemnity obligations), (ii) upon the Company’s request following the date upon which (a) the Company’s S&P Rating is BBB- (with stable outlook) or better and (b) the Company’s Moody’s Rating is Baa3 (with stable outlook) or better (provided, that if either S&P or Moody’s is unwilling to provide a rating following the use of reasonable efforts by the Company to obtain such rating, the parties will use the comparable rating of a substitute rating agency to be agreed by the Company and the Agent); provided, that following any |
(ii) | The Lenders hereby irrevocably authorize the Agent to, and the Agent shall, in the event of a sale, transfer or other disposition of all of the Equity Interests of any Domestic Subsidiary Guarantor if the Company certifies to the Agent that such sale, transfer or disposition is made in compliance with the terms of this Agreement (and the Agent may rely conclusively on any such certificate, without further inquiry), (x) release such Domestic Subsidiary Guarantor from its obligations under the Domestic Subsidiary Guaranty and each other Loan Document to which it is a party and (y) release any Liens granted to the Agent by such Domestic Subsidiary Guarantor on any Collateral (or by its parent on the Equity Interests of such Domestic Subsidiary Guarantor), provided that (i) such Domestic Subsidiary Guarantor is concurrently released from any obligations it may have with respect to Subordinated Indebtedness and Senior Note Indebtedness and (ii) after such release the Company remains in compliance with Section 6.21(c). |
(i) | Without limiting the foregoing, the Company will, and will cause each Subsidiary to, execute and deliver, or cause to be executed and delivered, to the Agent such documents, agreements and instruments, and will take or cause to be taken such further actions (including the filing and recording of financing statements and other documents, as applicable), which may be required by law or which the Agent may, from time to time, reasonably request to carry out the terms and conditions of this Agreement and the other Loan Documents and to ensure perfection and priority of the Liens created or intended to be created by the Collateral Documents, all at the expense of the Company. |
(ii) | If any assets of a type constituting Collateral under the Security Agreement are acquired by the Company or a Domestic Subsidiary Guarantor after the Closing Date (other than assets constituting Collateral under the Security Agreement that become subject to the Lien under the Security Agreement upon acquisition thereof), the Company will notify the Agent thereof, and, if requested by the Agent, the Company will cause such assets to be subjected to a Lien securing the Secured Obligations and will take, and cause the other Loan Parties to take, such actions as shall be necessary or reasonably requested by the Agent to grant and perfect such Liens, including actions described in Section 6.21(h)(i), all at the expense of the Company. |
(i) | Reduce the principal amount of any Loan or Reimbursement Obligation or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of each Lender directly affected thereby. |
(ii) | Postpone the scheduled date of payment of the principal amount of any Loan or Reimbursement Obligation, or any interest thereon, or any fees payable hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Revolving Loan Commitment or Term Loan Commitment, without the written consent of each Lender directly affected thereby. |
(iii) | Reduce the percentage specified in the definition of Required Lenders or any other percentage of Lenders specified to be the applicable percentage in this Agreement to act on |
(iv) | Increase the amount of the Revolving Loan Commitment or Term Loan Commitment of any Lender hereunder without the consent of such Lender. |
(v) | Permit any Borrower to assign its rights under this Agreement without the written consent of each Lender. |
(vi) | Amend this Section 8.2 without the written consent of each Lender. |
(vii) | Amend the definition of “Agreed Currency” set forth in Section 1.1 without the written consent of each Lender directly affected thereby. |
(viii) | Release any Domestic Subsidiary Guarantor, except in connection with a disposition of all of the Equity Interests of a Domestic Subsidiary Guarantor otherwise permitted by the Loan Documents, or, except as provided in the Collateral Documents, release all or substantially all of the Collateral, in any such case, without the written consent of each Lender. |
(ix) | (A) Release the Company from its obligations under Section 16.1 or (B) unless at such time no other Foreign Subsidiary Borrowers are party hereto, release any Foreign Subsidiary Borrower from its obligations under any Subsidiary Guaranty without the written consent of each Lender. |
(x) | Amend Section 11.2 in a manner that would alter the pro rata sharing of payments required thereby without the written consent of each Lender directly affected thereby. |
(vi) | Each such assignment shall be of a constant and not varying ratable or non-pro rata percentage (as between the Term Loan Facility and the Revolving Facility) of the assigning Lender’s rights and obligations under the Loan Documents; |
(vii) | Such assignment shall be substantially in the form of Exhibit C or in such other form as may be agreed to by the parties thereto; |
(viii) | Each such assignment with respect to a Purchaser which is not a Lender or an Affiliate of a Lender or an Approved Fund shall either be in an amount equal to the entire applicable Revolving Loan Commitment and Outstanding Revolving Credit Exposure and/or Term Loan Commitment (if any) and Term Loans, as applicable, of the assigning Lender or (unless each of the Company and the Agent otherwise consents; provided that the consent of the Company shall not be required if a Default has occurred and is continuing) be in an aggregate amount not less than $5,000,000. The amount of the assignment shall be based on the Revolving Loan Commitment or Outstanding Revolving Credit Exposure (if the Revolving Loan Commitment has been terminated) and/or the outstanding Term Loan Commitment |
(ix) | Except in the case of an assignment to an existing Lender that has advanced a Revolving Loan to each Dutch Borrower, the amount of such assignment with respect to a borrowing made to a Dutch Borrower shall always be at least €50,000 (or its equivalent in another Agreed Currency) unless an assignment is made to any Person which qualifies as a professional market party (professionele markt partij) under the Dutch Financial Supervision Act; |
(x) | The Purchaser (A) if it is a Non-U.S. Lender, shall have delivered tax certificates described in Section 3.5, which indicate that such Non-U.S. Lender is exempt from any withholding tax under the laws of the United States on payments by the Company in such jurisdiction, (B) in the case of an assignment of any Revolving Loan Commitment or Revolving Loan, shall have confirmed that it is exempt from any withholding tax under the laws of the Netherlands on payments by Dutch Borrowers (unless the Company has confirmed in writing its intention not to add any Dutch Borrowers to this Agreement under Section 2.24.1, or, following the addition of any Dutch Borrower under Such Section 2.24.1, all Dutch Borrowers have been removed from this Agreement pursuant to Section 2.24.2) and (C) in the case of an assignment of any Revolving Loan Commitment or Revolving Loan, shall have provided to the Agent for the onward transmission to the relevant UK Borrower, in respect of Loans made to a UK Borrower, a tax certificate in the form set forth in the Exhibit G attached hereto (unless all UK Borrowers have been removed from this Agreement pursuant to Section 2.24.2), except, in the case of clauses (A) and (B), to the extent the assigning Lender was entitled, at the time of the assignment, to receive additional amounts with respect to such withholding taxes pursuant to Section 3.5; and |
(xi) | So long as no Default shall have occurred and be continuing, no such assignment shall be made to any Person that is not capable of lending (A) Agreed Currencies to each Borrower and (B) each Type of Loan. |
(xv) | if to any Borrower or any other Loan Party, to: |
(xvi) | if to the Agent (except as set forth in clause (iii) below), to: |
(xvii) | if to the Agent in respect of a Borrowing Notice or Conversion/Continuation Notice for an Advance denominated in a Foreign Currency or to a Foreign Subsidiary Borrower, to: |
(xviii) | if to JPMorgan in its capacity as LC Issuer, to: |
(xix) | if to any other Person in its capacity as LC Issuer, at the address specified by such Person to the Company and the Agent upon such Person becoming an LC Issuer hereunder; and |
(xx) | if to a Lender, to it at its address (or telecopier number) set forth in its administrative questionnaire furnished to the Agent. |
(i) | The Company agrees that Agent may, but shall not be obligated to, make Communications (as defined below) available to the LC Issuers and the other Lenders by posting the Communications on Debt Domain, Intralinks, Syndtrak, ClearPar or a substantially similar Electronic System. |
(ii) | Any Electronic System used by Agent is provided “as is” and “as available.” The Agent Parties (as defined below) do not warrant the adequacy of such Electronic Systems and expressly disclaim liability for errors or omissions in the Communications. No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or |
Lender | Revolving Loan Commitments | Initial Term Loan Commitments | Total Commitments |
JPMorgan Chase Bank, N.A. | $64,285,714.30 | $9,642,857.14 | $73,928,571.44 |
Bank of America, N.A. | $64,285,714.30 | $9,642,857.14 | $73,928,571.44 |
Wells Fargo Bank, N.A. | $64,285,714.30 | $9,642,857.14 | $73,928,571.44 |
U.S. Bank National Association | $64,285,714.30 | $9,642,857.14 | $73,928,571.44 |
KeyBank National Association | $55,714,285.76 | $8,357,142.86 | $64,071,428.62 |
BMO Harris Bank N.A. | $55,714,285.76 | $8,357,142.86 | $64,071,428.62 |
SunTrust Bank, N.A. | $40,035,983.47 | $6,005,397.53 | $46,041,381.00 |
RBS Citizens, N.A. | $40,035,983.47 | $6,005,397.53 | $46,041,381.00 |
PNC Bank, National Association | $40,035,983.47 | $6,005,397.53 | $46,041,381.00 |
Royal Bank of Canada | $37,714,286.09 | 5,657.142.91 | $43,371,429.00 |
Branch Banking and Trust Company | $26,086,956.52 | $3,913,043.48 | $30,000,000.00 |
The Northern Trust Company | $26,086,956.52 | $3,913,043.48 | $30,000,000.00 |
Associated Bank, N.A. | $21,432,421.74 | $3,214,863.26 | $24,647,285.00 |
Total Allocations | $600,000,000.00 | $90,000,000.00 | $690,000,000.00 |
Applicable Margin | Level I Status | Level II Status | Level III Status | Level IV Status | Level V Status | Level VI Status | Level VII Status |
Eurocurrency Rate | 1.00% | 1.25% | 1.50% | 1.75% | 2.00% | 2.25% | 2.50% |
ABR | 0.00% | 0.25% | 0.50% | 0.75% | 1.00% | 1.25% | 1.50% |
Applicable Fee Rate | Level I Status | Level II Status | Level III Status | Level IV Status | Level V Status | Level VI Status | Level VII Status |
Commitment Fee | 0.15% | 0.175% | 0.20% | 0.25% | 0.30% | 0.35% | 0.40% |
To: | The Lenders party to the Credit Agreement described below |
Consolidated EBITDA | |
+/– Consolidated Net Income (Loss) | $__________ |
+ | +__________ |
+ | +__________ |
+ | +__________ |
+ | +__________ |
+ | +__________ |
+ | +__________ |
+ | +__________ |
+ | +__________ |
+ | + __________ |
+ | +__________ |
+ | +__________ |
+ | +__________ |
- extraordinary gains | - ___________ |
- gains from sales of assets other than inventory sold in the ordinary course of business | - ___________ |
Consolidated EBITDA | =__________ |
Consolidated Indebtedness as of the last day of the Fiscal Quarter | $___________ |
Consolidated EBITDA | $___________ |
(a) Actual Leverage Ratio for Fiscal Quarter | ____ to 1.00 |
(b) Maximum permitted Leverage Ratio for Fiscal Quarter | [[3.75 to 1.00] [4.25 to 1.00 due to Specified Acquisition completed on ________, 20__]] [[3.50 to 1.00] [4.00 to 1.00 due to Specified Acquisition completed on ________, 20__]] |
Consolidated EBITDA | $ ___________ |
Consolidated Interest Expense | $___________ |
(a) Actual Interest Coverage Ratio for Fiscal Quarter | ____ to 1.00 |
(b) Minimum Permitted Interest Coverage Ratio | 3.50 to 1.00 |
C. | MATERIAL DOMESTIC SUBSIDIARY AND MATERIAL FOREIGN SUBSIDIARY CLASSIFICATION (DEFINITIONS, SECTION 6.21(a), (b)) |
1. | 10.0% of the Consolidated Assets of the Company and its Subsidiaries as of the last day of the Fiscal Quarter $_________ |
2. | 10.0% of the Consolidated Operating Income of the Company and its Subsidiaries for the Fiscal Quarter $_________ |
4. | Material Foreign Subsidiaries (a) Identify on Exhibit A hereto each Foreign Subsidiary of the Company any Equity Interest of which are held by the Company or any Domestic Subsidiary and that, on a consolidated basis with its Subsidiaries, (i) had assets as of the last day of the Fiscal Quarter that exceeded the amount set forth Item C.1 or (ii) was responsible for a portion of the Consolidated Operating Income of the Company and its Subsidiaries for the Fiscal Quarter in excess of the amount set forth in Item C.2 and (b) indicate on Exhibit A hereto whether any Equity Interests in any such Foreign Subsidiary have not been pledged to the Agent as and to the extent required pursuant to Section 6.21(b). |
D. | ADDITIONAL GUARANTORS AND PLEDGED FOREIGN SUBSIDIARIES (SECTION 6.21(c)) |
1. | 85.0% of the aggregate assets of the Company and its Domestic Subsidiaries (other than Equity Interests in Subsidiaries) as of the last day of the Fiscal Quarter $_________ |
2. | The aggregate assets (other than Equity Interests in Subsidiaries) of the Company and the Domestic Subsidiary Guarantors as of the last day of the Fiscal Quarter $_________ |
3. | Does Item D.i.2 exceed Item D.i.1? Yes/No |
4. | 85.0% of the aggregate operating income of the Company and its Domestic Subsidiaries for the Fiscal Quarter $_________ |
5. | The operating income of the Company and the Domestic Subsidiary Guarantors for the Fiscal Quarter $_________ |
6. | Does Item D.i.5 exceed Item D.i.4? Yes/No |
1. | If the answer indicated in either of Item D.i.3 or D.i.6 is “No”, indicate on Exhibit B hereto additional Domestic Subsidiaries that shall become Domestic Subsidiary Guarantors in accordance with Section 6.21(a) or 6.21(c) and/or additional Foreign Subsidiaries the Equity Interests of which shall be pledged in accordance with Section 6.21(b), in each case such that, after giving effect to such additional Guarantors and Collateral (and the compliance of any additional Domestic Subsidiaries with the terms of Sections 6.21(a) and the pledge of Equity Interests of any additional Foreign Subsidiaries pursuant to Section 6.21(b)), the calculations set forth in this Section D would result in the answers set forth in such Items being “Yes”. |
2. | Provide on Exhibit B hereto detailed calculations demonstrating, as applicable, either (i) that the answer indicated in both Items D.i.3 and D.i.6 is “Yes” or (ii) compliance with the foregoing Item D.ii.1. |
_________________________ | ________________________ |
Facility Assigned (Revolving/Term) | Aggregate Amount of Commitment/Loans for all Lenders* | Amount of Commitment/Loans Assigned* | Percentage Assigned of Commitment/Loans |
$ | $ | _______% | |
$ | $ | _______% | |
$ | $ | _______% |
ASSIGNOR | ||
[NAME OF ASSIGNOR] | ||
By:_________________________________ | ||
Title: | ||
ASSIGNEE | ||
[NAME OF ASSIGNEE] | ||
By:_________________________________ | ||
Title: | ||
Consented to and Accepted: | ||
JPMORGAN CHASE BANK, N.A., as Agent [, as LC Issuer and as Swing Line Lender] | ||
By:____________________________ | ||
Title: |
Consented to and Accepted: | ||
JPMORGAN CHASE BANK, N.A., as Agent [, LC Issuer and Swing Line Lender] | ||
By:____________________________ | ||
Title: |
[ACTUANT CORPORATION] | |
[FOREIGN SUBSIDIARY BORROWER] | |
By: | |
Name: | |
Title: | |
Date | Principal Amount of Loan | Maturity of Interest Period | Principal Amount Paid | Unpaid Balance |
ACTUANT CORPORATION | |
By: | |
Name: | |
Title: | |
Date | Principal Amount of Loan | Maturity of Interest Period | Principal Amount Paid | Unpaid Balance |
1. | We refer to the Agreement. Terms defined in the Agreement have the same meaning in this certificate unless given a different meaning in this certificate. |
(xi) | a Lender: |
(i) | which is a bank (as defined for the purpose of section 879 of the Income Tax Act 2007) making an advance under a Loan Document; or |
(b) | (i) in respect of an advance made under a Loan Document by a person that was a bank (as defined for the purpose of section 879 of the Income Tax Act 2007) at the time that that advance was made, |
(i) | and which is within the charge to United Kingdom corporation tax as respects any payments of interest made in respect of that advance |
(i) | a company so resident in the United Kingdom; or |
(c) | (ii) a company not so resident in the United Kingdom which carries on a trade in the United Kingdom through a permanent establishment and which is required to bring into account in computing its chargeable profits (for the purposes of section 19 of the Corporation Tax Act 2009) the whole of any share of interest payable in respect of that advance that falls to it by reason of Part 17 of the Corporation Tax Act 2009; or |
4. | The New Lender confirms (for the benefit of the Agent and without liability to any Borrower) that it is a Treaty Lender that holds a passport under the HMRC DT Treaty Passport scheme (reference number [ ]),]) and is tax resident in [ ], so that interest payable to it by borrowers is generally subject to full exemption from UK withholding tax and notifies the UK Borrowers that: |
Material Domestic Subsidiary (each a Subsidiary Guarantor) | Jurisdiction of Organization |
Actuant Electrical, Inc. | New York |
Actuant International Holdings, Inc. | Delaware |
Engineered Solutions, L.P. | Indiana |
Subsidiary Guarantor | Jurisdiction of Organization |
Applied Power Investments II, Inc. | Nevada |
B.W. Elliott Manufacturing Co., LLC | New York |
Electrical Holdings LLC | Delaware |
Cortland Company, Inc. | Delaware |
GB Tools & Supplies, LLC | Delaware |
Hydratight Operations, Inc | Delaware |
Maxima Holding Company, Inc. | Delaware |
Maxima Holdings – Europe, Inc. | Delaware |
Maxima Technologies & Systems, LLC | Delaware |
Precision Sure-Lock, Inc. | Delaware |
PSL Holdings, Inc. | Texas |
Sanlo, Inc. | Delaware |
Versa Technologies, Inc. | Delaware |
Material Foreign Subsidiary | Jurisdiction of Organization |
Actuant Europe Holdings SAS | France |
Enerpac GmbH | Germany |
Foreign Subsidiary | Jurisdiction of Organization |
Actuant International Limited. | U.K. |
Actuant Finance Limited | U.K. |
Actuant Limited | U.K. |
Actuant Acquisitions Limited | U.K. |
Actuant Global Sourcing, Ltd. | Hong Kong |
Foreign Law Pledgor | Jurisdiction | Pledged Subsidiary | Pledged Subsidiary’s Jurisdiction |
Actuant International Holdings, Inc. | Delaware | Actuant Europe Holding SAS | France |
Actuant Europe Holding SAS | France | Actuant International Limited. | U.K. |
Actuant International Limited | U.K. | Actuant Finance Limited | U.K. |
Actuant Limited | U.K. | ||
Engineered Solutions, L.P. | Indiana | Enerpac GmbH | Germany |
GB Tools & Supplies, LLC | Delaware | Actuant Global Sourcing, Ltd. | Hong Kong |
(i) | Securities Accounts Pledge Agreement by Actuant International Holdings, Inc. over its shares in Actuant Europe Holding SAS in favor of JPMorgan Chase Bank, N.A. |
(ii) | Mortgage over Shares by Actuant Europe Holdings SAS, over its shares in Actuant International Limited, in favor of JPMorgan Chase Bank, N.A. as affirmed by Letter of Affirmation dated as of the Closing Date. |
(iii) | Mortgage over Shares by Actuant International Limited over its shares in Actuant Limited, in favor of JPMorgan Chase Bank, N.A. as affirmed by Letter of Affirmation dated as of the Closing Date. |
(iv) | Mortgage over Shares entered into by Actuant International Limited over its shares in Actuant Finance Limited, in favor of JPMorgan Chase Bank, N.A. as affirmed by Letter of Affirmation dated as of the Closing Date. |
(v) | Mortgage over Shares entered into by Actuant Corporation over its shares in Actuant Acquisitions Limited, in favor of JP Morgan Chase bank, N.A. as affirmed by Letter of Affirmation dated as of the Closing Date. |
(vi) | Share Pledge Agreement by Engineered Solutions, L.P. over its shares in Enerpac GmbH, to be entered into on a post-closing basis pursuant to section 6.21(g) of the Credit Agreement. |
(vii) | Mortgage of Shares by GB Tools & Supplies, LLC over its shares in Actuant Global Sourcing, Ltd. |
(i) | Lease of the Kahl, Germany campus of Heinrich Kopp GmbH, which the Company subleases to Heinrich Kopp GmbH. |
(ii) | Lease by Acme Electrical, Inc. of 131 Enterprise Drive, Edwardsville, Illinois. |
(iii) | Lease by Acme Electrical, Inc. of 1739 Commerce Drive, Creston, Iowa; |
(iv) | Lease by Maxima Technologies & Systems, LLC of 1811 Rohrerstown Road, Lancaster, Pennsylvania. |
Bank | Beneficiary | Original Issue Date | LOC Number | USD Equivalent Amount | Expiration/ Next Renewal |
JPM | Doosan Heavy Industries | 05/14/12 | CPCS-209073 | $23,520 | 08/01/13 |
JPM | Doosan Heavy Industries | 05/14/12 | CPCS-209091 | $30,800 | 10/01/13 |
JPM | Doosan Heavy Industries | 05/11/12 | CPCS-209108 | $15,400 | 10/01/13 |
JPM | Doosan Heavy Industries | 05/11/12 | CPCS-209110 | $11,760 | 08/01/13 |
JPM | JPMorgan Chase Bank, N.A. | 04/19/13 | CPCS-237180 | $10,246 | 01/28/14 |
JPM | Erste Group Bank | 08/22/12 | CPCS-308106 | $16,038.40 | 09/30/13 |
JPM | JPMorgan Chase Bank, N.A. | 10/19/12 | CPCS-378061 | $2,232,000 | 02/04/14 |
A. | LOAN DOCUMENTS |
1. | Fourth Amended and Restated Credit Agreement (the “Credit Agreement”), by and among Actuant Corporation, a Wisconsin corporation (the “Company”), the Foreign Subsidiary Borrowers party thereto (together with the Company, the “Borrowers”), the lenders from time to time party thereto (the “Lenders”), and JPMorgan Chase Bank, N.A., as administrative agent and contractual representative of the Lenders (the “Agent”). |
2. | Revolving Loan Notes, if requested, executed by the Borrowers in favor of the Revolving Lenders in the aggregate principal amounts of such Revolving Lenders’ Revolving Loan Commitments under the Credit Agreement. |
3. | Term Loan Notes, if requested, executed by the Company in favor of the Term Lenders in the aggregate principal amounts of such Term Lenders’ Term Loan Commitments under the Credit Agreement. |
4. | Fifth Amended and Restated Subsidiary Guaranty executed by each Domestic Subsidiary Guarantor of the Company identified on Annex 1 hereto (the “Initial Domestic Subsidiary Guarantors”) in favor of the Agent, guaranteeing the payment of the Secured Obligations. |
5. | Second Amended and Restated UK Borrower Guaranty executed by each UK Borrower identified on Annex 1 hereto evidencing the guaranty by each UK Borrower of the Obligations of each other Foreign Subsidiary Borrower. |
6. | Second Amended and Restated Pledge and Security Agreement executed by the Company and each Initial Domestic Subsidiary Guarantor (collectively, the “Initial Grantors”) in favor of the Agent. |
7. | Second Amended and Restated Contribution Agreement executed by each Borrower and each Initial Domestic Subsidiary Guarantor in favor of the Agent. |
8. | Letters of Affirmation of the existing four Mortgages over Shares (U.K.). |
9. | Certificates of Insurance listing the Agent as (x) lender loss payee for the “all risk” property, casualty and business interruption insurance policies of the Initial Grantors, together with long-form lender loss payable endorsement, and (y) additional insured with respect to the liability insurance of the Initial Grantors, together with an additional insured endorsement. |
B. | UCC DOCUMENTS |
10. | Copies of previously filed UCC financing statements and amendments filed against each Initial Grantor, as debtor, and the Agent, as secured party, in the offices listed on Annex 2 hereto, including UCC-1 for Cortland Company, Inc. |
11. | Additional UCC filings: |
12. | UCC, tax lien, judgment and name variation search reports naming each Initial Grantor (and certain former names or pre-merger entities, as appropriate) from the appropriate offices in those jurisdictions identified in Annex 3 hereto, and confirming that each of the filings identified in the immediately preceding two items are of record in the appropriate jurisdictions. |
C. | CORPORATE DOCUMENTS |
13. | Certificate of the Secretary of the Company certifying (i) resolutions of the Board of Directors of the Company authorizing the execution, delivery and performance of each Loan Document to which it is a party, (ii) that there have been no changes in the Certificate of Incorporation of the Company, as attached thereto and as certified as of a recent date by the Secretary of State of Wisconsin, since the date of the certification thereof by the Secretary of State of Wisconsin, (iii) the names and true signatures of the incumbent officers of the Company authorized to sign the Loan Documents to which it is a party and authorized to request Credit Extensions under the Credit Agreement and (iv) the By-Laws, as attached thereto, of the Company as in effect on the date of such certification. |
14. | Certificate of Good Standing for the Company from the office of the Secretary of State of Wisconsin. |
15. | Certificate of the Secretary of each Initial Domestic Subsidiary Guarantor certifying (i) resolutions of the Board of Directors or equivalent governing body of such Initial Domestic Subsidiary Guarantor, approving and authorizing the execution, delivery and performance of each Loan |
16. | Good Standing Certificates (or the equivalents thereof) for each Initial Domestic Subsidiary Guarantor from the offices of the Secretaries of State (or the equivalents thereof) in the respective jurisdictions set forth on Annex 1 hereto. |
17. | Officer’s Certificate of each UK Borrower certifying (i) resolutions of the Board of Directors of such UK Borrower, approving and authorizing the execution, delivery and performance of each Loan Document to which it is a party, (ii) the constitutional documents of such UK Borrower, as attached thereto as in effect on the date of such certification and (iii) the names and true signatures of the incumbent officers of such UK Borrower, as applicable, authorized to sign the Loan Documents to which it is a party. |
18. | Officer’s Certificate of Actuant Europe Holding SAS certifying (i) resolutions of the Board of Directors of Actuant Europe Holding SAS, approving and authorizing the execution, delivery and performance of each Loan Document to which it is a party, (ii) the constitutional documents of Actuant Europe Holding SAS, as attached thereto as in effect on the date of such certification and (iii) the names and true signatures of the incumbent officers of Actuant Europe Holding SAS, as applicable, authorized to sign the Loan Documents to which it is a party. |
D. | LEGAL OPINIONS |
19. | Opinion of McDermott, Will & Emery LLP, counsel to the Company, with respect to issues of Illinois, New York, Texas, Delaware and, as it relates to UCC issues, Indiana and Nevada law. |
20. | Opinion of Quarles & Brady LLP, counsel to the Company, with respect to issues of Wisconsin law. |
21. | Opinion of Williams & Associates Law Firm, PC, counsel to the Company, with respect to issues of Indiana law. |
22. | Opinion of McDermott, Will & Emery LLP, counsel to the Loan Parties, with respect to issues of UK law. |
E. | CLOSING CERTIFICATE AND MISCELLANEOUS |
23. | A certificate, signed by a Financial Officer of the Company, stating that on the initial Credit Extension Date (a) the representations and warranties contained in Article V of the Credit Agreement are true and correct and (b) no Default or Unmatured Default has occurred and is continuing. |
24. | Opening Pro Forma Compliance Certificate, signed by a Financial Officer of the Company, showing the calculations necessary to determine compliance with Sections 6.19 and 6.21 of the Credit Agreement, which calculations shall be prepared in a manner acceptable to the Agent and the Lenders. |
F. | POST-CLOSING |
25. | Affirmations or replacements of the following foreign law pledge agreements, together with corporate deliveries and legal opinions, as requested: |
Borrower/Grantor | Jurisdiction |
Actuant Corporation | Wisconsin |
Domestic Subsidiary Guarantor/Grantor | Jurisdiction |
Actuant Electrical, Inc. | New York |
Actuant International Holdings, Inc. | Delaware |
Applied Power Investments II, Inc. | Nevada |
B.W. Elliott Manufacturing Co., LLC | New York |
Cortland Company, Inc. | Delaware |
Electrical Holdings LLC | Delaware |
Engineered Solutions, L.P. Engineered Solutions L.P. | Indiana |
GB Tools & Supplies, LLC | Delaware |
Hydratight Operations, Inc. | Delaware |
Maxima Holding Company, Inc. | Delaware |
Maxima Holdings – Europe, Inc. | Delaware |
Maxima Technologies & Systems, LLC Maxima Technologies & Systems LLC | Delaware |
Precision Sure-Lock, Inc. | Delaware |
PSL Holdings, Inc. | Texas |
Sanlo, Inc. | Delaware |
Versa Technologies, Inc. | Delaware |
Borrower | Jurisdiction |
Actuant Finance Ltd. | U.K. |
Actuant Ltd. | U.K. |
Foreign Law Pledgor | Jurisdiction | Pledged Subsidiary | Pledged Subsidiary’s Jurisdiction |
Actuant International Holdings, Inc. | Delaware | Actuant Europe Holding SAS | France |
Actuant Europe Holding SAS | France | Actuant International Limited | U.K. |
Actuant International Limited | U.K. | Actuant Finance Limited | U.K. |
Actuant Limited | U.K. | ||
Actuant Corporation | Wisconsin | Actuant Acquisitions Limited | U.K. |
Engineered Solutions, L.P. | Indiana | Enerpac GmbH | Germany |
GB Tools & Supplies, LLC | Delaware | Actuant Global Sourcing, Ltd. | Hong Kong |
Name | Type of Search | Jurisdiction |
Actuant Corporation | UCC/TL/J | Wisconsin SOS |
STL/FTL | Waukesha County, Wisconsin Milwaukee County, Wisconsin | |
SPSJ/FPSJ | Waukesha County, Wisconsin Milwaukee County, Wisconsin | |
“Actuant” | Name Variation | Wisconsin SOS |
ACTUANT HOLDINGS, LLC | UCC/TL/J | Delaware SOS |
STL/FTL | Waukesha County, Wisconsin Milwaukee County, Wisconsin | |
SJ/FJ | Waukesha County, Wisconsin Milwaukee County, Wisconsin | |
“Actuant” | Name Variation | Delaware SOS |
Acme Electric, LLC | UCC/TL/J | Delaware SOS |
STL/FTL | Wisconsin SOS Illinois SOS North Carolina SOS Waukesha County, Wisconsin McHenry County, Illinois Robeson County, North Carolina | |
SJ/FJ | Waukesha County, Wisconsin McHenry County, Illinois Robeson County, North Carolina | |
Name Variation | Delaware SOS Wisconsin SOS Illinois SOS North Carolina SOS | |
Actuant Electrical, Inc. | UCC/TL/J | New York SOS |
STL/FTL | Wisconsin SOS Iowa SOS Illinois SOS California SOS Connecticut SOS Waukesha County, Wisconsin Union County, Iowa Madison County, Illinois Napa County, California Hartford County, Connecticut (Berlin) | |
SJ/FJ | Waukesha County, Wisconsin Union County, Iowa Madison County, Illinois Napa County, California Hartford County, Connecticut (Berlin) |
“Actuant Electric” | Name Variation | New York SOS California SOS Connecticut SOS Illinois SOS Iowa SOS Wisconsin SOS |
Actuant International Holdings, Inc. | UCC/TL/J | Delaware SOS |
STL/FTL | Wisconsin SOS Waukesha County, Wisconsin | |
SJ/FJ | Waukesha County, Wisconsin | |
Applied Power Investments II, Inc. | UCC/TL/J | Nevada SOS |
STL/FTL | Wisconsin SOS Waukesha County, Wisconsin Milwaukee County, Wisconsin | |
SJ/FJ | Waukesha County, Wisconsin Milwaukee County, Wisconsin | |
Name Variation | Nevada SOS Wisconsin SOS | |
B.W. Elliott Manufacturing Co., LLC | UCC/TL/J | New York SOS |
STL/FTL | Wisconsin SOS Waukesha County, Wisconsin Broome County, New York | |
SJ/FJ | Waukesha County, Wisconsin Broome County, New York | |
“bw el ma”; bw elliot”; “elliott manufa” | Name Variation | New York SOS Wisconsin SOS |
Cortland Company, Inc. | UCC/TL/J | Delaware SOS |
STL/FTL | Wisconsin SOS Texas SOS Waukesha County, Wisconsin Fort Bend County, Texas | |
SJ/FJ | Waukesha County, Wisconsin Fort Bend County, Texas | |
“Cortland” | Name Variation | Texas SOS Delaware SOS Wisconsin SOS |
The Cortland Companies, Inc. | UCC/TL/J | Delaware SOS |
STL/FTL | Wisconsin SOS Texas SOS Waukesha County, Wisconsin Fort Bend County, Texas | |
SJ/FJ | Waukesha County, Wisconsin Fort Bend County, Texas | |
Cortland Cable Company, Inc. | UCC/TL/J | New York SOS |
STL/FTL | Wisconsin SOS Waukesha County, Wisconsin Cortland County, New York | |
SJ/FJ | Waukesha County, Wisconsin Cortland County, New York | |
Cortland Holding Company | UCC/TL/J | Delaware SOS |
STL/FTL | Wisconsin SOS New York SOS Waukesha County, Wisconsin Cortland County, New York | |
SJ/FJ | Waukesha County, Wisconsin Cortland County, New York | |
Viking Rope Corporation | UCC/TL/J | Washington SOS |
STL/FTL | Wisconsin SOS New York SOS Waukesha County, Wisconsin Cortland County, New York | |
SJ/FJ | Waukesha County, Wisconsin Cortland County, New York | |
Name Variation | Washington SOS | |
ENGINEERED SOLUTIONS, L.P. | UCC/TL/J | Indiana SOS |
STL/FTL | Wisconsin SOS Waukesha County, Wisconsin St. Joseph County, Indiana | |
SJ/FJ | Waukesha County, Wisconsin St. Joseph County, Indiana | |
Name Variation | Indiana SOS Wisconsin SOS | |
Engineered Solutions L.P. | Please search only in jurisdictions listed directly above that do not consider a comma a noise word | |
GB Tools & Supplies, LLC | UCC/TL/J | Delaware SOS |
STL/FTL | Wisconsin SOS Waukesha County, Wisconsin Milwaukee County, Wisconsin | |
SJ/FJ | Waukesha County, Wisconsin Milwaukee County, Wisconsin | |
Name Variation | Delaware SOS Wisconsin SOS | |
Hydratight Operations, Inc. | UCC/TL/J | Delaware SOS |
STL/FTL | Wisconsin SOS Texas SOS Waukesha County, Wisconsin Orange County, Texas | |
SJ/FJ | Waukesha County, Wisconsin Orange County, Texas | |
Name Variation | Delaware SOS Wisconsin SOS Texas SOS |
Maxima Holding Company, Inc. | UCC/TL/J | Delaware SOS |
STL/FTL | Wisconsin SOS Waukesha County, Wisconsin Lancaster County, Pennsylvania | |
SJ/FJ | Waukesha County, Wisconsin Lancaster County, Pennsylvania | |
“Maxima Holdin” | Name Variation | Delaware SOS Wisconsin SOS Pennsylvania SOS |
Maxima Holdings – Europe, Inc. | UCC/TL/J | Delaware SOS |
STL/FTL | Wisconsin SOS Waukesha County, Wisconsin Lancaster County, Pennsylvania | |
SJ/FJ | Waukesha County, Wisconsin Lancaster County, Pennsylvania | |
Maxima Technologies & Systems, LLC | UCC/TL/J | Delaware SOS |
STL/FTL | Wisconsin SOS Waukesha County, Wisconsin Lancaster County, Pennsylvania | |
SJ/FJ | Waukesha County, Wisconsin Lancaster County, Pennsylvania | |
“Maxima Techno” | Name Variation | Delaware SOS Wisconsin SOS Pennsylvania SOS |
Maxima Technologies & Systems LLC | Please search only in jurisdictions listed directly above that do not consider a comma a noise word | |
Precision Sure-Lock, Inc. | UCC/TL/J | Delaware SOS |
STL/FTL | Wisconsin SOS Texas SOS Waukesha County, Wisconsin Dallas County, Texas | |
SJ/FJ | Waukesha County, Wisconsin Dallas County, Texas | |
Name Variation | Delaware SOS Wisconsin SOS Texas SOS | |
PSL Holdings, Inc. | UCC/TL/J | Texas SOS |
STL/FTL | Wisconsin SOS Waukesha County, Wisconsin Dallas County, Texas | |
SJ/FJ | Waukesha County, Wisconsin Dallas County, Texas | |
Name Variation | Texas SOS Wisconsin SOS | |
Sanlo, Inc. | UCC/TL/J | Delaware SOS |
STL/FTL | Wisconsin SOS Waukesha County, Wisconsin LaPorte County, Indiana | |
SJ/FJ | Waukesha County, Wisconsin LaPorte County, Indiana | |
Name Variation | Delaware SOS Wisconsin SOS Indiana SOS | |
Templeton, Kenly & Co., Inc. | UCC/TL/J | Illinois SOS |
STL/FTL | Wisconsin SOS Waukesha County, Wisconsin Cook County, Illinois | |
SJ/FJ | Waukesha County, Wisconsin Cook County, Illinois | |
Name Variation | Illinois SOS Wisconsin SOS | |
Versa Technologies, Inc. | UCC/TL/J | Delaware SOS |
STL/FTL | Wisconsin SOS Waukesha County, Wisconsin Milwaukee County, Wisconsin | |
SJ/FJ | Waukesha County, Wisconsin Milwaukee County, Wisconsin | |
Name Variation | Delaware SOS Wisconsin SOS | |
ACTUANT CORPORATION, | |
as a Borrower | |
By: /s/ Terry M. Braatz | |
Name: Terry M. Braatz | |
Title: Treasurer | |
ACTUANT LIMITED, | |
as a Borrower | |
By: /s/ Jan de Koning | |
Name: Jan de Koning | |
Title: Director | |
ACTUANT FINANCE LIMITED, | |
as a Borrower | |
By: /s/ Jan de Koning | |
Name: Jan de Koning | |
Title: Director | |
JPMORGAN CHASE BANK, N.A., | |
as a Lender and as Agent | |
By: /s/ Richard Barritt | |
Name: Richard Barritt | |
Title: Associate | |
BANK OF AMERICA, N.A., | |||
as a Lender | |||
By: /s/ Marc Sanchez | |||
Name: Marc Sanchez | |||
Title: Vice President | |||
WELLS FARGO BANK, N.A., | |||
as a Lender | |||
By: /s/ Thomas P. Trail | |||
Name: Thomas P. Trail | |||
Title: Director | |||
U.S. BANK NATIONAL ASSOCIATION, | |||
as a Lender | |||
By: /s/ Caroline V. Krider | |||
Name: Caroline V. Krider | |||
Title: Senior Vice President | |||
KEYBANK NATIONAL ASSOCIATION, | |
as a Lender | |
By: /s/ Brian P. Fox | |
Name: Brian P. Fox | |
Title: Vice President | |
BMO HARRIS BANK, N.A., |
as a Lender |
By: /s/ Ronald J. Carey |
Name: Ronald J. Carey |
Title: Senior Vice President |
SUNTRUST BANK, | |
as a Lender | |
By: /s/ Johnetta Bush | |
Name: Johnetta Bush | |
Title: Vice President | |
RBS CITIZENS, N.A., | |
as a Lender | |
By: /s/ Jeffrey P. Huening | |
Name: Jeffrey P. Huening | |
Title: Vice President | |
PNC BANK, NATIONAL ASSOCIATION, | |
as a Lender | |
By: /s/ Henry Hissrich | |
Name: Henry Hissrich | |
Title: Vice President | |
ROYAL BANK OF CANADA, | |
as a Lender | |
By: /s/ Ian C. Blaker | |
Name: Ian C. Blaker | |
Title: Authorized Signatory | |
BRANCH BANKING AND TRUST COMPANY, | |
as a Lender | |
By: /s/ Kurt W. Anstaett | |
Name: Kurt W. Anstaett | |
Title: Senior Vice President | |
THE NORTHERN TRUST COMPANY, | |||
as a Lender | |||
By: /s/ Patrick Cowan | |||
Name: Patrick Cowan | |||
Title: Senior Vice President | |||
ASSOCIATED BANK, N.A., | |
as a Lender | |
By: /s/ Daniel R. Holzhauer | |
Name: Daniel R. Holzhauer | |
Title: Senior Vice President | |
1.1 | “Annual Deferral Amount” shall mean that portion of a Participant’s compensation that a Participant elects to have and is actually deferred for any annual term of office. |
1.2 | “Board of Directors”, “Directors” or “Director” shall mean, respectively, the Board of Directors, the Directors or a Director of the Company. |
1.3 | “Committee” shall mean the Compensation Committee of the Board of Directors. |
1.4 | “Company” shall mean Actuant Corporation. |
1.5 | “Deferred Shares” shall mean the units credited to Deferred Shares Accounts. The Market Price of Deferred Shares shall be equal to the Market Price of Shares. |
1.6 | “Deferred Shares Account” or “Account” shall mean the separate account established under the Plan for each Participant, as described in Section 3.2. |
1.7 | “Market Price” shall mean the closing sale price for Shares on a specified date or, if Shares were not then traded, on the most recent prior date when Shares were traded, all as is quoted in The Wall Street Journal reports of New York Stock Exchange Composite Transactions. |
1.8 | “Notice Form” shall mean the form attached hereto and marked as Exhibit A or any other document which incorporates information substantially similar to Exhibit A. |
1.9 | “Participant” shall mean each Director of the Company who participates in the Plan in accordance with its terms and conditions. |
1.10 | “Plan” shall mean the Actuant Corporation Outside Directors’ Deferred Compensation Plan as set forth herein, or as it may be amended from time to time by the Board of Directors. |
1.11 | “Shares” shall mean shares of Common Stock of the Company. |
1.12 | “Short-Term Payout” shall mean the payout set forth in Section 4. |
1.13 | “Treasurer” shall mean the Treasurer of the Company who shall have responsibility for those functions assigned under the Plan. |
2.1 | The Company maintains the Plan for the benefit of non-employee Directors of the Company, to provide such Directors with certain deferred compensation benefits. Each Director who receives compensation under Section 3.1 is eligible to participate in the Plan. The Plan is designed to comply with the American Jobs Creation Act of 2004, as amended (the “Jobs Act”), and Section 409A of the Code, and final Treasury regulations issued thereunder, with respect to Non-Grandfathered Amounts under the Plan. “Grandfathered Amounts” shall mean the portion of the Participant’s Deferred Shares Account balance under the Plan as of December 31, 2004, the right to which was earned and vested (within the meaning of Treasury Regulation §1.409A-6(a)(2)) as of December 31, 2004, plus the right to future contributions to the Account the right to which was earned and vested (within the meaning of Treasury Regulation. §1.409A-6(a)(2)) as of December 31, 2004, to the extent such contributions are actually made, each determined by reference to the terms of the Plan in effect as of October 3, 2004, but only to the extent such Plan terms have not been materially modified (within the meaning of Treasury Regulation §1.409A-6(a)(4)) after October 3, 2004. Grandfathered Amounts shall include any earnings (within the meaning of Treasury Regulation. §1.409A-1(o)) attributable thereto. “Non-Grandfathered Amounts” shall mean the Participant’s Account balance under the Plan less any portion of the Participant’s Deferred Shares Account balance under the Plan constituting Grandfathered Amounts. Prior to January 1, 2009, it is intended that the Plan be interpreted according to a good faith interpretation of the Jobs Act and Section 409A of the Code, and consistent with published guidance thereunder, including, without limitation, IRS Notice 2005-1 and the proposed and final Treasury regulations under Section 409A of the Code. Treatment of amounts deferred under the Plan pursuant to and in accordance with any transition rules provided under all IRS published guidance and other applicable authorities in connection with the Jobs Act or Section 409A of the Code, including, without limitation, the adoption of the transition rules prescribed under Q&As 20 and 21 of IRS Notice 2005-1, shall be expressly authorized hereunder and shall be administered in accordance with procedures established by the Company or the Committee, as the case may be. In the event of any inconsistency between the terms of the Plan and the Jobs Act or Section 409A of the Code with respect to Non-Grandfathered Amounts, the terms of the Jobs Act and Section 409A of the Code shall prevail and govern. |
2.2 | (1) Each eligible Director may elect to participate in the Plan by giving a properly completed Notice Form to the Treasurer. The effective date for his |
3.1 | A Participant may elect that the payment of all or a specified portion of the compensation otherwise payable to him in cash for services as a Director be deferred pursuant to the terms of this Plan. Such compensation includes retainer fees and attendance fees but does not include travel expense allowance or any other expense reimbursement. At the time of making any such election, a Participant shall elect that such compensation be deferred in the form of a Deferred Shares Account. |
3.2 | (a) A Deferred Shares Account shall be established for each Participant which shall be credited with the number of Shares that could be acquired with the amount deferred by the Participant under Section 3.1 above. (b) In the event of a reorganization, recapitalization, stock split, stock dividend, combination of shares, merger, consolidation, rights offering or any other change in the corporate structure or Shares of the Company, the Committee shall make such adjustment, if any, as it may deem appropriate in the number and kinds of Deferred Shares credited to the Deferred Shares Account. |
3.3 | Each Participant will receive a statement of the balance in his Account not less frequently than annually. |
4.1 | A participant may elect to receive a future Short-Term Payout from the Plan with respect to the Annual Deferral Amount. The Short-Term Payout shall be a lump sum distribution of Shares equal to the number of the Deferred Shares in the Deferred Shares Account. Subject to the other terms and conditions of this Plan, |
5.1 | Upon the termination of a Participant’s services as a Director, the payment of the Deferred Shares remaining in his Deferred Shares Account shall commence within 60 days following the date the Participant ceases to be a Director and shall be paid in accordance with the method elected by the Participant on the applicable Notice Form or Forms, as provided in Section 5.2. |
5.2 | Subject to Section 2.2 and this Section 5, and except as provided in Section 4.1 a Participant may elect any of the following methods of payment of the balance or balances in his Account: |
5.3 | In the event of a Participant’s death before the balance in his Account is fully paid out, payment of such balance shall be made to the beneficiary or beneficiaries designated by the Participant or, if the Participant has made no such designation or no beneficiary survives, to the Participant’s estate. In either case, such payment shall be made in the same manner as provided with respect to payments to the Participant. |
5.4 | To the extent required by law in effect at the time any distribution is made from the Plan, the Company shall withhold any taxes and such other amounts required to be withheld by Federal, state or local governments. Further, to the extent |
5.5 | If any individual to whom a benefit is payable under the Plan is a minor or legally incompetent, the Company or the Committee shall determine whether payment shall be made directly to the individual, any person acting as his or her custodian or legal guardian under the Uniform Transfers to Minors Act, his or her legal representative or a near relative, or directly for his or her support, maintenance or education. Any payment made in accordance with the preceding sentence shall be a complete discharge of any and all obligations to make such payment under the Plan on behalf of such individual. |
5.6 | Each Participant and (in the event of death) his or her Beneficiary shall keep the Company advised of his or her current address. If the Company is unable to locate a Participant to whom a Participant’s Account is payable under this Section 5, the Participant’s Account shall be held in suspense pending location of the Participant, without any prejudice to the Committee or the Company (and each of their respective authorized delegates), as the case may be, including, without limitation, for any additional tax liability resulting from such delay in payment. If the Company is unable to locate a Beneficiary to whom a Participant’s Account is payable under this Section 5 within six (6) months (or, with respect to a Participant’s Non-Grandfathered Amounts, such other period during which payment must commence under this Section 5 or, if later, such other period permitted under Section 409A of the Code) of the Participant’s death, the Participant’s Account shall be paid to the Participant’s estate. |
6.1 | The Company shall establish a rabbi trust (the “Trust”) to fund its future liability under the Plan. The Plan terms shall govern the rights of a Participant to receive distributions from the Plan. The Trust terms shall govern the rights of the Company, Participants and the creditors of the Company to the Trust assets. Participants and their beneficiaries shall have no legal or equitable rights, interests or claims in any property or assets of the Company. The right of any Participant or beneficiary to receive payment of any unpaid balance in any Account of the Participant shall be an unsecured claim against the general assets of the Company. |
6.2 | During a Participant’s lifetime, any payment under the Plan shall be made only to him. No sum or other interest under the Plan shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance or charge, and any attempt by a Participant or any beneficiary under the Plan to do so shall be void. No interest under the Plan shall in any manner be liable for or subject to the debts, contracts, liabilities, engagements or torts of a Participant or beneficiary entitled thereto. |
6.3 | Except as otherwise provided herein, the Plan shall be administered by the Committee which shall have the authority, subject to the express provisions of the Plan, to adopt, amend and rescind rules and regulations relating to the Plan, and to interpret, construe and implement the provisions of the Plan. Notwithstanding the foregoing, the Committee shall retain and exercise such discretion reserved hereunder only to the extent such retention and exercise of discretion does not violate the requirements of Section 409A of the Code with respect to a Participant’s Non-Grandfathered Amounts. |
6.4 | The Plan may at any time or from time to time be amended, modified, or terminated by the Board of Directors, provided that no amendment, modification or termination shall (a) adversely affect the balance in a Participant’s Deferred Shares Account without his consent or (b) permit payment of such balance prior to the date specified pursuant to Sections 4.1 and 5.2 (except for payments provided in Section 6.5) without his consent. |
6.5 | If the Plan is terminated pursuant to this Section 6, the balances credited to the Accounts of the affected Participants shall be distributed to them at the time and in the manner set forth in Section 5; provided, however, that the Committee, in its sole discretion, may authorize accelerated distribution of Participants’ Accounts as of any earlier date; provided that with respect to Non-Grandfathered Amounts, such discretion reserved to the Committee to accelerate the form and timing of the distribution of Participants’ Accounts shall be exercised only to the extent the termination of the Plan arises pursuant to and in accordance with one of the following provisions: |
6.6 | The Company shall, and hereby does, indemnify and hold harmless the Committee, the Company, and the members of the Committee (and each of their respective authorized delegates), from and against any and all losses, claims, damages or liabilities (including attorneys’ fees and amounts paid in settlement of any claim) arising out of or resulting from the implementation of a duty, act or decision with respect to the Plan, so long as such duty, act or decision does not involve gross negligence or willful misconduct on the part of the Committee, the Company, or any such member of the Committee. |
EXECUTIVE: /s/ David L. Scheer David L. Scheer | ACTUANT CORPORATION By: /s/ Sherri Grissom Title: Executive VP – Human Resources |
If EBITDA is: | then Performance Bonus Amount is: | |
[* * *] | $ 0 | |
[* * *] | $ 62,500 (25%) | |
[* * *] | $125,000 (50%) | |
[* * *] | $187,500 (75%) | |
[* * *] | $250,000 (100%) | |
*Amounts will be interpolated between performance levels |
If the Sales Proceeds are: | then the Sale Bonus Amount is: | |
[* * *] | $0 | |
[* * *] | $100,000 | |
[* * *] | $150,000 | |
[* * *] | $200,000 | |
[* * *] | $250,000 | |
[* * *] | $300,000 | |
[* * *] | $350,000 | |
[* * *] | $400,000 | |
[* * *] | $450,000 | |
[* * *] | $500,000 | |
*Amounts will be interpolated between performance targets |
ACTUANT CORPORATION | |||||
By: | /s/ Mark Goldstein | ||||
Acknowledged and Agreed: | |||||
/s/ David L. Scheer | |||||
David L. Scheer | |||||
Exhibit 10.13 |
Subject: | Consulting Services Agreement |
Services | Subject to the terms and conditions set forth below, the Company will engage you to provide consulting services (“Services”) for the benefit of the Company in the areas of (i) Supply European Leader Coordination, (ii) Targeted Executive Coaching, (iii) Continued LEAD Insight, and (iv) Strategic Insight and Feedback. In performing the Services, you will (i) interact with the Company’s Chief Executive Officer and select business leaders via phone, internet and select one-on-one meetings on an as-needed basis, and (ii) participate in up to four (4) annual trips to the United States for meetings or site visits as deemed necessary by prior agreement between the parties. In addition, you may possibly participate in due diligence reviews and site visits in Europe. |
Term and Termination | The term of this Agreement will begin on February 1, 2014 and terminate on August 1, 2014. Thereafter, this Agreement will automatically renew for successive terms of six-months each (each, a “Renewal Term”), unless either party gives written notice of termination to the other party at least sixty (60) days prior to the expiration of the then-current term. Notwithstanding the foregoing, either party may terminate this Agreement during any Renewal Term by giving the other party at least sixty (60) days prior written notice. |
Compensation | As compensation for performing the Services, the Company will pay you $25,000 USD per calendar quarter (“Quarterly Fee”) and reimburse you for reasonably incurred travel and expenses. To receive payment, you will submit your travel expenses, supporting documentation, and an invoice for your Quarterly Fee to the Company on a quarterly basis. |
Bonuses | You will not be eligible for any bonus payments from the Company during the term of this Agreement and acknowledge that you will not receive any bonus payment from the Company for the period of September 1, 2013 through February 2, 2014. |
Reports and Access | During the term of this Agreement, you will be authorized to (i) use any email address provided to you by the Company, (ii) electronically access such files and servers of the Company which are necessary for you to furnish the Services, (iii) receive administrative support in the areas of expense reporting, document preparation, and travel planning, (iv) participate in select leadership meetings, and (v) receive Company reports and strategic plan information. |
Computer | During the term of this Agreement, you will have use of a computer which is provided by the Company. Upon termination of this Agreement, you will promptly return the computer to the Company. |
Non-Competition | During the term of this Agreement, you agree to not accept employment with, provide services to, or otherwise engage in any work or business activity for any company that is a competitor or direct or indirect customer of the Company insofar as such employment, services, work or business may involve or be closely related to the Services, or where any third party which competes with the Company might be benefited by the Services rendered or information gained by you under this Agreement. |
Independent Contractor | Both parties acknowledge the following: • You will have complete control of the means, manner, and the method by which you perform the Services and the times at which the Services will be performed, including determining your work and travel schedule. • Subject to the Non-Competition restrictions set forth above, you are free to perform services for any other entity or business and are not required to devote your full time and energy to the performance of the Services. • This Agreement will not be understood or construed to indicate any relationship between you and the Company other than that of an independent contractor. • As an independent contractor, you will not be eligible to participate in any Company sponsored pension, retirement, health, welfare, or benefit plans. • You will be responsible for payment of business and/or self-employment taxes, if any, and the Company will not be responsible for reimbursement of your business and/or self-employment tax liability with respect to the Services performed under this Agreement. |
Effects of Termination | Upon termination of this Agreement, (i) the Company will pay you for the Services you have performed as of the effective date of the termination, (ii) you will promptly return to the Company all documents, information, and papers, which you develop or come to possess during the performance of the Services that relate to or are part of the Company’s business matters, and (iii) you will promptly stop using Company email and accessing any Company files and servers. |
Applicable Law | This Agreement will be governed by the laws of the State of Wisconsin. |
Entire Agreement | This Agreement contains the entire understanding of the parties and may be modified only by the mutual written consent of the parties. |
Sincerely, | Agreed to this __17__ day of May, 2013 | |
/s/ Mark Goldstein | /s/ Guus Boel | |
Mark Goldstein | Guus Boel | |
Chief Operating Officer |
Re: | Consulting Agreement |
Term and Termination | The term of this Agreement will begin on April 1, 2013 and end on March 31, 2014. Notwithstanding the foregoing, either party may terminate this Agreement at any time upon thirty (30) days prior written notice. |
Consulting Services | Subject to the terms and conditions set forth in this Agreement, the Company will retain you as a consultant to assist the Company with those activities and projects requested by the Company from time to time (“Consulting Services”). All Consulting Services will be clearly defined in a written Scope of Work and will be subject to the mutual acceptance of both parties. In performing the Consulting Services, you will at all times be acting as an independent contractor. |
Compensation | As compensation for performing the Consulting Services, the Company will pay you $1,000 per day and reimburse you for reasonably incurred travel and expenses. To receive payment, you will invoice the Company on a quarterly basis and include appropriate documentation substantiating your expenses. It is understood by the parties that de minimis activities, such as short phone calls, will be included in the daily compensation and will not be billed separately. |
Non-Disclosure | Except as expressly authorized by the Company in writing, at no time during the term of this Agreement and at no time after its termination, will you publish, disclose or otherwise make known any information concerning the Company, its business, or its relationships with customers, which you became aware of in the course of performing the Consulting Services. |
Non-Competition | During the term of this Agreement and for the one-year period after its termination, you agree to not accept employment with, provide services to, or otherwise engage in any work or business activity for any company that is a competitor or direct or indirect customer of the Company insofar as such employment, services, work or business may involve or be closely related to the services provided by you under this Agreement, or where any third party which competes with the Company in the field of this Agreement might be benefited by the services rendered or information gained by you under this Agreement. |
Applicable Law | This Agreement will be governed by the laws of the State of Wisconsin. |
Sincerely yours, | Agreed to this ___7th___ day of March, 2013. | |
/s/ Mark Goldstein | /s/ William Axline | |
Mark Goldstein | William Axline | |
Chief Operating Officer |
NAME OF SUBSIDIARY: | STATE/COUNTRY OF INCORPORATION: | |
Hydratight Angola Lda | Angola | |
Actuant Australia Pty Ltd. | Australia | |
Hydratight (Asia Pacific) Pty Ltd. | Australia | |
Viking SeaTech (Australia) Pty Limited | Australia | |
Jeyco (1992) Pty Ltd | Australia | |
D.L. Ricci Australia Holding, LLC. | Australia | |
Hydratight Equipamentos e Servicos Ltda. | Brazil | |
Power Packer do Brazil LTDA | Brazil | |
Turotest Medidores LTDA | Brazil | |
Actuant Canada Corporation | Canada | |
Actuant Changchun Co. Ltd. | China | |
Actuant China Industries Co. Ltd. | China | |
Actuant China Ltd. | China | |
Actuant Shanghai Trading Co. Ltd. | China | |
Electrical Holdings, LLC | Delaware | |
Acme Electric Mexico Holdings I, Inc. | Delaware | |
Acme Electric Mexico Holdings II, Inc. | Delaware | |
Hydratight Operations, Inc. | Delaware | |
Versa Technologies, Inc. | Delaware | |
Actuant International Holdings, Inc. | Delaware | |
Gits Mfg. Co. | Delaware | |
Precision Sure-Lock, Inc. | Delaware | |
Maxima Holding Company Inc. | Delaware | |
Maxima Technologies & Systems, LLC. | Delaware | |
Maxima Holdings Europe, Inc | Delaware | |
Sanlo, Inc | Delaware | |
Cortland Company, Inc | Delaware | |
Actuant Holdings, LLC | Delaware | |
ASCP Weasler Holdings, Inc. | Delaware | |
Weasler Engineering, Inc | Delaware | |
Weasler Engineering (Europe), Inc | Delaware | |
Actuant UK Holdings, LLC | Delaware | |
GB Tools and Supplies LLC | Delaware | |
Hydratight FZ LLC | Dubai | |
CrossControl OY | Finland | |
Actuant France SAS | France | |
Hydratight SAS | France | |
Yvel SAS | France | |
Actuant Europe Holdings SASU | France | |
Actuant France Holdings SASU | France | |
Mastervolt SARL | France | |
CPS Convertible Power Systems GmbH | Germany | |
Enerpac GmbH | Germany | |
Hydratight Injectaseal Deutschland GmbH | Germany | |
Mastervolt GmbH | Germany | |
Actuant Global Sourcing, Ltd | Hong Kong |
NAME OF SUBSIDIARY: | STATE/COUNTRY OF INCORPORATION: | |
Actuant International Services, Ltd | Hong Kong | |
Mastervolt Asia Ltd | Hong Kong | |
Actuant Hungary Kft. | Hungary | |
ATU Hungary Holding Kft | Hungary | |
Weasler Engineering Kft | Hungary | |
Actuant Hungary Holdings Kft | Hungary | |
Actuant India Pvt Ltd | India | |
Enerpac Hydraulics (India) Pvt Limited | India | |
Engineered Solutions LP | Indiana | |
PT Viking SeaTech Indonesia | Indonesia | |
Enerpac SpA | Italy | |
Mastervolt International S.R.L | Italy | |
Applied Power Japan Ltd. | Japan | |
MT&S Europe, S.a.r.l | Luxembourg | |
CrossControl Sdn Bhd | Malaysia | |
Mastervolt Inc | Maryland | |
Acme Electric de Mexico S. De. R.L. de C.V. | Mexico | |
Acme Electric Manufacturing de Mexico S. De. R.L. de C.V. | Mexico | |
Hydatight de Mexico S De. R.L. de C.V. | Mexico | |
Servicios Acme de Mexico S. De. R.L. de C.V. | Mexico | |
Instrumentos Stewart Warner de Mexico S.A. de C.V. | Mexico | |
Actuant Europe CV | Netherlands | |
Actuant Finance CV | Netherlands | |
Applied Power Europa BV | Netherlands | |
ATU Benelux BV | Netherlands | |
Enerpac BV | Netherlands | |
Hydratight BV | Netherlands | |
Power Packer Europa BV | Netherlands | |
ATU Global Holdings BV | Netherlands | |
ATU Global Holdings II BV | Netherlands | |
ATU Global Holdings III BV | Netherlands | |
ATU Euro Finance BV | Netherlands | |
ATU Global Holdings CV | Netherlands | |
Weasler Engineering B.V | Netherlands | |
Mastervolt International Holding BV | Netherlands | |
Mastervolt International BV | Netherlands | |
Mastervolt BV | Netherlands | |
Enerpac Integrated Solutions B.V | Netherlands | |
Actuant Investments, Inc. | Nevada | |
Applied Power Investments II, Inc. | Nevada | |
BW Elliott Mfg. Co., LLC | New York | |
Actuant Electrical, Inc. | New York | |
BEP Marine Ltd. | New Zealand | |
Hydratight Norge AS | Norway | |
Selantic AS | Norway | |
Viking SeaTech Group AS | Norway | |
Viking SeaTech Holdings AS | Norway | |
Viking SeaTech Norge AS | Norway | |
Actuant LLC | Russia |
NAME OF SUBSIDIARY: | STATE/COUNTRY OF INCORPORATION: | |
Actuant Asia Pte. Ltd. | Singapore | |
Enerpac Asia Pte. Ltd. | Singapore | |
Hydratight Pte. Ltd. | Singapore | |
Enerpac Integrated Solutions Pte. Ltd | Singapore | |
Viking SeaTech Holdings (Singapore) Pte Limited | Singapore | |
Viking SeaTech People (Singapore) Pte Limited | Singapore | |
Viking SeaTech (Singapore) Pte Limited | Singapore | |
Enerpac Africa (Pty) Ltd | South Africa | |
Actuant Korea Ltd. | South Korea | |
Power Packer Espana SA | Spain | |
Maxima Spain Holdings, S.L. | Spain | |
Maxima Technologies, S.L. | Spain | |
Enerpac Spain, S.L. | Spain | |
Mastervolt Spain SL | Spain | |
Actuant Holdings AB | Sweden | |
Actuant Sweden Handelsbolag | Sweden | |
CrossCo Investment AB | Sweden | |
CrossControl AB | Sweden | |
Enerpac Scandinavia AB | Sweden | |
PSL Holdings, Inc. | Texas | |
Hydratight Ltd. | Trinidad | |
Ergun Hidrolik Sanayi VE Ticaret A.S. | Turkey | |
Actuant Energy Ltd. | UK | |
Actuant International Ltd. | UK | |
Actuant Ltd. | UK | |
Energise IT Ltd. | UK | |
Enerpac Ltd. | UK | |
Hedley Purvis Group Ltd. | UK | |
Hedley Purvis Holdings Ltd. | UK | |
Hedley Purvis International Ltd. | UK | |
Hydratight Ltd. | UK | |
Hedley Purvis Ventures Ltd. | UK | |
Hydratight Operations, Ltd. | UK | |
Actuant Finance Ltd | UK | |
D.L. Ricci Ltd. | UK | |
Cortland Fibron BX Ltd. | UK | |
Cortland UK Holdings Ltd. | UK | |
Actuant Acquisitions Ltd. | UK | |
Mastervolt UK Ltd. | UK | |
Venice Fundco Ltd. | UK | |
Venice Topco Ltd. | UK | |
Viking Moorings Group Ltd. | UK | |
Viking Moorings Holdings Ltd. | UK | |
Viking SeaTech Ltd. | UK | |
Viking SeaTech People (UK) Ltd. | UK | |
Enerpac Middle East FZE | United Arab Emirates |
1. | I have reviewed this annual report on Form 10-K of Actuant Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluations; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting |
/s/ Robert C. Arzbaecher | |
Robert C. Arzbaecher Chairman and Chief Executive Officer |
1. | I have reviewed this annual report on Form 10-K of Actuant Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting |
/s/ Andrew G. Lampereur | |
Andrew G. Lampereur Executive Vice President and Chief Financial Officer |
/s/ Robert C. Arzbaecher | |
Robert C. Arzbaecher |
/s/ Andrew G. Lampereur | |
Andrew G. Lampereur |
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