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CROWN PACIFIC PARTNERS L P
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8-K
Sep 3, 1:29 PM ET
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CROWN PACIFIC PARTNERS L P 8-K
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Contents
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1.1.1. Contracts. To the extent transferable, Seller’s right, title, and interest (i) as lessee under those real property leases listed on Schedule A-1 to this Agreement (the “Real Property Leases”), (ii) as lessee under those equipment leases and similar arrangements listed on Schedule A-2 to this Agreement (the “Personal Property Leases”), and (iii) as a party to those other contracts, licenses, agreements, and similar arrangements listed on Schedule A-3 to this Agreement and all purchase orders arising out of the operation of the Business and outstanding as of the Closing Date, including, without limitation, those purchase orders listed on Schedule A-4 to be delivered at Closing (the “Other Contracts”);
1.1.2. Real Property and Improvements. Seller’s right, title and interest in and to all improvements located on the Leased Real Property (the “Improvements”);
1.1.3. Personal Property. All tangible personal property and items of equipment used exclusively in the operation of the Business which is owned by Seller and located on the Real Property on the Closing Date, including, without limitation, those items listed on Schedule B to this Agreement and any other tangible personal property acquired by Seller after the Effective Date and prior to the Closing Date exclusively in connection with the Business (the “Personal Property”);
1.1.4. Intangible Property. All intangible personal property owned or held by Seller and used solely and exclusively in connection with the Business, but in each case only to the extent of Seller’s interest therein and only to the extent transferable, together with the Books and Records, specifically including the right to use of the trade name “Alliance” and “Alliance Lumber” within the State of Arizona (the “Intangible Property”);
1.1.5. Receivables. All accounts receivable arising out of the operation of the Business and outstanding as of the Closing Time (excluding accounts receivable from other divisions of Seller) except such accounts receivable which, as of the Closing Date, have been outstanding for more than ninety days (such accounts receivable shall be deemed to have arisen on the date an invoice for the receivable was first sent to the customer) and, subject to the provisions of Section 1.2, all causes of action relating thereto (the “Receivables”); and
1.1.6. Inventory. (i) All inventories of lumber, other wood products, and other products held for resale by the Business, or in transit to the Business, or otherwise prepaid, in the Ordinary Course of Business as of the Closing Time, wherever located, including, without limitation, those inventories or products in transit listed on Schedule C to be delivered at Closing; and (ii) all fuel, spare parts, and supplies owned by Seller and located at any of the facilities operated by the Business as of Closing Time (the “Inventory”).
2.4.1. Inventory Count. Promptly following the Closing, Representatives of Seller and Buyer shall jointly conduct a physical count of the Inventory as of the Closing Time.
2.4.2. Statement of Actual Net Book Value. Within twenty (20) Business Days after the Closing Date, Seller shall deliver the Statement of Actual Net Book Value to Buyer. Buyer shall, and shall direct its employees to, cooperate with Seller, at no expense to Seller, and provide Seller with access to all Books and Records necessary, for the preparation of the Statement of Actual Net Book Value.
2.4.3. Objections. Buyer shall have ten (10) Business Days after the delivery of the Statement of Actual Net Book Value within which to give Seller notice of any objection to any amount set forth therein. Any such notice shall identify the specific amounts to which Buyer objects and shall set forth with reasonable specificity the basis for Buyer’s objections. All amounts set forth in the Statement of Actual Net Book Value to which Buyer does not object as provided in this Section 2.4.3 shall irrevocably be deemed approved by Buyer.
2.4.4. Disputes. If Buyer gives notice in accordance with Section 2.4.3 objecting to any amounts set forth in the Statement of Actual Net Book Value, then the parties shall negotiate in good faith in an effort to resolve such objections. If the parties are unable to resolve any such objections within ten (10) Business Days after Buyer’s notice of objection is given, then the issues in dispute shall be submitted to the Accountants for resolution. In such event, (i) each party shall furnish to the Accountants such workpapers and other documents and information relating to the disputed issues as are in the possession or control of such party and shall be afforded an opportunity to present to the Accountants the basis for its view with respect to the disputed issues and to discuss the determination of the disputed issues with the Accountants, (ii) the determination by the Accountants shall be final and binding on the parties, and (iii) Seller and Buyer shall each pay, and shall each be liable only for, one-half of the fees and expenses of the Accountants. Seller and Buyer shall direct the Accountants to use all reasonable efforts to complete their determination of the disputed issues within thirty (30) calendar days after they are submitted to the Accountants.
2.4.5. Payments. On the third Business Day following (i) the expiration of the ten (10) Business Day period referred to in Section 2.4.3 if Buyer fails to give a notice of objection as provided therein, or (ii) the resolution of any objections set forth in Buyer’s notice pursuant to Section 2.4.3, whether by agreement of the parties or determination by the Accountants pursuant to Section 2.4.4, the Deposit shall be released to Buyer or Seller, as the case may be, in accordance with this Section 2.4.5.
3.1.1. Use commercially reasonable efforts to conduct the Business and operate and maintain the Purchased Assets in the Ordinary Course of Business;
3.1.2. Not sell, lease, or otherwise transfer or dispose of any material Purchased Assets, or any interest therein, other than transfers and dispositions, including the sale of lumber, other wood products, and other products, made in the Ordinary Course of Business;
3.1.3. Not permit or allow any material Purchased Assets to become subject to any additional Lien (other than Permitted Encumbrances);
3.1.4. Use its commercially reasonable efforts to maintain the relations and goodwill with suppliers, customers, and others having business relationships with Seller in connection with the Business; and
3.1.5. Pay all post-Petition Date amounts due under the Personal Property Leases and the Real Property Leases through the Closing Date.
4.1.1. All representations and warranties of Buyer set forth in this Agreement (considered collectively) and each such representation and warranty (considered individually) shall have been true and correct in all material respects as of the Effective Date and shall be true and correct in all material respects as of the Closing Date, as if made on the Closing Date.
4.1.2. All of the covenants and obligations that Buyer is obligated to perform or comply with pursuant to this Agreement prior to or at the Closing (considered collectively) and each such covenant and obligation (considered individually) shall have been performed and complied with in all material respects.
4.1.3. Buyer shall have made the deliveries of documents and funds required to be made pursuant to Section 5.3.
4.1.4. As of the Closing Date, there shall not be in effect any Legal Requirement or any Order that prohibits the transfer of any material portion of the Purchased Assets by Seller to Buyer.
4.1.5. Since the Effective Date, there shall not have been commenced or Threatened against Seller or any Affiliate of Seller any Proceeding (i) seeking material Damages or other material relief in connection with any aspect of this transaction, or (ii) that could reasonably be expected to have the effect of preventing or making illegal this transaction.
4.1.6. Neither the consummation of this transaction nor the performance of Seller’s obligations hereunder shall, directly or indirectly (with or without notice, lapse of time, or both), contravene, conflict with, result in a violation of, or cause Seller or any Affiliate of Seller to suffer any material adverse consequence under any applicable Legal Requirement or Order that has been published, introduced, or otherwise proposed by or before any Governmental Authority since the Effective Date.
4.1.7. The Bankruptcy Court shall have entered the Approval Order and such order shall not have been stayed as of the Closing Date.
4.2.1. All representations and warranties of Seller set forth in this Agreement (considered collectively) and each such representation and warranty (considered individually) shall have been true and correct in all material respects as of the Effective Date and shall be true and correct in all material respects as of the Closing Date, as if made on the Closing Date.
4.2.2. All of the covenants and obligations that Seller is obligated to perform or comply with pursuant to this Agreement prior to or at the Closing (considered collectively) and each such covenant and obligation (considered individually) shall have been performed and complied with in all material respects.
4.2.3. Seller shall have made the deliveries of documents required to be made pursuant to Section 5.2.
4.2.4. As of the Closing Date, there shall not be in effect any Legal Requirement or any Order that prohibits the transfer of any material portion of the Purchased Assets by Seller to Buyer.
4.2.5. Since the Effective Date, there shall not have been commenced or Threatened against Buyer or any Affiliate of Buyer any Proceeding (i) seeking material Damages or material other relief in connection with any aspect of this transaction, or (ii) that could reasonably be expected to have the effect of preventing or making illegal this transaction.
4.2.6. Neither the consummation of this transaction nor the performance of Buyer’s obligations hereunder shall, directly or indirectly (with or without notice, lapse of time, or both), contravene, conflict with, result in a violation of, or cause Buyer or any Affiliate of Buyer to suffer any material adverse consequence under any applicable Legal Requirement or Order that has been published, introduced, or otherwise proposed by or before any Governmental Authority since the Effective Date.
4.2.7. The Bankruptcy Court shall have entered the Approval Order and such order shall not have been stayed as of the Closing Date.
4.2.8. Since the Effective Date, the ability of Wells Fargo Bank, National Association to provide financing to Buyer pursuant to that certain commitment letter dated June 8, 2004 shall not have been adversely affected in any material way as the result of any fire, explosion, accident, riot, terrorist attack, civil or labor disturbance, strike, boycott, lockout, flood, drought, storm, earthquake, embargo or other casualty or act of God or the public enemy.
5.2.1. A Bill of Sale, substantially in the form of Exhibit B to this Agreement (the “Bill of Sale”), conveying the Personal Property and the Inventory to Buyer, duly executed by Seller.
5.2.2. An Assignment and Assumption Agreement, substantially in the form of Exhibit C to this Agreement (the “Assignment and Assumption Agreement”), duly executed by Seller and providing for (a) the assignment to Buyer of the Contracts, the Intangible Property and the Receivables, and (b) Buyer’s assumption of the Assumed Liabilities and indemnification of Seller in respect thereof (including, without
limitation, indemnification in respect of any legal fees or other costs incurred by Seller in exercising its right to indemnity).
5.2.3. Written certification evidencing Seller’s satisfaction of all of Seller’s covenants and obligations set forth in Sections 4.1.1 and 4.1.2.
5.3.1. The Purchase Price, less the Deposit (which shall be released to Seller, together with all interest thereon, by the Deposit Escrow Agent), by wire transfer of immediately available funds.
5.3.2. The Assignment and Assumption Agreement, duly executed by Buyer.
5.3.3. The Bill of Sale, duly executed by Buyer.
5.3.4. Written certification evidencing Buyer’s satisfaction of all of Buyer’s covenants and obligations set forth in Sections 4.2.1 and 4.2.2.
5.3.5. Appropriate evidence of all necessary action by Buyer in connection with the transactions contemplated hereby, including, without limitation: (i) certified copies of resolutions duly adopted by Buyer’s Board of Directors approving the transactions contemplated by this Agreement and authorizing the execution, delivery, and performance by Buyer of this Agreement; and (ii) a certificate as to the incumbency of officers of Buyer executing this Agreement and any instrument or other document delivered in connection with the transactions contemplated by this Agreement.
5.3.6. In the event that Buyer makes any assignment of its rights under this Agreement to an Affiliate of Buyer as provided in Section 10.5 below, Buyer shall have executed and delivered to Seller, concurrently with or prior to the Closing Date, a guaranty, substantially in the form and substance attached hereto as Exhibit E (the “Guaranty”), of all of Buyer’s obligations under this Agreement and under any documents executed by such Affiliate of Buyer in favor of Seller pursuant hereto.
6.1.1. Organization and Good Standing. Seller is a limited partnership duly formed, validly existing, and in good standing under the laws of the State of Delaware.
6.1.2. Authority; No Conflict.
(a) Upon obtaining the Approval Order, this Agreement shall constitute the legal, valid, and binding obligation of Seller, enforceable against Seller in accordance with its terms. Upon their execution and delivery by Seller at the Closing, each of the Seller Closing Documents will constitute the legal, valid, and binding obligations of Seller, enforceable against Seller in accordance with their respective terms. Subject to obtaining the Approval Order and applicable provisions of bankruptcy law, Seller has full partnership power, authority, and capacity to execute and deliver this Agreement and each of the Seller Closing Documents and to perform its obligations hereunder and thereunder.
(b) Upon obtaining the Approval Order, neither the execution and delivery of this Agreement, nor the performance of any of Seller’s obligations hereunder, nor the consummation of the transactions herein contemplated will, directly or indirectly (with or without notice, lapse of time, or both), (i) contravene or result in a violation of any provision of Seller’s Organizational Documents or any resolution adopted by the Board of Control, by the general or limited partners of Crown Management, or by the limited partners of Seller; (ii) contravene or result in a violation of any Legal Requirement or any Order to which Seller or any of the Purchased Assets is subject; or (iii) contravene or result in a violation or breach of any provision of, or give any Person the right to declare a default or exercise any remedy under, any agreement, instrument, or writing of any nature to which Seller is a party or by which Seller or any of its assets or properties is bound.
6.1.3. Certain Proceedings. Except for the Case, no Proceeding is pending or, to Seller’s Knowledge, has been Threatened, against Seller that challenges, or could reasonably be expected to have the effect of preventing, making illegal, or otherwise materially interfering with, the transactions herein contemplated.
6.2.1. Organization and Good Standing. Buyer is a corporation, duly formed, validly existing, and in good standing under the laws of the State of Arizona.
6.2.2. Authority; No Conflict.
(a) This Agreement constitutes the legal, valid, and binding obligation of Buyer, enforceable against Buyer in accordance with its terms. Upon their execution and delivery by Buyer at the Closing, each of the Buyer Closing Documents will constitute the legal, valid, and binding obligations of Buyer, enforceable against Buyer in accordance with their respective terms. Buyer has full corporate power, authority, and capacity to execute and deliver this Agreement and each of the Buyer Closing Documents and to perform its obligations hereunder and thereunder.
(b) Neither the execution and delivery of this Agreement, nor the performance of any of Buyer’s obligations hereunder, nor the consummation of the transactions herein contemplated will, directly or indirectly (with or without notice, lapse of time, or both), (i) contravene or result in a violation of any provision of Buyer’s Organizational Documents or any resolution adopted by the Board of Directors or the shareholders of Buyer; or (ii) contravene or result in a violation of any Legal Requirement or any Order to which Buyer is subject; or (iii)
contravene or result in a violation or breach of any provision of, or give any Person the right to declare a default or exercise any remedy under, any agreement, instrument, or writing of any nature to which Buyer is a party or by which Buyer or any of its assets or properties is bound.
6.2.3. Certain Proceedings. No Proceeding is pending or, to Buyer’s Knowledge, has been Threatened against Buyer that challenges, or could reasonably be expected to have the effect of preventing, making illegal, or otherwise materially interfering with, the transactions herein contemplated.
6.2.4. Buyer has sufficient funds available to consummate the transactions contemplated hereby.
6.3.1. Buyer has conducted all investigations, inspections, studies, tests, and analyses it desired to conduct with respect to the Business and the Purchased Assets and acknowledges that it has been provided sufficient access to the Purchased Assets, including the Books and Records, and to key employees for such purpose. In entering into this Agreement, Buyer is relying solely on its own investigation and is assuming the risk that adverse physical, economic, or other conditions or circumstances may not have been revealed by its investigation.
6.3.2. EXCEPT AS EXPRESSLY SET FORTH IN SECTION 6.1, NEITHER SELLER NOR ANY OF THEIR REPRESENTATIVES MAKES OR HAS MADE ANY REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO ANY MATTER RELATING TO THE BUSINESS OR THE PURCHASED ASSETS, INCLUDING INCOME TO BE DERIVED OR EXPENSES TO BE INCURRED IN CONNECTION THEREWITH; THE TERMS OF THE REAL PROPERTY LEASES; THE PHYSICAL CONDITION OF ANY OF THE PURCHASED ASSETS (OR ANY PORTION THEREOF) AND ANY LEASED REAL PROPERTY OR IMPROVEMENTS, OR ANY PROPERTY WHICH IS THE SUBJECT OF ANY OF THE PERSONAL PROPERTY LEASES OR ANY PART OF THE FOREGOING; THE ENVIRONMENTAL CONDITION OF ANY LEASED REAL PROPERTY OR IMPROVEMENTS; THE ZONING OF ANY LEASED REAL PROPERTY OR IMPROVEMENT; THE TRANSFERABILITY OF ANY OF THE PURCHASED ASSETS; THE VALUE OF THE PURCHASED ASSETS (OR ANY PORTION THEREOF); THE TERMS, AMOUNT, VALIDITY, OR ENFORCEABILITY OF ANY OF THE ASSUMED LIABILITIES; THE TITLE TO ANY OF THE PURCHASED ASSETS (OR ANY PORTION THEREOF); THE MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF ANY OF THE PURCHASED ASSETS; OR ANY OTHER MATTER OR THING RELATED TO THE PURCHASED ASSETS OR THE BUSINESS. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, SELLER HEREBY EXPRESSLY DISCLAIMS ANY WARRANTY, EXPRESS OR IMPLIED, OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE AS TO ANY OF THE PURCHASED ASSETS (OR ANY PORTION THEREOF).
6.3.3. BUYER WILL ACCEPT THE PURCHASED ASSETS AT THE CLOSING “AS IS,” “WHERE IS,” AND “WITH ALL FAULTS”.
7.1.1. Offer of Employment. Buyer agrees to offer (or to cause one of its Affiliates to offer), effective as of the Closing Date, employment to substantially all employees who are in the active employment of the Business on the Closing Date, on substantially the same terms and conditions, in the aggregate, and at the same rate of pay, as such employee was employed on the day prior to the Closing Date (the “Continuing
Employees”); provided, however, that Buyer shall have the right to conduct customary employee background checks prior to offering employment to any such employee. Buyer will grant to each Continuing Employee service credit for previous service recognized by Seller for purposes of vacation and other benefits (whether or not accrued on the financial statements of Seller).
7.1.2. WARN Act. Buyer shall be responsible for and shall pay any and all liabilities or obligations under the WARN Act, if any, arising out of or resulting from layoffs of employees or any termination of their employment in the Business which occurs on or after the Closing Date. Buyer agrees to indemnify, and hold Seller and its successors harmless from or against, any and all Damages which Seller may incur in connection with any suit or claim of violation brought against Seller under the WARN Act or any similar state or foreign law, which relates to transactions effected on or after the Closing Date, or any other action taken by Buyer after the Closing Date.
7.1.3. Employee Benefits. Effective as of the Closing Date, Buyer shall offer group medical insurance coverage for the Continuing Employees and their dependents and beneficiaries, without preexisting condition exclusions, waiting times to commence coverage, or other lapses in coverage. In addition, commencing on the Closing Date, Buyer shall provide the Continuing Employees and their dependents and beneficiaries coverage under any other pension, retirement, welfare and fringe benefit plans, programs, policies or arrangements established by Buyer for such persons, who for all purposes of this sentence will be credited, to the extent permissible under applicable law, with all service recognized by Seller or its Affiliates.
7.1.4. Forms W-2. Seller and Buyer agree that (i) Seller will issue a Form W-2 to each individual who is employed in the Business as of, or prior to, the Closing Date in respect of all payments made by Seller to each such individual on or prior to the Closing Date, and (ii) Buyer will issue a Form W-2 to each Continuing Employee in respect of all payments made by Buyer or any Affiliate of Buyer to each such individual after the Closing Date.
7.1.5. Payment of Pre-Closing Wages and Benefits. To the extent that any wages and benefits owed to Continuing Employees as of the Closing Date remain unpaid on the Closing Date, Seller shall retain all obligations with respect thereto. Seller shall remain liable for, and Buyer shall not assume any liability of Seller under, the Key Employee Retention Plan between Seller and certain persons, including certain Continuing Employees.
7.2.1. Buyer agrees to retain the Books and Records for a period of seven (7) years after the Closing Date. Buyer shall permit Seller (or its successors) and its Representatives to inspect and copy, at Seller’s (or such successor’s) sole expense, any of the Books and Records at any time during normal business hours, upon reasonable advance notice.
7.2.2. After the seven-year period referred to in Section 7.2.1, Buyer shall provide not less than thirty (30) nor more than sixty (60) days notice to Seller (or its successors, if previously identified by notice to Buyer) prior to any proposed destruction or disposition of any of the Books and Records. Any such notice shall identify with reasonable specificity the Books and Records to be destroyed or disposed of and the date on which such destruction or disposition will occur. If the recipient of any such notice wishes to obtain any of the Books or Records to be destroyed or disposed of, it may do so by giving notice to Buyer at any time prior to the scheduled date for destruction or disposition. All out-of-pocket costs of delivering any such Books and Records to a requesting party shall be paid by such party.
8.1.1. If all conditions to Closing required to obligate a party to close the transactions set forth herein have been satisfied and such party has not tendered performance of its Closing obligations or deliveries hereunder on or before the Closing Date, then the party who is not then in default hereunder may terminate this Agreement by delivering to the other written notice of termination. Any waiver of a condition shall be effective only if such waiver is stated in writing and signed by the waiving party; provided, however, that the consent of a party to the Closing shall constitute a waiver by such party of any conditions to Closing not satisfied as of the Closing Date; or
8.1.2. By mutual written agreement of Seller and Buyer; or
(i) the book value of the Personal Property listed on Schedule B, plus
(ii) the cost of any items of Personal Property acquired by Seller in the Ordinary Course of Business after the Effective Date and prior to the Closing Date exclusively in connection with the operation of the Business, plus
(iii) the value of the Inventory as of the Closing Time (valued at average cost, determined in a manner consistent with Seller’s internal operating statements for the period ending as of the last day of the last calendar month ended prior to the Effective Date, without further adjustment to market value), plus
9.2.1. The headings or titles of the sections of this Agreement are intended for ease of reference only and shall have no effect whatsoever on the construction or interpretation of any provision of this Agreement. References herein to sections are to sections of this Agreement unless otherwise specified.
9.2.2. Meanings of defined terms used in this Agreement are equally applicable to singular and plural forms of the defined terms. The masculine gender shall also include the feminine and neutral genders and vice versa.
9.2.3. As used herein, (i) the term “party” refers to a party to this Agreement, unless otherwise specified, (ii) the terms “hereof,” “herein,” “hereunder,” and similar terms refer to this Agreement as a whole and not to any particular provision of this Agreement, (iii) the term “including” is not limiting and means “including, without limitation,” (iv) the term “documents” includes all instruments, documents, agreements, certificates, indentures, notices, and other writings, however evidenced, and (v) the term “property” includes any kind of property or asset, real, personal, or mixed, tangible or intangible.
9.2.4. In the event any period of time specified in this Agreement ends on a day other than a Business Day, such period shall be extended to the next following Business Day. In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including,” the words “to” and “until” each mean “to but excluding,” and the word “through” means “to and including.”
9.2.5. This Agreement is the product of arm’s length negotiations among, and has been reviewed by counsel to, the parties and is the product of all of the parties. Accordingly, this Agreement shall not be construed for or against any party by reason of the authorship or alleged authorship of any provision hereof.
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