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Exhibit 2.2
AMENDMENT NO. 1
TO
STOCK PURCHASE AGREEMENT
THIS AMENDMENT NO. 1 TO STOCK PURCHASE AGREEMENT (the "First
Amendment") is made as of the 19th day of October, 1999, among Day International
Group, Inc., a Delaware corporation ("Buyer") and the Stockholders Identified on
the Signature Pages to the Original Agreement (as hereinafter defined)
(collectively, the "Stockholders"). Terms used herein that are not defined
herein shall have the meanings ascribed thereto in the Original Agreement.
WHEREAS, the parties hereto entered into a Stock Purchase Agreement,
dated as of August 13, 1999 (the "Original Agreement");
WHEREAS, Buyer has asserted certain breaches of representations,
warranties and covenants under the Agreement resulting from (i) the alleged
failure of certain members of the Subject Company Group to reflect a certain
real property lease agreement dated November 29, 1993 (the "Lease") between
HALOS Grundstucks-Vermietungsgesellschaft GmbH & Co. Objekt Luma KG and Xxxx
Products Co. GmbH, as amended, on the Financial Statements as either debt or a
capital lease, and (ii) the alleged failure of the Stockholders and certain
members of the Subject Company Group to characterize the Lease as debt (and not
an operating lease) on the Disclosure Schedule (collectively, the "Alleged
Breaches");
WHEREAS, the Stockholders dispute the Alleged Breaches;
WHEREAS, the parties have agreed that, in consideration for a reduction
in the Consideration, Buyer shall waive any rights to indemnification under the
Original Agreement for any of the Alleged Breaches; and
WHEREAS, the parties acknowledge that JV TEX Realty Corp., a Texas
corporation and a Subject Company, is indebted to J V N J Realty Corp., a New
Jersey corporation that is not a Subject Company ("JVNJ"), in the aggregate
amount of $556,000 (the "JVTEX Debt"); and
WHEREAS, the parties have agreed that, in consideration for a reduction
in the Consideration, Buyer shall purchase the JVTEX Debt;
WHEREAS, the Stockholders wish to provide for payments of $150,500 and
$217,700 to be made to the individuals and in the amounts set forth on Annex 1
hereto,
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respectively, after the Closing, both such payments to be made by Xxxx Products
Co. (the "Bonus Payments");
WHEREAS, Buyer has agreed to cause such Bonus Payments to be made by
Xxxx Products Co. subsequent to the Closing and the Stockholders have agreed to
fund a portion of such Bonus Payments by leaving $293,200 in cash in Xxxx at
Closing in addition to any amounts set forth on Schedule 1 to the Original
Agreement, and Buyer has agreed to fund a portion of such Bonus Payments by
contributing $75,000;
WHEREAS, the parties hereto desire to amend the Original Agreement, as
described below, by entering into this First Amendment.
NOW, THEREFORE, in consideration of the promises and of the mutual
agreements, representations, warranties, provisions and covenants herein
contained, the parties hereto hereby agree as follows:
1. The Background section is hereby deleted in its entirety and there
is inserted in lieu thereof the following:
This Agreement sets forth the terms and conditions under which Buyer or
its permitted assigns will acquire all of the issued and outstanding
stock of, Varnco Holdings Inc., a New Jersey corporation ("VARNCO"),
Xxxx Holdings PLC, a company incorporated under the laws of England
("XXXX HOLDINGS"), Xxxx Aegis Co. GmbH Hautschutzsysteme, a company
incorporated under the laws of Germany ("XXXX AEGIS"), Xxxx Products
Co., Inc., a Texas corporation ("XXXX PRODUCTS CO."), JV TEX Realty
Corp., a Texas corporation ("JVTEX"), Graph Tech, Inc., an Ohio
corporation ("GRAPH TECH," and collectively with Varnco, Xxxx Holdings,
Xxxx Aegis, Xxxx Products Co. and JVTEX, the "SUBJECT COMPANIES") from
the Stockholders, and the Subject Companies will become wholly owned
Subsidiaries of Buyer.
2. The first sentence of Section 2.1 is hereby deleted and there is
inserted in lieu thereof the following:
Subject to the terms and conditions contained in this Agreement, on the
Closing Date, the Stockholders shall sell, assign, transfer and deliver
to Buyer or its designated Subsidiaries, and Buyer or its designated
Subsidiaries shall purchase from the Stockholders, all of the Shares of
the Subject Companies in exchange for an aggregate purchase price of
U.S. $59,300,000, PLUS an amount equal to the cash
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held by the Subject Companies and their Subsidiaries set forth on
SCHEDULE 1, PLUS the Earn-Out Payments, MINUS an amount equal to sum of
the German Debt and the JVTEX Debt, (such amounts, in the aggregate,
the "CONSIDERATION").
3. Section 6.8(a) is hereby deleted and there is inserted in lieu
thereof the following:
(a) On or prior to the Closing Date, the Stockholders or the Subject
Companies shall pay all amounts owing by the Subject Companies with
respect to the indebtedness for borrowed money other than (i) any
indebtedness for borrowed money owed to one Subject Company from any
other Subject Company, (ii) the German Debt, or (iii) the JVTEX Debt.
4. Section 7.12 is hereby amended by adding the following sentence at
the end thereof:
On the Closing Date, Xxxx Products Co. shall have at least $293,200 of
cash on hand, which shall be in addition to any amounts set forth on
Schedule 1 hereto. In addition to the $293,200 of cash on hand in Xxxx
Products Co., Buyer shall contribute $75,000 towards the Bonus Payments
payable on April 1, 2000 (as set forth on Annex 1 to the First
Amendment to this Agreement). Xxxx Products Co. shall distribute the
Bonus Payments as set forth on Annex 1 to the First Amendment to this
Agreement, provided that the individual allocations (but not the
aggegate amount of the Bonus Payments) may be reallocated among the
empoyees set forth on Annex 1 to the First Amendment to this Agreement
in a reasonable manner by Buyer following consultation with the
Sellers' Represenatives.
5. The following is hereby added at the end of Section 8:
8.10 JVTEX DEBT. Buyer shall have purchased the JVTEX Debt by
making a cash payment in the amount of $556,000 to JVNJ.
6. Section 10.1 is hereby amended by deleting Section 10.1(a) in its
entirety and adding in lieu thereof the following:
(a) Subject to the other provisions of this Section 10, from and after
the Closing Date, each Stockholder other than Xxxxx Xxxxxxxx,
individually (but not in his capacity as trustee) and Xxxxxxx Xxxxxxxx,
individually (but not in his capacity as trustee) shall indemnify and
hold harmless Buyer, its Affiliates, each member
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of the Subject Company Group and their respective officers, directors,
employees, agents and representatives (each a "BUYER INDEMNIFIED
PARTY") for one hundred percent (100%) of the first Three Million
Dollars (U.S. $3,000,000) of, and ninety percent (90%) of any
additional, liabilities, claims, demands, judgments, losses, costs,
damages or expenses whatsoever (including reasonable attorneys',
consultants' and other reasonable professional fees and disbursements
of every kind, nature and description incurred in connection therewith,
but excluding any consequential or punitive damages other than
consequential or punitive damages in connection with the litigation
matters set forth on SCHEDULE 4.11), net of any insurance proceeds
available for the payment thereof (collectively, "DAMAGES"), directly
or proximately caused by, resulting from in connection with or pursuant
to (i) any breach of any of the respective representations and
warranties of any Stockholder contained in this Agreement or of Iona
College Charitable Gift Fund contained in the Letter Agreement dated of
even date herewith between Iona College Charitable Gift Fund and Buyer,
(ii) any breach of any of the covenants or agreements of any
Stockholder contained in this Agreement, (iii) the business, operations
or properties of any Unrelated Company, (iv) any Unrelated Liability
and (v) environmental conditions existing on, under, above, about or
emanating from the Hayward Facility, including the soil, air and
groundwater, (vi) the ERISA indemnity under Section 10.8 or any
sanctions or penalties imposed by the IRS in connection with an IRS
Audit (except to the extent any such sanctions or penalties relate to
any indemnification provided under Section 10.8) and (vii) the Xxxxx
Xxxxxx Deferred Compensation Trust, dated May 4, 1998, between Xxxx
Products Co., Inc. and Xxxxxxxx Xxxxxx, except for any Damages arising
from the insolvency of Xxxx Products Co., Inc. Notwithstanding the
foregoing, any indemnification for any claim arising from any
inaccuracy of any representation or warranty set forth in Section
4.6(b) or related to or arising from clauses (iii), (iv), (v), (vi) or
(vii) of this Section 10.1(a) shall be for one hundred percent (100%)
regardless of whether any such claim exceeds Three Million Dollars
(U.S. $3,000,000).
7. Article 10 is hereby amended by adding thereto a new Section 10.8 as
follows:
10.8 ERISA INDEMNIFICATION. From and after the Closing Date,
each Stockholder other than Xxxxx Xxxxxxxx, individually (but
not in his capacity as trustee) and Xxxxxxx Xxxxxxxx,
individually (but not in his capacity as trustee) shall
indemnify and hold harmless each Buyer Indemnified Party from
and against any Damages, including, but not
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limited to, corrective contributions and earnings thereon, any
excise taxes under the Code, IRS penalties and attorney and
consulting fees that may be incurred with respect to the
correction of any form or operational defect set forth on
Schedule 4.15(b) and (c) of the Disclosure Schedule relating
to the Xxxx/Graph-Tech Savings and Investment Plan (the "XXXX
401(k) PLAN") if such Damages are caused by such a form or
operational defect that occurred (i) prior to the Closing Date
and (ii) in connection with a Subject Company Group member's
sponsorship and maintenance of the Xxxx 401(k) Plan; provided,
however, that Buyer shall commence with the IRS a voluntary
disclosure and correction of the form or operational defects
set forth on Schedule 4.15(b) and (c) of the Disclosure
Schedules, in accordance with Revenue Procedure 98-22 (or any
successor revenue procedure thereto) or otherwise commence
correction of such defects within the period ending on the
first anniversary of the Closing, and Buyer shall correct such
defects on the basis which Buyer is advised by an independent,
nationally recognized pension consulting firm selected by
Buyer is likely to be the most cost efficient correction
methodology available under Revenue Procedure 98-22 or
otherwise as such consultant advises Buyer is likely to
minimize the indemnification and hold harmless protection
provided hereunder by the Stockholders, and the Buyer shall
reasonably keep the Sellers' Representatives appraised of such
correction procedure.
8. Each Buyer Indemnified Party hereby waives any and all rights and
claims under Section 10 of the Original Agreement, or otherwise, arising out of
or relating to the Alleged Breaches.
9. This First Amendment is executed, and shall be considered, as an
amendment to the Original Agreement and shall form a part thereof, and the
provisions of the Original Agreement, as amended by this First Amendment, are
hereby ratified and confirmed in all respects.
10. This First Amendment may be executed in any number of counterparts,
each of which shall be deemed an original, and all of which taken together shall
constitute but one and the same instrument. This First Amendment shall become
binding only when each party hereto has executed and delivered to the other
parties one or more counterparts.
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[SIGNATURE PAGE TO AMENDMENT NO. 1
TO STOCK PURCHASE AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment or have caused this First Amendment to be duly executed by their
respective authorized officers as of the day and year first above written.
Buyer: DAY INTERNATIONAL GROUP, INC.
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: President & CEO
Stockholders: /s/ Xxxxxxx Xxx Xxxxx
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XXXXXXX XXX XXXXX
/s/ Xxxxxx Xxx Xxxxx
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XXXXXX XXX XXXXX
/s/ Xxxx Xxxxxxxxxxx
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XXXX XXXXXXXXXXX
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[SIGNATURE PAGE TO AMENDMENT NO. 1
TO STOCK PURCHASE AGREEMENT]
/s/ Xxxxxx Xxx Xxxxx-Xxxxxxx
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XXXXXX XXX XXXXX-XXXXXXX
/s/ Xxxxxxxxxxx Xxx Xxxxx
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XXXXXXXXXXX XXX XXXXX
/s/ Xxxxxxx Xxxxxxx
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XXXXXXX XXXXXXX
/s/ Xxxx Xxx Xxxxx
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XXXX XXX XXXXX
/s/ Xxxx Xxx Xxxxx
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XXXX XXX XXXXX
/s/ Xxxxxxxx Xxx Zwehl
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XXXXXXXX XXX ZWEHL
/s/ Xxxx xxx Xxxxx
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XXXX XXX XXXXX
/s/ Xxxxxxx Xxx Xxxxx
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XXXXXXX XXX XXXXX
/s/ Xxxxxx Xxx Xxxxx
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XXXXXX XXX XXXXX
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/s/ Xxxx Xxxxxxx Von Zwehl
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XXXX XXXXXXX VON ZWEHL
[SIGNATURE PAGE TO AMENDMENT NO. 1
TO STOCK PURCHASE AGREEMENT]
/s/ Xxxxx Xxxxxxxx
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XXXXX XXXXXXXX, INDIVIDUALLY
AND AS TRUSTEE
/s/ Xxxxxxx Xxxxxxxx
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XXXXXXX XXXXXXXX, INDIVIDUALLY
AND AS TRUSTEE
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ANNEX 1
BONUS PAYMENTS TO BE PAID ON OR BEFORE OCTOBER 28, 1999
Omitted. The Company agrees to furnish supplementally a copy of this Annex to
the Securities and Exchange Commission upon request.