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FIRST AMENDMENT TO THE
ACQUISITION AGREEMENT
BY AND BETWEEN
ESCO ELECTRONICS CORPORATION AND SCHAWK, INC.
DATED DECEMBER 18, 1996
This First Amendment to the Acquisition Agreement by and between ESCO
Electronics Corporation and Schawk, Inc. dated December 18, 1996 (this
"Amendment") is dated as of February 6, 1997.
Whereas, ESCO Electronics Corporation, a Missouri corporation ("Buyer") and
Schawk, Inc., a Delaware corporation ("Seller") are parties to an acquisition
agreement (the Acquisition Agreement") dated December 18, 1996, to which they
desire to make certain amendments, as further described herein.
Now therefore, in consideration of the foregoing recitals and the premises and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree for themselves, their
successors and assigns, as follows:
1. The following clause shall be added at the end of subparagraph 2.9 (e):
"and shall include interest at the prime rate of interest as announced from
time to time by Xxxxxx Guaranty Trust Co. of New York from the Closing Date
through the date of payment."
2. Clause (b)(i) in Section 3.13 of the Acquisition Agreement is deleted and
replaced by the following:
"(i)(A) registered patents and trademarks included in the Intellectual
Property were validly issued, (B) unregistered trademarks included in the
Intellectual Property are valid, to the full extent, in civil law
counties, of protection for unregistered trademarks under applicable Law,
and in common law counties, to the full extent under common law and (C)
except as set forth on Schedule 3.13(b), no Seller Group Person has
received notice of the invalidity or unenforccability of any Intellectual
Property;"
3. Section 5.4 of the Acquisition Agreement is hereby deleted and replaced
by the following:
5.4 Full Access. Seller covenants that, until the Closing,
representatives of Buyer shall have full access at all reasonable
times to all premises, properties, books, records, contracts, tax
records and documents of each Seller Group Person relating to the
Business, and Seller will furnish to Buyer any information in
respect to the Business as Buyer may from time to time request. Such
examination and investigation by Buyer, and any discovery of facts
resulting therefrom, shall not affect the warranties and
representations of Seller contained in this Agreement. Buyer shall
inform Seller of any matter involving Indemnified Loss involving
$50,000 or more as to which Buyer believes, as of the Closing Date,
that it is entitled to and intends to assert a claim pursuant to
Article IX hereof that arises from a breach of the representations
and warranties pursuant to Article III hereof.
5. The following clause (h) shall be added to Section 9.1 of the
Acquisition Agreement. "and/or (h) any fines, orders, sanctions,
penalties, or other claims by any Government, and any Liability to any to
any Employee, arising from any actual or alleged violation of any Law
respecting employee or occupational safety or health ("OSHA Law") arising
from or in connection with conditions at any facility of the Business or
other Purchased Asset if such conditions existed at the Effective Time,
provided that (A) Buyer provides notice to Seller of any such claim or
Liability not later than March 31, 1998, and (B) notwithstanding the
foregoing. Buyer shall be responsible for any capital expenditure to
remedies such facilities and Purchased Assets in order to comply with such
OSHA Law,
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and shall use reasonable best efforts to mitigate any such claims or
Liabilities by endeavoring to cure after governmental notice of violation
has been received, and shall proceed to implement procedures in accordance
with good business practice.
5. Buyer and Seller agree that proper accruals shall be made in accordance
with GAAP on the closing Date Balance for inter ail 1996 ad valorem real
estate taxes.
6. The following shall be added to Section 9.8: The Purchased Assets shall
include certain items as provided in the letter dated February 7, 1997
attached as Schedule 9.8. Seller further agrees to indemnify, defend and
hold harmless the Buyer Indemnified Parties from and against all Taxes and
Tax Losses (as to any event, net of any actual tax gain realized in
connection with the same event) payable as a result of the transactions
contemplated in Section 9.8 including without limitation any Taxes or Tax
Losses arising from the invalidity, transfer or repayment of any
intercompany loans or administration thereof, so as to put the Buyer
Indemnified Parties in all respects in the same position with respect to
Taxes and tax attributes that they would have had if the transactions
contemplated in Schedule 9.8 had not occurred and the Closing had occurred
as contemplated in this Agreement without reference to Schedule 9.8;
provided, that the foregoing shall not be subject to the limitations in
Section 9/4(a)(i) or (iii) hereof. Seller and Buyer agree to review the
transactions described in said February 7, 1997 letter during the sixty
days after Closing to ascertain whether such transactions may be
restructured in a manner more favorable or neutral the Parties provided
that neither Party shall be required to incur any additional expense in
such respect. The Closing Balance Sheet shall be prepared in all respects
as if the Closing had occurred without reference to the transactions
contemplated in Schedule 9.8."
7. This Amendment is limited as specified and shall not constitute a
modification of any other provision of the Acquisition Agreement. Except
as expressly amended hereby, the Acquisition Agreement shall continue in
full force and effect in accordance with the provisions thereof on the
date hereof. As used in the Acquisition Agreement, "herein."
"hereinafter," "hereto," hereof," and words of similar import shall,
unless the context otherwise requires, mean the Acquisition Agreement
after the amendments by this Amendment.
8. This Amendment may be executed in one or more identical counterparts,
each of which shall be deemed an original but all of which together will
constitute one and the same instrument.
In witness whereof, ESCO Electronics Corporation and Schawk, Inc., hereby
approve this Amendment as of the day and year first written above.
ESCO Electronics Corporation