Exhibit 10.1

 

 

 

AMENDED AND RESTATED ASSET PURCHASE AGREEMENT

 

by and among

 

ACETO CORPORATION,

 

ACETO AGRICULTURAL CHEMICALS CORPORATION

 

and

 

ACETO REALTY LLC,

 

as Sellers,

 

and

 

NMC ATLAS, L.P.,

 

as Buyer

 

Dated as of April 14, 2019

 

 

 

 
 

 

TABLE OF CONTENTS

 

  PAGES        ARTICLE I PURCHASE AND SALE 2       1.1 Purchased Assets 2      
1.2 Excluded Assets 4       1.3 Assumed Liabilities 6       1.4 Excluded
Liabilities 6       1.5 Assignments; Cure Amounts 8       1.6 Further Assurances
9       1.7 PILOT Program 9       1.8 Bulk Sales Laws 10       ARTICLE II
PURCHASE PRICE 10       2.1 Purchase Price 10       2.2 Closing Date Payment 10
      2.3 Good Faith Deposit 11       2.4 Adjustment to Base Purchase Price 11  
    2.5 Allocation of Purchase Price 13       2.6 Closing Date 13       2.7
Deliveries of Buyer 13       2.8 Deliveries of Sellers 14       2.9 Withholding
Rights 15       2.10 Transfer of Aceto Shanghai Interests 16       ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLERS 17       3.1 Organization 17       3.2
Acquired Subsidiaries 18       3.3 Corporate Authority Relative to this
Agreement; Consents and Approvals; No Violation 18       3.4 Financial
Statements 19       3.5 Compliance with Law; Permits 19       3.6 Environmental
Matters 20       3.7 Employee Benefit Plans 20       3.8 Litigation 21       3.9
Tax Matters 22       3.10 Employment and Labor Matters 23       3.11 Real and
Tangible Property 23

 

  i 

 

 

3.12 Intellectual Property 23       3.13 Material Contracts 24       3.14
Certain Regulatory Matters 24       3.15 Finders or Brokers 25       3.16
Sufficiency of Assets 25       3.17 Inventory 25       3.18 No Other
Representations or Warranties 25       ARTICLE IV REPRESENTATIONS AND WARRANTIES
OF BUYER 26       4.1 Organization 26       4.2 Corporate Authority Relative to
this Agreement; Consents and Approvals; No Violation 26       4.3 Litigation 26
      4.4 Buyer Information 27       4.5 Finders or Brokers 27       4.6
Solvency 27       4.7 Adequate Assurances Regarding the Buyer Assumed Agreements
27       4.8 Certain Arrangements; Ownership of Sellers 27       4.9 Guarantee
28       4.10 Investment Intention 28       4.11 Investigation; No Other
Representations 28       ARTICLE V COVENANTS AND AGREEMENTS 29       5.1 Conduct
of Business 29       5.2 Access 30       5.3 Employees and Employee Benefit
Plans 31       5.4 Regulatory Approvals; Efforts 33       5.5 Notification of
Certain Matters 35       5.6 Adequate Assurances regarding the Buyer Assumed
Agreements 35       5.7 Bankruptcy Court Approval 35       5.8 Taxes 35      
5.9 Public Announcements 37       5.10 Consents; Notices 37       5.11 WARN Act
38       5.12 Directors and Officers 38       5.13 Cooperation with Financing 39
      5.14 Controlled Substances 40       ARTICLE VI CONDITIONS TO THE PURCHASE
AND SALE 41       6.1 Conditions to Each Party’s Obligation to Close 41

 

  ii 

 

 

6.2 Conditions to Obligation of Sellers to Close 41       6.3 Conditions to
Obligation of Buyer to Close 41       ARTICLE VII TERMINATION 42       7.1
Termination 42       7.2 Effect of Termination 44       7.3 Break-Up Fee;
Expense Reimbursement 44       7.4 Return of Good Faith Deposit 45       ARTICLE
VIII MISCELLANEOUS 45       8.1 No Survival 45       8.2 Expenses 45       8.3
Counterparts; Effectiveness 45       8.4 Governing Law; Jurisdiction 45      
8.5 Remedies 46       8.6 WAIVER OF JURY TRIAL 46       8.7 Notices 46       8.8
Assignment; Binding Effect 48       8.9 Severability 48       8.10 Entire
Agreement 48       8.11 Amendments; Waivers 48       8.12 Headings 48       8.13
No Third-Party Beneficiaries 48       8.14 Interpretation 49       8.15
Non-Recourse 49       8.16 Definitions 49       8.17 Sellers Disclosure Schedule
62       8.18 Limitation on Good Faith Deposit Escrow Holder’s Liability 63

 

  iii 

 

  

SCHEDULES

 

Schedule 1.1(c) Assumed Contracts Schedule 1.1(d) Assumed Real Property Lease(s)
Schedule 1.1(e) Owned Real Property Schedule 1.1(f) Products Schedule 1.1(g)
Tangible Personal Property Schedule 1.1(i) Intellectual Property Schedule 1.1(l)
Assumed Equipment Leases Schedule 1.1(m) Excluded Claims Schedule 1.1(o) Assumed
Plans Schedule 1.1(r) Additional Purchased Assets Schedule 1.2(o) Additional
Excluded Assets Schedule 1.3(b) Accounts Payable Schedule 1.4(e) Excluded
Accrued Liabilities Schedule 1.4(f) Excluded Environmental Liabilities Schedule
1.5 Cure Costs Schedule 2.8(h) Share Transfer Requirements Schedule 2.8(i)
Additional Sellers’ Closing Deliverables     Sellers Disclosure Schedule Buyer
Disclosure Schedule

 

EXHIBITS

 

EXHIBIT A: Purchase Price Allocation Constraints EXHIBIT B: Form of Assignment
and Assumption Agreement EXHIBIT C: Form of Bill of Sale

 

  iv 

 

 

ASSET PURCHASE AGREEMENT

 

This AMENDED AND RESTATED ASSET PURCHASE AGREEMENT (this “Agreement”), dated as
of April 14, 2019 (the “Agreement Date”), is by and among Aceto Corporation, a
New York corporation (“Parent”), Aceto Realty LLC, a New York limited liability
company (“Aceto Realty”), and Aceto Agricultural Chemicals Corporation, a New
York corporation (“NY Agri” and together with Parent and Aceto Realty, “Sellers”
and each, a “Seller”), and NMC Atlas, L.P., a Delaware limited partnership
(“Buyer”). Capitalized terms used in this Agreement and not otherwise defined
above or in the text below have the meanings given to them in Section 8.16.

 

WHEREAS, Parent, collectively with its direct and indirect wholly-owned
subsidiaries (including NY Agri), is an international company engaged in the
development, marketing, sales and distribution of finished dosage form generic
pharmaceuticals, nutraceutical products, pharmaceutical active ingredients,
pharmaceutical intermediates, and specialty performance chemicals, including
agricultural intermediates and agricultural protection products (collectively,
the “Business”);

 

WHEREAS, the Business is organized along product lines into three principal
segments: (i) Human Health, (ii) Pharmaceutical Ingredients, and (iii)
Performance Chemicals;

 

WHEREAS, on February 19, 2019, Sellers and Buyer entered into an Asset Purchase
Agreement the “Original Agreement”) pursuant to which Sellers agreed to sell to
Buyer all of the Purchased Assets (as defined in the Original Agreement),
subject to the assumption by Buyer of the Assumed Liabilities (as defined in the
Original Agreement) (which Purchased Assets and Assumed Liabilities generally
comprise the Chemical Plus Business), and Buyer agreed to purchase from Sellers
such Purchased Assets and assume such Assumed Liabilities, in each case, upon
the terms and conditions set forth in the Original Agreement;

 

WHEREAS, Sellers and certain of their Affiliates filed voluntary petitions for
relief commencing cases (collectively, the “Bankruptcy Case”) under Chapter 11
of Title 11 of the United States Code, 11 U.S.C. §§ 101, et seq. (the
“Bankruptcy Code”), on February 19, 2019 (the “Petition Date”) in the United
States Bankruptcy Court for the District of New Jersey (the “Bankruptcy Court”)
under Case No. 19-13448;

 

WHEREAS, Sellers and Buyer desire to amend and restate in its entirety the
Original Agreement as set forth herein;

 

WHEREAS, the Parties intend to effectuate the transactions contemplated hereby,
including the purchase and sale of the Purchased Assets and the assumption of
the Assumed Liabilities (the “Asset Purchase”), pursuant to Section 363 and 365
of the Bankruptcy Code;

 

WHEREAS, Buyer is the “Successful Bidder” as such term is defined in the Bidding
Procedures Order (as defined herein);

 

WHEREAS, the execution and delivery of this Agreement and Sellers’ ability to
consummate the transactions contemplated hereby are subject, among other things,
to the entry of the Sale Order pursuant to, inter alia, Sections 363 and 365 of
the Bankruptcy Code;

 

WHEREAS, the Parties desire to consummate the transactions contemplated hereby
as promptly as practicable after the Bankruptcy Court enters the Sale Order; and

 

 1 

 

 

WHEREAS, the Parties desire to make certain representations, warranties,
covenants and agreements specified herein.

 

NOW, THEREFORE, in consideration of the foregoing and the representations,
warranties, covenants and agreements contained herein, and intending to be
legally bound hereby, Buyer and Sellers hereby agree to amend and restate the
Original Agreement as follows:

 

ARTICLE I
PURCHASE AND SALE

 

1.1          Purchased Assets. In addition to all properties and assets of the
Acquired Subsidiaries (which shall remain properties and assets of such entities
upon the Closing, but which shall not constitute Purchased Assets for purposes
of this Agreement), on the terms and subject to the conditions set forth in this
Agreement, at the Closing, Sellers shall sell, transfer, assign, convey and
deliver to Buyer, and Buyer shall purchase, free and clear of all Liabilities
and Liens (other than Liens created by Buyer and Permitted Liens), the right,
title and interest of Sellers in, to or under all of the properties and assets
of Sellers used primarily in the Chemical Plus Business (other than the Excluded
Assets), including the following (herein collectively called the “Purchased
Assets”):

 

(a)       all outstanding shares of capital stock or other equity interests of
the Purchased Subsidiaries (other than (i) 8,401 shares of Aceto HK that are
owned by Aceto Bermuda and (ii) 70% of the outstanding equity interests of the
Joint Venture, which are owned by United Phosphorus Inc.); provided,
notwithstanding anything contained herein to the contrary, Buyer may, upon prior
written notice to Sellers, assign the right to purchase such shares of capital
stock or other equity interests to one or more wholly-owned Subsidiaries of the
Buyer; provided, further, that no such assignment shall relieve Buyer of any
Liability or obligation under this Agreement; provided further that, at the
request of Buyer, NY Agri will transfer to Aceto Bermuda, contemporaneously with
Closing, the one share of capital stock of Aceto HK owned by NY Agri;

 

(b)       the Accounts Receivable and Intercompany Accounts Receivable of
Sellers outstanding as of the Closing Date;

 

(c)       to the extent assignable pursuant to Sections 363 and 365 of the
Bankruptcy Code, the Contracts listed or described on Schedule 1.1(c) as of the
Assumption Deadline, as may be amended by Buyer as provided herein (the “Assumed
Contracts”), and all purchase orders of the Sellers in respect of the Acquired
Business that are issued in the Ordinary Course of Business and outstanding as
of the Closing Date (the “Assumed Purchase Orders”);

 

(d)       to the extent assignable pursuant to Sections 363 and 365 of the
Bankruptcy Code, the Real Property Lease(s) of Sellers, and rights thereunder,
listed or described on Schedule 1.1(d) (such Real Property Lease(s), the
“Assumed Real Property Lease(s)”);

 

(e)       subject to Section 1.7, any Owned Real Property of a Seller set forth
on Schedule 1.1(e);

 

(f)       all rights (including goodwill, if any) in and to the products set
forth on Schedule 1.1(f) (the “Products”) and all Product registrations and
related registration information (including applications that are in the process
of being prepared by a Seller or an Acquired Subsidiary for Product
registrations);

 

 2 

 

 

(g)       the equipment, machinery, forklifts, vehicles, fixtures, furniture,
furnishings, signage, leasehold improvements and other tangible personal
property owned by each Seller as of the Closing Date that are (A) located on or
at the Acquired Real Property and held primarily for, or used primarily in, the
Acquired Business, (B) held primarily for, or used primarily in, the Acquired
Business and existing as of the Closing or (C) set forth on Schedule 1.1(g);

 

(h)       to the extent assignable pursuant to Sections 363 and 365 of the
Bankruptcy Code, all Permits and pending applications therefor;

 

(i)       to the extent assignable pursuant to Sections 363 and 365 of the
Bankruptcy Code, all Intellectual Property that is owned or licensed by each
Seller (A) held primarily for, or used primarily in, the Acquired Business and
existing as of the Closing or (B) set forth on Schedule 1.1(i);

 

(j)       all Books and Records related primarily to the Acquired Business,
except those: (i) relating primarily to any Excluded Asset or Excluded
Liability; (ii) relating primarily to employees of a Seller or any Purchased
Subsidiary who are not Transferred Employees; or (iii) that a Seller or any
Purchased Subsidiary is not permitted to transfer under applicable Law;

 

(k)       all telephone and facsimile numbers, email and web addresses, social
media accounts and other directory listings used primarily in connection with
the Acquired Business, to the extent assignable;

 

(l)       to the extent assignable pursuant to Sections 363 and 365 of the
Bankruptcy Code, the equipment leases listed or described on Schedule 1.1(l)
(the “Assumed Equipment Leases” and together with the Assumed Contracts and
Assumed Real Property Lease(s), the “Buyer Assumed Agreements”);

 

(m)       other than as set forth on Schedule 1.1(m), any rights, claims,
credits, refunds, causes of action, choses in action, rights of recovery and
rights of setoff of each Seller against third parties arising out of, or
primarily related to, the Purchased Assets or the Acquired Business, including
any rights in connection with product returns, rebates, credits and related
claims and any rights under or pursuant to any and all warranties,
representations and guarantees made by suppliers, manufacturers and contractors
relating to products sold, or services provided, to each Seller primarily
related to the Purchased Assets or the Acquired Business;

 

(n)       all rights of each Seller under non-disclosure or confidentiality,
non-disparagement, non-compete, or non-solicitation agreements with the
Transferred Employees or any employees of each Seller terminated within two (2)
years prior to the Closing Date, or with any agents of each Seller or with third
parties, in each case, related primarily to the Acquired Business;

 

(o)       (1) the Seller Benefit Plans listed on Schedule 1.1(o)(1), solely to
the extent such pertains to a Transferred Employee and (2) the Seller Benefit
Plans listed on Schedule 1.1(o)(2), whether or not pertaining to a Transferred
Employee (collectively, the “Assumed Plans”), and any trusts, assets, reserves,
credits and service agreements, but only to the extent of the Transferred
Employees, and all documents created, filed or maintained in connection with the
Assumed Plans to the extent transferable in accordance with the existing terms
and conditions of such Assumed Plans, any applicable insurance policies related
to the Assumed Plans and Bankruptcy Court approval;

 

(p)       all Purchased Deposits;

 

 3 

 

 

(q)       all Inventory held by each Seller primarily for use in the Acquired
Business as of the Closing Date;

 

(r)       the additional assets listed on Schedule 1.1(r);

 

(s)       all rights under insurance policies of the Sellers to the extent
relating to any Assumed Liability;

 

(t)       all goodwill as of the Closing Date that is associated with the
Acquired Business not expressly referenced in Sections 1.1(a) through 1.1(s);
and

 

(u)       all avoidance actions (including any proceeds thereof), including all
claims and causes of action arising under Sections 544 through 553 of the
Bankruptcy Code or any analogous state law, but only to the extent such actions
are against the following parties (collectively, the “Designated Parties”): (i)
any of the Sellers’ vendors, suppliers, customers, or trade creditors in regards
or related to the Purchased Assets or Acquired Business and (ii) any
counterparties to any Buyer Assumed Agreements (collectively, the “Purchased
Avoidance Actions”); provided, that it is understood and agreed by the parties
that the Buyer will not assert or pursue any Purchased Avoidance Actions against
any of the Designated Parties other than as a defense, offset, or counterclaim
against any claim or cause of action raised or asserted by such Designated
Party.

 

Buyer shall have the right at any time prior to 5:00 p.m. prevailing Eastern
Time on the day that is one (1) day prior to the Auction to amend Schedule
1.1(c) in accordance with the Bidding Procedures and Bidding Procedures Order so
as to exclude any Contract from being an Assumed Contract. A schedule of Assumed
Contracts and any Cure Costs relating thereto (to the extent such Assumed
Contracts have not already been included on one or more notices of potential
assumption and assignment of executory contracts and unexpired leases filed by
Sellers with the Bankruptcy Court) shall be filed by Sellers with the Bankruptcy
Court and served on the counterparties to the Assumed Contracts in accordance
with the Bidding Procedures Order. Notwithstanding anything to the contrary, in
connection with any change to Schedule 1.1(c) described in the preceding
sentence, (i) any Purchased Assets exclusively related to any Contract that is
excluded shall become an Excluded Asset to the extent applicable in accordance
with Section 1.2, (ii) Sellers shall be permitted to update the Sellers
Disclosure Schedule as necessary to correct or complete any such disclosure
contained therein, (iii) Buyer acknowledges and agrees that there shall be no
reduction in the Purchase Price if it elects to remove any Contract listed on
Schedule 1.1(c), and (iv) the Cure Cost shall be adjusted, as applicable.

 

1.2          Excluded Assets. Notwithstanding the provisions of Section 1.1,
nothing herein contained shall be deemed to sell, transfer, assign or convey to
Buyer (i) the assets of the Excluded Subsidiaries or (ii) the Excluded Assets.
The Excluded Subsidiaries shall retain all right, title and interest to, in and
under the assets of the Excluded Subsidiaries, and the Sellers shall retain all
right, title and interest to, in and under the Excluded Assets. For all purposes
of and under this Agreement, the term “Excluded Assets” shall mean the following
assets of each Seller:

 

(a)       all shares of capital stock or other equity interest of each Seller
and the Excluded Subsidiaries or any securities convertible into, exchangeable,
or exercisable for shares of capital stock or other equity interest of Sellers
or any of the Excluded Subsidiaries;

 

(b)       all Cash of Sellers;

 

(c)       any Contracts other than Buyer Assumed Agreements;

 

 4 

 

 

(d)       any lease of Leased Real Property, and rights thereunder, that is not
a Buyer Assumed Agreement (the “Excluded Real Property Leases”);

 

(e)       any equipment leases other than Assumed Equipment Leases (the
“Excluded Equipment Leases”);

 

(f)       all minute books, stock ledgers, corporate seals and stock
certificates of each Seller and other similar Books and Records (1) that are
primarily related to any Excluded Assets or Excluded Liabilities, or (2) which a
Seller or any of the Excluded Subsidiaries is required by Law or determines are
necessary or advisable to retain, including all Tax Returns and related
workpapers (other than Tax Returns and related workpapers of the Acquired
Subsidiaries), financial statements and corporate or other entity filings (but
copies of such Books and Records identified in this clause (f) shall be retained
by Sellers and made available to Buyer upon Buyer’s reasonable request and at
Buyer’s expense);

 

(g)       all Seller Benefit Plans, except the Assumed Plans, and trusts or
other assets attributable thereto (except to the extent provided by Section
5.3(f)), including any assets, reserves, credits and service agreements, and all
documents created, filed or maintained in connection with such Seller Benefit
Plans and any applicable insurance policies related to such Seller Benefit
Plans;

 

(h)       any rights, claims or causes of action of each Seller under this
Agreement or the Ancillary Documents and as set forth on Schedule 1.1(m);

 

(i)        all receivables, claims or causes of action related primarily to any
Excluded Asset or Excluded Liability, including any such item to the extent
arising under any guarantee, warranty, indemnity or similar right in favor of a
Seller or any of the Excluded Subsidiaries in respect of an Excluded Asset or
Excluded Liability;

 

(j)        all refunds, credits and rebates of Taxes;

 

(k)       all rights under insurance policies relating to claims for losses
pending as of the Closing Date except to the extent such losses are an Assumed
Liability;

 

(l)        all Intellectual Property owned or licensed by Sellers that is
neither: (i) held primarily for, nor (ii) used primarily in, the Acquired
Business, with respect to subclauses (i) and (ii) other than as set forth on
Schedule 1.1(i);

 

(m)      all post-petition adequate assurance deposits provided to utilities and
any deposits provided to suppliers or service providers to a Seller on a
prepetition or post-petition basis;

 

(n)       all derivative financial instruments, including, except to the extent
assigned pursuant to Section 1.1(r), future foreign currency contracts;

 

(o)       all other assets set forth on Schedule 1.2(o);

 

(p)       any and all accounts receivable owed to any Seller from any other
Seller or any Affiliate of a Seller (other than an Acquired Subsidiary); and

 

(q)       all avoidance actions (including any proceeds thereof), including all
claims or causes of action arising under Sections 544 through 553 of the
Bankruptcy Code or any analogous state law, other than the Purchased Avoidance
Actions.

 

 5 

 

 

For the avoidance of doubt, no goodwill or other intangible assets not expressly
set forth in this Section 1.2 shall constitute “Excluded Assets.”

 

1.3          Assumed Liabilities. In addition to the Liabilities of the Acquired
Subsidiaries (which shall remain Liabilities of such entities upon the Closing,
but which shall not constitute Assumed Liabilities for purposes of this
Agreement), upon the terms and subject to the conditions set forth in this
Agreement, at the Closing, Buyer shall assume and agree to pay, perform and
discharge, when due (in accordance with its respective terms and subject to the
respective conditions thereof), only the following Liabilities (without
duplication) (collectively the “Assumed Liabilities”) and no others:

 

(a)       any and all Liabilities of each Seller arising under the Buyer Assumed
Agreements and the Assumed Purchase Orders;

 

(b)       (i) the obligation to pay the amounts owed (and no other Liabilities)
for goods or services received by each Seller in the Ordinary Course of Business
in respect of any trade and vendor accounts payable due as of, or after, the
Petition Date, including the amounts set forth on Schedule 1.3(b), but only to
the extent incurred in connection with the Acquired Business, and excluding any
amounts owed to professionals retained by an order of the Bankruptcy Court under
Section 327, 328, 1102 or 1103 of the Bankruptcy Code (such payables, the
“Accounts Payable”) and (ii) any accounts payable from any Seller to any
Acquired Subsidiary outstanding as of the Closing Date;

 

(c)       all Accrued Liabilities;

 

(d)       any and all Liabilities arising under any Assumed Plan, if any (to the
extent transferable in accordance with the existing terms and conditions of the
applicable Assumed Plan);

 

(e)       other than as set forth on Schedule 1.4(f), any Liability directly
related to the Acquired Business arising under Environmental Laws attributable
to or incurred as a result of any acts, omissions, or conditions first occurring
after the Closing, including any Liability with respect to the release,
handling, discharge, treatment, storage, generation, disposal, or presence of
Regulated Substances at any location and compliance with any Environmental Laws,
in each case first occurring after the Closing, relating to the foregoing;

 

(f)       all Liabilities arising out of the conduct of the Acquired Business,
ownership of the Purchased Assets, or associated with the Transferred Employees
on or after the Closing Date;

 

(g)       all Taxes arising out of the conduct of the Acquired Business,
ownership of the Purchased Assets or associated with the Transferred Employees,
in each case, attributable to periods (or portions thereof) beginning after the
Closing Date; and

 

(h)       all Liabilities under the WARN Act arising as a result of a failure of
Buyer to comply with Section 5.11.

 

1.4          Excluded Liabilities. Notwithstanding any provision in this
Agreement to the contrary, Buyer shall not assume and shall not be obligated to
assume or be obliged to pay, perform or otherwise discharge any Liability of any
Seller, and each Seller shall be solely and exclusively liable with respect to
all Liabilities of such Seller, other than the Assumed Liabilities
(collectively, the “Excluded Liabilities”). For the avoidance of doubt and
notwithstanding anything to the contrary in this Agreement, the Excluded
Liabilities with respect to each Seller include (i) any claims under Sections
503 and 507 of the Bankruptcy Code and (ii) the following:

 

 6 

 

 

(a)       any Liability of such Seller, arising out of, or relating to, this
Agreement or the transactions contemplated hereby, whether incurred prior to, at
or subsequent to the Closing Date, including all finder’s or broker’s fees and
expenses and any and all fees and expenses of any Representatives of such
Seller, but excluding (x) any Liabilities of such Seller arising from or
otherwise attributable to a breach of the covenant in Section 5.8(a), and (y)
any Transfer Taxes as provided in Section 5.8(b);

 

(b)       any Liability incurred by either Seller’s respective directors,
officers, managers, stockholders, members, partners, agents or employees (acting
in such capacities);

 

(c)       any Liability of such Seller to any Person on account of any
Proceeding to the extent relating to facts, circumstances or events that existed
or occurred before the Closing;

 

(d)       any Liability to the extent relating to, resulting from, or arising
out of the ownership or operation of an Excluded Asset;

 

(e)       the accrued Liabilities of such Seller set forth on Schedule 1.4(e);
provided, however, notwithstanding anything to the contrary set forth in this
Agreement, in no event shall any Accrued Liability constitute an Excluded
Liability;

 

(f)       any Liability arising out of or incurred as a result of any actual or
alleged violation by any Seller of any Law prior to the Closing, or related to
the Acquired Business that arises under or relates to a violation of or
obligation under Environmental Laws with respect to acts, omissions or
conditions occurring on or prior to the Closing, including any Liability of any
Seller or related to the Acquired Business with respect to the release,
handling, discharge, treatment, storage, generation, disposal or presence of
Regulated Substances occurring on or prior to the Closing at any location,,
including as set forth on Schedule 1.4(f);

 

(g)       all checks and drafts that have been written or submitted by such
Seller prior to the close of business on the Closing Date but have not yet
cleared;

 

(h)       other than as explicitly included in Assumed Liabilities, any
Liability of such Seller for any Indebtedness, including Indebtedness under the
Credit Facility, any Indebtedness owed to any stockholder or other Affiliate of
any such Seller, and any Contract evidencing any such financing arrangement;

 

(i)       all Liabilities under the WARN Act to the extent resulting from an
employment loss or layoff (as defined in the WARN Act) initiated by Seller or
any of its Affiliates or the purchaser of the Pharma Business;

 

(j)       all Liabilities in respect of any employee or other service provider
of Seller or any of its Affiliates who does not become a Transferred Employee
(whether arising prior to, on or after the Closing Date), and all Liabilities
(other than any Assumed Liability) in respect of any Transferred Employee
arising prior to the Closing Date;

 

(k)       other than (x) Tax Liabilities included in clauses (ii) or (vii) of
the definition of Accrued Liabilities, and (y) Transfer Taxes for which Buyer is
responsible pursuant to Section 5.8(b), (i) all Liabilities for Taxes of such
Seller or its Affiliates (other than the Acquired Subsidiaries) for any taxable
period, and (ii) Liabilities for Taxes relating to the Acquired Business or the
Purchased Assets attributable under the principles of Section 5.8(c) to periods
(or portions thereof) ending on or prior to the Closing Date, except for any
Taxes of an Acquired Subsidiary, in each case;

 

 7 

 

 

(l)       any and all accounts payable owed by any Seller to any other Seller or
any Affiliate of a Seller (other than an Acquired Subsidiary); and

 

(m)       other than as specifically set forth herein, fees or expenses of such
Seller incurred with respect to the transactions contemplated by this Agreement.

 

1.5          Assignments; Cure Amounts.

 

(a)       Notwithstanding anything to the contrary contained herein, Buyer
reserves the right, in consultation with Sellers, to amend or supplement, at any
time prior 5:00 p.m. prevailing Eastern Time on the day that is one (1) day
prior to the Auction (the “Assumption Deadline”), Schedule 1.1(c) to add any
contracts, so long as any such contract to be added to Schedule 1.1(c) (x) is
not to be assumed or available to be assumed pursuant to any other sale or
transaction previously approved by the Bankruptcy Court in connection with the
Bankruptcy Case, and (y) is added to such schedule(s) prior to the entry of any
Order of the Bankruptcy Court approving the rejection of such contract or lease,
and subject to the party to such contract or lease receiving information
evidencing Buyer’s adequate assurance of future performance and having an
opportunity to object within seven (7) days or such other period of time set
forth in an Order of the Bankruptcy Court of the receipt of such information to
the assignment of such contract or lease on the ground that Buyer has not
demonstrated adequate assurance of future performance of such contract or lease
pursuant to Section 365 of the Bankruptcy Code. Any contract added to Schedule
1.1(c) (to the extent consistent with the prior sentence) shall be deemed an
Assumed Contract. Each Seller shall transfer and assign all Buyer Assumed
Agreements (that such Seller is a party thereto and to the extent assignable
pursuant to Sections 363 and 365 of the Bankruptcy Code) to Buyer, and Buyer
shall assume all Buyer Assumed Agreements from a Seller that is a party thereto,
as of the Assumption Deadline pursuant to Section 365 of the Bankruptcy Code and
the Sale Order. In connection with and as a prerequisite to such assignment and
assumption, Buyer shall pay in full all costs (as determined by such Seller that
is party thereto based on the Books and Records of such Seller or as otherwise
determined by the Bankruptcy Court) to cure all defaults under such Buyer
Assumed Agreements to the extent required by Section 365(b) of the Bankruptcy
Code (such amounts, the “Cure Costs”) and Sellers shall have no Liability
therefore. The Cure Costs for each Buyer Assumed Agreement are set forth
opposite the name of each Buyer Assumed Agreement set forth on Schedule 1.5, but
for the avoidance of doubt, to the extent that the Cure Costs for any Buyer
Assumed Agreement are determined by the Bankruptcy Court to be higher than the
amounts listed on Schedule 1.5, Buyer shall be fully responsible to pay such
higher Cure Costs.

 

(b)       The Sale Order shall provide that as of the Closing, each Seller shall
assign to Buyer the Buyer Assumed Agreements to which it is a party, with each
Buyer Assumed Agreement identified by its name and date (if available), the
other party to such Buyer Assumed Agreement and the address of such party for
notice purposes, all included on one or more exhibit(s) attached to either the
motion filed in connection with the Sale Order or one or more motion(s) or
notice(s) regarding such Seller’s intention to have such Buyer Assumed Agreement
assumed by, and assigned to, Buyer. Such exhibit(s) shall also (i) set forth the
Cure Costs (if any) necessary to cure any defaults under each Buyer Assumed
Agreement and (ii) delineate a procedure for transferring to Buyer the rights to
any Purchased Deposits in the form of cash or letters of credit on deposit with
the other party to any Assumed Real Property Lease.

 

(c)       In the case of licenses, certificates, approvals, authorizations,
leases, Contracts and other commitments included in the Purchased Assets that
cannot be transferred or assigned effectively without the consent of third
parties, which consent has not been obtained prior to the Closing (after giving
effect to the Sale Order and the Bankruptcy Code), Sellers shall, at Buyer’s
sole cost and expense, paid in advance, subject to any approval of the
Bankruptcy Court that may be required and the terms set forth in Section 5.4,
cooperate with Buyer in endeavoring to obtain such consent (or restructure the
acquisition of the underlying asset and unwind any associated agreements to
enable the acquisition thereof) and this Agreement shall not operate as an
assignment thereof in violation of any such license, certificate, approval,
authorization, Real Property Lease, Contract or other commitment. For the
avoidance of doubt, Sellers shall not be obligated to pay any consideration to
any third party from whom consent or approval is requested or otherwise incur
any out-of-pocket costs or expenses, or to initiate any litigation or
Proceedings to obtain any such consent or approval.

 

 8 

 

 

1.6          Further Assurances.

 

(a)       At the Closing, and at all times thereafter as may be necessary,
Sellers and Buyer shall, at Buyer’s sole cost and expense, execute and deliver
such other instruments of transfer as shall be reasonably necessary to vest in
Buyer title to the Purchased Assets free and clear of all Liens (other than
Permitted Liens), and such other instruments as shall be reasonably necessary to
evidence the assignment by Sellers and the assumption by Buyer or its designee
of the Assumed Liabilities, including the Buyer Assumed Agreements. Each of
Sellers, on the one hand, and Buyer, on the other hand, shall cooperate with one
another to execute and deliver such other documents and instruments as may be
reasonably required to carry out the transactions contemplated by this
Agreement; provided, however, that Sellers’ compliance with its obligations
under this Section 1.6 shall, in each case, be conditioned upon Buyer’s
advancement of any expenses to be incurred by Sellers in connection therewith.
At the Closing, and at all times thereafter as may be necessary, Buyer shall
cooperate with Sellers, at Parent’s request, to facilitate the procurement,
possession and return to Sellers of any Excluded Assets, including any equipment
subject to any lease which does not constitute an Assumed Equipment Lease.

 

(b)       At the Closing, and at all times thereafter as may be necessary,
Sellers shall, at the reasonable request and expense of Buyer, execute, deliver,
and file, or cause to be executed, delivered, and filed, such other instruments
of conveyance and transfer and take such other actions as Buyer may reasonably
request, in order to more effectively consummate the transactions contemplated
hereby and to vest in Buyer good and marketable title to the Intellectual
Property included in the Purchased Assets, including executing, filing, and
recording, with all appropriate intellectual property registration authorities
and other relevant entities, all assignment instruments and other filings that
are necessary to correctly record the prior chain of title with respect to
ownership of the Intellectual Property included in the Purchased Assets.

 

1.7          PILOT Program. Aceto Realty shall use its commercially reasonable
efforts to, prior to Closing, exercise its option to terminate the arrangements
set forth on Schedule 1.7 and repurchase the real property to which such
arrangements relate (the “Port Washington Property” and, such exercise of such
option and repurchase of the Port Washington Property, the “PILOT Unwind”), in
which case, Aceto Realty shall sell, convey, transfer, deliver and assign all of
its right, title and interest in and to the Port Washington Property to Buyer at
the Closing and such real property shall constitute “Owned Real Property” for
all purposes of this Agreement. If Aceto Realty is unable to complete the PILOT
Unwind prior to the Closing: (a) Aceto Realty shall retain, and not assign to
Buyer, the lease(s) and other arrangements set forth on Schedule 1.7, (b) Aceto
Realty shall cooperate with Buyer, at Buyer’s sole expense, in any lawful and
reasonable arrangement reasonably proposed by Buyer under which Buyer shall use
the Port Washington Property and otherwise obtain the economic claims, rights
and benefits thereunder (including subcontracting, sublicensing or subleasing),
and (c) Aceto Realty shall complete the PILOT Unwind as soon as practicable
after the Closing, and upon such completion sell, convey, transfer, deliver and
assign all of its right, title and interest in and to the Port Washington
Property to Buyer. Prior to the Closing, Aceto Realty shall use its commercially
reasonable efforts to cooperate with Buyer, at Buyer’s sole expense, in
connection with any lawful and reasonable alternative to the PILOT Unwind
requested by Buyer for transferring to Buyer at Closing either the Port
Washington Property or the arrangements set forth on Schedule 1.7. For the
avoidance of doubt, provided that Aceto Realty has complied with its obligations
set forth in this Section 1.7, neither completion of the PILOT Unwind, nor
completion of any alternatives thereto requested by Buyer, shall be a condition
to Closing.

 

 9 

 

 

1.8          Bulk Sales Laws. Buyer hereby waives compliance by Sellers with the
requirements and provisions of any “bulk-transfer” Law of any jurisdiction that
may otherwise be applicable with respect to the sale of any or all of the
Purchased Assets to Buyer. Pursuant to Section 363(f) of the Bankruptcy Code,
the transfer of the Purchased Assets shall be free and clear of any and all
Liens and Liabilities in the Purchased Assets (other than Permitted Liens),
including any Liens or claims arising out of any bulk- transfer Laws, and the
Parties shall take such steps as may be necessary or appropriate to so provide
in the Sale Order.

 

ARTICLE II
PURCHASE PRICE

 

2.1          Purchase Price. The aggregate consideration for the Purchased
Assets (the “Base Purchase Price”) shall be the sum of the following:

 

(a)       the Good Faith Deposit; plus

 

(b)       (i) cash in the amount of three hundred thirty-two million four
hundred forty thousand dollars ($332,440,000), plus (ii) the amount, if any, by
which Net Current Assets exceeds one hundred twelve million four hundred nine
thousand seven hundred eighty-eight dollars ($112,409,788), minus (iii) the
amount, if any, by which Net Current Assets are less than one hundred twelve
million four hundred nine thousand seven hundred eighty-eight dollars
($112,409,788), minus (iv) Net Debt (such amount, as adjusted pursuant to
Section 2.4 below, the “Cash Balance”); plus

 

(c)       the Cure Costs; plus

 

(d)       if the Closing occurs on or after April 30, 2019, for any reason other
than an adjournment of the Sale Hearing, at the initial request of the Sellers
(and not at the initial request of the Bankruptcy Court, the U.S. Trustee or any
other party in interest), to a date that is after April 26, 2019, the
Prepetition Credit Agreement Penalty (if any); plus

 

(e)       the assumption by Buyer of the Assumed Liabilities.

 

2.2          Closing Date Payment. At the Closing, Buyer shall satisfy the Base
Purchase Price as follows:

 

(a)       Buyer shall deliver the Estimated Cash Balance less the Adjustment
Escrow Amount, via wire transfer of immediately available funds into the
account(s) designated in writing by Parent;

 

(b)       Buyer shall deposit an amount equal to ten million dollars
($10,000,000) (the “Adjustment Escrow Amount”) via wire transfer of immediately
available funds into an escrow account (the “Adjustment Escrow”) with Citibank,
N.A. or such other financial institution as shall be satisfactory to Parent and
Buyer (the “Escrow Agent”), to be held and disbursed by the Escrow Agent in
accordance with the terms and conditions of this Agreement and an escrow
agreement (the “Escrow Agreement”) with the Escrow Agent, such escrow agreement
to be mutually acceptable to the Parties. The fees and expenses of the Escrow
Agent shall be borne and paid by Buyer;

 

 10 

 

 

(c)       Buyer shall pay directly to the obligees identified on Schedule 1.5
the Cure Costs;

 

(d)       If determined to be payable in accordance with Section 2.1(d), Buyer
shall pay to Parent an amount in cash equal to the Prepetition Credit Agreement
Penalty via wire transfer of immediately available funds into the account(s)
designated in writing by Parent; and

 

(e)       Buyer shall assume the Assumed Liabilities; provided, however, that to
the extent any such Assumed Liabilities are able to be satisfied at Closing,
without preventing the transfer of the Purchased Assets or the assumption of the
Assumed Liabilities, Buyer shall satisfy such Assumed Liabilities either at
Closing or, in Buyer’s sole discretion, in the ordinary course of business.

 

2.3          Good Faith Deposit. Buyer has deposited into an escrow account (the
“Good Faith Deposit Escrow”) at Bank of America maintained by Lowenstein Sandler
LLP, counsel to Sellers (the “Good Faith Deposit Escrow Holder”), an amount
equal to thirty-three million eight hundred thousand dollars $33,800,000 (the
“Good Faith Deposit”) in immediately available funds. The Good Faith Deposit has
been funded by Buyer pursuant to the Bidding Procedures. Following the execution
of this Agreement by the Parties, other than upon termination of this Agreement
by Sellers pursuant to Section 7.1(d) or Section 7.1(k), in which case, the Good
Faith Deposit shall be nonrefundable and paid to Sellers pursuant to the terms
of this Section 2.3, the Good Faith Deposit shall be refunded to Buyer upon the
termination of this Agreement for any reason. At the Closing, the Good Faith
Deposit (and any interest or income accrued thereon) shall be paid over to
Sellers by the Good Faith Deposit Escrow Holder and, upon such payment, the Good
Faith Deposit shall be credited and applied toward payment of the Purchase Price
(but shall not reduce the amount of the Cash Balance). In the event the Good
Faith Deposit is finally determined by the Bankruptcy Court to have become
nonrefundable as provided herein before the Closing by reason of Sellers
terminating this Agreement pursuant to Section 7.1(d) or Section 7.1(k), the
Good Faith Deposit Escrow Holder shall immediately disburse the Good Faith
Deposit and all interest or income accrued thereon to Sellers to be retained by
Sellers for their own account. Sellers’ retention of the Good Faith Deposit
pursuant to the preceding sentence shall constitute liquidated damages and shall
be the exclusive damages available to the Sellers in the event of any
termination by Sellers pursuant to Section 7.1(d) (except in the case of a
Willful Breach of this Agreement by Buyer, in which case Sellers’ retention of
the Good Faith Deposit shall be in addition to any other remedies the Sellers
may have under Section 8.5) or Section 7.1(k). If this Agreement terminates in
accordance with the termination provisions hereof for any reason other than by
Sellers pursuant to Section 7.1(d) or Section 7.1(k), Sellers shall cause the
Good Faith Deposit Escrow Holder to return to Buyer, without prejudice to
Buyer’s right to receive the Break-Up Fee and Expense Reimbursement, if any,
when payable in accordance with Section 7.3(a), the Good Faith Deposit (together
with all income or interest accrued thereon), within three (3) Business Days
after this Agreement is so terminated. The Parties hereto agree that, prior to
the earliest of (i) application of the Good Faith Deposit against the payment of
the Purchase Price, (ii) the Good Faith Deposit becoming nonrefundable as
provided herein before the Closing by reason of Sellers terminating this
Agreement pursuant to Section 7.1(d) or Section 7.1(k) or (iii) the return of
the Good Faith Deposit to Buyer under the provisions of this Section 2.3, the
Good Faith Deposit shall be treated for federal, and applicable state and local,
income Tax purposes as owned by Buyer.

 

2.4          Adjustment to Base Purchase Price.

 

(a)       Not later than three (3) Business Days prior to the Closing, Parent
shall deliver to Buyer a statement setting forth Parent’s good faith and
reasonably detailed estimate of Net Current Assets (the “Estimated Net Current
Assets”), Net Debt (“Estimated Net Debt”), and the Cash Balance based thereon
(the “Estimated Cash Balance”).

 

 11 

 

 

(b)       Not later than forty-five (45) days following the Closing, Buyer shall
deliver to Parent a statement (the “Closing Statement”) setting forth Buyer’s
good faith and reasonably detailed calculation of Net Current Assets, Net Debt
and the Cash Balance based thereon. If the Cash Balance, as finally determined
by this Section 2.4, is less than the Estimated Cash Balance, the Base Purchase
Price shall be adjusted downward by the absolute value of such difference (the
“Shortfall”). If the Cash Balance, as finally determined by this Section 2.4, is
greater than the Estimated Cash Balance, the Base Purchase Price shall be
adjusted upward by the absolute value of such difference (the “Surplus”).

 

(c)       The Adjustment Escrow Amount shall be payable in accordance with the
Closing Statement and Section 2.4(d) no later than forty-five (45) days after
receipt by Parent of the Closing Statement (and Sellers and Buyer shall instruct
the Escrow Agent accordingly) unless and to the extent Parent delivers a notice
of disagreement in accordance with the following sentence, setting forth the
basis for such disagreement and Parent’s calculation of Net Current Assets, Net
Debt and the Cash Balance based thereon. During the forty five (45) day period
referred to above, Buyer shall and shall cause the Acquired Subsidiaries to
provide Parent and its representatives reasonable access to the relevant books,
records, facilities and employees of the Acquired Business and the Acquired
Subsidiaries to evaluate the calculation of Net Current Assets, Net Debt and the
Cash Balance based thereon. In the event of any such disagreement, Parent shall
so notify Buyer in writing prior to the end of the forty five (45) day period
referred to above, and the Parties shall use their commercially reasonable
efforts to resolve such disagreement. If the Parties are unable to resolve their
disagreement through such consultation, the Parties shall refer the disagreement
to the Accounting Firm to review promptly the Closing Statement and the disputed
items or amounts. Promptly, but no later than twenty (20) days after acceptance
of its appointment, the Accounting Firm shall determine (it being understood
that in making such determination, the Accounting Firm shall be functioning as
an expert and not as an arbitrator), based solely on written submissions by
Buyer and Parent, and not by independent review, only those issues in dispute
and shall render a written report as to the resolution of those issues in
dispute and the resulting computation of Net Current Assets, Net Debt and the
Cash Balance based thereon, as the case may be, which shall be conclusive and
binding on the Parties. In resolving any disputed item, the Accounting Firm (x)
shall be bound by the provisions of this Section 2.4 and (y) may not assign a
value to any item greater than the greatest value for such items claimed by
either Party or less than the smallest value for such items claimed by either
Party or include in its computation any item not included in the computation
provided by either Party. The Party (either Buyer, on the one hand, or Parent on
behalf of Sellers, on the other hand) whose determination of the amount of the
adjusted Cash Balance was farthest from the final determination of the adjusted
Cash Balance by the Accounting Firm shall bear the fees and expenses of the
Accounting Firm plus any out-of-pocket expenses (including attorneys’ and
accountants’ fees) of the Party whose determination of the adjusted Cash Balance
was closest to the final determination by the Accounting Firm. If the
determination of the adjusted Cash Balance by the Accounting Firm is equidistant
between the determinations of the parties, the fees of the Accounting Firm shall
be borne equally by Buyer, on the one hand, and Sellers, on the other hand, and
each of Buyer, on the one hand, and Sellers, on the other hand, shall bear the
cost of their own out-of-pocket expenses.

 

(d)       Any Shortfall shall be paid to Buyer and satisfied solely from the
Adjustment Escrow Amount and the remainder, if any, of the Adjustment Escrow
Amount shall be promptly paid over to Sellers by wire transfer of immediately
available funds into the account(s) designated in writing by Parent (and Sellers
and Buyer shall instruct the Escrow Agent accordingly promptly upon final
resolution of such Shortfall in accordance with Section 2.4(c)). Sellers shall
have no liability for a Shortfall in excess of the Adjustment Escrow Amount. Any
Surplus shall be satisfied by payment of the amount of the Surplus to Sellers
from Buyer via wire transfer of immediately available funds to the account(s)
designated in writing by Parent (and, in such case, the full Adjustment Escrow
Amount shall be promptly paid over to Sellers by wire transfer of immediately
available funds into the account(s) designated in writing by Parent, and Sellers
and Buyer shall instruct the Escrow Agent accordingly promptly upon final
resolution of such Surplus in accordance with Section 2.4(c)). Buyer shall have
no liability for a Surplus in excess of the Adjustment Escrow Amount.

 

 12 

 

 

(e)       The Base Purchase Price less the Shortfall, if any, or plus the
Surplus, if any, shall be the “Purchase Price”.

 

2.5          Allocation of Purchase Price. Within one hundred and twenty (120)
calendar days after the Closing Date, Parent shall deliver to Buyer an
allocation of the Purchase Price (and all other capitalized costs) as determined
for tax purposes, among the Purchased Assets. Such allocation shall be made
pursuant to Code Section 1060 and the Treasury Regulations thereunder (and any
similar provision of state, local or non-U.S. Law, as appropriate). If, within
thirty (30) calendar days of Buyer’s receipt of Parent’s proposed allocation,
Buyer does not deliver to Parent written notice (a “Buyer Allocation Objection
Notice”) of any objections that it has to such allocation, Parent’s proposed
allocation shall be final. If Buyer timely delivers to Parent a Buyer Allocation
Objection Notice, then Parent and Buyer shall work together in good faith to
resolve the disputed items. If Parent and Buyer are unable to resolve all of the
disputed items within thirty (30) calendar days of Parent’s receipt of the Buyer
Allocation Objection Notice (or such later date as Parent and Buyer may agree),
then Parent and Buyer shall refer the disputed items for resolution, consistent
with the side constraints set forth in Exhibit A, to the Accounting Firm in
accordance with procedures analogous to those set forth in Section 2.4(c).
Notwithstanding anything in this Section 2.5 to the contrary, in no event will
the allocation finalized pursuant to this Section 2.5 include any allocations
contrary to the restrictions set forth in Exhibit A. Sellers and Buyer agree
that the allocation determined under this Section 2.5 shall be binding on all
Parties, and that Sellers and Buyer will (and Buyer will cause the Acquired
Subsidiaries to) report, act and file Tax Returns (including, but not limited to
IRS Form 8594) in all respects and for all purposes consistent with such
allocation, except to the extent inconsistent with applicable Law.  Neither
Sellers nor Buyer shall (and Buyer will not permit an Acquired Subsidiary to)
take any position (whether in audits, tax returns or otherwise) that is
inconsistent with such allocation unless required to do so by applicable Law.

 

2.6          Closing Date. Upon the terms and conditions set forth in this
Agreement, the consummation of the transactions contemplated by this Agreement
(the “Closing”) shall take place at the offices of Lowenstein Sandler LLP, 1251
Avenue of the Americas, New York, New York 10020, at 10:00 a.m. local time on
the third Business Day following the day on which the last of the conditions set
forth in ARTICLE VI are satisfied or waived (other than those conditions that by
their nature are to be satisfied at the Closing, but subject to the satisfaction
or waiver of such conditions in accordance with this Agreement), or at such
other place or time as Buyer and Sellers may agree in writing; provided,
however, that without the prior written consent of Parent, the Closing shall not
occur earlier than the earlier of (i) the date of the consummation of the sale
of the Pharma Business pursuant to Section 363 of the Bankruptcy Code (provided,
however, that Sellers shall keep Buyer reasonably informed of the progress of
such sale and the anticipated consummation date thereof) and (ii) July 1, 2019;
provided, further, however, that if all of the conditions set forth in ARTICLE
VI are satisfied or waived (other than those conditions that by their nature are
to be satisfied at the Closing, but subject to the satisfaction or waiver of
such conditions in accordance with this Agreement) on or before 5:00 p.m.
Eastern Time on April 28, 2019, the Closing shall take place no later than April
29, 2019. Notwithstanding anything to the contrary herein, the Closing shall not
take place prior to April 26, 2019 without the consent of Buyer (in its sole
discretion). The date on which the Closing actually occurs is referred to as the
“Closing Date.”

 

2.7          Deliveries of Buyer. At or prior to the Closing, Buyer shall:

 

(a)       satisfy the Base Purchase Price in accordance with Section 2.2; and

 

(b)       deliver to Sellers:

 

 13 

 

 

(i)       the Assignment and Assumption Agreement, the Assignment and Assumption
of Leases, the Escrow Agreement and each other Ancillary Document to which the
Buyer is a party, each dated as of the Closing Date and duly executed by Buyer
(and in the case of the Escrow Agreement, duly executed by the Escrow Agent);

 

(ii)      a copy of resolutions of the governing body of the Buyer approving and
authorizing the Asset Purchase;

 

(iii)     the officer’s certificate required to be delivered pursuant to
Section 6.2(c); and

 

(iv)     such resale certificates for sales tax purposes as are reasonably
requested by a Seller.

 

2.8          Deliveries of Sellers. At or prior to the Closing, Sellers shall
deliver to Buyer the following:

 

(a)       the Bill of Sale, the Assignment and Assumption Agreement, the Escrow
Agreement and each other Ancillary Document to which a Seller is a party, dated
as of the Closing Date and duly executed by such Seller (and in the case of the
Escrow Agreement, duly executed by the Escrow Agent);

 

(b)       instruments of assignment of the Registered Intellectual Property (the
“Assignment of Intellectual Property”) that are owned by a Seller and included
in the Purchased Assets, if any, dated as of the Closing Date, duly executed by
such Seller, in form for recordation with the appropriate Governmental Entities,
in form reasonably acceptable to the Parties;

 

(c)       a copy of the final Sale Order;

 

(d)       the officer’s certificates required to be delivered pursuant to
Section 6.3(c);

 

(e)       (i) with respect to each Seller that is not a disregarded entity (as
defined for purposes of Treasury Regulations Section 1.1445-2(b)(2)(iii)), a
statement from such Seller, dated as of the Closing Date prepared in accordance
with Treasury Regulations Section 1.1445-2(b)(2) and Section 1446(f) of the Code
certifying such Seller’s non-foreign status for purposes of Section 1445 and
1446(f)(2) of the Code; and (ii) with respect to each Seller that is a
disregarded entity (as defined for purposes of Treasury Regulations Section
1.1445-2(b)(2)(iii)), a statement from the Person treated for federal income Tax
purposes as the owner of such Seller, dated as of the Closing Date and in form
reasonably satisfactory to Buyer, certifying (A) such Seller’s status as a
disregarded entity (as defined for purposes of Treasury Regulations Section
1.1445-2(b)(2)(iii)) whose separate existence from such Person is disregarded
and (B) such Person’s non-foreign status for purposes of Section 1445 and
1446(f)(2) of the Code;

 

(f)       instruments of assignment and assumption of the Assumed Real Property
Lease(s), dated as of the Closing Date, in form reasonably acceptable to the
Parties (the “Assignment and Assumption of Leases”), duly executed by the
applicable Seller, in form for recordation with the appropriate public land
records, if necessary, and any other related documentation or instruments
necessary for the conveyance of any Assumed Real Property Lease;

 

(g)       a copy of resolutions of the governing body of each Seller approving
and authorizing the Asset Purchase;

 

 14 

 

 

(h)       share certificates (or an affidavit of lost or stolen share
certificate, in form and substance acceptable to the Parties), with stock powers
duly endorsed in blank, or other evidence of Sellers’ or each Purchased
Subsidiaries’ ownership interest, if any, in each of the Acquired Subsidiaries
and such other documents, if any, that may be required to effectively deliver
title thereto under applicable non-U.S. Law as set forth on Schedule 2.8(h);

 

(i)       such other bills of sale, deeds, endorsements, assignments and
instruments of conveyance and transfer listed on Schedule 2.8(i), dated as of
the Closing Date and in form reasonably satisfactory to Buyer, as Buyer may
reasonably request to vest in Buyer all the right, title and interest of Sellers
in, to or under any or all of the Purchased Assets; and

 

(j)       one or more powers of attorney or other authorization letters, notices
or filings as required by applicable Law in form and substance reasonably
satisfactory to Sellers and Buyer (the “Powers of Attorney”) reasonably
necessary to permit Buyer and/or its Subsidiaries to utilize Sellers’ DEA, FDA,
EPA, FIFRA and state controlled substance registrations, licenses and/or permits
and any other registrations, licenses and/or permits issued by a Governmental
Entity that the Sellers and Buyer reasonably agree require Powers of Attorney
(collectively, the “Registrations”) after the Closing until the Buyer or one of
its Subsidiaries, as applicable, has obtained its own Registrations. The Powers
of Attorney shall authorize the appropriate personnel of Buyer or its
Subsidiaries to take reasonable actions under the Sellers’ Registrations
including, but not limited to, as applicable, (a) placing and filling orders for
controlled substances as well as importing and exporting controlled substances
and DEA listed chemicals in accordance with applicable regulations and
recordkeeping and reporting requirements, (b) producing and distributing
pesticide products (including all products licensed by Sellers for sale as
supplemental distributor products) under the existing state and federal
pesticide registrations at the contract production facilities used by Sellers,
using existing commercial labels, until the EPA or other applicable Governmental
Entity approves the transfers of the Registrations to Buyer or Buyer’s
applicable Subsidiary and (c) maintaining and renewing the existing
Registrations. The Powers of Attorney shall not be revocable until Buyer or an
applicable Subsidiary of Buyer has obtained its own Registrations (“Buyer
Registrations”) provided that Buyer is in compliance with the terms and
conditions of the Powers of Attorney during the term of the Powers of Attorney
and has used its commercially reasonable efforts to obtain such Buyer
Registrations as promptly as possible at Buyer’s expense.

 

2.9          Withholding Rights. Buyer, the Escrow Agent, the Acquired
Subsidiaries and any agent or affiliate thereof shall be entitled to deduct and
withhold with respect to any payments made pursuant to this Agreement or any
Ancillary Document such amounts that are required to be deducted and withheld
with respect to any such payments under the Code (or any other provision of
applicable Law). To the extent that such amounts are withheld and remitted to
the appropriate Taxing Authority, such withheld amounts shall be treated for all
purposes of this Agreement or the applicable Ancillary Document as having been
paid to such Persons in respect of which such deduction and withholding was
made. Notwithstanding anything to the contrary, any compensatory amounts payable
to an employee pursuant to or as contemplated by this Agreement or any Ancillary
Document shall be remitted to the applicable payor for payment to the applicable
Person through regular payroll procedures, as applicable. Prior to the
withholding, Buyer shall (a) notify the Sellers of any anticipated withholding,
(b) consult with the Sellers in good faith to determine whether such deduction
and withholding is required under applicable Tax law, and (c) cooperate with the
Sellers in good faith to minimize the amount of any applicable withholding.

 

 15 

 

 

2.10        Transfer of Aceto Shanghai Interests. Notwithstanding anything to
the contrary herein:

 

(a)       If the PRC Transfer Approvals have not been obtained (including
acceptance of any filings, as applicable) prior to Closing, then from and after
the Closing, and until such time as all PRC Transfer Approvals have been
obtained (or filings accepted, as applicable) (the “Deferral Period”), except
with the prior written consent of Buyer, the Sellers shall use commercially
reasonable efforts, to the extent Sellers have the corporate power to do so,
with all necessary personnel and administrative support supplied by Buyer, in
each case, at no cost to Sellers, to (i) cause Aceto Shanghai (including all
Cash generated with respect thereto) to be managed and operated by Sellers and
their Affiliates (with Buyer’s personnel and administrative support) for Buyer’s
(or its designated Affiliate’s) sole benefit or detriment, including, for the
avoidance of doubt, all items of income, expense, gain and loss, with respect to
the Deferral Period, (ii) not permit Aceto Shanghai to make any distribution or
payment to any Seller, any affiliate of any Seller, or any third party other
than a customer, supplier or employee (i.e., in respect of payroll) of Aceto
Shanghai or Sellers, or others doing business with Aceto Shanghai or Sellers, in
each case, in the Ordinary Course of Business, and (iii) not transfer or take
any action to transfer or purport to transfer the equity of Aceto Shanghai to
any Person other than Buyer or its designated Affiliate. During the Deferral
Period, Sellers will, to the extent Sellers have the corporate power to do so
(with Buyer’s personnel and administrative support), cause Aceto Shanghai to be
operated in the Ordinary Course of Business or, unless prohibited by applicable
Law, otherwise in such manner as Buyer shall reasonably request in writing, and
Seller’s pre-Closing obligations pursuant to Section 5.1 will, to the extent
Sellers have the corporate power to do so, with the personnel and administrative
support supplied by Buyer, in each case, at no cost to Sellers, continue in
force with respect to Aceto Shanghai, until all PRC Transfer Approvals have been
obtained (or filings accepted, as applicable).

 

(b)       If the PRC Transfer Approvals have not been obtained (including
acceptance of any filings, as applicable) on or prior to the first anniversary
of the Closing Date, then Buyer and Sellers shall enter into one or more
separate asset purchase agreements (the “Shanghai APA”) with respect to the
assets and Liabilities of Aceto Shanghai (the “Shanghai Assets”), pursuant to
which, among other things, to the extent permitted under applicable Law, Aceto
Shanghai shall assign to Buyer (or its designated Affiliate) for no additional
consideration other than the Tax Adjustment (as defined below) all assets, and
Buyer shall assume all Liabilities, of Aceto Shanghai, including all Accounts
Receivable, Accounts Payable, inventory, Contracts, Owned Real Property, books
and records, Intellectual Property, equipment leases, rights, claims and causes
of action against third parties and all goodwill of and used by Aceto Shanghai
and all Permits required by the applicable Governmental Entity to operate the
business of Aceto Shanghai on terms and conditions reasonably satisfactory to
Buyer and Sellers. If any Shanghai Assets cannot be so transferred, then Sellers
will cooperate with Buyer to establish an agency, services or similar
arrangement (including by means of any subcontracting, sublicensing or
subleasing arrangement) reasonably satisfactory to Sellers and Buyer intended to
provide Buyer, to the fullest extent practicable, the claims, rights, benefits,
costs and Liabilities of those assets that cannot be transferred.

 

(c)       If the Shanghai Assets are sold pursuant to Section 2.10(b), then the
amount of the Purchase Price allocated to the equity of Aceto Shanghai (as
adjusted for the Tax Adjustment (as defined below)) shall be instead allocated
among the Shanghai Assets in accordance with this Section 2.10(c). Within
forty-five (45) calendar days after the first anniversary of the Closing Date,
Buyer shall deliver to Parent an allocation of the Purchase Price allocated to
the equity of Aceto Shanghai (as adjusted for the Tax Adjustment (as defined
below) and all other capitalized costs) as determined for tax purposes, among
the Shanghai Assets. Such allocation shall be made pursuant to Code Section 1060
and the Treasury Regulations thereunder (and any similar provision of state,
local or non-U.S. Law, as appropriate). If, within ten (10) calendar days of
Parent’s receipt of Buyer’s proposed allocation, Parent does not deliver to
Buyer written notice (a “Parent Shanghai Allocation Objection Notice”) of any
objections that it has to such allocation, Buyer’s proposed allocation shall be
final. If Parent timely delivers to Buyer a Parent Shanghai Allocation Objection
Notice, then Buyer shall consider in good faith Parent’s comments. Sellers and
Buyer agree that the allocation determined under this Section 2.10(c) shall be
binding on all Parties, and that Sellers and Buyer will (and Buyer will cause
the Acquired Subsidiaries to and Sellers will cause Aceto Shanghai to) report,
act and file Tax Returns (including, but not limited to IRS Form 8594) in all
respects and for all purposes consistent with such allocation, except to the
extent inconsistent with applicable Law.  Neither Sellers nor Buyer shall (and
Buyer will not permit an Acquired Subsidiary to and Sellers will not permit
Aceto Shanghai to) take any position (whether in audits, tax returns or
otherwise) that is inconsistent with such allocation unless required to do so by
applicable Law.

 

 16 

 

 

(d)       The Buyer agrees to indemnify Sellers and Aceto Shanghai for any
additional Tax owed by Sellers or Aceto Shanghai (including Tax owed by Sellers
or Aceto Shanghai due to this indemnification payment) resulting from (x) any
transaction engaged in by Sellers or Aceto Shanghai pursuant to Sections
2.10(b), (c) and (d) and (y) the operations of Aceto Shanghai from the Closing
Date through the last of the Shanghai Asset Closing Dates. Buyer shall pay to
Parent, in cash, the amount of additional consideration necessary to cause
Sellers’ after-Tax net proceeds from the sale of the Shanghai Assets on the
Shanghai Asset Closing Dates pursuant to Sections 2.10(b), (c) and (d), taking
into account any Taxes attributable to payments pursuant to this Section 2.10
and Taxes resulting from the operations of Aceto Shanghai from the Closing Date
through the last of the Shanghai Asset Closing Dates, to be equal to the
after-Tax net proceeds that Sellers would have received from the sale of Aceto
Shanghai stock on the Closing Date, taking into account all appropriate federal,
state, local and non-U.S. Tax implications (the “Tax Adjustment”). Parent shall
provide Buyer with a calculation of the amount of the Tax Adjustment within
ninety (90) days after the last of the Shanghai Asset Closing Dates. If, within
thirty (30) calendar days of Buyer’s receipt of Parent’s proposed calculation
computing the amount of the Tax Adjustment, Buyer does not deliver to Parent
written notice (a “Buyer Tax Adjustment Objection Notice”) of any objections
that it has to such schedule, Parent’s proposed calculation shall be final. If
Buyer timely delivers to Parent a Buyer Tax Adjustment Objection Notice, then
Parent and Buyer shall work together in good faith to resolve the disputed
items. If Parent and Buyer are unable to resolve all of the disputed items
within thirty (30) calendar days of Parent’s receipt of the Buyer Tax Adjustment
Objection Notice (or such later date as Parent and Buyer may agree), then Parent
and Buyer shall refer the disputed items for resolution to the Accounting Firm
in accordance with procedures analogous to those set forth in Section 2.4(c).
Sellers and Buyer agree that the amount of the Tax Adjustment determined under
this Section 2.10 shall be binding on all Parties.  The amount of the Tax
Adjustment shall be paid to Parent within ten (10) days after the finalization
by the Parties of the amount of the Tax Adjustment.

 

(e)       Except as set forth in this Section 2.10, the equity interests of
Aceto Shanghai shall be deemed transferred to Buyer or its designee as of the
Closing for purposes of this Agreement.

 

ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLERS

 

As an inducement to Buyer to enter into this Agreement and to consummate the
transactions contemplated hereby, except (a) as disclosed in any form, document
or report publicly filed with or publicly furnished to the U.S. Securities and
Exchange Commission (the “SEC”) by Parent or any of its Subsidiaries from and
after July 1, 2015 and prior to the Agreement Date (excluding any disclosures
set forth in any “risk factors,” “forward-looking statements” or “market risk”
sections to the extent they are cautionary, predictive or forward-looking in
nature) (collectively, the “Parent SEC Disclosures”), (b) as disclosed in any
Bankruptcy Court filings by Sellers or any of their respective Subsidiaries made
prior to the Agreement Date (the “Bankruptcy Court Filings”), or (c) as
disclosed in the disclosure schedule delivered by Sellers to Buyer concurrently
with the execution of this Agreement (the “Sellers Disclosure Schedule”), each
Seller, jointly and severally, represents and warrants to Buyer as follows:

 

3.1          Organization. Such Seller is a legal entity duly incorporated,
validly existing and in good standing under the laws of the State of New York.
Subject to the limitations imposed on such Seller as a result of having filed a
petition for relief under the Bankruptcy Code, such Seller has full power and
authority to own, lease and operate its properties and assets and to carry on
its business as presently conducted in the Acquired Business, except where the
failure to have such power or authority would not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.

 

 17 

 

 

3.2          Acquired Subsidiaries.

 

(a)       Section 3.2 of the Sellers Disclosure Schedule sets forth the name of
each Acquired Subsidiary, and, with respect to each such entity, the
jurisdiction in which it is incorporated or organized, the jurisdictions, if
any, in which it is qualified to do business, the names of all shareholders or
other equity owners and the number of shares of stock owned by each such
shareholder or the amount of equity owned by each such equity owner. Each
Acquired Subsidiary is a legal entity duly organized, validly existing and
(where such concept is recognized) in good standing under the Laws of its
respective jurisdiction of organization and has all requisite corporate or
similar power and authority to own, lease and operate its properties and assets
and to carry on its business as presently conducted. Each Acquired Subsidiary
(other than the Joint Venture) is duly qualified or licensed, and has all
necessary governmental approvals, to do business and is in good standing (where
such concept is recognized) in each jurisdiction in which the property owned,
leased or operated by it or the nature of the business conducted by it makes
such approvals, qualification or licensing necessary, except where the failure
to be so duly approved, qualified or licensed and in good standing (where such
concept is recognized) would not reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect.

 

(b)       The outstanding shares of capital stock of each Acquired Subsidiary
are duly authorized, validly issued, fully paid and non-assessable and free of
pre-emptive rights, and all such shares or other equity interests are owned by
the applicable holder free and clear of any and all Liens (other than Permitted
Liens and Liens created by Buyer). Sellers own, directly or indirectly, all of
the issued and outstanding shares of capital stock or other equity interests of
the Acquired Subsidiaries (other than the Joint Venture). There is no existing
option, warrant, call, right or Contract to which any Acquired Subsidiary (other
than the Joint Venture) is a party requiring, and there are no convertible
securities of any Acquired Subsidiary (other than the Joint Venture) outstanding
which upon conversion would require, the issuance of any shares of capital stock
or other equity interests of any Acquired Subsidiary (other than the Joint
Venture) or other securities convertible into shares of capital stock or other
equity interests of any Acquired Subsidiary (other than the Joint Venture).

 

3.3          Corporate Authority Relative to this Agreement; Consents and
Approvals; No Violation.

 

(a)       Such Seller has the full corporate power and authority to execute and
deliver this Agreement and the Ancillary Documents to which it is a party and,
subject to the entry of the Sale Order and such other authorization as is
required by the Bankruptcy Code, perform its obligations under and consummate
the transactions contemplated by this Agreement, including the Asset Purchase,
and the Ancillary Documents to which it is a party. The execution, delivery and
performance by such Seller of this Agreement and the Ancillary Documents to
which it is a party and the consummation of the transactions contemplated hereby
and thereby, including the Asset Purchase, have been duly and validly authorized
by such Seller’s board of directors (or a committee thereof) and no other
actions on the part of such Seller, subject to the entry of the Sale Order and
such other authorization as is required by the Bankruptcy Code, are necessary to
authorize the execution and delivery by such Seller of this Agreement and the
Ancillary Documents to which it is a party or the consummation of the
transactions contemplated hereby or thereby, including the Asset Purchase. This
Agreement has been, and the Ancillary Documents to which it is a party have been
(or will be at Closing) duly and validly executed and delivered by such Seller
and, assuming this Agreement constitutes the legal, valid and binding agreement
of Buyer, this Agreement and the Ancillary Documents to which it is a party
constitute (or upon execution at Closing will constitute, as applicable), the
entry of the Sale Order and such other authorization as is required by the
Bankruptcy Code, the legal, valid and binding agreements of such Seller,
enforceable against such Seller in accordance with their terms, except as and to
the extent that such validity and enforceability may be limited by equitable
principles of general applicability (whether considered in a proceeding at law
or in equity) (the “Enforceability Exceptions”).

 

 18 

 

 

(b)       Other than in connection with or in compliance with (i) the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules
and regulations promulgated thereunder (the “HSR Act”), (ii) the approvals set
forth in Section 3.3(b) of the Sellers Disclosure Schedule (covering the
applicable Laws or other legal restraints of foreign countries designed to
govern competition or trade regulation or to prohibit, restrict or regulate
actions with the purpose or effect of monopolization or restraint of trade
(collectively, “Antitrust Laws”)) and (iii) the Sale Order (clauses (i) through
(iii), collectively, the “Transaction Approvals”), and subject to the accuracy
of Buyer’s representations and warranties set forth in Section 4.2(b), no
authorization, consent, order, license, permit or approval of, or registration,
declaration, notice or filing with, any Governmental Entity is required to be
made or obtained under applicable Law for the consummation by such Seller of the
transactions contemplated hereby, except for such authorizations, consents,
orders, licenses, permits, approvals, registrations, declarations, notices and
filings that are not required to be made or obtained prior to the consummation
of such transactions or that the failure to make or obtain would not, in the
case of this Section 3.3(b), reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect.

 

(c)       Except as set forth in Section 3.3(c) of the Sellers Disclosure
Schedule (the “Consents”), the execution and delivery by such Seller of this
Agreement does not, and (assuming the Transaction Approvals are obtained and
after giving effect to the Sale Order and such other authorization as is
required by the Bankruptcy Code) the consummation of the transactions
contemplated hereby and compliance with the provisions hereof will not, (i)
require any consent or approval under, violate, conflict with, result in any
breach of or any loss of any benefit under, constitute an impermissible change
of control or default under, or result in termination or give to others any
right of termination, vesting, amendment, acceleration or cancellation of, or
result in the creation of a Lien (other than Permitted Liens) upon any of the
respective properties or assets of such Seller or any of the Acquired
Subsidiaries pursuant to, any Contract to which such Seller or any of the
Acquired Subsidiaries is a party or by which they or any of their respective
properties or assets are bound, except as would not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect, (ii) conflict
with or result in any violation of any provision of the Organizational Documents
of such Seller or (iii) conflict with or violate any applicable Laws except as
would not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.

 

3.4          Financial Statements. Sellers have made available to Buyer copies
of the audited balance sheet of the Acquired Business as of June 30, 2018 (the
“Most Recent Balance Sheet”), the related audited income statement and audited
statement of cash flows for the twelve month period ended June 30, 2018,
together with the accompanying notes thereto (collectively, the “Financial
Statements”). Each of the Financial Statements has been prepared in all material
respects in conformity with U.S. generally accepted accounting principles
(“GAAP”) (except as permitted by the SEC in connection with financial statements
prepared on a carve-out basis) applied on a consistent basis during the periods
involved (except as may be indicated therein or in the notes thereto), and
presents fairly in all material respects the consolidated financial position,
results of operations and cash flows of the Acquired Business as at the dates
and for the periods indicated therein.

 

3.5          Compliance with Law; Permits.

 

(a)       Except as would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect, such Seller and the Acquired
Subsidiaries (other than the Joint Venture) are, and since July 1, 2016 have
been, in compliance with all applicable federal, state, local and foreign laws,
statutes, ordinances, rules, regulations, judgments, Orders, injunctions,
decrees or agency requirements of Governmental Entities (collectively, “Laws”
and each, a “Law”) applicable to the Purchased Assets, the Acquired Subsidiaries
or the operation of the Acquired Business. Except as would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect,
since July 1, 2016, Sellers and the Acquired Subsidiaries (other than the Joint
Venture) have not received any written notice or, to Sellers’ knowledge, other
communication from any Governmental Entity regarding any actual or alleged
failure to comply with any Law applicable to the Purchased Assets, any Acquired
Subsidiary or the operation of the Acquired Business.

 

 19 

 

 

(b)       Except as would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect and subject to the limitations imposed
on Sellers as a result of having filed a petition for relief under the
Bankruptcy Code, Sellers and the Acquired Subsidiaries (other than the Joint
Venture) hold all authorizations, licenses, permits, certificates, variances,
exemptions, approvals, orders, registrations and clearances of any Governmental
Entity necessary for Sellers and the Acquired Subsidiaries (other than the Joint
Venture) to own, lease and operate the Purchased Assets, and to carry on and
operate the Acquired Business as currently conducted.

 

(c)       Except as would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect, neither Sellers, nor the Acquired
Subsidiaries (other than the Joint Venture), or, to Sellers’ knowledge, any of
their respective directors or officers, in each case, acting on behalf of
Sellers or the Acquired Subsidiaries (other than the Joint Venture), has in the
past three years, directly or indirectly in respect of the Acquired Business,
(i) used any funds of the Acquired Business for unlawful contributions, unlawful
gifts, unlawful entertainment or other unlawful expenses relating to political
activity; (ii) made any unlawful payment to foreign or domestic governmental
officials or employees or to foreign or domestic political parties or campaigns
from funds of the Acquired Business; or (iii) violated or is in violation of
applicable Bribery Legislation of any jurisdiction in which the Acquired
Business operates.

 

3.6          Environmental Matters. Except as would not reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect, (a) Parent
(solely in respect of the Acquired Business), NY Agri and the Acquired
Subsidiaries (other than the Joint Venture) are, to Sellers’ knowledge, in
compliance with applicable Environmental Laws, and each has, or has timely
applied for, all Environmental Permits necessary for the conduct and operation
of the Acquired Business as presently conducted, (b) since July 1, 2016, neither
Sellers, nor the Acquired Subsidiaries (other than the Joint Venture), have
received any written notice, demand, letter or claim alleging that Parent
(solely in respect of the Acquired Business), NY Agri or such Acquired
Subsidiary (other than the Joint Venture) is in violation of, or liable under,
any Environmental Law and (c) neither any Sellers, nor the Acquired Subsidiaries
(other than the Joint Venture), are subject to any Order in respect of the
Acquired Business relating to compliance with Environmental Laws, Environmental
Permits or the investigation, sampling, monitoring, treatment, remediation,
removal or cleanup of Regulated Substances. Notwithstanding anything herein to
the contrary, the representations and warranties contained in this Section 3.6
(together with the representations and warranties in Section 3.5) are the sole
and exclusive representations of Sellers with respect to Environmental Laws,
Environmental Permits, Regulated Substances or any other matter related to the
environment or the protection of human health and worker safety.

 

3.7          Employee Benefit Plans.

 

(a)       Section 3.7(a) of the Sellers Disclosure Schedule sets forth a correct
and complete list, as of the Agreement Date, of each Seller Benefit Plan. With
respect to each Assumed Plan, to the extent applicable, correct and complete
copies of the following have been delivered or made available to Buyer by
Sellers: (i) the most recent plan document (which, for the avoidance of doubt,
with respect to any Assumed Plan for which a form agreement is used, shall
consist of a copy of such form); (ii) the most recent related trust document;
(iii) the most recent annual report (Form 5500) filed with the Internal Revenue
Service (the “IRS”); (iv) the most recent determination, opinion or advisory
letter from the IRS for any Assumed Plan that is intended to qualify under
Section 401(a) of the Code; (v) the most recent summary plan description and
(vi) with respect to the Aceto Corporation 2013 Senior Executive Retirement Plan
and the Aceto Corporation Supplemental Executive Deferred Compensation Plan (the
“Seller Deferred Compensation Plans”), an accurate accounting as of March 22,
2019 of the account balances of each employee as of the Agreement Date, and
copies of all written elections made by such employees under the Seller Deferred
Compensation Plans.

 

 20 

 

 

(b)       Except (i) as set forth on Section 3.7(b) of the Sellers Disclosure
Schedule or (ii) as would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect, (x) each U.S. Seller Benefit Plan has
been established, operated and administered in accordance with its terms and the
requirements of all applicable Laws, including ERISA and the Code, and (y) there
are no pending or, to Sellers’ knowledge, threatened in writing claims (other
than claims for benefits in the Ordinary Course of Business) with respect to any
Seller Benefit Plan.

 

(c)       Except as set forth on Section 3.7(c) of the Sellers Disclosure
Schedule, none of the Sellers, the Acquired Subsidiaries (other than the Joint
Venture) or any of their respective ERISA Affiliates, sponsor, maintain, or
contribute to, any employee benefit plan that is (i) subject to Title IV of
ERISA or Section 412 of the Code, (ii) a “multiple employer plan” within the
meaning of Sections 4063 or 4064 of ERISA, or (iii) a “multiemployer plan” as
defined in Section 4001(a)(3) of ERISA (a “Multiemployer Plan”).

 

(d)       Except as would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect, each Non-U.S. Seller Benefit Plan (i)
if intended to qualify for special tax treatment, meets all the requirements for
such treatment, (ii) if required to be funded, book-reserved or secured by an
insurance policy, is funded, book-reserved, or secured by an insurance policy,
as applicable, based on reasonable actuarial assumptions in accordance with
applicable accounting principles, and (iii) has been maintained in compliance
with all applicable Laws.

 

(e)       Except (i) as set forth on Section 3.7(e) of the Sellers Disclosure
Schedule, or (ii) as would not reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect, neither the execution of this
Agreement nor the completion of the transactions contemplated by this Agreement
(either alone or in conjunction with any other event) will result in (x) any
compensation payment becoming due to any employee of Parent (who is or was
primarily employed in respect of the Acquired Business), NY Agri or of the
Acquired Subsidiaries (other than the Joint Venture), (y) the acceleration of
vesting or payment to any employee of Parent (who is or was primarily employed
in respect of the Acquired Business), NY Agri or of the Acquired Subsidiaries
(other than the Joint Venture), or (z) any increase to the compensation or
benefits otherwise payable under any Seller Benefit Plan.

 

3.8          Litigation. As of the Agreement Date, neither such Seller, nor any
Acquired Subsidiary (other than the Joint Venture), is a party to any pending
or, to such Seller’s knowledge, threatened Proceeding relating to the Acquired
Business or the Purchased Assets that would reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect. As of the Agreement
Date, neither Sellers, nor the Acquired Subsidiaries (other than the Joint
Venture), are subject to any outstanding Order relating to the Acquired Business
or the Purchased Assets that would reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect.

 

 21 

 

 

3.9          Tax Matters. For purposes of this Section 3.9, the Joint Venture
shall not be treated as either a Purchased Subsidiary or Acquired Subsidiary.
Except as set forth on Section 3.9 of the Sellers Disclosure Schedule:

 

(a)       Parent (solely in respect of the Acquired Business), NY Agri and the
Acquired Subsidiaries have timely filed (taking into account any extension of
time within which to file) all income and other material Tax Returns required to
be filed by any of them and all such filed Tax Returns are complete and accurate
in all material respects; (ii) Parent (solely in respect of the Acquired
Business), NY Agri and the Acquired Subsidiaries have paid all income and other
material Taxes that are required to be paid by any of them, except, in each case
of clauses (i) and (ii), with respect to matters contested in good faith or for
which adequate reserves have been established in the Most Recent Balance Sheet,
in accordance with GAAP; and (iii) there are not pending, or to Sellers’
knowledge, threatened in writing, audits, examinations, investigations or other
administrative or judicial Proceedings in respect of material Taxes of Parent
(solely in respect of the Acquired Business), NY Agri or the Acquired
Subsidiaries, in each case, other than in respect of matters for which adequate
reserves have been established in the Most Recent Balance Sheet, in accordance
with GAAP.

 

(b)       There are no Liens for Taxes on any of the Purchased Assets or the
assets of the Acquired Subsidiaries other than Permitted Liens.

 

(c)       Sellers have not participated in any “listed transaction” within the
meaning of Treasury Regulation Section 1.6011-4(b)(2).

 

(d)       No Acquired Subsidiary (and no Seller in respect of the Acquired
Business) has waived any statute of limitations in respect of Taxes or agreed to
any extension of time with respect to a Tax assessment or deficiency which
waiver or extension remains outstanding.

 

(e)       The Acquired Subsidiaries that are organized outside the United States
are not subject to income Tax in any country other than their respective
countries of incorporation or formation. Sellers expect to recognize a de
minimis amount of Tax as a result of the inclusion of Subpart F income (as
defined for purposes of Section 951(a)(1)(A) of the Code) and global intangible
low-taxed income (as defined in Section 951A of the Code) through the Closing
Date (exclusive of any election under Section 338(g) of the Code), determined as
though the taxable year of the Acquired Subsidiaries ended on the Closing Date
and calculated taking into account foreign Taxes paid and creditable and the Tax
attributes of the Sellers, including the deduction available under Section 250
of the Code.

 

(f)       Section 3.9(f) of the Sellers Disclosure Schedule lists the U.S.
federal income tax classification of each of the Acquired Subsidiaries and all
entity classification elections (and related effective dates) under Treasury
Regulations Section 301.7701-3 made with respect to any of the Acquired
Subsidiaries.

 

(g)      The Most Recent Balance Sheet reflects all Liabilities for unpaid Taxes
of the Acquired Subsidiaries for periods (or portions of periods) through the
date of the Most Recent Balance Sheet. Since the date of the Most Recent Balance
Sheet, none of Parent (solely in respect of the Acquired Business), NY Agri or
the Acquired Subsidiaries has incurred any liability for Taxes outside the
Ordinary Course of Business.

 

(h)       Notwithstanding anything herein to the contrary, the representations
and warranties in this Section 3.9 and, to the extent related to Taxes or Tax
matters, Section 3.7, are the sole and exclusive representations of such Seller
with respect to Taxes and Tax matters.

 

 22 

 

 

3.10        Employment and Labor Matters.

 

(a)       Neither Parent (solely in respect of the Acquired Business), NY Agri,
nor any Acquired Subsidiary (other than the Joint Venture) is a party to any
collective bargaining agreement, works council agreement, labor union contract,
or trade union agreement (each, a “Collective Bargaining Agreement”) covering
employees in the United States or any foreign jurisdiction.

 

(b)       Except as would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect, (i) there is not currently, nor has
there been in the past year, any strike, lockout, slowdown, or work stoppage
against Parent (solely in respect of the Acquired Business), NY Agri or the
Acquired Subsidiaries (other than the Joint Venture) pending or, to Sellers’
knowledge, threatened in writing; (ii) there is no pending charge or complaint
against Parent (solely in respect of the Acquired Business), NY Agri or the
Acquired Subsidiaries (other than the Joint Venture) by the National Labor
Relations Board or any comparable Governmental Entity; and (iii) Parent (solely
in respect of the Acquired Business), NY Agri and the Acquired Subsidiaries
(other than the Joint Venture) have complied with all Laws regarding employment
and employment practices (including anti-discrimination), terms and conditions
of employment and wages and hours (including classification of employees and
equitable pay practices) and other Laws in respect of any reduction in force
(including notice, information and consultation requirements), and no claims
against Parent (solely in respect of the Acquired Business), NY Agri or the
Acquired Subsidiaries (other than the Joint Venture) relating to non-compliance
with the foregoing are pending or, to Sellers’ knowledge, threatened in writing.

 

3.11        Real and Tangible Property. Such Seller or an Acquired Subsidiary
has good and valid title to the Owned Real Property set forth on Schedule 1.1(e)
(which constitutes all parcels of Owned Real Property) and to all of the
buildings, structures and other improvements thereon. Such Seller or an Acquired
Subsidiary has a good and valid leasehold interest in each of the Assumed Real
Property Leases listed on Schedule 1.1(d). A copy of each Assumed Real Property
Lease has been delivered to the Buyer, and no changes have been made to any
Assumed Real Property Lease since the date of delivery. Except as would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect, (a) neither Sellers, nor the Acquired Subsidiaries, have
received written notice of any default under any agreement evidencing any Lien
affecting the Owned Real Property set forth on Schedule 1.1(e) or any Assumed
Real Property Lease, which default continues on the Agreement Date, and (b) such
Seller or an Acquired Subsidiary has good and marketable title to, a good and
enforceable leasehold interest in or a valid and enforceable license to, all of
the tangible Purchased Assets, free and clear of all Liens (other than Permitted
Liens).

 

3.12        Intellectual Property.

 

(a)       The Patents, pending Patent applications, registered Marks, pending
applications for registration of Marks and registered Copyrights owned by
Sellers or the Acquired Subsidiaries (other than the Joint Venture) and used
primarily or held primarily for use in the Acquired Business are referred to
collectively as the “Registered Intellectual Property.”

 

(b)       Sellers and/or the Acquired Subsidiaries own all right, title, and
interest, free and clear of all Liens (except for Permitted Liens) to all
Registered Intellectual Property, except as would not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.

 

(c)       Except as would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect, (i) to Sellers’ knowledge, as of the
Agreement Date, the conduct of the Acquired Business does not infringe, violate
or constitute misappropriation of any Intellectual Property of any third Person;
(ii) to Sellers’ knowledge, as of the Agreement Date, no third Person is
infringing, violating, or misappropriating any Intellectual Property that is a
Purchased Asset; and (iii) as of the Agreement Date, there is no pending claim
asserted in writing against a Seller or any Acquired Subsidiary (other than the
Joint Venture) (including any “cease and desist” letters and invitations to
license) asserting that Sellers’ or any Acquired Subsidiary’s (other than the
Joint Venture’s) conduct of the Acquired Business has infringed, violated or
misappropriated, or is infringing, violating or misappropriating, any
Intellectual Property rights of any third Person.

 

 23 

 

 

(d)       Except as would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect, (i) Sellers and the Acquired
Subsidiaries (other than the Joint Venture) comply with their internal policies
and procedures and any other legal requirements, to the extent applicable,
relating to privacy, data protection, and the collection, retention, protection
and use of personal information collected, used, or held for use in the
operation of the Acquired Business and (ii) there are no claims pending or, to
Sellers’ knowledge, threatened against Sellers or any Acquired Subsidiary (other
than the Joint Venture) alleging a violation of any third Person’s privacy or
personal information or data rights, solely with respect to the operation of the
Acquired Business.

 

3.13         Material Contracts.

 

(a)       Section 3.13(a) of the Sellers Disclosure Schedule sets forth each
material Contract relating to the Purchased Assets and the Assumed Liabilities
(the “Material Contracts”).

 

(b)       Each Material Contract is a valid and binding obligation of a Seller
and, to Sellers’ knowledge, the other party or parties thereto in accordance
with its terms and conditions, except as and to the extent that such validity
and enforceability may be limited by (i) bankruptcy, insolvency, or other
similar laws affecting the enforcement of creditors’ rights generally, (ii) the
Enforceability Exceptions and (iii) the obligation to pay Cure Costs under
Section 365 of the Bankruptcy Code and Section 1.3.

 

(c)       With respect to any Material Contract, no event has occurred or not
occurred through such Seller’s action or inaction or, to Sellers’ knowledge,
prior to the Agreement Date, through the action or inaction of any third party
which, with notice or the lapse of time or both, would constitute a default or
result in the termination of or a right of termination or cancelation under any
Material Contract, accelerate the performance or obligations required thereby,
or result in the loss of any benefit under the terms of any Material Contract to
which such Seller is a party, except for the obligation to pay Cure Costs and/or
such events that would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect.

 

3.14         Certain Regulatory Matters.

 

(a)       The facilities of Sellers used in the operation of the Acquired
Business and the facilities of the Acquired Subsidiaries (other than the Joint
Venture) are in compliance with the FDCA, to the extent applicable, except as
would not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.

 

(b)       Except as set forth in Section 3.14(b) of the Sellers Disclosure
Schedule, as of the Agreement Date and for the three (3) years prior thereto,
none of the Products have been subject to any material recall or market
withdrawal and no material recall or market withdrawal is currently under
consideration by such Seller or the Acquired Subsidiaries (other than the Joint
Venture).

 

 24 

 

 

(c)       Since July 1, 2016, neither Parent (solely in respect of the Acquired
Business), NY Agri, nor any Acquired Subsidiaries (other than the Joint Venture)
have been the subject of any material enforcement action by the FDA (solely in
respect of the Acquired Business).

 

(d)       Notwithstanding anything herein to the contrary, the representations
and warranties in this Section 3.14 (together with the representations and
warranties in Section 3.5) are the sole and exclusive representations and
warranties of Sellers with respect to the regulatory matters expressly set forth
in this Section 3.14.

 

3.15         Finders or Brokers. Other than PJT Partners, Inc. and AP Services
LLC, no broker, finder or investment banker is entitled to any broker’s,
finder’s or financial advisor’s fee or commission in connection with the
transactions contemplated hereby based upon arrangements made by or on behalf of
Sellers, the Acquired Subsidiaries or a Seller’s board of directors.

 

3.16         Sufficiency of Assets. The Purchased Assets, together with the
assets of the Acquired Subsidiaries, (a) constitute all of the material assets
used by Sellers in the current operations of the Acquired Business and (b) are
sufficient for Buyer to operate the Acquired Business immediately following the
Closing in substantially the same manner as it is currently conducted.

 

3.17         Inventory. All Inventory, whether or not reflected in the Closing
Statement, consists of a quality and quantity usable and salable in the Ordinary
Course of Business, except for obsolete, damaged, defective or slow-moving items
that have been written off or written down to fair market value or for which
adequate reserves have been established.

 

3.18         No Other Representations or Warranties. THE PURCHASED ASSETS SOLD
PURSUANT TO THIS AGREEMENT ARE SOLD, CONVEYED, TRANSFERRED, AND ASSIGNED ON AN
“AS IS, WHERE IS” BASIS “WITH ALL FAULTS”, NOTWITHSTANDING ANYTHING SET FORTH
HEREIN (OTHER THAN AS EXPRESSLY SET FORTH IN THIS ARTICLE III, AS QUALIFIED BY
THE SELLERS DISCLOSURE SCHEDULE AND THE PARENT SEC DISCLOSURES AND BANKRUPTCY
COURT FILINGS) OR IN ANY ANCILLARY DOCUMENT (INCLUDING ANY CERTIFICATE DELIVERED
PURSUANT TO THIS AGREEMENT) TO THE CONTRARY. EXCEPT FOR THE REPRESENTATIONS AND
WARRANTIES EXPRESSLY SET FORTH IN THIS ARTICLE III (AS QUALIFIED BY THE SELLERS
DISCLOSURE SCHEDULE AND THE PARENT SEC DISCLOSURES AND BANKRUPTCY COURT FILINGS)
OR IN ANY ANCILLARY DOCUMENT (INCLUDING ANY CERTIFICATE DELIVERED PURSUANT TO
THIS AGREEMENT), NONE OF SELLERS, ANY OF THEIR AFFILIATES OR ANY OTHER PERSON ON
BEHALF OF SELLERS OR THEIR AFFILIATES MAKES ANY REPRESENTATIONS OR WARRANTIES
(INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE, WHICH WARRANTIES ARE ALSO HEREBY EXPRESSLY DISCLAIMED), TERMS,
CONDITIONS, UNDERSTANDINGS OR COLLATERAL ASSIGNMENTS OF ANY NATURE OR KIND,
EXPRESS OR IMPLIED, BY STATUTE OR OTHERWISE WITH RESPECT TO (A) THE PURCHASED
ASSETS, THE ACQUIRED BUSINESS, SELLERS, OR THEIR RESPECTIVE BUSINESSES, OR WITH
RESPECT TO ANY OTHER INFORMATION PROVIDED, OR MADE AVAILABLE, TO BUYER OR ITS
AFFILIATES OR THEIR OFFICERS, DIRECTORS, EMPLOYEES, ACCOUNTANTS, CONSULTANTS,
LEGAL COUNSEL, INVESTMENT BANKERS, ADVISORS, REPRESENTATIVES OR AUTHORIZED
AGENTS (COLLECTIVELY, “REPRESENTATIVES”) IN CONNECTION WITH THE TRANSACTIONS
CONTEMPLATED HEREBY, INCLUDING THE ACCURACY OR COMPLETENESS THEREOF OR (B) THE
CONDITION OF ANY REAL PROPERTY OWNED, LEASED OR USED IN THE ACQUIRED BUSINESS OR
WITH REGARD TO THE USE, EXISTENCE OR RELEASE OF ANY REGULATED SUBSTANCES AT, ON,
UNDER OR AROUND ANY REAL PROPERTY OWNED, LEASED OR USED IN THE ACQUIRED
BUSINESS. NOTWITHSTANDING THE FOREGOING, NOTHING CONTAINED IN THIS SECTION SHALL
LIMIT OR OTHERWISE IMPAIR IN ANY MANNER BUYER’S RIGHT TO MAKE A CLAIM FOR ACTUAL
FRAUD.

 

 25 

 

 

ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER

 

As an inducement to Sellers to enter into this Agreement and to consummate the
transactions contemplated hereby, except as disclosed in the disclosure schedule
delivered by Buyer to Sellers concurrently with the execution of this Agreement
(the “Buyer Disclosure Schedule”), Buyer represents and warrants to Sellers as
follows:

 

4.1          Organization. Buyer is a limited partnership duly formed, validly
existing and in good standing under the laws of the Delaware. Buyer has all
requisite limited partnership power and authority to own, lease and operate its
properties and assets and to carry on its business as presently conducted.

 

4.2          Corporate Authority Relative to this Agreement; Consents and
Approvals; No Violation.

 

(a)       Buyer has the requisite limited partnership power and authority to
execute and deliver this Agreement and the Ancillary Documents to which it is a
party and to consummate the transactions contemplated hereby, including the
Asset Purchase. The execution, delivery and performance by Buyer of this
Agreement and the Ancillary Documents to which it is a party and the
consummation by Buyer of the transactions contemplated hereby, including the
Asset Purchase, have been duly and validly authorized by the general partner of
Buyer and, no other action or proceedings on the part of Buyer, or vote of
Buyer’s partners, are necessary to authorize the execution and delivery by Buyer
of this Agreement and the Ancillary Documents to which it is a party and the
consummation of the transactions contemplated hereby, including the Asset
Purchase. This Agreement and the Ancillary Documents to which it is a party have
been duly and validly executed and delivered by Buyer and, assuming this
Agreement constitutes the legal, valid and binding agreement of Sellers, this
Agreement and the Ancillary Documents to which it is a party constitute the
legal, valid and binding agreements of Buyer and are enforceable against Buyer
in accordance with their terms, except as such enforcement may be subject to the
Enforceability Exceptions.

 

(b)       Other than in connection with or in compliance with the Transaction
Approvals, no authorization, consent, order, license, permit or approval of, or
registration, declaration, notice or filing with, any Governmental Entity or
other third party, is required to be made or obtained, under applicable Law, for
the consummation by Buyer of the transactions contemplated hereby, including the
Asset Purchase, except for such authorizations, consents, orders, licenses,
permits, approvals, registrations, declarations, notices and filings that are
not required to be made or obtained prior to the consummation of such
transactions.

 

(c)       The execution and delivery by Buyer of this Agreement does not, and
(assuming the Transaction Approvals are obtained) the consummation of the
transactions contemplated hereby, including the Asset Purchase, and compliance
with the provisions hereof will not, (i) require the making by Buyer of any
declaration, filing or registration with, any Person, other than filings with
the Bankruptcy Court, (ii) conflict with or result in any violation of any
provision of the Organizational Documents of Buyer or (iii) conflict with or
violate any applicable Laws.

 

4.3          Litigation. There is no Proceeding to which Buyer or any of its
Subsidiaries is a party pending or, to Buyer’s knowledge, threatened, and Buyer
is not subject to any outstanding Order, in each case that would reasonably be
expected to have, individually or in the aggregate, a material adverse effect on
the ability of Buyer to perform its obligations under this Agreement and the
Ancillary Documents to which it is a party, for Buyer to assume and perform the
Assumed Liabilities or for Buyer to consummate on a timely basis the
transactions contemplated hereby or thereby.

 

 26 

 

 

4.4          Buyer Information. None of the information supplied or to be
supplied by Buyer to Parent in writing for inclusion or incorporation by
reference in any filings required under the applicable U.S. federal securities
Laws, including the rules and regulations of the SEC thereunder, relating to the
Asset Purchase will, at the time such documents are filed with the SEC or at any
time such documents are amended or supplemented, contain any untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they are made, not misleading. Notwithstanding the
foregoing, no representation or warranty is made by Buyer with respect to
statements made or incorporated by reference therein based on information
supplied by or on behalf of Sellers expressly for inclusion or incorporation by
reference therein.

 

4.5          Finders or Brokers. Other than CIM Partners and Vasto Advisors, no
broker, finder or investment banker is entitled to any broker’s, finder’s or
financial advisor’s fee or commission in connection with the transactions
contemplated hereby based upon arrangements made by or on behalf of Buyer or
Buyer’s board of directors (or similar governing body).

 

4.6          Solvency. Buyer has, as of the Agreement Date, and will have at and
as of the Closing Date sufficient available funds to consummate the Asset
Purchase and to promptly make, when due, all payments required to be made in
connection with this Agreement, including payment of the Cash Balance, and
satisfaction of all of the Assumed Liabilities and the Cure Costs. As of the
Agreement Date, Buyer has no reason to believe that the representations
contained in the immediately preceding sentence will not be true at and as of
the Closing Date. Based on the accuracy of the representations and warranties
set forth in Article III, immediately after giving effect to the transactions
contemplated hereby, (a) Buyer and its Subsidiaries, taken as a whole, will not
(i) be insolvent as defined in Section 101 of the Bankruptcy Code, (ii) have
incurred Indebtedness beyond their ability to pay such Indebtedness as it
matures or becomes due and (iii) have unreasonably small capital to carry on
their businesses as presently conducted or as proposed to be conducted, (b) the
then present fair saleable value of the assets of Buyer and its Subsidiaries,
taken as a whole, will exceed the amount that will be required to pay their
Liabilities (including the amount of all contingent Liabilities) and
Indebtedness as it becomes absolute or matured, and (c) the assets of Buyer and
its Subsidiaries, taken as a whole, at a fair valuation, will exceed their
Liabilities (including the amount of all contingent Liabilities) and
Indebtedness.

 

4.7          Adequate Assurances Regarding the Buyer Assumed Agreements. As of
the Closing, Buyer will be capable of satisfying the conditions contained in
Sections 365(b)(1)(C) and 365(c) of the Bankruptcy Code with respect to the
Buyer Assumed Agreements.

 

4.8          Certain Arrangements; Ownership of Sellers. There are no contracts,
undertakings, commitments, agreements, obligations or understandings, whether
written or oral, between Buyer or any of its Affiliates, on the one hand, and
any member of Sellers’ management or Sellers’ boards of directors, on the other
hand, relating in any way to Sellers (including with respect to the management
or control of Sellers), the transactions contemplated hereby or to the
operations of Parent (solely related to the Acquired Business), NY Agri and the
Acquired Subsidiaries after the Closing. Buyer does not hold, directly or
indirectly, any beneficial or other ownership interest in any of Sellers or
their Subsidiaries or any of their respective securities.

 

 27 

 

 

4.9         Guarantee. Concurrently with the execution of this Agreement, New
Mountain Partners V, L.P., a Delaware limited partnership (the “Guarantor”), has
delivered to Sellers a duly executed limited guarantee pursuant to which the
Guarantor has guaranteed certain obligations under this Agreement (the
“Guarantee”). The Guarantee is in full force and effect, has not been amended or
modified and is a legal and valid and binding obligation of the Guarantor. No
event has occurred which, with or without notice, lapse of time or both, would
constitute a default or breach or failure to satisfy a condition under the terms
and conditions of the Guarantee on the part of the Guarantor under the
Guarantee.

 

4.10        Investment Intention. Buyer is acquiring the capital stock of the
Acquired Subsidiaries for its own account, for investment purposes only and not
with a view to the distribution (as such term is used in Section 2(a)(11) of the
Securities Act). Buyer understands that the capital stock of the Acquired
Subsidiaries may not have been registered under the Securities Act and may not
be sold unless subsequently registered under the Securities Act or an exemption
from such registration is available

 

4.11        Investigation; No Other Representations.

 

(a)       BUYER HAS CONDUCTED ITS OWN INDEPENDENT REVIEW AND ANALYSIS OF THE
BUSINESS, OPERATIONS, ASSETS, CONTRACTS, INTELLECTUAL PROPERTY, REAL ESTATE,
TECHNOLOGY, LIABILITIES (CONTINGENT, PRESENT AND OTHERWISE), RESULTS OF
OPERATIONS, FINANCIAL CONDITION AND PROSPECTS OF SELLERS, THE ACQUIRED
SUBSIDIARIES AND THE ACQUIRED BUSINESS, AND ACKNOWLEDGES THAT IT AND ITS
REPRESENTATIVES HAVE RECEIVED ACCESS TO SUCH BOOKS AND RECORDS, FACILITIES,
EQUIPMENT, CONTRACTS AND OTHER ASSETS AND PROPERTIES OF SELLERS, THE ACQUIRED
SUBSIDIARIES AND THE ACQUIRED BUSINESS THAT IT AND ITS REPRESENTATIVES HAVE
REQUESTED TO REVIEW AND THAT IT AND ITS REPRESENTATIVES HAVE HAD THE OPPORTUNITY
TO MEET WITH THE MANAGEMENT OF SELLERS AND TO DISCUSS THE RESPECTIVE BUSINESSES
AND ASSETS OF PARENT (IN RESPECT OF THE ACQUIRED BUSINESS), NY AGRI AND THE
ACQUIRED SUBSIDIARIES AND THE ACQUIRED BUSINESS. BUYER, ON BEHALF OF ITSELF AND
ON BEHALF OF ITS RESPECTIVE AFFILIATES AND REPRESENTATIVES, ACKNOWLEDGES THAT
THE PURCHASED ASSETS SOLD PURSUANT TO THIS AGREEMENT ARE SOLD, CONVEYED,
TRANSFERRED, AND ASSIGNED ON AN “AS IS, WHERE IS” BASIS “WITH ALL FAULTS” AND
THAT, NOTWITHSTANDING ANYTHING SET FORTH HEREIN OR IN ANY OTHER ANCILLARY
DOCUMENT TO THE CONTRARY, OTHER THAN THE REPRESENTATIONS AND WARRANTIES
EXPRESSLY SET FORTH IN ARTICLE III (AS QUALIFIED BY THE SELLERS DISCLOSURE
SCHEDULE AND THE PARENT SEC DISCLOSURES AND BANKRUPTCY COURT FILINGS) OR IN ANY
ANCILLARY DOCUMENT (INCLUDING ANY CERTIFICATE DELIVERED PURSUANT TO THIS
AGREEMENT), NONE OF SELLERS, THE ACQUIRED SUBSIDIARIES, ANY OF THEIR RESPECTIVE
AFFILIATES OR ANY OTHER PERSON ON BEHALF OF SELLERS, THE ACQUIRED SUBSIDIARIES
OR THEIR AFFILIATES MAKES ANY REPRESENTATIONS OR WARRANTIES (INCLUDING ANY
IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, WHICH
WARRANTIES ARE ALSO HEREBY EXPRESSLY DISCLAIMED), TERMS, CONDITIONS,
UNDERSTANDINGS OR COLLATERAL ASSIGNMENTS OF ANY NATURE OR KIND, EXPRESS OR
IMPLIED, BY STATUTE OR OTHERWISE WITH RESPECT TO (A) THE PURCHASED ASSETS, THE
ACQUIRED BUSINESS, SELLERS OR THE ACQUIRED SUBSIDIARIES, OR WITH RESPECT TO ANY
OTHER INFORMATION PROVIDED, OR MADE AVAILABLE, TO BUYER OR ITS AFFILIATES OR
REPRESENTATIVES IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED HEREBY,
INCLUDING THE ACCURACY OR COMPLETENESS THEREOF, OR (B) THE CONDITION OF ANY REAL
PROPERTY OWNED, LEASED OR USED IN THE ACQUIRED BUSINESS OR WITH REGARD TO THE
USE, EXISTENCE OR RELEASE OF ANY REGULATED SUBSTANCES AT, ON, UNDER OR AROUND
ANY REAL PROPERTY OWNED, LEASED OR USED IN THE ACQUIRED BUSINESS.

 

 28 

 

 

(b)       WITHOUT LIMITING THE FOREGOING, BUYER ACKNOWLEDGES AND AGREES THAT,
EXCEPT FOR ANY REMEDIES AVAILABLE UNDER THIS AGREEMENT WITH RESPECT TO THE
REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN ARTICLE III (AS QUALIFIED
BY THE SELLERS DISCLOSURE SCHEDULE AND THE PARENT SEC DISCLOSURES AND BANKRUPTCY
COURT FILINGS) OR IN ANY ANCILLARY DOCUMENT (INCLUDING ANY CERTIFICATE DELIVERED
PURSUANT TO THIS AGREEMENT), NONE OF SELLERS, THE ACQUIRED SUBSIDIARIES OR ANY
OTHER PERSON WILL HAVE OR BE SUBJECT TO ANY LIABILITY OR OTHER OBLIGATION TO
BUYER OR ITS REPRESENTATIVES OR AFFILIATES OR ANY OTHER PERSON RESULTING FROM
BUYER’S, ITS REPRESENTATIVES’ OR AFFILIATES’ USE OF ANY INFORMATION, DOCUMENTS,
PROJECTIONS, FORECASTS OR OTHER MATERIAL MADE AVAILABLE TO BUYER OR ITS
REPRESENTATIVES OR AFFILIATES, INCLUDING ANY INFORMATION MADE AVAILABLE IN THE
ELECTRONIC DATA ROOM MAINTAINED BY OR ON BEHALF OF SELLERS OR THEIR
REPRESENTATIVES FOR PURPOSES OF THE TRANSACTIONS CONTEMPLATED HEREBY, TEASERS,
MARKETING MATERIALS, CONSULTING REPORTS OR MATERIALS, CONFIDENTIAL INFORMATION
MEMORANDA, MANAGEMENT PRESENTATIONS, FUNCTIONAL “BREAK-OUT” DISCUSSIONS,
RESPONSES TO QUESTIONS SUBMITTED ON BEHALF OF BUYER OR ITS REPRESENTATIVES OR IN
ANY OTHER FORM IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED HEREBY. IN
CONNECTION WITH THE DUE DILIGENCE INVESTIGATION OF SELLERS, THE ACQUIRED
SUBSIDIARIES AND THE ACQUIRED BUSINESS BY BUYER, BUYER HAS RECEIVED AND MAY
CONTINUE TO RECEIVE FROM SELLERS OR THEIR REPRESENTATIVES CERTAIN ESTIMATES,
PROJECTIONS, FORECASTS AND OTHER FORWARD-LOOKING INFORMATION, AS WELL AS CERTAIN
BUSINESS PLAN INFORMATION, REGARDING SELLERS, THE ACQUIRED SUBSIDIARIES, THE
PURCHASED ASSETS AND/OR THE ACQUIRED BUSINESS. BUYER HEREBY ACKNOWLEDGES, ON
BEHALF OF ITSELF AND ITS AFFILIATES AND REPRESENTATIVES, THAT THERE ARE
UNCERTAINTIES INHERENT IN ATTEMPTING TO MAKE SUCH ESTIMATES, PROJECTIONS,
FORECASTS AND OTHER FORWARD-LOOKING STATEMENTS, AS WELL AS IN SUCH BUSINESS
PLANS, WITH WHICH BUYER IS FAMILIAR, THAT BUYER AND ITS AFFILIATES AND
REPRESENTATIVES ARE NOT RELYING ON, AND ARE TAKING FULL RESPONSIBILITY FOR
MAKING THEIR OWN EVALUATION OF, THE ADEQUACY AND ACCURACY OF ALL ESTIMATES,
PROJECTIONS, FORECASTS AND OTHER FORWARD-LOOKING INFORMATION, AS WELL AS SUCH
BUSINESS PLANS, SO FURNISHED TO THEM (INCLUDING THE REASONABLENESS OF THE
ASSUMPTIONS UNDERLYING SUCH ESTIMATES, PROJECTIONS, FORECASTS, FORWARD-LOOKING
INFORMATION OR BUSINESS PLANS). NOTWITHSTANDING THE FOREGOING, NOTHING CONTAINED
IN THIS SECTION SHALL LIMIT OR OTHERWISE IMPAIR IN ANY MANNER BUYER’S RIGHT TO
MAKE A CLAIM FOR ACTUAL FRAUD.

 

ARTICLE V
COVENANTS AND AGREEMENTS

 

5.1          Conduct of Business. During the period from the Agreement Date
until the earlier of the termination of this Agreement in accordance with its
terms or the Closing, Sellers shall, and shall cause the Acquired Subsidiaries
to, use commercially reasonable efforts to maintain the Purchased Assets and
conduct the Acquired Business in all material respects in the Ordinary Course of
Business, except (i) as may be required by applicable Law, (ii) with the prior
written consent of Buyer (which shall not be unreasonably withheld, conditioned
or delayed), (iii) as may be required by the Bankruptcy Court, (iv) as expressly
permitted or contemplated or required by this Agreement (including Section
5.8(d)), (v) as set forth in Section 5.1 of the Sellers Disclosure Schedule or
(vi) to the extent the effect their being in bankruptcy may have on them and the
Acquired Business.

 

 29 

 

 

5.2          Access.

 

(a)       For purposes of furthering the transactions contemplated hereby,
Sellers shall afford Buyer and its Representatives reasonable access during
normal business hours upon reasonable advance notice to Sellers, throughout the
period from the Agreement Date until the earlier of the termination of this
Agreement and the Closing, to Sellers’ and any Acquired Subsidiary’s personnel,
properties, contracts, commitments, Books and Records and such other information
concerning the business, properties and personnel of the Acquired Business as
Buyer may reasonably request; provided that Sellers shall not be obligated to
provide or give access to any minutes of meetings or resolutions of a Seller’s
or any Acquired Subsidiary’s board of directors (or similar governing body) or
any committees thereof or any other business records or reports of or
communication with any of its advisors relating to the evaluation or negotiation
of this Agreement or the transactions contemplated hereby or any alternatives
thereto. Notwithstanding anything to the contrary contained in this Section
5.2(a), any document, correspondence or information or other access provided
pursuant to this Section 5.2(a) may be redacted or otherwise limited to prevent
disclosure of information concerning any aspect of the Pharma Business, the
valuation of Sellers and/or the Acquired Business and the purchase of the
Purchased Assets or other similarly confidential or competitively sensitive
information. All access pursuant to this Section 5.2(a) shall be (i) conducted
in such a manner as not to interfere unreasonably with the normal operations of
Sellers and the Acquired Subsidiaries and (ii) coordinated exclusively through
the designated Representatives of Sellers. For the avoidance of doubt, Buyer
shall not contact any customers, suppliers, employees, contractors or landlords
of Sellers or any of its Subsidiaries, including the Acquired Subsidiaries,
without Sellers’ prior written consent, which shall not be unreasonably
withheld.

 

(b)       Notwithstanding anything to the contrary contained in this Section
5.2, neither a Seller nor any Acquired Subsidiary shall be required to provide
any access, or make available any document, correspondence or information, if
doing so would, in the reasonable judgment of such Seller’s legal counsel, (i)
jeopardize the attorney-client privilege of a Seller or any Acquired Subsidiary
or (ii) conflict with any Law applicable to a Seller or any Acquired Subsidiary
or the assets or operation of the Acquired Business; provided that in such
instances, Sellers shall inform Buyer of the general nature of the information
being withheld and, upon Buyer’s request, reasonably cooperate with the other
party to provide such information, in whole or in part, in a manner that would
not result in any of the outcomes described in the foregoing clauses (i) and
(ii).

 

(c)       The parties hereto hereby agree that all information provided to them
or their respective Representatives in connection with this Agreement and the
consummation of the transactions contemplated hereby shall be governed in
accordance with the Confidentiality Agreement, dated as of October 19, 2018,
between Parent and New Mountain Capital, L.L.C. (the “Confidentiality
Agreement”), which shall continue in full force and effect in accordance with
its terms.

 

 30 

 

 

(d)       In order to facilitate a Seller’s efforts to (i) administer and close
the Bankruptcy Case, including for purposes of administering and closing any
insurance claims and any Proceedings to which any Seller or any of its
Subsidiaries is a party (other than in connection with any Proceeding with
Buyer) (together, the “Post-Close Proceedings”), and (ii) prepare Tax Returns
(together, the “Post-Close Filings”), for a period of seven (7) years following
the Closing, Buyer shall permit Sellers and Sellers’ counsel, accountants and
other Representatives (collectively, “Permitted Access Parties”) during regular
business hours, with reasonable notice, and subject to reasonable rules and
regulations, reasonable access to the financial and other Books and Records
which comprised part of the Purchased Assets, and to employees, officers,
advisors and accountants of Buyer, in each case to the extent required to
complete the Post-Close Filings or to administer and close the Post-Close
Proceedings, which access shall include (A) the right of such Permitted Access
Parties to copy, at such Permitted Access Parties’ expense, such required
documents and records and (B) Buyer’s copying and delivering to the relevant
Permitted Access Parties such documents or records as they require, but only to
the extent such Permitted Access Parties furnish Buyer with reasonably detailed
written descriptions of the materials to be so copied and applicable Permitted
Access Party reimburses Buyer for the reasonable costs and expenses thereof;
provided, however, that the foregoing rights of access shall not be exercisable
in such a manner as to interfere with the normal operations of Buyer’s business.
For a period of seven (7) years following the Closing, or such longer period as
may be required by applicable Law or necessitated by applicable statutes of
limitations, Buyer shall, and shall cause its Subsidiaries to, maintain all such
Books and Records in the jurisdiction in which such Books and Records were
located prior to the Closing Date and shall not destroy, alter or otherwise
dispose of any such Books and Records. On and after the end of such period,
Buyer shall, and shall cause its Subsidiaries to, provide Sellers with at least
ten (10) Business Days prior written notice before destroying, altering or
otherwise disposing any such Books and Records, during which period the Sellers
may elect to take possession, at its own expense, of such Books and Records.
Notwithstanding anything contained in this Section 5.2 to the contrary, in no
event shall a Seller have access to any information that, based on advice of
Buyer’s counsel, could (i) reasonably be expected to create liability under
applicable Law, or waive any legal privilege, (ii) result in the discharge of
any Trade Secrets of Buyer, its affiliates or any third parties or (iii) violate
any obligation of Buyer with respect to confidentiality. The Official Committee
of the Unsecured Creditors in the Bankruptcy Case (through its court retained
professionals and not members of the creditors committee individually, the
“Unsecured Creditors”) shall be a Permitted Access Party under this Section
5.2(d) until two (2) years after the Closing, subject to the terms, conditions
and limitations hereof, including without limitation the reimbursement
obligation hereunder and subject to the same limitations regarding confidential
or competitively sensitive information as are set forth in Section 5.2(a) and,
provided that the Unsecured Creditors execute a confidentiality agreement with
Buyer and Sellers, in form and substance that is mutually acceptable to such
parties.

  

5.3          Employees and Employee Benefit Plans.

 

(a)       Transferred Employees. Prior to the date hereof, Buyer offered
employment to Sellers’ employees who are exclusively employed in respect of the
Acquired Business as of the date of the Original Agreement (the “Business
Employees”) and who remain employed by Sellers or such Acquired Subsidiary
immediately prior to the Closing (including employees on approved leave of
absence) and who were listed on Section 5.3(b) of the Seller Disclosure Schedule
as of the date of the Original Agreement, with Comparable Positions and
Comparable Compensation and Benefits. Offer letters were not sent to employees
of the Acquired Subsidiaries. As soon as practicable after the date hereof, and
in any event no later than five Business Days prior to the Closing, Buyer shall
offer employment to the four employees listed on Section 5.3(b) of the Seller
Disclosure Schedule who were not listed on Section 5.3(b) of the Seller
Disclosure Schedule as of the date of the Original Agreement, with Comparable
Positions and Comparable Compensation and Benefits. Those employees who accept
Buyer’s offer of employment and commence working for Buyer on the Closing Date
(or upon return to work from approved leave of absence) shall hereafter be
referred to as “Transferred Employees.”

 

(b)       Business Employees. Section 5.3(b) of the Sellers Disclosure Schedule
sets out a complete and accurate list of all Business Employees, including, for
each employee: (i) name (or to the extent not permitted by applicable Law,
employee identification number); (ii) job title; (iii) hire date; (iv) work
location; (v) current annual base compensation; (vi) commission, target bonus or
other incentive-based compensation; (vii) leave status (including estimated
return date), and (viii) visa or other work permit status (if applicable).

 

 31 

 

 

(c)       Credit under Buyer Benefit Plans. Buyer will take commercially
reasonable best efforts to cause any employee benefit plans of Buyer (or any
Affiliate thereof sponsoring or maintaining such plans) in which the Transferred
Employees are eligible to participate following the Closing Date (the “Buyer
Benefit Plans”) to take into account for purposes of eligibility, vesting and
accrual of and entitlement to benefits (but not for accrual of benefits under
any “defined benefit plan,” as defined in Section 3(35) of ERISA), and all other
purposes, all service by the Transferred Employees with Sellers prior to the
Closing as if such service were with Buyer or its Affiliates, to the same extent
such service was credited under a comparable Seller Benefit Plan prior to the
Closing (except to the extent it would result in the duplication of benefits).
In addition, with respect to each Buyer Benefit Plan that is a “welfare benefit
plan” (as defined in Section 3(1) of ERISA), Buyer shall, or shall cause an
Affiliate of Buyer sponsoring or maintaining such Buyer Benefit Plan, to take
commercially reasonable best efforts to (i) cause there to be waived any
pre-existing condition exclusions, actively at work requirements, insurability
requirements or other eligibility limitations to the extent such exclusions,
requirements or limitations were waived or were inapplicable under a comparable
Seller Benefit Plan prior to the Closing, and (ii) give effect, in determining
any deductible, co-insurance and maximum out-of-pocket limitations, to claims
incurred and amounts paid by, and amounts reimbursed to, the Transferred
Employees and their dependents under a comparable Seller Benefit Plan prior to
the Closing. Buyer shall be solely responsible for complying with the
requirements of Part 6 of Subtitle B of Title I of ERISA and Section 4980B of
the Code for any employee of any Seller who is an “M&A qualified beneficiary” as
defined in Q&A-4 of Treas. Reg. §54.4980B-9 in connection with the transactions
contemplated hereby.

 

(d)       Employment Tax Reporting. With respect to Transferred Employees, Buyer
and Sellers shall use the alternate procedure set forth in Revenue Procedure
2004-53, 2004-34 I.R.B. 320, provided that Sellers provide to Buyer all
information necessary for Buyer to complete such alternate procedure and that
third party payroll provider agrees it can accommodate utilization of the
alternate procedure to properly report and remit federal and state payroll.

 

(e)       No Obligation. Nothing contained in this Agreement shall be construed
to require the employment of (or prevent the termination of employment of) any
individual, require minimum benefit levels or prevent any change in the employee
benefits provided to any individual Transferred Employee. No provision of this
Agreement shall create any third party beneficiary rights in any employee or
former employee of a Seller or any Acquired Subsidiary or any other Person
(including any beneficiary or dependent thereof) of any nature or kind
whatsoever, including in respect of continued employment (or resumed employment)
for any specified period. Nothing contained herein, express or implied, shall
(i) be construed to establish, amend or modify any Seller Benefit Plan or other
benefit plan, program, agreement or arrangement or (ii) alter or limit the
ability of Sellers, Buyer or any of their respective Affiliates to amend,
modify, or terminate any benefit plan, program, agreement or arrangement at any
time assumed, established, sponsored or maintained by any of them. Nothing in
this Section 5.3 is intended to interfere with Buyer’s right from and after the
Closing to terminate the employment of, or change the compensation and benefits
available to, any Transferred Employee.

 

(f)       Nonqualified Deferred Compensation Plans. To the extent that any
Transferred Employee has any benefit payable to him or her as of the Closing
Date in the nonqualified deferred compensation plans of Sellers (each, a “NQ
Plan”), Sellers shall, and shall cause its Affiliates to, as soon as practical
after the Closing Date, split such NQ Plans into one or more separate plans that
contains only the benefits payable to Transferred Employees to the extent such
benefits are not otherwise distributed upon or promptly following the Closing
Date under the terms of such NQ Plan. Buyer and Sellers intend and agree in
accordance with Treasury Regulation Section 1.409A-1(h)(4) that the transfer of
employment of the Transferred Employees from Sellers (or their respective
Affiliates) to Buyer (or its Affiliates) in connection with the transactions
contemplated by this Agreement (and the related termination of employment of the
Transferred Employees from Sellers) shall not constitute a “separation from
service” for purposes of Code Section 409A and the Treasury Regulations
thereunder. If Seller maintains a “rabbi trust” with respect to a NQ Plan (each
an “Existing NQ Trust”), to the extent transferred pursuant to Section 1.1(o),
either (i) Seller shall, as soon as practical after the Closing Date, establish
a new rabbi trust (each a “New NQ Trust”) and cause the assets of the Existing
NQ Trust, to the extent payable to a Transferred Employee who has a benefit as
of the Closing Date in the NQ Plan that is not otherwise distributed upon or
promptly following the Closing Date under the terms of the applicable NQ Plan
(the “Transferable Assets”), to be transferred to the New NQ Trust, which New NQ
Trust shall be assumed by Buyer, or (ii) Buyer shall, as soon as practical after
the Closing Date, establish a new rabbi trust in form and substance satisfactory
to the Sellers for the benefit of Transferred Employees who have benefits
payable to them as of the Closing Date in the NQ Plan that are not otherwise
distributed upon or promptly following the Closing Date under the terms of the
applicable NQ Plan (the “Buyer Trust”), and Seller shall cause the Transferable
Assets to be transferred to the Buyer Trust, and Buyer shall cause the Buyer
Trust to accept the Transferable Assets, as soon as practical after such Buyer
Trust is established.

 

 32 

 

 

5.4          Regulatory Approvals; Efforts.

 

(a)       Prior to the Closing, Buyer and Sellers shall, and shall cause their
respective Affiliates to, use their respective reasonable best efforts to take,
or cause to be taken, all actions, and to do, or cause to be done, all things
necessary, proper or advisable under any applicable Laws to consummate the Asset
Purchase as promptly as practicable, including (i) preparing and filing all
forms, registrations and notifications with any Governmental Entities or third
parties required to be filed to consummate the Asset Purchase, (ii) using
reasonable best efforts to satisfy the conditions to consummating the Asset
Purchase, (iii) using reasonable best efforts to obtain (and to cooperate with
each other in obtaining) any consent, authorization, expiration or termination
of a waiting period, permit, Order or approval of, waiver or any exemption by,
any Governmental Entity required to be obtained or made by Buyer, Sellers or any
of their respective Affiliates in connection with the Asset Purchase or the
taking of any action contemplated hereby, (iv) defending any lawsuits or other
legal Proceedings, whether judicial or administrative, challenging this
Agreement or the consummation of the Asset Purchase, and (v) using reasonable
best efforts with respect to the execution and delivery of all such instruments,
deeds, assignments or assurances and do all other things reasonably necessary or
desirable to consummate the Asset Purchase and to fully carry out the purposes
or intent of this Agreement.

 

(b)       Buyer, on the one hand, and Sellers, on the other hand, shall each
keep the other apprised of the status of matters relating to the consummation of
the Closing and work cooperatively in connection with obtaining all required
consents, authorizations, Orders or approvals of, or any exemptions by, any
Governmental Entity undertaken pursuant to the provisions of this Section 5.4.
In that regard, prior to the Closing, each party shall promptly consult with the
other parties to this Agreement with respect to and provide any necessary
information and assistance as the other parties may reasonably request with
respect to (and, in the case of correspondence, provide the other parties (or
their counsel and, if reasonably determined necessary, advisable or convenient
to protect attorney-client privilege or competitively sensitive information,
outside counsel only basis) with copies of) all notices, submissions or filings
made by or on behalf of such party or any of its Affiliates with any
Governmental Entity or any other information supplied by or on behalf of such
party or any of its Affiliates to, or correspondence with, a Governmental Entity
in connection with this Agreement and the Asset Purchase. Each party to this
Agreement shall promptly inform the other parties to this Agreement, and if in
writing, furnish the other parties with copies of (or, in the case of oral
communications, advise the other parties orally of) any communication from or to
any Governmental Entity regarding the Asset Purchase, and permit the other
parties to review and discuss in advance, and consider in good faith the views
of the other parties in connection with, any proposed communication or
submission with any such Governmental Entity. No party or any of its Affiliates
shall participate in any meeting or teleconference with any Governmental Entity
in connection with this Agreement and the Asset Purchase unless it consults with
the other parties in advance and, to the extent not prohibited by such
Governmental Entity, gives the other parties the opportunity to attend and
participate thereat. Notwithstanding the foregoing, Buyer and Sellers may, as
each deems advisable and necessary, reasonably designate any competitively
sensitive material provided to the other under this Section 5.4(b) as “Antitrust
Counsel Only Material.” Such materials and the information contained therein
shall be given only to the outside counsel of the recipient and will not be
disclosed by such outside counsel to employees, officers or directors of the
recipient unless express permission is obtained in advance from the source of
the materials (Buyer or Sellers, as the case may be) or its legal counsel.
Notwithstanding anything to the contrary contained in this Section 5.4,
materials provided pursuant to this Section 5.4 may be redacted (i) to remove
references concerning the valuation of the Acquired Business and the purchase of
the Purchased Assets, (ii) as necessary to comply with contractual arrangements
and (iii) as necessary to address reasonable privilege concerns.

 

 33 

 

 

(c)       Sellers and Buyer acknowledge that they have filed prior to the date
hereof with the appropriate Governmental Entity all filings, forms,
registrations and notifications required to be filed to consummate the purchase
of the Purchased Assets under the HSR Act and any other applicable Antitrust
Law, and that early termination of the applicable waiting period under the HSR
Act was granted effective March 18, 2019. Sellers and Buyer shall cause their
respective Affiliates to, as promptly as practicable, respond to inquiries from
Governmental Entities, or provide any supplemental information that may be
requested by Governmental Entities, in connection with filings made with such
Governmental Entities.

 

(d)       Notwithstanding anything to the contrary set forth in this Agreement,
Buyer shall, in order to comply with Section 5.4(b) and so as to permit the
Closing to occur as promptly as practicable and in any event before the End Date
(i) propose, negotiate, commit to, effect and agree to, by consent decree, hold
separate order, or otherwise, the sale, divestiture, license, holding separate,
and other disposition of and restriction on the businesses, assets, properties,
product lines, and equity interests of, or changes to the conduct of business
of, the Acquired Business and Sellers, Buyer and their respective Affiliates
(including, with respect to Sellers and the Acquired Subsidiaries), and (ii)
create, terminate, or divest relationships, ventures, contractual rights or
obligations of Buyer or its Affiliates or, solely in respect of the Acquired
Business, Sellers, the Acquired Subsidiaries or their respective Affiliates,. If
requested by Buyer, Sellers will agree to any action contemplated by this
Section 5.4; provided that any such agreement or action is conditioned on the
consummation of the Asset Purchase. Without limiting the foregoing, in no event
will a Seller (and such Seller will not permit any of its Affiliates to)
propose, negotiate, effect or agree to any such actions without the prior
written consent of Buyer, such consent not to be unreasonably withheld,
conditioned or delayed.

 

(e)       In furtherance and not in limitation of the covenants of the parties
contained in this Section 5.4, if any administrative or judicial action or
Proceeding, including any Proceeding by a private party, is instituted (or
threatened to be instituted) challenging the Asset Purchase or any other
transaction contemplated hereby as violative of any Antitrust Law, Sellers and
Buyer shall use reasonable best efforts to contest and resist any such action or
Proceeding and to have vacated, lifted, reversed or overturned any decree,
judgment, injunction or other order, whether temporary, preliminary or
permanent, that is in effect and that prohibits, prevents or restricts
consummation of the Asset Purchase.

 

(f)       Except as specifically required by this Agreement, Buyer shall not,
and shall not permit any of its Affiliates to, knowingly take any action, or
knowingly refrain from taking any action, the effect of which would be to delay
or impede the ability of the parties hereto to consummate the transactions
contemplated hereby. Without limiting the generality of the foregoing, Buyer
shall not, and shall not permit any of its Affiliates to, acquire or agree to
acquire by merging or consolidating with, or by purchasing a substantial portion
of the assets of or equity in, or by any other manner, any Person or portion
thereof, or otherwise acquire or agree to acquire any assets, if the entering
into of a definitive agreement relating to or the consummation of such
acquisition, merger or consolidation could reasonably be expected to (i) impose
any delay in the obtaining of, or increase the risk of not obtaining, any
consent, approval, authorization, declaration, waiver, license, franchise,
permit, certificate or order of any Governmental Entity necessary to consummate
the transactions contemplated hereby or the expiration or termination of any
applicable waiting period, (ii) increase the risk of any Governmental Entity
entering an Order prohibiting the consummation of the transactions contemplated
hereby or (iii) delay the consummation of the transactions contemplated hereby.

 

 34 

 

 

(g)       The fees and expenses for all filings under the HSR Act and any other
necessary filings or submissions to any Governmental Entity pursuant to this
‎Section 5.4 shall be borne in full by Buyer as and when due.

 

5.5          Notification of Certain Matters. Except for litigations or other
Proceedings commenced, filed or pending in the Bankruptcy Court, each Party
shall promptly (and in any event, within two (2) Business Days) notify the other
Parties in writing of any litigation or other Proceeding brought or threatened
in writing against it or its directors or executive officers or other
Representatives relating to this Agreement, the Asset Purchase and/or the other
transactions contemplated hereby and shall keep the other Parties informed on a
reasonably current basis with respect to the status thereof (including by
promptly furnishing to the other Parties and their respective Representatives
such information relating to such litigation or other Proceeding as may be
reasonably requested). Each Party shall, subject to the preservation of the
attorney-client and similar privileges and confidential information, give the
other Parties the opportunity to participate in (but not control) the defense or
settlement of any litigation or other Proceeding against it and/or its directors
or executive officers or other Representatives relating to this Agreement, the
Asset Purchase or the other transactions contemplated hereby and shall give due
consideration to such other Parties’ advice with respect to such litigation or
other Proceeding.

 

5.6          Adequate Assurances regarding the Buyer Assumed Agreements. With
respect to each Buyer Assumed Agreement, Buyer will use commercially reasonable
efforts to provide adequate assurance as required under the Bankruptcy Code of
the future performance by Buyer of each such Buyer Assumed Agreement. Sellers
and Buyer agree that they will promptly take all actions reasonably required to
assist in obtaining a Bankruptcy Court finding that there has been an adequate
demonstration of adequate assurance of future performance under the Buyer
Assumed Agreements, such as furnishing affidavits, non-confidential financial
information or other documents or information for filing with the Bankruptcy
Court and making Sellers’ and Buyer’s employees and representatives available to
testify before the Bankruptcy Court.

 

5.7          Bankruptcy Court Approval. Sellers and Buyer acknowledge that this
Agreement and the sale of the Purchased Assets are subject to Bankruptcy Court
approval. To assist in obtaining such approval, Buyer agrees that it will
promptly take such actions as are reasonably requested by Sellers to assist in
obtaining entry of the Sale Order and a finding of adequate assurance of future
performance by Buyer with respect to the Buyer Assumed Agreements., including
furnishing affidavits or other documents or information for the purposes, among
others, of providing necessary assurances of performance by Buyer under this
Agreement and demonstrating that Buyer is a “good faith” purchaser under Section
363(m) of the Bankruptcy Code.

 

5.8          Taxes.

 

(a)       Without the prior written consent of Sellers, Buyer shall not make any
election under Section 336 or 338 of the Code for or with respect to any
Acquired Subsidiary in connection with the transactions provided for herein. The
provisions of this Section 5.8(a) shall expressly survive Closing or any earlier
termination of this Agreement.

 

 35 

 

 

(b)       Without limiting the other terms set forth in this Agreement, any
sales Tax, use Tax, real property transfer, real property records recordation
fees, documentary or stamp Tax, excise Tax or similar non-income Tax
attributable to the sale or transfer of the Purchased Assets and not exempted
under the Sale Order (“Transfer Taxes”) shall be borne by Buyer. Buyer shall, at
its own expense, file any necessary Tax Returns relating to Transfer Taxes and
other documentation with respect to any Transfer Taxes, and Sellers will provide
such cooperation as Buyer shall reasonably request in connection with such
filings, provided that Buyer shall reimburse Sellers for any reasonable and out
of pocket expenses Sellers incur in connection with such cooperation. For the
avoidance of doubt, any China Enterprise Income Tax (“EIT”) imposed on any
capital gain in connection with a transfer of the Aceto (Shanghai) Ltd. shares
(“Applicable EIT”) shall not be a Transfer Tax and shall not be borne by Buyer
and shall be borne by Sellers. Buyer is entitled to withhold any amounts
required to be withheld in respect of the Applicable EIT from amounts payable to
Sellers pursuant to this Agreement and Sellers agree to provide any information
reasonably requested by Buyer and such cooperation as may be reasonably
requested by Buyer in order to permit the calculation of such Tax, and the
making of required withholding and filings and other compliance with
requirements of applicable Law. Any amounts withheld by Buyer in respect of
Applicable EIT in excess of the amounts required to be paid in respect of
Applicable EIT shall be paid to Sellers reasonably promptly following the
determination that there is such an excess amount. Any refunds received by Buyer
or any Acquired Subsidiary of any Applicable EIT imposed in connection with the
transactions provided for herein paid with funds received or withheld from
Sellers shall be paid by Buyer to Sellers reasonably promptly following such
receipt. Notwithstanding anything to the contrary in this Agreement, any EIT
imposed on any gain in connection with a direct or indirect transfer of the
shares of Aceto HK (including indirect transfer of the real property owned by
Aceto HK in China) shall be treated as a Transfer Tax for all purposes of this
Agreement and borne by Buyer Any Tax, termination fee or similar payment
attributable to an early termination of the “PILOT” (“payment in lieu of taxes”)
program of the Nassau County Industrial Development Agency (“NCIDA”) applicable
or otherwise relating to the Port Washington, NY property as to which Aceto
Realty is the tenant pursuant to a sale leaseback arrangement with the NCIDA
resulting from the transactions provided for herein shall be treated as a
“Transfer Tax” for all purposes of this Agreement. The provisions of this
Section 5.8(b) shall expressly survive Closing.

 

(c)       Tax Liabilities for a period that includes but does not end on the
Closing Date shall be treated for purposes of determining the amount
attributable to the portion of such period that ends on the Closing Date as
follows: (i) in the case of any sales, use, value-added, employment, or
withholding Tax and any Tax based on or measured by income, profits, gains,
receipts or the level of any item or on a transactional basis shall be
determined based on an interim closing of the books as of the end of the day on
the Closing Date, except that exemptions, allowances or deductions that are
calculated on an annual basis (including depreciation and amortization
deductions), other than with respect to property placed in service after the
Closing, shall be allocated on a per diem basis, unless otherwise required by
applicable law, and (ii) in the case of all other Taxes, shall be deemed to be
the amount of such Taxes for the entire period multiplied by a fraction, the
numerator of which is the number of calendar days in the portion of the period
ending on the Closing Date and the denominator of which is the number of
calendar days in the entire period; provided that for these purposes any event
occurring on the Closing Date following the Adjustment Time shall be treated as
occurring on the day after the Closing Date to the extent such event is not
provided for in this Agreement except that events on the Closing Date following
the Adjustment Time but before the Closing that are not in the Ordinary Course
of Business and are not contemplated or required by this Agreement shall be
treated as occurring on the day before the Closing Date.

 

(d)       It is intended by Sellers that, prior to Closing, NY Agri will merge
into a newly formed Delaware corporation, with such Delaware corporation
surviving, in a transaction intended to qualify as a reorganization under
Section 368(a)(1)(F) of the Code and that such surviving Delaware corporation
will, following such merger, convert to a limited liability company under the
Delaware conversion statute. The Parties agree that nothing in this Agreement,
including Section 5.1, shall prevent such merger or conversion or impose any
Liability upon any Seller as a result of such conversion.

 

 36 

 

 

(e)       In addition to the provisions of Section 5.2(d) with respect to
Post-Closing Filings, Buyer and Sellers shall use commercially reasonable
efforts (with respect to Sellers, taking into account the impact of the filing
of the Bankruptcy Case and operating in bankruptcy) to cooperate with each other
regarding Tax matters relating to the Purchased Assets, the Acquired
Subsidiaries or the Acquired Business and shall make available to each other as
reasonably requested all information, records and documents regarding Taxes
relating to the Purchased Assets, the Acquired Subsidiaries or the Acquired
Business until the expiration of the applicable statute of limitations or
extension thereof or the conclusion of all audits, appeals or litigation with
respect to such Taxes.

 

5.9          Public Announcements. Neither Sellers, on the one hand, nor Buyer,
on the other hand, shall, without the approval of the other Parties, make any
press release or other public announcement concerning the transactions
contemplated hereby, except as and to the extent that any such Party shall be so
obligated by Law, including as may be required by the Bankruptcy Case,
securities laws, or the rules of any stock exchange, in which case, each Party
shall be advised prior to such disclosure, consult with each other before
issuing such press release or public announcement and consider in good faith any
comments received from the other Party at least two (2) Business Days prior to
such issuance. The provisions of this Section 5.9 shall expressly survive
Closing or any earlier termination of this Agreement.

 

5.10         Consents; Notices. At or prior to the Closing, Buyer and Sellers
shall use commercially reasonable efforts to obtain all Consents and give all
notices required for Sellers to assign the Buyer Assumed Agreements to which
they are a party to Buyer to the extent not assignable without any such
approval, consent, or notice pursuant to Section 363 or Section 365 of the
Bankruptcy Code. If any Consent is not obtained prior to the Closing, then,
subject to Sellers having appropriate levels of resources and personnel,
Sellers, at the sole cost of Buyer, shall continue to use commercially
reasonable efforts after the Closing to obtain the Consents and, to the extent
permitted by applicable Law, will establish an agency type or other similar
arrangement reasonably satisfactory to Sellers and Buyer under which Buyer would
obtain, to the extent practicable, all rights under the Buyer Assumed Agreements
and assume the corresponding Assumed Liabilities for the period of time that the
Consents are not obtained and the Buyer Assumed Agreements are not assigned. For
the avoidance of doubt, the Parties agree and acknowledge that (a) the failure
by Sellers to obtain any Consents shall not relieve any party of its obligations
to consummate the transactions contemplated hereby, (b) there will not be any
adjustment to the Purchase Price if any Consents are not obtained or certain
Buyer Assumed Agreements are not assigned, and (c) Buyer shall not have any
claim against Sellers after the Closing in respect of any such Consents not
being obtained or Buyer Assumed Agreements not being assigned. Buyer (or its
applicable Subsidiary) shall use commercially reasonable efforts (at its
expense) to obtain Buyer Registrations prior to Closing or as soon thereafter as
reasonably possible. If Buyer (or an applicable Subsidiary of Buyer) has not
obtained Buyer Registrations prior to Closing, the applicable Seller entities
which hold the Sellers’ Registrations prior to Closing shall not dissolve their
legal existence until Buyer (or an applicable Subsidiary of Buyer) has obtained
its own Registrations. Notwithstanding anything to the contrary in this
Agreement, upon confirmation of a Chapter 11 plan in the Bankruptcy Cases,
Sellers may dissolve their legal existence and file their respective
certificates of dissolution (or equivalent filings) but only upon fifteen (15)
calendar days’ written notice to Buyer, which notice shall contain Sellers’ good
faith reasonable estimate of all costs and expenses of continuing as a legal
entity in good standing, including, without limitation, payment of all carrying
costs and post-confirmation quarterly fees due to the U.S. Trustee on behalf of
Sellers (all such costs and expenses, the “Costs”); provided, that, if Buyer
provides a written request within ten (10) calendar days after receiving
Sellers’ notice that it desires any such Seller not to make such filing(s), then
Sellers shall not make such filing(s) until the earlier of (x) the first
anniversary of the Closing, and (y) the date that Buyer obtains Buyer
Registrations, provided that Buyer shall not make such request unless Buyer
agrees (in a manner reasonably acceptable to Sellers) to pay, in advance, all
Costs, as such Costs are reasonably estimated by Sellers in good faith. Nothing
in this Section 5.10, or in Section 2.8(j) or Section 2.10, shall prevent any
Seller from filing and seeking confirmation of a Chapter 11 plan.

 

 37 

 

 

5.11         WARN Act. Buyer shall, or shall cause the Acquired Subsidiaries to,
provide any required notice under and to otherwise comply with, the WARN Act
with respect to any event affecting the Transferred Employees on or after the
Closing Date. Seller shall cooperate with Buyer in determining whether any event
affecting the Transferred Employees on or after the Closing Date requires
notification under the WARN Act. Buyer shall not, and shall cause the Acquired
Subsidiaries not to, take any action on or after the Closing that would cause
Seller or any of its Affiliates to incur liability under the WARN Act.

 

5.12         Directors and Officers. After the Closing, Buyer shall cause the
Acquired Subsidiaries to, honor all the Acquired Subsidiaries’ obligations to,
exculpate, indemnify, defend and hold harmless (including advancing funds for
expenses), to the fullest extent permitted by Law, the current and former
directors and officers of the Acquired Subsidiaries, and any employee of the
Acquired Subsidiaries who acts as a fiduciary under any employee benefit plan,
in each case, solely with respect to acts or omissions by such persons occurring
at or before the Closing and solely with respect to acts or omissions by such
persons in their capacity as a director, officer or employee of the Acquired
Subsidiaries (and not with respect to any other position with Sellers), and such
obligations shall survive the Closing and shall continue in full force and
effect in accordance with the terms of the certificate of incorporation and
by-laws (or similar organizational documents) of the Acquired Subsidiaries and
any individual indemnity agreements or other applicable documents that have been
made available to Buyer at least two Business Days prior to the Agreement Date
from the Closing until the expiration of the applicable statute of limitations
with respect to any claims against such persons arising from, relating to, or
otherwise in respect of, such acts or omissions. After the Closing, Buyer shall
cause the Acquired Subsidiaries to maintain in effect substantially similar
exculpation, indemnification and advancement of expenses provisions of the
certificates of incorporation and by-laws or similar organizational documents of
the Acquired Subsidiaries and any indemnification agreements of the Acquired
Subsidiaries with any of their respective directors, officers or employees that
have been made available to Buyer at least two Business Days prior to the
Agreement Date, in each case as in effect as of the date hereof, and shall not
amend, repeal or otherwise modify any such provisions in any manner that would
materially adversely affect the rights thereunder of any individuals with
respect to such periods on or prior to the Closing Date who at the time of the
Closing were current or former directors, officers or employees of the Acquired
Subsidiaries. If Buyer or any of its successors or assigns (i) consolidates with
or merges into any other Person and shall not be the continuing or surviving
corporation or entity of such consolidation or merger or (ii) transfers or
conveys all or substantially all its properties and assets, then, and in each
case, Buyer shall ensure that such surviving corporation or entity or the
transferees of such properties or assets assume the obligations set forth in
this Section 5.12.

 

 38 

 

 

5.13        Cooperation with Financing.

 

(a)       Prior to the Closing, the Sellers shall use commercially reasonable
efforts to, and shall cause the Acquired Subsidiaries to use their commercially
reasonable efforts to, provide to Buyer, at Buyer’s sole cost and expense, such
cooperation as is reasonably requested by Buyer, or as otherwise reasonably
necessary, in connection with the arrangement and consummation of any debt
financing to be incurred by Buyer on the Closing Date to finance the
consummation of the transactions contemplated hereunder (the “Debt Financing”)
(provided that such requested cooperation does not unreasonably interfere with
the operations of the Sellers or the Acquired Subsidiaries), including (i)
providing prior to the Closing Date (a) the Financial Statements and (b) an
unaudited balance sheet of the Acquired Business as of December 31, 2018 and, if
the Closing has not occurred on or before May 14, 2019, to the extent such
financials would otherwise be produced prior to the Closing in the ordinary
course of business, March 31, 2019, and the related income statement and
statement of cash flows for the six (6)-month period ended December 31, 2018
and, if the Closing has not occurred on or before May 1, 2019, to the extent
such financials would otherwise be produced prior to the Closing in the ordinary
course of business for the nine (9)-month period ended March 31, 2019 (all such
statements and information referred to in this clause (i), the “Required
Information”); (ii) assist with obtaining customary legal opinions, appraisals,
surveys, title insurance, insurance certificates and endorsements, waivers,
environmental reports and other customary documentation and items contemplated
by the Debt Financing as reasonably requested by Buyer; (iii) facilitating the
granting of a security interest (and perfection thereof) in collateral,
guarantees, mortgages or other certificate or documents as may reasonably be
requested by Buyer, in each case effective on or after the Closing, including
obtaining releases of existing liens; (iv) furnish no later than four (4)
Business Days prior to the Closing all documentation and other information
required by a Governmental Entity under applicable “know your customer” and
anti-money laundering rules and regulations, including the U.S.A. Patriot Act of
2001, but in each case, solely as relating to the Acquired Subsidiaries to the
extent requested at least nine (9) days prior to the Closing; and (v) assist in
the preparation, execution and delivery of one or more credit agreements, pledge
and security documents and other definitive financing documents as may be
reasonably requested by Buyer. The Sellers hereby consent to the reasonable use
of all of its and the Acquired Subsidiaries’ logos, names, and trademarks in
connection with the Debt Financing; provided, however, that such logos, names
and trademarks are used solely in a manner that is not intended to or reasonably
likely to harm or disparage the Sellers or the reputation or goodwill of the
Sellers or any of their respective products, services, offerings or intellectual
property rights; provided, further, that prior to the Closing Date no financing
sources in connection with the Debt Financing (including any Affiliates thereof)
shall obtain rights in such logos, names or trademarks. Sellers shall, and shall
cause the Acquired Subsidiaries to, use reasonable best efforts to promptly
supplement the Required Information and all other information provided pursuant
to this Section 5.13 to the extent that any such Required Information and all
other information, to the knowledge of Sellers, when taken as a whole, contains
any untrue statement of a material fact or omits to state any material fact
necessary to make the statements made in such Required Information, in light of
the circumstances under which they were made, not materially misleading. Buyer
shall keep Sellers informed on a current basis and in reasonable detail of the
status of its efforts to arrange the Debt Financing and promptly upon request
provide to Sellers copies (including drafts) of any definitive debt financing
agreement and any other material documents relating to the Debt Financing. No
obligations of Sellers, the Acquired Subsidiaries or any of their Subsidiaries
or any of their respective officers, directors, employees, accountants,
consultants, legal counsel, agents and other representatives under any
definitive debt financing agreement executed pursuant to this Section 5.13 shall
be required to be effective until the Closing. In addition, notwithstanding
anything in this Section 5.13 to the contrary, in fulfilling its obligations
pursuant to this Section 5.13, none of Sellers, their Subsidiaries or their
respective officers, directors, employees, accountants, consultants, legal
counsel, agents and other representatives shall be required to (i) pay any
commitment or other fee, provide any security or incur any Liability or
obligation in connection with the Debt Financing or any other financing, (ii)
take or permit the taking of any action that would reasonably be expected to
conflict with, result in any violation or breach of, or default (with or without
lapse of time, or both) under, the Organizational Documents of Sellers or any of
their Subsidiaries, or any applicable Law or material contracts of Sellers or
any of their Subsidiaries, (iii) pass resolutions or consents or approve or
authorize the execution of the Debt Financing or any definitive debt financing
agreements, (iv) provide any cooperation that would unreasonably interfere with
the ongoing operations of the Acquired Business or (v) disclose any information
which is legally privileged. Buyer acknowledges that the information being
provided to it in connection with the Debt Financing is subject to the terms of
Section 5.9 and the Confidentiality Agreement, and none of Sellers or any of
Sellers’ Subsidiaries or Affiliates shall have any liability to Buyer or any
other Person in respect of any financial statements, other financial information
or data or other information provided pursuant to this Section 5.13.

 

 39 

 

 

(b)       Buyer shall, following request by Sellers, immediately reimburse
Sellers for all reasonable and documented out-of-pocket fees, costs and expenses
incurred by Sellers and their Subsidiaries in cooperating with the Debt
Financing (including reasonable attorneys’ fees). Buyer shall indemnify, defend,
and hold harmless the Sellers and the Acquired Subsidiaries (and their
respective Representatives) from and against any and all liabilities, losses,
damages, claims, costs and expenses suffered or incurred by them in connection
with the Debt Financing or any other financing (including the arrangement
thereof) and its assistance to Buyer in connection with the Debt Financing or
any other financing (including the arrangement thereof) and any information
utilized in connection therewith (other than any liabilities, losses, damages,
claims, costs or expenses resulting from any Required Information or other
financial statements provided pursuant to this Section 5.13 by the Sellers or
the Acquired Subsidiaries to Buyer).

 

(c)       With respect to information disclosed to any rating agency (the
“Confidential Rating Agency Information”), Buyer shall (i) inform such rating
agency of the confidential nature of the Confidential Rating Agency Information
and mark any such information provided in writing to such rating agency as
“confidential” and (ii) require such rating agency not to disclose the
Confidential Rating Agency Information to any third party or to specifically
exclude such information in such ratings agency’s ratings report. Buyer shall be
responsible for any breach of this covenant by any such rating agency.
Notwithstanding anything in this Agreement to the contrary, in no event shall
the receipt or availability of any funds or financing (including the Debt
Financing) by or to Buyer or any of its Affiliates or any other financing
transaction be a condition to any of Buyer’s obligations hereunder.

 

5.14        Controlled Substances. All controlled substances and DEA listed
chemicals will be inventoried by Buyer as of the Closing Date and will be
maintained by Buyer or one of its Subsidiaries at Buyer’s or such Subsidiary’s
expense as inventory of the applicable Seller under the authority and control of
the Sellers’ Registrations in accordance with existing Seller-established
security systems and procedures. Such controlled substances and DEA listed
chemicals will be used, added to and distributed from the registered address,
specified by Buyer with Sellers’ consent (not to be unreasonably withheld), in
accordance with the Sellers’ Registrations until the earlier of (x) such date as
the requisite Buyer Registrations are issued to Buyer or one of its Subsidiaries
or (y) the date on which Sellers are permitted to dissolve their legal existence
pursuant to the terms herein. The controlled substances and DEA listed chemicals
will be inventoried and transferred to Buyer or its applicable Subsidiary under
the Buyer Registrations. With respect to transactions entered into with
suppliers and customers, and internal use and transfer of controlled substances,
the internal and external documentation of such transactions and activities,
including recordkeeping, reporting and invoicing, shall be kept in accordance
with the Sellers’ Registrations; provided, however, to the extent permitted
under applicable regulations or guidance, documentation may be issued and
maintained in the name of Buyer or its Subsidiaries. Buyer agrees that, during
the period it or its Subsidiaries are operating using the Powers of Attorney,
all ownership of title, service and invoicing is Buyer’s (or such Subsidiary’s)
sole responsibility and all documents using Sellers’ license or registration
numbers, if required, will disclose that the shipper is “NMC Atlas, L.P. or one
of its subsidiaries under Power of Attorney from [the appropriate Sellers’
organization that holds the license or Registration]” or such other disclosure
as deemed necessary and appropriate by Buyer, provided such disclosure is
approved by the DEA or other applicable Governmental Entity.

 

 40 

 

 

ARTICLE VI
CONDITIONS TO THE PURCHASE AND SALE

 

6.1          Conditions to Each Party’s Obligation to Close. The respective
obligations of each Party to effect the Asset Purchase shall be subject to the
fulfillment (or waiver in a writing signed by the waiving party, to the extent
permissible under applicable Law and provided that such waiver shall only be
effective as to the conditions of the waiving party) at or prior to the Closing
of the following conditions:

 

(a)       no injunction by any court or other tribunal of competent jurisdiction
shall have been entered and shall continue to be in effect and no Law shall have
been adopted that remains in effect, in each case, that prevents, enjoins,
prohibits or makes illegal the consummation of the Asset Purchase; and

 

(b)       any waiting periods applicable to the Asset Purchase under any
Antitrust Laws of the Federal Republic of Germany or the Republic of Austria
have expired or been terminated and/or the relevant approvals under such Laws
have been acquired.

 

6.2          Conditions to Obligation of Sellers to Close. The obligation of
Sellers to sell the Purchased Assets at Closing is further subject to the
fulfillment (or waiver in a writing signed by Sellers, to the extent permissible
under applicable Law) at or prior to the Closing of the following conditions:

 

(a)       the representations and warranties of Buyer contained herein shall be
true and correct in all material respects as of the Agreement Date and as of the
Closing Date as though made on and as of such date (except to the extent such
representations and warranties speak as of an earlier date, in which case, such
representations and warranties shall be true and correct in all material
respects as of such earlier date);

 

(b)       Buyer shall have performed and complied in all material respects with
all covenants required by this Agreement to be performed or complied with by
Buyer prior to Closing;

 

(c)       Buyer shall have delivered to Sellers a certificate, dated the Closing
Date and signed by a duly authorized executive officer (in such officer’s
capacity as such and not individually) of Buyer, certifying to the effect that
the conditions set forth in Section 6.2(a) and Section 6.2(b) have been
satisfied;

 

(d)       Buyer shall have satisfied the Base Purchase Price in accordance with
Section 2.2;

 

(e)       Buyer shall be prepared to deliver, or cause to be delivered, to
Sellers the items set forth in Section 2.7; and

 

(f)       the Sale Order shall have been entered, is not subject to any stay and
is in effect.

 

6.3          Conditions to Obligation of Buyer to Close. The obligation of Buyer
to purchase the Purchased Assets at Closing is further subject to the
fulfillment (or the waiver in a writing signed by Buyer, to the extent
permissible under applicable Law) at or prior to the Closing of the following
conditions:

 

(a)       (i) the representations and warranties contained in Section 3.2 (other
than the second sentence of Section 3.2(a)) shall be true and correct as of the
Agreement Date and as of the Closing Date as though made on and as of such date
(except to the extent such representations and warranties speak as of an earlier
date, in which case, such representations and warranties shall be true and
correct in all respects as of such earlier date) in all respects except for de
minimis inaccuracies and (ii) each of the representations and warranties
contained herein (other than those listed in clause (i)) shall be true and
correct as of the Agreement Date and as of the Closing Date as though made on
and as of such date (except to the extent such representations and warranties
speak as of an earlier date, in which case, such representations and warranties
shall be true and correct in all respects as of such earlier date), interpreted
without giving effect to any Material Adverse Effect or materiality
qualifications or exceptions contained therein, except where all failures of
such representations and warranties to be true and correct, in the aggregate, do
not have, or would not reasonably be expected to have, a Material Adverse
Effect;

 

 41 

 

 

(b)       Sellers shall have performed and complied in all material respects
with all covenants required by this Agreement to be performed or complied with
by them prior to the Closing (which, for the avoidance of doubt, shall not
include Section 5.13 or the transactions referred to in Section 5.8(d));

 

(c)       each Seller shall have delivered to Buyer a certificate, dated the
Closing Date and signed by a duly authorized executive officer (in such
officer’s capacity as such and not individually) of such Seller, certifying to
the effect that the conditions set forth in Section 6.3(a) and Section 6.3(b)
have been satisfied;

 

(d)       Sellers shall be prepared to deliver, or cause to be delivered, to
Buyer all of the items set forth in Section 2.8; provided, however, that (i)
provision of the certifications referenced in Section 2.8(e) shall not be a
condition to Closing and (ii) the sole remedy for failure to provide such
certifications shall be that Buyer shall be entitled to withhold any amount
required to be withheld pursuant to applicable Law;

 

(e)       the Sale Order shall have been entered, is not subject to any stay, is
in effect and has become a Final Order; and

 

(f)       from the date of this Agreement until the Closing, there shall not
have been a Material Adverse Effect.

 

ARTICLE VII
TERMINATION

 

7.1          Termination. Notwithstanding anything in this Agreement to the
contrary, this Agreement may be terminated, and the transactions contemplated
hereby may be abandoned, at any time prior to the Closing, as follows:

 

(a)       by the mutual written consent of Sellers and Buyer;

 

(b)       by either Sellers or Buyer, if the transactions contemplated hereby
(other than the transactions referred to in Section 5.8(d)), including the Asset
Purchase, shall not have been consummated on or prior to 5:00 p.m. New York City
Time, on September 30, 2019 (the “End Date”); provided that, if as of the End
Date any of the conditions set forth in Section 6.1(a) (solely to the extent
such condition has not been satisfied due to an order or injunction arising
under any Antitrust Law) or Section 6.1(b) shall not have been satisfied or
waived, the End Date may be extended on one occasion by either Buyer or Sellers
for a period of up to ninety (90) days by written notice to the other Party, and
such date, as so extended, shall be the End Date; provided further that the
right to terminate this Agreement pursuant to this Section 7.1(b) shall not be
available to a Party if the failure of the transactions contemplated hereby to
be consummated by such date shall be due to the breach by such Party of any
covenant or other agreement of such Party set forth in this Agreement;

 

(c)       by either Sellers or Buyer, if an Order by a Governmental Entity of
competent jurisdiction shall have been issued permanently restraining, enjoining
or otherwise prohibiting the consummation of the transactions contemplated
hereby and such Order shall have become final and nonappealable; provided that
the right to terminate this Agreement pursuant to this Section 7.1(c) shall not
be available to a Party if such Order resulted from, or could have been avoided
but for, the breach by such Party of any covenant or other agreement of such
Party set forth in this Agreement;

 

 42 

 

 

(d)       by Sellers, if Buyer shall have materially breached or there is a
material inaccuracy in any of its representations or warranties, or shall have
materially breached or materially failed to perform any covenants or other
agreements contained in this Agreement, which material breach, material
inaccuracy or material failure to perform (i) if it occurred or was continuing
to occur on the Closing Date, would result in a failure of a condition set forth
in Section 6.2(a) or Section 6.2(b) and (ii) is either not curable or is not
cured by the End Date; provided that the Sellers’ right to terminate this
Agreement pursuant to this Section 7.1(d) shall not be available to Sellers if a
Seller shall have materially breached or there is any material inaccuracy in any
of its representations or warranties, or shall have materially breached or
materially failed to perform any of its covenants or other agreements contained
in this Agreement;

 

(e)       by Buyer, if Sellers shall have materially breached or there is a
material inaccuracy in any of their representations or warranties, or shall have
materially breached or materially failed to perform any of their covenants or
other agreements contained in this Agreement, which material breach, material
inaccuracy or material failure to perform (i) if it occurred or was continuing
to occur on the Closing Date, would result in a failure of a condition set forth
in Section 6.3(a) or Section 6.3(b) and (ii) is either not curable or is not
cured by the End Date; provided that the Buyer’s right to terminate this
Agreement pursuant to this Section 7.1(e) shall not be available to Buyer if
Buyer shall have materially breached or there is any material inaccuracy in any
of its representations or warranties, or shall have materially breached or
materially failed to perform any of its covenants or other agreements contained
in this Agreement;

 

(f)        by Buyer, if, subject to Section 7.1(j), the Sale Order has not been
entered by the Bankruptcy Court by April 30, 2019;

 

(g)       by Buyer, if the Bankruptcy Case is dismissed or converted to a case
under Chapter 7 of the Bankruptcy Code for any reason prior to the Closing Date;

 

(h)       by Buyer, if the Sale Order is modified in any material respect to the
detriment of Buyer without the consent of Buyer, such consent not to be
unreasonably withheld, conditioned or delayed;

 

(i)        by Buyer, if the Bankruptcy Court enters an order pursuant to Section
362 of the Bankruptcy Code lifting or modifying the automatic stay with respect
to any material portion of the Purchased Assets;

 

(j)        by either Sellers or Buyer, if (A) the Bankruptcy Court approves, and
Sellers consummate, an Alternative Transaction or (B) Buyer is not the
Successful Bidder at the Auction; provided that, if Buyer is not the Successful
Bidder at the Auction, but is the Back-Up Bidder, then notwithstanding anything
to the contrary contained herein, (i) Buyer shall not be permitted to terminate
this Agreement pursuant to this Section 7.1(j), Section 7.1(f) or Section 7.1(h)
until the Back-Up Period End Date; provided, further, that Buyer shall not be
permitted to terminate this Agreement pursuant to this Section 7.1(j) if Buyer
is then in breach of the terms of this Agreement, which such breach would give
rise to the failure of a condition set forth in Section 6.2 and cannot be cured
or, if such breach can be cured, has not been cured within twenty (20) days
following delivery of written notice of such breach; or

 

 43 

 

 

(k)       by Sellers, if (i) all of the conditions set forth in Sections 6.1 and
6.3 are satisfied (except for any conditions that by their nature can only be
satisfied on the Closing Date, but subject to satisfaction of such conditions on
the Closing Date or waiver by the Party entitled to waive such conditions in
accordance with the terms thereof), (ii) Sellers have irrevocably confirmed in
writing to Buyer that (A) all of the conditions set forth in Sections 6.1 and
6.2 to Sellers’ obligations have been satisfied or waived (except for any
conditions that by their nature can only be satisfied on the Closing Date, but
subject to the satisfaction of such conditions on the Closing Date or waiver by
the Party entitled to waive such conditions in accordance with the terms
thereof), and (B) they are ready, willing and able to take the actions within
their control to cause the Closing to occur, and (iii) Buyer fails to consummate
the transactions contemplated by this Agreement, on the terms and subject to the
conditions set forth in this Agreement, within five (5) Business Days (time
being of the essence) following delivery of the confirmation by Sellers required
by clause (ii) of this Section 7.1(k); provided, however, that (A) the
confirmation required by clause (ii) of this Section 7.1(k) shall not be
delivered to Buyer until the date on or after April 29, 2019 that is the third
Business Day following satisfaction or waiver of all conditions to the Parties’
obligations set forth in ARTICLE VI (except for any conditions that by their
nature can only be satisfied on the Closing Date, but subject to satisfaction of
such conditions on the Closing Date or waiver by the Party entitled to waive
such conditions in accordance with the terms thereof), and if it is delivered
prior to such date, the delivery date shall be deemed to be the third Business
Day on or after April 29, 2019 following satisfaction or waiver of all
conditions as set forth above and (B) for the avoidance of doubt, Sellers shall
not be entitled to terminate this Agreement or retain the Good Faith Deposit as
a result of the Closing not occurring prior to May 9, 2019.

 

7.2          Effect of Termination. In the event of termination of this
Agreement pursuant to Section 7.1, this Agreement shall terminate (except that
the Confidentiality Agreement, Section 2.3, the last sentence of Section 5.8(d),
Section 5.13(b), this Section 7.2, Section 7.3, and ARTICLE VIII shall survive
any termination), and there shall be no other Liability on the part of Sellers
or Buyer to the other Party, other than as set forth in Section 2.3; provided
that nothing herein shall relieve any Party from Liability for a Willful Breach
of its covenants or agreements set forth in this Agreement prior to such
termination or relieve Buyer from Liability for any Willful Breach of its
obligations to consummate the transactions contemplated hereby, in which case,
the aggrieved Party shall be entitled to all rights and remedies available at
law or in equity. In the event of termination of this Agreement, and regardless
of the reason for the termination, the Confidentiality Agreement shall continue
in full force and effect in accordance with its terms and any such termination
shall not amend, modify, release, waive or otherwise limit any rights or
obligations under the Confidentiality Agreement.

 

7.3          Break-Up Fee; Expense Reimbursement.

 

(a)       Sellers acknowledge (i) that Buyer has made a substantial investment
in time and incurred substantial out-of-pocket expenses in connection with the
negotiation and execution of this Agreement, its due diligence with respect to
the Purchased Assets, and its efforts to consummate the transactions
contemplated hereby, and (ii) that Buyer’s efforts have substantially benefited
Sellers and will benefit Sellers and will benefit the bankruptcy estate of
Sellers through the submission of the offer reflected in this Agreement which
will serve as a minimum bid on which other potentially interested bidders can
rely. Therefore, as compensation for entering into this Agreement, taking action
to attempt to consummate the transactions contemplated hereby and incurring the
costs and expenses related thereto and other losses and damages, including
foregoing other opportunities, subject to limitations set forth in the Bidding
Procedures, Sellers agree, jointly and severally, to pay to Buyer the Expense
Reimbursement, plus an amount equal to six million seven hundred sixty thousand
dollars ($6,760,000.00) (the “Break-Up Fee”) promptly following (a) this
Agreement being validly terminated by Buyer or Sellers pursuant to Section
7.1(j) and (b) Sellers receiving the cash consideration in connection with the
closing of the Alternative Transaction.

 

 44 

 

 

7.4          Return of Good Faith Deposit. In the event that this Agreement is
validly terminated pursuant to Section 7.1(a), 7.1(b), 7.1(c), 7.1(e), 7.1(f),
7.1(g), 7.1(h), 7.1(i), or 7.1(j), the Good Faith Deposit Escrow Holder shall
disburse to Buyer any amounts held in the Good Faith Deposit Escrow pursuant to
the Bidding Procedures.

 

ARTICLE VIII
MISCELLANEOUS

 

8.1          No Survival. The representations, warranties, covenants and
agreements in this Agreement or in any instrument delivered pursuant to this
Agreement shall not survive the Closing and shall be extinguished by the Closing
and the consummation of the transactions contemplated hereby, except for
covenants and agreements that, by their terms, contemplate performance after, or
otherwise expressly by their terms survive, the Closing.

 

8.2          Expenses. Except as otherwise provided in this Agreement, whether
or not the Asset Purchase is consummated, all costs and expenses incurred in
connection with the Asset Purchase, this Agreement and the transactions
contemplated hereby shall be paid by the Party incurring or required to incur
such expenses; provided that Buyer shall pay all filing fees required under the
HSR Act and all fees and expenses of the Escrow Agent.

 

8.3          Counterparts; Effectiveness. This Agreement may be executed in
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument, and shall become
effective when one or more counterparts have been signed by each of the Parties
and delivered (by telecopy, electronic delivery or otherwise) to the other
Parties. Signatures to this Agreement transmitted by facsimile transmission, by
electronic mail in “portable document format” form, or by any other electronic
means intended to preserve the original graphic and pictorial appearance of a
document, will have the same effect as physical delivery of the paper document
bearing the original signature.

 

8.4          Governing Law; Jurisdiction.

 

(a)       This Agreement, and all claims or causes of action (whether at Law, in
contract, in tort or otherwise) that may be based upon, arise out of or relate
to this Agreement or the negotiation, execution or performance hereof, shall be
governed by and construed in accordance with the laws of the State of New York,
without giving effect to any choice or conflict of law provision or rule
(whether of the State of New York or any other jurisdiction) that would cause
the application of the laws of any jurisdiction other than the State of New
York.

 

(b)       All Proceedings arising out of or relating to this Agreement,
including the resolution of any and all disputes hereunder, shall be heard and
determined in the Bankruptcy Court, and the Parties irrevocably submit to the
exclusive jurisdiction of the Bankruptcy Court in any such Proceeding and
irrevocably waive the defense of an inconvenient forum to the maintenance of any
such Proceeding. The Parties consent to service of process by mail (in
accordance with Section 8.7) or any other manner permitted by law.

 

 45 

 

 

8.5          Remedies.

 

(a)       The Parties agree and acknowledge that if any of the provisions of
this Agreement were not performed in accordance with their specific terms or
were otherwise breached, irreparable damage would occur, no adequate remedy at
law would exist and damages would be difficult to determine, and accordingly (i)
each of the Parties shall be entitled to, and may seek in the alternative, such
remedies as are available at law and in equity, and (ii) (A) except as otherwise
provided in Section 8.5(b) and Section 8.5(c), the Parties shall be entitled to
an injunction or injunctions to prevent breaches of this Agreement and shall be
entitled to specific performance of the terms hereof, in each case, in the
Bankruptcy Court (as set forth in Section 8.4(b)), this being in addition to any
other remedy to which they are entitled at law or in equity, (B) the Parties
waive any requirement for the securing or posting of any bond in connection with
the obtaining of any specific performance or injunctive relief and (C) the
Parties agree, in any action for specific performance, that there is no adequate
remedy at law. In circumstances where Buyer is obligated to consummate the Asset
Purchase and the Asset Purchase has not been consummated, Buyer expressly
acknowledges and agrees that Sellers shall have suffered irreparable harm, that
monetary damages will be inadequate to compensate Sellers, and that Sellers
shall be entitled (in addition to any other remedy that may be available to them
whether in law or equity, including monetary damages) to enforce specifically
Buyer’s obligations to consummate the Asset Purchase. Sellers’ pursuit of
specific performance at any time will not be deemed an election of remedies or
waiver of the right to pursue any other right or remedy to which Sellers may be
entitled. In no event shall the Parties be entitled to receive both a grant of
specific performance of the consummation of the Asset Purchase pursuant to this
Section 8.5 and monetary damages to which it is entitled pursuant to this
Agreement with respect to termination of this Agreement. For the avoidance of
doubt, the Parties shall be entitled to seek the remedies provided herein in the
alternative, and not be required to elect their remedies, in any Proceeding
brought to seek redress for the failure of Buyer to consummate the Asset
Purchase pursuant to this Agreement.

 

(b)       In the event of any breach prior to the Closing by Sellers of any of
Sellers’ agreements, representations, or warranties contained herein or in the
Bidding Procedures Order or the Sale Order, including any Willful Breach,
Buyer’s sole and exclusive remedies shall be (i) to exercise Buyer’s rights to
terminate this Agreement pursuant to ARTICLE VII, in accordance with the terms
of such ARTICLE VII, (ii) the return of the Good Faith Deposit as provided in
Section 2.3, and (iii) to the Break-Up Fee or the Expense Reimbursement, as
applicable, if earned in accordance with Section 7.3, and Buyer shall not have
any further cause of action for damages, specific performance, or any other
legal or equitable relief against Sellers with respect thereto.

 

(c)       In the event of any breach prior to the Closing by Buyer of any of
Buyer’s agreements, representations, or warranties contained herein, including
any Willful Breach, Sellers’ sole and exclusive remedies shall be (i) to
exercise Sellers’ rights to terminate this Agreement pursuant to ARTICLE VII, in
accordance with the terms of such ARTICLE VII, (ii) the payment of the Good
Faith Deposit as provided in Section 2.3, and (iii) to enforce any provision of
this Agreement pursuant to clause (ii) of Section 8.5(a) and the two sentences
that immediately follow such clause (and, in the case of a Willful Breach of
this Agreement by Buyer, to enforce any provision of this Agreement pursuant to
any provision of Section 8.5(a)).

 

8.6          WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES
ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREBY.

 

8.7          Notices. All notices and other communications hereunder shall be in
writing and shall be deemed given (a) upon personal delivery to the Party to be
notified; (b) when received when sent by email or facsimile by the Party to be
notified; provided that notice given by email or facsimile shall not be
effective unless either (i) a duplicate copy of such email or fax notice is
promptly given by one of the other methods described in this Section 8.7 or (ii)
the receiving Party delivers a written confirmation of receipt for such notice
either by email or fax or any other method described in this Section 8.7; or
(c) when delivered by a courier (with confirmation of delivery); in each case to
the Party to be notified at the following address:

 

 46 

 

 

To Buyer:

 

c/o New Mountain Capital, L.L.C. 

787 Seventh Avenue, 49th Floor 

New York, New York 10019 

Attention: Andre Moura; Joe Walker 

Email: AMoura@newmountaincapital.com; JWalker@newmountaincapital.com

 

with a copy (which shall not constitute notice) to:

 

Ropes & Gray LLP 

1211 Avenue of the Americas 

New York, New York 10036 

Attention: John E. Sorkin; Robb Tretter; Matthew Roose 

Email: john.sorkin@ropesgray.com; robb.tretter@ropesgray.com;

Matthew.Roose@ropesgray.com

 

To Sellers:

 

Aceto Corporation

4 Tri Harbor Ct.

Port Washington, NY 11050

Attention: Steven S. Rogers, Chief Legal Officer

Facsimile: (516) 478-9857

Email: srogers@aceto.com

 

with a copy (which shall not constitute notice) to:

 

Lowenstein Sandler LLP

1251 Avenue of the Americas

New York, New York 10020

Facsimile:     (973) 597-2507

Attention:     Steven E. Siesser, Esq.

Peter H. Ehrenberg, Esq.

Email:ssiesser@lowenstein.com

pehrenberg@lowenstein.com

 

or to such other address as any Party shall specify by written notice so given,
and such notice shall be deemed to have been delivered as of the date so
telecommunicated or personally delivered. Any Party may notify any other Party
of any changes to the address or any of the other details specified in this
Section 8.7; provided that such notification shall only be effective on the date
specified in such notice or five (5) Business Days after the notice is given,
whichever is later. Rejection or other refusal to accept or the inability to
deliver because of changed address of which no notice was given shall be deemed
to be receipt of the notice as of the date of such rejection, refusal or
inability to deliver.

 

 47 

 

 

8.8          Assignment; Binding Effect. Neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned or delegated by any
of the Parties without the prior written consent of the other Parties. Subject
to the first sentence of this Section 8.8, this Agreement shall be binding upon
and shall inure to the benefit of the Parties and their respective successors
and assigns. Any purported assignment not permitted under this Section 8.8 shall
be null and void. Notwithstanding anything in this Section 8.8 to the contrary,
Buyer may, without any required consent from any other Party, assign or transfer
this Agreement or any of its rights or obligations hereunder (a) to any of its
Affiliates, (b) to any acquirer of all or substantially all of the business or
assets of the Acquired Business or Buyer after the Closing or (c) as a
collateral assignment to its or its Affiliates lenders in connection with any
debt financing arrangements of Buyer or its Affiliates; provided, that no such
assignment shall relieve Buyer of any Liability or obligation hereunder until
such Liability or obligation has been performed.

 

8.9          Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement in any other jurisdiction. If any provision of this Agreement is so
broad as to be unenforceable, such provision shall be interpreted to be only so
broad as is enforceable.

 

8.10         Entire Agreement. This Agreement together with the exhibits hereto,
schedules hereto and the Confidentiality Agreement constitute the entire
agreement, and supersede all other prior agreements and understandings, both
written and oral, between the Parties, or any of them, with respect to the
subject matter hereof and thereof, and this Agreement is not intended to grant
standing to any Person other than the Parties. If the Parties or any of their
Affiliates are required by Law to enter into any local transfer (or similar)
agreements to effect the transfer of any share certificates as contemplated by
Section 2.8(h) (each, a “Local Transfer Agreement”), the Parties agree that such
Local Transfer Agreements shall serve purely to effect the legal transfer of
such shares and shall not expand or limit the rights and obligations of the
Parties beyond those provided for in this Agreement. In furtherance of the
foregoing, no Local Transfer Agreement shall provide for any additional rights
or obligations of the Parties or their respective Affiliates that are not
provided for in this Agreement. In the event of any conflict between the terms
of this Agreement and any Local Transfer Agreement, the Parties agree and
acknowledge that the terms of this Agreement shall control.

 

8.11         Amendments; Waivers. Any provision of this Agreement may be amended
or waived if, and only if, such amendment or waiver is in writing and signed, in
the case of an amendment, by Sellers and Buyer or, in the case of a waiver, by
the Party against whom the waiver is to be effective. Notwithstanding the
foregoing, no failure or delay by any Party in exercising any right hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise
thereof preclude any other or further exercise of any other right hereunder.

 

8.12         Headings. Headings of the Articles and Sections of this Agreement
are for convenience of the Parties only and shall be given no substantive or
interpretive effect whatsoever. The table of contents to this Agreement is for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

 

8.13         No Third-Party Beneficiaries. Each of Sellers and Buyer agree that,
except to the extent expressly provided in this Agreement (a) its
representations, warranties, covenants and agreements set forth herein are
solely for the benefit of the other Parties, in accordance with and subject to
the terms of this Agreement, and (b) this Agreement is not intended to, and does
not, confer upon any Person other than the Parties any rights or remedies
hereunder, including the right to rely upon the representations and warranties
set forth herein.

 

 48 

 

 

8.14        Interpretation. When a reference is made in this Agreement to an
Article or Section, such reference shall be to an Article or Section of this
Agreement unless otherwise indicated. Whenever the words “include,” “includes”
or “including” are used in this Agreement, they shall be deemed to be followed
by the words “without limitation.” The words “hereof,” “herein” and “hereunder”
and words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement,
unless the context otherwise requires. The word “or” shall not be deemed to be
exclusive. The word “extent” and the phrase “to the extent” when used in this
Agreement shall mean the degree to which a subject or other thing extends, and
such word or phrase shall not mean simply “if.” All terms defined in this
Agreement shall have the defined meanings when used in any certificate or other
document made or delivered pursuant thereto unless otherwise defined therein.
The definitions contained in this Agreement are applicable to the singular as
well as the plural forms of such terms and to the masculine as well as to the
feminine and neuter genders of such terms. References in this Agreement to
specific laws or to specific provisions of laws shall include all rules and
regulations promulgated thereunder. Each of the Parties has participated in the
drafting and negotiation of this Agreement. If an ambiguity or question of
intent or interpretation arises, this Agreement must be construed as if it is
drafted by all the Parties, and no presumption or burden of proof shall arise
favoring or disfavoring any Party by virtue of authorship of any of the
provisions of this Agreement.

 

8.15        Non-Recourse. Notwithstanding anything herein to the contrary, no
director, manager, officer, agent or representative of, Affiliate (or director,
manager, officer, agent or representative of an Affiliate) of, or direct or
indirect equity owner in, any Sellers shall have any personal liability to
either Buyer or any other Person as a result of the breach of any
representation, warranty, covenant, agreement or obligation of Sellers in this
Agreement, and no director, manager, officer, agent or representative of,
Affiliate (or director, manager, officer, agent or representative of an
Affiliate) of, or direct or indirect equity owner in, Buyer shall have any
personal liability to Sellers or any other Person as a result of the breach of
any representation, warranty, covenant, agreement or obligation of Buyer in this
Agreement.

 

8.16        Definitions.

 

(a)       Certain Specified Definitions. As used in this Agreement:

 

“Accounting Firm” means an accounting firm of national reputation mutually
acceptable to Buyer and Sellers, with no existing relationship with either Buyer
or Sellers.

 

“Accounting Principles” means GAAP applied using the same accounting methods,
practices, principles, policies and procedures, with consistent classifications,
judgments and valuation and estimation methodologies that were used in the
preparation of the Most Recent Balance Sheet and the Illustrative Calculation,
subject to the modifications and limitations set forth on Section 8.16(a) of the
Sellers Disclosure Schedule. For the avoidance of doubt, all intercompany
accounts payable and intercompany accounts receivable shall be excluded from the
Illustrative Calculation and the definition of “Net Current Assets.”

 

“Accounts Receivable” means all third party accounts receivable and other rights
to payment of Sellers or the Acquired Subsidiaries, and the full benefit of all
security for such accounts receivable or rights to payment, including all
accounts receivable in respect of goods shipped or products sold or services
rendered to customers by Sellers or the Acquired Subsidiaries, any other
miscellaneous accounts receivable of Sellers or the Acquired Subsidiaries, and
any claim, remedy or other right of Sellers or the Acquired Subsidiaries related
to any of the foregoing, in each case derived primarily from the operation of
the Acquired Business, as reflected in the Closing Statement prepared in
accordance with the Accounting Principles and consistent with the Illustrative
Calculation.

 

 49 

 

 

“Accrued Liabilities” means, without duplication, any Liabilities of the
Acquired Business for: (i) deferred income (including any profit sharing
arrangements); (ii) accrued payroll (including, for the avoidance of any doubt,
both the employee and employer portions of accrued payroll Taxes, Assumed Plan
contributions and premium payments and unemployment contributions); (iii)
accrued (to the extent not paid by Sellers) and unused vacation and paid time
off (“PTO”) to which the employees of the Acquired Business are entitled
pursuant to the PTO policies of Sellers applicable to such employees immediately
prior to the Closing Date; (iv) retention bonus and key employee incentive
obligations, severance obligations, enhanced executive severance arrangements
and change of control payments; (v) any liabilities in connection with product
returns, rebates, credits and related claims and any rights under or pursuant to
any and all warranties, representations and guarantees made by suppliers,
manufacturers and contractors relating to products sold, or services provided,
to each Seller; (vi) unearned revenue; (vii) accrued and unpaid property, public
utility commission and sales Taxes of Sellers attributable under the principles
of Section 5.8(c) to periods (or portions thereof) ending on or before the
Closing Date (as determined in accordance with the past practices of the
relevant Seller and reduced (but not below zero) by refunds, credits or other
receivables (including VAT receivable) in respect of such Taxes) and (viii)
annual bonuses, annual cash incentives, short-term cash bonuses or commissions,
in each case as reflected in the Closing Statement prepared in accordance with
the Accounting Principles and consistent with the Illustrative Calculation.

 

“Aceto Bermuda” means Aceto Ltd., a company organized under the laws of Bermuda.

 

“Aceto HK” means Aceto (Hong Kong) Ltd., a company organized under the laws of
the Hong Kong Special Administrative Region of the People's Republic of China.

 

“Aceto Shanghai” means Aceto (Shanghai) Ltd.

 

“Acquired Business” means the Chemical Plus Business as conducted by Sellers and
the Acquired Subsidiaries as of the Agreement Date. For the avoidance of doubt,
the Acquired Business excludes the assets and liabilities primarily related to
the Pharma Business.

 

“Acquired Real Property” means the Owned Real Property and Leased Real Property
subject to Assumed Real Property Lease(s).

 

“Acquired Subsidiaries” means, collectively, the Purchased Subsidiaries and the
Subsidiaries of the Purchased Subsidiaries (including, for the avoidance of
doubt, the Joint Venture).

 

“Adjustment Time” means 12:01 a.m. New York, New York time on the Closing Date.

 

“Affiliate” means, as to any Person, any other Person which directly or
indirectly controls, or is under common control with, or is controlled by, such
Person. As used in this definition, “control” (including, with its correlative
meanings, “controlled by” and “under common control with”) shall mean
possession, directly or indirectly, of the power to direct or cause the
direction of management or policies (whether through ownership of securities or
partnership or other ownership interests, by contract or otherwise) of such
Person.

 

“Alternative Bid” means a higher or better competing bid, including in
consideration of any sale, transfer, liquidation, or disposition of the Acquired
Business, the Purchased Assets or the Acquired Subsidiaries or of a plan of
reorganization or liquidation with respect to the Acquired Business, the
Purchased Assets or the Acquired Subsidiaries.

 

“AMR” means the State Administration of Market Regulation of the PRC or its
local counterpart.

 

 50 

 

 

“Alternative Transaction” means one or more agreements to sell, transfer,
liquidate or otherwise dispose of any material portion of the Purchased Assets,
either alone or together with any other portion of the Business, in a
transaction or series of transactions (other than in the Ordinary Course of
Business) with one or more Persons, other than Buyer, pursuant to an Alternative
Bid that actually closes.

 

“Ancillary Documents” means the Bill of Sale, the Assignment and Assumption
Agreement, the Assignment of Intellectual Property, the Assignment and
Assumption of Leases, the Escrow Agreement and each other agreement, document or
instrument (other than this Agreement) executed and delivered by the Parties in
connection with the consummation of the transactions contemplated hereby.

 

“Assignment and Assumption Agreement” means an assignment and assumption
agreement in substantially the form of Exhibit B.

 

“Auction” has the meaning specified in the Bidding Procedures Order.

 

“Back-Up Bidder” has the meaning specified in the Bidding Procedures Order.

 

“Back-Up Period End Date” means the earliest of (a) the date upon which an
Alternative Transaction has been consummated following approval by the
Bankruptcy Court, (b) 90 days after entry of the Order of the Bankruptcy Court
pursuant to, inter alia, Section 363 and/or Section 365 of Bankruptcy Code
approving the sale of the Acquired Business (or a substantial portion thereof)
to the Successful Bidder (to the extent the Successful Bidder is not Buyer) and
(c) August 15, 2019.

 

“Bidding Procedures” means the bidding procedures attached as Exhibit 1 to the
Bidding Procedures Order.

 

“Bidding Procedures Order” means the order of the Bankruptcy Court entered on
March 15, 2019 at docket number 142.

 

“Bill of Sale” means a bill of sale in substantially the form attached hereto as
Exhibit C.

 

“Books and Records” means all Tax Returns, books, records, files, invoices,
inventory records, personnel records and Forms I-9, product specifications,
advertising, marketing, and promotional materials, customer lists, cost and
pricing information, supplier lists, business plans, catalogs, customer
literature, quality control records and manuals, research and development files,
records and laboratory books and credit records of customers (including all data
and other information stored on discs, tapes or other media).

 

“Bribery Legislation” means all and any of the following: the Foreign Corrupt
Practices Act of 1977, as amended; the Organization For Economic Co-operation
and Development Convention on Combating Bribery of Foreign Public Officials in
International Business Transactions and related implementing legislation; the
relevant common law or legislation in England and Wales relating to bribery
and/or corruption, including, the Public Bodies Corrupt Practices Act 1889; the
Prevention of Corruption Act 1906 as supplemented by the Prevention of
Corruption Act 1916 and the Anti-Terrorism, Crime and Security Act 2001; the
Bribery Act 2010; the Proceeds of Crime Act 2002; and any applicable
anti-bribery or anti-corruption related provisions in criminal and
anti-competition laws and/or anti-bribery, anti-corruption and/or anti-money
laundering laws of any jurisdiction in which the Acquired Business operates.

 

“Business Day” means any day other than a Saturday, Sunday or any other calendar
day on which commercial banks in New York, New York are authorized or required
by Law to remain closed.

 

 51 

 

 

“Cash” means, as of Adjustment Time, all cash and cash equivalents of the
Acquired Business, as determined in accordance with GAAP using the same
accounting methods, policies, practices and procedures, with consistent
classifications, judgments and estimation methodology, as were used in the
preparation of the Most Recent Balance Sheet, excluding the effects of
transactions on the Closing Date after the Closing outside of the Ordinary
Course of Business. Notwithstanding the foregoing, “Cash” shall include uncashed
and uncleared checks and other deposits or transfers received or deposited for
the accounts of Sellers or the Acquired Subsidiaries, including ACH transactions
and other wire transfers, but shall exclude all outbound ACH and issued but
uncleared checks, in each case, as of the Adjustment Time.

 

“Chemical Plus Business” means the Nutritional Business Sub Segment, Performance
Chemicals, and Pharmaceutical Ingredients.

 

“Claim” has the meaning given that term in Section 101(5) of the Bankruptcy Code
and includes, inter alia, all rights, claims, causes of action, defenses, debts,
demands, damages, offset rights, setoff rights, recoupment rights, obligations
and liabilities of any kind or nature under contract, at law or in equity, known
or unknown, contingent or matured, liquidated or unliquidated, and all rights
and remedies with respect thereto.

 

“Closing Cash Amount” means, as of the Adjustment Time, an amount equal to (a)
Cash of the Acquired Subsidiaries up to an amount equal to $8,000,000 (such
amount, the “Operating Cash Amount”) and (b) (i) Cash of the Acquired
Subsidiaries in excess the Operating Cash Amount multiplied by (ii) 0.90 (such
amount, the “Excess Cash Amount”), in each case, calculated as of the Adjustment
Time and calculated less any amounts of Cash used on the Closing Date after the
Adjustment Time and prior to the Closing to repay Indebtedness of the Acquired
Subsidiaries or Transaction Expenses that would have otherwise been taken into
account in calculating the Purchase Price if unpaid at the Closing.

 

“Closing Debt Amount” means the aggregate amount of Indebtedness of the Acquired
Subsidiaries (including any intercompany Indebtedness owed to the Sellers or
their respective Affiliates (other than another Acquired Subsidiary)) existing
as of the time of the Closing.

 

“Code” means the United States Internal Revenue Code of 1986, as amended.

 

“Comparable Compensation and Benefits” means a base salary, wage rate,
annualized fixed or guaranteed remuneration, and opportunities to receive target
incentive, commission or performance pay (other than equity compensation,
change-in-control, retention, and severance, in each case, other than any such
obligations under the Assumed Plans), as applicable, and other employee benefit
plans and arrangements (including medical insurance plans and other welfare
benefit plans and 401(k) or retirement plans, but excluding any retiree medical
benefits, qualified defined benefit plans, or nonqualified deferred compensation
plans, in each case, other than any such obligations under the Assumed Plans),
that are generally comparable in the aggregate to those provided to the
applicable employee by Sellers and the Acquired Subsidiaries immediately prior
to the Closing Date.

 

“Comparable Position” means, with respect to any employee, a position that is
substantially similar to the type and geographic location of the position held
by such employee immediately prior to the Closing Date.

 

“Contract” means any written contract, note, bond, mortgage, indenture, deed of
trust, license, lease, agreement, arrangement, commitment or other instrument or
obligation that is legally binding.

 

 52 

 

 

“Credit Facility” means that certain Second Amended and Restated Credit
Agreement, dated as of December 21, 2016 (as it may be amended or modified from
time to time), among Parent, as borrower, the other loan parties party thereto,
the lenders party thereto and Wells Fargo Bank, National Association, as
administrative agent.

 

“DEA” means the United States Drug Enforcement Administration.

 

“Environmental Law” means any Law (i) relating to pollution or the protection,
preservation or restoration of the environment (including air, surface water,
groundwater, drinking water supply, surface land, subsurface land, plant and
animal life or any other natural resource), or any exposure to or release of, or
the management of (including the use, storage, recycling, treatment, generation,
transportation, processing, handling, labeling, production or disposal of) any
Regulated Substances or (ii) that regulates, imposes liability (including for
enforcement, investigatory costs, cleanup, removal or response costs, natural
resource damages, contribution, injunctive relief, personal injury or property
damage) or establishes standards of care with respect to any of the foregoing.
The term “Environmental Law” includes any common law or equitable doctrine
(including injunctive relief and tort doctrines such as negligence, nuisance,
trespass and strict liability) that may impose liability or obligations for
injuries or damages due to or threatened as a result of the presence of,
exposure to, or ingestion of, any Regulated Substance.

 

“Environmental Permit” means any permit, certificate, registration, notice,
approval, identification number, license or other authorization required under
any applicable Environmental Law.

 

“EPA” means the United States Environmental Protection Agency.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

 

“ERISA Affiliate” means, with respect to any entity, trade or business, any
other entity, trade or business that is a member of a group described in Section
414(b), (c), (m) or (o) of the Code that includes or included the first entity,
trade or business.

 

“Excluded Subsidiaries” means the Subsidiaries of Sellers other than the
Acquired Subsidiaries.

 

“Expense Reimbursement” means the actual out-of-pocket legal, accounting and
other third party advisory or service costs and expenses of Buyer in connection
with the transactions contemplated hereby, in an amount not to exceed two
million dollars ($2,000,000).

 

“FDA” means the U.S. Food and Drug Administration or a successor thereto.

 

“FDCA” means the Federal Food, Drug and Cosmetic Act of 1938, as amended.

 

“FIFRA” means the Federal Insecticide, Fungicide, and Rodenticide Act.

 

“Final Order” means an action taken or Order issued by the applicable
Governmental Entity as to which: (i) no request for stay of the action or Order
is pending, no such stay is in effect, and, if any deadline for filing any such
request is designated by statute or regulation, it is passed, including any
extensions thereof; (ii) no petition for rehearing or reconsideration of the
action or Order, or protest of any kind, is pending before the Governmental
Entity and the time for filing any such petition or protest is passed; (iii) the
Governmental Entity does not have the action or Order under reconsideration or
review on its own motion and the time for such reconsideration or review has
passed; and (iv) the action or Order is not then under judicial review, there is
no notice of appeal or other application for judicial review pending, and the
deadline for filing such notice of appeal or other application for judicial
review has passed, including any extensions thereof.

 

 53 

 

 

“Governmental Entity” means any federal, state, local or foreign governmental
entity, transnational governmental organization or any subdivision, court of
competent jurisdiction, judicial authority, court, tribunal, arbitral,
self-regulatory organization, agency, authority, department, board, bureau,
official or commission or instrumentality, in each case, whether domestic or
foreign.

 

“Human Health” means the business segment of the Sellers historically identified
as “Human Health” and comprised of: (i) finished dosage form generic drugs and
nutraceutical products, including the sale of generic prescription products and
over-the-counter pharmaceutical products to leading wholesalers, chain drug
stores, distributors and mass merchandisers and (ii) the Nutritional Business
Sub Segment.

 

“Illustrative Calculation” means the illustrative calculation set forth in
Section 8.16(b) of the Sellers Disclosure Schedule.

 

“Indebtedness” means, as to any Person, without duplication, as of the date of
determination (i) all obligations of such Person for borrowed money, including
accrued and unpaid interest, and any prepayment fees or penalties, (ii) all
obligations of such Person evidenced by bonds, debentures, notes or similar
instruments, (iii) all lease obligations of such Person capitalized on the Books
and Records of such Person, (iv) all Indebtedness of others secured by a Lien on
property or assets owned or acquired by such Person, whether or not the
Indebtedness secured thereby has been assumed, (v) all letters of credit or
performance bonds issued for the account of such Person, to the extent drawn
upon, and (vi) all guarantees of such Person of any Indebtedness of any other
Person other than a wholly owned subsidiary of such Person.

 

“Intellectual Property” means all intellectual property and similar proprietary
rights existing anywhere in the world associated with (i) patents and patent
applications, including continuations, divisionals, continuations-in-part,
reissues or reexaminations and patents issuing thereon (collectively,
“Patents”), (ii) trademarks, service marks, trade dress, logos, corporate names,
trade names and Internet domain names, together with the goodwill exclusively
associated with any of the foregoing, and all applications and registrations
therefor (collectively, “Marks”), (iii) copyrights (including such rights in
software) and registrations and applications therefor, and works of authorship
(collectively, “Copyrights”), (iv) designs, databases and data compilations, and
(v) trade secrets and other proprietary and confidential information, including
know-how, inventions (whether or not patentable), processes, formulations,
technical data and designs, in each case, excluding any rights in respect of any
of the foregoing that comprise or are protected by Patents (collectively, “Trade
Secrets”); in each case, used for the operation of the Acquired Business.

 

“Intercompany Accounts Receivable” means all accounts receivable and other
rights to payment of any Seller from any Acquired Subsidiary, and the full
benefit of all security for such accounts receivable or rights to payment,
including all accounts receivable in respect of goods shipped or products sold
or services rendered to such Acquired Subsidiary by Sellers, any other
miscellaneous accounts receivable of any Seller from any Acquired Subsidiary,
and any claim, remedy or other right of any Seller from any Acquired Subsidiary
related to any of the foregoing, in each case derived primarily from the
operation of the Acquired Business.

 

“Inventory” means inventories of materials, parts, raw materials, packaging
materials, supplies, spare parts, work-in-process, goods in transit, finished
goods and products, in each case, primarily related to the Acquired Business.

 

 54 

 

 

“Joint Venture” means Canegrass LLC, a Delaware limited liability company.

 

“knowledge” means (i) with respect to Buyer, the actual knowledge, after due
inquiry, of the individuals listed in Section 8.16(c) of the Buyer Disclosure
Schedule, and (ii) with respect to Sellers, the actual knowledge, after due
inquiry, of the individuals listed on Section 8.16(d) of the Sellers Disclosure
Schedule.

 

“Leased Real Property” means real property leased by, licensed to or otherwise
used or occupied (but not owned) by one or more Seller or any Acquired
Subsidiary (other than the Joint Venture) with respect to the Acquired Business.

 

“Liability” means any debt, loss, Claim, damage, demand, fine, judgment,
penalty, liability or obligation (whether direct or indirect, known or unknown,
absolute or contingent, asserted or unasserted, accrued or unaccrued, matured or
unmatured, determined or determinable, liquidated or unliquidated, or due or to
become due, and whether in contract, tort, strict liability, successor liability
or otherwise), and including all costs and expenses relating thereto (including
fees, discounts and expenses of legal counsel, experts, engineers and
consultants and costs of investigations).

 

“Lien” means any “Interest” as that term is used in Section 363(f) of the
Bankruptcy Code, lien (including any mechanics lien), encumbrance, pledge,
mortgage, indenture, deed of trust, security interest, pledge, hypothecation,
claim, lease, charge, escrow, option, right of first offer, right of first
refusal, preemptive right, easement, servitude, reservation, covenant,
encroachment, right of use, right of way, security agreement or other similar
agreement, arrangement, contract, commitment, understanding or obligation
(whether written or oral and whether or not relating in any way to credit or the
borrowing of money) of any kind with respect to any Person, or any proxy, voting
trust or agreement, transfer restriction under any shareholder or similar
agreement or encumbrance or any other right of a third party in respect of an
asset of such Person.

 

“Material Adverse Effect” means, with respect to Parent (but solely with respect
to the Acquired Business), NY Agri and the Acquired Subsidiaries, any change,
effect, event, occurrence or development that has had, or would reasonably be
expected to have, individually or in the aggregate, a material adverse effect on
the business, operations or financial condition of Sellers and the Acquired
Subsidiaries, taken as a whole and primarily in respect of the Acquired
Business, excluding, however, the impact of (i) the filing of the Bankruptcy
Case or operating in bankruptcy, (ii) any changes or developments in domestic,
foreign or global markets or domestic, foreign or global economic conditions
generally, including (A) any changes or developments in or affecting the
domestic or any foreign securities, equity, credit or financial markets and the
industry in which Sellers or Acquired Subsidiaries are engaged or (B) any
changes or developments in or affecting domestic or any foreign interest or
exchange rates and the industry in which Sellers or Acquired Subsidiaries are
engaged, (iii) changes in GAAP or any official interpretation or enforcement
thereof, (iv) changes in Law or any changes or developments in the official
interpretation or enforcement thereof by Governmental Entities, (v) changes in
domestic, foreign or global political conditions (including the outbreak or
escalation of war, military actions, or acts of terrorism), including any
worsening of such conditions threatened or existing on the Agreement Date, (vi)
changes or developments in the business conditions or regulatory conditions
affecting the industries in which the Acquired Business operates, (vii) the
announcement or the existence of, compliance with or performance under, this
Agreement or the transactions contemplated hereby (including the impact thereof
on the relationships, contractual or otherwise, of Sellers or any Acquired
Subsidiary with employees, labor unions, financing sources, customers, suppliers
or partners), (viii) weather conditions or other acts of God (including storms,
earthquakes, tornados, floods or other natural disasters), (ix) a decline in the
trading price or trading volume of Parent’s common stock or any change in the
ratings or ratings outlook for Parent (provided that the underlying causes
thereof may be considered in determining whether a Material Adverse Effect has
occurred if not otherwise excluded hereunder), (x) the failure to meet any
projections guidance, budgets, forecasts or estimates (provided that the
underlying causes thereof may be considered in determining whether a Material
Adverse Effect has occurred if not otherwise excluded hereunder), (xi) taken or
omitted to be taken by a Seller or any Acquired Subsidiary at the written
request of Buyer or that is not prohibited by this Agreement, (xii) any
Proceeding threatened, made or brought by any of the current or former
shareholders of a Seller (or on their behalf or on behalf of such Seller)
against such Seller or any of their respective directors, officers or employees
arising out of this Agreement or the transactions contemplated hereby, (xiii)
any Proceeding threatened, made or brought against a Seller for breach of a
Material Contract in connection with the collection of payment due thereunder
(whether alone or with other claims) or any modification of credit, cash on
delivery or similar terms of a Material Contract, (xiv) the failure to obtain
any approvals or consents from any Governmental Entity in connection with the
transactions contemplated hereby, and (xv) changes in legislation or Law that
directly or indirectly affect the purchasing or selling of products or services
sold or provided by Sellers and the Acquired Subsidiaries; except, with respect
to clauses (ii), (iv), (vi), (viii) and (xv), to the extent that such impact is
disproportionately adverse to Sellers and the Acquired Subsidiaries, taken as a
whole and primarily in respect of the Acquired Business, relative to others in
the industry or industries in which the Acquired Business operates.

 

 55 

 

 

“MOFCOM” means the Ministry of Commerce of the PRC and the local counterpart.

 

“Net Current Assets” means (x) the sum of Inventory, Accounts Receivable and
Purchased Deposits and other current assets of the Acquired Subsidiaries as set
forth on the Illustrative Calculation minus (y) the sum of Accounts Payable,
Accrued Liabilities (other than the liabilities described in clause (iv) of the
definition of Accrued Liabilities) and other current liabilities of the Acquired
Subsidiaries as set forth on the Illustrative Calculation and, without
duplication of any items included in Accrued Liabilities, accrued and unpaid Tax
Liabilities of the Acquired Subsidiaries (limited to 30% of such Tax Liabilities
in the case of the Joint Venture) attributable under the principles of Section
5.8(c), to periods (or portions thereof) ending on or before the Closing Date
(as determined in accordance with the past practices of the relevant Acquired
Subsidiary and reduced (potentially below zero) by any rights to refunds,
credits or other receivables (including VAT receivables) in respect of such
Taxes), as calculated in a manner consistent with the Illustrative Calculation
and the Accounting Principles as of the Adjustment Time (other than, in the case
of Tax liabilities and Tax assets as contemplated by Section 5.8(c)). For the
avoidance of doubt, none of (i) Cash, (ii) Cure Costs, (iii) time deposits, (iv)
Transfer Taxes for which Buyer is responsible pursuant to Section 5.8(b) or (v)
Applicable EIT liability shall be included in the calculation of Net Current
Assets.

 

“Net Debt” means the Closing Debt Amount plus the Transaction Expenses minus the
Closing Cash Amount.

 

“Non-U.S. Seller Benefit Plan” means each Seller Benefit Plan that is maintained
outside the jurisdiction of the United States.

 

“Nutritional Business Sub Segment” means the supply of ingredients and raw
materials used in the production of food, nutritional and packaged dietary
supplements, including vitamins, supplements, botanical extracts, amino acids,
minerals, iron compounds and biochemicals used in pharmaceutical and nutritional
preparations.

 

“Order” means any order, injunction, judgment, decree, ruling, writ, assessment
or arbitration award of a Governmental Entity.

 

 56 

 

 

“Ordinary Course of Business” means the ordinary and usual course of day-to-day
operations of the Acquired Business (including acts and omissions of a Seller in
the ordinary and usual course) through the date hereof, consistent with past
practice or operations in or pending a bankruptcy.

 

“Organizational Documents” means (a) the articles or certificates of
incorporation and the by-laws of a corporation, (b) the partnership agreement
and any statement of partnership of a general partnership, (c) the limited
partnership agreement and the certificate of limited partnership of a limited
partnership, (d) the operating or limited liability company agreement and the
certificate of formation of a limited liability company, (e) any charter, joint
venture agreement or similar document adopted or filed in connection with the
creation, formation or organization of a Person not described in clauses (a)
through (d), and (f) any amendment to or equivalent of any of the foregoing.

 

“Owned Real Property” means any real property and interests in real property
owned by a Seller or any Acquired Subsidiary (other than the Joint Venture) and
used primarily for the operation of the Acquired Business, together with all
buildings, structures, fixtures and improvements erected thereon, and any and
all rights, privileges, easements, licenses, hereditaments and other
appurtenances of a Seller or such Acquired Subsidiary relating thereto, but
excluding any leasehold, license or other use or occupancy real property
interest).

 

“Party” or “Parties” means, individually or collectively, Buyer and each Seller.

 

“Performance Chemicals” means the business segment of the Sellers historically
identified as “Performance Chemicals” and consisting of the sourcing and
distribution of specialty chemicals, including the supply to various industrial
segments of chemicals used in the manufacture of plastics, surface coatings,
cosmetics and personal care, textiles, fuels and lubricants, and agricultural
protection products.

 

“Permits” means all material approvals, permits, certificates, qualifications,
authorizations, licenses, franchises, consents, Orders and registrations,
together with all modifications, amendments, supplements and extensions thereof,
of all United States federal, state and local Governmental Entities and any
other Person that are necessary for Sellers to own and operate the Acquired
Business.

 

“Permitted Liens” means (i) any Liens for Taxes not yet due or that are being
contested in good faith by appropriate Proceedings or for which adequate
reserves have been established by a Seller or any Acquired Subsidiary in
accordance with GAAP, (ii) vendors’, mechanics’, materialmen’s, carriers’,
workers’, landlords’, repairmen’s, warehousemen’s, construction and other
similar Liens (A) with respect to Liabilities that are not yet due and payable
or, if due, are not delinquent or (B) that are being contested in good faith by
appropriate Proceedings and for which adequate reserves (based on good faith
estimates of management) have been set aside for the payment thereof or (C)
arising or incurred in the Ordinary Course of Business and which are not,
individually or in the aggregate, material to the operation of the Acquired
Business and do not materially adversely affect the market value or continued
use of the asset encumbered thereby, (iii) Liens imposed or promulgated by
applicable Law or any Governmental Entity with respect to real property,
including zoning, building or similar restrictions but only to the extent that
Sellers and the Acquired Subsidiaries and their respective assets are materially
in compliance with the same, (iv) pledges or deposits in connection with
workers’ compensation, unemployment insurance, and other social security
legislation, (v) Liens relating to intercompany borrowings among a Person and
its wholly owned subsidiaries, (vi) utility easements, minor encroachments,
rights of way, imperfections in title, charges, easements, rights of way
(whether recorded or unrecorded), restrictions, declarations, covenants,
conditions, defects and similar Liens or Claims, but not including any monetary
Liens, that are imposed by any Governmental Entity having jurisdiction thereon
or otherwise are typical for the applicable property type and locality as do not
individually or in the aggregate materially interfere with the present occupancy
under the real property interest, or the use or market value of the real
property interest, or materially impair the operation of the Acquired Business,
(vii) Intellectual Property licenses, (viii) Liens to be released at or prior to
Closing, (ix) Liens that do not have and would not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect and (x) liens
consented to in writing by Buyer; provided that, in each case of clause (i)
through (ix) above, such Lien shall only be a Permitted Lien if it cannot be
satisfied solely through the payment of money or otherwise removed, discharged,
released or transferred, as the case may be, pursuant to Section 363(f) of the
Bankruptcy Code or otherwise.

 

 57 

 

 

“Person” means any individual, corporation, partnership, joint venture, limited
liability company, association, joint-stock company, trust, unincorporated
organization, Governmental Entity or other entity.

 

“Pharma Business” means Human Health, excluding the Nutritional Business Sub
Segment.

 

“Pharmaceutical Ingredients” means the business segment of the Sellers
historically identified as “Pharmaceutical Ingredients” and comprised of the
following two product groups: Active Pharmaceutical Ingredients (APIs) and
Pharmaceutical Intermediates.

 

“PRC” means the People’s Republic of China, excluding Hong Kong and Macao
Special Administration Regions and Taiwan area, only for the purpose of this
Agreement.

 

“PRC Transfer Approvals” means any filing required to be made with, or consent
or approval required to be obtained from, any Governmental Entity in the PRC to
effectively transfer the equity interests of Aceto Shanghai to Buyer or its
designee pursuant to this Agreement, including the filing of any amendment with
the AMR, MOFCOM and the SAFE.

 

“Prepetition Credit Agreement Penalty” means, if determined to be payable
pursuant to Section 2.1(d), and (i) the Closing occurs on or before May 30,
2019, an amount equal to the actual portion of the Waiver Fee (as defined in
Section 2.12(e) of the Credit Facility) that becomes due and payable on April
30, 2019 pursuant to Section 2.12(e) of the Credit Facility, which as of the
date hereof is estimated to be $4,100,000 (the “Initial Penalty”) or (ii) the
Closing occurs after May 30, 2019, an amount equal to the Initial Penalty plus
the remaining portion of the Waiver Fee that becomes due and payable on May 31,
2019 pursuant to Section 2.12(e) of the Credit Facility.

 

“Proceeding” means any action, suit, claim, hearing, arbitration, litigation or
other proceeding, in each case, by or before any Governmental Entity.

 

“Purchased Deposits” means all deposits (including customer deposits and
security deposits for rent (including such deposits made by a Seller, as lessee,
or to a Seller, as lessor, in connection with the Assumed Real Property
Lease(s)) and prepaid charges and expenses of, and advance payments made by a
Seller, in each case, primarily for the operation of the Acquired Business and
reflected in the Closing Statement.

 

“Purchased Subsidiaries” means Aceto (Shanghai) Ltd., Aceto Bermuda, Aceto
Agricultural Chemicals Corp Mx S. de R.L. de CV, Aceto Agricultural Chemicals
Corporation Ltd., the Joint Venture and Aceto HK; provided, however, that Aceto
HK shall not be a Purchased Subsidiary (but will be an Acquired Subsidiary) if
NY Agri, at the request of Buyer, transfers to Aceto Bermuda, contemporaneously
with Closing, the one share of capital stock of Aceto HK owned by NY Agri.

 

“Real Property Lease” means any lease, sublease, license or other agreement
under which a Seller or any Acquired Subsidiary (other than the Joint Venture)
leases, subleases, licenses, uses or occupies (in each case whether as landlord,
tenant, sublandlord, subtenant or by other occupancy arrangement), or has the
right to use or occupy, now or in the future, any real property, in each case,
used for the operation of the Acquired Business.

 

 58 

 

 

“Regulated Substances” means pollutants, contaminants, radioactive, hazardous or
toxic substances, compounds or related materials or chemicals, hazardous
materials, solid or hazardous wastes, flammable explosives, radon, radioactive
materials, asbestos, urea formaldehyde foam insulation, polychlorinated
biphenyls, petroleum and petroleum products (including waste petroleum and
petroleum products) as regulated under applicable Environmental Laws.

 

“SAFE” means the State Administration of Foreign Exchange or its local
counterpart.

 

“Sale Hearing” means the hearing conducted by the Bankruptcy Court to approve
the transactions contemplated hereby or a competing transaction.

 

“Sale Motion” means the motion filed by Sellers in the Bankruptcy Case at docket
number 45 pursuant to, inter alia, Sections 363 and 365 of the Bankruptcy Code
to secure entry of the Sale Order by the Bankruptcy Court.

 

“Sale Order” means an Order of the Bankruptcy Court in substantially the form
attached to the Sale Motion or otherwise in a form and substance reasonably
acceptable to Buyer, pursuant to, inter alia, Sections 105, 363 and 365 of the
Bankruptcy Code (i) approving this Agreement and the terms and conditions
hereof, (ii) authorizing and approving, inter alia, the sale of the Purchased
Assets to Buyer on the terms and conditions set forth herein free and clear of
all Liabilities and Liens (other than Permitted Liens), the assignment to Buyer
of, and the assumption by Buyer of, the Assumed Liabilities, and the assignment
to Buyer of, and the assumption by Buyer of, the Buyer Assumed Agreements and
(iii) containing certain findings of facts, including a finding that Buyer is a
good faith purchaser pursuant to Section 363(m) of the Bankruptcy Code.

 

“Seller Benefit Plan” means any material “employee benefit plan” (within the
meaning of Section 3(3) of ERISA) and any other material pension, retirement,
profit-sharing, supplemental retirement or deferred compensation, stock option,
change in control, retention, equity or equity-based compensation, stock
purchase, employee stock ownership, severance pay, employment (including offer
letters), consultancy, vacation, bonus or other incentive plans, medical or
other welfare, retiree medical, vision, dental or other health plans, or life
insurance plan, program, agreement, or arrangement, funded or unfunded, or
insured or self-insured, (i) that is maintained, established, or sponsored by a
Seller or any Acquired Subsidiary for the benefit of any current or former
employee, officer or director of Parent (who are or were primarily employed in
respect of the Acquired Business), NY Agri or any Acquired Subsidiary, or (ii)
to which Parent (in respect of the Acquired Business), NY Agri or any Acquired
Subsidiary contributes or is obligated to contribute or has any material
Liability, other than a Multiemployer Plan and other than any plan or program
maintained by a Governmental Entity to which Parent (in respect of the Acquired
Business), NY Agri or any Acquired Subsidiary contributes pursuant to applicable
Law.

 

“Shanghai Asset Closing Dates” means the dates on which the assignment by Aceto
Shanghai to Buyer (or its designated Affiliate) of any assets or Liabilities of
Aceto Shanghai pursuant to Section 2.10 becomes effective.

 

“Subsidiaries” means, as to any Person, any corporation, partnership,
association, trust or other form of legal entity of which (i) 50% or more of the
voting power of the outstanding voting securities are directly or indirectly
owned by such Person or (ii) such Person or any Subsidiary of such Person is a
general partner.

 

 59 

 

 

“Successful Bidder” means the bidder who shall have submitted the highest or
otherwise best bid at the conclusion of the Auction in accordance with the
Bidding Procedures and Bidding Procedures Order.

 

“Tax” or “Taxes” means any and all federal, state, local or foreign taxes
imposed by any Taxing Authority, including all net income, gross receipts,
capital, sales, use, ad valorem, value added, transfer, franchise, profits,
inventory, capital stock, license, withholding, payroll, employment, social
security, unemployment, excise, severance, environmental, stamp, occupation,
premium, and property (real or personal) taxes, including any and all interest,
penalties, additions to tax or additional amounts imposed by any Governmental
Entity with respect thereto.

 

“Tax Return” means any return, declaration, report or similar filing required to
be filed with respect to Taxes, including any information return, claim for
refund, amended return, or declaration of estimated Taxes.

 

“Taxing Authority” means any Governmental Entity responsible for the
administration or the imposition of any Tax.

 

“Transaction Expenses” means, without duplication, the unpaid amount of (i) any
finder’s, broker’s or dealer’s fees incurred by any Acquired Subsidiary in
connection with the Closing as a result of the consummation of the transactions
contemplated by this Agreement (including the Bankruptcy Case) and (ii) any
third party legal, accounting or similar advisor fees and expenses incurred by
any Acquired Subsidiary in connection with the negotiation, execution and
delivery of this Agreement or the consummation of the transactions contemplated
hereby (including the Bankruptcy Case) (except to the extent any such amount is
caused by actions of the Buyer or any of its Affiliates after the Closing Date),
in each case that are to be paid by any Acquired Subsidiary and that have not
yet been paid as of the Closing; provided, that in no event shall “Transaction
Expenses” be deemed to include any fees and expenses to the extent incurred by
or at the direction of Buyer or any of its Affiliates otherwise relating to
Buyer’s or its Affiliates’ financing (including obtaining any consent or waiver
relating thereto) for the transactions contemplated hereby or any other
liabilities or obligations incurred or arranged by or on behalf of Buyer or its
Affiliates in connection with the transactions contemplated hereby (including
any fees payable to any financing institution or the Sellers’ or the Acquired
Subsidiaries’ accountants on behalf of Buyer or its Affiliates).

 

“U.S. Seller Benefit Plan” means, each Seller Benefit Plan that is not a
Non-U.S. Seller Benefit Plan.

 

“VAT” means any value added Tax or similar Tax.

 

“WARN Act” means, collectively, the Worker Adjustment and Retraining
Notification Act of 1988, as amended, and any other similar statutes or
regulations of any jurisdiction relating to any plant closing or mass layoff (or
such similar terms used in such statutes or regulations).

 

“Willful Breach” means, with respect to any representation, warranty, agreement
or covenant, an action or omission where the breaching party knows such action
or omission is a breach of such representation, warranty, agreement or covenant.

 

 60 

 

 

(b)       The following terms are defined elsewhere in this Agreement, as
indicated below: 

 

Defined Term   Section   Defined Term    Section  Accounts Payable   1.3(b)  
Confidentiality Agreement   5.2(c) Aceto Realty   Preamble   Consents   3.3(c)
Adjustment Escrow   10   Costs   5.10 Adjustment Escrow Amount   2.2(b)   Cure
Costs   1.5(a) Agreement   Preamble   Debt Financing   5.13(a) Agreement Date  
Preamble   Deferral Period   2.10(a) Antitrust Laws   3.3(b)   Designated
Parties   1.1(u) Applicable EIT   5.8(b)   EIT   5.8(b) Asset Purchase  
Recitals   End Date   7.1 Assignment and Assumption of Leases   2.8(f)  
Enforceability Exceptions   3.3(a) Assignment of Intellectual Property   2.8(b)
  Escrow Agent   10 Assumed Contracts   1.1(c   Escrow Agreement   2.2(b)
Assumed Equipment Leases   1.1(l)   Estimated Cash Balance   2.4(a) Assumed
Liabilities   1.3   Estimated Net Current Assets   2.4(a) Assumed Plans   1.1(o)
  Estimated Net Debt   2.4(a) Assumed Purchase Orders   1.1(c)   Excluded Assets
  1.2 Assumed Real Property Lease(s)   1.1(d)   Excluded Equipment Leases  
1.2(e) Assumption Deadline   1.5(a)   Excluded Liabilities   1.4 Bankruptcy Case
  Recitals   Excluded Real Property Leases   1.2(d) Bankruptcy Code   Recitals  
Existing NQ Trust   5.3(f) Bankruptcy Court   Recitals   Financial Statements  
3.4 Bankruptcy Court Filings   Article III   GAAP   3.4 Base Purchase Price  
2.1   Good Faith Deposit   2.3 Break-Up Fee   7.3(a)   Good Faith Deposit Escrow
  2.3 Business   Recitals   Good Faith Deposit Escrow Holder   2.3 Business
Employees   5.3(a)   Guarantee   4.9 Buyer   Preamble   Guarantor   4.9 Buyer
Allocation Objection Notice   2.5   HSR Act   3.3(b) Buyer Assumed Agreements  
1.1(l)   IRS   3.7(a) Buyer Benefit Plans   5.3(c)   Law   3.5(a) Buyer
Disclosure Schedule   ARTICLE IV   Laws   3.5(a) Buyer Registrations   2.8(j)  
Local Transfer Agreement   8.10 Buyer Tax Adjustment       Material Contracts  
3.13(a) Objection Notice   2.10(d)   Most Recent Balance Sheet   3.4 Buyer Trust
  5.3(f)   Multiemployer Plan   3.7(c) Cash Balance   2.1(b)   NCIDA   5.8(b)
Closing   2.6   New NQ Trust   5.3(f) Closing Date   2.6   NQ Plan   5.3(f)
Closing Statement   2.4(b)   NY Agri   Preamble Collective Bargaining Agreement
  3.10(a)   Original Agreement   Recitals Confidential Rating Agency      
Parent   Preamble Information   5.13(c)   Parent SEC Disclosures   ARTICLE III

 

 61 

 

  

Defined Term    Section   Defined Term    Section Parent Shanghai Allocation    
  Required Information   5.13(a) Objection Notice   2.10(c)   SEC   ARTICLE III
Permitted Access Parties   5.2(d)   Seller   Preamble Petition Date   Recitals  
Seller Deferred Compensation Plans   3.7(a) PILOT Unwind   1.7   Sellers  
Preamble Port Washington Property   1.7   Sellers Disclosure Schedule   ARTICLE
III Post-Close Filings   5.2(d)   Shanghai APA   2.10(b) Post-Close Proceedings
  5.2(d)   Shanghai Assets   16 Powers of Attorney   2.8(j)   Shortfall   2.4(b)
Products   1.1(f)   Surplus   2.4(b) Purchase Price   2.4(e)   Tax Adjustment  
2.10(d) Purchased Assets   1.1   Transaction Approvals   3.3(b) Purchased
Avoidance Actions   1.1(u)   Transfer Taxes   5.8(b) Registered Intellectual
Property   3.12(a)   Transferable Assets   5.3(f) Registrations   2.8(j)  
Transferred Employees   5.3(a) REPRESENTATIVES   3.18   Unsecured Creditors  
5.2(d)

  

(c)       Other Definitional and Interpretive Matters. Unless otherwise
expressly provided, for purposes of this Agreement, the following rules of
interpretation shall apply:

 

(i)       Calculation of Time Period. When calculating the period of time before
which, within which or following which any act is to be done or step taken
pursuant to this Agreement, the date that is the reference date in calculating
such period shall be excluded. If the last day of such period is a non-Business
Day, the period in question shall end on the next succeeding Business Day.

 

(ii)       Dollars. Any reference in this Agreement to $ shall mean U.S.
dollars.

 

(iii)      Exhibits/Schedules. All Exhibits and Schedules annexed hereto or
referred to herein are hereby incorporated in and made a part of this Agreement
as if set forth in full herein. Any capitalized terms used in any Schedule or
Exhibit but not otherwise defined therein shall be defined as set forth in this
Agreement.

 

8.17         Sellers Disclosure Schedule. The Sellers Disclosure Schedule is
qualified in its entirety by reference to specific provisions of this Agreement
and is not intended to constitute, and shall not be construed as constituting,
representations, warranties and covenants of Sellers, except as and to the
extent expressly provided in this Agreement. Each section or subsection
referenced in the Sellers Disclosure Schedule corresponds to the section or
subsection set forth in this Agreement; provided, however, that any matter set
forth in any section or subsection of the Sellers Disclosure Schedule shall be
deemed to be referred to and incorporated in all other sections or subsections
of the Sellers Disclosure Schedule to which the relevance of such matter is
reasonably apparent on its face to inform Buyer that such information is
relevant to such other section or subsection. The inclusion of any information
or reference in the Sellers Disclosure Schedule shall not be deemed to be an
admission, acknowledgment or representation, in and of itself, that such
information is required by the terms hereof to be disclosed, is material, has
resulted in a Material Adverse Effect, is outside the Ordinary Course of
Business or defines further the meaning of such terms for purposes of this
Agreement. Nothing in this Agreement or in the Sellers Disclosure Schedule
constitutes an admission (i) to any third party of any liability or obligation
of Sellers to any third-party or (ii) that any information disclosed, set forth
or incorporated by reference in the Sellers Disclosure Schedule or in this
Agreement is material or has (or may result in) a Material Adverse Effect.

 

 62 

 

 

8.18         Limitation on Good Faith Deposit Escrow Holder’s Liability. The
Good Faith Deposit Escrow Holder’s responsibilities and liabilities shall be
limited as follows:

 

(a)       The Good Faith Deposit Escrow Holder shall not be responsible for or
be required to enforce any of the terms or conditions of this Agreement or any
other agreement between Sellers and Buyer. The Good Faith Deposit Escrow Holder
shall not be responsible or liable in any manner whatsoever for the performance
by Sellers or Buyer or any other party for their respective obligations under
this Agreement, nor shall the Good Faith Deposit Escrow Holder be responsible or
liable in any manner whatsoever for the failure of the other parties to this
Agreement or of any third party to honor any of the provisions of this
Agreement.

 

(b)       The duties and obligations of the Good Faith Deposit Escrow Holder
shall be limited to and determined solely by the express provisions of this
Agreement and no implied duties or obligations shall be read into this Agreement
against the Good Faith Deposit Escrow Holder. The Good Faith Deposit Escrow
Holder is not bound by and is under no duty to inquire into the terms or
validity of any other agreements or documents, including any agreements which
may be related to, referred to in or deposited with the Good Faith Deposit
Escrow Holder in connection with this Agreement.

 

(c)       The Good Faith Deposit Escrow Holder shall be entitled to rely upon
and shall be protected in acting in reliance upon any instruction, notice,
information, certificate, instrument or other document which is submitted to it
in connection with its duties under this Agreement and which the Good Faith
Deposit Escrow Holder in good faith believes to have been signed or presented by
the proper party or parties. The Good Faith Deposit Escrow Holder shall have no
liability with respect to the form, execution, validity or authenticity thereof.

 

(d)       The Good Faith Deposit Escrow Holder shall not be liable for any act
which the Good Faith Deposit Escrow Holder may do or omit to do hereunder, or
for any mistake of fact or law, or for any error of judgment, or for the
misconduct of any employee, agent or attorney appointed by it, while acting in
good faith, unless caused by or arising from its own willful misconduct.

 

(e)       The Good Faith Deposit Escrow Holder shall be entitled to consult with
counsel of its own selection and the opinion of such counsel shall be full and
complete authorization and protection to the Good Faith Deposit Escrow Holder in
respect of any action taken or omitted by the Good Faith Deposit Escrow Holder
hereunder in good faith and in accordance with the opinion of such counsel.

 

(f)       The Good Faith Deposit Escrow Holder shall have the right at any time
to resign for any reason and be discharged of its duties as Good Faith Deposit
Escrow Holder hereunder by giving written notice of its resignation to the
parties hereto prior to the date specified for such resignation to take effect.
All obligations of the Good Faith Deposit Escrow Holder hereunder shall cease
and terminate on the effective date of its resignation and its sole
responsibility thereafter shall be to hold the Good Faith Deposit, for a period
of no more than thirty (30) calendar days following the effective date of
resignation, at which time:

 

(i)       if a successor holder of the Good Faith Deposit shall have been
appointed, by the mutual consent of Buyer and the Sellers, and written notice
thereof shall have been given to the resigning Good Faith Deposit Escrow Holder
by the parties hereto and such successor holder, then the resigning Good Faith
Deposit Escrow Holder shall deliver the Good Faith Deposit to such successor
holder; or

 

 63 

 

 

(ii)       if a successor holder of the Good Faith Deposit shall not have been
appointed, for any reason whatsoever, the resigning holder of the Good Faith
Deposit shall deliver the Good Faith Deposit to a court of competent
jurisdiction in the county in which the Good Faith Deposit is then being held
and give written notice of the same to the parties hereto.

 

The resigning Good Faith Deposit Holder shall be reimbursed by Buyer and Sellers
for any expenses incurred in connection with its resignation and transfer of the
Good Faith Deposit Holder pursuant to and in accordance with the provisions of
this Section 8.18.

 

(g)       Buyer and Sellers, jointly and severally, agree to indemnify and hold
the Good Faith Deposit Holder harmless from and against any and all liabilities,
causes of action, claims, demands, judgments, damages, costs and expenses
(including reasonable attorneys’ fees and expenses) that may arise out of or in
connection with the Good Faith Deposit Holder’s acceptance of or performance of
its duties and obligations under this Agreement. The Good Faith Deposit Holder
shall be under no duty to institute any suit, or to take any remedial procedures
under this Agreement, or to enter any appearance or in any way defend any suit
in which it may be made a defendant hereunder until it shall be indemnified as
provided above.

 

(h)       If the Good Faith Deposit Holder shall be uncertain as to its duties
or rights hereunder or shall receive instructions with respect to the Good Faith
Deposit which, in its sole discretion, are in conflict either with other
instructions received by it or with any provision of this Agreement, the Good
Faith Deposit Holder shall have the absolute right to suspend all further
performance under this Agreement (except for the safekeeping of the Good Faith
Deposit) until such uncertainty or conflicting instructions have been resolved
to the Good Faith Deposit Holder’s sole satisfaction by final judgment of a
court of competent jurisdiction, joint written instructions from all of the
other parties hereto, or otherwise.

 

(i)       The parties acknowledge that Lowenstein Sandler LLP, as Good Faith
Deposit Holder, has agreed to serve in such capacity as an accommodation to the
parties on the condition that it be allowed to continue to act as legal counsel
to Sellers. Buyer acknowledges that Lowenstein Sandler LLP has acted as legal
counsel to Sellers in connection with this Agreement, the transactions
contemplated hereby and other matters relating thereto and that Lowenstein
Sandler LLP shall continue such representation of Sellers, including with
respect to the Seller’s rights and obligations under this Agreement, and all
other matters. Nothing in this Agreement, nor Lowenstein Sandler LLP’s serving
as Good Faith Deposit Holder hereunder, shall prevent or inhibit Lowenstein
Sandler LLP from continuing to serve as legal counsel to Sellers and Buyer
hereby consents to the continued representation of Sellers by Lowenstein Sandler
LLP as its legal counsel.

 

[SIGNATURE PAGE FOLLOWS]

 

 64 

 

  

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed the
day and year first above written.

 

  BUYER:       NMC ATLAS, L.P.       By: NMC Atlas GP, L.L.C., its general
partner

 

  By: /s/ Joseph Walker      Name: Joseph Walker     Title: Vice President and
Secretary

 

[Signature Page to Asset Purchase Agreement]

 

 
 

  

  SELLERS:       ACETO CORPORATION

 

  By: /s/ William C. Kennally, III      Name: William C. Kennally, III    
Title: Chief Executive Officer and President

 

  ACETO REALTY LLC

 

  By: /s/ William C. Kennally, III      Name: William C. Kennally, III    
Title: Chief Executive Officer

 

  ACETO AGRICULTURAL CHEMICALS CORPORATION

 

  /s/ William C. Kennally, III      Name: William C. Kennally, III     Title:
Authorized Signatory

 

[Signature Page to Asset Purchase Agreement]

 

 
 

 

EXHIBIT A

 

PURCHASE PRICE ALLOCATION CONSTRAINTS

 

·The purchase price allocable to 100% of the shares of Aceto (Shanghai) Ltd.
will be limited to the greater of: (i) 4.21% of the Purchase Price, which
represents Aceto (Shanghai) Ltd.’s percentage of the total gross margin of the
Purchased Assets, or (ii) the book net equity value of Aceto (Shanghai) Ltd. as
of the Closing.

 

·The purchase price allocable to 100% of the shares of Aceto Agricultural
Chemicals Corp Mx S. de R.L. de CV shall not exceed $1.00.

 

 
 

 

EXHIBIT B

 

FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT

 

 
 

 

Agreed Form

 

ASSIGNMENT AND ASSUMPTION AGREEMENT

 

THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (this “Agreement”), dated as of [●],
2019, is made and entered into by and among Aceto Corporation, a New York
corporation (“Parent”), Aceto Realty LLC, a New York limited liability company
(“Aceto Realty”), and Aceto Agricultural Chemicals Corporation, a New York
corporation (“NY Agri” and together with Parent and Aceto Realty, “Sellers” and
each, a “Seller”), each a debtor and debtor in possession under Case No.
19-13448 pending in the United States Bankruptcy Court for the District of New
Jersey, on the one hand, and NMC Atlas, L.P., a Delaware limited partnership
(“Buyer”), on the other hand. As used in this Agreement, “Party” or “Parties”
means, individually or collectively, Sellers and Buyer. Unless otherwise defined
herein, all capitalized terms used in this Agreement shall have the meanings
ascribed to such terms in that certain Amended and Restated Asset Purchase
Agreement dated as of April [●], 2019 (as it may be amended from time to time,
the “Purchase Agreement”), by and among Sellers and Buyer.

 

WHEREAS, concurrently with the execution and delivery of this Agreement, Sellers
and Buyer are consummating the transactions contemplated by the Purchase
Agreement.

 

NOW, THEREFORE, in consideration of the premises and the mutual promises herein
made, and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, and as contemplated by the Purchase Agreement,
Sellers and Buyer hereby agree as follows:

 

1.             Assignment. Each Seller hereby sells, transfers, assigns, conveys
and delivers to Buyer, free and clear of all Liens, sales, transfer or
transaction taxes of any kind whatsoever, all of such Seller’s right, title and
interest in, to or under the Purchased Assets. Notwithstanding the foregoing,
the Parties acknowledge that the Purchased Assets constituting the Assumed Real
Property Leases are being assigned to, and assumed by, Buyer pursuant to the
Assignment and Assumption of Leases and not pursuant this Agreement.

 

2.             Assumption. (a) Each Seller hereby delegates to Buyer such
Seller’s Assumed Liabilities (to the extent assumed by Buyer herein or in the
Purchase Agreement), and (b) Buyer hereby assumes and agrees to discharge when
due (in accordance with its respective terms and subject to the respective
conditions thereof) only the Assumed Liabilities and no others. Notwithstanding
any provision in this Agreement to the contrary, Buyer shall not assume and
shall not be obligated to assume or be obligated to pay, perform or otherwise
discharge any Excluded Liability, and Sellers shall be solely and exclusively
liable with respect to all Excluded Liabilities.

 

3.             Delivery Pursuant to Purchase Agreement. Notwithstanding anything
to the contrary herein, Sellers and Buyer are executing and delivering this
Agreement in accordance with and subject to all of the terms and provisions of
the Purchase Agreement, including, without limitation, the provisions of Section
3.23 thereof. To the extent of any conflict between the terms and conditions of
this Agreement and the terms and conditions of the Purchase Agreement, the terms
and conditions of the Purchase Agreement shall govern, supersede and prevail.

 

 
 

 

4.Successors and Assigns; Binding Effect.

 

(a)       Except as expressly permitted in this Agreement, the rights and
obligations of the Parties under this Agreement shall not be assignable by such
Parties without the written consent of the other Parties hereto; provided,
however, that Buyer shall be entitled to assign any or all of its rights under
this Agreement to one or more of its Affiliates; provided that Buyer is not
relieved of any of its obligations hereunder by virtue of any such assignment.

 

(b)       This Agreement shall be binding upon and inure to the benefit of the
Parties and their successors and permitted assigns. The successors and permitted
assigns hereunder shall include any permitted assignee as well as the successors
in interest to such permitted assignee (whether by merger, consolidation,
liquidation (including successive mergers, consolidations or liquidations) or
otherwise). Nothing in this Agreement, expressed or implied, is intended or
shall be construed to confer upon any Person other than the Parties and
successors and assigns permitted by this Section 4 any right, remedy or claim
under or by reason of this Agreement.

 

5.            Amendments. This Agreement shall not be amended, modified or
supplemented except by a written instrument signed by an authorized
representative of each of the Parties.

 

6.            Governing Law.

 

(a)       This Agreement shall be governed by, and construed in accordance with,
the laws of the State of New York applicable to contracts executed in and to be
performed in that State.

 

(b)       All Actions arising out of or relating to this Agreement, including
the resolution of any and all disputes hereunder, shall be heard and determined
in the Bankruptcy Court, and the Parties hereby irrevocably submit to the
exclusive jurisdiction of the Bankruptcy Court in any such Proceeding and
irrevocably waive the defense of an inconvenient forum to the maintenance of any
such Proceeding. The Parties hereby consent to service of process by mail (in
accordance with Section 9.7 of the Purchase Agreement) or any other manner
permitted by law.

 

(c)       THE PARTIES HEREBY IRREVOCABLY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED IN CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF
SELLERS, BUYER, OR THEIR RESPECTIVE REPRESENTATIVES IN THE NEGOTIATION OR
PERFORMANCE HEREOF.

 

7.             Headings. The section and paragraph headings contained in this
Agreement are for reference purposes only and shall not in any way affect the
meaning or interpretation of this Agreement.

 

8.             Execution in Counterparts. This Agreement may be executed in
counterparts, each of which shall be considered an original instrument, but all
of which shall be considered one and the same agreement, and shall become
binding when one or more counterparts have been signed by and delivered to each
of the Parties. Delivery of an executed counterpart of a signature page to this
Agreement by facsimile or electronic delivery (i.e., by electronic mail of a PDF
signature page) shall be effective as delivery of a manually executed
counterpart of this Agreement.

 

[SIGNATURE PAGE FOLLOWS] 

 

 -2- 

 

 

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the
parties hereto as of the date first above written.

 

 

SELLERS:       ACETO CORPORATION

 

  By:       Name:     Title:

 

  ACETO REALTY, LLC

 

  By:       Name:     Title:

 

  ACETO AGRICULTURAL CHEMICALS CORPORATION

 

  By:       Name:     Title:

 

  BUYER:       NMC ATLAS, L.P.

 

  By:     Name:     Title:

 

[Signature Page to Assignment and Assumption Agreement]

 

 
 

 

EXHIBIT C

 

FORM OF BILL OF SALE

 

 
 

 

Agreed Form

 

BILL OF SALE

 

[•], 2019

 

Pursuant to that certain Amended and Restated Asset Purchase Agreement, dated as
of April [●], 2019 (as it may be amended from time to time, the “Purchase
Agreement”), by and among Aceto Corporation, a New York corporation (“Parent”),
Aceto Realty, LLC, a New York limited liability company (“Aceto Realty”), and
Aceto Agricultural Chemicals Corporation, a New York corporation (“NY Agri” and
together with Parent and Aceto Realty, “Sellers” and each, a “Seller”), each a
debtor and debtor in possession under Case No. 19-13448 pending in the United
States Bankruptcy Court for the District of New Jersey, on the one hand, and NMC
Atlas, L.P., a Delaware limited partnership (“Buyer”), on the other hand, and
for good and valuable consideration, the receipt and sufficiency of which
Sellers hereby expressly acknowledge, each Seller hereby sells, transfers,
assigns, conveys and delivers to Buyer and Buyer’s successors and assigns, free
and clear of all Liens, sales, transfer or transaction taxes of any kind
whatsoever, to have and to hold forever, all of its right, title and interest in
and to each of the Purchased Assets.

 

Except for terms specifically defined in this Bill of Sale, all capitalized
terms used herein shall have the meanings ascribed to such terms in the Purchase
Agreement.

 

Each Seller does hereby irrevocably constitute and appoint Buyer and Buyer’s
successors and assigns, such Seller’s true and lawful attorney, with full power
of substitution, in its name or otherwise, and on behalf of such Seller, or for
its own use, to claim, demand, collect and receive at any time and from time to
time any and all of the Purchased Assets, and to prosecute the same at law or in
equity and, upon discharge thereof, to complete, execute and deliver any and all
necessary instruments of satisfaction and release.

 

Notwithstanding anything to the contrary herein, each Seller is executing and
delivering this Bill of Sale in accordance with and subject to all of the terms
and provisions of the Purchase Agreement, including, without limitation, the
provisions of Section 3.23 thereof, and Buyer accepts this Bill of Sale on such
basis. To the extent of any conflict between the terms and conditions of this
Bill of Sale and the terms and conditions of the Purchase Agreement, the terms
and conditions of the Purchase Agreement shall govern, supersede and prevail.
This Bill of Sale shall not be amended, modified or supplemented except by a
written instrument signed by an authorized representative of each of the
Parties. This Bill of Sale shall be governed by, and construed in accordance
with, the laws of the State of New York applicable to contracts executed in and
to be performed in that State. This Bill of Sale is for the sole benefit of
Buyer and nothing herein, express or implied, is intended to or shall confer
upon any other person any legal or equitable benefit, claim, cause of action,
remedy or right of any kind.

 

[SIGNATURE PAGE FOLLOWS]

 

 
 

 

IN WITNESS WHEREOF, Sellers have caused this Bill of Sale to be executed as of
the date first above written.

 

  SELLERS:       ACETO CORPORATION

 

  By:       Name:     Title:

 

  ACETO REALTY, LLC

 

  By:       Name:     Title:

 

  ACETO AGRICULTURAL CHEMICALS CORPORATION

 

  By:       Name:     Title:

 

[Signature Page to Bill of Sale]