This excerpt taken from the AVD 10-K filed Mar 14, 2007.
ARTICLE VI. REPRESENTATIONS AND WARRANTIES
Borrower and each Guarantor represents and warrants to Agent and the Lenders that:
6.01 Financial Condition; No Change. (a) The Audited Financial Statements (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; (ii) fairly present the financial condition of American Vanguard and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; and (iii) show all material indebtedness and other liabilities, direct or contingent, of American Vanguard and its Subsidiaries as of the date thereof, including liabilities for taxes, material commitments and Indebtedness.
(b) The balance sheets of American Vanguard most recently delivered to the Lenders, and the statements of income or operations, shareholders equity and cash flows for the fiscal quarter ended on that date (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein, and (ii) fairly present the financial condition of Borrower as of the date thereof and their results of operations for the period covered thereby, subject, in the case of clauses (i) and (ii), to the absence of footnotes and to normal year-end audit adjustments.
(c) Since the date of the Audited Financial Statements, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect.
6.02 Corporate Existence; Power; Etc. Each Loan Party and each Subsidiary thereof (a) is duly organized or formed, validly existing and, as applicable, in good standing under the Laws of the jurisdiction of its incorporation or organization, (b) has all requisite power and authority and all requisite governmental licenses, authorizations, consents and approvals to (i) own or lease its assets and carry on its business and (ii) execute, deliver and perform its obligations under the Loan Documents to which it is a party, and (c) is duly qualified and is licensed and, as applicable, in good standing under the Laws of each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification or license; except in each case referred to in clause (b)(i), or (c), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.
6.03 Authorization; No Contravention. The execution, delivery and performance by each Loan Party of each Loan Document to which such Person is party, have been duly authorized by all necessary corporate or other organizational action, and do not and will not (a) contravene the terms of any of such Persons Organization Documents; (b) conflict with or result in any breach or contravention of, or the creation of any Lien under, or require any payment to be made under (i) any Contractual Obligation to which such Person is a party or affecting such Person or the properties of such Person or any of its Subsidiaries or (ii) any order, injunction, writ or decree of any Governmental Authority or any arbitral
award to which such Person or its property is subject; or (c) violate any Law, except in each case referred to in clause (b) or (c), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.
6.04 Binding Effect. This Agreement has been, and each other Loan Document, when delivered hereunder, will have been, duly executed and delivered by each Loan Party that is party thereto. This Agreement constitutes, and each other Loan Document when so delivered will constitute, a legal, valid and binding obligation of such Loan Party, enforceable against each Loan Party that is party thereto in accordance with its terms.
6.05 Governmental Authorization; Other Consents. No approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery or performance by, or enforcement against, any Loan Party of this Agreement or any other Loan Document.
6.06 Litigation. Except as disclosed in SEC Filings made to date, there are no actions, suits, proceedings, claims or disputes pending or, to the knowledge of Borrower after due and diligent investigation, threatened or contemplated, at law, in equity, in arbitration or before any Governmental Authority, by or against Borrower or any of its Subsidiaries or against any of their properties or revenues that (a) purport to affect or pertain to this Agreement or any other Loan Document, or any of the transactions contemplated hereby, or (b) either individually or in the aggregate, if determined adversely, could reasonably be expected to have a Material Adverse Effect, and there has been no material adverse change in the status, or financial effect on any Loan Party or any Material Subsidiary thereof, of such matters.
6.07 Taxes. Borrower and its Subsidiaries have filed all Federal, state and other material tax returns and reports required to be filed, and have paid all Federal, state and other material taxes, assessments, fees and other governmental charges levied or imposed upon them or their properties, income or assets otherwise due and payable, except those which are being contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves have been provided in accordance with GAAP. There is no proposed tax assessment against Borrower or any Material Subsidiary that would, if made, have a Material Adverse Effect.
6.08 Margin Regulations; Investment Company Act. (a) Borrower is not engaged and will not engage, principally or as one of its important activities, in the business of purchasing or carrying margin stock (within the meaning of Regulation U issued by the FRB), or extending credit for the purpose of purchasing or carrying margin stock.
(b) None of Borrower, any Person Controlling Borrower, or any Material Subsidiary is or is required to be registered as an investment company under the Investment Company Act of 1940.
6.09 Subsidiaries. Except as disclosed to the extent required by Law in SEC Filings made to date, American Vanguard has no Subsidiaries, and all of the outstanding Equity Interests in such Subsidiaries have been validly issued, are fully paid and nonassessable and are owned by a Loan Party in the amounts specified in the SEC Filings free and clear of all Liens. Borrower has no equity investments in any other corporation or entity other than those specifically disclosed, to the extent required by Law, in the SEC Filings. All of the outstanding Equity Interests in Borrower have been validly issued and are fully paid and nonassessable.
6.10 ERISA Compliance. (a) Each Plan is in compliance in all material respects with the applicable provisions of ERISA, the Code and other Federal or state Laws. Each Plan that is intended to qualify under Section 401(a) of the Code has received a favorable determination letter from the IRS or an application for such a letter is currently being processed by the IRS with respect thereto and, to the best knowledge of Borrower, nothing has occurred which would prevent, or cause the loss of, such qualification. Borrower and each ERISA Affiliate have made all required contributions to each Plan
subject to Section 412 of the Code, and no application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of Borrower, threatened claims, actions or lawsuits, or action by any Governmental Authority, with respect to any Plan that could be reasonably be expected to have a Material Adverse Effect. There has been no prohibited transaction or violation of the fiduciary responsibility rules with respect to any Plan that has resulted or could reasonably be expected to result in a Material Adverse Effect.
(c) Individually or in the aggregate, (i) no ERISA Event has occurred or is reasonably expected to occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any Pension Plan (other than premiums due and not delinquent under Section 4007 of ERISA); (iv) neither Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and no event has occurred which, with the giving of notice under Section 4219 of ERISA, would result in such liability) under Section 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (v) neither Borrower nor any ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or 4212(c) of ERISA that reasonably could be expected to have a Material Adverse Effect.
6.11 Ownership of Property; Liens. Borrower and each Subsidiary has good record and marketable title in fee simple to, or valid leasehold interests in, all real property necessary or used in the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The property of Borrower and its Subsidiaries is subject to no Liens, other than Liens permitted by Section 8.01.
6.12 No Default. Neither any Loan Party nor any Subsidiary thereof is in default under or with respect to any Contractual Obligation and no Default has occurred under this Agreement or any Loan Document that, in any case, could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
6.13 Insurance. The properties of Borrower and its Subsidiaries are insured with financially sound and reputable insurance companies not Affiliates of Borrower, in such amounts (after giving effect to any self-insurance compatible with the following standards), with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where Borrower or the applicable Subsidiary operates.
6.14 Disclosure. Borrower has disclosed to Agent and Lenders all agreements, instruments and corporate or other restrictions to which it or any of its Subsidiaries is subject, and all other matters known to it, that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect. No report, financial statement, certificate or other information furnished (whether in writing or orally) by or on behalf of any Loan Party to Agent or any Lender in connection with the transactions contemplated hereby and the negotiation of this Agreement or delivered hereunder or under any other Loan Document (in each case, as modified or supplemented by other information so furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that, with respect to projected financial information, Borrower represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time.
6.15 Compliance with Laws. Each Loan Party and each Material Subsidiary thereof is in compliance in all material respects with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its properties, except in such instances in which (a) such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted or (b) the failure to comply therewith, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.
6.16 Environmental Compliance. To the best of its knowledge, the operations of American Vanguard and each of its Subsidiaries comply substantially, and during the term of this Agreement will at all times comply substantially, in all respects with all applicable Environmental Laws; American Vanguard and each of its Subsidiaries has obtained licenses, permits, authorizations and registrations required under applicable Environmental Law (Environmental Permits) and necessary for its ordinary operations, all such Environmental Permits are in good standing, and American Vanguard and each of its Subsidiaries is in compliance with all material terms and conditions of such Environmental Permits; neither American Vanguard nor any of its Subsidiaries nor any of their respective present properties or operations are subject to any outstanding written order from or agreement with any Governmental Authority nor subject to any judicial or docketed administrative proceeding, respecting any Environmental Law, Environmental Claim or Hazardous Material not previously disclosed; there are no Hazardous Materials or other conditions or circumstances existing, or arising from operations prior to the date of this Agreement, with respect to any property of American Vanguard or any of its Subsidiaries that would reasonably be expected to give rise to Environmental Claims; provided, however, that with respect to property leased from an unrelated third party, the foregoing representation is made to the best knowledge of Borrower. In addition (i) neither American Vanguard nor any of its Subsidiaries has or maintains any underground storage tanks which are not properly registered or permitted under applicable Environmental Laws or which are leaking or disposing of Hazardous Materials off-site, and (ii) each of American Vanguard and its Subsidiaries has notified all of its employees of the existence, if any, of any health hazard arising from the conditions of their employment and have met all notification requirements under Title III of CERCLA and all other applicable Environmental Law.
6.17 Security Documents. The Security Documents are effective to create in favor of Agent, for the benefit of the Guaranteed and Secured Parties, a legal, valid and enforceable security interest in the Collateral and, when duly recorded or filed, the Liens granted under the Security Documents will constitute a fully perfected first priority Lien on, and security interest in, all right, title and interest of the grantors thereunder in such Collateral, subject to the effect of applicable bankruptcy and similar Laws affecting the rights of creditors generally and the effect of equitable principles whether applied in an action at Law or a suit at equity.
6.18 Solvency. American Vanguard and each of its Subsidiaries is Solvent after giving effect to each of the Loan Documents.
6.19 Intellectual Property; Licenses, Etc. American Vanguard and its Subsidiaries own, or possess the right to use, all of the trademarks, service marks, trade names, copyrights, patents, patent rights, franchises, licenses and other intellectual property rights that are reasonably necessary for the operation of their respective businesses, without conflict with the rights of any other Person. To the best knowledge of Borrower, no slogan or other advertising device, product, process, method, substance, part or other material now employed, or now contemplated to be employed, by American Vanguard or any Material Subsidiary infringes upon any rights held by any other Person. No claim or litigation regarding any of the foregoing is pending or, to the best knowledge of Borrower, threatened, which, either individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.
This excerpt taken from the AVD 10-Q filed May 10, 2005.
5.12 Representations and Warranties.
A. Quality and Specifications. BASF warrants and represents that, upon delivery, each order of Compound TGAI shall conform to the Specifications.
B. Disclaimer. THE WARRANTY SET FORTH IN SECTION 5.12(A) IS EXPRESSLY IN LIEU OF ALL OTHER WARRANTIES REGARDING THE COMPOUND TGAI AND ALL SUCH OTHER WARRANTIES AND REPRESENTATIONS OF WHATEVER KIND ARE HEREBY DISCLAIMED BY BASF AND WAIVED BY AMVAC. BASF SHALL HAVE NO LIABILITY TO AMVAC FOR ANY GENERAL, INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE, CONSEQUENTIAL OR LIKE DAMAGES, HOWSOEVER NAMED, INCLUDING, WITHOUT LIMITATION, LOST PROFITS ARISING OUT OF THE USE, FORMULATION, OR IMPORTATION OF ANY COMPOUND TGAI OR THE PROMOTION, OFFER FOR SALE, SALE OR DISTRIBUTION OF COMPOUND TGAI OR ANY PRODUCT. BASF MAKES NO WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY PURPOSE
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WITH RESPECT TO ANY COMPOUND TGAI EXCEPT AS SECTION 5.12(A) EXPRESSLY PROVIDES. For the avoidance of doubt, nothing in this Section 5.12(B) is intended to limit any of AMVACs rights or remedies under the applicable provisions of Articles VII and VIII.
C. Exclusive Remedy. Subject to the provisions of Section 8.2(iv), BASFs sole liability for any and all breaches of BASFs warranty that each order of Compound TGAI shall conform to the Specifications upon delivery thereof to AMVAC shall be expressly limited to replacing the Compound TGAI which is determined, in accordance with the provisions of Section 5.11(B), to be defective provided that the conditions set forth in Section 5.12(D) are satisfied. For the avoidance of doubt, the Parties acknowledge and agree that the provisions of Section 8.2(vi) shall not apply to any breach of Section 5.12(A).
D. Claims. Any claim for a breach of Section 5.12(A) shall be valid only when submitted (i) in writing by AMVAC to BASF within [*] after discovery of the defect but in no event later than [*] after receipt by AMVAC at the US port of entry of the Compound TGAI in question or, in the case of latent defects, no later than [*] after receipt by AMVAC at the US port of entry of the Compound TGAI in question to AMVAC and (ii) together with the allegedly defective Compound TGAI, if such allegedly defective Compound TGAI is requested by BASF. No claim of any kind shall be valid with respect to any Compound TGAI which has been altered (including, without limitation, formulated or in the process of being formulated into any Product), neglected, damaged, handled or stored in any manner which either adversely affects such Compound TGAI or is inconsistent with the terms and conditions of this Agreement, unless the Compound TGAI would have been defective, based on comparative batch samples to which Section 5.11(C) refers for the Compound TGAI in question, regardless of such alteration, neglect, damage, handling or storage.
E. Survival. This Section 5.12 shall survive expiration or early termination of this Agreement for a period of [*] thereafter.
5.13 All Sales Final. Subject to the provisions of Sections 5.12(B), (C), and (D) all sales to AMVAC under this Agreement are final and no Compound TGAI may be returned to BASF without its prior written authorization.
5.14 Applicable Permits. Each Party shall obtain and thereafter maintain all necessary Applicable Permits pertaining to the exercise of its rights and performance of its obligations under this Agreement.
5.15 Allocation of Supply. In the event that a force majeure event referred to in Article XI occurs including, without limitation, if the effect of a force majeure event with respect to Compound TGAI is merely a reduction, rather than a permanent discontinuance, BASF shall allocate its then-remaining supply of Compound TGAI between BASF, its Affiliates and AMVAC in a proportion corresponding to the requirements of each Party therefor for the then-current Contract Year, it being acknowledged and agreed that reference to BASFs requirements herein refers to BASFs own requirements and the requirements of those Persons with whom BASF is party to a legally enforceable agreement covering the supply of Compound technical form of active ingredient and/or products containing the same as an active ingredient.
5.16 Other Active Ingredients. The Parties acknowledge that they may discuss the viability of BASF supplying [*] (other than Compound TGAI) including, without limitation, [*] (Other [*]) for use in BASF Products and Other Products; provided, however, any such arrangement shall be negotiated and, if the Parties mutually agree on the terms and conditions pursuant to which such Other [*] will be supplied and purchased, such arrangement shall be the subject of a separate written agreement between the Parties. For the avoidance of doubt, the Parties acknowledge and agree that AMVAC shall have the right to purchase Other [*] from any Person; and provided, further, that AMVAC shall notify BASF of the price and other material supply terms for such Other [*], if AMVAC is legally permitted to so notify BASF. BASF shall have [*] from the date it receives each such notice to meet the terms offered to AMVAC for the Other [*] in question and, if (i) BASF meets such terms and conditions and (ii)AMVACs purchase of such Other [*] from BASF would be at least as favorable to AMVAC when compared to purchasing such Other [*] from another supplier, AMVAC agrees to purchase such Other [*] from BASF pursuant to a mutually acceptable separate written agreement between the Parties.
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