TWMC » Topics » TERMINATION

This excerpt taken from the TWMC 8-K filed Feb 22, 2006.

TERMINATION

 

10.1         Termination Events.

 

Anything contained in this Agreement to the contrary notwithstanding, this Agreement may be terminated at any time prior to the Closing Date:

 

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

 

(b)           by Buyer if (i) the Company has not filed the Sale Motion within two days of the Effective Date; (ii) the Bankruptcy Court has not entered the Bidding Procedures Order by March 1, 2006; (iii) the Auction is not held on or before March 22, 2006, (iv) the Sale Hearing is not held on or before March 24, 2006, or (v) the Closing Date has not occurred on or before April 4, 2006 (unless the failure to consummate is due to a material breach by Buyer);

 

(c)           by either party if a Governmental Authority issues a ruling or Order prohibiting the transactions contemplated hereby;

 

(d)           by Buyer in the event of any material breach by the Company of any of the Company’s agreements, covenants, representations or warranties contained herein or in the Bidding Procedures Order or the Sale Order, and the failure of the Company to cure such breach within fourteen (14) days after receipt of the Termination Notice specified in this subsection; provided, however, that Buyer (i) is not itself in material breach of any of its representations, warranties or covenants contained herein or in the Bidding Procedures Order or the Sale Order, (ii) notifies the Company in writing (the “Termination Notice”) of its intention to exercise its rights under this Agreement as a result of the breach, and (iii) specifies in such Termination Notice the representation, warranty or covenant contained herein or in the Bidding Procedures Order or the Sale Order of which the Company is allegedly in material breach;

 

(e)           by the Company in the event of any material breach by Buyer of any of Buyer’s agreements, representations or warranties contained herein or in the Bidding Procedures Order or the Sale Order, and the failure of the Buyer to cure such breach within fourteen (14)  days after receipt of the Termination Notice specified in this subsection; provided, however, that the Company (i) is not itself in material breach of any of its representations, warranties or covenants contained herein or in the Bidding Procedures Order or the Sale Order, (ii) sends a Termination Notice, and (iii) specifies in such Termination Notice the representation, warranty or covenant contained herein or in the Bidding Procedures Order or the Sale Order of which Buyer is allegedly in material breach;

 

(f)            by either party, if there is a failure to satisfy a closing condition in favor of the party attempting to terminate (unless such failure is caused by such terminating party);

 

(g)           by Buyer, if the Company consummates another transaction or series of transactions in which any material portion of the Company’s stock or assets are to be sold, transferred or otherwise disposed of;

 

(h)           by Buyer, if the Company withdraws or seeks authority to withdraw its motion seeking approval of the transactions contemplated by this Agreement, or announces any stand alone plan of reorganization or liquidation (or supports any such plan filed by any other party); or

 

(i)            by either party if the sale does not close within thirty (30) days of entry of the Sale Order.

 

10.2         Effect of Termination.

 

(a)   In the event of termination of this Agreement by either party, except as otherwise provided in this Section 10.2, all rights and obligations of the Parties under this Agreement shall terminate without any liability of any party to any other party.  The provisions of Sections 2.2(a), 3.15,

 

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4.4, 5.6, 5.10, 6.2, 10.2, 11.2 and 11.10 shall expressly survive the expiration or termination of this Agreement.

 

(b)   Notwithstanding Section 10.2(a), in the event of a termination pursuant to Section 10.1(e), the Company shall be entitled to retain the Deposit as liquidated damages as its sole and exclusive remedy against Buyer in all respects for any claim against Buyer arising under this Agreement or otherwise.

 

(c)   Notwithstanding Section 10.2(a), from and after the entry of the Bidding Procedures Order, if this Agreement is terminated pursuant to Sections 10.1(d), 10.1(g), 10.1(h), or if the Buyer terminates this Agreement because the Sale Hearing has not occurred by April 24, 2006 (other than as a result of the action or inaction of the Buyer), then the Company shall pay to Buyer the Expense Reimbursement in full and complete satisfaction of all of the Company’s obligations hereunder (except for the repayment of the Deposit and interest accrued thereon).  The payment of the Expense Reimbursement shall be made by wire transfer of immediately available funds promptly (but in any event within two (2) business days) following the occurrence of one of the termination events set forth in this paragraph, and will be granted super priority administrative expense status (junior to the claims of the DIP Lenders and prepetition secured lenders) in the Company’s bankruptcy case.

 

(d)   Notwithstanding Section 10.2(a), from and after the entry of the Bidding Procedures Order, if this Agreement is terminated pursuant to Sections 10.1(g) or 10.1(h), then the Company shall pay to Buyer the Break-Up Fee in full and complete satisfaction of all of the Company’s obligations hereunder (except for the repayment of the Deposit and interest accrued thereon).  The payment of the Break-Up Fee shall be made by wire transfer of immediately available funds promptly (but in any event within two (2) business days) following the occurrence of one of the termination events set forth in this paragraph, and will be granted super priority administrative expense status (junior to the claims of the DIP Lenders and prepetition secured lenders) in the Company’s bankruptcy case.  In no event shall Buyer be entitled to both the Expense Reimbursement and the Break-Up Fee.

 

(e)   In the event of a termination of this Agreement pursuant to any provision of this Article X (other than pursuant to Section 10.1(e)), the Company shall promptly return to Buyer the Deposit (together with interest thereon).

 

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