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Exhibit 10.02
BLISS TECHNOLOGIES INC.
0000 Xxxxx Xxxxxx
Xxxxxx Xxxxx, Xxxx 00000
March 19, 1999
Xxxx X. Xxxxx, Esq.
General Counsel
HMI Industries Inc.
0000 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Re: HMI/Bliss
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Dear Xxxx:
I refer to: (i) a Stock Purchase Agreement between Rhone Capital LLC and
HMI Industries Inc., dated as of December 17, 1997, and amended as of February
11, 1998; (ii) an Escrow Agreement among HMI, Bliss Technologies Inc. (formerly
known as Danube Inc.) and The Chase Manhattan Bank (as Escrow Agent), dated as
of March 27, 1998; and (iii) an Assignment and Assumption Agreement dated as of
March 27, 1998, whereby Bliss succeeded to all of Rhone's rights and obligations
under the Stock Purchase Agreement. Terms defined in the Stock Purchase
Agreement or the Escrow Agreement have the same meaning when used herein.
A dispute between HMI and Bliss has arisen regarding certain
representations, warranties and agreements of HMI in sections 3.15 and 5.8 and
Schedule 3.15 of the Stock Purchase Agreement that concern unusable and
unsaleable inventory of the Company. Under Article VIII of the Stock Purchase
Agreement, Bliss has sought indemnification by HMI in respect of its Claim
relating to this dispute. By this Letter Agreement, HMI and Bliss agree to
resolve the dispute as follows:
1. Concurrent with the execution of this Letter Agreement, HMI will execute
the enclosed Resolution Certificate Instructing the Escrow Agent to pay the
entire amount of
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Xxxx X. Xxxxx, Esq.
the Escrow Fund to Bliss within two business days following receipt of the
Resolution Certificate by the Escrow Agent.
2. HMI agrees to assert no Claim for indemnification under Article VIII of
the Stock Purchase Agreement now or at any time in the future.
3. In consideration of HMI's execution of the Resolution Certificate and
its agreement to assert no claims for indemnification under Article VIII of the
Stock Purchase Agreement, Bliss and all the Buyer Indemnified Parties agree to
make no further Claim for indemnification under sections 8.2(a), 8.2(b) and
8.2(c) of the Stock Purchase Agreement. Bliss and the Buyer Indemnified Parties
also agree to make no further Claim for indemnification under section 8.2(f) of
the Stock Purchase Agreement, but only to the extent that such a Claim would
arise from or be associated with any actions, suits, proceedings, demands,
judgments, costs and legal and other expenses incident to matters referred to in
sections 8.2(a), 8.2(b), and 8.2(c) of the Stock Purchase Agreement. Therefore,
irrespective of the time limitation for the assertion of indemnification Claims
by the Buyer set forth in section 8.3 of the Stock Purchase Agreement, Bliss
agrees that no further indemnification Claims will be made under sections
8.2(a), 8.2(b), 8.2(c) and 8.2(f) (as limited by the previous sentence) of the
Stock Purchase Agreement.
4. Bliss also agrees not to require HMI to purchase any unusable or
unsaleable inventory of Bliss pursuant to section 5.8 of the Stock Purchase
Agreement.
5. Bliss and the Buyer Environmental Indemnities further agree that they
will not seek reimbursement for any monies actually paid in respect of
Environmental Damages from the date of the Closing to and including March 31,
1999. In all other respects, section 8.5 of the Stock Purchase Agreement,
including HMI's indemnification obligations thereunder, remain unmodified and in
full force and effect.
6. In connection with paragraph 3 above, Bliss agrees that HMI shall have
the right to remove at their expense and dispose of raw materials covered by
section 5.8 and schedule 3.15 of the Stock Purchase Agreement with a book value
not greater than $50,000 by March 26, 1999.
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Xxxx X. Xxxxx, Esq.
Apart from the subject matter of this Letter Agreement, the terms of the
Stock Purchase Agreement and the Escrow Agreement remain unmodified and in full
force and effect. Your signature below will signify HMI's agreement to the terms
of this Letter Agreement.
Sincerely,
By: /s/ M. Xxxxx Xxxxxx
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Name: M. Xxxxx Xxxxxx
Title: Vice President, Bliss Technologies Inc.
Agreed to:
/s/ Xxxx X. Xxxxx 3/19/99
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Xxxx X. Xxxxx, Esq.
General Counsel
HMI Industries Inc.
