Exhibit 2.10
FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT (the
"First Amendment") is made and entered into this 4th day of
June, 2003 by and among XXXXXXX COMPANIES, INC., an Oklahoma
corporation ("Xxxxxxx"), RAINBOW FOOD GROUP, INC., a Nevada
corporation ("Rainbow," and together with Xxxxxxx, "Seller"), RBF
CORP., a Wisconsin corporation ("Buyer"), and XXXXXX'X, INC., a
Wisconsin corporation ("Parent"). Each of Buyer, Seller and
Parent shall be referred to herein individually as a "Party" and
collectively as the "Parties".
W I T N E S S E T H:
WHEREAS, the Parties entered into that certain Asset
Purchase Agreement on May 2, 2003 (the "Agreement") pursuant to
which Seller agreed to sell, and Buyer agreed to acquire from
Seller, the Acquired Assets and Buyer agreed to assume certain
liabilities of Seller related to the Acquired Assets on the terms
and subject to the conditions set forth in the Agreement;
WHEREAS, the Parties desire to amend certain of the
terms and provisions of the Agreement;
WHEREAS, all defined terms that are used in this First
Amendment shall have the meanings in the Agreement, unless
separately defined herein.
NOW THEREFORE, the Parties hereto agree as follows:
1. Bankruptcy Condition. Section 11.14 of the Agreement is
hereby amended to read, in its entirety, as follows:
11.14. Bankruptcy Conditionion.
a) The Bidding Procedures Order shall have been entered by the
Bankruptcy Court as soon as practicable and no later than May 21,
2003. The Sale Order shall have been entered by the Bankruptcy
Court as soon as practicable and no later than August 6, 2003.
b) The Sale Order, in substantially the form attached hereto as
Annex III, shall approve and authorize the sale of the Acquired
Assets, the results of the Auction, and the assumption and
assignment of the Acquired Contracts and the Acquired Contracts
shall have been actually assumed and assigned to Buyer such that,
subject only to payment by Buyer of the Cure Costs, the Acquired
Contracts will be in full force and effect from and after the
Closing with non-debtor parties being barred and enjoined from
asserting against Buyer, among other things, any defaults,
breaches or claims of pecuniary losses existing as of the Closing
or by reason of the Closing.
c) The Bidding Procedures Order shall include provisions for
the following:
i. As soon as Seller consummates the first of any Acquisition
Proposals, Seller shall immediately pay to Buyer (in immediately
available cash via wire transfer to an account designated by
Buyer), a breakup fee equal to $3,000,000 (the "Breakup Fee").
Regardless of the number of Acquisition Proposals consummated,
Seller shall pay a single Break-Up Fee from the proceeds of any
Acquisition Proposal, and no lien, claim, encumbrance or interest
whatsoever shall attach to the proceeds of any Acquisition
Proposal to the extent (and only to the extent) such proceeds are
required to pay the Break-Up Fee (it being understood that liens,
claims, encumbrances and interests shall immediately attach to
all proceeds of any Acquisition Proposal to the extent such
proceeds are not required to pay the Break-Up Fee with the same
validity, priority, force and effect that such liens, claims,
encumbrances and interests had on the Assets subject to such
Acquisition Proposal immediately before the consummation of such
Acquisition Proposal), and under no circumstances shall more than
one Break-Up Fee be paid;
ii. If the transactions contemplated hereby are not consummated
for any reason other than the material breach by Buyer of this
Agreement (which material breach, following notice from Seller to
Buyer, is not cured in accordance with this Agreement) or the
failure of Parent to obtain the Lender's Consent, Seller shall
immediately pay to Buyer (in immediately available cash via wire
transfer to an account designated by Buyer) an amount equal to
the documented reasonable costs and out-of-pocket expenses
incurred by Buyer in connection with its legal, environmental,
accounting and business due diligence, the securing of any
necessary Lenders' Consents, and the preparation and negotiation
of this Agreement (including, without limitation, the reasonable
costs and expenses associated with Section 8.2) up to a maximum
of $1,500,000 (if no Break-Up Fee is paid to Buyer) or up to a
maximum of $500,000 (if the Break-Up Fee is paid to Buyer) (the
"Expense Reimbursement"); provided that (a) prior to or upon such
date as the Expense Reimbursement is payable thereto in
accordance herewith, Buyer shall submit to Seller, counsel for
the Official Committee of Unsecured Creditors (the "Creditors'
Committee"), counsel to the Lenders' agents for Seller's post-
petition financing facility (the "Postpetition Lenders' Agents"),
and the Office of the United State Trustee (collectively, the
"Review Parties") documentation for the items for which it seeks
reimbursement; and except to the extent that the Review Parties
object to the reasonableness of the items for which Buyer seeks
reimbursement, Seller shall pay the Expense Reimbursement to
Buyer in accordance herewith no later than five business days
after the submission by Buyer to the Review Parties of such
documentation (the "Payment Date"); and to the extent (and only
to the extent) that the Review Parties object to the
reasonableness of the items for which Buyer seeks reimbursement,
Seller may withhold (in escrow for Buyer) the corresponding
portion (if any) of the Expense Reimbursement and shall notify
Buyer in writing of the Review Parties' objections (including
reasonable detail for the rationale for such objections) no later
than the Payment Date; and Buyer and the Review Parties shall
have five business days (or such longer time as they may agree)
from Buyer's receipt of the Review Parties' objections to resolve
the issues raised therein; and to the extent that Buyer and the
Review Parties cannot resolve such issues within such five
business days (or such longer period as they may agree), the
Review Parties may file an objection to the reasonableness of the
disputed portion of Buyer's request for reimbursement with the
Bankruptcy Court; provided, however, that the Review Parties must
file any such objection by no later than five business days after
the conclusion of the negotiation period set forth in the
preceding sentence; provided, further, that if none of the Review
Parties file such an objection by such deadline, Seller shall pay
the previously withheld portion of the Expense Reimbursement to
Buyer in accordance herewith within two Business Days; and
notwithstanding any provision of this paragraph to the contrary,
if the Break-Up Fee is paid to Buyer (and, therefore, the maximum
amount of the Expense Reimbursement is $500,000), Seller shall
pay the Expense Reimbursement to Buyer upon submission by Buyer
to the Review Parties of documentation for the items for which it
seeks reimbursement; and (b) Buyer shall have an allowed
administrative expense claim for any Expense Reimbursement;
iii. That Seller is authorized without further Bankruptcy Court
action to pay any amounts that become due and payable to Buyer
pursuant to this Agreement (including, without limitation, the
Breakup Fee and Expense Reimbursement) and that such amounts
shall be payable from the proceeds of the Acquisition Proposal as
provided in this Section 11.14;
iv. No party submitting any other offer to purchase the Acquired
Assets or a Qualifying Bid shall be entitled to any expense
reimbursement, breakup fee, bid protection, or termination or
similar fee or payment;
v. Prior to receipt by a prospective Bidder of any Confidential
Information (including, but not limited to, business and
financial information and access to representatives of Seller)
from Seller, each such Bidder will be required to execute a
confidentiality agreement, in a form and in substance acceptable
to Seller in its discretion, after consultation with the
Creditors' Committee and the Postpetition Lenders' Agents, and
deliver evidence satisfactory to Seller, in Seller's discretion
after consultation with the Creditors' Committee and the
Postpetition Lenders' Agents, establishing such potential
Bidders' financial capability to timely consummate a purchase of
the Acquired Assets;
vi. Each Bidder shall submit an executed asset purchase
agreement, substantially similar to this Agreement, except that
it may relate to fewer than all of the Acquired Assets, along
with any other bid package requirements to Seller, and place into
escrow a cash deposit of no less than $4,000,000. The foregoing
must be completed at least two (2) Business Days prior to the
Auction; provided, however, that Seller may, in its discretion
(after consultation with the Creditors' Committee), and with the
consent of the Buyer (which consent may not be unreasonably
delayed or unreasonably withheld), extend this deadline;
vii. A Bid will not be considered by Seller as qualified for the
Auction (a "Qualifying Bid") unless (i) such Bid is greater than
the sum of the Estimated Cash Purchase Price plus Five Million
Dollars ($5,000,000), even if fewer than all of the Acquired
Assets are the subject of the Bid, and (ii) such Bid satisfies
the requirements set forth in immediately preceding subparagraphs
(v) and (vi). The bidder, which may consist of a single bidder
or a group of bidders acting in concert, of any such Qualifying
Bid is a "Qualified Bidder";
viii. Seller shall conduct the Auction on the date
immediately prior to the date of the Sale Hearing, regardless of
whether it receives any Qualifying Bids;
ix. Only Qualified Bidders and Buyer may participate in the
Auction;
x. The Estimated Cash Purchase Price offered by Buyer herein
shall be deemed to be the opening Bid at the Auction. The Bid
subsequent thereto must be a Qualifying Bid (the "Second Bid").
All Bids after the Second Bid must be submitted by a Qualified
Bidder and must be for an amount not less than $250,000 higher
than any previous Bid;
xi. Buyer shall have the right to submit additional Bids;
xii. At the Auction, Seller shall have the right to select the
highest and/or best Bid from Buyer and any Qualified Bidder (the
"Highest and Best Bid"), which will be determined by considering,
among other things: (i) the number, type and nature of any
changes to this asset purchase agreement requested by each
Bidder; (ii) the extent to which such modifications are likely to
delay closing of the sale of the Acquired Assets and the cost to
Seller of such modifications or delay; (iii) the total and net
consideration to be received by Seller; (iv) the likelihood of
the Bidder's ability to close a transaction and the timing
thereof; and (v) the net benefit to Seller's estate, taking into
account Buyer's rights to the Breakup Fee and Expense
Reimbursement. Seller plans to conduct a separate auction (at
which auction a representative of Buyer may be present) for the
sale (free and clear of liens, claims, rights, interest and
encumbrances) of the real and personal property assets (the
"Product Supply Center Assets") used in the operation of Seller's
Product Supply Center, as described in Exhibit 2 to the Bid
Procedures Order. Seller, in consultation with the Creditors'
Committee and the Postpetition Lenders' Agents, may consider any
bid for the Product Supply Center Assets (if any, a "PSC Bid") in
evaluating the Highest and/or Best Bid for the Acquired Assets.
If a bidder wishes to bid on both any of the Product Supply
Center Assets and any of the Acquired Assets, then Seller (after
consultation with the Creditors' Committee and the Postpetition
Lenders' Agent) may consider such bid in evaluating the Highest
and/or Best Bid only if: (a) any bid for the Acquired Assets
submitted by the party submitting the PSC Bid (the "PSC Bidder")
is otherwise a Qualifying Bid and (b) the PSC Bidder has
conditioned the PSC Bid upon the determination that the PSC
Bidder's Bid for the Acquired Assets is the Highest and/or Best
Bid;
xiii. During the Auction, all Bids must be solicited and
submitted in the presence of all other Qualified Bidders (who
have not affirmatively left the Auction); and
xiv. Buyer shall have standing to contest the Highest and/or Best
Bid selected by Seller.
2. Final Price Adjustment and Payment. Section 4.6(a) of the
Agreement is hereby amended to read, in its entirety, as follows:
"Within thirty (30) Business Days after the
Closing Date, or any Subsequent Closing Date, Seller shall
deliver to Buyer a written statement of its final calculation of
Cash on Hand, Inventory Purchase Price, and any discrepancies in
the prorations made pursuant to Section 12.1 (c) between the
estimated amount of the prorations made at Closing for such items
and the calculation of the actual amounts that should have been
prorated (all of the foregoing being referred to as the "Post
Closing Reconciliations"). If Buyer disputes Seller's
calculations of the Post Closing Reconciliations, Buyer shall
respond to Seller in writing within ten (10) Business Days after
receipt of Seller's calculation and provide a written statement
of Buyer's calculation of the Post Closing Reconciliations. If
Buyer and Seller are unable to agree on a final calculation of
the Post Closing Reconciliations by the tenth Business Day after
the Seller's receipt of Buyer's response to the proposed final
calculation of the Post Closing Reconciliations, then either
party shall be entitled to submit the matter to the Bankruptcy
Court for resolution of the dispute. For the purposes of Section
4.6(b), the "Determination Date" shall be the date on which the
Post Closing Reconciliations are finally determined in accordance
with Article 4 and the Parties shall reconcile and settle any
discrepancies through the procedure outlined in Section 4.6(b).
For purposes of such section, the Cash Purchase Price shall refer
to the purchase price specified in Section 4.1(a), with credits
or debits as appropriate to reflect the actual prorations
contemplated by Section 12.1(c)."
3. Intellectual Property and Trademarks. Section 2.1(j) of the
Agreement is hereby amended to read, in its entirety, as follows:
"(j) Intellectual Properties and Trademarks. All
Intellectual Property and Trademarks of the Seller relating to
the name "Rainbow", "Rainbow Foods" or variations thereof
(whether or not used in the operation of the Store Properties,
including those items described in Schedule 2.1(j) (the "Acquired
Intellectual Property")."
4. Closing Procedures. The Parties have reached certain
agreements regarding the procedures to be followed in conducting
the Inventory Count and concluding the Closing with respect to
the Store Properties. Those agreements are as set forth in this
paragraph.
4.1 Commencement of Inventories. The parties agree that the
Inventory Count of the respective Store Properties will be
conducted according to the schedule set forth on Exhibit A
hereto. Such Inventory Counts will commence at a mutually
convenient time on the evening of the day indicated and will be
concluded as promptly as reasonably practical. Upon the
commencement of the Inventory Count as to any Store Property the
store will be closed for retail business and there will be no
further conditions to the Buyer's obligation to purchase the
Acquired Assets with respect to such Store Property in accordance
with the terms of the Agreement.
4.2 Effective Time. The effective time of the conveyance of the
Acquired Assets, assumption of the Assumed Liabilities,
employment of Store Employees and any other actions to be taken
or events occurring under the Agreement as of or by reference to
the Closing Date with respect to any Store Property shall be
12:01 a.m. on the day following the commencement of the Inventory
Count with respect to such Store Property (the "Effective Time").
4.3 Inventory Confirmation. The parties agree that promptly
upon completion of the Inventory Count with respect to any Store
Property the parties will execute a certification in the form
attached hereto as Exhibit B (the "Purchase Price
Certification"). With respect to the Purchase Price
Certification for any Store Property (a) the Asset Purchase Price
shall be the Asset Purchase Price allocable to the Store Property
set forth in Schedule 4.5 to the Agreement (as amended hereby),
(b) the Inventory Purchase Price shall be the Inventory Purchase
Price for the Store Property determined in accordance with
Section 4.2 of the Agreement (but subject to post-closing
adjustment under Section 4.6 of the Agreement), (c) the
prorations shall be the net credit or debit to the Asset Purchase
Price reflecting applicable prorations for the Store Property to
which the Parties have agreed in accordance with Section 12.1(c)
of the Agreement (but subject to post-closing adjustment under
Section 4.6 of the Agreement), (d) the Indemnity Escrow Amount
shall be the Store Percentage (as hereinafter defined)
ofmultiplied by $71,500,000, and (e) the Purchase Price Escrow
Amount shall be the Store Percentage (as hereinafter defined) of
$1,000,000. For purposes of this First Amendment paragraph the
Store Percentage for any Store Property shall be the percentage
of the total Asset Purchase Price of $424,5000,000 represented by
such Store Property's allocable portion of the Asset Purchase
Price set forth on Schedule 4.5 of the Agreement as amended
hereby.
4.4 Escrow. On or prior to the close of business on [June 6,
2003] Buyer will deposit in escrow that portion of the Asset
Purchase Price that is allocable under Schedule 4.5 of the
Agreement to the Store Properties (the "Weekend Stores") for
which the Inventory Count, as set forth on Exhibit A hereto, is
to commence on either Friday, June 6 or Saturday, June 7,
together with an amount equal to the sum of the Store Percentages
of the Weekend Stores multiplied by the estimated Inventory
Purchase Price of $40,000,000. the sum of $82,500,000
representing (a) the Asset Purchase Price of $42,500,000 and (b)
the Estimated Inventory Purchase Price of $40,000,000. Such
amount (which, together with any interest accrued thereon while
held in escrow hereunder, shall be referred to as the "Funding
Deposit") will be held pursuant to an escrow agreement (the
"Purchase Price Funding Escrow Agreement") containing the terms
and in the form of Exhibit C hereto. In the case of any Weekend
Store, Tthe Purchase Price Certification, when signed by Seller
and Buyer, shallfor any Store Property shall, when signed by
Seller and Buyer, constitute instructions to the Escrow Agent to
(a) disburse the Indemnity Escrow Amount shown on the Purchase
Price Certification to the Escrow Agent to hold pursuant to the
Indemnity Escrow Agreement (b) disburse the Purchase Price Escrow
Amount shown on the Purchase Price Certification to the Escrow
Agent to hold pursuant to the Purchase Price Adjustment Escrow
Agreement and (c) remit to Seller (or, if so instructed by
Seller, to Seller's lenders) by wire transfer an amount equal to
the Net Payable to Seller. In the case of any Store Property
other than a Weekend Store, immediately upon the completion of a
Purchase Price Certification with respect to such a Store
Property, Buyer will deliver, via wire transfer of immediately
available funds, (a) to the Escrow Agent, the Indemnity Escrow
Amount shown on the Purchase Price Certification, to hold
pursuant to the Indemnity Escrow Agreement (b) to the Escrow
Agent, the Purchase Price Escrow Amount shown on the Purchase
Price Certification, to hold pursuant to the Purchase Price
Adjustment Escrow Agreement and (c) to Seller (or, if so
instructed by Seller, to Seller's lenders), an amount equal to
the Net Payable to Seller shown on the Purchase Price
Certification. To the extent the Funding Deposit is not
sufficient to pay all amounts payable to Seller pursuant to the
respective Purchase Price Certifications for the Weekend Store
Properties, Buyer will remit such amounts in immediately
available funds to Seller. Upon the conclusion of the transfers
of funds contemplated by this paragraph with respect to all of
the Weekend Stores Properties, the Parties will jointly instruct
the eEscrow aAgent will, without further instructions from any
party other than Buyer, to remit any remaining Funding Deposit to
Buyer. The provisions of this Section 4 are intended to
supplement Sections 4.3, 14.1, and 14.2 of the Agreement in order
to permit payment of the Cash Purchase Price to occur as to
individual Store Properties upon the completion of the Inventory
Count as to such Store Property in the manner described in this
Section 4.
5. Leased Real Property. Section 5.5(c) of the Agreement is
hereby amended to read, in its entirety, as follows:
"(c) Except as provided on Schedule 5.5(c), to Seller's
Knowledge, the current use of, and the manner of operation of the
Business at, the Store Properties does not violate in any
material respect any instrument of record or agreement affecting
any of the Store Properties (including, without limitation, any
restrictions or limitations imposed under the Leases). Except as
provided on Schedule 5.5(c), to Seller's Knowledge there is no
violation of any covenant, condition, restriction, easement,
agreement or Order of any Governmental Entity having jurisdiction
over the Store Properties that affects the use or occupancy
thereof."
6. Indemnification and Indemnity Escrow Amount.
6.1 Indemnity Escrow Amount. The definition of Indemnity Escrow
Amount is hereby amended to read, in its entirety, as follows:
"Indemnity Escrow Amount" means One Seven
Million Five Hundred Thousand Dollars
($71,500,000).
6.2 Survival. Section 16.1 of the Agreement is hereby amended
to change the reference to "eighteen (18) months" therein to
"twelvefifteen (152) months."
6.3 Indemnification Cap. The definition of "Indemnification
Cap" is amended to read, in its entirety, as follows:
"'Indemnification Cap' means Five Million Dollars
($5,000,000)."
and Section 16.3(d) of the Agreement is amended to read, in its
entirety, as follows:
"Notwithstanding any other provision of this Agreement,
the indemnification obligations of Seller under Section
16.2(a)(i) or the indemnification obligations of Buyer
or Parent under Secton 16.2(b)(i) will not exceed an
amount equal to the Indemnification Cap, respectively.
The parties shall be obligated to provide
indemnification for all Indemnifiable Losses that may
be asserted pursuant to Sections 16.2(a)(ii),
16.2(a)(iii), 16.2(b)(ii) and 16.2(b)(iii), as
applicable."
6.4 Duration of Indemnification Escrow. The
duration of the Indemnity Escrow under the Indemnity Escrow
Agreement shall be twelve (12) months from the Closing Date.
7. Purchase Price Adjustment. Section 4.1(a)(i) of
the Agreement is amended to provide that the Asset Purchase Price
is Forty-Four Million Dollars ($44,000,000).
8. Inventory. Section 2.2(c) and Schedule 4.2(b) of
the Agreement are amended as follows:
8.1 Paragraph 8(e) of Schedule 4.2(b) is deleted
in its entirety.
8.2 Paragraph 12 of Schedule 4.2(b) is amended to
provide that in the case of any Inventory which would have been
excluded from the transaction under paragraph 8(e) of Schedule
4.2(b) prior to its deletion by this First Amendment, the
"Retail" price for such Inventory means the lesser of (i) the
retail selling price in effect for such Inventory as of the
Closing Date or (ii) 30% of the "Retail" price of such Inventory
as otherwise determined under paragraph 12 of Schedule 4.2(b).
8.3 Section 2.2(c) is amended to delete from the
first sentence thereof the clause ". . . and quantities of any
item of merchandise at any Store that are materially in excess of
quantities customarily maintained in such Store in the ordinary
course of business . . . ". For purposes of this First
Amendment, quantities of Inventory referred to in the clause
deleted by the preceding sentence are referred to as "Excess
Quantities" of Inventory. Section 12 of Schedule 4.2(b) to the
Agreement is amended to provide that in the case of any "Excess
Quantities" of Inventory as defined in this Section 8.3, the
"Retail" price for such items shall be 75% of what otherwise
would be their "Retail" price under Section 12 of Schedule
4.2(b).
9. Disclosure Schedules. Attached hereto are
supplemental disclosure schedules, which, pursuant to Section
7.6(c) of the Agreement, are deemed to amend the Disclosure
Schedules.
10. Specific Store Property Value Schedule.
Schedule 4.5 to the Agreement is amended to add $50,000 to the
value allocated to each Store Property thereon, other than Store
No. 306, such that the total amount allocated to the several
Store Properties is $44,000,000.
11. Full Force and Effect. Except as modified by this
First Amendment, the Agreement shall remain in full force and
effect.
[Remainder of page intentionally left blank. Signature page
follows.]
IN WITNESS WHEREOF, the Parties, acting through their duly
authorized representatives, have executed this First Amendment as
of the date first above written.
XXXXXXX COMPANIES, INC.
By /s/ Xxxxxxx X. Roof
Name: Xxxxxxx X. Roof
Title: Interim CFO
RAINBOW FOOD GROUP, INC.
By /s/ Xxxxxxx X. Xxxxxxxx
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President and
Secretary
XXXXXX'X, INC.
By /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Executive Vice President
RBF CORP.
By /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: President
1.1
FIRST AMENDMENT TO DISCLOSURE SCHEDULES
INDEX
Schedule 1.1(a) Acquired Contracts
Schedule 2.1(j) Intellectual Property and Trademarks
Schedule 4.4 Allocation
Schedule 5.5(b) Eminent Domain Proceedings
Schedule 5.5(c) Covenants and Easements
Schedule 5.8 Claims, Litigation and Disputes
Schedule 5.9 Acquired Contracts
Schedule 5.11 Taxes
Schedule 5.13(a) Employee Benefit Plans
Schedule 5.13(b) Union Pension Plan Liability
Schedule 5.13(c) Employees
Schedule 5.14 Environmental Matters
Schedule 5.19 Cure Costs
Schedule 7.2 Conduct of the Business Pending Closing
THE ABOVE-DESCRIBED SCHEDULES ARE OMITTED FROM THIS FILING
PURSUANT TO ITEM 601(B)(2) OF REGULATION S-K. THE REGISTRANT,
XXXXXX'X, INC. HEREBY AGREES TO FURNISH A COPY OF SUCH SCHEDULES
TO THE COMMISSION UPON REQUEST.
EXHIBIT A
INVENTORY SCHEDULE
A. Commence Inventory Count June 6, 2003
Store - 54
Store - 70
Store - 66
Store - 59
Store - 68
Store - 74
b. Commence Inventory Count June 7, 2003
Store - 44
Store - 48
Store - 76
Store - 53
Store - 78
Store - 62
c. Commence Inventory Count June 8, 2003
Store - 61
Store - 15
Store - 217
Store - 58
Store - 56
Store - 12
d. Commence Inventory Count June 9, 2003
Store - 75
Store - 26
Store - 34
Store - 28
Store - 50
Store - 11
e. Commence Inventory Count June 10, 2003
Store - 52
Store - 60
Store - 72
Store - 55
Store - 67
Store - 51
f. Commence Inventory Count June 11, 2003
Store - 306
Store -
Store -
Store -
Store -
a. Commence Inventory Count June 12, 2003
Store -
Store -
Store -
Store -
Store -
a.
EXHIBIT B
PURCHASE PRICE CERTIFICATION
Store _________
Asset Purchase Price $______________
Inventory Purchase Price $______________
Cash on Hand $______________
Cure Costs <$_____________>
Delinquent Sales & Property Taxes<$_____________>
Net Prorations $______________
Total Payable By Buyer $______________
Indemnity Escrow Amount1<$_____________>
Purchase Price Escrow Amount2<$_____________>
Net payable to Seller3 $______________
Approved:
Xxxxxxx Companies, Inc., an
Oklahoma corporation and Rainbow
Food Group, Inc., a Nevada
corporation
By
Date
RBF Corp., a Wisconsin corporation
and Xxxxxx'x Inc., a Wisconsin
corporation
By
Date
EXHIBIT C
ESCROW AGREEMENT
PURCHASE PRICE FUNDING ESCROW AGREEMENT
THIS PURCHASE PRICE FUNDING ESCROW AGREEMENT (the
"Agreement") is made as of this ___ day of June, 2003 by and
among Bank One Trust Company, National Association (the "Escrow
Agent"), Xxxxxx'x, Inc., a Wisconsin corporation ("Xxxxxx'x"),
RBF Corp., a Wisconsin corporation (the "Buyer"), Xxxxxxx
Companies, Inc., an Oklahoma corporation ("Xxxxxxx") and Rainbow
Food Group, Inc., a Nevada corporation ("Rainbow" and together
with Xxxxxxx, "Seller").
RECITALS:
WHEREAS, Xxxxxx'x, Buyer, Xxxxxxx, and Rainbow are parties
to an Asset Purchase Agreement dated as of May 2, 2003, as
amended by a First Amendment to Asset Purchase Agreement dated as
of June __, 2003 (the "First Amendment") (as amended, the
"Purchase Agreement") pursuant to which Buyer has acquired
certain of the assets and assumed certain of the liabilities of
Seller in exchange for certain consideration as provided therein,
and Xxxxxx'x has guaranteed Buyer's obligations thereunder and
certain other obligations (the "Asset Purchase");
WHEREAS, the Purchase Agreement provides that, as a
condition to the Asset Purchase, the Seller will enter into this
Purchase Price Funding Escrow Agreement, as a means of providing
a fund from which to pay Seller the Estimated Cash Purchase Price
(as such term is defined in the Purchase Agreement) with respect
to those stores identified on Exhibit A to the First Amendment,
whose inventory count commences on June 6, 2003 or June 7, 2003
(the "Applicable Stores").
AGREEMENT:
NOW THEREFORE, in consideration of the mutual covenants and
agreements contained herein and in the Purchase Agreement,
and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the
parties agree as follows:
1. Definitions. All capitalized terms used herein shall have
the meanings set forth in the Purchase Agreement unless otherwise
defined herein.
2. Appointment of the Escrow Agent. Xxxxxx'x, Buyer and
Seller hereby designate and appoint Bank One Trust Company,
National Association, as the Escrow Agent hereunder, and Bank One
Trust Company, National Association, hereby accepts such
appointment and agrees to act as the Escrow Agent in accordance
with the terms, conditions and provisions of this Escrow
Agreement.
3. Creation of Escrow Fund. On the date hereof, Buyer
shall deliver to the Escrow Agent, by wire transfer, pursuant to
Section 4.4 of the First Amendment, the aggregate sum of
_________________ Dollars ($__________), representing a portion
of the Estimated Cash Purchase Price under the Purchase Agreement
applicable to the Applicable Stores (the "Escrow Fund"). The
Escrow Agent agrees to hold the Escrow Fund pursuant to the terms
and conditions of this Agreement. References to the Escrow Fund
shall include the outstanding balance of the Escrow Account, as
adjusted to reflect interest earned thereon, less disbursements
therefrom made in accordance with this Escrow Agreement. During
the term of this Agreement, unless otherwise instructed in
writing by notice given jointly by Buyer and Seller, the Escrow
Agent shall make no disbursement of funds in the Escrow Account,
except as provided in this Agreement.
4. Investment of Escrow Fund; Earnings.
(a) Investment. The Escrow Agent shall invest and
reinvest the Escrow Fund only in (a) notes or bills of the United
States of America, (b) other short term obligations of, or
obligations guaranteed by, the United States of America, or an
instrumentality or agency of the United States of America, (c)
commercial paper rated prime by Xxxxx'x Investor Service or A-1
by Standard and Poor's Corporation, or (d) one or more money
market funds consisting primarily of the foregoing instruments,
promptly in accordance with the written instructions of Buyer and
Seller jointly given to the Escrow Agent from time to time, upon
the terms and conditions set forth in this Escrow Agreement. In
the absence of any instruction to the contrary, the Escrow Fund
shall be invested in accordance with the instructions set forth
on Schedule A attached hereto. All funds held by the Escrow
Agent pursuant to this Agreement shall constitute trust property
for the purposes for which they are held. The parties recognize
and agree that the Escrow Agent will not provide supervision,
recommendations or advice relating to either the investment of
moneys held in the Escrow Account or the purchase, sale,
retention or other disposition of any investment. The Escrow
Agent is hereby authorized to execute purchases and sales of
investments through the facilities of its own trading or capital
markets operations or those of any affiliated entity.
(b) Earnings. Income and interest realized on such
investments of the Escrow Fund shall be retained by the Escrow
Agent and shall be added to and become a part of the Escrow Fund
hereunder, to be held and disbursed in accordance with the terms
of this Agreement and the Purchase Agreement. Xxxxxx'x, Buyer
and Seller, will provide the Escrow Agent with appropriate IRS
Forms W-9, or such other income tax reporting information, as the
Escrow Agent may reasonably request. The Escrow Agent shall not
have any obligation to prepare or file any returns with the IRS
with respect to any interest or other investment income earned on
the Escrow Fund.
(c) Disposition of Securities. At the time that the
Escrow Agent shall be required to make any payment under this
Escrow Agreement, the Escrow Agent shall liquidate the
investments permitted hereunder to the extent necessary to make
such payment in a manner that the Escrow Agent deems likely to
minimize losses, penalties, or brokerage costs suffered in
connection with such liquidation.
5. Release of Escrow Fund. Promptly upon receipt by the
Escrow Agent of a certification, executed by Buyer and Seller,
itemizing the sums to be disbursed from the Escrow Fund pursuant
to Section 4.4 of the First Amendment, and authorizing such
disbursement, the Escrow Agent shall pay the sums indicated in
such certification to the parties identified in such
certification via wire transfer of immediately available funds to
the applicable account designated in the certification (subject
to Section 6(g) below). Immediately after the payment of the
amounts set forth on such certification, the Escrow Agent shall
disburse to Buyer, any remaining amounts, including interest
thereon. The Escrow Agent shall not disburse any portion of the
Escrow Fund, except as provided in this Section or to a successor
Escrow Agent, if applicable.
6. Responsibilities of the Escrow Agent.
(a) General. The Escrow Agent's duties and
responsibilities, in its capacity as such, shall be limited to
those expressly set forth in this Escrow Agreement, and the
Escrow Agent shall not be subject to, nor obliged to recognize,
any other agreement between any or all of the parties hereto even
though reference thereto may be made herein, except to the extent
that definitions contained in the Purchase Agreement are
incorporated in this Agreement. This Agreement may not be
amended at any time in such a way as to affect the rights,
responsibilities, obligations, liabilities or fees of the Escrow
Agent except with the Escrow Agent's written consent, as
evidenced by an instrument in writing signed by Buyer, the Escrow
Agent and Seller. The Escrow Agent shall be under no duty to
interpret the terms of the Purchase Agreement, but shall rely
solely on the notices and directions of the parties pursuant to
this Agreement.
(b) No Obligation to Confirm. The Escrow Agent shall
not be liable for confirming the identity, authority or rights of
any person, firm or corporation executing or delivering or
purporting to execute or deliver this Agreement.
(c) Reliance. The Escrow Agent may rely in good faith
upon any instrument in writing presented to it and shall not be
liable or responsible for any action taken or omitted in
accordance with the provisions thereof.
(d) Attachment, Garnishment or Levy. In the event any
property held by the Escrow Agent hereunder shall be attached,
garnished or levied upon under any court order, or if the
delivery of such property shall be stayed or enjoined by any
court order, or if any court order, writ, judgment or decree
shall be made or entered affecting such property or affecting any
act by the Escrow Agent, the Escrow Agent shall obey and comply
with such writ, order, judgment or decree so entered or issued,
notwithstanding any provision of this Escrow Agreement to the
contrary. If the Escrow Agent obeys and complies with any such
writ, order, judgment or decree, it shall not be liable to any of
the parties hereto or to any other person, firm or entity by
reason of such compliance, notwithstanding that any such writ,
order, judgment or decree may be subsequently reversed, modified,
annulled, set aside or vacated.
(e) Indemnification of Escrow Agent. Subject to the
final sentence of this Section 6(e), Buyer and Seller hereby
agree to indemnify and hold harmless the Escrow Agent against any
and all losses, claims, damages, liabilities and expenses,
including, without limitation, reasonable costs of investigation
and reasonable counsel fees and disbursements (at both the trial
and appellate levels) which may be imposed on the Escrow Agent or
incurred by it in connection with its acceptance of this
appointment as Escrow Agent hereunder or the performance of its
duties hereunder, including, without limitation, any litigation
arising from this Agreement or involving the subject matter
hereof; provided that Buyer and Seller shall not indemnify the
Escrow Agent for losses, claims, damages, liabilities and
expenses arising from the gross negligence of or intentional
misconduct by the Escrow Agent or the Escrow Agent's breach of
this Agreement. Indemnification of the Escrow Agent hereunder
shall survive termination of this Agreement. One-half of any
amounts payable under this Section 6(e) shall be paid by Seller
and the other half shall be paid by Buyer.
(f) Escrow Agent's Fees and Expenses. The Escrow
Agent shall, upon submission to Buyer and Seller of a reasonably
detailed itemized statement thereof, be reimbursed for all
reasonable expenses, disbursements and advances (including
reasonable attorneys' fees and expenses) incurred or made by it
in performance of its duties hereunder, and shall be paid its
fees in accordance with the fee schedule set out as Schedule B
hereto. One-half of the Escrow Agent's fee, disbursements,
expenses and advances, if any, shall be paid by Buyer, and one-
half shall be paid by Seller. Subject to approval of the
Bankruptcy Court and applicable bankruptcy law, the Escrow Agent
shall have, and is hereby granted, a prior lien upon any
property, cash, or assets of the Escrow Fund, with respect to its
unpaid fees, nonreimbursed expenses and unsatisfied
indemnification rights, superior to the interests of any other
persons or entities. The Escrow Agent shall be entitled and is
hereby granted the right to set off and deduct any unpaid fees,
nonreimbursed expenses and unsatisfied indemnification rights
from amounts on deposit in the Escrow Fund.
(g) Resignation. The Escrow Agent may resign and be
discharged from its duties hereunder at any time by giving
written notice of such resignation to Seller and Buyer specifying
a date (not less than thirty (30) days after the giving of such
notice) when such resignation shall take effect. Promptly after
such notice, Buyer and Seller mutually shall appoint a successor
escrow agent, such successor escrow agent to become the Escrow
Agent hereunder upon the resignation date specified in such
notice. If Buyer and Seller are unable to agree upon a successor
escrow agent within thirty (30) days after such notice, the
Escrow Agent shall be entitled to petition the Bankruptcy Court,
for so long as the Bankruptcy Cases are proceeding, and upon
completion of the Bankruptcy Cases, any court of competent
jurisdiction for the appointment of a successor escrow agent.
The Escrow Agent shall continue to serve until its successor
accepts the Escrow Fund. Buyer and Seller may agree at any time
to substitute a new escrow agent by giving notice thereof to the
Escrow Agent then acting.
(h) Further Instructions. From time to time on or
after the date hereof, Buyer and Seller shall deliver or cause to
be delivered to the Escrow Agent such further documents and
instruments, or cause to be done such further acts, as the Escrow
Agent may reasonably request in order to enable the Escrow Agent
to carry out more effectively the provisions and purposes of this
Escrow Agreement, to evidence compliance with this Agreement or
to assure itself that it is reasonably protected in acting under
this Agreement.
(i) Disputes. In the event that (i) any dispute shall
arise between the parties with respect to the disposition or
disbursement of any of the assets held hereunder or (ii) the
Escrow Agent shall be uncertain as to how to proceed in a
situation not explicitly addressed by the terms of this Agreement
whether because of conflicting demands by the other parties
hereto or otherwise, the Escrow Agent shall be permitted to
interplead all of the assets held hereunder into the Bankruptcy
Court, so long as the Bankruptcy Cases are proceeding, and upon
completion of the Bankruptcy Cases, into a court of competent
jurisdiction, and thereafter be fully relieved from any and all
liability or obligation with respect to such interpleaded assets.
The parties hereto other than the Escrow Agent further agree to
pursue any redress or recourse in connection with such a dispute,
without making the Escrow Agent a party to the same.
(j) Limited Liability. IN NO EVENT SHALL THE ESCROW
AGENT BE LIABLE, DIRECTLY OR INDIRECTLY, FOR ANY (i) DAMAGES OR
EXPENSES ARISING OUT OF THE SERVICES PROVIDED HEREUNDER, OTHER
THAN DAMAGES WHICH RESULT FROM ITS GROSS NEGLIGENCE, BAD FAITH,
OR WILLFUL MISCONDUCT, OR (ii) SPECIAL OR CONSEQUENTIAL DAMAGES,
EVEN IF THE ESCROW AGENT HAS BEEN ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES. The Escrow Agent may consult with counsel and
shall be fully protected with respect to any action taken or
omitted by it in good faith on advice of counsel.
(k) Litigation. If the Escrow Agent becomes involved
in litigation on account of this Agreement, except as a result of
a breach by Escrow Agent of this Agreement, it shall have the
right to retain counsel and, subject to approval of the
Bankruptcy Court and applicable bankruptcy law, shall have a
first lien on the property deposited hereunder for any and all
costs, attorneys' fees, charges, disbursements, and expenses in
connection with such litigation; and shall be entitled to
reimburse itself therefor out of the property deposited
hereunder, and if it shall be unable to reimburse itself from the
property deposited hereunder, the parties hereto jointly and
severally agree to pay to the Escrow Agent on demand its
reasonable charges, counsel and attorneys' fees, disbursements,
and expenses in connection with such litigation. The Escrow
Agent shall have the right to perform any of its duties hereunder
through agents, attorneys, custodians or nominees.
(l) Successor Entity to Escrow Agent. Any banking
association or corporation into which the Escrow Agent may be
merged, converted or with which the Escrow Agent may be
consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Escrow Agent shall be a
party, or any banking association or corporation to which all or
substantially all of the corporate trust business of the Escrow
Agent shall be transferred, shall succeed to all the Escrow
Agent's rights, obligations and immunities hereunder without the
execution or filing of any paper or any further act on the part
of any of the parties hereto, anything herein to the contrary
notwithstanding.
7. Miscellaneous Provisions.
(a) Notices. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed
to have been duly given when personally delivered, delivered by
overnight courier or transmitted by facsimile, or five days after
mailed, certified or registered mail, with postage prepaid
addressed as follows (or to such other person or address as the
party to receive such notice may have designated from time to
time by notice in writing pursuant hereto):
If to Seller to: Xxxxxxx Companies, Inc.
0000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Attention: General Counsel
Facsimile: (000) 000-0000
with copies to: McAfee & Xxxx
Tenth Floor, Two Leadership Square
000 Xxxxx Xxxxxxxx
Xxxxxxxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxx
Xxxxxxx X. Xxxxx
Facsimile: (000) 000-0000
If to Buyer to: Xxxxxx'x, Inc.
00000 Xxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxx,
Vice President, Secretary and Treasurer
Facsimile: (000) 000-0000
with a copy to: Xxxxx Xxxxxxxxxxx Xxxxx S.C.
000 Xxxx Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxx
Facsimile: (000) 000-0000
If to the Bank One Trust Company, National
Association
Escrow Agent to: 000 Xxxx Xxxxxxxxx Xxxxxx
Mail Code WI1-2054
Xxxxxxxxx, XX 00000
Attention: Global Corporate Trust
Services,
Xxxxxx X. Xxxxx
Facsimile: (000) 000-0000
(b) Waiver and Amendment. Any provision of this
Agreement may be waived at any time by the party that is entitled
to the benefits thereof. No waiver, amendment or supplement
shall be effective unless in writing and signed by all the
parties hereto.
(c) Entire Agreement. This Agreement, together with
the provisions of the Purchase Agreement that are incorporated by
reference herein, constitutes the entire agreement between the
parties hereto with respect to the transactions contemplated
hereby and supersedes all prior agreements among the parties with
respect to these matters.
(d) Severability. Any term or provision of this
Agreement which 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 or affecting the validity or enforceability of any of
the terms or provisions of this Agreement in any other
jurisdiction. If any provision of this Agreement is so broad as
to be unenforceable, the provision shall be interpreted to be
only so broad as is enforceable.
(e) Binding Effect; Assignment. This Agreement shall
be binding upon and inure to the benefit of the parties hereto
and their respective heirs, legatees, assigns and transferees, as
the case my be. Neither this Agreement nor any rights, duties or
obligations hereunder shall be assigned by any party hereto
without the prior written consent of the other parties, and any
attempted assignment or transfer without such prior written
consent shall be null and void.
(f) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of
Minnesota without giving effect to the conflicts of law
principles thereof.
(g) Jurisdiction and Venue. Subject to Sections
17.3(a) and 17.13 of the Purchase Agreement, any dispute between
the parties hereto relating to this Agreement shall be resolved
by final binding arbitration in accordance with the Commercial
Arbitration Rules of the American Arbitration Association
("AAA"), to be conducted in Hennepin County, Minnesota. To the
extent they are available, arbitrators shall be selected from the
AAA with food industry experience. In any dispute involving a
claim in excess of $1,000,000, three arbitrators shall be
employed. Absent a showing of good cause, the hearing shall be
conducted within ninety (90) days from the service of the
statement of claim. All proceedings shall be governed by the
Federal Arbitration Act. Each party shall bear the expense of
their own attorneys, experts and out of pocket costs as well as
fifty percent of the expense of administration and arbitrator
fees. The parties agree that the arbitrators SHALL NOT HAVE THE
POWER TO AWARD PUNITIVE OR EXEMPLARY DAMAGES UNLESS THE
ARBITRATOR(S) or a court of competent jurisdiction determines
that this limitation, under the circumstances, violates public
policy. Depositions, other than those taken in lieu of live
testimony, shall not be taken except upon the arbitrator(s)
finding of special need. The parties shall be entitled to
conduct document discovery in accordance with a procedure where
responses to information requests shall be made within twenty
days (20) from their receipt. Each party shall be entitled to
pursue remedies for emergency judicial relief in any court of
competent jurisdiction, except that immediately following the
preliminary adjudication of such request for emergency relief,
the parties hereby consent to a stay of the judicial proceedings
pending a determination of the dispute on the merits by
arbitration as herein provided.
(h) Interpretation. The descriptive headings
contained in this Agreement are for convenience of reference only
and shall not affect in any way the meaning or interpretation of
this Agreement.
(i) Remedies Cumulative. Except as otherwise provided
herein, each and all of the rights and remedies in this Agreement
provided, and each and all of the rights and remedies allowed at
law and in equity shall be cumulative, and the exercise or resort
to any and all other rights or remedies provided in this
Agreement or at law or in equity shall not diminish or otherwise
affect the rights and remedies provided in this Agreement.
(j) Counterparts. This Agreement may be executed in
one or more counterparts, each of which shall be deemed to be an
original, but all of which together shall constitute a single
agreement.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have caused this Purchase
Price Adjustment Escrow Agreement to be executed by their duly
authorized officers or representatives as of the date first above
written.
XXXXXXX COMPANIES, INC. XXXXXX'X, INC.
By: ___________________________ By:
___________________________
Name: ___________________________ Xxxxxx X.
Xxxxx, Executive Vice
Title: ___________________________ President and
Chief Financial Officer
RAINBOW FOOD GROUP, INC. RBF CORP.
By: ___________________________ By:
___________________________
Name: ___________________________ Xxxxxx X.
Xxxxx, President
Title: ___________________________
BANK ONE TRUST COMPANY,
NATIONAL ASSOCIATION,
as Escrow Agent
By: _____________________________
Name: _____________________________
Title: _____________________________
SCHEDULE A
INSTRUCTIONS TO ESCROW AGENT
Pursuant to Section 4(a) of the Purchase Price Adjustment
Escrow Agreement, Buyer and Seller hereby instruct Escrow Agent
to invest the Escrow Funds as follows:
____ Notes or bills of the United States of America.
____ Other short term obligations of, or obligations
guaranteed by, the United States of America, or an
instrumentality or agency of the United States of
America.
____ Commercial paper rated prime by Xxxxx'x Investor
Service or A-1 by Standard and Poor's Corporation.
____ One Group Government Money Market Fund, Class I Shares,
or any successor fund.
These instructions shall remain in effect until Escrow Agent
is instructed otherwise in the manner specified in the Agreement.
XXXXXXX COMPANIES, INC. XXXXXX'X, INC.
By: ___________________________ By:
___________________________
Name: ___________________________ Xxxxxx X.
Xxxxx, Executive Vice
Title: ___________________________ President and
Chief Financial Officer
RAINBOW FOOD GROUP, INC. RBF CORP.
By: ___________________________ By:
___________________________
Name: ___________________________ Xxxxxx X.
Xxxxx, President
Title: ___________________________
SCHEDULE B
ESCROW AGENT FEE SCHEDULE
RE: Purchase Price Adjustment Escrow Agreement
One-Time Fee $500.00
Annual Administration Fee $0.00
Out-of-pocket Expenses:
Out-of-pocket expenses may be charged at cost to cover
ordinary business expenses for postage, checks, stationery,
printing, messenger deliveries, and telephone. Expenses for
extraordinary services such as, but not limited to, travel,
legal securities delivery, and legal notice publication will
also be added.
Extraordinary Time Charges $200 per hour (see below)
Additional Terms and Conditions:
The fees quoted in this letter apply to services ordinarily
rendered in the administration of an Agency Account and are
subject to reasonable adjustment based on final review and
acceptance of documents, or when the Agent is called upon to
undertake unusual duties or responsibilities, or as changes
in law, procedures, or the cost of doing business demand.
Services in addition to and not contemplated in the
agreement, including but not limited to document amendments
and revisions, non-standard cash and/or investment
transactions, calculations, notices, and reports, and
default administration will be billed as Extraordinary Time
Charges.
Upon a client's direction, cash balances will be invested in
any one of the following:
Cash balances may be invested in The One Group Money
Market Funds in which event Bank One will charge a 0
basis point (.0000) cash management fee. The One Group
will pay Banc One Investment Advisors Corporation, an
affiliate of BANK ONE, an investment advisory fee as
described in the prospectuses.
Cash balances may be invested in an alternative short-
term investment fund in which event Bank One will
charge a 25 basis point (.0025) cash management fee.
Unless otherwise indicated, the above fees provide for the
establishment of one account. Additional sub-accounts
governed by the same escrow agreement may be established at
an additional charge of $250 per account.
The Acceptance Fee and the first year Annual Administration
Fee are payable upon execution of the escrow documents. In
the event the escrow is not funded, the Acceptance Fee and
all related expenses will not be refunded. Annual
Administration fees cover a full year in advance, or any
part thereof, and thus are not pro-rated in the year of
termination.
In determining the general schedule of fees, Bank One takes
into consideration the various incidental benefits accruing
to it from the operation of the accounts. Collected funds
must be on deposit prior to disbursement of payments. In
addition, Bank One has the use of funds deposited to pay
checks that have not yet been presented for payment. No
interest shall be paid to the client on these funds, it
being understood that the float on these funds is considered
in the calculation of our fees.
_______________________________
1 To be remitted to Bank One, National Association, as Escrow
Agent under Indemnity Escrow Agreement dated June ___, 2003.
2 To be remitted to Bank One, National Association, as Escrow
Agent under Purchase Price Adjustment Escrow Agreement dated
June ____, 2003.
3 To be remitted to Seller by wire transfer.
