Exhibit 10.24
EXECUTION COPY
PURCHASE PRICE ADJUSTMENT AGREEMENT
THIS PURCHASE PRICE ADJUSTMENT AGREEMENT (this "Agreement") is entered
into this twenty-third day of November, 1998, by and among ▇▇▇▇ Computer
Corporation, a Virginia corporation ("▇▇▇▇"), ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, D. ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, all being individual residents of Maryland
(collectively, the "Sellers").
WHEREAS, ▇▇▇▇ and the Sellers entered into an acquisition agreement
(the "Acquisition Agreement") dated March 9, 1998, whereby ▇▇▇▇ acquired all the
outstanding shares of capital stock of International Data Products, Corp., a
Maryland corporation ("IDP"), and certain assets and liabilities of Puerto Rican
Industrial Manufacturing Operations, Corp., a Puerto Rican corporation
("PRIMO"), in exchange for a certain amount of cash and 750,000 shares of common
stock ("Common Stock") of ▇▇▇▇ (the "Purchase Price"),
WHEREAS, Section 1.6 of the Acquisition Agreement provides a mechanism
for either increasing the Purchase Price if the net asset value (net worth) of
IDP and PRIMO as reflected on the Closing Balance Sheet (as defined therein)
exceeds $5,242,634 or decreasing the Purchase Price if the net asset value as
reflected on the Closing Balance Sheet is less than $5,108,826,
WHEREAS, the Sellers have prepared the Closing Balance Sheet and caused
its accountants to review the Closing Balance Sheet in accordance with the
provisions of Section 1.6(c) of the Acquisition Agreement and ▇▇▇▇ has caused
its accountants to review the Closing Balance sheet in accordance with the
provisions of Section 1.6(d) of the Acquisition Agreement, and
WHEREAS, each party desires to fully and finally resolve any and all
issues relating to the Closing Balance sheet and any related adjustments to the
Purchase Price pursuant to the Acquisition Agreement.
NOW, THEREFORE, in consideration of the promises and mutual covenants
contained in this Agreement, it is agreed as follows:
1. NET ASSET VALUE. ▇▇▇▇ and the Sellers, with the assistance of their
respective accountants have fully reviewed all material accounts as set forth on
the Closing Balance Sheet and, based on such complete review of the Closing
Balance Sheet, have hereby determined that the net asset value of the Closing
Balance Sheet is less than $5,108,826, such deficit being referred to herein as
the "Shortfall Amount."
2. PAYMENT OF THE SHORTFALL AMOUNT. In accordance with the provisions
of Section 1.6(b) of the Acquisition Agreement, the Sellers hereby agree to
satisfy the Shortfall Amount by delivering to ▇▇▇▇ 350,000 shares of Common
Stock. The delivery
of shares shall occur by Sellers delivering to ▇▇▇▇ contemporaneously with the
signing of this Agreement an irrevocable stock power in favor of ▇▇▇▇ for an
aggregate of 350,000 shares of Common Stock in the form attached hereto as
Exhibit 2.1, and certificate number DU2 representing 350,000 shares of Common
Stock.
3. PAYMENT IN FULL. ▇▇▇▇ hereby agrees to accept the payment of the
350,000 shares of Common Stock from the Sellers as payment in full for the
Shortfall Amount and agrees that such payment fully discharges the Sellers from
their obligation to pay the Shortfall Amount to ▇▇▇▇ in accordance with Section
1.6(c) of this Agreement, and that ▇▇▇▇ and the Sellers shall have no further
obligations or liabilities pursuant to Section 1.6 of the Agreement.
4. AUDIT OPINION. Sellers hereby agree to deliver to ▇▇▇▇ an executed
copy of the audit opinion of KPMG Peat Marwick, LLP ("KPMG") with respect to its
audit of the Closing Balance Sheet by November 30, 1998, which opinion may be
qualified only with respect to KPMG not having conducted a physical count of the
inventory of IDP and PRIMO as of the date of the Closing Balance Sheet.
5. RELEASE. ▇▇▇▇, for itself and its successors, assigns, affiliates,
predecessors, purchasers, and all other persons acting on its behalf or claiming
under it, including without limitation, its stockholders, directors, officers,
employees and agents (separately and collectively the "▇▇▇▇ Releasors"), agrees
that each of the ▇▇▇▇ Releasors hereby fully and forever irrevocably and
unconditionally releases, remises, acquits, exonerates and discharges each of
the Sellers and their respective partners, employees, agents, affiliates, and
assigns (separately and collectively, the "Fuster Releasees"), of and from any
and all grievances, claims, demands, debts, suits, actions or causes of action,
promises, proceedings, orders, judgments, contracts, allegations, damages,
obligations, liabilities, costs and expenses (including reasonable attorney's
fees) of whatever kind or nature, whether known or unknown, suspected or
unsuspected, both in law or in equity, in any way arising from or relating to
the Settled Matters (as defined in Schedule A attached hereto), which any of the
▇▇▇▇ Releasors ever had, now has, or can, shall or may have in the future
against any of the Fuster Releasees, and that the terms hereof constitute a full
and complete, legally binding final resolution by the parties of the Settled
Matters. ▇▇▇▇ hereby irrevocably covenants to refrain from, directly or
indirectly, asserting any claim or demand, or commencing, instituting or causing
to be commenced, any proceeding of any kind against any Fuster Releasee, based
upon any matter purported to be released hereby.
All rights and obligations set forth in the Acquisition Agreement,
except as specifically provided for above with respect to those representations,
warranties and covenants set forth on Schedule A hereto, shall remain in full
force and effect until they expire pursuant to their terms and all rights and
remedies set forth therein shall remain available to the Parties to the fullest
extent permitted by the Acquisition Agreement. The Parties expressly acknowledge
that nothing herein shall alter the rights and obligations of each Party, or
create any additional right or obligation of any Party, with respect to the
application of the Fusters and IDP for eligibility under the 8(a) Program
administered by
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the U.S. Small Business Administration.
Notwithstanding anything contained in this Agreement to the contrary,
nothing contained herein shall limit in any way the right of ▇▇▇▇ or its
affiliates to pursue any and all actions, legal, equitable or otherwise, against
KPMG.
6. MISCELLANEOUS.
(a) COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which together shall constitute one and the same
instrument.
(b) GOVERNING LAW. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the District of Columbia
without giving effect to the principles of conflicts of laws. This provision
shall not in any way be deemed to amend, modify or rescind Section 9.8 of the
Acquisition Agreement.
(c) NO THIRD-PARTY BENEFICIARIES. This Agreement shall not confer
any rights or remedies upon any person other than the Parties hereto and their
respective successors and permitted assigns.
(d) ENTIRE AGREEMENT. This Agreement (including the documents
referred to herein) constitutes the entire agreement among the Parties, and
supersedes any prior understandings, agreements, or representations by or among
the Parties, written or oral, pertaining in any way to the subject matter
hereof. No modification of this agreement shall be valid unless made in writing
and signed by the parties hereto.
(e) SUCCESSORS AND ASSIGNS. This Agreement shall be binding on and
inure to the benefit of the parties hereto and their respective successors
heirs, personal representatives, and permitted assigns, but will not be
assignable by any party without the prior written consent of the other party.
(f) PUBLIC DISCLOSURE. The Sellers and ▇▇▇▇ shall not make any
disclosure of the subject matter of this Agreement unless (a) required by law
(after providing the other Parties notice of such disclosure); or (b) previously
approved in writing (i) in the case of disclosure by Sellers, by ▇▇▇▇, and (ii)
in the case of disclosure by ▇▇▇▇, by Sellers. For purposes of this Section
6(f), approval by either ▇▇▇▇▇▇ ▇▇▇▇▇▇ or ▇▇▇▇▇ ▇▇▇▇▇▇ shall be deemed to
constitute the approval of the Sellers. Each of the Sellers agrees that, with
respect to any Form 4 filed with the Securities and Exchange Commission in
connection with the transfer of stock contemplated herein, each shall state on
such Form 4 that the transfer of such stock is in connection with this Agreement
and shall submit such forms to ▇▇▇▇ for review prior to the filing thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
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▇▇▇▇ COMPUTER CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title Chief Financial Officer
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D. ▇▇▇▇▇ ▇▇▇▇▇▇
/s/ D. ▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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