EXHIBIT 2.1
ASSET PURCHASE AGREEMENT
PARTIES: INTERGRAPH CORPORATION ("Seller")
Xxxxxxxxxx, Xxxxxxx 00000-0000
XXXXXXXXXX INDUSTRIES, INC. ("Buyer")
0000 Xxxxxxxx Xxx Xxx Xxxx
Xxxxxx, Xxxxxx 00000
THIS IS AN AGREEMENT ("Agreement") for the purchase of substantially all of
the assets of the printed circuit board manufacturing business of Seller.
RECITALS:
WHEREAS, Seller is a Delaware corporation owning and operating a division
engaged in the business of manufacturing and selling printed circuit boards at
Building 16, One Madison industrial Park, Madison, Alabama ("Seller's
Business"); and
WHEREAS, Buyer is an Oregon corporation duly authorized to transact
business of the same nature as Seller's Business; and
WHEREAS, Seller desires to sell to Buyer and Buyer desires to purchase from
Seller, Seller's right, title and interest in and to substantially all of the
assets of Seller's Business (excluding certain assets described below) subject
only to the permitted exceptions and those liabilities expressly assumed in this
Agreement.
NOW, THEREFORE, in consideration of the mutual promises and undertakings
exchanged in this Agreement, and other good and valuable consideration, the
receipt and sufficiency of which are acknowledged, the parties agree as follows:
AGREEMENT:
SECTION 1. SALE OF ASSETS.
1.1 Assets Sold and Purchased. On the Closing Date (as hereinafter defined)
Seller shall sell, transfer, assign and convey free and clear of all
liabilities, liens and other encumbrances, except for the Permitted Exceptions
shown on Schedule 1.1 and as expressly assumed in this Agreement, and Buyer
shall purchase, all of Seller's right, title and interest in and to all of the
assets and properties which are or will be owned, used or acquired for use by
Seller's Business at and as of the Closing Date of this agreement (collectively
the "Purchased Assets"), including but not limited to the following assets:
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1.1.1 a leasehold or fee interest in the real property, including
buildings, structures and improvements located thereon, fixtures contained
therein and appurtenances attached thereto as depicted on Schedule 1.1.1,
parking for 450 automobiles, some of which parking may be provided by
granting Buyer an exclusive easement which shall be for the term of Buyer's
Lease and, if Buyer acquires fee title to the Real Estate, which shall be
perpetual, to property contiguous to the Real Estate located in the areas
depicted on Schedule 1.1.1, together with a perpetual, nonexclusive
easement giving reasonable ingress and egress thereto from Wall Xxxxxx
highway, and consent to an identification sign not exceeding 32 square feet
at the corner of Interpro Road and Intergraph Way (the "Real Estate"). The
legal description of the Real Estate depicted on Schedule 1.1.1 shall be
used in the conveyance of the Real Estate;
1.1.2 all raw material, work-in-process and finished product
inventories, supplies, spare parts and shipping ,containers and materials
owned, used or acquired for use by Seller's Business, including but not
limited to that which is listed on Schedule 1.1.2 (the "Inventory and Work
in Process");
1.1.3 all machinery, equipment and other items of tangible personal
property owned, used or acquired by Seller's Business including but not
limited to any machinery, tools, fixtures, dies, molds, jigs, patterns,
parts, supplies, furniture, furnishings, equipment, and computers
(including hardware and software programs, licenses and maintenance
agreements), including but not limited to those which are listed
on-Schedule 1.1.3;
1.1.4 to the extent relating to Seller's Business, (i) all operating
data and records, including but not limited to customer and vendor lists,
product lists and credit information, (ii) permits (to the extent
transferable), and computer programs and licenses; and all other similar
intangible personal property and rights;
1.1.5 all equipment to be added, and services to be provided, by
Seller as of the Closing Date related to telecommunications, janitorial,
building maintenance and computer networking, as set forth on Schedule
1.1-5.
1.2 Leases of Personal Property. Seller shall assign to Buyer all of the
leases set forth in Schedule 1.2 by appropriate instrument. Seller will also
obtain the respective lessor consents where required by contract. Buyer shall
assume such
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leases and hold Seller harmless from all obligations under such leases due after
the Closing Date.
1.3 Assets Excluded. Notwithstanding Sections 1.1 and 1.2, the Purchased
Assets shall not include the items listed on Schedule 1.3.
1.4 Purchase Price.
1.4.1 [Intentionally omitted.]
1.4.2 Real Estate. In consideration of the lease, sale, transfer,
assignment and conveyance of the Real Estate, Buyer shall, subject to the
terms and conditions of this Agreement, pay to Seller as the price for the
Real Estate the sum of $10.2 million.
1.4.3 Purchased Assets Other Than Real Estate. In consideration of the
sale, transfer, assignment and conveyance of Purchased Assets other than
the Real Estate, Buyer shall, subject to the terms and conditions of this
Agreement, pay to Seller as the purchase price for the Purchased Assets
other than the Real Estate, the following.
1.4-3.1 For all Purchased Assets other than Real Estate, inventory and
work in process of Seller's Business, the sum of $5 million.
1.4.3.2 For Inventory and Work in Process of Seller's Business, the
fair market value of the foregoing as of the Closing Date. Fair market
value shall be (i) raw materials shall be valued at the last purchase price
for such materials; (ii) work in process shall be valued by the percentage
of completion of the purchase order in accordance with Schedule 1.4-3.2
attached hereto, multiplied by 80% of the sales price (finished goods are
assumed to be complete), from which will be deducted $300,000. Prior to the
Closing Date the parties shall jointly conduct a physical inventory.
1.5 Payment. Payment of the purchase price for the Purchased Assets (the
"Total Purchase Price") shall be made in the following manner:
1.5.1 The Total Purchase Price, plus or minus customary prorations,
credits or adjustments, shall be paid to Seller by wire transfer at the
time of the Closing.
1.5.2 Prorations, credits and adjustments
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shall be made as of the Closing, and shall include, without limitation,
real estate and personal property taxes, utilities, if not read, premiums
And all other customary prorations applicable to a sale of real estate. Any
required meters to cause the facility to be independent of surrounding
buildings shall be @t the expense of Seller. Meter readings for all
utilities shall be obtained by Seller on the date prior to Closing.
Property taxes shall be prorated at the time of Closing based upon the most
recently available xxxx and shall be adjusted upon the issuance of a final
xxxx. Seller shall comply with the terms of all state and local tax laws
and shall pay all taxes relating to or arisina from the sale of the
Seller's Business to Buyer, including, but not limited to, retail
occupation tax, income tax and property taxes. Seller shall have no
responsibility of continued abatement from property taxes for any Purchased
Assets.
1.6 Seller's Warranty.. Seller warrants the personal property which is the
subject of this Agreement to be in good working condition, and the building and
other fixtures to be in good serviceable condition, suited to the purposes for
which the Purchased Assets are employed in Seller's Business, subject to the
exceptions shown on Schedule 1.6.
SECTION 2. CLOSING.
2.1 Closing Date and Time. Closing shall be at 9:00 A.M on March 24, 1998
("Closing Date" or "Closing") at the offices of Seller, or at such time and
place as the parties shall mutually agree. Transfer of the Purchased Assets
shall be deemed to have occur at the commencement of business on the Closing
Date.
2.1.1 Extension of Closing Date by Buyer. Buyer may extend the Closing
to 9:00 A.M. on March 31, 1998 by giving notice of such extension to
Seller.
2.1.2 Extension of closing Date by Seller. Seller may extend the
Closing to 9:00 A.M. on March 31, 1998 by giving notice of such extension
to Buyer.
2.1.3 Extension of Closing Date for Other Reasons. In the event the
waiting periods under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act
applicable to this Agreement have not expired by March 24, 1998 or by the
appropriate subsequent date if the Federal Trade Commission ("FTC")
requests additional information from a party hereto, the Closing Date shall
be extended until five days after such waiting periods have expired. In the
event the FTC opposes the transactions
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contemplated by this Agreement, this Agreement shall terminate without any
liability of any party, except that Seller is obligated to return all sums
deposited by Buyer with Seller.
2.2 Seller's Closing Documents. On or before the Closing Date, Seller shall
deliver to the Buyer each of the following:
2.2.1 A Xxxx of Sale and appropriate forms of assignment necessary to
sell, transfer, assign and convey the Purchased Assets to be transferred to
Buyer pursuant to this Agreement free and clear of all liabilities, liens
and other encumbrances not expressly assumed by Buyer or permitted pursuant
to this Agreement;
2.2.2 All of the documents pertaining to the sale of the Real Estate
including, but not limited to the instrument of transfer, the survey, the
Title Commitment, and the title insurance policy (or a marked-up Title
Commitment);
2.2.3 A certificate signed by Seller affirming that the
representations and warranties of Seller set forth in this Agreement are
true and correct as of the Closing date;
2.2.4 A written opinion of Seller's counsel as provided in this
Agreement;
2.2.5 Resolution of Seller's directors approving this Agreement and
the transactions contemplated by this Agreement;
2.2.6 The Phase I written environmental report as provided for in this
Agreement;
2.2.7 An executed Requirements Contract in the form attached hereto as
Schedule 2.2.7;
2.2.8 All other items or documents which may be required or
appropriate in connection with consummation of transactions contemplated
hereby.
2.3 Buyer's Closing Documents. On the Closing Date, Buyer shall deliver to
Seller the following:
2.3.1 A wire transfer payable to Seller in the amount of the Total
Purchase Price plus or minus the prorations, credits and adjustments set
forth-in this Agreement;
2.3.2 A certificate of Buyer affirming that the representations and
warranties of Buyer in this
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Agreement are true and correct as of the Closing Date, a written opinion of
Buyer's counsel as provided in this Agreement, a resolution of Buyer's
directors approving this Agreement'- and the transactions contemplated by
this Agreement, an executed Requirements Contract in the form set forth in
Schedule 2.2.7;
2.3.3 All other items or documents which may be required or
appropriate in connection with consummation of transactions contemplated
hereby, including appropriate documents to evidence Buyer's assumption of
the obligations listed in Schedules 1.2 and 4.2.
2.4 In the event Buyer does not close in breach of the terms of this
Agreement, all sums deposited with Seller shall be forfeited to Seller and
this Agreement shall automatically terminate.
SECTION 3. COVENANTS AND OBLIGATIONS OF SELLER.
3.1 Indemnity. Except as provided in Sections 1.2, 4.2 and 5.7, Seller
agrees that it will indemnify, defend and hold Buyer harmless and Seller will
pay for any liabilities, obligations,, claims, demands, costs or expenses
including reasonable attorney's fees arising from (i) closing or consummation
based on any inaccuracy in any representation or the breach of any warranty or
covenant of Seller under this Agreement and, (ii) Seller's ownership and
operation of Seller's Business prior to the Closing Date, including without
limitation, the following:
3.1.1 Severance, accrued vacation pay or other termination related
payments due employees terminated by Seller prior to the date of Closing,
provided that Buyer shall pay the vacation pay accruing after December 1997
for all employees of Seller's Business hired by Buyer;
3.1.2 All outstanding commitments and obligations of any kind and
nature of Seller relating to the Seller's Business;
3.1.3 Sales, use, income, and other federal, foreign, state, county,
local or other tax of Seller;
3.1.4 All claims by Seller's customers relating to defective, damaged,
returnable or unusable goods or services, customer claims or any promises
or representations made by Seller in connection with-the conduct of its
business;
3.1.5 All other debts, claims, liabilities,
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obligation or contracts;
3.1.6 All other liabilities and obligations arising from the acts of
Seller or the conduct of Seller's Business prior to the time of Closing
which are or may be transferred by operation of law to Buyer;
3-1.7 All liabilities and obligations arising from the failure to
comply with all applicable statutes, including but not limited to any bulk
sales laws or orders, rules and regulations promulgated by governmental
authorities relating in any material respect to the financial condition,
business, operations or prospects of Seller, including, without limitation,
all such items relating to wages, hours, hiring, promotion, retirement,
working conditions, air, water, solid or liquid waste pollution,
nondiscrimination, health, safety, pensions, benefits, the production,
processing, advertising and sales of products' of the business, trade
regulation, antitrust, zoning and land use, warranties and control of
foreign exchange laws;
3.1.8 All liabilities and expenses arising out of or in any way
connected with environmental matters, waste and toxic materials storage and
disposal matters; and
3.1.9 All liability and expense associated with the litigation
identified in Schedule 7.18.
Notwithstanding the foregoing, (i) Seller shall not be required to make any
payment with respect to any claim for indemnification until the total claims for
indemnification made by Buyer exceeds $25,000, (ii) in no event shall the
indemnification obligations of Seller hereunder exceed the amount of the Total
Purchase Price, and (iii) Seller's indemnity obligation in respect of a breach
of Seller's warranty in Section 1.6 shall be limited to the cost of repairing or
replacing the personal property, the building or other fixture as the case may
be. The indemnification rights and remedies available to Buyer under this
Section 3.1 shall be the sole and exclusive rights of Buyer with respect to any
post Closing breach of this Agreement or acquisition of the Purchased Assets,,
and Buyer shall have no claim for special, consequential, exemplary or punitive
damages.
3.2 Cooperation. Seller and Buyer agree to cooperate and assist each other
in transferring the Purchased Assets to Buyer and seeking approval of any
entities the approval of which is reasonably necessary to accomplish the goals
of this Agreement. Seller further agrees to provide accounting records related
to Seller's Business, such as supply and customer information not located on the
Real Estate, from time to time as Buyer may reasonably request.
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3.3 Non-Competition. Seller covenants, warrants and agrees that during a
period of five years from the date of Closing, it shall not directly or
indirectly solicit- the customers listed in Schedule 7.16 for printed circuit
board fabrication business; nor will it solicit -for employment any employee of
Buyer as of the Closing Date for a period of two years without first obtaining
the prior written consent of Buyer. Design of printed circuit boards is not
soliciting sale of printed circuit boards.
3.3.1 Seller acknowledges and agrees that the restrictions contained
in this covenant are reasonable and necessary in order to protect the
Buyer's legitimate interest and that any violation would result in
irreparable injury to Buyer. Seller is aware and acknowledges that this
non-competition restriction is fair and reasonable and not injurious to the
public in limiting free competition, but is made to protect the valuable
rights Buyer is acquiring. Further, Seller acknowledges and agrees that
absent the protection afforded Buyer by this non-competition restriction,
Buyer would not be willing to purchase the Seller's Business. Seller
acknowledges that it has received full and adequate consideration in
connection with the foregoing restrictions.
3.3.2 Seller acknowledges and agrees that in the event of any
violation of this covenant, Buyer shall be authorized and entitled to
obtain injunctive relief from any court of competent jurisdiction, without
the necessity of posting a surety bond, as well as to obtain an equitable
accounting of all profits or benefits arising out of any violation of this
covenant. These rights and remedies shall be cumulative and in addition to
any other rights or remedies which Buyer may be entitled under this
Agreement, including the right to damages directly or indirectly sustained
by Buyer.
3.3.3 In the event that any of the covenants or agreements in this
section are held to be, in any respect, an unreasonable restriction upon
Seller or are otherwise invalid, for any reason, then the court so holding
shall reduce and is so authorized to reduce, the territory to which the
covenant or agreement pertains or the period of time to which the covenant
or agreement operates, or both, or to effect any other change to the extent
necessary to render any of the restrictions contained in this clause
enforceable.
SECTION 4. COVENANTS AND OBLIGATIONS OF BUYER.
4.1 Indemnity. Buyer assumes and agrees to indemnify and hold Seller
harmless from any and all liabilities, obligations,
PAGE 8 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
claims, demands, costs and expenses including reasonable attorney's fees arising
out of any of the following
4.1.1 Any inaccuracy in any representation or the breach of any
warranty or covenant of Buyer under this Agreement;
4.1.2 Any material failure of Buyer to timely perform or observe any
term or condition of the leases assumed pursuant to this Agreement.
4.1.3 Buyer's failure to pay or perform any obligation under Sections
1.2, 4.2 and 5.7.
4.1.4 Buyer's ownership and operation of the Purchased Assets.
4.1.5 Buyer shall protect, defend, indemnify and hold Seller harmless
against any and all claims, demands and losses arising out of Buyer's due
diligence and investigation prior to Closing of the Purchased Assets.
Notwithstanding the foregoing, Buyer shall not be required to make any payment
with respect to any claim for indemnification until the total claims for
indemnification made by Seller exceeds $25,000. In no event shall the
indemnification obligations of Buyer hereunder exceed the amount of the total
Purchase Price. The indemnification rights and remedies available to Seller
under this Section 4.1 shall be the sole and exclusive rights of Seller with
respect to any breach of this Agreement or acquisition of the Purchased Assets,
and Seller shall have no claim for special, consequential, exemplary or punitive
damages.
4.2 Buyer Not Assuming Liabilities. Except as stated in this Agreement,
Buyer is acquiring only the Purchased Assets, and this Agreement shall not be
construed to constitute the assumption of, and Buyer shall not be responsible
for any liabilities of or claims against Seller, or any liabilities or other
obligations related to or arising out of the Seller's Business prior to Closing,
other than those obligations specifically described and assumed by Buyer in this
Agreement. Buyer shall assume and pay the obligations set forth on Schedule 4.2.
SECTION 5. JOINT AND SEVERAL COVENANTS AND OBLIGATIONS OF
SELLER AND BUYER.
5.1 Additional Instruments. Subsequent to the Closing, each party agrees to
execute and deliver such instruments and take such other action as shall be
reasonably required in order
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to carry out the transactions contemplated by this Agreement.
5.2 [Intentionally deleted.]
5.3 Performance of outstanding Purchase Orders. Buyer shall perform all
outstanding customers' purchase orders accepted by Seller in the ordinary course
of business.
5.4 Supply Circuit Boards. On or before the Closing Date Buyer and Seller
shall have entered into a Requirements Contract for the purchase of printed
circuit boards.
5.5 Solicit Material Sent to Suitors/Enforcement and Assignment of
Confidentiality Agreements. From and after the date of the execution of this
Agreement, Seller shall use its best efforts to obtain the return of any
information regarding the Seller's Business which was forwarded to other suitors
of Seller's Business (the "Suitors"). Seller shall continue to enforce the
confidentiality agreements entered into by and between Seller and the Suitors
and shall at Closing assign such confidentiality agreements to Buyer. A list of
the Suitors and such confidentiality agreements is set forth in Schedule 5.5.
5.6 Xxxx-Xxxxx-Xxxxxx Act. Seller and Buyer shall cooperate in making
applications for approval in compliance with the Xxxx-Xxxxx-Xxxxxx Act.
5.7 WARN Act. Buyer shall hire at least 90% of the full time employees of
Seller engaged in Seller's Business, and shall provide Seller at least two days
before the Closing Date with a list of any employees of Seller's Business which
Buyer will not hire. From and after the Closing Date Buyer shall not take any
action that will cause Seller liability under the Worker Adjustment and
Retraining Notification Act, and shall defend and indemnify Seller from any
liability thereunder.
5.8 Exclusivity. From and after the execution of this Agreement up to and
including the Closing Date Seller shall not negotiate with any third party as to
the sale of the Purchased Assets.
5.9 Certain Sums Received. Promptly upon receipt Seller shall pay Buyer all
sums received under any of the contracts assumed by Buyer for the periods after
Closing. Promptly upon receipt Buyer shall pay Seller all sums received in
respect to accounts receivable or relating to Seller's Business which are
created prior to Closing and in respect to contracts relating to Seller's
Business which are not assumed by Buyer.
SECTION 6. PROVISIONS APPLICABLE TO SALE OF REAL ESTATE.
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6.1. Buyer's Lease. At Closing, Seller shall lease to Buyer and Buyer shall
lease from Seller the Real Estate pursuant to a lease containing the following
the general terms and conditions among others ("Buyer Lease"):
6.1.1. The term shall be co-extensive with the remaining term of the
Lease Agreement between Seller and the Industrial Development Board of the
City of Madison, Inc. (the "TDB") dated June 12, 1973 and recorded in Deed
Book 479 Page 19 Judge of Probate, as amended (the "TDB Lease").
6.1.2. Rent shall be $1 per year.
6.1.3. Buyer shall have all incidents of ownership of the Real Estate
during the term, including responsibility for all taxes, insurance and
maintenance.
6.1.4. Buyer shall have the option to enter into a new lease for the
Real Estate at the expiration of the term for a period of 73 years which
shall otherwise be on the same terms and conditions as contained in Buyer's
Lease.
6.1.5. Buyer shall have the right to freely assign and mortgage its
interest under Buyer's Lease.
6.2. Subdivision. Seller at its expense agrees to use diligent good faith
efforts to obtain during 1998 all required governmental approvals for the
subdivision of the Real Estate, including any required surveys, applications and
attendance at meetings of governmental authorities. Buyer agrees to cooperate
with Seller's efforts in this regard, provided that Buyer shall have no
obligation to incur any out-of-pocket expense in connection therewith.
6.3. IDB Approvals. In the event the Real Estate is subdivided as provided
above, Seller shall use diligent good faith efforts to obtain from the IDB any
reasonably requested consents to the partial assignment to Buyer of the IDB
Lease as it relates to the Real Estate or the release of the Real Estate from
the IDB Lease, at Buyer's option. Upon Obtaining the necessary consent or
release, Seller will partially assign or convey to Buyer, as applicable,
Seller's right, title and interest in and to the Real Estate.
6.4. IDB Estoppel. Seller shall-provide Buyer with an estoppel certificate
from IDB stating that the bonds mentioned in the Lease have been fully paid and
retired, IDB will subordinate to Buyer's financing without condition, the
sublease to Buyer is approved, Buyer is entitled to occupy the Real Estate in
place of
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Seller (subject to the terms of the Lease), the Lease is in full force and
effect without default, subject to compliance with law Buyer is entitled to
exercise the option to purchase the real estate described in the Lease under the
terms and conditions specified in the Lease, and such other terms as may
reasonably be required by Buyer.
6.5. SNDA. Seller agrees to execute any commercially reasonable agreement
in recordable form, containing among other provisions, Seller's consent to any
subleasehold or leasehold mortgage and agreeing to recognize such mortgagee as
the subtenant or tenant upon foreclosure.
6.6. Parking and Access Easements. The Seller's instrument of conveyance of
the parking and access easements shall provide that the Buyer shall be
responsible for the maintenance and repair of the easement areas resulting from
the use thereof by Buyer, its invitees and licensees and shall contain mutual
indemnities for property damage and personal injury caused by negligence by the
other party.
6.7. [Intentionally Omitted.]
6.8 Applicability. The terms and conditions of this subsection shall apply
to a conveyance or lease of the Real Estate on the Closing Date.
6.8.1 Conveyance of Title. At the Closing, Seller shall deliver to
Buyer a Buyer's Lease or limited or statutory warranty deed to the Real
Estate. All state, county and local transfer and conveyance taxes,
including documentary stamp taxes, shall be paid by Seller at or prior to
the date of Closing. Buyer shall pay recording taxes. Title or Buyer's
leasehold to the Real Estate shall be marketable and free from all liens,
claims and encumbrances except the Permitted Exceptions. In addition, the
lease or the instrument of conveyance shall contain provisions in which
Buyer agrees to protect, defend, indemnify and hold Seller harmless from
and against any and all claims, losses, damages and expenses (including
reasonable attorney and other legal fees) arising out of Buyer's violations
of Environmental Laws or the presence of Hazardous Substances on the Real
Estate after the Closing Date which provisions shall cover the matters
addressed in Section 7.27.
6.8.2 Survey. No later than ten days prior to the date of Closing of
the Real Estate, Seller shall provide Buyer, at Seller's sole cost and
expense, a current survey (dated not more than six months before the date
of this Agreement) of the Real Estate (the "Survey") certified and in favor
of Buyer, and Buyer's Lender (if required by Buyer's Lender) and the title
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insurer (which Survey shall be acceptable to the title company and which
Qualifies as an ALTA certified completion survey), and which sets forth the
following:
6.8-2.1 The legal description, covenants, restrictions of record,
all recorded easements shown in the Title Commitment (identifying
easements and rights-of-way by endorsement on the Survey of the
recording data of the instruments creating the same) and the
dimensions and total area of the Real Estate;
6.8-2.2 Interior lot lines, if any, dimensions and location of
the improvements, access to public roads or highways, and the location
of adjoining streets; and
6.8-2.3 Building and setback lines, proximity of abutting streets
(reflecting no gaps, gores, or strips) and width thereof.
6.8.3 Preliminary Title Evidence; Title Policy. As soon as possible,
but no later than the Closing Date, Seller shall deliver to Buyer a title
commitment (the "Title Commitment") for an owner's leasehold title
insurance policy (ALTA-1990 Type Form B) from the title company, in the
amount of no less than the purchase price of the Real Estate, covering the
interest Buyer is acquiring in the Real Estate, showing Buyer's estate
vested in Seller subject only to the Permitted Exceptions. Seller shall pay
the premium for title insurance. The Title Commitment shall contain an
extended coverage endorsement over or deletion all standard general
exceptions 1-5 contained in Schedule B of the Title Commitment, and
endorsements in the form attached hereto as Schedule 6.8.3. Seller shall
also furnish the Title Company an Affidavit of Title in customary form
covering the Closing Date representing that nothing has occurred since the
date of the Title Commitment which adversely affects title to the Real
Estate. An owner's leasehold title insurance policy issued by the title
company (the "Title Insurance Policy") in the form and substance as the
Title Commitment, but showing title in the name of Buyer and deleting the
standard exceptions shall be delivered to Buyer at Closing.
6.8.4 If the Title Commitment or Survey discloses either unpermitted
exceptions or survey defects which would render title unmarketable and that
are not approved by Buyer (herein referred to as "Survey Defects"), Seller
shall, at its sole expense have ten days from the date of delivery thereof
to have the exceptions removed from the Title Commitment or to correct such
Survey Defects or, if the Buyer in its sole discretion approves of same, to
have the title insurer satisfactorily commit to insure against loss or
damage that may be occasioned by such exceptions or Survey Defects
(including a
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commitment insure over such exceptions or Survey Defects in any future title
insurance policies for Buyer or any transferee or successor of Buyer, regardless
of the amount of insurance stated in the policies). Notwithstanding anything to
the contrary, Buyer will not be required to close until it has received the
Title Commitment, Title Insurance Policy (or a marked-up Title Commitment as
required above) and Survey which conform to requirements above.
6.8.5 Possession and Closing. Seller shall deliver possession of the
real estate to Buyer on the Closing Date.
6.8.6 Continuing Obligations of Seller. Seller covenants agrees that
between the date hereof and the Closing Date it shall:
6.8.6.1 Maintain any and all insurance coverage presently in
effect with respect to the Real Estate, including policies of public
liability, property damage and fire insurance;
6.8.6.2 Maintain the Real Estate in substantially its present
condition;
6.8.6.3 Not permit anyone except Seller and Related Entities to
occupy or use the Real Estate or any port ion thereof for any reason
whatsoever, except Buyer and its agents for purposes of investigation;
and
6.8-6.4 Not enter into any agreement which will be an obligation
affecting the Real Estate subsequent to the Closing without Buyer's
prior written consent.
6.9 Risk of Loss and Condemnation. Until delivery of the deed (or lease as
the case may be) and consummation of the 'Closing of the Real Estate, the risk
of loss shall be upon Seller. If the Real Estate is damaged by fire or casualty
the cost of repair of which would exceed $1 million, or condemnation proceedings
are commenced against the Real Estate between the date hereto and date of
Closing which would result in an award in excess of $100,000, Buyer may
immediately terminate its proposed purchase of the Purchased Assets. If Buyer
does not elect to terminate the purchase and sale of the Purchased Assets
pursuant to the foregoing sentence, then the purchase and sale of the Purchased
Assets shall be consummated, and the insurance proceeds or rights to proceeds
under existing insurance policies or the condemnation proceeds or rights to
receive condemnation proceeds, as the case may be, shall be assigned -to Buyer
without recourse and Seller shall have no obligation or liability with respect
to the amount or sufficiency thereof.
PAGE 14 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
SECTION 7. SELLER'S REPRESENTATIONS AND WARRANTIES.
Seller represents and warrants to Buyer the following:
7.1 Organization, Good Standing, Authority. Seller is a corporation duly
organized, validly existing and in good standing under the laws of Delaware, has
corporate power and authority to carry on Seller's Business as it is now being
conducted and to own the Purchased Assets.
7.2 Authority to Perform Agreement. Seller has the corporate power and
authority to enter into, to perform the obligations by Seller under, and to
consummate the transactions and other acts contemplated by this Agreement. The
execution, delivery and performance of this Agreement by Seller and the
transfer, conveyance, assignment and delivery of the Purchased Assets and the
other transactions contemplated in this Agreement have or will have at Closing
been duly and validly authorized and approved-by all requisite corporate action,
including all required approvals of Seller's directors. This Agreement
constitutes the valid and binding obligation of Seller, enforceable in
accordance with its terms. Neither the execution nor the delivery of this
Agreement, nor the consummation of the transactions contemplated by this
Agreement, nor the compliance with or fulfillment of the terms and provisions of
this Agreement will: (i) violate or conflict with the provisions of Seller's
Certificate of Incorporation or Bylaws; (ii) violate, conflict with or
constitute a breach of or default under the provisions of any indenture,
agreement, judgment, decree, order, governmental permit or license, or other
instrument to which Seller is a party or by which Seller is bound;,(iii) result
in the imposition of any lien, charge or encumbrance on the Purchased Assets
other than solely as a result of Buyer's financing; or (iv) require any
affirmative approval, consent, authorization or other order, or action of any
court, governmental authority or regulatory body or of any creditor of Seller
except as specifically contemplated by this Agreement. Provided, however, that
if any such consent or other action is required Seller shall use reasonable
efforts to obtain such consent by Closing. Seller shall also procure the consent
Of customers to the disclosure of data covered by confidentiality agreements.
7.3 Financial Statements. Seller has delivered to Buyer certain historical
financial information of Seller's Business, all of which is true and correct in
all material respects.
7.4 Actions until Closing. Since March 3, 1998, and up to the Closing Date,
Seller has and will operate Seller's Business only in the ordinary course,
including without limitation the following:
PAGE 15 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
7.4.1 [Intentionally omitted.]
7.4.2 Provide no raises or additional compensation, including
incentive compensation or bonuses, to current employees of the Seller,
except those regularly scheduled merit raises or those required by written
contracts;
7.4.3 Operate and pay accounts payable and other liabilities as due in
the ordinary course of business;
7.4.4 Honor-all contracts, obligations and commitments;
7.4.5 Only accept (a) purchase orders from existing customers based
upon similar business practices as existed prior to the date of this
Agreement for delivery not exceeding normal delivery cycles; and (b)
purchase orders from new customers providing for delivery of product only
with customary profit margins and in amounts not exceeding the sum of
$25,000 for any purchase order except with the prior written consent of the
Buyer, which consent shall not be unreasonably delayed or withheld;
7.4.6 After the date of this Agreement, Seller will not issue a
purchase order for the purchase of materials, supplies, capital equipment
or other amounts in excess of $50,000 or for a term of more than six
months, without first obtaining the prior approval of the Buyer;
7.4.7 Not enter into any contracts or leases for a term of more than
three months, without first obtaining the prior written consent of Buyer,
which consent shall not be unreasonably delayed or withheld;
7.4.8 Not dispose of any machinery and equipment except in the
ordinary course of business; or
7.4.9 Not otherwise take any action that is not in the ordinary course
of Seller's Business.
7.5 Tax Matters. With respect to Seller's Business Seller has filed all
federal, foreign, state,, county, local and other tax returns and reports
required by law to be filed and all taxes, assessments, fees and other
governmental charges and any related penalties and interest have been paid or
properly reflected or accrued as liabilities of Seller. Seller has no reason to
believe that deficiencies may be asserted for the current or any prior taxable
year.
7.6 [Intentionally omitted.)
PAGE 16 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
7.7 Purchased Assets Complete. The Purchased Assets sold, transferred,
assigned and conveyed to Buyer by Seller pursuant to this Agreement constitutes
all material tangible and intangible personal property employed in the conduct
of Seller's Business, except for those assets specifically excluded by this
Agreement.
7.8 Inventories. Inventory shall reflect the results of the most recent
physical inventory.
7.9 Real Property Owned by Seller. Seller will, at the time of Closing,
have good title or good leasehold interest under the Lease to all of the Real
Estate to be transferred to Buyer hereunder, free and clear of all liens,
security interests or other encumbrances, except for Permitted Exceptions.
7.10 [Intentionally omitted.]
7.11 Purchased Assets Leased by Seller. With respect to Seller's Business,
Seller leases the personal property described in Schedule 7.11. Copies of such
leases have been provided to Buyer. Seller has not breached any covenant of or
received any notice of any default or alleged default under such leases, and, to
the best of Seller's knowledge the leases are valid and binding on the lessor.
7.12 Customer Owned Equipment. Schedule 7.12 contains a complete list of
all customer owned equipment related to Seller's Business in Seller's
possession. All such customer owned equipment shall be undamaged at the time of
Closing. Buyer shall notify Seller at or before Closing of any damage to such
equipment.
7.13 Contracts and Commitments. Schedule 7.13 contains a true, complete and
current list and brief description of all contracts and commitments relating to
Seller's Business requiring the payment of $10,000 or more by Seller, including,
without limitation, long-term purchase contracts, whereby the failure to perform
would have a material adverse effect upon Seller's Business as it is currently
conducted. Schedule 7.13 also contains a true, complete and current list and
brief description of any oral or written agreement or arrangement to which
Seller is a party for the employment of any officer, employee or agent which is
not terminable without cause on not more than 30 days notice, and any oral or
written agreement or arrangement to which Seller is a party with any
distributor, dealer, manufacturer's representative, sales agency, consulting
agreement or advertising contract which is not terminable without cause on not
more than 30 days' notice.
PAGE 17 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
7.14 Contracts and Backlog. Schedule 7.14 contains a true, complete and
current list and brief description of all contracts of Seller relating to
Seller's Business representing open and unfilled orders of Seller in excess of
$10,000, the dollar amounts of such unfilled orders and a listing of all open
and outstanding proposals made by Seller within 60 days prior to the date of
this Agreement.
7.15 Patents and Trademarks Schedule. Schedule 7.15 contains a list of all
patents (including applications for patents), trademarks, trade names, trade
secrets and copyrights owned by or registered in the name of or used by Seller's
Business. Seller owns all such items outright, pays no royalty to anyone under
any of them, has the right to bring actions for any infringement of them and has
not licensed anyone to use any of such items. Seller has no knowledge and has
received no notice to the effect that in the conduct of Seller's Business as it
is presently operated, Seller may infringe any patent, trademark, trade name,
trade secret or copyright of another or that any royalty or license payment is
payable in connection with the manufacturing of any products for third parties
by Seller's Business.
7.16 Customer Lists. Schedule 7.16 contains a true and complete list of the
major customers of Seller's Business. Except for those specifically noted on
Schedule 7.16, no such customer has a dispute with Seller in any material
respect.
7.17 Employee Benefit Plans. Schedule 7.17 contains a true and complete
description of all defined benefit or defined contribution plans (as defined in
the Employment Retirement Income Security Act of 1974, as amended ("ERISA"]),
employment contracts, incentive, bonus, group insurance, disability, employee
welfare, nonqualified deferred compensation, severance or other similar fringe
or employee benefit plans (within the meaning of ERISA), funds,, programs or
arrangements to which Seller is a party in relation to Seller's Business, or
pursuant to which the employees engaged in Seller's Business are covered. Seller
will make available for Buyer's inspection true and correct copies of all
agreements, including trust agreements and insurance contracts, embodying such
contracts, plans, funds, programs or arrangements. With respect to each of the
contracts, plans, funds, programs and arrangements listed on Schedule 7.17,,
Seller has at all times complied with and has taken all steps necessary to
satisfy the requirements prescribed by any and all statutes, orders, or
governmental rules or regulations currently in effect including, but not limited
to, the Internal Revenue Code and ERISA, applicable to such contract, plan,
fund, program or arrangement. Neither Seller nor any of its directors, employees
or agents nor any "party in interest" or "disqualified person," as such terms
are defined in ERISA and Section 4975 of
PAGE 18 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
the Internal Revenue Code, respectively, has engaged in any prohibited
transactions as defined in ERISA or the Internal Revenue Code. Seller has
adequately funded all defined benefit plans to provide for all accrued benefits
to participants and made or will make all contributions and paid or will pay all
amounts due and owing as required by the terms of the contracts, plans, funds,
programs and arrangements listed in Schedule 7.17.
7.18 Litigation and Arbitration. Except as set forth in Schedule 7.18
relating directly or indirectly to Seller's Business, there is no litigation,
arbitration proceeding or governmental investigation pending or to the best of
Seller's knowledge threatened against or relating to Seller in respect to the
Seller's Business as it is presently conducted, or the transactions contemplated
by this Agreement. Buyer assumes no liability or responsibility for such
litigation matters arising or relating to Seller's activities prior to Closing.
Seller shall continue to respond to any inquiries and shall defend any actions,
specifically including, but not limited to the matters set forth on Schedule
7.18. Seller is not a party to or subject to the provisions of any decree or
judgment of any court or of any governmental agency prohibiting the execution of
this Agreement or the transactions contemplated by it.
7.19 Labor Matters. Except as set forth in Schedule 7.19, in respect to
Seller's Business (i) Seller has no collective bargaining or similar agreements
relating to Seller's employees; and (ii) there has been no strike, lockout or
other labor dispute including without limitation, employee discriminations,
notices or actions affecting the Purchased Assets or Seller's Business.
7.20 Permits. Schedule 7.20 contains a true, complete and current list of
all federal, state and local permits, licenses, approvals and franchises which
are owned by, have been received by, or issued in respect to Seller's Business.
Seller has obtained all necessary federal, state and local permits, licenses,
approvals and franchises in connection with the conduct of Seller's Business as
it is presently operated including without limitation all licenses and permits
to fulfill customers purchase orders.
7.21 Product and Service Warranties. Except for Seller's warranties of sale
as reflected on Seller's printed order acknowledgments and other written
contracts in connection with Seller's Business, as set forth in Schedule 7.21,
Seller has not made any express warranties concerning the manufacture and
delivery of any product or the nature or performance of any service.
7.22 Preferential Treatment. Seller, to the best of its knowledge, is not a
party to any contract in connection with
PAGE 19 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
Seller's Business which has teen awarded on the basis of, or is conditioned
upon, any preferential treatment of Seller pursuant to any law, regulation, or
policy of the United States, any state, territory or possession or any
department, agency or political instrumentality of any of them. Such contracts
include, but are not limited to, contracts granted because Seller qualifies as a
small business or because any stockholder, director, officer or employee of
Seller is a veteran, minority group member or socially or economically
disadvantaged person and such contracts specifically include any "set aside" for
a small business or for a socially or economically disadvantaged person pursuant
to the Small Business Administration Act of 1958, 15 U.S.C. Section 631 et seq.
7.23 Conduct of Business in Ordinary Course; No Adverse Change. Except as
disclosed in Schedule 7.23, Seller's Business has been conducted only in the
ordinary and usual course since January 1, 1998. Specifically, but without
limitation, Seller has not entered into any transaction, incurred any liability
or obligation, paid any liability or obligation other than liabilities and
obligations disclosed in its financial statements and those liabilities and
obligations incurred in the ordinary and usual course, nor sold or transferred
any of its assets except, in each case, in the ordinary and usual course of
business. To the best of Seller's knowledge there has been no material adverse
change in the business or operations (existing or propose by Seller) or in the
Purchased Assets, or any event, occurrence, circumstance or combination thereof
which could reasonably be expected to result in a material adverse change in the
same after the Closing of this transaction. In respect to Seller's Business
Seller has in all respects materially performed all of the obligations required
to be performed by it under the terms of its agreements.
7.24 Compliance with Laws; Governmental Authorities. With respect to
Seller's Business, in all material respects Seller has complied with all
applicable statutes, orders, rules and regulations promulgated by governmental
authorities relating in any material respect to the financial condition,
business or operations of Seller, including, without limitation, all such items
relating to wages, hours, hiring, promotion, retirement, working conditions,
air, water, solid or liquid waste pollution, nondiscrimination, health, safety,
pensions, benefits, the production, processing, advertising and sales of
products of the business, trade regulation, antitrust, zoning and land use,
warranties and control of foreign exchange laws. Except as disclosed in Schedule
7.24, in respect to Seller's Business, Seller has neither received any notice of
alleged violation of any such statute, order, rule or regulation nor has
knowledge of any facts or circumstances that could constitute such a violation.
PAGE 20 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
7.25 Conflict of Interest. No officer or director of Seller has, either
directly or indirectly, any beneficial, material interest in any contract or
agreement to which Seller's Business is a party or by which any of them may be
bound nor any controlling interest in any person, firm or corporation that has
such an interest.
7.26 Disclosure. No representation or warranty by Seller and no statement
or certificate furnished or to be furnished by Seller to Buyer pursuant to the
provisions of this agreement, taken as a whole, contains any untrue statement of
a material fact.
7.27 Environmental Issues. Except as disclosed on Schedule 7.27, neither
Seller, nor to the best of Seller's knowledge, any previous owner or operator of
the Real Estate, has handled, buried, stored, retained, refined, transported,
processed, manufactured, generated, produced, spilled, allowed to seep, leak,
escape or xxxxx, or pumped, poured, emitted, emptied, discharged, injected,
dumped, transferred or otherwise disposed of or dealt with Hazardous Substances
with respect to the Real Estate in violation of any currently applicable
environmental laws. Seller further warrants that there has been no seepage,
leak, escape, xxxxx, discharge, injection, release, emission, spill, pumping,
pouring, emptying, dumping, or other release of hazardous substances in
violation of any currently applicable environmental laws from the Real Estate
onto or into any adjacent property or waters. Seller has not received any notice
from any governmental authority of any violation of environmental laws nor any
request for information pursuant to Section 204(e) of CERCLA with respect to the
Real Estate.
7.27.1 "Environmental laws" means all federal, state and local
environmental, health or safety laws or regulations now or hereafter
enacted.
7.27.2 "Hazardous substance" means any toxic or hazardous waste,
pollutants, or substances, including, without limitation, asbestos, PCBS,
petroleum products and by products, substances defined or listed as:
"Hazardous substances" or "toxic substances" in the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 ("CERCLA")
as amended, 42 U.S.C. Section 9601 et seq., "hazardous materials" in the
Hazardous Materials Transportation Act, 49, U.S.C. Section 1802, et seq.,
"hazardous waste" in the Resource Conservation and Recovery Act, 42 U.S.C.
Section 6901 et seq., any chemical substance or mixture regulated under the
Toxic Substance Control Act of 1976, as amended., 15 U.S.C. Section 2601 et
seq., any "toxic pollutant" under the Clean Water Act, 33 U.S.C.
PAGE 21 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
Section 1251 et Seq., as amended, any "hazardous air pollutant" under the
Clean Air Act, 42 U.S.C.. Section 7401 et seq., and any hazardous or toxic
substance or pollutant regulated under any other applicable federal, state
or local environmental laws.
7.28 Brokerage Fees. Except for Xxxx Advisors, Inc. no other person or
entity acting on Seller's behalf has any claim for a brokerage commission,
finder's fee or other like payment in connection with this Agreement or the
transactions contemplated by this Agreement. Seller shall hold Buyer harmless
for any claim from Xxxx Advisors, Inc. for a commission.
7.29 No Other Warranties. Notwithstanding anything to the contrary
contained in this Agreement, it is the explicit intent of each party that
neither Buyer nor Seller are making any representations or warranties
whatsoever, express or implied, except those contained in this Agreement. in
particular, Seller makes no representation or warranty to Buyer with respect to
any financial projection or forecast relating to Seller's Business With respect
to any projection or forecast delivered by or on behalf of Seller to Buyer,
Buyer acknowledges that (i) there are uncertainties inherent in attempting to
make such projections and forecasts, (ii) it is familiar with such
uncertainties, (iii) it is taking full responsibility for making its own
evaluation of the adequacy and accuracy of all such projections and forecasts
furnished to it and (iv) it shall have no claim against Seller with respect
thereto.
SECTION 8. BUYER'S REPRESENTATIONS AND WARRANTIES.
Buyer represents and warrants to Seller the following:
8.1 Organization, Good Standing, Authority. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of Oregon, has
corporate power and authority to carry on its business as it is now being
conducted and to own the properties and assets 'it now owns.
8.2 Authority to Perform Agreement. Buyer has the corporate power and
authority to enter into, to perform the obligations by Buyer under, and to
consummate the transactions and other acts contemplated by this Agreement. The
execution, delivery and performance of this Agreement by Buyer have been duly
and validly authorized and approved by all requisite corporate action, including
all required approvals of Buyer's directors. This Agreement constitutes the
valid and binding obligation of Buyer, enforceable in accordance with its terms.
Neither the execution nor the delivery-of this Agreement, nor the consummation
of the transactions contemplated by this Agreement, nor the compliance with or
fulfillment of the terms and
PAGE 22 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
provisions of this Agreement will: (i) violate or conflict with the provisions
of Buyer's Certificate of Incorporation or Bylaws; (ii) violate, conflict with
or constitute a breach of or default, under the provisions of any indenture,
agreement, judgment, decree, order, governmental Permit or license, or other
instrument to which Seller is a party or by which Seller is bound; or (iii)
require any affirmative approval, consent, authorization or other order, or
action of any court, governmental authority or regulatory body or of any
creditor of Buyer, except as specifically contemplated by this Agreement.
Provided, however, that if any such consent or other action is required Buyer
shall obtain such consent by Closing.
8.3 Brokerage Fees. Buyer shall defend, indemnify and hold Seller harmless
from any claim for a brokerage commission, finder's fee or other like payment
from anyone acting with the consent of Buyer in connection with this Agreement
or the transactions contemplated by this Agreement.
SECTION 9. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER.
All obligations of Buyer under this Agreement are subject to the
fulfillment, prior to or at the Closing, of each of the following conditions:
9.1 The approval of Buyer's counsel of the terms and conditions of
acquisition of the Real Estate, which approval shall not unreasonably be
withheld.
9.2 [Intentionally omitted.]
9.3 [Intentionally omitted.]
9.4 [Intentionally omitted.]
9.5 Seller's Representations and Warranties. The representations and
warranties of Seller contained in this Agreement shall be complete and correct
in all material respects as of the Closing Date.
9.6 Performance by Seller. Seller shall have performed and complied in all
material respects with all agreements, covenants and conditions required by this
Agreement to be performed and complied with by Seller prior to or at the time of
Closing.
9.7 [Intentionally omitted.]
9.8 Opinion of Counsel for Seller. Buyer shall be furnished with the
written opinion of Xxxxx & Xxxxxxx, LLP, counsel for Seller, dated the Closing
Date, in form and substance reasonably satisfactory to Buyer's counsel.
PAGE 23 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
9.9 Approval of Seller's Directors. This Agreement and the transactions
contemplated by this Agreement shall have been approved by the consent of
Seller's directors as required pursuant to the provisions of Seller's
Certificate of Incorporation, By-Laws and law.
9.10 Approval of Corporate Proceedings and Legal Matters by Buyer's
Counsel. All corporate proceedings taken by and all legal matters in connection
with this Agreement and the form of all documents, certificates and other
instruments to be delivered by Seller pursuant to the provisions of this
Agreement shall be approved by or satisfactory to Buyer's counsel.
9.11 Consents and Approvals. Buyer and Seller shall have obtained all
authorizations, consents, waivers, approvals or other action required in
connection with the execution, delivery and performance of this Agreement by
Seller and Buyer, and the consummation by Seller of the transactions
contemplated by this Agreement.
9.12 [Intentionally omitted.]
9.13 Scheduled Information. Seller shall have provided Buyer with all
schedules required under this Agreement and Buyer shall have approved all
information contained in the schedules, which approval shall not unreasonably be
withheld.
SECTION 10. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER.
All obligations of Seller under this Agreement are subject to the
fulfillment, prior to or at the Closing, of each of the following conditions:
10.1 Approval of Buyer's Ability to Meet Its Obligations. Seller shall have
approved Buyer's ability to meet Buyer's financial and operating obligations as
set forth in this Agreement.
10.2 Representations and Warranties of Buyer. The representations and
warranties of Buyer contained in this Agreement shall be complete and correct in
all material respects as of the Closing Date.
10.3 Performance by Buyer. Buyer shall have performed and complied in all
material respects with all agreements, covenants and conditions required by this
Agreement to be performed and complied with by Buyer prior to or at the time of
Closing.
10.4 Opinion of Counsel for Buyer. Seller shall be
PAGE 24 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
furnished with the written opinion of Xxxxxx & Xxxxxxx, P.C., counsel for Buyer,
in form and substance reasonably satisfactory to Seller counsel.
10.5 Approval of Proceedings and Legal Matters by Seller's Counsel. All
Proceedings taken by and all legal matters in connection with this Agreement and
the form of all documents certificates and other instruments to he delivered bv
Buyer pursuant to the provisions of this Agreement shall be approved by or
satisfactory to Seller's counsel.
10.6 Consents and Approvals. Buyer and Seller shall have obtained all
authorizations, consents, waivers, approvals and other action required in
connection with the execution, delivery and performance of this Agreement by
Buyer and Seller, including approval of Seller's directors, and the consummation
by Buyer and Seller of the transactions contemplated by this Agreement. If the
transactions contemplated hereby are not able to close solely because Seller is
unable to close because of Seller's breach, or because Seller is unable to
obtain the consent of Foothill Capital Corp., Seller shall pay Buyer $100,000 as
liquidated damages, which shall be Buyer's sole remedy for such breach.
SECTION 11. GENERAL PROVISIONS.
The following general provisions shall apply to this Agreement:
11.1 Expenses. Except as expressly provided herein, each party shall bear
their own fees and expenses incurred in connection with the preparation,
negotiation and execution of this Agreement including any brokerage or finders
fees. Buyer and Seller shall indemnify and hold each other harmless for any
claims arising out of this Paragraph.
11.2 Notices. All notices, requests, demands or communications to any party
shall be in writing and delivered personally or-by certified mail, return
receipt requested, postage prepaid, as follows:
TO THE SELLER: Intergraph Corporation
Xxxxxxxxxx, XX 00000-0000
Attn: Xxxx X. Xxxxxxxx
WITH COPY TO: Intergraph Corporation
Xxxxxxxxxx, XX 00000-0000
Attn: General Counsel
TO THE BUYER: Xxxxxxxxxx Industries, Inc.
0000 Xxxxxxxx Xxx-Xxx
Xxxxxx, XX 00000
PAGE 25 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
Attn: Chief Financial Officer
WITH COPY TO: Xxxxxxx X. Xxxxxxx
Xxxxxx & Xxxxxxx, P.C.
The 1515 Building
0000 XX Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxxx, XX 00000-0000
Any notice sent to any party shall be sent to all parties, and shall be deemed
to be given when delivered personally to the party to whom it is addressed, or
if mailed in accordance with the terms of this Paragraph, upon deposit in the
U.S. mails.
11.3 Understanding of the Parties. This Agreement comprises the complete
understanding of the parties and there are no understandings, either written or
oral, except as specifically set forth in this Agreement. All prior negotiations
and understandings of the parties are deemed merged into this Agreement.
11.4 Amendment and Waiver. This Agreement may be amended, or any portion of
this Agreement may be waived, provided that such amendment or waiver shall be in
writing, executed by the parties to which any particular provision specifically
relates and all such amendments and waivers made shall be binding upon the
parties. No course of dealing between or among any persons having any interest
in this Agreement shall be deemed effective to modify, amend or discharge any
part of this Agreement or any rights or obligations of any person under or by
reason of this Agreement.
11.5 Inurement of Benefit to Assigns. All of the terms and provisions of
this Agreement shall be binding upon, apply and inure to the benefit of the
parties, their respective successors and assigns. Prior to the Date of Closing
neither party shall assign any interest in this Agreement, except for security
interests.
11.6 Severability. Each of the terms and provisions of this Agreement is
and is deemed to be severable, in whole or in part; and if any non-material term
or provision or application in any circumstance should be invalid, illegal or
enforceable, the remaining terms and provisions or their application, to
circumstances other than those as to which it is held invalid, illegal or
unenforceable, shall not be affected and shall remain in full force and effect.
11.7 Exhibits and Schedules. All Exhibits and Schedules attached to this
Agreement are incorporated and made a part of this Agreement by reference.
PAGE 26 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
11.8 Section Headings. All Section headings are for convenience only and do
not in any way limit or construe the contents of the sections.
11.9 Rights and Remedies. All rights and remedies granted any of the
parties under this Agreement shall be cumulative.
11.10 Survival of Representations and Warranties. All representations and
warranties shall survive the closing of the transactions contemplated by this
Agreement. All claims for indemnification by Buyer shall be brought within the
following time limitations:
11.10.1 Based on a breach of Section 1.6 of this Agreement, within
three months of the Date of Closing.
11.10.2 Based on a breach of any other representations or warranties,
within five years of the Date of Closing.
11.11 Survival of Indemnifications. Except as otherwise provided
hereinabove, all agreements for indemnification made in this Agreement by the
parties shall survive the closing. In the case of any claim made for
indemnification, the party upon whom the claim has been made shall have the
right to pursue an action to settle or resolve any such claim and may employ its
respective counsel of its choice for the defense of any claim made by third
party or the resolution of any such claim.
11.12 Governing Law. The law of Alabama shall govern all questions
concerning the construction, validity and interpretation of this Agreement and
the performance of the obligations imposed by this Agreement.
11-13 Buyer's Continued Cooperation. Buyer agrees to continue to cooperate
with Seller following the Closing Date to provide Seller with information,
documentation and data relating to Seller's Business prior to the date of
closing to enable Seller to prepare its financial statements and income tax
returns and the audit thereof.
11-14 Seller's Continued Cooperation. Seller agrees to continue to
cooperate with the Buyer following the Closing Date with respect to the
procurement of documents contemplated pursuant to this transaction including
without limitation the consents to the assignment of certain contracts and
commitments to the Buyer, specifically including customer contracts, and
software licenses.
11.15 Cross-Reference of Scheduled Information. The
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information provided in one Schedule to this Agreement may be used to satisfy
the information required in another Schedule to this Agreement providing that
the Schedule contains the information requested.
11-16 Delivery of Schedules. All schedules required under this Agreement
shall be furnished to Buyer within ten days from the execution of this Agreement
and reviewed by Buyer within two business days following the day of receipt of
the schedules. Failure of either party to send written approval of the schedules
to the other party within such period shall result in termination of this
Agreement without liability to either party.
11-17 Public Announcements. Prior to the Date of Closing neither party may
make a public announcement regarding the terms of this Agreement without the
prior written consent of the other party. Either party, however, may give such
notices as required by law.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and
year first above written.
SELLER:
INTERGRAPH CORPORATION
By: XXXXXXX X. XXXXX Date: 3/4/98
----------------------------------- --------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
BUYER:
XXXXXXXXXX INDUSTRIES, INC.
By: XXXX XXXXXXXX Date: 3/4/98
----------------------------------- --------------------
Name: Xxxx Xxxxxxxx
Title: President
PAGE 28 ASSET PURCHASE AGREEMENT - FINAL EXECUTION COPY
