EXHIBIT 2.7
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this "Agreement") is made and entered into
as of August 18, 1999 (the "Effective Date") by and among Broadview Injection
Molding, Inc., a Delaware corporation ("Buyer"), Broadview Injection Molding
Co., Inc., an Illinois corporation ("Broadview"), the Cervenka and Hetzel Joint
Venture in Illinois (the "Joint Venture"), Mr. Marvin E. Hetzel, an individual
("Hetzel"), and Mr. Joseph J. Cervenka, Sr., an individual ("Cervenka").
(Broadview, the Joint Venture, Mr. Hetzel and Mr. Cervenka are sometimes
referred to herein individually as "Seller" and, collectively, as "Sellers.")
RECITALS
WHEREAS, Broadview is engaged in the business of manufacturing precision
thermoplastic and thermoset parts for wound electronic components such as
transformers, relays and coils, often referred to as "bobbins," and conducting
custom molding, stamping, insertion and assembly operations at its facilities in
Broadview, Illinois (collectively, the "Business");
WHEREAS, Broadview owns all of the Transferred Assets (as defined in
SECTION 1.1) other than the Real Property (as defined below), which Transferred
Assets are used or useful in the conduct of the Business;
WHEREAS, Messrs. Hetzel and Cervenka, the sole stockholders of Broadview,
indirectly through the Joint Venture own all of the real property used in the
Business, consisting of land and improvements thereon located at 2740-48 South
21st Avenue, Broadview, Illinois (the "Real Property");
WHEREAS, Buyer is a wholly-owned subsidiary of Plastron Industries, Inc., a
Delaware corporation, formed to own the Transferred Assets and operate the
Business following the Closing; and
WHEREAS, Sellers desire to sell and assign to Buyer, and Buyer desires to
purchase and assume from Sellers, the Transferred Assets (including the Real
Property) and the Assumed Obligations (as defined in SECTION 1.4) on the terms
and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants set forth herein and for other good and valuable consideration, the
parties hereto, intending to be legally bound, hereby agree as follows:
ARTICLE I
SALE AND TRANSFER OF ASSETS
1.1 TRANSFERRED ASSETS. Subject to the terms and conditions set forth
herein, at the Closing (as defined in SECTION 2.3), Sellers shall sell, convey,
transfer, assign and deliver to Buyer, and Buyer shall purchase, assume and
acquire from Sellers, all of the assets, properties and rights of Sellers of
every kind, character and description used or useful in the conduct of the
Business, whether tangible or intangible and wherever located, as of the Closing
Date (as defined in SECTION 2.3) (collectively referred to herein as the
"Transferred Assets"), including, without limitation, the
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following Transferred Assets (of which each item is described in detail in the
"Transferred Assets Schedule" attached hereto as SCHEDULE 1.1):
(a) All land, buildings, structures, fixtures and leasehold and other
improvements (including the Real Property);
(b) All machinery, equipment, vehicles, tooling, molds, cranes, tables,
spare parts and tools;
(c) All office supplies and equipment, computers, maintenance supplies and
other similar items;
(d) All inventories;
(e) All accounts and notes receivable;
(f) All prepaid expenses;
(g) All cash;
(h) All of Broadview's right, title and interest in and to those contracts
and agreements (including proprietary agreements with suppliers) set forth on
SCHEDULE 1.1(h), and all right, title and interest in and to purchase or sales
orders, quotes or commitments related to the Transferred Assets or the Business,
whether written or oral;
(i) Copies of all of Sellers' books, records, accounts, correspondence,
production records, employment, payroll, personnel and workers' compensation
records, environmental control records and any other documents relating to the
Transferred Assets or the Business;
(j) All of Broadview's rights under any and all express or implied
warranties from Broadview's suppliers with respect to the Transferred Assets, to
the extent such warranties are transferable by Broadview;
(k) All of Broadview's right, title and interest in and to patents,
trademarks, service marks, trade names and all variants thereof, copyrights,
inventions, customer lists, trade secrets (including processes and software
programs), registrations and applications therefor and works in progress, and
past, present and future causes of action and remedies therefor, including those
set forth on SCHEDULE 3.11;
(l) All of Broadview's right, title and interest in computer programs to
the extent assignable, and other intangibles owned or used by Broadview relating
to the Transferred Assets or the Business and all of the related goodwill;
(m) All claims as to which Broadview is a judgment creditor; and
(n) To the extent assignable, all of Sellers' licenses, permits and
governmental authorizations relating to the Transferred Assets or the Business.
1.2 RETAINED ASSETS. Notwithstanding the terms of SECTION 1.1, the
following assets (collectively, the "Retained Assets") shall be retained by
Sellers, and shall not be sold, transferred or assigned to Buyer:
(a) All minutes books and other ownership records of Sellers;
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(b) Such licenses, permits or other certificates of authority which, by
their terms, are not assignable; and
(c) Any rights of Sellers under this Agreement and any related agreement.
1.3 CUSTOMER ASSETS. Notwithstanding the terms of SECTION 1.1, Broadview
shall sell, convey, assign and transfer only such rights as it may have at the
Closing, if any, to those molds, toolings and inserts used in the Business which
are owned by Broadview customers ("Customer Assets").
1.4 ASSUMED OBLIGATIONS. Effective as of the Closing Date, Buyer shall
assume and shall thereafter pay, discharge or perform in the ordinary course
only the following (collectively, the "Assumed Obligations"):
(a) Those trade payables and liabilities accrued by Broadview in the
ordinary course of business on or before the Closing Date and set forth on the
Assumed Obligations Schedule attached hereto as SCHEDULE 1.4;
(b) Broadview's obligations arising under those contracts and agreements
included in the Transferred Assets as set forth on SCHEDULE 1.1(h); and
(c) Obligations existing as of the Closing Date for the payment by any
Seller of property taxes on the Real Property.
1.5 NO OTHER DEBTS, OBLIGATIONS OR LIABILITIES ASSUMED. Other than the
Assumed Obligations, Buyer shall not assume or be obligated to pay, discharge or
perform any debts, obligations or liabilities of Sellers, whether direct or
indirect, known or unknown, absolute or contingent, and all such debts,
obligations or liabilities shall remain with Sellers, and Sellers shall
indemnify Buyer pursuant to ARTICLE IX against all such debts, obligations or
liabilities (the "Retained Obligations").
ARTICLE II
PURCHASE PRICE AND PAYMENT
2.1 PURCHASE PRICE. In exchange and as consideration for the Transferred
Assets and in full payment of the purchase price therefor, Buyer shall pay to
Sellers the amounts set forth in subsections (a)-(b) below in the manner set
forth therein, subject to adjustment pursuant to the indemnification rights set
forth in ARTICLE IX (collectively, the "Purchase Price"):
(a) Buyer shall pay to Sellers, in cash by certified checks or wire
transfers of immediately available funds, the aggregate amount of One Million
Six Hundred and Forty Thousand Dollars ($1,640,000.00); and
(b) Buyer shall execute and deliver to Broadview within thirty (30) days
after Closing a promissory note in the principal amount equal to One Hundred
Thousand Dollars ($100,000.00) plus Broadview's Working Capital, due six (6)
months after Closing and bearing simple interest from Closing at seven (7)
percent, with interest only payable monthly from Closing, in substantially the
form attached hereto as EXHIBIT A (the "Note"). As used herein, "Working
Capital" shall mean, as of 12:01 a.m. on the Closing Date, the sum of (i) cash,
accounts receivable, inventory and prepaid assets, less (ii) trade accounts
payable and liabilities accrued in the ordinary course of business, all as
determined in accordance with generally accepted accounting principles ("GAAP").
Notwithstanding the foregoing, Buyer will assume obligations existing as of the
Closing Date for the payment by any Seller of property taxes on the Real
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Property as set forth in SECTION 1.4(c), which obligations shall be excluded
from the calculation of Working Capital unless such obligations exceed Fifty
Thousand Dollars ($50,000.00), in which case the excess over $50,000.00 will be
included as a liability in the calculation of Working Capital. In no event
shall Working Capital be less than zero.
2.2 ALLOCATION OF PURCHASE PRICE. The parties shall allocate the Purchase
Price for tax purposes amongst the Transferred Assets as set forth on
SCHEDULE 2.2. The parties shall file their respective tax returns in accordance
with such allocation and shall not take any position or action inconsistent with
such allocation.
2.3 CLOSING. The consummation of the transactions contemplated by this
Agreement (the "Closing") shall take place on August 26, 1999 or as soon
thereafter as possible upon satisfaction of the conditions set forth in
ARTICLE VII (the "Closing Date"), at the offices of Holleb & Coff, 55 East
Monroe Street, Suite 4100, Chicago, Illinois, or at such other date, time and
place as may be mutually agreed upon in writing by the parties. All proceedings
to take place at the Closing shall take place simultaneously, and no delivery
shall be considered to have been made until all such proceedings have been
completed. The Closing shall be deemed to have taken place at 12:01 a.m.
Chicago time on the Closing Date. At the Closing:
(a) Buyer shall pay to Sellers the portions of the Purchase Price set
forth in SECTIONS 2.1(a) AND (b); and
(b) Sellers shall execute and deliver to Buyer a General Instrument of
Conveyance, Transfer and Assignment in the form attached hereto as EXHIBIT B and
all such other instruments and documents of conveyance and assignment as are
requested by Buyer to vest in Buyer title to the Transferred Assets, including
the Real Property. Buyer shall execute and deliver to Sellers an Assumption
Agreement in the form attached hereto as EXHIBIT C, and Sellers and Buyer shall
execute and deliver certificates regarding the representations, warranties and
covenants contained herein.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLERS
Sellers hereby jointly and severally represent and warrant to Buyer as
follows:
3.1 ORGANIZATION AND QUALIFICATION - BROADVIEW. Broadview is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Illinois, is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction in which the character
of its properties or the nature of its business makes such qualification
necessary. Broadview has the requisite corporate power and authority to own,
use or lease its properties and to carry on its business as it is now being
conducted and as it is now proposed to be conducted. Broadview is not in
default in the performance, observation or fulfillment of any provision of its
articles of incorporation or bylaws. All entities merged with and into
Broadview prior to the date hereof (including without limitation Cerzel Tool and
Engineering Co., Inc. and Thermoset Injection Molding Co., Inc.) were duly
organized, validly existing and in good standing under the laws of the State of
Illinois until their respective dates of merger, were duly qualified to do
business as a foreign corporation and were in good standing in each jurisdiction
in which the character of their properties or the nature of their business made
such qualification necessary, and had the requisite corporate power and
authority to own, use or lease their properties and to carry on their business
as was conducted.
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3.2 ORGANIZATION AND QUALIFICATION - JOINT VENTURE. The Joint Venture is
a venture/partnership duly organized, validly existing and in good standing
under the laws of the State of Illinois. The Joint Venture has the requisite
power and authority to own, use or lease its properties and to carry on its
business as it is now being conducted and as it is now proposed to be conducted.
The Joint Venture is not in default in the performance, observation or
fulfillment of any provision of its agreement.
3.3 OWNERSHIP. Other than as relates to the Business, neither Broadview
nor the Joint Venture owns any assets nor conduct any operations.
3.4 AUTHORITY RELATIVE TO THIS AGREEMENT. Each Seller has all requisite
power, authority and capacity to execute and deliver this Agreement and all
related agreements and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement and all related agreements and the
consummation of the transactions contemplated hereby on the part of each Seller
has been duly and validly authorized and no other proceedings on the part of any
Seller are necessary, as a matter of law or otherwise, to authorize this
Agreement, the related agreements or to consummate the transactions so
contemplated. This Agreement has been duly and validly executed and delivered
by each Seller and, assuming this Agreement constitutes a valid and binding
obligation of Buyer, this Agreement constitutes a valid and binding agreement of
each Seller, enforceable against each of them in accordance with its terms,
except as such enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws of general application affecting
enforcement of creditors' rights or by general principles of equity.
3.5 CONSENTS AND APPROVALS; NO VIOLATION. Except as set forth on SCHEDULE
3.5, the execution and delivery of this Agreement and any related agreements by
each Seller, the consummation of the transactions contemplated hereby and/or the
performance by each Seller of their obligations hereunder will not:
(a) conflict with any provision of the articles of incorporation, bylaws,
joint venture agreement or other organizational documents of such Seller;
(b) require any consent, approval, authorization or permit of, or filing
with or notification to, any governmental or regulatory authority;
(c) conflict with, result in the breach of or constitute a default (or
give rise to any right of termination, cancellation or acceleration or
guaranteed payments) under any of the terms, conditions or provisions of any
note, lease, mortgage, license, agreement or other instrument or obligation to
which any Seller is a party or by which any Seller or any of their assets may be
bound, including the Business, except for such defaults (or rights of
termination, cancellation or acceleration) as to which requisite waivers or
consents have been obtained in writing;
(d) conflict with or violate the provisions of any order, writ,
injunction, judgment, decree, statute, rule or regulation; or
(e) result in the creation of any lien, charge or encumbrance upon any of
the Transferred Assets.
3.6 FINANCIAL STATEMENTS. The balance sheet of Broadview as of June 30,
1999 (the "Balance Sheet") and the related statements of income and cash flows
for the twelve-month period then ended (collectively, the "Financial
Statements") are attached hereto as SCHEDULE 3.6. The Financial Statements have
been prepared in accordance with GAAP applied on a consistent basis throughout
the period indicated, and present fairly the financial position of Broadview as
of the end of such fiscal year and the results of operations and cash flows for
such year. From and after the date hereof until the Closing, Broadview will
deliver to Buyer, within fifteen (15) days
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after each month end, monthly unaudited balance sheets and income statements
which, at the time they are delivered to Buyer, will present fairly in all
material respects the assets and liabilities and results of operations of
Broadview as of their respective dates.
3.7 ABSENCE OF CERTAIN CHANGES. Except as set forth on SCHEDULE 3.7,
since June 30, 1999, (i) Broadview has conducted its business only in, and since
such date, has not engaged in any transaction other than according to, the
ordinary and usual course of such business, and, (ii) there has not been (a) any
event, circumstance, condition, development or occurrence causing, resulting in
or having a material adverse effect on the financial condition, business,
prospects, properties or results of operations of either Broadview, the Business
or the Transferred Assets (a "Material Adverse Change"); (b) any change by
Broadview in accounting principles, practices or methods; (c) any labor dispute
or difficulty and no such dispute or difficulty is now threatened; (d) any asset
to the Business sold or disposed of (except inventory sold in the ordinary
course of business), or any asset mortgaged, pledged or subjected to any lien,
charge or other encumbrance; (e) any increase in the compensation payable or
which could become payable by Broadview to employees, distributors, dealers or
sales representatives of the Business; (f) any amendment by Broadview of any
employee benefit plan; (g) any indebtedness incurred by Sellers with respect to
the Business or the Transferred Assets; (h) any loan made or agreed to be made
by Sellers with respect to the Business or the Transferred Assets, nor have
Sellers become liable or agreed to become liable as a guarantor with respect to
any such loan; or (i) any waiver by Sellers of any right or rights of value
related to the Business.
3.8 ABSENCE OF UNDISCLOSED LIABILITIES. Broadview, the Business and the
Transferred Assets have and will have no indebtedness, obligations or
liabilities, whether accrued, absolute, contingent or otherwise and whether due
or to become due, known or unknown, as of date of the Balance Sheet and as of
the Closing Date, which are not reflected or reserved for in the Balance Sheet
or set forth on SCHEDULE 3.8.
3.9 TITLE TO ASSETS. Each Transferred Asset of the type set forth in
Section 1.1(a) to 1.1(g) is set forth and described in detail on SCHEDULE 1.1.
Sellers have and at Closing will have good and marketable title to all
Transferred Assets. The Transferred Assets constitute all of the assets and
interests in assets that are owned or used in or useful to the conduct of the
Business as currently being conducted, other than leased or licensed assets
identified on SCHEDULE 3.9, the Retained Assets and the Customer Assets. All of
the Transferred Assets will be conveyed to Buyer free and clear of restrictions
on or conditions to transfer or assignment, and free and clear of mortgages,
liens, leases, security interests, pledges, charges, encumbrances, equities,
claims, easements, rights of way, covenants, conditions or restrictions or any
other adverse claims or rights whatsoever (collectively, "Liens"), other than
(i) those items set forth on SCHEDULE 3.9, (ii) liens for property taxes not yet
due and payable, (iii) rights of customers with respect to work-in-process under
orders or contracts entered into in the ordinary course of business, and (iv)
immaterial imperfections of title, easements, restrictions, rights of way and
encumbrances (collectively, "Permitted Liens"). Sellers have the absolute and
unrestricted right, power, authority and capacity to transfer the Transferred
Assets to Buyer and, upon Closing, Buyer will acquire from Sellers legal and
beneficial ownership of, good and valid title to, the Transferred Assets, free
from any Lien other than Permitted Liens. At the Closing, except as set forth
on SCHEDULE 3.9, none of the Transferred Assets will be subject to any leasing
arrangement. No employee or agent of Broadview, nor any spouse, child, sibling
or other relative of any employee, owns or has any interest, directly or
indirectly, in any of the Transferred Assets.
3.10 REAL PROPERTY. Set forth on SCHEDULE 3.10 is a complete and
accurate description of the Real Property, including any easements, covenants,
rights of way or similar restrictions. Except as indicated on SCHEDULE 3.10:
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(a) The Joint Venture has, and at the Closing Date will have, good and
marketable fee simple absolute title in and to the Real Property, free and clear
of all title defects, mortgages, pledges, security interests, easements,
conditional sales agreements, liens, restrictions or encumbrances whatsoever
other than Permitted Liens;
(b) Broadview does not own or lease any real property, nor is any real
property used in the Business, other than the Real Property;
(c) Each of the buildings (including roofs) and all fixtures and
improvements located on the Real Property are in good operating condition,
ordinary wear and tear excepted;
(d) Sellers have not received any notice, nor are they aware, that any of
the buildings, structures or other improvements erected on the Real Property, or
the present use thereof, (i) do not conform in all respects with all applicable
zoning and building laws (or does not constitute a legal nonconforming use),
ordinances, regulations or other laws and applicable deed restrictions, or (ii)
encroach on property of others;
(e) Sellers have not received any written or oral notice of any pending
(i) change of such zoning and building laws, ordinances, regulations or other
laws affecting any of such properties, or (ii) condemnation of any such
properties; and
(f) Sellers have not received any notice from any municipal body or other
public authority requiring work to be done or improvements to be made upon any
of the Real Property and have no Knowledge of the enactment or adoption of any
ordinance or resolution by any such body or authority authorizing work or
improvements for which any of the Real Property may be assessed.
3.11 INTELLECTUAL PROPERTY.
(a) Except as set forth on SCHEDULE 3.11, Broadview does not have any
right, title or interest in any Intellectual Property (as defined below) and no
such Intellectual Property is necessary for or used in the Business as now
conducted. With respect to registered patents and trademarks, if any,
SCHEDULE 3.11 contains a list of all jurisdictions in which such patents and
trademarks are registered or applied for and all registration and application
numbers.
(b) "Intellectual Property" includes United States and foreign inventions,
invention disclosures, patents, inventors' certificates, utility models,
trademarks, service marks, trade names, copyrights, mask work registrations,
trade secrets (including processes and software programs), registrations and
applications therefor and works in progress, and past, present and future causes
of action and remedies therefor, customer lists and proprietary arrangements
with vendors of Seller.
(c) Except as disclosed on SCHEDULE 3.11, Broadview owns or has the
unrestricted right to use, free and clear of any rights of others and without
payment to any other party, the Intellectual Property listed on such
SCHEDULE 3.11, and the consummation of the transactions contemplated hereby will
not alter or impair any such items nor the right of the Business to use such
items.
(d) Except as disclosed on SCHEDULE 3.11, Sellers have not received any
communications alleging that Broadview has violated any other person's
Intellectual Property rights or has engaged in unfair competition against such
person. Except as disclosed on SCHEDULE 3.11, Broadview does not now infringe
or misappropriate any third party's Intellectual Property rights and does not
have any liability for any past infringement or misappropriation. Except as
disclosed on SCHEDULE 3.11, no dispute or disagreement involving Broadview
exists or
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is threatened with regard to any third party's Intellectual Property rights,
including any allegation of Intellectual Property infringement or
misappropriation or of any breach or default of an Intellectual Property license
or similar agreement.
(e) To Sellers' Knowledge, (i) no third party is now infringing or
misappropriating any Intellectual Property rights of Broadview or the Business,
and (ii) there has not been any past such infringement or misappropriation.
3.12 ACCOUNTS RECEIVABLE. The accounts receivable reflected on the Balance
Sheet constituted all accounts receivable of the Business as of the date
thereof, other than accounts receivable fully written off as uncollectible as of
such date in accordance with consistently applied prior practice, except as may
be reserved on the Balance Sheet. All such accounts receivable arose from valid
sales made (as opposed to consignments) or services rendered in the ordinary
course of business, and are not subject to any return privileges, set-off or
counterclaim, except as may be reserved on the Balance Sheet. Such accounts
receivable have been collected in full since the date of the Balance Sheet or
remain valid, binding and legally enforceable obligations at their full
respective amounts. All accounts receivable created after the date of the
Balance Sheet up to the Closing will arise from valid transactions in the
ordinary course of business, and will be valid, binding and legally enforceable
obligations and collectible at their full respective amounts.
3.13 INVENTORIES. Broadview has good and marketable title to all of its
inventories of raw materials, work-in-process and finished goods, free and clear
of all Liens. All such inventories (i) consist of items that are usable in the
ordinary course of business for an amount at least equal to the book value
thereto, and (ii) except as set forth on SCHEDULE 3.13, represent quantities,
individually and in the aggregate, not in excess of six month's requirements for
the Business as currently conducted.
3.14 CONTRACTS. Neither Broadview nor the Business has any contract,
agreement, obligation or commitment, written or oral, expressed or implied,
which was not incurred in the ordinary course of business, or involves a
commitment or liability in excess of $10,000, or is for a term of more than one
year or whose terms do not permit cancellation without liability on 30 days'
notice or less (other than obligations which are included in accounts payable),
and has no union contracts, employee, representative or consultant contracts,
loan, credit or other financing agreements, inventory flooring arrangements,
debtor or creditor arrangements, security agreements, licenses, franchise,
manufacturing, distributorship or dealership agreements, leases, or bonus,
health or stock option plans, except for those described on SCHEDULE 3.14 hereto
(collectively, the "Contracts"), copies of all of which have been delivered to
Buyer prior to the execution hereof. As of the date hereof, there exists no
circumstances on Broadview's part and, to Sellers' Knowledge, on the part of any
third party, which would affect the validity or enforceability of any such
Contracts in accordance with their respective terms. Broadview has performed
and complied in all material respects with all obligations required to be
performed to date under, and is not in default (without giving effect to any
required notice or grace period) under, or in breach of, the terms, conditions
or provisions of any Contract. Except for consents to assignment required as
set forth on SCHEDULE 3.5, the validity and enforceability of each Contract
described herein has not been and shall not in any manner be affected by the
execution and delivery of this Agreement or any related agreement or the
consummation of the transactions contemplated hereby. Neither Broadview nor the
Business has any customer sales contract which in the ordinary course would
require future expenditures (including internal costs and overhead) in excess of
reasonably anticipated receipts.
3.15 EMPLOYEE AND LABOR MATTERS.
(a) EMPLOYEES. Except as set forth on SCHEDULE 3.15 hereto, no
stockholder, director, officer or employee of Broadview is presently a party to
any transaction involving the Business,
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including without limitation any contract, loan or other agreement or
arrangements providing for the furnishing of services by, the rental of real or
personal property from or to, or otherwise requiring loans or payments to, any
such stockholder, director, officer or employee, or to any member of the family
of any of the foregoing, or to any corporation, partnership, trust or other
entity in which any stockholder, director, officer or employee or any member of
the family of any of them has a substantial interest or is a partner, officer,
director, trustee, or employee. There is set forth on SCHEDULE 3.15 a list
showing (i) the name, title, date and amount of last compensation increase, and
aggregate compensation, including amounts paid or accrued pursuant to any bonus,
pension, profit sharing, commission, deferred compensation or other plans or
arrangements in effect as of the date of this Agreement, of each officer or
employee of the Business whose salary and other compensation, in the aggregate,
received or accrued is at an annual rate (or aggregated for the most recently
completed fiscal year) in excess of $40,000, as well as any written or oral
employment and/or severance agreements relating to any such persons; (ii) a
description of any and all bonus, pension, profit sharing, commission, deferred
compensation, retirement, savings, thrift, severance, performance, vacation,
holiday, medical, disability life or other welfare or retiree plan or policy or
other plans or arrangements in effect for any employees of the Business as of
the date of this Agreement, except as may be set forth in SCHEDULE 3.16 (ERISA
Plans); (iii) a description of any noncompetition or similar agreements to which
Broadview or the Business or any director, officer or employee is a party; (iv)
all powers of attorney from Broadview or the Business to any person or entity;
and (v) the name of each person or entity authorized to borrow money or incur or
guarantee indebtedness on behalf of Broadview or the Business. Broadview has
delivered to Buyer copies of all written personnel policies, including without
limitation vacation, severance, bonus, profit sharing and commission policies,
applicable to any employees of the Business. All current employees of Broadview
are legally entitled to work in the United States, and Broadview has retained
all required documentation in its records related thereto. Except as set forth
on SCHEDULE 3.15, neither the execution and delivery of this Agreement by
Sellers, nor the consummation by them of any of the transactions contemplated
hereby, or compliance by Sellers with any of the provisions hereof, shall create
any obligation or liability on the part of the Business under any bonus, profit
sharing, deferred compensation or other plan or arrangement in effect as of the
date of this Agreement and the Closing Date.
(b) LABOR. None of the facilities or operations of Broadview or the
Business has been the subject of any strike, work stoppage, boycott, union
organizational effort, unfair labor practice charge or employment discrimination
charge; and no such action is pending or threatened.
3.16 ERISA PLANS.
(a) Each employee pension benefit plan, program, agreement or arrangement
maintained or contributed to by Broadview and/or related in any manner to the
Business or the Transferred Assets ("Plan") which is subject to the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), if any, is set
forth on SCHEDULE 3.16 and such Plan(s) conform in all material respects to all
applicable federal laws; no liability under ERISA or the Internal Revenue Code
of 1986, as amended (the "Code") has been or will be incurred by Broadview with
respect to any Plan (other than for benefits under such Plan); full payment has
been made of all amounts required to have paid as contributions to such Plan(s);
the cost of providing all retirement and post-termination benefits has been
properly accrued and is reflected in the Financial Statements in accordance with
GAAP, including without limitation, Statements of Financial Accounting Standards
87, 106 and 112; there is not in the aggregate any accumulated funding
deficiency with respect to such Plan(s); and the current value of accrued
benefits of each such Plan(s) does not exceed the current value of such Plan's
assets.
(b) Broadview has provided Buyer with copies of the following documents
relating to Plans, or any other plan terminated by Broadview during its
existence, which are subject to ERISA: (i) copies of the plan documents and all
amendments relating thereto; (ii) the most recent
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Form 5500 filed with respect to such plans, including all schedules and
attachments relating thereto; (iii) where applicable, the most recent
determination letters received with respect thereto from the Internal Revenue
Service; (iv) the most recent financial statements and actuarial reports, where
applicable, prepared with respect to such plans; and (v) copies of all
correspondence with the Internal Revenue Service, Pension Benefit Guaranty
Corporation, Department of Labor, or any other governmental agency regarding any
pending dispute or any pending or threatened audit or investigation relating to
any such plan.
3.17 PERMITS. Broadview holds all permits, licenses, franchises,
certificates and authorizations that are required by any governmental agency to
permit it to conduct the Business as now conducted, and all such permits,
licenses, franchises, certificates and authorizations are valid and in full
force and effect. No suspension, cancellation or termination of any of such
permits, licenses, franchises, certificates and authorizations is threatened or
imminent.
3.18 TAXES. Except as set forth on SCHEDULE 3.18:
(a) Sellers ("Filers") have timely filed all returns, declarations,
reports, or information returns or statements relating to Taxes (as defined
below) with respect to the Business or the Transferred Assets, including any
schedule or attachment thereto and including any amendment thereof ("Tax
Returns") that are required to be filed under federal, state, local or foreign
law. All such Tax Returns were complete in all material respects. All Taxes
owed by Filers with respect to the Business or the Transferred Assets (whether
or not shown on any of said Tax Returns) have been paid for all periods for
which Tax Returns have been filed. Neither the Business nor any Seller is
currently the beneficiary of any extension of time within which to file any Tax
Return. No outstanding claim has been made by any authority in a jurisdiction
where Filers do not file Tax Returns that Sellers, the Business or the
Transferred Assets may be subject to taxation by that jurisdiction.
(b) Sellers have withheld and paid all Taxes required to have been
withheld and paid in connection with amounts paid or owing to any employee,
creditor, independent contractor, or other third party.
(c) There is no dispute or claim concerning any Tax liability relating in
any manner to the Business or the Transferred Assets either (i) claimed or
raised by any authority or (ii) as to which Sellers have Knowledge based upon
personal contact or correspondence with any agent of such authority. Broadview
has provided to Buyer all federal, state, local and foreign Tax Returns filed
with respect to Broadview or the Business for taxable periods ended on or after
December 31, 1994, and has disclosed to Buyer those of such Tax Returns, if any,
that have been audited, and those of such Tax Returns, if any, that currently
are the subject of audit. Broadview has delivered to Buyer correct and complete
copies of all Tax Returns, examination reports and statements of deficiencies
assessed against or agreed to by Broadview with respect to Broadview or the
Business since December 31, 1994.
(d) Sellers have not waived in writing any statute of limitations in
respect of Taxes or agreed to any extension of time with respect to a Tax
assessment or deficiency pertaining to it, which waiver or extension is still in
effect.
(e) For purposes of this Agreement, "Tax" or "Taxes" means any federal,
state, county, local or foreign income, gross receipts, license, payroll,
employment, excise, severance, stamp, occupation, premium, windfall profits,
environmental (including taxes under Code Section 59A), customs duties, capital
stock, franchise, profits, withholding, social security (or similar),
unemployment, disability, real property, personal property, sales, use,
transfer, registration, value added, alternative or add-on minimum, estimated,
or other tax of any kind whatsoever, including any interest, penalty, or
addition thereto, whether disputed or not.
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3.19 LITIGATION. Except as set forth on SCHEDULE 3.19, there is no claim,
action or proceeding pending or threatened against or relating to any Seller,
the Business or any of the Transferred Assets before any federal, state,
municipal or other governmental department, commission, court, board, bureau,
agency, instrumentality or other person acting in an adjudicative capacity,
domestic or foreign. There is no basis for any claim, action or proceeding
against or relating to any Seller, the Business or the Transferred Assets.
Neither Sellers, nor any employee of Broadview has been permanently or
temporarily enjoined by any order, judgment or decree of any court or any other
governmental or regulatory authority from engaging in or continuing any conduct
or practice in connection with the Business or the Transferred Assets nor is any
employee of Broadview under investigation by any governmental or regulatory
authority. There is not in existence any order, judgment or decree of any court
or other tribunal or other agency enjoining or requiring any Seller to take any
action of any kind with respect to the Business or the Transferred Assets.
Except as set forth in SCHEDULE 3.19, none of the Sellers nor the Business have
been threatened with any action, suit, proceedings or claim (including actions,
suits, proceedings or claims where its liabilities may be adequately covered by
insurance) for personal injuries allegedly attributable to products sold or
services performed by the Business asserting a particular defect or hazardous
property in any of products of the Business, services or business practices or
methods, nor has any Seller or the Business been a party to or threatened with
proceedings brought by or before any federal or state agency; and there does not
exist any defect or hazardous property, claimed or actual, in any such product,
service, business practice or method, except as reserved for in the Balance
Sheet. None of the Sellers nor the Business is subject to any voluntary or
involuntary proceeding under the United States Bankruptcy Code and none have
made an assignment for the benefit of creditors.
3.20 COMPLIANCE WITH APPLICABLE LAWS. Broadview holds, and has at all
times held, all licenses, permits and authorizations then necessary for the
lawful conduct of the Business, and all such licenses, permits and
authorizations are valid and sufficient for all business now conducted by
Broadview. Sellers have complied with, and are in compliance with, all
applicable laws, orders, rules and regulations promulgated by any federal,
state, municipal or other governmental authority relating to the operation and
conduct of the Business and its properties (including the Real Property), and
there have not been and are not any violations of any such law, order, rule or
regulation, existing or threatened. Sellers have not received any notice from
any authority or person that the Business has been or is being, conducted in
violation of any applicable zoning regulation or order, or other law, order,
regulation or requirement relating to the operation of its business or to its
properties (including the Real Property).
3.21 ENVIRONMENTAL MATTERS.
(a) Except as set forth on SCHEDULE 3.21 hereto:
(i) Sellers and the Business have complied with all
applicable Environmental Laws;
(ii) The Real Property (including soils, groundwater, surface
water, buildings or other structures) is not contaminated with any Hazardous
Substances that may subject Sellers, Buyer, the Business or the Transferred
Assets to liability under any Environmental Law;
(iii) All properties formerly owned or operated by the Sellers
are not contaminated with Hazardous Substances that may subject Sellers, Buyer,
the Business or the Transferred Assets to liability under any Environmental Law;
(iv) Neither Sellers nor the Business are subject to liability
under any Environmental Law for any Hazardous Substance disposal or
contamination on any third party property;
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(v) Neither Sellers nor the Business have caused or
contributed to any release or threat of release of any Hazardous Substance that
may subject Sellers, Buyer, the Business or the Transferred Assets to liability
under any Environmental Law;
(vi) Sellers have not received any notice, demand, letter,
claim or request for information alleging that Sellers, the Business or the
Transferred Assets may be in violation of, or liable under, any Environmental
Law;
(vii) Neither Sellers, the Business nor the Transferred Assets
are subject to any orders, decrees, injunctions or other arrangements with any
governmental entity, nor subject to any indemnity or other agreement with any
third party relating to liability under any Environmental Law or relating to
Hazardous Substances;
(viii) There are no circumstances or conditions involving
Sellers or the Business that could reasonably be expected to result in any
claims, liability, investigations, costs or restrictions on the ownership, use
or transfer of the Real Property pursuant to any Environmental Law; and
(ix) The Real Property has not and does not contain any
underground storage tanks, asbestos-containing material, lead-based products,
halogenated solvents or polychlorinated biphenyls.
(b) "Environmental Law" means any federal, state, local or
foreign law, statute, ordinance, rule, regulation, or treaty; all judicial
administrative, and regulatory orders, judgments, decrees, permits, and
authorizations; and common law relating to: (i) the protection of human health,
the environment or natural resources, (ii) the investigation, remediation or
restoration of the environment or natural resources, (iii) the handling, use,
storage, treatment, disposal, release or threatened release of any Hazardous
Substance; or (iv) noise, odor, pollution, contamination, land use, or any
injury or threat of injury to persons or property related thereto.
(c) "Hazardous Substance" means any substance, material or
waste that is: (i) listed, classified or regulated in any concentration
pursuant to any Environmental Law; (ii) any petroleum product or by-product,
asbestos-containing material, lead-containing paint or plumbing, polychlorinated
biphenyls, radioactive materials; or (iii) any other substance, material or
waste which may be the subject of regulatory action by any governmental entity
pursuant to any Environmental Law.
3.22 RELATIONSHIPS WITH CUSTOMERS AND SUPPLIERS. Except for Lucent
Technologies, no present customer or supplier to the Business has indicated an
intention to terminate or adversely alter its existing business relationship
therewith, and Sellers have no reason to believe that any of the present
customers of or suppliers to the Business intends to do so.
3.23 WARRANTIES; PRODUCT RETURNS. Except as described in SCHEDULE 3.23
hereto, Broadview does not offer any warranties for its products and services.
Broadview's warranty reserve reflected in the allowance for doubtful accounts in
the Financial Statements is and will be adequate to cover all warranty claims
pending as of the date hereof and pending as of the Closing Date. None of the
products manufactured by the Business have been subject to recall.
3.24 INSURANCE. Broadview maintains insurance with reputable insurance
companies on such of its equipment, tools, machinery, inventory and properties
as are usually insured by companies similarly situated in the same geographic
location and to the extent customarily insured, and maintains products and
personal liability insurance, and such other insurance against hazards, risks
and liability to persons and property as is customary for companies similarly
situated in the same geographic location. SCHEDULE 3.24 sets forth a true and
correct list and a
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general description of all insurance policies of any nature whatsoever
maintained by Sellers pertaining to the Business and the Transferred Assets,
including all policies of life, group medical and/or dental insurance. Such
policies will be in full force and effect through the Closing Date and such
policies, or other policies covering the same risks, have been in full force and
effect, without gaps, continuously for the past five (5) years. Copies of all
such policies have been provided to Buyer. Sellers are not in default under any
of such policies or binders and have not failed to give any notice or to present
any material claim under any such policy or binder in a due and timely fashion.
3.25 BANK ACCOUNTS. All bank and savings accounts, and other accounts at
similar financial institutions, of Broadview or relating to the Business are
listed in SCHEDULE 3.25 hereto.
3.26 BROKER'S COMMISSION OR FINDER'S FEES. Except for Illinois Industries,
Inc., no person or entity has acted for Sellers in connection with the
transactions provided for in this Agreement in a way which would entitle such
person to, and no person or entity is entitled to, any broker's commissions or
finder's fees (or other similar fees or commissions) in connection with this
Agreement. Sellers shall be solely responsible for payment of all such
commissions and fees.
3.27 THIRD PARTY BENEFITS. Neither Hetzel or Cervenka, nor any other
related third party, has provided, directly or indirectly, any benefit, service,
good or product to the Business other than as has been fully and fairly
allocated to Broadview and expensed by Broadview at fair value in the cost of
sales or selling, general and administrative sections of Broadview's income
statements.
3.28 FULL DISCLOSURE; KNOWLEDGE. All instruments, agreements and other
documents delivered or to be delivered, or made available, to Buyer pursuant to
this Agreement are complete and correct in all material respects. No
representation or warranty made by Sellers in this ARTICLE III or the Schedules
to this Agreement contains or will contain any untrue statement of a material
fact or omits or will omit to state a material fact required to be stated herein
or therein necessary to make the statements on behalf of Sellers in this
ARTICLE III and the Schedules to this Agreement, in light of the circumstances
in which they are made, not misleading. As used in this Agreement, "Knowledge"
means, with respect to an entity, such knowledge as would be obtained after due
inquiry by the officers of that entity and, with respect to an individual, such
knowledge as would be obtained by that individual after due inquiry.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Sellers as follows:
4.1 ORGANIZATION. Buyer is a corporation duly organized, validly existing
and in good standing in the State of Delaware, and, promptly following the
Closing, will be duly qualified to conduct business in the State of Illinois.
Buyer has the requisite corporate power to own, use or lease its properties and
to carry on its business as now being conducted and as currently proposed to be
conducted.
4.2 AUTHORITY RELATIVE TO THIS AGREEMENT. Buyer has all requisite
corporate power and authority to execute and deliver this Agreement and any
related agreements and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement, any related agreements and the
consummation of the transactions contemplated hereby on the part of Buyer has
been duly and validly authorized by Buyer and no other corporate proceedings on
the part of Buyer are necessary, as a matter of law or otherwise, to authorize
this Agreement or to
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consummate the transactions so contemplated. This Agreement has been duly and
validly executed and delivered by Buyer and, assuming this Agreement constitutes
a valid and binding obligation of Sellers, this Agreement constitutes a valid
and binding agreement of Buyer, enforceable against Buyer in accordance with its
terms, except as such enforcement may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws of general application
affecting enforcement of creditors' rights or by general principles of equity.
4.3 BROKER'S COMMISSION OR FINDER'S FEES. No person or entity has acted
for Buyer in connection with the transactions provided for in this Agreement in
a way which would entitle such person to, and no person or entity is entitled
to, any broker's commissions or finder's fees (or other similar fees or
commissions) in connection with this Agreement or the transactions contemplated
hereby. Buyer shall be solely responsible for payment of all such commissions
and fees.
ARTICLE V
COVENANTS OF SELLERS
During the period from the date of this Agreement until the Closing Date or
the earlier termination of this Agreement, Sellers each agree (except as
expressly contemplated by this Agreement or to the extent that Buyer shall
otherwise consent in writing) as follows:
5.1 ACCESS TO INFORMATION.
(a) Sellers shall (i) give Buyer and its authorized representatives
reasonable access upon reasonable notice during normal business hours in such a
manner as not unduly to disrupt normal business activities to the Transferred
Assets and to all plants, offices, warehouses and other facilities of the
Business and to all contracts, internal reports, data processing files and
records, federal, state, local and foreign tax returns and records, commitments,
books, records and affairs of Sellers related to the Business, whether located
on the premises of the Business or at another location, (ii) permit Buyer to
make such inspections and inquiries as it may require, and (iii) cause
Broadview's officers to furnish Buyer such financial, operating, technical and
product data and other information with respect to the Business and Transferred
Assets as Buyer from time to time may reasonably request, including without
limitation financial statements and schedules; provided, however, that no
investigation pursuant to this SECTION 5.1 shall affect or be deemed to modify
any representation or warranty made by Sellers.
(b) Sellers shall give prompt notice to Buyer of any breach of any of
their covenants hereunder or the occurrence of any event that is reasonably
likely to cause any of their representations and warranties hereunder to become
incomplete or untrue in any respect.
5.2 ORDINARY COURSE. Broadview shall (a) carry on its business in the
usual, regular and ordinary course, in substantially the same manner as
heretofore conducted and use all reasonable efforts consistent with past
practice and policies to preserve its present business organizations, keep
available the services of its present officers and key employees (other than
employees terminated for cause) and preserve its relationships with customers,
suppliers, lessors, lessees and others having business dealings with it, (b)
maintain its books and records in accordance with existing practices, (c) not
pay distributions of any type, (d) not hire additional employees nor become
obligated for additional rental payments, (e) not modify the compensation or
benefits paid to any employee, and (f) not undertake material expenditures,
including, without limitation, the purchase or lease of equipment; provided
that, expenditures less than $10,000 individually and $25,000 in the aggregate
shall not be deemed material.
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5.3 EXCLUSIVE NEGOTIATIONS.
(a) Sellers shall not, directly or indirectly through any employee, agent
or representative (including without limitation investment bankers, attorneys,
accountants and consultants), or otherwise:
(i) solicit, initiate, discuss or further the submission of
proposals or offers from, or enter into any agreement with, any firm,
corporation, partnership, association, group (as defined in Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended) or other person or entity,
individually or collectively (including without limitation any managers,
employees or independent contractors of Sellers or any of their affiliates),
other than Buyer (a "Third Party"), relating to any acquisition or purchase of
all or a material portion of the Transferred Assets, or any equity interest in
Broadview (or the Business), or any merger, consolidation or business
combination with Broadview;
(ii) participate in any discussions or negotiations regarding, or
furnish to any Third Party any confidential information with respect thereto; or
(iii) otherwise cooperate in any way with, or assist or participate
in, facilitate or encourage, any effort or attempt by any Third Party to do or
seek to do any of the foregoing.
(b) Sellers shall promptly notify Buyer in writing if any such proposal or
offer, or any inquiry or contact with any Third Party with respect thereto, is
made, and shall in any such notice, set forth in reasonable detail the identity
of the Third Party, the terms and conditions of any proposal and any other
information requested of it by the Third Party or in connection therewith.
(c) Sellers shall immediately cease and cause to be terminated any
existing activities, discussions or negotiations with any Third Party conducted
prior to the date of this Agreement with respect to any of the foregoing.
(d) The terms set forth in this SECTION 5.3 shall remain in effect from
the date of this Agreement until such time, if ever, as terminated in writing by
Sellers by delivery to Buyer of a termination notice referencing this Section;
provided that, no such termination shall be effective prior to the earlier of
(i) the termination of this Agreement by Buyer, or (ii) ninety (90) days after
the Effective Date.
5.4 NO DISPOSITIONS. Except for the sale of inventory in the ordinary
course of business and other than as may be required by existing contracts,
Sellers shall not sell, lease or otherwise dispose of any Transferred Assets and
shall promptly notify Buyer in writing of any dispositions of non-inventory
items.
5.5 INDEBTEDNESS. Broadview shall not incur, become subject to, or agree
to incur or become subject to any obligation or liability (absolute or
contingent), except current liabilities incurred, and obligations under existing
contracts, in the ordinary course of business consistent with prior practice.
The Joint Venture, Hetzel and Cervenka shall not permit any liens or security
interests to attach to the Real Property.
5.6 BENEFIT PLANS. Broadview shall not:
(a) pay, agree to pay or make any accrual or arrangement for payment of
any pension, retirement allowance or other employee benefit pursuant to any
existing plan, agreement or arrangement to any employee except in the ordinary
course of business and consistent with past practice or as permitted by this
Agreement;
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(b) commit itself to adopt or pay, grant, issue or accrue salary or
benefits pursuant to any additional pension, profit-sharing, bonus, extra
compensation, incentive, deferred compensation, group insurance, severance pay,
retirement or other employee benefit plan, agreement or arrangement, or any
employment or consulting agreement with or for the benefit of any employee,
agent or consultant, whether past or present; or
(c) amend any such existing plan, agreement or arrangement.
5.7 MAINTENANCE OF WORKING CAPITAL. Consistent in all respects with past
practices, Broadview shall (a) timely pay when due all accounts payable and
other expenses, and (b) collect all accounts receivable and convert or use all
other non-cash assets in the ordinary course.
5.8 CASH MANAGEMENT. Sellers agree that all cash, whether in currency,
check or wire form, and all other property received by Sellers on or after the
Closing Date and related in any manner to the Business or the Transferred Assets
shall be for the account of Buyer, and Sellers shall promptly deliver all such
cash to Buyer with a written accounting thereof. If requested, Broadview shall
provide assistance to Buyer in identifying and notifying certain customers of
changes in bank accounts for the Business.
5.9 CHANGE OF NAME. Broadview shall take all necessary actions and make
all necessary filings to modify its name to exclude any and all references to
"Broadview" effective as of the Closing Date. In addition, Sellers shall cease
use of any items referencing "Broadview" in any manner as of the Closing,
including without limitation, stationary and brochures.
5.10 TAX AND REAL ESTATE MATTERS. All Tax Returns which relate to any
Taxes with respect to the Business or the Transferred Assets for periods prior
to the Closing Date shall be prepared and filed by Sellers on a timely basis,
and Sellers shall be responsible for the payment of all Taxes related to the
Business or the Transferred Assets attributable to periods prior to the Closing,
except for real property taxes as set forth in SECTION 1.4(c). Sellers shall
pay all sales, use and transfer taxes, if any, payable to the State of Illinois,
any subdivision thereof or to any other governmental entity in connection with
the transactions contemplated by this Agreement and the Closing; including any
real estate stamp tax or other real estate tax imposed on the transfer of title.
If requested by Buyer, Sellers shall furnish a completed real estate transfer
declaration signed by the appropriate Sellers in the form required by the Real
Estate Transfer Tax Act of the State of Illinois and shall furnish any other
required documents. Sellers shall pay any costs and expenses incurred in
connection with Sellers obtaining title policies (containing such endorsements
as are reasonably required by Buyer), conducting searches and surveys (if
required for issuance of title policies), obtaining a current ALTA plat of
survey in a form reasonably satisfactory to Buyer, and all related issues on
each item of real estate in the Transferred Assets other than environmental
assessments.
5.11 INSURANCE. Sellers shall take all necessary actions to maintain in
force all of their existing insurance policies (or replacements therefor),
subject only to variations in amounts required by the ordinary operation of the
Business.
ARTICLE VI
MUTUAL COVENANTS
6.1 CONFIDENTIALITY. Between the date hereof and the Closing Date, the
parties hereto agree that no party shall, without the prior written consent of
the others as to substance, existence and timing, disclose publicly or to any
third party (except such party's professional advisors) the existence of this
Agreement or the terms and conditions hereof, or any prior correspondence or any
subsequent negotiations between the parties, including any confidential
information obtained
16
thereby, except to the extent required by law. The parties will cooperate with
each other to coordinate any and all public statements and releases with respect
to the transactions contemplated hereby. From the date hereof until the Closing,
neither Sellers nor any of their representatives shall purchase, directly or
indirectly, in the public marketplace or otherwise, any securities of Summa
Industries, a Delaware corporation ("Summa"). Following the Closing, Sellers
shall keep confidential and shall not disclose to any third party all
information not then in the public domain relating in any manner to the Business
or the Transferred Assets.
6.2 SATISFACTION OF CONDITIONS. Each party will use all reasonable
efforts to cause all conditions to its obligations under this Agreement to be
timely satisfied and to perform and fulfill all covenants and obligations on its
part to be performed and fulfilled under this Agreement, to the end that the
transactions contemplated by this Agreement shall be effected substantially in
accordance with its terms as soon as reasonably practicable. The parties shall
cooperate with each other in such actions and in securing requisite approvals.
6.3 FURTHER ASSURANCES. Each party shall execute and deliver, both before
and after the Closing, such further certificates, agreements and other documents
and take such other actions as may be necessary or appropriate to consummate or
implement the transactions contemplated hereby, including without limitation the
transfer of all Transferred Assets to Buyer, or to evidence such events or
matters.
6.4 BULK SALES COMPLIANCE. The parties agree to waive compliance with all
applicable bulk transfer laws. Sellers shall indemnify, defend and hold
harmless Buyer from and against any and all Losses (as defined in
SECTION 9.1(C)) arising or resulting from, or connected with, this waiver or the
failure or alleged failure of any party hereto to comply, in connection with the
transactions contemplated hereby, with the bulk transfer laws and requirements
of any jurisdiction. Nothing in this SECTION 6.4 shall operate or be construed
to estop or prevent any party hereto from asserting as a bar or defense to any
action or proceeding brought under any bulk sales law that such law does not
apply to the transfer contemplated under this Agreement. If required, Sellers
shall deliver to Buyer any bulk sale stop orders, shall escrow any funds
required thereby, and shall pay such escrowed amounts to the appropriate
governmental entity.
6.5 CERTAIN DEFAULTS. Sellers, on the one hand, and Buyer, on the other
hand, will give prompt notice to each other of:
(a) any notice of default received by such party subsequent to the date of
this Agreement and prior to the Closing Date under any material instrument or
material agreement to which any such party is a party or by which it is bound,
which default in the case of any Seller would, if not remedied, result in a
Material Adverse Change or which, in the case of any such party, would render
incomplete or untrue any representation made herein; and
(b) any suit, action or proceeding instituted or threatened against or
affecting any such party subsequent to the date of this Agreement and prior to
the Closing Date which would render incorrect any representation made herein.
6.6 BROKERS OR FINDERS. Neither Sellers nor Buyer shall enter into any
agreement or arrangement not existing as of the date hereof with any agent,
broker, investment banker or other firm or person pursuant to which such person
shall be entitled to any broker or finder's fee or any other commission or
similar fee in connection with any of the transactions contemplated by this
Agreement.
6.7 NO EQUITABLE CONVERSION. Prior to the Closing Date, neither the
execution of this Agreement nor the performance of any provision contained
herein shall cause either Sellers, on the one hand, or Buyer, on the other hand,
to be or become liable for or in respect of the
17
operations or business of the other, for the cost of any labor or materials
furnished to or purchased by the other, for compliance with any laws,
requirements or regulations of, or taxes, assessments or other charges now or
hereafter due to, any governmental authority, or for any other charges or
expenses whatsoever pertaining to the conduct of the business or the ownership,
title, possession, use or occupancy of the property of the other.
6.8 CERTAIN EMPLOYEE ISSUES. On the Closing Date, Buyer shall offer at
will employment to all employees of Broadview as of the Closing (the "Affected
Employees") on such terms and conditions as Buyer shall determine; provided
that, in the aggregate, such terms and conditions shall be comparable to those
now in effect with respect to the employment of such employees by Broadview.
Nothing in this Section shall be deemed to require the employment of any
Affected Employee or the continuation of any benefits for any particular time
after the Closing Date.
ARTICLE VII
CONDITIONS PRECEDENT TO OBLIGATIONS OF THE PARTIES
7.1 CONDITIONS TO THE OBLIGATIONS OF BUYER AND SELLERS. The respective
obligations of Buyer and Sellers set forth in this Agreement shall be subject to
the satisfaction on or prior to the Closing Date of the following conditions,
unless waived by each such party in writing:
(a) LEGAL ACTION. No temporary restraining order, preliminary injunction
or permanent injunction or other order preventing the consummation of the
transactions contemplated by this Agreement shall have been issued by any
federal, state or foreign court or other governmental or regulatory authority
and remain in effect, and no litigation seeking the issuance of such an order or
injunction, or seeking substantial damages against Buyer or Sellers if the
transactions contemplated by this Agreement are consummated, shall be pending
which, in the reasonable good faith judgment of the party against whom such
damages or injunction is sought, have a reasonable probability of resulting in
such order, injunction or substantial damages. In the event any such order or
injunction shall have been issued, each party agrees to use its reasonable
efforts to have any such injunction lifted.
(b) STATUTES. No federal, state, local or foreign statute, rule or
regulation shall have been enacted which would make the consummation of the
transactions contemplated by this Agreement illegal.
7.2 FURTHER CONDITIONS TO THE OBLIGATIONS OF BUYER. The obligations of
Buyer set forth in this Agreement are subject to the satisfaction on or prior to
the Closing Date of the following conditions, unless waived by Buyer in writing:
(a) REPRESENTATIONS AND WARRANTIES. The representations and warranties of
Sellers set forth in ARTICLE III shall be true and correct as of the date of
this Agreement and as of the Closing Date, except as otherwise contemplated by
this Agreement, and Buyer shall have received a certificate dated the Closing
Date signed by an authorized officer of Broadview and by the Joint Venture,
Hetzel and Cervenka to such effect ("Sellers' Certificate").
(b) PERFORMANCE OF OBLIGATIONS OF OTHER PARTIES. Sellers shall have
satisfied all of the conditions set forth in this SECTION 7.2 and performed all
obligations required to be performed by them under this Agreement prior to the
Closing Date, and Buyer shall have received a certificate signed by Sellers to
such effect.
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(c) OPINION OF COUNSEL TO SELLERS. Buyer shall have received an opinion
dated as of the Closing Date of counsel to Sellers containing the opinions set
forth in EXHIBIT D attached hereto.
(d) NO LITIGATION. Since the date hereof, there shall not have been
instituted and be continuing or threatened against Sellers any claims, actions
or proceedings relating in any manner to the Business or the Transferred Assets
which, if adversely determined, could, individually or in the aggregate, result
in a Material Adverse Change.
(e) NO ADVERSE CHANGE. No Material Adverse Change shall have occurred
since the date of this Agreement.
(f) THIRD-PARTY APPROVALS. Any and all material consents required from
third parties relating to licenses, leases and other agreements and instruments
that are part of the Transferred Assets shall have been obtained.
(g) NONCOMPETITION AND NONSOLICITATION AGREEMENT. Hetzel and Cervenka
shall have entered into noncompetition and nonsolicitation agreements with Buyer
substantially in the form attached hereto as EXHIBIT E.
(h) DEBT; GUARANTEES. There shall be no agreements or instruments
evidencing loans to or interest bearing indebtedness incurred by Broadview or
incurred by the Joint Venture, Hetzel or Cervenka and related in any manner to
the Business or Transferred Assets, and Sellers, on or prior to the Closing,
shall have paid in full all applicable interest bearing indebtedness and loans
of any type, including current portions thereof. All guarantees by Broadview of
any type of obligation shall have been terminated.
(i) TERMINATION OF ENCUMBRANCES. All liens and encumbrances on the
Transferred Assets shall have been terminated, and Sellers shall have received
and delivered to Buyer duly executed UCC termination statements with respect to
any and all UCC financing statements covering such assets and property,
including, without limitation, the following financing statements: 3743199,
3639392, 3894455, 3894402, 3894456, 3540086, 3631562, 3640530, 3648085, and
3886302.
(j) DUE DILIGENCE. Buyer shall have completed its due diligence
investigations to its sole and absolute satisfaction.
(k) RECEIPT OF TRANSFER DOCUMENTS. Buyer shall have received the executed
General Instrument of Conveyance, Transfer and Assignment in the form attached
hereto as EXHIBIT A and all other documents required by Buyer to transfer title
of the Transferred Assets to Buyer, including all real estate transfer
documents.
7.3 FURTHER CONDITIONS TO THE OBLIGATIONS OF SELLERS. The obligations of
Sellers set forth in this Agreement are subject to the satisfaction on or prior
to the Closing Date of the following conditions, unless waived by Sellers in
writing:
(a) REPRESENTATIONS AND WARRANTIES. The representations and warranties of
Buyer set forth in ARTICLE IV shall be true and correct in all material respects
as of the date of this Agreement and as of the Closing Date, and Sellers shall
have received a certificate dated the Closing Date signed by an authorized
officer of Buyer to such effect ("Buyer's Certificate").
(b) PERFORMANCE OF OBLIGATIONS OF OTHER PARTIES. Buyer shall have
satisfied all of the conditions set forth in this SECTION 7.3 and performed in
all material respects all obligations
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required to be performed by it under this Agreement prior to or on the Closing
Date, and Sellers shall have received a certificate signed by an authorized
officer of Buyer to such effect.
(c) RECEIPT OF ASSUMPTION AGREEMENT. Sellers shall have received the
executed Assumption Agreement in the form attached hereto as EXHIBIT C.
(d) RECEIPT OF CONSIDERATION. Sellers shall have received the portion of
the Purchase Price as set forth in SECTION 2.1(A).
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
8.1 TERMINATION. This Agreement may be terminated at any time prior to
the Closing Date:
(a) BY MUTUAL CONSENT. By the mutual written consent of Buyer and
Sellers;
(b) BY BUYER OR SELLERS. By either Buyer or Sellers:
(i) if the transactions contemplated by this Agreement shall not
have been consummated on or before September 30, 1999; provided that the failure
of the transactions to be consummated by such date is not caused by any breach
of this Agreement by the party seeking such termination;
(ii) if a court of competent jurisdiction or other governmental or
regulatory authority shall have issued an order, decree or ruling or taken any
other action, in each case permanently restraining, enjoining or otherwise
prohibiting the consummation of the transactions contemplated by this Agreement;
or
(iii) if any statute, rule or regulation is enacted, promulgated or
deemed applicable to the transactions contemplated by this Agreement by any
competent governmental or regulatory authority which makes the consummation of
the transactions illegal.
(c) BY BUYER. By Buyer, if a material default under or a material breach
of this Agreement by Sellers shall have occurred and be continuing ten (10) days
after receipt of written notice thereof from Buyer, or if a condition set forth
in SECTION 7.2 has not been satisfied and will not be satisfied by the date set
forth in SECTION 8.1(b)(i) above.
(d) BY SELLERS. By Sellers, if a material default under or a material
breach of this Agreement by Buyer shall have occurred and be continuing ten (10)
days after receipt of written notice thereof from Sellers.
Any action taken to terminate this Agreement pursuant to this SECTION 8.1
shall become effective when written notice of such termination is delivered by
the terminating party to the other party in accordance with the provisions of
SECTION 10.1 below.
8.2 EFFECT OF TERMINATION. In the event of termination of this Agreement
by either Buyer or Sellers in accordance with SECTION 8.1 above, this Agreement
shall forthwith become void and there shall be no liability or obligation on the
part of the terminating party or its respective officers, directors or
employees, except that (a) SECTION 6.1 relating to the obligations to keep
confidential certain information and data, (b) SECTION 10.3 relating to certain
expenses, (c) SECTION 10.8 relating to attorneys' fees and expenses, (d)
SECTIONS 3.26 and 4.3 relating to
20
finder's fees and broker's fees, (e) SECTION 10.9 relating to jurisdiction and
forum selection, and (g) this ARTICLE VIII shall survive any termination and
that nothing set forth herein shall relieve a party hereto from liability for
its willful breach of this Agreement. Without limitation, if all of the
conditions to a party's obligations set forth in ARTICLE VII have been satisfied
or waived by September 30, 1999, the failure of such party to perform its
obligations on or before such date shall be deemed to be a willful breach of
this Agreement by such party.
8.3 AMENDMENT. This Agreement may not be amended except by an instrument
in writing signed on behalf of each of the parties hereto.
8.4 EXTENSION; WAIVER. At any time prior to or on the Closing Date, to
the extent legally allowed, any party hereto (a) may extend the time for the
performance of any of the obligations owed to such party by the other parties
hereto, (b) may waive any inaccuracies in the representations and warranties
made to such party contained herein or in any document delivered pursuant
hereto, or (c) may waive compliance with any of the agreements or conditions for
the benefit of such party contained herein. Any agreement on the part of a
party hereto to any such extension or waiver shall be valid if set forth in an
instrument in writing signed on behalf of such party and shall be effective only
to the extent set forth in such instrument. No extension or waiver of any
single condition, covenant, agreement, representation, warranty, breach, default
or other matter hereunder shall be deemed an extension or waiver of such or any
other condition, covenant, agreement, representation, warranty, breach, default
or other matter theretofore or thereafter occurring. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law. The failure of any
party to insist upon a strict performance of any of the terms or provisions of
this Agreement, or to exercise any option, right or remedy herein contained,
shall not be construed as a waiver or as a relinquishment for the future of such
term, provision, option, right or remedy, but the same shall continue and remain
in full force and effect.
ARTICLE IX
INDEMNIFICATION
9.1 INDEMNIFICATION.
(a) INDEMNIFICATION BY SELLERS. Sellers jointly and severally agree to
indemnify and hold harmless Buyer, its affiliates (including without limitation
parent and sister corporations), and their respective directors, officers,
employees, agents and assigns from and against any and all "Losses" (as defined
below) incurred by, imposed on, borne by or asserted against any of such
indemnified parties in any way relating to, arising out of or resulting from
(i) any inaccuracy in or breach or nonperformance of any of the representations,
warranties, covenants or agreements made by Sellers in or pursuant to this
Agreement or in any agreement delivered in connection herewith or pursuant
hereto (each, a "Related Agreement"), (ii) the conduct of the business of
Broadview prior to the Closing Date (including, without limitation, all
liability for pre-closing tax periods, including amounts not paid or provided
for through estimated taxes or deposits for the partial period ending at the
close of business on the day preceding the Closing Date), (iii) any claims or
demands by any governmental authority or third party arising under any
Environmental Law to the extent attributable to Broadview's use and/or occupancy
of any premises owned or used by Broadview at any time prior to the Closing
Date, or to Hazardous Substances transported by or on behalf of Broadview prior
to the Closing Date, and/or (iv) the failure by Sellers to discharge or perform
the Retained Obligations.
(b) INDEMNIFICATION BY BUYER. Buyer shall indemnify and hold harmless
Sellers and their respective affiliates (including without limitation, their
directors, officers, employees, agents
21
and assigns from and against any and all "Losses" (as defined below) incurred
by, imposed on, borne by or asserted against any of such indemnified parties in
any way relating to, arising out of or resulting from any inaccuracy in or
breach or nonperformance of any of the representations, warranties, covenants or
agreements made by Buyer in or pursuant to this Agreement or in any Related
Agreement.
(c) DEFINITION OF LOSSES. For purposes of this Agreement, "Losses" shall
mean any and all liabilities, obligations, losses, damages, claims,
deficiencies, penalties, taxes, levies, actions, judgments, settlements, suits,
costs, legal fees, accountants' fees, experts' fees, disbursements and expenses.
9.2 THIRD PARTY CLAIMS, NOTICE AND OPPORTUNITY TO SETTLE.
(a) Within thirty (30) days after the receipt by the party entitled to
indemnity hereunder (the "Indemnified Party") of any claim or demand (including
but not limited to, notice of any action, suit or proceeding) by any third party
against an Indemnified Party which gives rise to a right to indemnification for
a Loss hereunder (a "Third Party Claim"), the affected Indemnified Party shall
give each party who may be obligated to provide indemnity hereunder (the
"Indemnifying Party") written notice of such claim or demand; provided, however,
that the failure to give such notice shall not relieve the Indemnifying Party of
its obligations hereunder.
(b) The Indemnifying Party shall (without prejudice to the right of any
Indemnified Party to participate at its own expense through counsel of its own
choosing) defend against such claim or demand at its sole expense and through
counsel of its own choosing (the choice of such counsel to be subject to the
consent of the affected Indemnified Parties) and shall give written notice
confirming its assumption of the defense within five (5) days of the receipt of
the notice referred to in Section 9.2(a) above. If the Indemnifying Party fails
to assume the defense of such claim or demand, the affected Indemnified Parties
shall have the right to assume control of such defense at the sole expense of
the Indemnifying Party. The Indemnified Parties shall cooperate in the defense
of such claim or demand, at the Indemnifying Party's expense, and shall make
available to the Indemnifying Party or its counsel pertinent information under
their control relating thereto. The Indemnifying Party agrees to cooperate with
the Indemnified Parties in order to enable their counsel to participate in the
defense and to deliver to the Indemnified Parties copies of all pleadings and
other information within the Indemnifying Party's knowledge or possession
reasonably requested by the Indemnified Parties that is relevant to the defense
of any such claim or demand.
(c) The Indemnifying Party shall have the right to elect to settle all
such claims or demands, for monetary damages only and including an unconditional
release, subject to the consent of the affected Indemnified Parties.
9.3 NON-THIRD PARTY CLAIMS. In the event any Indemnified Party should
have a claim against any Indemnifying Party hereunder which does not involve a
Third Party Claim, the Indemnified Party shall transmit to the Indemnifying
Party a written notice (the "Indemnity Notice") describing in reasonable detail
the nature of the claim, an estimate of the amount of damages attributable to
such claim, and the basis of the Indemnified Party's request for indemnification
under this Agreement. If the Indemnifying Party does not notify the Indemnified
Party within ten (10) days from the Indemnifying Party's receipt of the
Indemnity Notice that the Indemnifying Party disputes such claim and the reasons
therefor, the claim specified by the Indemnified Party in the Indemnity Notice
shall be deemed admitted in full and a liability of the Indemnifying Party
hereunder.
9.4 PAYMENTS. Payments of all amounts owed by an Indemnifying Party
pursuant to this ARTICLE IX relating to a Third Party Claim shall be made within
five (5) days after the latest of
22
(i) the settlement of such Third Party Claim, (ii) the final adjudication of
such Third Party Claim or (iii) the final adjudication of the Indemnifying
Party's liability to the Indemnified Party under this Agreement. Payments of all
amounts owed by an Indemnifying Party pursuant to SECTION 9.3 shall be made
within five (5) days after the later of (i) the expiration of the 10-day
Indemnity Notice period or (ii) the agreement or final adjudication of the
Indemnifying Party's liability to the Indemnified Party under this Agreement.
9.5 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The representations,
warranties and covenants of each of the parties to this Agreement shall survive
the execution of this Agreement and the consummation of the purchase and sale
herein described.
9.6 ADJUSTMENT TO PURCHASE PRICE. Any indemnification received under this
ARTICLE IX shall be, to the extent permitted by law, an adjustment to the
Purchase Price.
ARTICLE X
GENERAL PROVISIONS
10.1 NOTICES. All notices and other communications hereunder shall be in
writing and shall be deemed given upon personal delivery, facsimile transmission
(with written or facsimile confirmation of receipt), or on the first day
following delivery by a reputable overnight commercial delivery service
(delivery, postage or freight charges prepaid), or on the third day following
deposit in the United States mail (if sent by registered or certified mail,
return receipt requested, delivery, postage or freight charges prepaid),
addressed to the parties at the following addresses (or at such other address
for a party as shall be specified by like notice):
If to Buyer: With copy to:
Broadview Injection Molding, Inc. Summa Industries
c/o Summa Industries One Park Plaza, Sixth Floor
21250 Hawthorne Blvd., Suite 500 Irvine, CA 92614
Torrance, CA 90503 Fax: (949) 852-7316
Fax: (310) 792-7024 Attn: Trygve M. Thoresen
Attn: James R. Swartwout
If to Sellers: With copy to:
Mr. Michael Hetzel Mark Becker, Esq.
c/o Broadview Injection Molding Co., Inc. 1105 W. Burlington Ave.
2748 S. 21st Street Western Springs, IL. 60558
Broadview, IL 60153
10.2 INTERPRETATION. When a reference is made in this Agreement to an
Article, Section, Exhibit or Schedule, such reference shall be to an Article,
Section, Exhibit or Schedule to this Agreement unless otherwise indicated. The
words "include," "includes" and "including" when used herein shall be deemed in
each case to be followed by the words "without limitation." The table of
contents and headings contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement.
10.3 EXPENSES. Whether or not the transactions contemplated hereby are
consummated, and except as otherwise provided in this Agreement, all fees, costs
and expenses
23
incurred in connection with this Agreement and the transactions contemplated
hereby shall be paid by the party incurring such fees, costs or expenses.
10.4 INTEGRATION. This Agreement and the Exhibits, Schedules, documents,
instruments and other agreements among the parties hereto that are referred to
herein constitute the entire agreement among the parties with respect to the
subject matter set forth herein or therein and supersede all prior agreements
and understandings, both written and oral, among the parties with respect to the
subject matter hereof or thereof, including, without limitation, any term sheets
or letters of intent.
10.5 ASSIGNMENT. No party hereto shall assign or transfer or permit the
assignment or transfer of this Agreement without the prior written consent of
the other parties; provided, however, that Buyer may assign any of its rights
and obligations hereunder to any entity that, directly or indirectly, through
one or more intermediaries, controls, or is controlled by, or is under common
control with Buyer. No such assignment by Buyer will relieve Buyer of any of
its obligations or duties under this Agreement.
10.6 SEVERABILITY. Any portion or provision of the Agreement which is
invalid, illegal or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability, without affecting in any way the remaining portions or
provisions hereof in such jurisdiction or, to the extent permitted by law,
rendering that or any other portion or provision of the Agreement invalid,
illegal or unenforceable in any other jurisdiction.
10.7 GOVERNING LAW. This Agreement and the rights and obligations of the
parties hereunder shall be governed in all respects, including validity,
interpretation and effect, by the laws of the State of Delaware, without regard
to its rules of conflicts of law.
10.8 ATTORNEYS' FEES. If any party to this Agreement shall bring any
action, suit, counterclaim or appeal for any relief against any other party,
declaratory or otherwise, to enforce the terms hereof or to declare rights
hereunder (collectively, an "Action"), the prevailing party shall be entitled to
recover as part of any such Action its reasonable attorneys' fees and costs,
including any fees and costs incurred in bringing and prosecuting such Action
and/or enforcing any order, judgment, ruling or award granted as part of such
Action. "Prevailing party" within the meaning of this section includes, without
limitation, a party who agrees to dismiss an Action upon the other party's
payment of all or a portion of the sums allegedly due or performance of the
covenants allegedly breached, or who obtains substantially the relief sought by
it.
10.9 CONSENT TO JURISDICTION: FORUM SELECTION. The parties agree that all
actions or proceedings arising in connection with this Agreement shall be tried
and litigated exclusively in the courts located in the County of Cook, State of
Illinois. The aforementioned choice of venue is intended by the parties to be
mandatory and not permissive in nature, thereby precluding the possibility of
litigation between the parties with respect to or arising out of this Agreement
in any jurisdiction other than those specified in this section. Each party
hereby waives any right it may have to assert the doctrine of forum non
conveniens or similar doctrine or to object to venue with respect to any
proceeding brought in accordance with this section, and stipulates that the
courts located in the County of Cook, State of Illinois shall have in personam
jurisdiction and venue over each of them for the purpose of litigating any
dispute, controversy or proceeding arising out of or related to this Agreement.
Each party hereby authorizes and accepts service of process sufficient for
personal jurisdiction in any action against it as contemplated by this section
by registered or certified mail, return receipt requested, postage prepaid, to
its address for the giving of notices as set forth in this Agreement, or in the
manner set forth in SECTION 10.1 of this Agreement for the giving of notice.
Any final judgment rendered against a party in any action or proceeding shall be
24
conclusive as to the subject of such final judgment and may be enforced in other
jurisdictions in any manner provided by law.
10.10 NO THIRD-PARTY BENEFICIARIES. Except as provided in ARTICLE IX
as to Indemnified Parties, this Agreement is for the sole benefit of the parties
hereto and their permitted assigns and nothing herein expressed or implied shall
give or be construed to give to any person or entity, other than the parties
hereto and such assigns, any legal or equitable rights hereunder.
10.11 COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed an original, and all of which taken together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
BUYER: SELLERS:
BROADVIEW INJECTION MOLDING, INC., BROADVIEW INJECTION MOLDING, CO., INC.,
a Delaware corporation an Illinois corporation
By: /s/ Trygve M. Thoresen By: /s/ Michael L. Hetzel
------------------------------- ------------------------------------
Trygve M. Thoresen, Vice President Michael L. Hetzel, President
CERVENKA AND HETZEL JOINT VENTURE IN
ILLINOIS
By: /s/ Marvin E. Hetzel
------------------------------------
Mr. Marvin E. Hetzel, joint venturer
By: /s/ Joseph J. Cervenka, Sr.
------------------------------------
Mr. Joseph J. Cervenka, Sr., joint
venturer
/s/ Marvin E. Hetzel
------------------------------------
Mr. Marvin E. Hetzel, an individual
/s/ Joseph J. Cervenka, Sr.
------------------------------------
Mr. Joseph J. Cervenka, Sr., an
individual
25
SCHEDULES
1.1 Transferred Assets
1.1(h) Assumed Contracts
1.4 Assumed Obligations
2.2 Allocation of Purchase Price
3.5 Consents and Approvals; No Violation
3.6 Financial Statements
3.7 Absence of Certain Changes
3.8 Absence of Undisclosed Liabilities
3.9 Leased and Licensed Transferred Assets
3.10 Real Property
3.11 Intellectual Property
3.13 Inventory
3.14 Contracts
3.15 Employment and Labor Matters
3.16 ERISA Plans
3.18 Taxes
3.19 Litigation
3.21 Environmental Matters
3.23 Warranties; Product Returns
3.24 Insurance
3.25 Bank Accounts
EXHIBITS
A. Form of Note
B. General Instrument of Conveyance, Transfer and Assignment
C. Assumption Agreement
D. Form of Opinion of Counsel to Sellers
E. Form of Noncompetition and Nonsolicitation Agreement
The Schedules and Exhibits to this Agreement have been omitted pursuant to the
rules and regulations of the Securities and Exchange Commission. The Company
agrees to furnish supplementally a copy of any omitted Schedule or Exhibit to
the Commission upon request.
26