Exhibit 10.3
THIS AGREEMENT made effective, this 31st day of March, 1998.
BETWEEN:
ZCL COMPOSITES INC., a body corporate duly
incorporated pursuant to the laws of the Province of Alberta (hereinafter
referred to as the "ZCL")
OF THE FIRST PART
- and -
PULTRONEX CORPORATION, a body corporate duly
incorporated pursuant to the laws of the Province of Alberta (hereinafter
referred to as the "Purchaser")
OF THE SECOND PART
- and -
ROBERT DAY, an individual resident in the Province of
Alberta ("Day")
OF THE THIRD PART
- and -
KULDIP DELHON, an individual resident in the Province
of Alberta ("Delhon")
OF THE FOURTH PART
- and -
KRISHEN MEHRA, an individual resident in the Province
of Alberta ("Mehra")
OF THE FIFTH PART
- and -
JARNAIL SEHRA, an individual resident in the Province
of Alberta ("Sehra")
OF THE SIXTH PART
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ASSET PURCHASE AND SALE AGREEMENT
WHEREAS:
A. The Purchaser is desirous of acquiring from ZCL and ZCL is desirous of
selling to the Purchaser the Assets for the Purchase Price, all on the
terms as set forth herein;
B. As security for payment of the Purchase Price, the Purchaser and the
Principals have agreed to grant security to ZCL, including the General
Security Agreements, the Mortgage and the Guarantee;
NOW THEREFORE THIS AGREEMENT WITNESS THAT, in consideration of the mutual
covenants, promises and provisos hereinafter contained and other good and
valuable consideration, the Parties hereto agree as follows:
ARTICLE 1 - DEFINITIONS
1.1 In this Agreement (including the recitals and each schedule hereto) the
words and phrases set forth below shall have the following meanings ascribed
thereto:
1.1.1"Agreement" means this Agreement in writing between the Parties and
any amendments thereto, including the recitals together with any
schedules attached hereto and made part hereof;
1.1.2"Assets" means all assets owned by ZCL comprising the pultrusion
division of ZCL including, but not limited to, the Premises, the
Equipment, the Raw Materials, the Stock and the Intangibles;
1.1.3"Business" means the business currently carried on by ZCL through its
pultrusion division which consists of the manufacture and sale of
pultruded products throughout North America;
1.1.4"business day" means any day except Saturday, Sunday and statutory
holidays in the Province of Alberta;
1.1.5"Closing" means the conveyance to the Purchaser by ZCL of the Assets
in accordance with the terms of this Agreement;
1.1.6"Closing Date" means June 3, 1998 or such other date as the Parties
mutually agree to;
1.1.7 "Effective Date" means March 31, 1998;
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1.1.8"Equipment" means all equipment, toolings and fixtures owned by ZCL,
as of the Effective Date, located on the Premises, including but not
limited to that equipment listed in Schedule "A" attached hereto and
excluding underground storage tanks, strap assembly and testing
equipment and the hydraulic press for bio-container cores;
1.1.9"General Security Agreement" means the general security agreement to
be granted by the Purchaser to ZCL in the form attached as Schedule
"C";
1.1.10 "GST" means goods and services tax as defined by the Excise Tax Act
(Canada);
1.1.11 "Guarantee" means the guarantee to be provided by each of the
Principals to ZCL in the form attached as Schedule "E";
1.1.12 "Intangibles" means all patents, trademarks, technology, designs,
specifications, know-how, customer lists and market information owned
by ZCL as at the Effective Date and associated with pultrusion;
1.1.13 "Mortgage" means the collateral mortgage to be granted by the
Purchaser to ZCL as security for payment of the Promissory Note in the
form attached hereto as Schedule "D";
1.1.14 "Person" means an individual, a partnership, a corporation, a joint
venture, and any other form of incorporated or unincorporated
association, organization or other entity;
1.1.15 "Premises" means the land and building located at 2305 - 8th Street,
Nisku, Alberta;
1.1.16 "Principals" means collectively Day, Delhon, Mehra and Sehra;
1.1.17 "Promissory Note" means a Promissory Note in the form set out as
Schedule "B" hereto and forming part of this Agreement to be executed
by the Purchaser and dated the Effective Date hereof;
1.1.18 "Purchase Price" means the sum of THREE MILLION ONE DOLLARS
($3,000,001) in Canadian currency;
1.1.19 "Raw Materials" means all unprocessed or partially processed
materials or supplies, as of the Effective Date, located on the
Premises used in the manufacture, packaging or shipment by ZCL of
pultruded products, or the maintenance of the Equipment or the
Premises, excluding any Parabeam fabric and tank related materials
stored on the Premises;
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1.1.20 "Stock" means finished goods and work in process on pultruded
products related to the Business, owned by ZCL as of the Effective
Date, whether located on the Premises or held in other locations,
consigned goods, accessories normally sold with pultruded products,
marketing materials and displays.
ARTICLE 2 - PURCHASE AND SALE OF ASSETS
2.1 On the Closing Date, ZCL hereby sells, transfers and conveys to the
Purchaser, in consideration for the payment of the Purchase Price by the
Purchaser to ZCL all right, title and interest to the Assets as of the Effective
Date, free and clear of any claims, liens, encumbrances, charges or security
interest whatsoever.
2.2 The Purchase Price for the Assets shall be paid as follows:
2.2.1TWO HUNDRED THOUSAND AND ONE DOLLARS ($200,001) by way of a deposit
(the "Deposit") shall be paid upon acceptance of the offer by ZCL to
sell the Assets to the Purchaser (the receipt of which is hereby
acknowledged);
2.2.2The balance by Promissory Note to be TWO MILLION EIGHT HUNDRED
THOUSAND DOLLARS ($2,800,000), payable to ZCL in full on or before
March 31, 1999 in accordance with the terms of such Promissory Note.
2.3 The Parties do hereby acknowledge and agree that the Deposit shall be
non-refundable to the Purchaser in the event that the Purchaser is
unable to complete the purchase of Assets contemplated hereunder.
2.4 The parties agree that, with respect to adjustments to the Purchase Price:
2.4.1all necessary adjustments, including adjustments of all income and
expenses of the Business occurring after the Effective Date shall be
for the account of the Purchaser as well as all customary closing
adjustments respecting the transfer of real property, including
property taxes as at the Effective Date; and
2.4.2all necessary adjustments, including adjustments of all income and
expenses of the Business occurring prior to the Effective Date shall
be for the account of ZCL as well as all customary closing adjustments
respecting the transfer of real property, including property taxes as
at the Effective Date; and
2.4.3interest on the outstanding balance of the Promissory Note shall be
accrued monthly in arrears at the rate of 15% per annum commencing on
April 1, 1998 and become payable on September 30, 1998 and on a
monthly basis thereafter. Provided however, that if principal payments
are made when
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due, the Purchaser will be credited retroactively for
the total accrued amount from April 1, 1998 until September 30, 1998
and credited for accrued interest in excess of 7.5% per annum on a
monthly basis thereafter.
2.5 The parties agree that the Purchase Price for the Assets will be allocated
as follows:
(a) Premises, Equipment, Raw Materials and Stock $3,000,000.00
(b) Intangibles 1.00
-----------------
Total Purchase Price: $3,000,001.00
2.6 ZCL and the Purchaser agree to jointly elect that GST shall not apply to the
purchase of Assets contemplated hereunder and the Parties agree to take all
necessary steps to execute such further and other documentation as may be
required and to give such further assurances as may be necessary in order that
GST not apply to this transaction pursuant to the Excise Tax Act (Canada). In
the event that GST shall apply to the sale of Assets contemplated hereunder, the
payment of GST shall be the responsibility of the Purchaser. Such payment shall
be taken into consideration as an adjustment (in addition) to the Purchase Price
as contemplated in section 0 hereof.
2.7 As security for the Promissory Note, the Purchaser does hereby agree to
grant to ZCL the General Security Agreement and the Mortgage.
2.8 As further security for the Promissory Note, each of the Principals do
hereby agree to provide a Guarantee to ZCL, such Guarantees being in the
aggregate amount of EIGHT HUNDRED THOUSAND DOLLARS ($800,000), being the sum of
TWO HUNDRED THOUSAND DOLLARS ($200,000) from each Principal. It is hereby
acknowledged and agreed amongst the parties hereto that no legal action in
relation to the Guarantees shall be initiated by ZCL until the amount owing, if
any, is determined after ZCL has taken all reasonable steps to realize on its
security other than the Guarantees .
2.9 ZCL does hereby agree to discharge the Mortgage upon receipt by ZCL of the
principal amount of ONE MILLION FIVE HUNDRED AND FIFTY THOUSAND DOLLARS
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($1,550,000), under the terms of the Promissory Note. ZCL further agrees to
discharge its security interest of any kind and nature whatsoever related to the
Equipment, upon the further payment of the principal amount of SEVEN HUNDRED
FIFTY THOUSAND DOLLARS ($750,000) (aggregate TWO MILLION THREE HUNDRED THOUSAND
DOLLARS ($2,300,000)) of the principal amount of the Promissory Note.
2.10 ZCL agrees, if requested by the Purchaser, to postpone any security
interest it has in all raw materials (meaning all unprocessed or partially
processed materials used in the manufacture, production or shipment of pultruded
products), and accounts receivable of the Purchaser, in favour of any financial
institution providing a commercial lending facility to the Purchaser.
ARTICLE 3 - REPRESENTATIONS AND WARRANTIES OF ZCL
3.1 ZCL hereby represents and warrants, as of the Effective Date and the Closing
Date, with and to the Purchaser as follows, and acknowledges that the Purchaser
is relying on such representations and warranties, all of which are material to
the Purchaser in connection with the purchase and sale of the Assets:
3.1.1ZCL is a corporation duly incorporated and properly organized under
the laws of the jurisdiction of its incorporation and is duly
qualified to transact business and is up to date on all material
corporate filings in each jurisdiction in which the conduct of its
businesses or the ownership of its properties require such
qualifications, and ZCL has all the necessary authority and power to
enter into and perform its obligations pursuant to this Agreement;
3.1.2ZCL is the registered and beneficial owner of the Assets, and on
Closing the Assets will be free and clear of any claims, liens,
encumbrances, charges or security interests whatsoever and ZCL is
entitled to sell the Assets to the Purchaser;
3.1.3All of the trademarks comprising the Intangibles are listed hereto in
Schedule "F";
3.1.4There are no actions or claims, commenced or alleged, against ZCL
relating to its ownership rights in the Intangibles, or alleging
infringement by ZCL as a result of the use of the Intangibles;
3.1.5ZCL has full corporate power and authority to own, lease or use the
Assets and is not aware of any governmental licenses, authorizations,
consents, registrations and approvals which have not been obtained
which are necessary to operate the Business and to own, lease or use
the Assets;
3.1.6All necessary corporate action has been taken by ZCL to approve this
Agreement and the transactions contemplated hereunder to be performed
by ZCL and this Agreement has been duly executed and delivered by ZCL
and
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constitutes valid, legal and binding obligations of ZCL, enforceable
against it in accordance with its terms, subject to the availability
of equitable remedies and enforcement of creditors rights generally;
3.1.7As of the Closing, the entering into of this Agreement by ZCL and the
performance of its obligations hereunder will not result in the breach
or violation of:
3.1.7.1 any of the material terms or provisions of any constating
documents of ZCL or of any material permit, indenture, mortgage,
deed of trust, loan agreement or other material agreement,
written or oral, to which ZCL is a party; or
3.1.7.2 any material law, regulation or applicable order (of which ZCL
is aware) of any Court, arbitrator or governmental authority
having jurisdiction over the Assets or the properties or business
of ZCL;
3.1.8As of the Closing, the execution and delivery of this Agreement and
the performance of the covenants and agreements herein contained are
not limited or restricted by and are not in conflict with any
contract, agreement or other instrument to which ZCL is bound;
3.1.9None of the Assets are subject to any rights of first refusal or
similar rights or restrictions granted by ZCL;
3.1.10 All due and properly owing property, production, business, and
similar taxes and assessments based on or measured by the ownership of
the Assets or the production of goods and services by the Business
have been properly and fully paid and discharged;
3.1.11 ZCL, in conducting its Business, is unaware of any non-compliance
with any material laws, rules and regulations of each jurisdiction in
which such business is carried on, and is unaware of any breach in any
material respect of any such material laws, rules or regulations;
3.1.12 ZCL is a resident of Canada within the meaning of the Income Tax Act
(Canada);
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3.1.13 As of the Closing, ZCL is not in breach or violation of any of the
material terms or provisions of, or in default under, any material
indenture, mortgage, deed of trust, loan agreement or other material
agreement (written or oral) to which they are bound and to which any
of the Assets are subject;
3.1.14 There are no lawsuits in existence or, to the knowledge of ZCL,
proceedings or investigations pending or threatened against ZCL that:
3.1.14.1 challenge the validity of this Agreement with respect to sale
of the Assets or the Business or the transactions contemplated
hereby to be performed by ZCL; or
3.1.14.2 seek to restrain or prevent any action taken or to be taken
by ZCL in connection with this Agreement or the transactions
contemplated hereby;
3.1.15 All computer software and related data associated with the Business,
and relating to the Assets and more particularly relating to customer
data, will be available to the Purchaser for a period of two (2) years
subsequent to the Closing Date;
3.1.16 ZCL shall maintain in full force and effect such policies of
insurance issued by reputable and responsible insurers as will be
maintained with respect to assets similar to the Assets by reasonably
competent businessmen, and such policies of insurance are to be so
maintained until Closing of the transactions contemplated hereby or
until the Purchaser provides proof to ZCL that it has obtained
insurance coverage acceptable to ZCL, which ever first occurs.
ARTICLE 4 - ASSIGNMENT OF CONTRACTS
4.1 ZCL does hereby agree to assign all rights and obligations under the
contracts listed in Schedule "G" hereof provided that ZCL will be responsible
for any claims made under assumed contracts prior to the Effective Date, except
as hereinafter specified, and will be responsible for payment of all obligations
accruing prior to the Effective Date. It is specifically acknowledged and agreed
between the parties hereto that the Purchaser reserves the right to deny
assumption of any contracts which it deems undesirable and the Purchaser will
advise ZCL on the Closing Date which contracts it will not assume. It is further
acknowledged and agreed that ZCL may be obligated to accept returned materials
for credit under a distributorship agreement with each of BMD and Detroit Forest
Products. The Purchaser does hereby agree to assist ZCL to minimize such credits
and to purchase any returned product from ZCL at one-half the value of
applicable credits paid by
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ZCL to these distributors.
ARTICLE 5 - REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
5.1 The Purchaser hereby represents and warrants, as of the Effective Date and
the Closing Date, with and to ZCL as follows, and acknowledges that ZCL is
relying on such representations and warranties, all of which are material to ZCL
in connection with the purchase and sale of the Assets:
5.1.1All necessary corporate actions, resolutions or otherwise will be
taken by the directors of the Purchaser to approve, ratify and confirm
the execution delivery of this Agreement, the Promissory Note, the
General Security Agreements and the Mortgage;
5.1.2The Purchaser is a resident of Canada for the purposes of the
Investment Canada Act (Canada);
5.1.3This Agreement constitutes a valid and legally binding obligation of
the Purchaser and enforceable against the Purchaser in accordance with
the terms of this Agreement;
5.1.4The Purchaser has been incorporated and organized under the laws of
the province of Alberta and is a valid and subsisting corporation in
good standing.
ARTICLE 6 - COVENANTS OF THE PURCHASER
6.1 The Purchaser shall not assume any contracts relative to the Business except
as listed in Schedule "G". In addition, the Purchaser agrees to assist ZCL to
minimize the credits which may be owing to BMD or Detroit Forest Products
pursuant to two distributorship agreements under which ZCL may be obligated to
accept returned materials for credit and does further undertake to purchase any
returned product from ZCL pursuant to these two distributorship agreements at
one-half the value of applicable credits paid by ZCL to these distributors.
6.2 The Purchaser agrees to obtain on the Closing Date, insurance coverage
acceptable to ZCL to be effective upon the transfer of title by ZCL to the
Purchaser on the Closing Date. The Purchaser further acknowledges that it shall
bear the risk of loss of any of the assets not covered by ZCL's existing
insurance coverage on and after April 6, 1998.
6.3 The Purchaser agrees on the Closing Date, to assume those liabilities listed
in Schedule "H" hereof.
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6.4 The Purchaser agrees to provide ZCL with access to all corporate records,
during normal business hours of the Purchaser, related to records prior to the
Effective Date.
ARTICLE 7 - SURVIVAL OF REPRESENTATIONS AND WARRANTIES
7.1 The representations and warranties made by ZCL pursuant to Article 3 of this
Agreement, and the Purchaser pursuant to Article 5, shall survive the Closing on
the Closing Date, and notwithstanding such Closing, shall continue in full force
and effect for the benefit of the Purchaser for two (2) years, and for the
benefit of ZCL, indefinitely.
ARTICLE 8 - EMPLOYEES
8.1 ZCL agrees to advise all of its employees in the Business of this
transaction and shall terminate their employment effective on the Effective
Date. ZCL agrees to pay and satisfy as at the Effective Date all salaries,
wages, termination pay, wrongful dismissal claims, holiday pay, employment
insurance premiums, Workers' Compensation payments, income tax and Canada
Pension Plan deductions and all other payments to be made to or on behalf of the
employees to and including the Effective Date and shall indemnify the Purchaser
with respect to same. The Purchaser shall offer employment to employees of the
Business commencing on the Effective Date, on essentially the same terms and
conditions of employment as offered by ZCL, excluding any employees on long-term
disability or temporary layoff.
ARTICLE 9 - CLOSING
9.1 The Closing of the transaction contemplated by this Agreement shall be
completed at the offices of Bryan & Company, Barristers and Solicitors, 2600
Manulife Place, 10180-101 Street, Edmonton, Alberta T5J 3Y2, Solicitors for the
Purchaser, at 2:00 p.m., Edmonton time, on the Closing Date. At the Closing, ZCL
shall deliver to the Purchaser such documents as are reasonably required to
complete the transaction as contemplated by this Agreement, including, but not
limited to the following:
9.1.1all bills of sale, transfer and assignments as may be necessary to
vest good and marketable title to the Assets in the name of the
Purchaser, free and clear of all liens, charges, encumbrances and
security interests whatsoever;
9.1.2assignment of all right, title and interest of ZCL and those
contracts identified in Schedule "G" hereto which the Purchaser has
agreed to assume together with executed copies of the contracts and
consents of third parties
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to such assumptions as deemed necessary by the Purchaser;
9.1.3assignments of those liabilities identified in Schedule "H" hereto
together with executed copies of the documents creating the
obligations and consents of third parties to such assumptions as
deemed necessary by the Purchaser;
9.1.4 possession of the Assets;
9.1.5such specific assignments or conveyances as the Purchaser may require
with respect to any part of the Assets sold hereunder;
9.1.6 worker's compensation clearance for the operations of the Business;
9.1.7evidence of termination of employees of ZCL in the Business
satisfactory to the Purchaser or its solicitors;
9.1.8all books, records, invoices, statements, files, correspondence and
other materials as presently maintained by ZCL in the operation of the
Business located on the Premises, as of the Closing Date;
9.1.9an opinion of the solicitors of ZCL to the effect that ZCL is a
corporation duly organized, validly existing and in good standing
under the laws of the Province of Alberta with full power, authority
and capacity to execute and deliver this Agreement and that the same
has been duly and validly authorized by all necessary corporate
proceedings of ZCL; and
9.1.10 such further documents and assurances as may be reasonably required
by the Purchaser or its solicitors in order to complete the
transactions contemplated herein;
9.2 At the Closing, the Purchaser shall deliver to ZCL such documents as are
reasonably required to complete the transaction as contemplated by this
Agreement, including but not limited to the following:
9.2.1 the Promissory Note;
9.2.2 the General Security Agreement;
9.2.3 the Mortgage;
9.2.4 the Guarantees;
9.2.5an agreement acceptable to ZCL whereby the Purchaser agrees to supply
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ZCL with pultrusions for hold down straps under which ZCL will be
granted production priority;
9.2.6The opinion of the solicitors of the Purchaser to the effect that the
Purchaser is a corporation duly organized, validly existing and in
good standing under the laws of the Province of Alberta with full
power, authority and capacity to execute and deliver this Agreement,
the Promissory Note and the General Security Agreement and that the
same have been duly and validly authorized by all necessary corporate
proceedings of the Purchaser;
9.2.7executed copies of all assumption agreements required by this
Agreement;
9.2.8an acknowledgement satisfactory to ZCL that the Equipment listed in
Schedule "A" hereto has been received by the Purchaser and that the
Equipment is a complete list of all equipment forming the Assets of
the Business; and
9.2.9such further documents and assurances as may reasonably be required
by the solicitors of ZCL in order to complete the transactions
contemplated herein.
ARTICLE 10 - INDEMNITY
10.1 ZCL agrees to be liable to and to indemnity and does hereby indemnify the
Purchaser from and against any and all claims, actions, losses, damages,
liabilities and costs to which the Purchaser may be put or suffer by or as a
result of any undertaking, representations or warranties set forth herein by ZCL
being incorrect, inaccurate, untrue or breached, including costs on a solicitor
and its own client basis.
10.2 ZCL does hereby further agree to be liable to and to indemnify and does
hereby indemnify the Purchaser from and against any and all claims, actions,
losses, damages, liabilities and costs to which the Purchaser may be put or
suffer by or as a result of any liabilities of the Business which are not
assumed by the Purchaser hereunder, including costs on a solicitor and its own
client basis.
10.3 The Purchaser agrees to be liable to and to indemnify and does hereby
indemnify ZCL from and against any and all claims, actions, losses, damages,
liabilities and costs to which the Purchaser may be put or suffer by or as a
result of any undertaking, representation or warranties set forth herein by the
Purchaser being incorrect, inaccurate, untrue or breached including, including
costs on a solicitor and its own client basis.
10.4 The Purchaser does further agree to be liable to and to indemnify and does
hereby indemnify ZCL from and against any and all claims, actions, losses,
damages, liabilities and costs to
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which ZCL may be put or suffer by or as a result of those liabilities listed in
Schedule "H" hereof which the Purchaser has agreed to assume, and with respect
to liabilities arising from the conduct of the Business after the Effective
Date, including costs on a solicitor and its own client basis.
ARTICLE 11 - GENERAL
11.1 The rights defined by this Agreement shall not be assigned or transferred
by any party.
11.2 All notices, requests, demands or other communications by the terms hereof
required or permitted to be given hereunder shall, unless otherwise specifically
provided for herein be given in writing or shall be either mailed postage
prepaid by double registered mail and faxed or personally served to each party
at its address as follows:
11.2.1 to ZCL:
6907 - 36 Street
Edmonton, Alberta
T6B 2Z6
Attention: Ven Cote, President and Chief Executive
Officer
Fax: 466 - 6126
with a copy to:
Parlee McLaws
Barristers and Solicitors
1500, 10180 - 101 Street
Edmonton, Alberta
T5J 4K1
Attention: Dave Finlay
Fax: (403) 423 - 2870
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11.2.2 to the Principals:
Robert Day - Chairman
#109, 52258 Range Road 231
Sherwood Park, Alberta
T8B 1M7
Phone: (403) 466-6648
Kuldip Delhon
12511 - 29 Avenue
Edmonton, Alberta
T6J 6E1
Phone: (403) 940-0714
Jarnail Sehra
501 Heffernan Drive
Edmonton, Alberta
T6R 2K5
Phone: (403) 461-6666
Dr. Krishen Mehra
39 Westbrook Drive
Edmonton, Alberta
T6J 2C8
Phone: (403) 435-8093
11.2.3 to the Purchaser:
2305 - 8th Street
Nisku, Alberta
T9E 7Z3
Attention: Robert Day
Fax: 955 - 7170
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with a copy to:
Bryan & Company
Barristers & Solicitors
2600, 10180 - 101 Street
Edmonton, Alberta
T5J 3Y2
Attention: Douglas O. Goss
Fax: (403) 428-6324
11.3 The parties do hereby agree that any property or assets of ZCL located on
the Premises at Closing but not included in the Assets purchased by the
Purchaser hereunder may be stored on the Premises free of charge, provided that
the Purchaser shall not be held responsible for the insurance or safe keeping of
such property. ZCL does hereby agree to remove any such property or assets from
the Premises at its expense upon 60 days notice from the Purchaser.
11.4 ZCL does hereby agree that any of the Assets or other property of the
Purchaser located on any of the premises of ZCL may be stored on such premises
free of charge, provided that ZCL shall not be held responsible for the
insurance or safe keeping of such property. The Purchaser shall have this
property removed from the premises of ZCL at the expense of the Purchaser upon
60 days notice from ZCL.
11.5 This Agreement supersedes all other agreements, documents, writings and
verbal understandings among the parties.
11.6 Appended hereto are the following Schedules, which are incorporated into
this Agreement by reference and are deemed to be a part hereof:
Schedule "A" - Equipment
Schedule "B" - Promissory Note
Schedule "C" - General Security Agreement
Schedule "D" - Mortgage
Schedule "E" - Guarantee
Schedule "F" - Patents and Trademarks
Schedule "G" - Contracts
Schedule "H" - Assumed Liabilities
11.7 Time shall be of the essence of this Agreement.
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11.8 No amendment or variations of the provisions of this Agreement shall be
binding upon any party, unless it is evidenced in writing and executed by the
parties.
11.9 The parties agree that this Agreement shall enure to the benefit and be
binding upon the parties and their respective executors, administrators, assigns
and successors.
11.10 If any provision of this Agreement shall be adjudged void, or
unenforceable by a competent court, the remaining provisions of this Agreement
shall continue in full force and effect. This Agreement shall be governed by,
and construed in accordance with, the laws of the Province of Alberta and the
laws of Canada applicable therein, and the parties hereby submit to the
jurisdiction of the courts of the Province of Alberta.
11.11 This Agreement may be executed in several counterparts each of which when
so executed shall be deemed to be an original, and such counterparts shall
constitute one and the same instrument and notwithstanding their date of
execution shall be deemed to bear date as of the 3rd day of June, 1998.
IN WITNESS WHEREOF the Corporate parties have hereto affixed their
corporate seals duly attested by the hands of their properly authorized officers
in that behalf and the individual parties have executed this Agreement all on
the day and year first written above.
ZCL COMPOSITES INC.
PER: /s/ Venance Cote
-----------------------------------------
PER: /s/ Tony Barlot
-----------------------------------------
PULTRONEX CORPORATION
PER: /s/ Robert Day
----------------------------------------
PER: /s/ Jarnail Sehra
----------------------------------------
SIGNED, SEALED AND DELIVERED in the presence of:)
)
)
/s/ Douglas O. Goss ) /s/ Robert Day
- ------------------------------- ) -----------------------------
Witness Robert Day
Barrister and Solicitor
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SIGNED, SEALED AND DELIVERED in the presence of: )
)
)
/s/ Douglas O. Goss ) /s/ Kuldip Delhon
- ------------------------------- ) ----------------------------
Witness Kuldip Delhon
Barrister and Solicitor
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SIGNED, SEALED AND DELIVERED in the presence of: )
)
)
/s/ Douglas O. Goss ) /s/ Krishen Mehra
- ------------------------------------- ) ----------------------------
Witness Krishen Mehra
Barrister and Solicitor
SIGNED, SEALED AND DELIVERED in the presence of: )
)
)
/s/ Douglas O. Goss ) /s/ Jarnail Sehra
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Witness Jarnail Sehra
Barrister and Solicitor
(82)
SCHEDULE "A"
EQUIPMENT
(83)
SCHEDULE "B"
PROMISSORY NOTE
(84)
SCHEDULE "C"
GENERAL SECURITY AGREEMENT
(85)
SCHEDULE "D"
MORTGAGE
(86)
SCHEDULE "E"
GUARANTEE
(87)
SCHEDULE "F"
PATENTS AND TRADEMARKS
Canadian Trademark: E-Z Deck
TMA 469,065
Reg: January 20, 1997
US Trademark: E-Z Deck
#1,969,571
Reg: April 23, 1996
Declaration of Use required by April 23, 2001
Canadian Trademark: E-Z Fence
TMA 473,957
Reg: March 27, 1997
(88)
SCHEDULE "G"
CONTRACTS
(a) ZCL and Can-Cell Industries Inc., dated October 1, 1994
(b) ZCL and Ace Hardware Corporation, dated October 6, 1997, effective date
January 1, 1998
(c) ZCL and All-Coast Forest Products Inc., dated July 15, 1996, distribution
for the United States
(d) ZCL and Alta Mont Wholesale Co. dated March 18, 1996, distribution for
Southern Illinois
(e) ZCL and Prince Corporation dated October 18, 1995, distribution for
Wisconsin and upper peninsula of Michigan
(f) ZCL and Westech Building Products, dated December 1, 1995, distribution for
Alberta and British Columbia
(g) ZCL and Allied Plywood Corporation
(h) ZCL and Can-Save agreed to August 15, 1997
(i) ZCL and Cameron Ashley Building Products
(89)
SCHEDULE "H"
ASSUMED LIABILITIES
The Purchaser assumes any and all liabilities relating to the Pultrusion
division operations for the following:
- - Warranty obligations, whether arising from the period before or after the
Effective Date
- - Lease contracts, except for any portion of expenses relating to the period
prior to March 31, 1998
- - Obligations relating to all distributor agreements listed in Schedule "G"
hereto, except for the return of product for credit from BMD and Detroit
Forest Products for which the Purchaser will purchase any returned product
for one-half the value of the applicable credit paid to these distributors
- - All expenses and costs relating to the operations after March 31, 1998,
including taxes, assessments, insurance, employee related costs, permits,
licenses, registrations, and costs relating to intangible assets
- - Environmental obligations relating to the operations, products and
premises, whether arising from the period before or after the Effective
Date
(90)
PULTRONEX CORPORATION
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ASSET PURCHASE AND SALE AGREEMENT
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(91)