AGREEMENT FOR THE PURCHASE AND SALE OF ASSETS
AGREEMENT made as of this 12th day of January, 1996, by and between
Met-Coil Systems Corporation, a Delaware corporation located at 0000 0xx
Xxxxxx, X.X., Xxxxx Xxxxxx, Xxxx 00000, ("Met-Coil"), Xxxx Machinery &
Automation, Inc., a Texas corporation, located at 000 Xxxxx Xxx, Xxxxxx,
Xxxxx ("Seller"), and Mestex,Ltd., a Texas limited partnership with offices
located at 0000 Xxxxxxxxx Xxxxx, Xxxxxx, Xxxxx 00000 ("Purchaser").
RECITALS
A. Met-Coil is the owner of all right, title and interest in and to all of
the issued and outstanding shares of Xxxx.
B. Seller is the owner of certain assets including machinery, equipment,
and other tangible personal property, inventory, work- in-process, rights under
agreements, accounts or notes receivable, intellectual property, permits,
goodwill and other books, records, information and materials required or
appropriate for the continued operation of that certain business that
manufactures and sells the line of press feed and cut-to-length machinery,
equipment, accessories and related repair and service parts sold under the name
Xxxx (the "Xxxx Business") (as further defined in Section 1 of this Agreement).
C. Met-Coil and Seller desire and intend to sell the assets and certain
liabilities associated with the Xxxx Business of Seller to Purchaser at the
price and on the terms and conditions hereinafter set forth.
D. Purchaser desires and intends to purchase the assets and assume certain
liabilities of Seller associated with the Xxxx Business at the price and on the
terms and conditions hereinafter set forth.
AGREEMENTS
NOW, THEREFORE, in consideration of the terms hereof, the parties
hereto, intending to be legally bound hereby, agree as follows:
1. Purchase and Sale of Assets
1.1. The Assets. Upon the closing of the transactions contemplated under
this Agreement on January 31, 1996, or such other date as mutually agreed by the
parties (the "Closing Date"), and subject to the terms and conditions contained
in this Agreement, Seller shall sell, transfer, convey, assign and deliver to
Purchaser, and Purchaser shall purchase, acquire and accept from Seller, free
and clear of all liens, encumbrances, restrictions and adverse charges of any
nature whatsoever, except as may be
1
permitted by Section 7.7, all of the assets, rights, interests, properties
and goodwill of every nature whatsoever, tangible or intangible and wheresoever
situated, required or appropriate for the continued operation of the Xxxx
Business which is further defined as the manufacture, application, design,
development, engineering, distribution and sale of various models and types of
press feeding and cut-to-length automation equipment and machinery and the parts
and accessories related thereto set forth by name and drawing number category in
Schedule 1.1 attached hereto. The assets, rights, interests, properties and
goodwill sold, transferred, conveyed, assigned and delivered by Seller to
Purchaser hereunder (collectively, thetively, the "Assets") shall include, but
shall not be limited to the following: "Assets") shall include, but shall not be
limited to the following:
1.1.1. Personal Property. All of the jigs, dies, patterns, and tooling
fixtures of Seller used in the Xxxx Business identified in Schedule 1.1.1 (the
"Personal Property"), together with any rights of Seller to all warranties, if
any, and to the extent assignable, received from the manufacturers and sellers
of such items, all as relates to the operation of the Xxxx Business;
1.1.2. Inventory. All saleable, usable, undamaged, non-obsolete and
non-slow-moving inventory of Seller relating to the Xxxx Business including raw
materials, work-in-process, and finished goods (the "Inventory") to be
physically counted on or about the Closing Date and listed and attached to this
Agreement thereafter as Schedule 1.1.2;
1.1.3. Material Agreements. Subject to required consents (by customers of
Seller, lessors and tangible asset suppliers), all right, title and interest of
Seller in, to and under executory contracts (including the right to the return
of any and all deposits), the sales backlog and other contract rights and
agreements to provide equipment and services to the Xxxx Business customers of
Seller, representative agreements, leases of personal property, licenses,
purchaser orders, sale orders and joint venture, partnership and other
agreements related to the ownership or operation of the Xxxx Business all as
identified and listed by Purchaser in Schedule 1.1.3 that shall be affirmatively
and expressly assumed by Purchaser (the "Material Agreements");
1.1.4. Intellectual Property. All patents, patent applications, trademarks
(including the trademark "Xxxx"), service marks, tradenames, copyrights and
copyright applications and licenses with respect to any of the foregoing all as
identified in Schedule 1.1.4 and all inventions, inventor's notes, discoveries,
trade secrets, ideas, proprietary processes and formulae, whether patentable or
not, improvements, engineering drawings, computer- assisted design and
manufacturing data, bills of material, designs and specifications (including
design choices), computer software and laboratory certifications, proprietary
and trade rights and data, ideas and know-how, whether patentable or not, and
all shop rights, manufacturing data, licenses, and other intellectual property
and all correspondence related thereto that are used in
2
the Xxxx Business (all of which are hereinafter collectively referred to as
the "Intellectual Property"); however, notwithstanding the foregoing, nothing
herein shall be deemed a transfer of any rights to intellectual property related
to the Fen- Pro machinery operations of Seller;
1.1.5. Receivables. All accounts or notes receivable, prepaid expenses and
contract rights of Seller relating to the Xxxx Business as of the Closing Date,
including those identified in Schedule 1.1.5 attached hereto, arising from the
operation of the Xxxx Business (the "Receivables");
1.1.6. Permits. All of Seller's right, title and interest in and to any and
all permits, licenses, authorizations, certifications, consents, orders,
registrations and approvals or any federal, state or local governmental entity
or certifying or regulatory agency or authority required of Seller or otherwise
necessary or advisable for the operation of the Xxxx Business as set forth on
Schedule 1.1.6 attached hereto (the "Permits") to the extent the same are
transferable or assignable to Purchaser;
1.1.7. Books and Records. All of Seller's right, title and interest in or
to all books of account, records, files and invoices, including but not limited
to technical and scientific literature, all invoice files kept by serial number,
model or customer and correspondence related thereto, all production data,
testing data, equipment maintenance data, employee files, payroll information
system, accounting records, inventory records, purchasing records, engineering
records, sales and sales promotional data, advertising materials, customer lists
and customer data, cost and pricing information, supplier and vendor lists,
installation and maintenance manuals, business plans, supply reference catalogs
and any other records and data used in connection with the Xxxx Business
(whether in computer software, data or any other form) (the "Books and Records")
other than the minute book and records of shareholder and director action by
Seller; and
1.1.8. Goodwill. The goodwill associated with the Xxxx Business (the
"Goodwill").
1.2. Conveyance of Assets. The sale, transfer, conveyance, assignment and
delivery of the Assets provided for in this Section 1 shall be made by (i) a
duly executed xxxx of sale, evidencing the warranty provisions of this
Agreement, and substantially in the form of Exhibit 1.2 attached hereto (the
"Xxxx of Sale") and (ii) such other good and sufficient instruments of
conveyance and transfer as shall be reasonably necessary to vest in Purchaser as
of the Closing Date, full title to the Assets being sold, transferred, conveyed,
assigned and delivered hereunder.
1.3 Off-Site Assets. All tangible Assets held at any
location other than the Dallas facility of Seller are described on
Schedule 1.3 which schedule includes a description of each of such
3
assets, its type, the name and address of the vendor or customer
holding such assets and, if such asset is held pursuant to an
agreement, a copy or description of such agreement is attached to
the schedule.
2. Excluded Assets. The assets excluded from this Agreement (the
"Excluded Assets") are all assets of Seller not specifically
identified in Section 1.
3. Purchase Price
3.1. Calculation of Purchase Price. The purchase price (the
"Purchase Price") of the Assets to be acquired by Purchaser from
Seller shall be the sum of the following:
3.1.1. The amount of Three Million and 00/100 Dollars
($3,000,000.00) for the Personal Property, Material Agreements,
Intellectual Property, Permits, Books and Records and Goodwill; and
3.1.2. An amount equal to the net tangible asset value
defined as the following:
(a) the actual value on the Closing Date of the
Inventory calculated pursuant to the terms of Section 7.15(a) of
the Agreement, plus the actual value of the collectible Receivables
as described in Section 7.12 of the Agreement that are purchased by
Purchaser,
(b) less the value of all of the obligations of
Seller including all trade accounts payable, customer deposits and
other obligations of and associated with the Xxxx Business that are
expressly assumed by Purchaser under this Agreement.
3.2 Payment of Purchase Price
3.2.1 On the Closing Date, the portion of the Purchase
Price identified in Section 3.1.1 of the Agreement shall be paid by
Purchaser delivering to Seller a promissory note in the amount of
$3.0 million substantially in the form attached hereto as Exhibit
3.2.1 (the "Initial Note"). The Initial Note shall be payable
within five (5) business days of Met-Coil and Seller completing the
refinancing of its debt currently held by Xxxxxx Bank as lead
lender, on December 31, 1996, whichever is earlier. The parties
are deferring the payment of the Purchase Price under the Initial
Note in order to insure a smooth transition of the Xxxx Business
and the continued, uninterrupted operation of the Dallas
manufacturing facility. Purchaser desires to purchase the Assets
of Seller; however, Purchaser's agreement to pay a premium amount
of Purchase Price is expressly conditioned upon a smooth transition
of the Xxxx Business and continued operation in the Dallas
manufacturing facility. A stable lending relationship among Met-
Coil, Seller and its secured lenders is deemed by Purchaser to be
essential to a smooth transition. Therefore, the payment of the
Purchase Price in cash shall be delayed until the new lending
4
relationship contemplated by Seller and Met-Coil and represented to
Purchaser by Seller and Met-Coil to be imminent, is executed,
delivered and funded. In the event that such a new lending
relationship is not closed and Met-Coil seeks bankruptcy protection
or otherwise ceases to engage in business, the value of the Xxxx
Business and the Assets to Purchaser would be substantially
diminished. Consequently, the Initial Note contains a provision
that the Purchase Price will be readjusted significantly downward
in the event of a bankruptcy or dissolution of Met-Coil.
3.2.2 On the Closing Date the portion of the Purchase
Price identified in Section 3.1.2 shall be paid by Purchaser
delivering to Seller an adjustable note substantially in the form
attached hereto as Exhibit 3.2.2 (the "Adjustable Note"). The terms,
conditions, covenants and procedures whereby the principal amount
of the Adjustable Note shall be adjusted based upon the actual
count of the Inventory, the application of the terms of the
representations and warranties set forth in Sections 7.12 and 7.15
of the Agreement and the covenant of Seller set forth in Section
10.7 of this Agreement, are set forth more fully in Section 3.3 of
this Agreement and the Adjustable Note. The amount of any state or
local transfer, conveyance or recordation taxes imposed by the
state or municipality on the transfer of title of the Personal
Property shall be paid by Seller.
3.3 Adjustment to Principal Amount of Adjustable Note
3.3.1 Adjustment. Purchaser and Seller agree that the original principal
amount of the Adjustable Note has been calculated by adding the face amount of
the accounts receivable of Seller at the latest date available prior to the
Closing Date but not earlier than December 31, 1995, and the amount of the book
value of the inventory of Seller at the latest date available prior to the
Closing Date but not earlier than November 30, 1995, and subtracting therefrom
the value of the trade accounts payable, customer deposits, accrued liabilities
and other obligations of Seller that will be expressly assumed by Purchaser at
the latest date available prior to the Closing Date but not earlier than
December 31, 1995. Purchaser and Seller further agree that the principal amount
of the Adjustable Note shall be adjusted upward or downward as appropriate,
dollar for dollar, as follows:
(a) downward by the amount of the value of all
liabilities and obligations of Seller relating to and arising from
the ownership and operation of the Assets and the Xxxx Business
prior to the Closing Date (whether unrecorded trade accounts
payable, accrued liabilities, customer deposits or other
obligations of Seller), that were not included in the initial
determination of the original principal amount of the Adjustable
Note, that have been paid or accrued for payment by Purchaser at
the time of the final calculation of the principal amount due under
the Adjustable Note;
5
(b) downward by the aggregate amount of the face value
of all accounts receivable of Seller that was used in determining
the original principal amount of the Adjustable Note, that are not
collected by Purchaser by May 31, 1996;
(c) upward or downward, as the case may be, by the
amount that the value of the Inventory of Seller, determined based
upon the physical count thereof held on or about the Closing Date,
exceeds or falls short of the amount of the value of the inventory
of Seller that was used in determining the original principal
amount of the Adjustable Note;
(d) downward by an amount equal to the value of those
items in the inventory of Seller determined by the authorized
representatives of Purchaser and Seller to be obsolete, damaged,
defective or without manufacturing value;
(e) downward by an amount equal to the value of those
slow-moving items in the inventory of Seller determined by the
authorized representatives of Purchaser and Seller to be not
consumable in the ordinary course of the manufacture and sale of
the products of the Xxxx Business in the 24-month period after the
Closing Date; and
(f) downward by an amount equal to fifty percent (50%)
of the value of those slow-moving items in the inventory of Seller
determined by the authorized representatives of Purchaser and
Seller to be not consumable in the ordinary course of the
manufacture and sale of the products of the Xxxx Business in the
12-month period after the Closing Date but not otherwise included
as slow-moving items under Section 3.3.1(e).
Any inventory of Seller determined to be slow-moving under Section
3.3.1(e) of the Agreement shall remain the property of Seller and
it shall be segregated from the Inventory transferred to Purchaser
and disposed of at Seller's discretion. Any inventory of Seller
determined to be slow-moving under Section 3.3.1(f) of the
Agreement shall be included in the Inventory transferred to
Purchaser hereunder.
3.3.2 Terms Relating to Adjustment. Seller shall use
its best efforts to value the physical count of the Inventory to be
taken immediately after the Closing Date at its earliest
convenience, but not later than forty (40) days after the Closing
Date. The parties shall work together making such personnel and
records available as necessary to determine and finalize the
adjustments to the principal amount of the Adjustable Note in good
faith at their earliest convenience based upon the valuation of the
physical count of the Inventory, the calculations and standards set
forth in Section 3.3.1, the representations and warranties set
forth in Sections 7.12 and 7.15 of the Agreement and the covenant
of Seller set forth in Section 10.7 of the Agreement. The final
adjusted amount payable and the calculation of the adjustments to
the Adjustable Note shall be set forth in a memorandum of
6
understanding prepared and executed by the authorized
representative of each of the parties. The adjusted amount due
under the Adjustable Note shall be paid in cash to Seller within
five (5) business days of the execution of such memorandum of
understanding and upon such payment the Adjustable Note shall be
stamped "paid in full", canceled and returned to Purchaser.
4. Allocation of Purchase Price. The Purchase Price shall be
allocated by the parties hereto among the Assets as set forth in a
memorandum of allocation delivered on the Closing Date
substantially in the form attached hereto as Exhibit 4.0 (the
"Memorandum of Allocation"). Notwithstanding any allocation by the
parties, Purchaser agreed to purchase and Seller has agreed to sell
the Assets, and the allocation is not intended and shall not be
deemed to constitute an agreement between the parties to transfer
less than all of the Assets. Furthermore, such allocation has been
made solely to ascribe fair value to the Assets and any benefits
deriving therefrom shall not inure to any other third party.
5. Assumption of Liabilities
Upon the Closing Date, Purchaser shall assume or discharge the
following liabilities of Seller:
5.1. Assumed Liabilities. Those trade accounts payables and
customer deposits and other obligations of Seller associated with
the Xxxx Business as specifically set forth by Purchaser and Seller
in Schedule 5.1 attached hereto as they exist as of the Closing
Date.
5.2. Assumption of Material Agreements. The obligations and
liabilities of Seller with respect to the assignment to Purchaser
of the Material Agreements described in Section 1.1.3 and listed on
Schedule 1.1.3.
5.3. Limits on Assumption. Except for the assumptions or
discharges of liabilities described in Sections 5.1 and 5.2,
Purchaser shall not assume (a) other liabilities, obligations and
commitments of Seller, whether fixed or contingent, legal or
equitable, mature or inchoate, written or oral, express or implied,
known or unknown, including, but not limited to those related to
taxes, employment practices, employee benefits and pensions,
implied warranty, maintenance and products or professional
liability, and environmental, health and safety obligations all
related to, arising from or in connection with the Xxxx Business
for products manufactured and services performed prior to the
Closing Date and (b) those liabilities, obligations and commitments
of Seller that arise after the Closing Date, and the
indemnification provisions contained in Article 16 shall apply to
any liability of Seller which is not assumed by Purchaser and which
is asserted or claimed by any person against Purchaser.
5.4. Assignment of Contracts and Rights. Notwithstanding
anything in this Agreement to the contrary, this Agreement shall
7
not constitute an agreement to assign the Material Agreements or
any claim, contract, license, lease, commitment, sales order,
purchase order or any claim or right or any benefit arising
thereunder or resulting therefrom if the agreement to assign or
attempt to assign, without the consent of a third party, would
constitute a breach thereof or in any way adversely affect the
rights of Purchaser or Seller thereunder. Until such consent is
obtained, or if an attempted assignment thereof would be
ineffective or would affect the rights of Seller thereunder so that
the Purchaser would not in fact receive all such rights, Purchaser
and Seller will cooperate with each other in any arrangement
designed to provide for Purchaser the benefits of, and to permit
Purchaser to assume, insofar as expressly set forth herein, stated
liabilities under the Material Agreement including enforcement at
the request and expense and for the benefit of Purchaser of any and
all rights of Seller against a third party thereto arising out of
the breach or cancellation thereof by such third party or
otherwise. Any transfer or assignment to Purchaser by Seller of
any property or property rights or any contract or agreement which
shall require the consent or approval of any third party shall be
made subject to such consent or approval being obtained.
6. Covenants Against Competition
6.1. Covenant Not to Compete. Met-Coil and Seller each
covenant and agree that neither it nor its affiliates shall at any
time within the five (5) year period immediately following the
Closing Date (a) have any ownership interest in any firm,
corporation, partnership, proprietorship or other business that
engages with third parties in the activities now engaged in and in
the territory served by the Xxxx Business with respect to the press
feed portion of the Xxxx Business and (b) use any proprietary
information, drawings or designs with respect to the cut-to-length
portion of the Xxxx Business for its own or any third parties'
benefit or account, so long as Purchaser or any affiliate or
successor thereof, remains engaged in the Xxxx Business; provided,
however, that Seller may own, directly or indirectly, solely as an
investment, securities, or any entity which are publicly traded if
Seller does not, directly or indirectly, own five percent (5%) or
more of any class of securities of any such competitive entity. It
is further understood by the parties that Iowa Precision
Industries, an affiliate of Met-Coil, is in the business of
manufacturing cut-to-length lines and will continue to operate in
that market in a competitive capacity subject only to the express
prohibitions of this Section 6.1.
6.2. Non-competition Agreement. The obligations of Met-Coil
and Seller under this Section 6 shall be set forth fully in a non
competition agreement substantially in the form attached hereto as
Exhibit 6.2 (the "Noncompetition Agreement"). The Noncompetition
Agreement shall be executed by Met-Coil and Seller on the Closing
Date.
8
6.3. Remedies. Without waiving the Purchaser's rights to
monetary damages, all parties to this Agreement acknowledge that
the breach of the obligations contained in this Article 6 would
result in substantial but indeterminable harm to Purchaser, that
the restraints imposed are reasonable, that there is no adequate
remedy at law for a breach of such obligations, and that therefore
injunctive relief, specific performance or other equitable remedies
are appropriate to enforce the obligations undertaken in this
Article 6. In the event that a court finds that the term,
territory, or scope of this Article 6 is too broad to be
enforceable, Seller and Purchaser further agree that a reformation
of the terms of this Article 6 is appropriate and should be
undertaken by the court in order to protect the value of the Assets
being conveyed pursuant to this Agreement as a going concern, and
to provide for the enforceability of the obligations contained in
this Article 6 to the fullest extent allowed by law and equity.
7. Representations and Warranties of Seller
Seller (and, where applicable, Met-Coil) represents and
warrants to Purchaser as of the Closing Date as follows:
7.1. Corporate Existence. Seller is a corporation duly
organized, validly existing and in good standing under the laws of
the State of Texas and Met-Coil is a corporation duly organized,
validly existing and in good standing under the laws of the State
of Delaware and Seller knows of no violation of the requirement for
good standing in any other jurisdiction in which it is required to
be qualified to carry on the Xxxx Business. Seller has full
corporate power and authority to carry on the Xxxx Business as now
being conducted. Met-Coil currently owns all of the issued and
outstanding shares of Seller subject to the lien and secured
interest of Xxxxxx Bank as agent for the secured lenders which will
not be released at the Closing Date.
7.2. Due Authorization and Enforceability. Seller and Met-
Coil have full corporate power and authority to execute and deliver
this Agreement, the Certificate of Assumption, the Xxxx of Sale,
Memorandum of Allocation, Noncompetition Agreement, Lease
Agreement, Guarantee and the other documents, instruments and
agreements to which each is a party to be delivered upon the
Closing Date (collectively, the "Related Agreements"), and to
consummate the transactions contemplated hereby and thereby. The
execution and delivery of this Agreement and the Related Agreements
by Seller and Met-Coil and the consummation of the transactions
contemplated hereby and thereby have been duly authorized by all
necessary corporate actions and no other corporate action or
proceeding on the part of Seller or Met-Coil is necessary to
authorize the execution and delivery of this Agreement or the
Related Agreements or the consummation by Seller of the
transactions contemplated hereby or thereby other than the consent
of Xxxxxx Bank as agent for the secured lenders, which consent is
a condition to closing. This Agreement and the Related Agreements
have been duly executed and delivered by Seller and Met-Coil, as
9
applicable, and this Agreement and the Related Agreements are
legal, valid and binding obligations of Seller and Met-Coil,
enforceable against each of Seller and Met-Coil in accordance with
their terms.
7.3. No Conflicts. Except as set forth in Schedule 7.3,
neither the execution and delivery of this Agreement or the Related
Agreements nor the consummation of the transactions contemplated
hereby or thereby will (i) conflict with or violate any provision
of the Articles of Incorporation or Bylaws of either of Seller and
Met-Coil, (ii) conflict with or violate any law, rule, regulation,
ordinance, order, writ, injunction, judgment or decree applicable
to the Xxxx Business or by which any of the Assets are bound or
affected or (iii) conflict with or result in any breach of or
constitute a default (or an event which with notice or lapse of
time or both would become a default) under, or give to others any
rights of termination or cancellation of, or accelerate the
performance required by or maturity of, or result in the creation
of any security interest, lien, charge or encumbrance on any of the
Assets pursuant to any of the terms, conditions or provisions of,
any note, bond, mortgage, indenture, permit, license, franchise,
lease, contract or other instrument or obligation to which Seller
is a party or by which any of the Assets are bound or affected;
except those Liens permitted by Section 7.7 and in the case of (ii)
or (iii) above, for such conflicts, violations, breaches, defaults,
terminations, cancellations and accelerations which in the
aggregate will not have a material adverse effect on the Xxxx
Business.
7.4. Financial Statements. Attached as Schedule 7.4 are the
balance sheets of Seller as of the fiscal year ended May 31, 1995,
and as of the interim period ended November 30, 1995, and the
related statements of income, for the respective fiscal year and
interim period then ended (all of the financial statements referred
to above in this Section 7.4 are herein collectively referred to as
the "Seller Financial Statements"). The Seller Financial
Statements fairly present the assets, liabilities and financial
position of Seller as of the respective dates set forth therein and
the results of operations and changes in financial position of
Seller for the respective periods set forth therein; the Seller
Financial Statements have been prepared in each case in conformity
with generally accepted accounting principles ("GAAP") applied on
a consistent basis throughout the periods involved.
7.5 No Material Changes. Except as set forth in Schedule
7.5, since May 31, 1995, (i) there have been no changes in the
Assets or the liabilities (actual or contingent) of Seller or in
the nature and prospects of the Xxxx Business or its condition
(financial or otherwise) which have in the aggregate been material
and adverse to the Xxxx Business, and, (ii) Seller has operated the
Xxxx Business in the ordinary course and consistent with past
practice.
10
7.6 All Necessary Assets. The Assets (including the Personal
Property, Inventory, Material Agreements, Intellectual Property,
Receivables, Permits, Books and Records and Goodwill) being sold,
transferred, conveyed, assigned and delivered by Seller under this
Agreement constitute all of the assets used by Seller in the
conduct of the Xxxx Business, except for the land, building,
improvements, machinery and equipment and office furniture of
Seller which is not being conveyed to Purchaser under this
Agreement.
7.7 Title to Assets. Seller warrants that Seller has good
and marketable title to the Assets transferred hereunder and, upon
consummation of the transactions contemplated by this Agreement,
including execution and delivery of the Xxxx of Sale or other
instruments of transfer, Purchaser will acquire title to the
Assets, free and clear of all mortgages, pledges, liens, security
interests, assignments, conditional sales agreements, encumbrances,
claims or charges of any kind ("Liens"), except for (i) Liens
created by Purchaser and, (ii) Liens set forth on Schedule 7.7
which Seller shall satisfy immediately or prior to the Closing
Date. At the Closing Date, none of the Assets will be subject to
any commitment or other arrangement for its sale or use by third
parties except under Material Agreements disclosed in Schedule
1.1.3.
7.8 Condition of Assets. Except as set forth in Schedule
7.8, the Personal Property included in the Assets set forth in
Schedule 1.1.1 is in good operating condition and repair, ordinary
wear and tear excepted and is reasonably satisfactory for the
purposes for which the Assets are being used, and is capable of
being used to carry on the Xxxx Business.
7.9 Compliance with Laws. The operation of the Xxxx
Business and the use of the Assets comply in all material respects
with all applicable laws, ordinances, rules, decrees, orders and
regulations, including federal and state and local environmental
laws and rules and laws related to employment, benefits, and
pensions (collectively the "Laws"), except for such failures to
comply which in the aggregate will not have a material adverse
effect on the Assets or Xxxx Business. Seller has obtained all
necessary permits, licenses, certificates, exemptions, orders and
approvals and has filed all required notices with federal, state
and local governmental bodies that are required by applicable law
for the use of the Assets and in order to conduct the Xxxx Business
as presently conducted, all of which are valid and effective on the
date of this Agreement and will be valid at the Closing Date, and
all payments, fees and costs thereof have been paid in full to the
date of this Agreement and will be paid in full at the Closing
Date. Seller has not received notice of any violations of any Laws
or regulations or any covenants or contracts with respect to the
Xxxx Business or any of the Assets, and to Seller's knowledge, no
such notice of violations is pending or has been threatened.
11
7.10 Absence of Litigation. There are no judgments or other
judicial or administrative orders outstanding against Seller, nor
is there any action, suit or proceeding at law or in equity or by
or before any governmental or administrative instrumentality or
other agency now pending or, to the knowledge of Seller, threatened
against or affecting Seller, the Assets or any of Seller's property
or rights which, if adversely determined, might materially impair
the right or ability of Seller to carry on the Xxxx Business as it
is now conducted or as proposed to be conducted or would materially
adversely affect the financial condition of Seller. A true,
correct and complete list of all suits or proceedings at law, in
equity or by or before any governmental or administrative
instrumentality or other agency and other litigation (whether
material or not) pending or threatened against Seller, or settled
within the last five (5) years noting those which involve the Xxxx
Business is attached hereto as Schedule 7.10. Seller is not in
default in any material respect under any applicable statute, rule,
order, certificate or regulation of any governmental authority
having jurisdiction over it. Seller has conducted the Xxxx Business
in such a manner so that there have been no occurrences that have
given or will give rise to products liability or breach of warranty
on the part of Seller.
7.11 Material Agreements. Schedule 1.1.3 is an accurate and
complete list of all of Seller's Material Agreements of any kind as
to which the rights and/or obligations are being assumed or
discharged by Purchaser. There are no other Material Agreements
being assumed by Purchaser. Each of the Material Agreements is
valid and effective in accordance with its terms. True and correct
copies of the Material Agreements have been supplied to Purchaser
by Seller, appropriately identified in order that such Material
Agreements can be identified on Schedule 1.1.3. At the Closing
Date, all consents to the assumptions of the obligations of Seller
by Purchaser under the Material Agreements will have been obtained.
All other executory contract rights or obligations of Seller
related to the Xxxx Business, not listed on Schedule 1.1.3 and
therefore not being assumed by Purchaser, are listed in Schedule
7.11. No party to any of the Material Agreements (including
Seller) is in material default thereunder and no event has occurred
which with the passage of time or the giving of notice or both
would constitute a material default under any of the Material
Agreements.
7.12 Receivables. The Receivables being conveyed hereunder
and listed in Schedule 1.1.5, will, at the Closing Date, be owned
by Seller, free and clear of all claims, encumbrances, credits,
backcharges, counterclaims, setoffs and deductions, and are not
subject to additional requirements of performance by Seller, and
such Receivables have not been billed or collected for a greater
percentage of the work done or materials supplied than has actually
been performed or supplied by Seller, except as set forth in
Schedule 7.12. Seller guarantees to Purchaser that every dollar of
the Receivables shall be collected by Purchaser.
12
7.13 Patents and Trademarks. Schedule 1.1.4 lists all
patents, patent applications, trademarks and service marks and
applications therefor, owned by Seller and heretofore used in the
conduct of the Xxxx Business, none of which has been held or
stipulated to be invalid in any litigation which has been concluded
and the validity of none of which has been questioned in any
litigation currently pending or which, to the best knowledge of
Seller, has been threatened. Seller owns or possesses and will
have conveyed to Purchaser at the Closing Date all Intellectual
Property used in the Xxxx Business, and the Intellectual Property
does not, to the best knowledge of Seller, infringe any patent or
other rights owned by others, nor has Seller received any notice of
conflict thereof with the asserted rights of others.
7.14 Related Party Agreements. No affiliate, officer or
director of Seller or Met-Coil or any related person has, directly
or indirectly, entered into any transaction with Seller relating to
the Xxxx Business, except for any arrangements reflected on the
Seller Financial Statements and described in Schedule 7.14. For
purposes of this Agreement, the term "related person" shall mean
and include any person related to any affiliate, officer or
director of Seller or Met-Coil by blood or by marriage, or any
corporation, partnership, proprietorship, trust or other entity in
which any officer or director of Seller (or any spouse, ancestor or
descendant of the same) has more than a five percent (5%) legal or
beneficial interest.
7.15 Inventory. The Inventory of Seller included in the
Assets (whether raw materials, purchased components, manufactured
parts, work-in-process, finished goods or other) does not contain
any damaged, defective, slow-moving (defined as more than a one
years' supply under normal conditions of sale) or obsolete items
which are not currently usable or saleable in the ordinary course
of the Xxxx Business.
(a) Raw materials and purchased components shall be
valued individually at the lower of acquisition costs or market
value in accordance with GAAP consistently applied. Acquisition
costs shall be determined on an item-by-item, FIFO basis and shall
be determined by using the standard costs of Seller in effect at a
date no later than October 31, 1995, adjusted upward or downward on
a case-by-case basis to account for instances where standard costs
differ materially from acquisition costs or market costs. Work-in-
process consisting of manufactured parts, sub-assemblies and
equipment in the process of being assembled and finished goods
shall be valued at the sum of the value of the raw material and
purchased components, direct labor and factory burden applicable to
said items of work-in-process and finished goods as further set
forth herein: (i) raw materials and purchased components shall be
valued at the lower of acquisition costs or market value in
accordance with GAAP consistently applied, (ii) direct labor shall
be valued at Seller's labor standards and rates which are based on
standard direct labor minutes multiplied by the standard direct
13
labor rate in effect at December 31, 1995, and (iii) standard
factory burden shall be expressed as a percentage of standard
direct labor costs, for the respective products, which percentage
shall be those used by Seller as of December 31, 1995, adjusted to
eliminate the cost of (i) the wages, fringe costs and expenses of
the service department that are not directly related to pre-
shipment service of products, and (ii) any costs inconsistent with
GAAP in the calculation of burden.
(b) The value at which the Inventory is shown on the
Seller Financial Statements for the interim period ending November
30, 1995, has been determined in accordance with the standard
valuation policy of Seller, consistently applied and in accordance
with GAAP.
(c) All items of Inventory on hand at the Dallas
facility of Seller that are included in the physical counts at the
Closing Date, but not yet set forth or reflected in Seller's
accounts payable reported in the Seller Financial Statements, shall
be disclosed to Purchaser on Schedule 7.15.
(d) All items of Inventory (and their location) held
at locations other than Seller's Dallas facility at the Closing
Date shall be disclosed fully to Purchaser on Schedule 1.3.
7.16 Taxes. With respect to the Xxxx Business and the Assets
being conveyed under this Agreement, Seller has filed all federal,
state, county and local tax returns, including information returns,
which it is required by law to file and has paid all income,
payroll, withholding, gross receipts, excise, occupation, sales,
use or other taxes, assessments and other governmental charges due
in respect of such returns, except to the extent that any such
taxes are being contested in good faith and as to which adequate
reserves have been set aside and Seller has accrued all taxes not
yet due. Since December 31, 1995, Seller has not incurred any
taxes other than taxes incurred in the ordinary course of business,
and all such taxes are fully reserved against on the books of
Seller. Seller is not delinquent in the payment of any amount of
taxes, and there are no Liens for any taxes upon the Assets of
Seller, except Liens for current taxes not yet due that are fully
reserved for on the Seller Financial Statements. All taxes that
Seller was or is required by law to withhold or collect, have been
and are being withheld or collected by it and have been or are
being held by it for such payment. All tax returns required to be
filed by or on behalf of Seller have been prepared and filed in
accordance with all applicable laws or requirements and accurately
reflect the taxable income (or other measure of Tax) of the party
filing the tax returns. All such tax returns, estimates, reports
and declarations are complete and accurate and disclose all taxes
required to be paid for the periods covered thereby. True and
complete copies of federal and state income or franchise tax
returns of Seller for each of the fiscal years ended May 31, 1994
and May 31, 1995 have been delivered to Purchaser. Except as
disclosed on Schedule 7.16, no audit, action, suit, investigation,
14
claim, assessment or examination with respect to taxes is now
pending or currently in progress with respect to Seller and, to the
best of Seller's knowledge, there is no basis therefor. Seller has
not received from the Internal Revenue Service or from any other
tax authority from any state, foreign, county, local, or other
jurisdiction a notice of underpayment of taxes, a proposed
assessment of taxes, proposed adjustment to any tax returned, filed
or other deficiency that it has not been paid.
7.17 No Misrepresentation or Material Non-disclosures.
Neither this Agreement nor the Related Agreements, nor any other
document, certificate or statement furnished to Purchaser in
connection herewith contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make
the statements contained herein or therein not misleading. There
is no fact known to Seller which materially adversely affects or in
the future may (so far as can now be foreseen) materially adversely
affect the Xxxx Business or the Assets which has not been set forth
in this Agreement.
7.18 Guaranteed Obligations. Seller has not directly or
indirectly guaranteed, become a surety or accommodation party for,
endorsed (other than collection or deposit in the ordinary course
of business), discounted with recourse, or agreed (contingently or
otherwise) to purchase or repurchase, or otherwise acquire any
indebtedness from any entity, nor agreed to supply or advance funds
to any person, firm, corporation or other entity, nor indemnified
any person, firm, corporation or other entity.
7.19 No Defective Products. The products of the Xxxx
Business previously manufactured and sold by Seller have, where
necessary, been qualified under and comply in all respects with the
specifications and requirements of applicable rating and compliance
agencies and safety standards. Except for express warranties
disclosed in Schedule 7.27, Seller retains the obligation to pay
for the satisfaction of any customer claims for deficiencies in its
products as more fully set forth in Article 5 of this Agreement.
7.20 Employee Benefit Plans
(a) Set forth in Schedule 7.20(a) is a true and
complete list of each "employee pension benefit plan" (as such term
is defined in Section 3(2) of the Employee Retirement Income
Security Act of 1974, as amended and the regulations promulgated
thereunder ("ERISA")) maintained by Seller or an ERISA Affiliate
(as defined in Section 7.20(e) below), or with respect to which
Seller or an ERISA Affiliate is or will be required to make any
payment, or which provides or will provide benefits to present or
prior employees of Seller or an ERISA Affiliate due to such
employment (the "Pension Plans"). Set forth in Schedule 7.20(a) is
a true and complete list of each "employee welfare benefit plan"
(as such term is defined in Section 3(1) of ERISA) maintained by
Seller, or with respect to which Seller is or will be required to
make any payment, or which provides or will provide benefits to
15
present or prior employees of Seller due to such employment (the
"Welfare Plans") (the Pension Plans and Welfare Plans together
being the "ERISA Benefit Plans"). Neither Seller nor any ERISA
Affiliate (i) maintains or has maintained, or (ii) is or was
required to make any payment with respect to, any "employee pension
benefit plan" (as such term is defined in Section 3(2) of ERISA)
ever subject to Section 302 of ERISA. No ERISA Benefit Plan or
prior Pension Plan is or was a "multi employer plan" (as such term
is defined in Section 3(37) of ERISA).
(b) Other than those plans and programs listed in
Schedule 7.20(a), Schedule 7.20(b) is a true and complete list of
each of the following to which Seller is a party or with respect to
which it is or will be required to make any payment (the "Non-ERISA
Commitments"):
(i) each retirement, savings, profit sharing,
deferred compensation, severance, stock ownership, stock purchase,
stock option, performance, bonus, incentive, vacation or holiday
pay, hospitalization or other medical, disability, life or other
insurance, or other welfare, benefit or fringe benefit plan,
policy, trust, understanding or arrangement of any kind, whether
written or oral; and
(ii) each employee collective bargaining agreement
and each agreement, understanding or arrangement of any kind,
whether written or oral, with or for the benefit of any present or
prior officer, director, employee or consultant (including, without
limitation, each employment, compensation, deferred compensation,
severance or consulting agreement or arrangement and any agreement
or arrangement associated with a change in ownership of Seller).
Seller has delivered to Buyer correct and complete copies of (i)
all written Non-ERISA Commitments and (ii) all insurance and
annuity policies and contracts and other documents relevant to any
Non-ERISA Commitment. Schedule 7.20(b) also contains a complete
and accurate description of all oral Non-ERISA Commitments.
(c) Seller has delivered to Buyer with respect to each
ERISA Benefit Plan correct and complete copies, where applicable,
of (A) all plan documents and amendments thereto, trust agreements
and amendments thereto and insurance and annuity contracts and
policies, (B) the current summary plan description, (C) the Annual
Reports (IRS Form 5500 series) and accompanying schedules, as
filed, for the most recently completed three plan years for which
such reports have been filed, (D) the financial statements for the
most recently completed three plan years for which such statements
have been prepared, (E) the most recent determination letter issued
by the Internal Revenue Service and the application submitted with
respect to such letter and (F) all correspondence with the Internal
Revenue Service, Department of Labor and Pension Benefit Guaranty
Corporation concerning any controversy.
16
(d) Each Pension Plan which is intended to qualify
under Section 401(a) of the Code is so qualified under the Code as
amended to the date hereof and no circumstance exists which might
cause such plan to cease being so qualified. With respect to each
ERISA Benefit Plan, (i) there is no pending or, to the best
knowledge of Seller, threatened claim, (ii) all contributions and
premiums due have been made on a timely basis and are deductible by
Seller, (iii) no "prohibited transaction" described in Section 406
of ERISA or Section 4975 of the Code has occurred, and (iv) Seller
has no potential liability under ERISA or the Code. Each of the
ERISA Benefit Plans (i) has been administered in accordance with
its terms and (ii) complies in form, and has been administered in
accordance, with the requirements of ERISA and, where applicable,
the Code. No liability has been asserted (whether or not such
liability is being litigated) against Seller or any affiliate of
Seller in connection with any employee pension benefit plan (as
defined in Section 3(2) of ERISA), including but not limited to,
any withdrawal liability (as described in Section 4201 of ERISA)
with respect to any multi employer plan (as defined in Section
3(37) of ERISA). There are no reserves, assets, surplus or prepaid
premiums with respect to any Welfare Plan. Seller and each ERISA
Affiliate has complied with the health care requirements of Part 6
of Title I of ERISA. Seller has no obligation to provide health or
death benefits to its prior employees or any other person other
than while an employee of Seller, except as specifically required
by Part 6 of Title I of ERISA. The consummation of the
transactions contemplated by this Agreement will not (i) entitle
any individual to severance pay, or (ii) accelerate the time of
payment, vesting or increase the amount of compensation due to any
such individual. Seller has not taken any action or failed to take
any action which will subject Seller or has subjected Seller to
liability under the Worker Adjustment and Retraining Notification
Act of 1988.
(e) For purposes of the Agreement, "ERISA Affiliate"
means (i) any corporation which at any time on or before the
Closing Date is or was a member of the same controlled group of
corporations (within the meaning of Section 414(b) of the Code) as
Seller; (ii) any partnership, trade or business (whether or not
incorporated) which at any time on or before the Closing Date is or
was under common control (within meaning of Section 414(c) of the
Code) with Seller; and (iii) any entity which at any time on or
before the Closing Date is or was a member of the same affiliated
service group (within the meaning of Section 414(m) of the Code) as
either Seller, any corporation described in clause (i) or any
partnership, trade or business described in clause (ii).
7.21 Employment Activity. To the best of Seller's
knowledge, Seller is in compliance with all applicable laws
respecting employment, employment practices, non-discrimination in
employment and employment practices, and terms and conditions of
employment and wages, and is not engaged in any unfair labor
practice. There is no employment discrimination or unfair labor
practice charge or complaint against Seller pending before the
17
National Labor Relations Board, the Equal Employment Opportunity
Commission or any other federal, state or local governmental agency
arising out of Seller's activities, and Seller has no knowledge of
any facts or information which would give rise thereto; there is no
labor strike or labor disturbance pending or threatened against
Seller nor is any grievance currently being asserted thereat; and
Seller has not experienced a work stoppage or other material labor
difficulties thereat except as set forth on Schedule 7.21 attached
hereto.
7.22 No Indebtedness. Seller does not have any outstanding
indebtedness to any person or entity, except for such indebtedness
as is set forth on Schedule 7.22 attached hereto and the lender(s)
of any such indebtedness has consented to the transfer of the
Assets to Purchaser hereunder free and clear of all Liens. For
purposes of the Agreement, "Indebtedness" shall mean all items
which in accordance with GAAP would be included in determining
total liabilities secured by any Lien on property owned or
acquired, whether or not such a liability shall have been assumed,
liabilities in respect of all leases, whether capitalized or
operating, and guarantees, indemnities, endorsements (other than
for collection in the ordinary course of business) and other
contingent obligations, whether secured or not in respect to the
obligations of other persons or entities.
7.23 Environmental Matters. Seller has all permits,
licenses, and other authorizations which are required as of the
date of this Agreement and the Closing Date for the operation of
the Xxxx Business under federal, state, local and foreign laws
relating to pollution and protection of the environment, including,
without limitation, the Resource Conservation and Recovery Act, 42
U.S.C. section 6901, et seq., as amended ("RCRA"), the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C.
section 9601, et seq., as amended ("CERCLA"), the Clean Air Act, 42 U.S.C.
section 7401, et seq., as amended ("CAA"), the Clean Water Act, 33 U.S.C.
section 1251, et seq. ("CWA"), the Toxic Substance Control Act, 15 U.S.C.
section 2601, et seq. ("TSCA"), and any other applicable federal, state or
local laws, statutes, ordinances and regulations relating to the
physical or environmental condition of property and to the
maintenance, record-keeping and disposition of any underground
tanks and relating to emissions, discharges, releases or threatened
releases, of pollutants, contaminants, petroleum oils, chemicals or
industrial, hazardous or toxic materials or waste into the
environment (including, without limitation, ambient water, surface
water, groundwater, land surface or subsurface strata) or otherwise
relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of pollutants,
contaminants, petroleum oils, chemicals or industrial, hazardous
toxic materials or waste or any regulation, order, decree or
judgment issued, entered, promulgated or approved thereunder (the
"Environmental Laws"). With respect to the conduct of its
business, its operations, its properties, and its use of owned and
leased properties, Seller is in compliance in all material respects
with all terms and conditions of the required permits, licenses and
18
authorizations necessary under the Environmental Laws, and is also
in compliance in all material respects with all other limitations,
restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules and timetables contained in the
Environmental Laws as in effect on the date hereof. There is no
pending civil or criminal litigation, notice of violation or
administrative proceeding arising out of the business or activities
of Seller and/or its shareholders or affiliates, including without
limitation any pending litigation, notice or proceeding relating in
any way to the Environmental Laws (including notices, demands,
letters or claims under RCRA, CERCLA, CAA, CWA, TSCA and similar
foreign, state and local laws. There is no threatened civil or
criminal litigation, notice of violation or administrative action
arising out of the business activities of Seller, including without
limitation, any threatened litigation, notice or proceeding
relating in any way to the Environmental Laws. Except as disclosed
on Schedule 7.23, Seller is not aware of any past or present
events, conditions, circumstances, practices, incidents or actions
which may give rise to any legal liability, or otherwise form the
basis of any claim, action, suit, proceeding, hearing or
investigation against or involving Seller arising out of any
violation or alleged violation of the Environmental Laws or any
circumstances which could reasonably be expected to interfere with
or prevent continued compliance with the Environmental Laws in
effect on the date hereof or the Closing Date. To the best of
Seller's and Met-Coil's knowledge, no hazardous substances,
pollutants, petroleum oils or fraction, contaminants or hazardous
waste including, but not limited to, asbestos, "PCB's" and urea
formaldehyde are contained in or have been, from any source
whatsoever, generated, released, spilled, stored or deposited over,
beneath or on the Dallas facility of Seller, or on adjoining
properties, by Seller, or, to the best of Seller's knowledge, any
other person, EXCEPT only such substances as have been fully
disclosed to Purchaser on Schedule 7.23 attached hereto.
7.24 Approvals and Consents. Except as set forth on Schedule
7.24, no consent, authorization or approval of, or waiver or
exemption by, or filing with any other person or entity is required
in connection with the execution, delivery or performance of this
Agreement by Seller or Met-Coil or the consummation by Seller of
the transactions contemplated hereby.
7.25 Insurance. Attached hereto on Schedule 7.25 is a
complete and correct list of all policies of insurance of which
Seller is the owner, insured or beneficiary, or covering the Xxxx
Business or any of the Assets for any policy period after June 1,
1992. Such Schedule indicates for each policy the carrier, names
of all insured parties thereunder (including the named insured and
additional insured parties, if any), risks insured, the amounts of
coverage, deductibles and retentions, if any and any pending claims
thereunder. Except as set forth on Schedule 7.25, all premiums
under such policies for periods through the date hereof have been
paid and through the Closing Date will be paid. No notice of
cancellation or non-renewal with respect to or disallowance of any
19
claim under, or increase of the premium for any such insurance
policy has been received by Seller.
7.26 Other Intangibles. The vendor and customer lists of
Seller related to the Xxxx Business attached hereto on Schedule
7.26 are true and complete as of the Closing Date; and the
engineering drawings, bills of material, manufacturing data,
software and data collection services and other intangibles
conveyed to Purchaser as described in Section 1.1.6 are all of such
items used in the Xxxx Business that are in the possession of
Seller. Except as set forth on Schedule 7.26, there exists no
actual or, to the knowledge of Seller, threatened termination,
cancellation or material limitation of, or material modification
in, the business relationship of Seller with any customer or
supplier.
7.27 Warranties. Set forth on Schedule 7.27 are the express
warranty terms and disclaimers for all forms of warranties given
(or extended warranties sold) by Seller during the ten-year period
prior to the Closing Date with respect to the Xxxx Business for
product sold or services related thereto performed by Seller.
Under the Xxxx name, Seller, in operating the Xxxx Business, has
not sold any parts or equipment or performed any services related
thereto which fail to comply with any express or implied warranties
or guarantees of Seller applicable to such parts or equipment or
services related thereto.
8. Representations and Warranties of Purchaser
Purchaser represents and warrants to Seller as of the Closing
Date as follows:
8.1 Corporate Existence. Purchaser is a limited partnership
duly formed, validly organized and existing in good standing under
the laws of the State of Texas. Purchaser has full power and
authority to own its assets and to carry on its business as and
where such business is now conducted.
8.2 Due Authorization and Enforceability. Purchaser has
full power and authority to execute and deliver this Agreement and
the Related Agreements to which it is a party, and to consummate
the transactions contemplated hereby and thereby. The execution
and delivery of this Agreement and the Related Agreements to which
it is a party, by Purchaser of the transactions contemplated hereby
and thereby have been duly authorized by all necessary action and
no other action or proceeding on the part of Purchaser is necessary
to authorize the execution and delivery by Purchaser of this
Agreement or Related Agreements to which it is a party or the
consummation by Purchaser of the transactions contemplated hereby
or thereby. This Agreement and the Related Agreements to which
Purchaser is a party have been duly executed and delivered by
Purchaser and this Agreement and the Related Agreements to which
Purchaser is a party are legal, valid and binding obligations of
Purchaser, enforceable against Purchaser in accordance with their
stated terms.
20
8.3 No Conflicts. Neither the execution and delivery of
this Agreement or the Related Agreements to which Purchaser is a
party, nor the consummation of the transactions contemplated hereby
or thereby will (i) conflict with or violate any provision of the
Partnership Agreement or other formation documents of Purchaser,
(ii) conflict with or violate any law, rule, regulation, ordinance,
order, writ, injunction, judgment or decree applicable to Purchaser
or by which any of its properties or assets are bound or affected
or (iii) conflict with or result in any breach of or constitute a
default (or an event which with notice or lapse of time or both
would become a default) under, or give to others any rights or
termination or cancellation of, or result in the creation of any
lien, charge or encumbrance on any of their assets or properties
pursuant to any of the terms, conditions, or provisions of, any
note, bond, mortgage, indenture, permit, license, franchise
agreement, lease, contract, or other instrument or obligation to
which Purchaser is a party or by which any of Purchaser's
properties or assets are bound or affected; except, in the case of
(ii) and (iii) above, for such conflicts, violations, breaches,
defaults, terminations, cancellations and accelerations which in
the aggregate will not have a material adverse effect on the
ability of Purchaser to consummate the transactions contemplated by
this Agreement and the Related Agreements to which it is a party.
9. Survival of Representations and Warranties. The
representations and warranties made in this Agreement or pursuant
hereto shall survive the execution and delivery of this Agreement
and the conclusion and closing of the transactions contemplated
hereby.
10. Covenants
10.1 Retention of Records. Purchaser hereby covenants that
for a period of seven (7) years following the Closing Date,
Purchaser will retain, at Purchaser's sole expense, the Books and
Records of Seller relating to the operation of the Xxxx Business
prior to the Closing Date. During such period, Purchaser will
afford to Seller, its counsel and accountants, during normal
business hours, reasonable access to such books, records and other
data, to the extent that such access may reasonably be required to
facilitate the preparation by Seller of such tax returns as they
may be required to file with respect to Seller and the
investigation, litigation and final disposition of any claims which
may be made against Seller. Following the expiration of such seven
(7) year period, Purchaser may dispose of any such books, records
and other data; provided, however, that before disposing of any
such materials it will first notify Seller and permit Seller at its
sole expense, to remove such materials.
10.2 Further Actions. Upon the terms and subject to the
conditions hereof, each of the parties hereto agrees to use its
best efforts or take or cause to be taken all action and to do or
21
cause to be done all things necessary, proper and advisable to
consummate the transactions contemplated by this Agreement, the
Related Agreements and other documents necessary to close this
transaction, and shall use its best efforts to obtain all necessary
waivers, consents and approvals and to effect all necessary
registrations and filings. In addition, Seller covenants and
agrees that it will take all actions and execute and deliver all
documents, instruments, and agreements necessary to assist
Purchaser in the removal of all Liens whether set forth in Schedule
7.7 or not, after Purchaser has satisfied its obligations (pursuant
to its assumption of Seller's liabilities) for the underlying
indebtedness of such Liens.
10.3 Press Releases. Purchaser and Seller will consult with
each other before issuing any press release or otherwise making any
public statements with respect to this Agreement or the
transactions contemplated hereby and shall not issue any such press
release or make any such public statement prior to such
consultation, except as may be required by law or any listing
agreement with a national securities exchange. Notwithstanding the
foregoing, Seller shall, simultaneously with the Closing, notify
its employees and creditors of the sale of assets contemplated by
this Agreement, specifically noting that Purchaser is not assuming
liabilities beyond those described in this Agreement.
10.4 Lease Agreement. Purchaser and Seller shall enter into
a lease for the occupation and use by Purchaser of the Dallas
facility, including the manufacturing office and building,
machinery and equipment and tooling, of Seller, substantially in
the form of Exhibit 10.4 attached hereto (the "Lease Agreement")
which Lease Agreement shall be effective on the Closing Date.
10.5 Receipt of Funds. After the Closing Date, each of
Purchaser and Seller shall segregate any monies or other amounts
paid to either of them in respect of receivables or assets that
belong to the other party whether received in a lock-box account or
otherwise, and each party shall pay over and remit to the other
party any such monies and amounts weekly after receipt thereof.
Each of Purchaser and Seller shall take all reasonable actions,
including the giving of timely notices to assure that the covenants
set forth in this Section 10.5 are faithfully and timely fulfilled.
10.6 Xxxx Employees.
10.6.1 Potential Employees. Effective as of the
Closing Date, Purchaser or an agent or affiliate of Purchaser may
offer employment to any of Seller's personnel now working at the
Dallas facility of Seller (a "Potential Employee"), except those
employees whom Seller intends to retain as set forth on Exhibit
10.6.1 ("Retained Employees"). Any Potential Employee who accepts
any such offer of employment and who commences employment upon the
terms of such offer on or after the Closing Date is an "Accepting
Employee". Seller shall be responsible and liable for any required
22
notification and payments under the Worker Adjustment and
Retraining Notification Act of 1988.
10.6.2 Separation Benefits. Purchaser will not assume
or have any liability, responsibility or obligation under any of
the Pension Plans, Welfare Plans or Non-ERISA Commitments of Seller
or Met-Coil. Seller will be responsible and liable for and
discharge at or prior to Closing all obligations to, for or on
behalf of all Retained Employees and Potential Employees under any
Pension Plans, Welfare Plans and Non-ERISA Commitments, including,
without limitation, the cost of accrued and unpaid wages, unpaid
bonuses, stock options, severance pay, accrued vacation pay, pay
for personal days, holidays, and sick leave, the cost of retirement
benefits and pensions, the cost of payroll taxes, including FICA,
Federal Unemployment Insurance, State Unemployment Insurance and
Federal and State withholding, and the cost of health insurance,
dental insurance, disability insurance, life insurance and the
like. Seller also will be responsible and liable for the costs of
administration and compliance with COBRA (as defined in Section
10.6.5 of this Agreement) or similar group health contribution
coverage benefits under federal and state law, and the costs of
liability and defense of claims related to the wrongful or
discriminatory termination of employment for Accepting Employees
who do not remain as employees of Purchaser after the termination
of the Lease Agreement or voluntarily leave the employ of Purchaser
prior thereto (collectively such costs and those set forth in the
sentence prior hereto shall be defined as "Separation Benefits").
10.6.3 Eligibility of Accepting Employees. For
purposes of eligibility for employment plans, programs and for
vacation during employment with Purchaser, Purchaser's policies or
those of its affiliates as set forth from time to time hereafter
shall be applied in accordance with their terms and conditions to
all Accepting Employees. The service of Accepting Employees with
Seller prior to the Closing Date shall be recognized for purposes
of eligibility for vacation accrued in accordance with and subject
to the terms and conditions of Purchaser's or its affiliates'
applicable vacation policies as stated from time to time.
10.6.4 Claims of Accepting Employees. Seller hereby
agrees to indemnify and hold harmless Purchaser, its agents,
officers or directors, employees, and affiliates against any
liabilities, costs or expenses (including reasonable attorneys'
fees) resulting from claims made by any Retained Employees or
Potential Employees for Separation Benefits. Subject to the
accuracy of the representations of Seller contained herein,
Purchaser hereby agrees to indemnify Seller, its agents, officers,
directors, employees and subsidiaries against any liabilities,
costs or expenses including reasonable attorney's fees) resulting
from claims made by any Accepting Employees relating to acts and
omissions of Purchaser with respect to the employment of such
Accepting Employees by Purchaser after the Closing Date.
23
10.6.5 Health Benefits. With respect to any Accepting
Employees of Seller who do not remain as employees of Purchaser
after the termination of the Lease Agreement, Seller shall promptly
reimburse Purchaser for the cost of administration of group health
continuation coverage required under the Consolidated Omnibus
Budget Reconciliation Act of 1985 ("COBRA") for any qualifying event
or as required under applicable state law.
10.7 Discharge of Liabilities. Seller will pay and discharge
in due course after the Closing Date, and hold Purchaser harmless
from, all liabilities and obligations of Seller relating to and
arising from the ownership and operation of the Assets and the Xxxx
Business prior to the Closing Date, (whether unrecorded accounts
payable, accrued liabilities, customer deposits or other
obligations), it being understood that Purchaser is assuming no
liabilities or obligations of Seller other than those expressly set
forth in Article 5 of this Agreement. If Seller fails to pay and
discharge any such liabilities and, in the case of bona fide
disputes regarding such liabilities, fails to disclose to Purchaser
the existence of and all facts relating to such bona fide disputes,
Purchaser may, without having any duty, pay or discharge such
liabilities of Seller and offset such amounts paid from the
Adjustable Note as set forth in Section 3.3(a) of this Agreement or
use the indemnification provisions of Article 16 of this Agreement.
11. Closing
11.1 Closing. The closing of the transaction contemplated by
this Agreement (the "Closing") shall be held on the 31st day of
January, 1996 or such other date as mutually agreed by the parties,
at the offices of _________________________________
in______________________________ at _______ __.m., local time, or
at such other time and place as the parties may agree.
11.2 Closing Events. At the Closing upon the Closing
Date:
11.2.1 Purchaser shall deliver to Seller the Initial
Note and the Adjustable Note.
11.2.2 Seller shall execute and deliver to Purchaser the Xxxx of Sale.
11.2.3 Seller shall provide to Purchaser any and all required
written consents to assumption of the Material Agreements.
11.2.4 Purchaser shall execute and deliver to Seller the Certificate of
Assumption, in the form attached hereto as Exhibit 11.2.4 for those liabilities
of Seller assumed by Purchaser pursuant to Section 5.1 of this Agreement.
11.2.5 Purchaser shall have received a written legal opinion from counsel
to Seller substantially in the form attached hereto as Exhibit 11.2.5.
24
11.2.6 Seller shall have received from the Chief Executive officer and the
Chief Financial Officer of Purchaser and Purchaser shall have received from the
Chief Executive Officer and the Chief Financial Officer of Seller, a certificate
that, as to such party, the representations and warranties made by such party
are true as of the Closing Date, and that all covenants to be performed by such
parties have been performed.
11.2.7 The parties shall complete and execute the Memorandum of Allocation.
11.2.8 Seller shall have received from the Secretary of Purchaser and
Purchaser shall have received from the Secretaries of each of Seller and of
Met-Coil a certificate setting forth, as to such party, the corporate
resolutions or partnership actions authorizing and approving the execution,
delivery and performance of the Agreement and the other documents to be executed
by that party in connection herewith, and a good standing certificate or similar
document from the applicable Secretary of State of each party's state of
incorporation or formation.
11.2.9 Purchaser shall have received from the counsel of Seller (a) a copy
of a UCC search of the Texas central file for all filings of financing
statements under Seller's and Met-Coil's name, and (b) a copy of a tax lien,
suit and judgment search of the records of any county where the real or personal
property of Seller is located.
11.2.10 Seller and Purchaser shall execute and deliver the Lease Agreement
in the form set forth in Exhibit 10.4 of the Agreement.
11.2.11 Met-Coil shall execute and deliver the Guarantee in the form set
forth in Exhibit 16.6 of this Agreement.
11.2.12 Seller and Met-Coil shall execute and deliver the Non-Competition
Agreement in the form set forth in Exhibit 6.2 of this Agreement.
11.2.13 Seller and Met-Coil shall obtain from its secured and judgment
creditors and lenders and deliver to Purchaser such lien releases, terminations
and other documents necessary to assure Purchaser to its satisfaction that the
Assets are being transferred by Seller to Purchaser under this Agreement free
and clear of all liens and encumbrances.
12. Conditions to Purchaser's Obligation to Complete Closing
The obligation of Purchaser to purchase and pay for the Assets
at Closing shall be subject to the satisfaction, prior to or
concurrently with the Closing Date, of each of the following
express conditions precedent, unless waived by Purchaser:
25
12.1 Consents and Releases. Seller shall have obtained and
delivered to Purchaser (based upon Purchaser's assumption thereof)
any and all required consents to the assignment of the Material
Agreements and the lien and judgment releases and terminations of
security interests described in Section 11.2.13 of this Agreement
so that the Assets may be transferred by Seller to Purchaser free
and clear of all liens and encumbrances.
12.2 Governmental Approvals. Purchaser and Seller shall have
obtained all requisite government approvals, if any, for their
participation in the transactions contemplated under this
Agreement.
12.3 Accuracy of Representations. The representations and
warranties of Seller shall be true and correct in all material
respects at the Closing Date, and Seller shall have complied with
all covenants set forth in this Agreement.
12.4 Closing Documents Delivered. Seller shall have executed
and delivered the documents, certificates, instruments and
agreements and done the acts required of Seller in connection with
the Closing as described in Section 11.
12.5 No Prohibition. No order, statute, rule, regulation,
executive order, injunction, stay, decree or restraining order
shall have been enacted, entered, promulgated or enforced by any
court or competent jurisdiction or governmental or regulatory
authority or instrumentality that prohibits the consummation of the
transactions contemplated hereby.
12.6 Bankruptcy. Neither Seller or Met-Coil shall be the
subject of a petition for reorganization or liquidation under the
Federal bankruptcy laws, or under state insolvency laws, nor shall
an assignment for the benefit of creditors or any similar
protective proceeding or act or event of bankruptcy have occurred.
12.7 Non-Fulfillment Date. In the event that one or more of
the foregoing conditions in this Section 12 is not fulfilled by the
date of March 15, 1996, Purchaser may, upon notice to Seller or
Met-Coil, on or prior to Closing, elect either (i) to waive the
condition and proceed to Closing; or (ii) terminate this Agreement
without any further liability on the part of either of the parties
except that the foregoing shall not relieve either of the parties
from liability for damages actually incurred as a result of breach
of this Agreement.
13. Conditions to Seller's obligation to Complete the Closing
The obligation of Seller to sell and convey the Assets at the
Closing shall be subject to the satisfaction, prior to or
concurrently with the Closing Date, of each of the following
express conditions precedent:
26
13.1 Government Approvals. Purchaser and Seller have
obtained all requisite government approvals, if any, for their
participation in transactions contemplated under this Agreement.
13.2 Accuracy of Representations. The representations and
warranties of Purchaser shall be true and correct in all material
respects at the Closing Date, and for Purchaser shall have complied
with all of its covenants set forth in this Agreement.
13.3 Closing Documents Delivered. Purchaser shall have
executed and delivered the documents, certificates, instruments and
agreements and done the acts required of Purchaser in connection
with the Closing, as described in Section 11.
13.4 No Prohibition. No order, statute, rule, regulation,
executive order, injunction, stay, decree or restraining order,
shall have been enacted, entered, promulgated or enforced by any
court or competent jurisdiction or governmental or regulatory
authority or instrumentality that prohibits the consummation of the
transactions contemplated hereby.
14. Post-Closing Covenants
14.1 Bulk Sale. Seller hereby agrees to indemnify and save
and hold harmless Purchaser, its shareholders, directors and
officers from and against any and all claims, losses, damages,
costs or expenses of any kind or character, including attorneys'
fees, other than those expressly assumed by Purchaser, arising out
of or resulting from failure to comply with the "Uniform Commercial
Code -- Bulk Transfers" of the State of Texas or of such other
state as to which such act or equivalent act applies or may apply
to the transactions contemplated by this Agreement.
14.2 Further Accrued Liabilities. In the event that
liabilities of Seller related to the Xxxx Business not disclosed in
this Agreement shall be discovered after the Closing Date,
Purchaser may demand in writing and Seller shall promptly satisfy
such liability and provide evidence thereof to Purchaser; and if
such demand is not satisfied in full by Seller, or Seller, in the
case of a bona fide dispute regarding the liability, is not
defending the dispute, Purchaser may, but is not required to,
assume or discharge such liability and (a) offset such amount
against any obligations of Purchaser to Seller, (b) make a demand
in writing to Seller for reimbursement and Seller shall promptly
reimburse Purchaser, or (c) seek redress under the indemnification
procedure set forth in Article 16 of this Agreement.
15. Amendment and Waiver
15.1 Amendment. This Agreement may be amended only by a
writing executed by the authorized representatives of Purchaser and
Seller.
27
15.2 Waiver. Any party hereto may (a) agree to extend the
time for the performance of any of the obligations or other acts of
the other parties hereto, (b) waive any inaccuracies in the
representations and warranties contained herein or in any document
delivered pursuant hereto or (c) waive compliance with any of the
agreements or conditions contained herein. Any agreement on the
part of the party hereto to any such extension or waiver shall be
valid only if set forth in an instrument in writing signed by the
authorized representative of such party.
16. Indemnification
16.1 Purchaser Indemnification. For a period of thirty-six
(36) months following the Closing Date, Purchaser hereby agrees to
indemnify and hold Seller harmless, from and against any and all
loss, liability (whether known or unknown, actual or contingent,
legal or equitable, mature or inchoate, as guarantor or principal
obligor, howsoever arising), claim, damage and expense, including,
but not limited to, reasonable attorneys, fees and amounts
reasonably expended in settlement of litigation, pending or
threatened, after the date hereof, incurred after the Closing Date
and arising out of or relating to: (i) any liabilities or
obligations of the Xxxx Business which were expressly assumed by
Purchaser under this Agreement; (ii) any material misrepresentation
or material breach of any of Purchaser's representations and
warranties set forth in this Agreement; or (iii) any material
breach of any of Purchaser's covenants or obligations under this
Agreement.
16.2 Seller and Met-Coil Indemnification
16.2.1 For a period of thirty-six (36) months following the Closing Date,
Seller hereby agrees to indemnify and hold Purchaser harmless from and against
any and all loss, liability (whether known or unknown, actual or contingent,
legal or equitable, mature or inchoate, howsoever arising), damage and expense,
including but not limited to reasonable attorneys' fees and amounts reasonably
expended in settlement of litigation, pending or threatened, incurred after the
Closing Date and arising out of or relating to: (i) any liabilities and
obligations of Seller not expressly assumed by Purchaser under the Agreement;
(ii) any material misrepresentation or material breach of any of Seller's
representations and warranties set forth in this Agreement; (iii) any material
breach of any of Seller's covenants or obligations under this Agreement; (iv)
any liabilities and obligations of Seller related to the operation of its other
businesses including Fen-Pro; and (v) any material breach of any of Seller's
covenants under the Lease Agreement and the Non-Competition Agreement.
16.2.2 For a period of thirty-six (36) months following the Closing Date,
Met-Coil hereby agrees to indemnify and hold Purchaser harmless from and against
any and all loss, liability (whether known or unknown, actual or contingent,
legal or equitable,
28
mature or inchoate, howsoever arising), damage and expense, including
but not limited to reasonable attorneys' fees and amounts reasonably
expended in settlement of litigation, pending or threatened, incurred
after the Closing Date and arising out of or relating to: (i) any
material misrepresentation or material breach of any of Met-Coil's
representations and warranties set forth in the Agreement; and (ii)
any material breach of any of Met-Coil's covenants or obligations
under this Agreement, the Guarantee and the Non-Competition
Agreement.
16.3 Procedure of Indemnification
16.3.1 Neither Purchaser nor Seller nor Met-Coil are
required to take any action or make any claim to any third person as
a precondition of seeking indemnification from the other(s)
hereunder. The party seeking indemnification (the "Claimant") shall
promptly give notice to the indemnifying party or parties of any
matter or item which forms a basis for indemnification hereunder (a
"Claim"). The Claimant shall afford the indemnifying party or
parties, or their authorized representatives, the opportunity to
defend, discharge or compromise such Claim and examine the books and
records of the Claimant insofar as they relate to such Claim and to
copy or make extracts therefrom, and will (at the expense of the
indemnifying party) provide full cooperation of itself and its
employees and agents with respect to such Claim. At an indemnifying
party's request and expense, the Claimant will assign any claims or
rights which the Claimant may have against any third party in an
action against the third parties, and, at the indemnifying party's
expense, the Claimant will cooperate fully with the indemnifying
party in pursuing any such claim or right.
16.3.2 The indemnifying party or parties may, within twenty (20) days after
the Claimant has given notice of the Claim, give notice to the Claimant that the
indemnifying party or parties intend to litigate or otherwise attempt to resolve
the claim identified in the Claimant's notice. Upon such notice from the
indemnifying party or parties to the Claimant: (1) the indemnifying party or
parties, or any of them, shall have the right, at their sole cost and expense
and without liability, cost or expense, to Claimant, to prosecute any such
proceeding, defend any such Claim or otherwise attempt to resolve the Claim
(including, but not limited to, settling such claim by paying all amounts in
settlement), and (ii) Claimant shall have the right to participate at its
expense in the defense of any such Claim. The indemnifying party or parties
shall keep the Claimant appraised of all material developments in connection
with any such Claim.
16.3.3. So long as any indemnifying party shall continue to handle a Claim
or proceeding in good faith, or until a final determination that monies are
payable by Claimant to a third person, the indemnifying party or parties will
not be obligated to pay to Claimant the monies so claimed.
29
16.3.4 Notwithstanding the foregoing Section 16.3.3; if as a result of any
Claim, a judgment is entered against Claimant in a court of competent
jurisdiction, or a lien attaches to any property or asset of Claimant, or any
injunction, order or decree is obtained in any court of competent jurisdiction
which materially and adversely affects or threatens to materially affect the
assets, property, business or operations of Claimant, Claimant will be entitled
to discharge, compromise or settle such Claim in good faith without the consent
of the indemnifying party or parties.
16.3.5 All amounts incurred or paid by the Claimant for which it is
entitled to indemnification by the indemnifying party or parties pursuant to the
terms and conditions of this Agreement shall be promptly reimbursed to it by the
indemnifying party or parties if not reimbursed within thirty (30) days of
written request therefor, Claimant shall have the right to offset from any other
amounts it owes or may owe to the indemnifying party or parties. In the event
Claimant collects or retains an amount in excess of the amount of claim or lien,
including reasonable costs and expenses including attorneys fees, Claimant shall
return such funds to the indemnifying party. Claimant shall cooperate in
accordance with its best business judgment, in attempting to cause third parties
who are liable to it or to the indemnifying party, to cause such third parties
to reimburse the indemnifying party for payment made by it to Claimant; and
Claimant shall subrogate the indemnifying party to Claimant's rights against
third parties, with respect to claims paid by the indemnifying party to
Claimant.
16.4 Exclusive Remedy. So long as the indemnifying party is in
compliance with this Article 16, the remedies provided in this
Article 16 shall be exclusive, except for (a) remedies set forth
elsewhere in this Agreement and (b) specific performance or
injunctive relief which shall be available regardless of the
provisions of this Article 16 so long as claims for specific
performance or injunctive relief are made within thirty six (36)
months of the Closing Date.
16.5 Limitation on Scope of Time Limitations. Notwithstanding
the foregoing, the time limitation set forth in Sections 16.1, 16.2.1
and 16.2.2 of this Agreement, shall not apply to claims of fraud or
actions to enforce Article 6, Sections 7.2, 7.7, 7.16, 8.2, 10.1,
16.6 and Article 19 of this Agreement.
16.6 Met-Coil Guarantee. In consideration of the execution of
this Agreement by Purchaser, and the benefit that flows therefrom to
Met-Coil as the sole shareholder of Seller, as well as for other
considerations, Met-Coil shall guarantee the obligations of Seller
under this Agreement by the execution and delivery of a guarantee
substantially in the form attached hereto as Exhibit 16.6 (the
"Guarantee") and such Guarantee shall survive the dissolution or
liquidation of Seller and shall survive any statute of limitations
applicable to Seller.
30
17. Notices
Any notices or other communications required or permitted
hereunder or otherwise in connection herewith shall be in writing and
shall be deemed to have been duly given when delivered in person or
transmitted by facsimile transmission or on receipt after dispatch by
express, registered or certified mail, postage prepaid, addressed as
follows:
If to Seller:
Xxxx Machinery & Automation, Inc.
c/o Met-Coil Systems Corporation
0000 0xx Xxxxxx, X.X.
Xxxxx Xxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxx
cc: Xxxxxxx X. Xxxxxxxx
Xxxxxxxxxxxx & Ingersoll, P.C.
000 Xxxxxxx Xxxxxxxx
X.X. Xxx 0000
Xxxxx Xxxxxx, XX 00000-0000
If to Purchaser:
Mestex, Ltd.
c/o Mestek, Inc.
000 Xxxxx Xxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: R. Xxxxx Xxxxx
Senior Vice President
and General Counsel
or such other address as the person to whom notice is to be given has
furnished in writing to the other parties.
18. Further Assurance -- After Closing
18.1 Assurance of Seller and Met-Coil. At any time and from
time to time after the Closing Date, at Purchaser's request and
without further consideration, Seller and Met-Coil shall cooperate in
good faith and promptly execute and deliver all such further
instruments or documents and perform such other and further acts as
Purchaser may reasonably request is in order to fully conclude the
transactions contemplated hereby.
18.2 Delivery of Notices. After the Closing Date, Seller and
Met-Coil shall promptly deliver to Purchaser any notices,
correspondence and other documents relating to the Assets being
conveyed hereunder and the Xxxx Business, which are, from time to
time, received by Seller and/or Met-Coil.
31
19. Confidentiality
19.1 Proprietary information. Purchaser acknowledges its
receipt of substantial information from Seller concerning the Xxxx
Business. All such information is hereinafter called the
"Proprietary Information".
19.2 Nondisclosure. Seller and Met-Coil acknowledge that they
are now in possession of the same Proprietary Information concerning
the Xxxx Business as described above in Section 19.1. Seller and
Met-Coil agree to keep all of the Proprietary Information
confidential after the Closing Date, except such Proprietary
Information that becomes public information without the fault of
Seller or Met-Coil.
20. Entire Agreement -- Binding Effect. This Agreement (together
with the Exhibits and Schedules hereto, and the other agreements
executed at the Closing) sets forth the entire integrated
understanding and agreement of the parties with respect to the
subject matter hereof and supersedes all prior agreements whether
written or verbal. This Agreement may not be modified, amended or
terminated except in a writing signed by all of the parties hereto.
21. Assignment. No party to this Agreement shall have the right to
assign any of its rights and obligations hereunder without the prior
written consent of the other parties hereto. To the extent that such
consent is given, this Agreement and all provisions hereof shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.
22. Miscellaneous
22.1 Expenses. Except as otherwise agreed herein, each
party hereto shall bear its own expenses incurred in connection with
this Agreement and the consummation of the transactions contemplated
hereby.
22.2 Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed to be an original
instrument, but all such counterparts together shall constitute one
and the same instrument.
22.3 Governing Law. This Agreement is being made in and
shall be governed by and construed and enforced in accordance with
the laws of the State of Texas and the United States of America,
except for the conflicts laws of those jurisdictions.
22.4 No Third Party Rights. This Agreement, the Related
Agreements and the other agreements entered into at the Closing are
solely for the benefit of the parties hereto. No third person shall
acquire any rights or claims by reason of or under this Agreement,
the Related Agreements or the other agreements entered into at the
Closing.
32
22.5 Severability. Should any terms, provision or clause
hereof, or of any other agreement or document which is required by
this Agreement, be held to be invalid, such invalidity shall not
affect or render invalid any other provisions or clauses hereof or
thereof the consideration or mutuality of which can be given effect
without such invalid provision, and all of which shall remain in
full force and effect. If any provision of this Agreement is so
broad as to be unenforceable, such provision shall be interpreted to
be only so broad as is enforceable under applicable law.
22.6 Headings. The headings to the sections of this Agreement
are inserted for convenience and reference only and are not intended
to define or limit the substance of any section.
22.7 Singular and Plural. Singular terms in this Agreement
may be deemed to include plural, and plural terms to include the
singular.
22.8 No Brokerage Fees. Neither Seller nor Purchaser, nor any
of their officers, directors or employees, nor Met-Coil, has incurred
any liability for any brokerage fees, commissions, finders, fees or
similar fees or expenses for which either Seller, Purchaser or Met-
Coil may be liable.
22.9 Exhibits and Schedules. The exhibits and schedules
referenced in this Agreement and attached hereto shall be deemed to
be a part of this Agreement and are incorporated herein by this
reference.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement under seal, with the intent that this be a sealed
instrument, on the date first above written.
SELLER: XXXX MACHINERY & AUTOMATION, INC.
CORPORATE SEAL
ATTEST:
BY: /s/ By:_/s/_____________________
Xxxxxxx Xxxxxxxx Xxxxxxx X. Xxxxxxxx, Chairman
PURCHASER: MESTEX, LTD.,
CORPORATE SEAL A Texas limited partnership
ATTEST:
By: GENTEX PARTNERS, INC.
By: /s/ Its General Partner
R. Xxxxx Xxxxx
By: /s/
Xxxxxxx X. Xxxx, Senior
Vice President-Finance
CORPORATE SEAL MET-COIL SYSTEMS CORPORATION
ATTEST:
By: /s/ By: /s/
Xxxxxx Xxxxxxxx Xxxxxxx X. Xxxxxxxx, Chairman
33
