Exhibit 2.3
ASSET PURCHASE AGREEMENT
THIS AGREEMENT is made this 31st day of March, 2000, by and
among NDC, INC., a Wisconsin corporation (being referred to
hereinafter as "Seller"); MEGA MARTS, INC., a Wisconsin
corporation (being referred to hereinafter as "Buyer"); and
XXXXXX'X, INC., a Wisconsin corporation (being referred to
hereinafter as "Xxxxxx'x");
RECITALS:
WHEREAS, Seller owns and operates a grocery supermarket at
0000 Xxxxx 00xx Xxxxxx, Xxx Xxxxx, Xxxxxxxxx, 00000 (being
hereinafter referred to as the "Store" and the business conducted
in the Store being hereinafter referred to as the "Business");
WHEREAS, pursuant to a Stock Purchase Agreement dated March
31, 2000, by and among Xxxxxx'x and the stockholders (the "Mega
Shareholders") of Buyer (the "Stock Purchase Agreement") Xxxxxx'x
will purchase 100% of the outstanding stock of Buyer from the
Mega Shareholders resulting in Buyer becoming a wholly-owned
subsidiary of Xxxxxx'x, and Xxxxxx'x is therefore willing to join
with Buyer as a party to this Agreement and guaranty the
obligations of Buyer hereunder;
WHEREAS, Seller desires to sell and Xxxxxx'x desires to
cause Buyer to purchase the Business and substantially all of
Seller's assets used in the conduct of the Business at the Store
upon the terms and conditions set forth in this Agreement; and
WHEREAS, at the Closing, Seller intends to transfer this
Agreement and substantially all of its other assets (except the
tangible and intangible assets of the Tri City True Value
Hardware Store and vehicles) to a newly-formed limited liability
company (the "Seller's LLC"), and thereafter to liquidate and
dissolve, transferring ownership of the Seller's LLC to the
shareholders of Seller ("NDC Shareholders"); Seller has requested
that the NDC Shareholders not be made parties to this Agreement,
and Xxxxxx'x and Buyer are willing to accede to that request and
to permit Seller to liquidate and transfer its assets and this
Agreement to the Seller's LLC only on the condition that the
Seller's LLC assume all of the obligations and liabilities of NDC
under this Agreement, agree to be bound thereby, and agree to the
other terms and provisions of this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein, the parties hereto agree as follows:
AGREEMENT:
1. SALE OF ASSETS.
(a) Assets Sold. On the Closing Date (as hereinafter
defined), subject to the terms and conditions set forth in this
Agreement, Seller shall sell, convey, transfer, assign and
deliver to Buyer and Buyer shall purchase only the following
designated assets of Seller (collectively the "Purchased
Assets"):
(i) Inventory. All inventory, including video
tapes, owned by Seller and held for sale (or rental) in the
ordinary course of business at the Store as of the Effective
Time (as hereinafter defined), to the extent such inventory
is usable, saleable, and not outdated or damaged (the
"Inventory");
(ii) Store Cash and Other Current Assets. All
operating cash on hand and located in the Store as of the
Effective Time, together with the following other current
assets (the "Cash on Hand"):
A. all food stamps;
B. deposits in transit to the bank accounts of Buyer;
C. vouchers representing receivables from customers;
D. Coinstar vouchers;
E. unsold gift certificates and gift certificate
receivables;
F. debit and credit card receivables;
G. notes receivable from two employees that are being
repaid through payroll deductions;
H. unsold lottery tickets;
I. bus passes; and
J. vendor rebates receivable.
(iii) Trademarks, Trade Names and Other
Intellectual Property. All intellectual property associated
with the Business (including but not limited to all
trademarks, service marks, trade names, pending trademark,
service xxxx and trade name applications and registrations,
copyrights, and any interest Seller may have in or to any of
the "Intangible Rights" of Buyer and/or Xxxxxx'x, as that
term is defined in the Stock Purchase Agreement
("Intellectual Property");
(iv) Equipment. All fixtures, equipment,
furniture, machinery, tools, racks, partitions, shelving,
exterior signs, refrigeration equipment, leasehold
improvements, software, computer hardware, terminals and
peripheral equipment and scanning systems owned by Seller or
in which Seller has any interest, including any leasehold
interest, located at the Store and used in the operation of
the Business (the "Equipment");
(v) Assigned Contracts. All right, title and
interest of the Seller in, to and under the "Assigned
Contracts" (as hereinafter defined);
(vi) Permits. Only to the extent transferable,
all right, title and interest of Seller in, to and under all
transferable licenses, permits, orders, certificates,
approvals and other government authorizations owned by
Seller exclusively in connection with Seller's occupancy or
operation of the Store;
(vii) Other Personal Property. All other
personal property of every nature or description owned by
Seller and used primarily in the operation of the Business,
including, but not limited to, all store supplies, general
intangibles, and the goodwill and going concern value of the
Business.
(b) Excluded Assets. Except for those assets
specified in Section 1(a) above, the Buyer shall not purchase or
acquire any assets, rights, interests and other properties of the
Seller (the "Excluded Assets"), including, without limitation,
the following:
(i) Cash and Cash Equivalents. All cash and cash
equivalents other than Cash on Hand, including all bank
deposits, checking and saving accounts and the like (other
than deposits in transit described in paragraph 1(a)(ii)B);
(ii) Prepaid Expenses. All prepaid expenses
relating to the Store other than prorated prepaid expenses
(the "Prepaid Expenses") and all refunds and deposits of
Seller;
(iii) Xxxxxx'x Stock. All stock of Xxxxxx'x,
Inc. owned by the Seller;
(iv) Corporate Records. All corporate and
financial books and records, Seller's corporate charter and
similar items;
(v) Life Insurance Policies. All life insurance
policies owned by Seller;
(vi) Real Property. Any real property owned
by the Seller, including the improvements thereon;
(vii) Tax Refunds. The right to any of the
Seller's claims for any federal, state, local or foreign tax
refunds relating to, or arising out of, the conduct of the
Business prior to the Effective Time;
(viii) Tri City Stock. All stock of Tri City
Bankshares Corporation owned by the Seller;
(ix) Hardware Store. All tangible and intangible
assets of the Tri City True Value Hardware Store located at
0000 Xxxxx 00xx Xxxxxx, Xxx Xxxxx, Xxxxxxxxx;
(x) Receivables. All notes receivable from NDC
Shareholders, and the "PECFA" receivable from the State of
Wisconsin; and
(xi) Non-Operating Assets. All of Seller's
corporate office assets, including, without limitation,
those assets listed on Section 1(b)(vii) of the Disclosure
Schedule.
(c) Assignment and Assumption of Contracts. The
"Assigned Contracts" consist of all of those leases, subleases,
contracts and agreements that are set forth on Section 6 (l) of
the Disclosure Schedule hereto and which are designated thereon
as "Assigned Contracts." At the Closing, effective as of the
Effective Time (as hereinafter defined), Seller will assign and
transfer to Buyer all of Seller's right, title and interest in,
to and under the Assigned Contracts, and Buyer will assume,
perform and discharge all of Seller's obligations and liabilities
arising after the Effective Time (and attributable to time
periods after the Effective Time) under the Assigned Contracts
(hereinafter "Contract Liabilities"); provided, that the Contract
Liabilities assumed by Buyer shall not in any event include:
(i) except as provided in Section 1(d), any
liability or obligation of Seller under any employment
agreement, collective bargaining agreement, agreements,
plans or arrangements concerning employee bonuses,
insurance, or other agreement with any employee, officer, or
shareholder of Seller; or any other liability or obligation
of any nature whatsoever of Seller to any employee or former
employee, whether pursuant to contract, arising by operation
of law, or otherwise to the extent they relate to matters
prior to the Effective Time; or
(ii) any liability or obligation attributable to
or arising as a result of any breach, violation, or non-
performance of any Assigned Contract by Seller prior to and
through the Effective Time, including, without limitation,
any breach or violation arising as a result of the
transactions contemplated by this Agreement.
(d) Assumption of Employee Accruals, Retirement Plan
Contributions, and Tenant Receivables Liability. Buyer will
assume the liability of Seller (i) for employee bonuses, vacation
and sick pay due from Seller to the "Transferred Employees" (as
that term is defined in Section 11(b)), but only in the amount
and to those persons for which Buyer receives a credit as
provided in Section 11(b) herein (the "Assumed Employee
Accruals"), (ii) for contributions to Seller's Profit Sharing and
401(k) Retirement Savings Plan on behalf of the Transferred
Employees (as that term is hereinafter defined) for the period
from January 1, 2000 through the Closing Date, in an amount equal
to four and one-half percent (4.5%) of compensation paid to the
Transferred Employees from January 1st, 2000 through the Closing
Date ("Accrued Retirement Plan Contributions") and (iii)
represented by the account on Seller's books called "Tenant
Receivables," consisting of amounts owed by Seller as of the
Effective Time to Aurora Pharmacy, Inc. under the contracts with
those parties that are included among the Assigned Contracts, but
only in the amount for which Buyer receives a credit as provided
in Section 11(c) herein (the "Tenant Receivables Liability").
(e) Execution of New Lease. At the Closing, Seller
will, and Xxxxxx'x will cause Jondex Corp. to, enter into a lease
of the Store site, in substantially the form attached hereto as
Exhibit 1(e) (the "New Lease"). In connection with the New
Lease, Seller will at the Closing execute and deliver to
Xxxxxx'x, for the benefit of Xxxxxx'x lenders, a Landlord's
Consent substantially in the form of that attached hereto as
Exhibit 1(e)(i).
2. LIABILITIES.
(a) Except for the Contract Liabilities expressly
assumed by Buyer under Section 1(c) above and the Assumed
Employee Accruals, Accrued Retirement Plan Contributions and
Tenant Receivables Liability assumed by Buyer pursuant to Section
1(d) above, Buyer shall not in any manner assume nor be liable or
responsible for any of the liabilities, debts, or obligations of
Seller or any NDC Shareholder, of any nature whatsoever,
including, but without limiting the generality of the foregoing,
the following:
(i) Past, current and future liabilities and
obligations of Seller for federal, state or local taxes of
any nature, including, without limitation, any interest,
penalties, additions to tax or costs of defense, and
including any taxes occasioned by the sale contemplated by
this Agreement, except for personal property taxes to be pro-
rated between Buyer and Seller as provided in Section 11
hereof; or
(ii) Liabilities or obligations of Seller of any
nature to employees or former employees relating to services
performed prior to the Effective Time, including, without
limitation, liabilities or obligations for wages,
withholding and employment taxes, vacation, sick pay,
bonuses, severance pay, retirement, and fringe benefits
incurred prior to and through the Effective Time, except for
Assumed Employee Accruals.
(b) Seller shall pay and discharge, when due, any and
all of the debts, liabilities and obligations of Seller which are
not assumed by Buyer.
3. PURCHASE PRICE. The purchase price to be paid by Buyer
to Seller for the Purchased Assets shall be Nine Million Five
Hundred Thousand Dollars ($9,500,000), plus an amount equal to
(i) the Cash on Hand and (ii) the value of the Inventory and
store supplies (in each case as valued and determined in
accordance with Section 5 hereof) as of the Effective Time, and
adjusted by the prorations and credits provided for in Section 11
hereof (the "Purchase Price").
4. PAYMENT AND ALLOCATION OF PURCHASE PRICE.
(a) Buyer shall pay the Purchase Price to Seller as
follows:
(i) At Closing, the sum of $9,500,000 plus the
parties' good faith estimate of the portion of the Purchase
Price attributable to Cash on Hand and the Inventory
("Estimated Cash and Inventory Value") shall be paid by wire
transfer of immediately available funds to an account
designated by Seller;
(ii) Upon the final determination of the value of
the Cash on Hand and Inventory as contemplated by Section 5
hereof, and the approval by Seller and Buyer of the final
closing statement, an amount equal to the difference between
the amount so determined (as further adjusted by the
prorations and credits provided for in Section 11) and the
Estimated Cash and Inventory Value shall be paid by Buyer to
Seller, or repaid by Seller to Buyer, as appropriate.
(b) The Purchase Price shall be allocated as follows:
(i) A portion of the Purchase Price equal to the
Cash on Hand, as determined pursuant to Section 5 hereof,
shall be allocated to cash and the several items included
within the definition of Cash on Hand as provided in
paragraph 1(a)(ii)B;
(ii) A portion of the Purchase Price equal to the
value of the Inventory, as determined pursuant to Section 5
hereof, shall be allocated to Inventory and store supplies;
(iii) $1,050,000.00 shall be allocated to
property and equipment;
(iv) $850,000.00 shall be allocated to leasehold
improvements.
(v) The remainder of the Purchase Price shall be
allocated to goodwill and the going concern value of the
Business.
The parties agree that they will file any reports
required to be filed (including, without limitation, I.R.S. Form
8594) under Section 1060 of the Internal Revenue Code of 1986, as
amended, consistent with the foregoing allocation and will not
take a position for income tax purposes which is inconsistent
with this Agreement.
5. PHYSICAL INVENTORY; DETERMINATION OF INVENTORY PRICE;
CLOSING.
(a) The transactions contemplated hereby will be
closed, and the sale and purchase of the Purchased Assets thereby
consummated, on March 31, 2000 or such other date as the parties
may mutually agree upon (the "Closing" or "Closing Date"). If
the Closing Date is March 31, 2000, the Closing will be deemed
effective for all purposes as of 11:59 p.m. on April 1, 2000
("Effective Time"). If the Closing Date is a date other than
March 31, 2000, the Effective Time will be such as the parties
mutually agree upon. This transaction shall be closed at the
offices of Xxxxx Xxxxxxxxxxx Xxxxx S.C., 000 Xxxx Xxxxxxxxx
Xxxxxx, Xxxxxxxxx, Xxxxxxxxx, or at such other place as the
parties may mutually agree.
(b) Inventory will be valued at its cost to Seller
consistent with the Company's historical methods for calculating
inventory values described in Section 5(b) of the Disclosure
Schedule, based on a physical inventory at the Store, to be taken
by Badger Inventory Services, Inc. (the "Inventory Service"), on
a date mutually agreed upon by Buyer and Seller, at or as near as
practicable to the Closing Date (the cost of the physical
inventory to be borne by Seller). The complete inventory
prepared by the Inventory Service shall be prepared in accordance
with the usual and customary practices of the industry and shall
show the total cost of such Inventory determined in the manner
provided above.
(c) For purposes of this Agreement (including Section
3 hereof) the several components of Cash on Hand will be valued
at their face amounts in a manner consistent with Seller's past
practice, except that deposits in transit will be included only
to the extent of amounts not reflected as part of the Closing
Date Net Book Value of Buyer for purposes of Section 3 of the
Stock Purchase Agreement. Seller will provide Buyer with
schedules setting forth in reasonable detail the components of
Cash on Hand and the values thereof.
(d) Buyer shall be given physical possession of the
Store and the Business at the Closing Date, but all revenue
earned and expense incurred by the Business through the Effective
Time will be for the account of the Seller. All revenue earned
and expense incurred after the Effective Time shall be for the
account of the Buyer.
6. REPRESENTATIONS AND WARRANTIES OF SELLER.
To induce Buyer and Xxxxxx'x to enter into this
Agreement, Seller makes the following representations and
warranties:
(a) Corporate Organization. Seller is a corporation
duly organized and validly existing under the laws of the State
of Wisconsin. Seller is current in all filings necessary to
maintain its corporate existence under Wisconsin law and no
proceedings have been filed or are pending for its dissolution or
winding up. Seller has all requisite corporate power and
authority to own, lease and operate the properties and assets it
now owns, leases or operates and to carry on its business as
presently conducted or presently proposed to be conducted.
(b) Authorization, Validity. Seller has all requisite
power and authority to enter this Agreement and to carry out its
obligations hereunder. The execution and delivery of this
Agreement and the consummation of the transactions contemplated
hereby have been duly authorized by the NDC Shareholders and
Seller's Board of Directors. This Agreement is the legal, valid
and binding obligation of Seller enforceable in accordance with
its terms, except that the enforceability of this Agreement is
subject to bankruptcy, insolvency, reorganization and similar
laws of general applicability relating to or affecting creditors'
rights and limitations on the availability of the remedy of
specific performance and other equitable relief. No claim,
action, suit, proceeding, arbitration, investigation or inquiry
before any federal, state, municipal, foreign or other court or
governmental or administrative body or agency, any securities or
commodities exchange, other regulatory body or any private
arbitration tribunal is now pending or, to the Knowledge of
Seller, threatened, against or relating to Seller which would
adversely affect the ability of Seller to consummate the
transactions contemplated by this Agreement or any other
agreement or instrument to be executed or delivered by the Seller
hereunder.
(c) Compliance. The execution, delivery and
performance of this Agreement by Seller and the consummation of
the transactions contemplated hereby will not: (i) violate or
conflict with any provision of the charter documents of Seller;
(ii) breach, violate or (whether immediately or with the lapse of
time or the giving of notice or both) constitute an event of
default under or an event which would give rise to any right of
termination, cancellation, modification, acceleration or
foreclosure under, or require any consent of or the giving of any
notice to any third party under, any material note, bond,
indenture, credit facility, mortgage, security agreement, lease,
license, franchise, permit or other agreement, instrument or
obligation to which Seller is a party, or by which Seller or any
of its properties or assets may be bound, or give rise to the
creation of any Encumbrance upon the properties or assets of
Seller; (iii) violate or conflict with any law, statute, rule,
regulation, ordinance, code, judgment, order, writ, injunction,
decree or other requirement of any court or of any governmental
body or agency thereof applicable to Seller or by which any of
its properties or assets may be bound; or (iv) require any
registration or filing by Seller with, or any permit, license,
exemption, consent, authorization or approval of, or the giving
of any notice by Seller to, any governmental or regulatory body,
agency or authority, other than the HSR Filings and applications,
approvals, or consents relating to the transfer of any "Licenses"
(as defined in Section 6(j) below). (d) Financial
Statements . Seller has heretofore delivered to Buyer copies of
the unaudited financial statements of the Business for the fiscal
years ended December 28, 1996, January 3, 1998 and January 2,
1999, and unaudited interim financial statements for the period
ended October 2, 1999. The aforesaid financial statements,
including all notes thereto, are herein referred to collectively
as the "Financial Statements." The Financial Statements (i) have
been prepared from and are consistent with the books and records
of Seller, (ii) have been prepared in accordance with GAAP
consistently applied during the periods covered thereby
(provided, that as unaudited financial statements, the Financial
Statements do not reflect customary year end adjustments and
accruals and lack footnote disclosure and other presentation
items), and (iii) fairly and accurately present the financial
condition and results of operations of the Business as of the
dates, and for the periods, stated therein.
(e) Absence of Certain Changes or Events . Except as
set forth in Section 6(e) of the Disclosure Schedule, since
January 2, 1999, Seller has carried on the Business in the
ordinary course and consistent with past practice. Except as set
forth in Section 6(e) of the Disclosure Schedule, or as expressly
contemplated by this Agreement, with the regard to the Business,
since October 2, 1999, Seller has not:
(i) suffered any damage, destruction or loss,
whether or not covered by insurance, affecting the Purchased
Assets or the Business, exceeding $10,000 individually or
$25,000 in the aggregate;
(ii) mortgaged, pledged or subjected to any lien,
charge or other encumbrance any of the Purchased Assets;
(iii) experienced any material adverse change
in the financial condition, results of operations, cash
flows, assets, liabilities, or operations of the Business;
(iv) made any change in any accounting principle
or practice or in its method of applying any such principle
or practice, relating to the Business; or
(v) entered into any agreement or commitment to
do any of the foregoing.
(f) Legal Proceedings. Except as set forth in
Section 6(f) of the Disclosure Schedule and except for claims,
suits, actions or proceedings alleging personal injury or
property damage where the amount claimed or reasonably estimated
to be at issue in each case is less than $25,000 and Seller's
insurance carrier has assumed the defense thereof, there are no
suits, actions, proceedings (including, without limitation,
arbitral and administrative proceedings), or claims (including
without limitation, worker's compensation claims) pending or, to
the Knowledge of Seller, any governmental investigations or
audits pending, nor to the Knowledge of Seller, are any of the
foregoing threatened, against Seller involving the Purchased
Assets or the Business. There are no such suits, actions,
proceedings, or claims pending, or, to the Knowledge of Seller,
any governmental investigations or audits pending, nor, to the
Knowledge of Seller, are any of the foregoing threatened,
challenging the validity or propriety of, or otherwise relating
to or involving, this Agreement or the transactions contemplated
hereby. There is no judgment, order, writ, injunction, decree or
award (whether issued by a court, an arbitrator, a governmental
body or agency thereof or otherwise) to which Seller is a party,
or involving the Purchased Assets or the Business, which is
unsatisfied or which requires continuing compliance therewith by
Seller.
(g) Taxes.
(i) Except as set forth in Section 6(g) of the
Disclosure Schedule, all returns and reports relating to
Taxes (as hereinafter defined) which are required to be
filed with respect to Seller on or before the date hereof or
which will be required to be filed on or before the Closing
Date have been, or will be, duly and timely filed. Except
as set forth in Section 6(g) of the Disclosure Schedule, all
Taxes as shown by such returns and reports to be due and
payable, or levied, assessed or imposed on the Business or
Seller through the Closing Date (except for those which by
their terms are not yet due and payable, or those which are
being contested in good faith by appropriate proceedings)
have been, or will be, paid. Except as set forth in Section
6(g) of the Disclosure Schedule, there are no actions or
proceedings currently pending or, to the Knowledge of
Seller, threatened against Seller by any governmental
authority for the assessment or collection of Taxes, no
claim for the assessment or collection of Taxes has been
asserted or, to the Knowledge of Seller, threatened, against
Seller, and there are no matters under discussion by Seller
with any governmental authority regarding claims for the
assessment or collection of Taxes against Seller. There are
no Tax liens on any of the Purchased Assets (other than any
lien for current Taxes not yet due and payable).
(ii) For purposes of this Agreement, the terms
"Tax" and "Taxes" shall mean and include any and all
foreign, national, federal, state, local, or other taxes,
charges, duties, fees, levies or other assessments, payments-
in-lieu of taxes, social security obligations, deficiencies,
fees, export or import duties, or other governmental
charges, including, without limitation, income, excise,
property, sales, use, gross receipts, recording, insurance,
value added, profits, license, withholding, payroll,
employment, net worth, capital gains, transfer, stamp,
social security, environmental, occupation and franchise
taxes, any installment payment for taxes and contributions
or other amounts determined with respect to compensation
paid to directors, officers, employees or independent
contractors, from time to time imposed by or required to be
paid to any governmental authority (and including any
additions to tax thereon, penalties for failure to pay any
Tax or make any deposit or file any return or report, and
interest on any of the foregoing).
(h) Title to Assets, Properties and Related Matters .
(i) Purchased Assets. The Purchased Assets are
free and clear of all security interests, encumbrances,
liens, mortgages, pledges, charges, conditional sale or
title retention agreements and restrictions, except liens
for personal property taxes not yet due and payable, and
those security interests described in Section 6(h)(i) of the
Disclosure Schedule for which full and complete releases
will be obtained by Seller at or prior to the Closing.
Except as set forth in Section 6(h)(i) of the Disclosure
Schedule, there are no currently effective Uniform
Commercial Code financing statements of record covering any
of the Purchased Assets.
(ii) Real Property. Seller's LLC is the owner of
the premises comprising the Store location (the "Real
Property"). Seller's LLC has good and marketable title in
fee simple to the Real Property, including all structures,
plants, improvements, systems and fixtures thereon (except
to the extent the same consist of leasehold improvements
included among the Purchase Assets hereunder), free and
clear of all Encumbrances whatsoever, except (i) as
specifically disclosed in Section 6(h)(ii) of the Disclosure
Schedule, (ii) liens for Taxes not yet delinquent or due and
payable, and (iii) easements, rights-of-way and similar
covenants and restrictions of record and municipal and
zoning ordinances and building use restrictions filed of
record which do not in any material way impair the use of
such property in the manner currently used or impair the
Seller's good and marketable title to such Real Property.
Except as set forth in Section 6(h)(ii) of the Disclosure
Schedule, none of the structures, plants, buildings,
improvements or systems located on the Real Property
encroaches on any real property owned by others. Except as
set forth in Section 6(h)(ii) of the Disclosure Schedule,
neither the Real Property nor any portion thereof is subject
to any sublease, license, or other agreement, arrangement or
understanding for its use or occupancy by any person other
than Seller.
(iii) Real Property Representations. Except
as set forth in Section 6(h)(iii) of the Disclosure
Schedule, no work has been performed on or with respect to
or in connection with the Real Property that would cause the
Real Property to become subject to any mechanics',
materialmen's, workmen's, repairmen's, carriers' or similar
liens aggregating in excess of $15,000. The structures,
plants, improvements, systems and fixtures (excluding
storage tanks or other impoundment vessels, whether above or
below ground) located on the Real Property conform with all
Federal, state and local statutes and laws and all
ordinances, rules, regulations and similar governmental and
regulatory requirements applicable to their current uses
(except as set forth in Section 6(h)(iii) of the Disclosure
Schedule, and except for Environmental Laws which are
addressed exclusively in Section 6(r)) and are in good
operating condition and repair, ordinary wear and tear
excepted. The Real Property, in view of the purposes for
which it is currently used, conforms with all covenants or
restrictions of record and conforms with all applicable
building codes and zoning requirements; to the Knowledge of
Seller, current, valid certificates of occupancy (or
equivalent governmental approvals) have been issued for the
Real Property to the extent required by law; and Seller has
no Knowledge of any proposed material change in any such
governmental or regulatory requirements or in any such
zoning requirements. Except as set forth in Section
6(h)(iii) of the Disclosure Schedule, all existing
electrical, plumbing, fire sprinkler, lighting, air
conditioning, heating, ventilation, elevator and other
mechanical systems located in or about the Real Property are
in good operating condition and repair, ordinary wear and
tear excepted. Seller has all easements, rights-of-way and
similar rights necessary to conduct the Business as
presently conducted and to use the Real Property as
currently used, including, without limitation, easements and
licenses for pipelines, power lines, water lines, roadways
and other access. All such easements and rights are valid,
binding and in full force and effect, any amounts due and
payable thereon to date have been paid or have been fully
accrued for in the books and records of Seller, neither
Seller nor any other party thereto is in default thereunder,
and there exists no event or condition affecting Seller or
any other party thereto, which, with the passage of time or
notice or both, would constitute a material default
thereunder. No such easement or right will be breached by,
nor will any party thereto be given a right of termination
as a result of, the transactions contemplated by this
Agreement.
(iv) Personal Property. All items of
personal property included among the Purchased Assets (as
well as any that are leased pursuant to any of the Assigned
Contracts) are in good operating condition and repair,
ordinary wear and tear excepted, are physically located at
or about the Real Property, and are owned outright by
Seller, or validly leased by the Seller. No such item of
personal property is subject to any sublease, license or
other agreement, arrangement or understanding for its use by
any person other than Seller. The maintenance and operation
thereof has complied with all applicable laws, regulations,
ordinances, contractual commitments and obligations. Except
as set forth in Section 6(h)(iv) of the Disclosure Schedule
or as disclosed in the Financial Statements, no item of
tangible personal property with a fair market value
exceeding $10,000 owned or used by Seller is subject to any
conditional sale agreement, installment sale agreement or
title retention or security agreement or arrangement of any
kind; as to each item of personal property subject to any
such agreement or arrangement, Section 6(h)(iv) of the
Disclosure Schedule sets forth a brief description of the
property in question and the underlying obligation.
(i) Computer Software . All computer software used
by Seller or installed on any computers owned or used by Seller
is either (i) owned by Seller or (ii) used pursuant to valid and
effective licenses from the owners thereof. Seller is not in
material breach or default under any of such licenses, and has
not received any notice suggesting or alleging that any such
material breach or default has occurred or that Seller is using
or has used any computer software without an appropriate license
therefor.
(j) Licenses, Permits, Authorizations and Consents .
(i) Section 6(j) of the Disclosure Schedule sets
forth all material approvals, authorizations, consents,
licenses, orders and permits of all governmental and
regulatory authorities, whether foreign, federal, state or
local (collectively, "Licenses") used in or required for the
conduct of the Business. Each of the Licenses is in full
force and effect. Seller has complied with all of the
terms, conditions and requirements imposed by each of the
Licenses, except where the failure so to comply would not
have a Material Adverse Effect. Seller has not received any
notice of, and Seller has no Knowledge of, any intention on
the part of any appropriate authority to cancel, revoke or
modify, or any inquiries, proceedings or investigations the
purpose or possible outcome of which is the cancellation,
revocation or modification of any such permit, license,
exemption, consent, authorization or approval, except as set
forth in Section 6(j) of the Disclosure Schedule. The
Licenses set forth in Section 6(j) of the Disclosure
Schedule include all Licenses which are required for the
ownership of the Purchased Assets or the conduct of the
Business as it is presently conducted, except for Licenses
the absence of which would not have a Material Adverse
Effect. Licenses required under the Environmental Laws are
addressed exclusively in Section 6(r).
(ii) Except as set forth on Section 6(j) of
the Disclosure Schedule and except for the filing of notices
with the appropriate authorities under the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act ("HSR Filings") and the
expiration of the waiting periods thereunder, no consent,
approval or authorization of, or declaration, filing or
registration with, any governmental or regulatory authority
or agency, whether federal, state or local, is required in
connection with the execution or delivery of this Agreement
by Seller or the consummation by Seller of any of the
transactions contemplated hereby. Except as set forth in
Section 6(j) of the Disclosure Schedule, no consent of any
other entity, agency or person is required in connection
with the execution or delivery of this Agreement by Seller
or the consummation by Seller of any of the transactions
contemplated hereby, including, without limitation, consents
from any party to any Contract (whether or not an Assigned
Contract) to which Seller is a party, or which is applicable
to the Business or the Purchased Assets.
(k) Patents, Trademarks, Etc. Section 6(k) of the
Disclosure Schedule sets forth a complete and correct list of all
Intellectual Property. Except as set forth on Section 6(k) of
the Disclosure Schedule, Seller has the right to use all of the
Intellectual Property, including, but not limited to the name
"Mega Food Center," in the Business as and where the same is
currently conducted, and the use of such Intellectual Property in
the conduct of the Business as and where the same is currently
conducted does not conflict with the rights of others in any
manner. Except as set forth in Section 6(k) of the Disclosure
Schedule, there are no licenses, agreements or commitments
outstanding or effective granting any other person any right to
use, operate under, license or sublicense the Intellectual
Property. Seller has not received any notice or claim that any
of the Intellectual Property infringes upon or conflicts with the
rights of any other person. Except as set forth in Section 6(k)
of the Disclosure Schedule, to the Knowledge of Seller, there is
no infringement or violation by any other person of Seller's
rights in any of the Intellectual Property.
(l) Leases, Contracts, Etc . All leases, subleases,
maintenance agreements, service agreements and all other
agreements of any nature, whether written or oral, affecting the
Store or the Business or the Purchased Assets (collectively
"Contracts"), other than Purchase Orders (as hereinafter
defined), are listed on Section 6(l) (or on Sections 6(k) or
6(m)(i)) of the Disclosure Schedule. Except as set forth on
Section 6(l) (or on Sections 6(k) or 6(m)(i)) of the Disclosure
Schedule, for Purchase Orders, and for other contracts,
arrangements or understandings that would have been required to
be identified on any of the foregoing sections of the Disclosure
Schedule but for the fact that they were excepted from disclosure
pursuant to the terms of the applicable Section of this
Agreement, and except for agreements between the Seller and
Buyer, Seller is not a party to or subject to any Contract that
relates to the Business or Purchased Assets, including without
limitation any of the following:
(i) any contract, arrangement or understanding,
or series of related contracts, arrangements or
understandings, other than Purchase Orders, which involves
annual expenditures or receipts by Seller of more than
$25,000;
(ii) any personal property lease wherein the
property leased has a fair market value exceeding $25,000 or
the total annual rental payments in any year exceed $10,000;
(iii) any lease or sublease (as lessor or
lessee) of real property;
(iv) any license agreement other than software
licenses described in clause (i) of the first sentence of
Section 6(i) hereof;
(v) any contract, arrangement or understanding
not made in the ordinary course of business and consistent
with past practice involving annual payments not exceeding
$15,000 in each case;
(vi) any note, bond, indenture, credit
facility, mortgage, security agreement or other instrument
or document relating to or evidencing indebtedness for money
borrowed or a security interest or mortgage in the Purchased
Assets;
(vii) any contract, arrangement or
understanding granting to any person the right to use any
material item of the Purchased Assets; or
(viii) any outstanding offer or commitment to
enter into any contract or arrangement of the nature
described in subsections (i) through (vii) of this Section
6(l).
For purposes of this Agreement "Purchase Orders" shall mean
those purchase orders of Seller relating to the Business and
other contracts and commitments issued or entered into by Seller
relating to the Business to or with its suppliers and vendors for
the purchase of goods, products and supplies in the ordinary
course of business and on Seller's standard terms and conditions.
Seller previously has delivered to the Buyer and Xxxxxx'x
complete and correct copies of each written Contract (and any
amendments thereto), and Section 6(l) of the Disclosure Schedule
also contains a complete and correct description of each oral
Contract to which Seller is a party or bound which is required to
be disclosed on Section 6(l) of the Disclosure Schedule. Except
as set forth in Section 6(l) of the Disclosure Schedule, (i) each
Assigned Contract is in full force and effect; (ii) neither
Seller nor (to the Knowledge of Seller) any other party is in
material default under any Assigned Contract, and no event has
occurred which constitutes, or with the lapse of time or the
giving of notice or both would constitute, a default by Seller or
(to the Knowledge of Seller) by any other party under any
Assigned Contract; and (iii) there are no material disputes or
disagreements between Seller and any other party with respect to
any Assigned Contract.
(m) Employees .
(i) Seller previously has delivered to the Buyer
a schedule setting forth the names of all current salaried
and hourly employees of the Business and their current
salary or hourly rates. Except as set forth in Section 6(m)
of the Disclosure Schedule, Seller has accrued on its books
and records all obligations for salaries, vacations,
benefits and other compensation with respect to its
employees and any of its Former Employees (as hereinafter
defined), to the extent required by GAAP, including, but not
limited to, severance, bonuses, incentive and deferred
compensation. Except as disclosed in Section 6(m) of the
Disclosure Schedule, Seller does not currently offer, nor
has it ever offered, retiree health or insurance benefits to
employees or Former Employees (as hereinafter defined) of
the Business, and the Seller has no liabilities (contingent
or otherwise) with respect thereto. Complete and correct
copies of all material written agreements with or concerning
any employee (or any Former Employee) of the Business,
including, without limitation, union and collective
bargaining agreements, and all employment policies, employee
handbooks, and the like relating to the Business, and all
amendments and supplements thereto, have previously been
delivered to the Buyer, and a list of all such agreements,
handbooks and policies is set forth in Section 6(m) of the
Disclosure Schedule. Except as set forth in Section 6(m) of
the Disclosure Schedule and except pursuant to the terms of
any contract or agreement to which Seller is a party and
which is listed in any Section of the Disclosure Schedule,
since the latest Financial Statement, Seller has not
(i) except in the ordinary course of business and consistent
with past practice, increased the salary or other
compensation payable or to become payable to or for the
benefit of any of the employees of the Business,
(ii) provided any of the employees of the Business with any
increased security or tenure of employment, (iii) increased
the amounts payable to any of the employees of the Business
upon the termination of any such person's employment, or
(iv) amended any Benefit Plan (as hereafter defined) to
provide improved benefits granted to or for the benefit of
any of the employees of the Business under any Benefit Plan
(as hereinafter defined).
(ii) Since January 1, 1995, and to the Knowledge
of Seller, prior to that date, Seller has complied at all
times with all laws, statutes, rules and regulations
applicable with respect to employees or employment practices
in connection with the Business. In particular, Seller has,
in connection with the Business, complied with all laws and
statutes, and all rules and regulations applicable to and/or
aiming at discriminatory practices (including, without
limitation, discrimination based on race, age or gender),
labor standards and working conditions, occupational health
and safety, payment of minimum wages and overtime rates,
worker's compensation, the withholding and payment of Taxes
or any other kind of governmental charge from any kind of
compensation, or otherwise relating to the conduct of
employers with respect to employees or potential employees,
and there have been no claims made or, to the Knowledge of
Seller, threatened thereunder against Seller arising out of,
relating to or alleging any violation of any of the
foregoing, which claims, if resolved adversely to the
Seller, would have a Material Adverse Effect. Seller has,
in connection with the Business, complied in all material
respects with the employment eligibility verification form
requirements under the Immigration and Naturalization Act,
as amended ("INA"), in recruiting, hiring, reviewing and
documenting prospective employees for employment eligibility
verification purposes and has complied with the paperwork
provisions and anti-discrimination provisions of the INA,
except where failure to comply would not have a Material
Adverse Effect. Seller has obtained and maintained the
employee records and I-9 forms in proper order as required
by law. Except as set forth in Section 6(m) of the
Disclosure Schedule, and except for routine grievances none
of which, if resolved adversely to Seller, would,
individually or in the aggregate, have a Material Adverse
Effect, there are no material controversies, strikes, work
stoppages, picketing or disputes pending or, to the
Knowledge of Seller, threatened between Seller and any
employees or Former Employees of the Business; no
organizational effort by any labor union or other collective
bargaining unit is pending or, to the Knowledge of Seller,
threatened with respect to any employees of the Business;
and no consent of or any other action by or negotiation with
any labor union or other collective bargaining unit is
required in connection with or to consummate the
transactions contemplated by this Agreement.
(n) Benefit Plans.
(i) For purposes hereof, the term "Benefit Plan"
shall mean each and every defined benefit and defined
contribution plan, employee stock ownership plan, consulting
or employment agreement, executive compensation plan, bonus
plan, incentive compensation plan or arrangement, deferred
compensation agreement or arrangement, agreement with
respect to temporary employees, vacation pay, sickness,
disability or death benefit plan (whether provided through
insurance, on a funded or unfunded basis or otherwise),
employee stock option or stock purchase plan, severance pay
plan, arrangement or practice, employee relations policy,
practice or arrangement, retiree medical or life insurance
benefits, and each other employee benefit plan, program or
arrangement, which at any time has been maintained or
contributed to by Seller for the benefit of or relating to
any of the employees or to any former employee of the
Business ("Former Employee") or his/her dependents,
survivors or beneficiaries, whether written or oral, but not
including any multi-employer benefit plans within the
meaning of Section 3(37) of ERISA (a "Multi-Employer Plan").
Section 6(n)(i) of the Disclosure Schedule contains a
complete and correct list of all current Benefit Plans.
(ii) Except as set forth on Schedule 6(n)(ii) of
the Disclosure Schedule, each Benefit Plan which is an
"employee pension benefit plan" (as defined in Section 3(2)
of ERISA), meets the requirements of Section 401(a) of the
Code; the trust, if any, forming part of such plan is exempt
from U.S. federal income tax under Section 501(a) of the
Code; a favorable determination letter has been issued by
the Internal Revenue Service (the "IRS") with respect to
each plan and trust and each material amendment thereto; and
nothing has occurred since the date of such determination
letter that would adversely affect the qualification of such
plan. No Benefit Plan is a "voluntary employees beneficiary
association" (within the meaning of Section 501(c)(9) of the
Code) and there are no current "welfare benefit funds"
relating to Employees or Former Employees within the meaning
of Section 419 of the Code other than as set forth in
Section 6(n)(ii) of the Disclosure Schedule. No event or
condition exists which respect to any Benefit Plan that
could subject Seller to any material Tax under Section 4980B
of the Code (or under its predecessor statute, Section
162(k) of the Code). With respect to each Benefit Plan
listed on Schedule 6(n)(i), Seller has heretofore delivered
to the Buyer and Xxxxxx'x complete and correct copies of the
following documents, where applicable: (i) the most recent
annual report (Form 5500 series), together with schedules,
as required, filed with the IRS, and any financial
statements and opinions required by Section 103(a)(3) of
ERISA, (ii) the most recent determination letter issued by
the IRS, (iii) the most recent summary plan description and
all modifications, as well as all other descriptions
distributed to employees or set forth in any manuals or
other documents, (iv) the text of the Benefit Plan and of
any trust, insurance or annuity contracts maintained in
connection therewith, (v) the most recent independent
appraisal in the case of an employee stock ownership plan,
and (vi) the most recent actuarial report, if any, relating
to the Benefit Plan.
(iii) Except as set forth on Schedule
6(n)(iii) of the Disclosure Schedule, neither Seller nor any
corporation or other trade or business under common control
with Seller (as determined pursuant to Section 414(b) or (c)
of the Code) (a "Common Control Entity") has maintained or
contributed to or in any way directly or indirectly has any
liability (whether contingent or otherwise) with respect to
any Multi-Employer Plan. Seller has not completely or
partially withdrawn from any Multi-Employer Plan and, except
as set forth in Section 6(n)(iii) of the Disclosure
Schedule, Seller would have no withdrawal liability under
Title IV of ERISA if they were to withdraw as of the date
hereof from any multi-employer plan to which Seller has
contributed. To the Knowledge of Seller, no proceedings by
the Pension Benefit Guaranty Corporation (the "PBGC") to
terminate any Benefit Plan have been instituted or
threatened. To the Knowledge of Seller: no event has
occurred or condition exists which constitutes grounds for
the PBGC to terminate any Benefit Plan; neither Seller nor
any Common Control Entity is a party to or has any liability
under any agreement imposing secondary liability on it as a
seller of the assets of a business in accordance with
Section 4204 of ERISA or under any other provision of Title
IV of ERISA or other agreement; no contingent or other
liability with respect to which Seller has, had or could
have any liability exists under Title IV of ERISA to the
PBGC or to any Benefit Plan. None of the Purchased Assets
are subject to a lien under Sections 4064 or 4068 of ERISA.
Except as set forth in Section 6(n)(iii) of the Disclosure
Schedule, the Seller does not currently maintain or
contribute to any plan subject to Title IV of ERISA or
Section 412 of the Code (other than Multi-Employer Plans),
and, except as set forth in Section 6(n)(iii) of the
Disclosure Schedule, each such plan previously maintained or
contributed to by Seller has been terminated in accordance
with the provisions of the Code and ERISA and Seller does
not have any actual or contingent liability associated with
any such terminated plan, including, but not limited to, any
future obligations or liability associated with (i) the
solvency or ability to provide benefits of any insurance
company providing annuity payments under such terminated
plan, (ii) claims by participants resulting from any alleged
breach of fiduciary duty in connection with the termination
of any such terminated plan, or (iii) the disqualification
of any such terminated plan. All contributions and payments
required to be made to or with respect to each Benefit Plan
(including contributions to union-sponsored pension or
health and welfare plans) with respect to the service of
employees or other individuals with or related to Seller
prior to the date hereof have been made or have been accrued
for in the Financial Statements, or, for periods after the
most recent of the Financial Statements and through the
Closing Date, will be accrued in the books and records of
Seller, and will be accrued and reflected as liabilities on
the Closing Balance Sheet and, except to the extent so
accrued, Seller shall have no liability to or with respect
to any Benefit Plan relating to such prior period.
Except as set forth in Section 6(n)(iii) of the
Disclosure Schedule, Seller does not provide, nor does it
have any obligation to provide, post-retirement medical,
life insurance or other benefits to employees or Former
Employees or their survivors, dependents and beneficiaries,
except as may be required by the Consolidated Omnibus Budget
Reconciliation Act of 1986 or similar state medical
temporary benefits continuation law. Except as set forth in
Section 6(n)(iii) of the Disclosure Schedule, Seller will
not incur any liability under any severance agreement,
deferred compensation agreement, employment agreement or
other compensation agreement as a result of the consummation
of the transactions contemplated by this Agreement, nor will
the terms or Seller's liability or obligations under any
such agreement be altered or increased as a result of such
transactions.
(iv) Except as set forth in Section 6(n)(iv) of
the Disclosure Schedule: none of the Benefit Plans has been
subject to a "reportable event," within the meaning of
Section 4043 of ERISA (whether or not waived); there have
been no "prohibited transactions", within the meaning of
Section 4975 of the Code or Part 4 of Subtitle B of Title I
of ERISA; there have been no breaches of fiduciary
responsibility within the meaning of Part 4 of Subtitle B of
Title I of ERISA; and none of the Benefit Plans which are
subject to Section 412 of the Code has incurred any
"accumulated funding deficiency" (whether or not waived)
within the meaning of Section 412 of the Code and no event
or set of conditions exist which could subject Seller to any
material Tax under Section 4971 of the Code or a lien under
Section 412(n) of the Code.
(v) Each Benefit Plan has been administered to
date in accordance with the applicable provisions of ERISA,
the Code and applicable law and with the terms and
provisions of all documents, contracts or agreements
pursuant to which such Benefit Plan is maintained. All
reports and information required to be filed with the
Department of Labor, the IRS, the PBGC or plan participants
or beneficiaries with respect to any Benefit Plan have been
timely filed; there is no dispute, arbitration, claim, suit
or grievance pending or to the Knowledge of Seller,
threatened, involving a Benefit Plan (other than routine
claims for benefits). To the Knowledge of Seller, none of
the Benefit Plans nor any fiduciary thereof has been the
direct or indirect subject of an order or investigation or
examination by a governmental or quasi-governmental agency
and there are no matters pending before the IRS, the
Department of Labor, the PBGC or any other domestic or
foreign governmental agency with respect to a Benefit Plan.
There have been no claims, or notice of claims, filed under
any fiduciary liability insurance policy covering any
Benefit Plan. Seller will incur no liability or obligation
to make any "parachute payment" (as that term is defined in
Section 280G(b)(2) of the Code) to any of the employees
prior to the Closing or in connection with the transactions
contemplated hereby. No event or set of conditions exist
which would subject Seller to any material Tax under
Sections 4972, 4974-76, 4979, 4980, 4999 or 5000 of the
Code.
(o) Compliance with Applicable Law . Except as set
forth in Section 6(o) of the Disclosure Schedule, Seller has
complied with all applicable foreign or domestic laws and
statutes and all ordinances, codes, rules, regulations,
judgments, orders, injunctions, writs or decrees of any Federal,
state, local or foreign court or any governmental body or agency
thereof to which Seller may be subject in connection with the
Business or which are applicable to the Business (as it is
currently conducted) or the Purchased Assets (except for the
Environmental Laws, which are addressed exclusively in Section
6(r)). Seller has not received any written notice alleging any
such violation.
(p) Inventories. Except for Inventory which has
been written down on the books of Seller to its net realizable
value, or is eligible to be returned to the vendors thereof, the
Inventory is of merchantable and salable quality and is not
damaged or outdated. The quantities of Inventory on hand are
such that they can reasonably be expected (on the basis of
Seller's past experience) either (i) to be sold within the time
period remaining prior to the expiration of their applicable date
codes, or (ii) to be able to be returned to the vendors thereof.
(q) [intentionally left blank]
(r) Environmental Matters .
(i) No Hazardous Substances. Except as set forth
in Section 6(r)(i) of the Disclosure Schedule, and except
for Hazardous Substances (as hereinafter defined in Section
6(r)(iii)) generated, stored, treated, manufactured,
refined, handled, produced, disposed of or used by Seller in
the ordinary course of its business, in compliance with the
requirements of currently applicable laws, rules and
regulations or otherwise in a manner which would not give
rise to any liabilities or obligations under such laws,
rules and regulations (i) the Seller has not caused there to
be, nor to the Knowledge of the Seller are there, any
Hazardous Substances in, on or under any of the Real
Property; (ii) the Real Property has not been designated,
restricted or investigated by any governmental authority as
a result of the actual or suspected presence, spillage,
leakage, discharge or other emission of Hazardous
Substances; (iii) no Hazardous Substances have been
generated, used, stored, treated, manufactured, refined,
handled, produced or disposed of in, on or under, and no
Hazardous Substances have been transported, released or
disposed of at, from or to, the Real Property by Seller or
by any persons or agents operating under the control,
direction and supervision of Seller including, without
limitation, all employees, agents and contractors of Seller;
and (iv) Seller has not received any written or oral
governmental notice, order, inquiry, investigation,
environmental audit or assessment or any lien, encumbrance,
decree, easement, covenant, restriction, servitude or
proceeding concerning, or arising by reason of, the actual
or suspected presence, spillage, leakage, discharge,
disposal or other emission of any Hazardous Substance in,
on, under, around, about or in the vicinity of, or the
transportation of any Hazardous Substance at, from or to,
the Real Property. Section 6(r)(i) of the Disclosure
Schedule contains a list of all above ground or underground
tanks used for the storage of Hazardous Substances on or
below the surface of the Real Property;
(ii) Compliance with Environmental Laws. Except
as disclosed in Section 6(r)(ii) of the Disclosure Schedule,
and except for conditions that are not attributable to any
act or omission of the Seller and of which the Seller has no
Knowledge, (i) neither Seller nor the Real Property
(including storage tanks or other impoundment vessels,
whether above or below ground) are in material violation of,
or subject to any material liabilities as a result of any
past or current violations of, any existing federal, state
or local law (including common law), statute, ordinance,
rule or regulation of any federal, state or local
governmental authority relating to occupational health and
safety or relating to pollution or protection of the
environment, including, without limitation, statutes, laws,
ordinances, rules and regulations relating to the emission,
generation, discharge, spillage, leakage, storage, off-site
dumping, release or threatened release of Hazardous
Substances into ambient air, surface water, ground water or
land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport
or handling of Hazardous Substances (collectively,
"Environmental Laws"); and (ii) no material expenditures are
required in connection with the operation of the Business as
presently conducted in order to comply with any
Environmental Laws. Except as disclosed in Section 6(r)(ii)
of the Disclosure Schedule, Seller and the Real Property
have in all material respects passed all inspections
conducted by applicable governmental authorities and
regulatory bodies in connection with the matters described
in the preceding sentence. The Seller has all approvals,
authorizations, consents, licenses, orders and permits of
all governmental and regulatory authorities required under
any Environmental Laws (collectively, "Environmental
Permits"), except for Environmental Permits the lack of
which could not give rise to any material obligation or
liability on the part of the Seller or otherwise have any
Material Adverse Effect, nor impair the ability of the
Seller to conduct any material aspect of the Business at any
one or more of its locations. Each of the Environmental
Permits is in full force and effect. The Seller has
complied with all of the terms, conditions and requirements
imposed by each of the Environmental Permits, except where
the failure so to comply would not have a Material Adverse
Effect. The Seller have received no notice of, and has no
Knowledge of, any intention on the part of any appropriate
authority to cancel, revoke or modify, or any inquiries,
proceedings or investigations the purpose or possible
outcome of which is the cancellation, revocation or
modification of any such Environmental Permit. All cleanup,
removal and other remediation activities carried out by
Seller or by agents of Seller at the Real Property have been
conducted in material compliance with all applicable
Environmental Laws, and there is no basis for liability on
the part of Seller as a result of such activities.
(iii) Definition of "Hazardous Substances".
For purposes of this Agreement, the term "Hazardous
Substance" shall mean any product, substance, chemical,
contaminant, pollutant, effluent, waste or other material
which, or the presence, nature, quantity and/or intensity of
existence, use, manufacture, disposal, transportation,
emission, discharge, spill, release or effect of which,
either by itself or in combination with other materials
located on any of the Real Property, is defined or listed
in, regulated or monitored by, or otherwise classified
pursuant to, any statute, law, ordinance, rule or regulation
applicable to the Real Property as "hazardous substances,"
"hazardous materials," "hazardous wastes," "infectious
wastes" or "toxic substances." Hazardous Substances shall
include, but not be limited to, (i)(A) any "hazardous
substance" as defined in the Comprehensive Environmental
Response, Compensation and Liability Act, (B) any "regulated
substance" as defined in the Solid Waste Disposal Act or
(C) any substance subject to regulation pursuant to the
Toxic Substances Control Act, as such laws are now in effect
or may be amended through the Closing Date and any rule,
regulation or administrative or judicial policy statement,
guideline, order or decision under such laws, (ii) petroleum
and refined petroleum products, (iii) asbestos and asbestos-
containing products, (iv) flammable explosives, (v)
radioactive materials, and (vi) radon.
(iv) This Section 6(r) contains the sole
representations and warranties of the Seller with respect to
any matters that relate to or are governed by Environmental
Laws.
(s) Disclosure. No representation or warranty made by
Seller in this Section 6 (including, without limitation, any
section of the Disclosure Schedule relating thereto), and no
section of the Disclosure Schedule, certificate or other written
document or instrument delivered or to be delivered by Seller, as
applicable, pursuant to this Agreement or in connection with the
transactions contemplated hereby, contains or will contain, any
untrue statement of a material fact or omits or will omit to
state any material fact necessary to make the statements
contained therein not misleading. The disclosure of any matter
in any schedule to this Agreement shall be deemed to be a
disclosure for all purposes of this Agreement to which such
matter could reasonably be expected to be pertinent.
(t) Reliance . The representations and warranties of
Seller made in Section 6 of this Agreement are made by Seller
with the knowledge and expectation that the Buyer and Xxxxxx'x
are placing reliance thereon in entering into, and performing
their obligations under this Agreement, and the same shall not be
affected or deemed waived in any respect whatsoever by reason of
any investigation heretofore or hereafter conducted or knowledge
gained by or on behalf of the Buyer or Xxxxxx'x (including,
without limitation, by any of their advisors, consultants or
representatives and any information contained in any Phase I or
Phase II or other environmental audit or investigation procured
by or on behalf of the Buyer or Xxxxxx'x or otherwise) prior to
the Closing, whether in contemplation of this Agreement or
otherwise, or by reason of the fact that the Buyer or Xxxxxx'x or
any of such advisors, consultants or representatives knew or
should have known that any such representation or warranty is or
might be inaccurate, or that any covenant or undertaking has been
or might have been breached, at or prior to the Closing, and no
claims by the Buyer or Xxxxxx'x with respect thereto shall be
waived or otherwise affected as a result of such knowledge on the
part of the Buyer or Xxxxxx'x (or any of their advisors,
consultants or representatives) and Seller shall not raise any
such matter as a defense to any claim by the Buyer or Xxxxxx'x
for indemnification hereunder; provided that the Buyer or
Xxxxxx'x shall provide the Seller with written notice of any
fact, matter or circumstance of which the Buyer or Xxxxxx'x is or
has become aware which would or which the Buyer or Xxxxxx'x
reasonably believes might be considered to constitute a breach or
violation of any representation, warranty, covenant or agreement
of Seller in this Agreement.
(u) Disclosure Schedule. Any information which is
disclosed in the Disclosure Schedule or any other Schedule or
Exhibit hereto shall be deemed to be disclosed for all Sections
of this Agreement to which such disclosure is relevant. All
capitalized terms used in the Disclosure Schedule and not
otherwise defined therein shall have the same meanings as are
ascribed to such terms in this Agreement. The Disclosure
Schedule shall not vary, change or alter the literal meaning of
the representations and warranties of Seller contained in this
Agreement, other than creating specific, limited exceptions
thereto which are directly responsive to the language of the
applicable warranties and representations contained in this
Agreement. Seller shall be entitled to amend the Disclosure
Schedule prior to Closing; provided, however, (i) such
amendments, if any, shall occur no later than the earlier of
Closing or two days after the matter causing the amendment comes
to the Knowledge of Seller, (ii) that such amendments may be made
only to the extent that the Buyer and Xxxxxx'x approve the same
(such approval not to be withheld in bad faith).
7. REPRESENTATIONS AND WARRANTIES OF XXXXXX'X.
To induce Seller to enter into this Agreement, Xxxxxx'x
makes the following representations and warranties:
(a) Corporate Organization. Xxxxxx'x is a corporation
duly organized and validly existing under the laws of the State
of Wisconsin. Xxxxxx'x is current in all filings necessary to
maintain its corporate existence under Wisconsin law and no
proceedings have been filed or are pending for its dissolution or
winding up. Xxxxxx'x has all requisite corporate power and
authority to own, lease and operate the properties and assets it
now owns, leases or operates and to carry on its business as
presently conducted or presently proposed to be conducted.
(b) Authorization. Xxxxxx'x has full corporate power
and authority to execute, deliver and perform this Agreement.
The execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby have been duly approved
by the Board of Directors of Xxxxxx'x, and no other corporate
action on the part of Xxxxxx'x is necessary to approve and
authorize the execution and delivery of this Agreement by
Xxxxxx'x or the consummation of the transactions contemplated
hereby. This Agreement has been duly executed and delivered by
Xxxxxx'x and constitutes the valid and binding agreement of
Xxxxxx'x enforceable in accordance with its terms, except that
the enforceability of this Agreement is subject to bankruptcy,
insolvency, reorganization and similar laws of general
applicability relating to or affecting creditors' rights and
limitations on the availability of the remedy of specific
performance and other equitable remedies.
(c) Consents and Approvals; No Violations. Except as
set forth in Section 7(c) of the Disclosure Schedule, the
execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby will not: (i) violate or
conflict with any provision of the charter documents of Xxxxxx'x,
(ii) breach, violate or constitute an event of default (or an
event which with the lapse of time or the giving of notice or
both would constitute an event of default) under, give rise to
any right of termination, cancellation, modification,
acceleration or foreclosure under, or require any consent or the
giving of any notice under, any note, bond, indenture, mortgage,
security agreement, lease, license, franchise, permit, agreement
or other instrument or obligation to which Xxxxxx'x is a party,
or by which Xxxxxx'x or any of its properties or assets may be
bound, or result in the creation of any encumbrance or other
right of any third party of any kind whatsoever upon the
properties or assets of Xxxxxx'x pursuant to the terms of any
such instrument or obligation, (iii) except for the obtaining of
the permits, licenses and approvals necessary to operate the
Business as set forth in Section 7(c) of the Disclosure Schedule,
violate or conflict with any law, statute, ordinance, code, rule,
regulation, judgment, order, writ, injunction, decree or other
instrument of any court or governmental or regulatory body,
administration, agency or authority applicable to Xxxxxx'x or by
which any of its properties or assets may be bound or (iv) except
for the obtaining of the permits, licenses and approvals
necessary to operate the Business as set forth in Section 7(c) of
the Disclosure Schedule, require any filing by Xxxxxx'x with, or
any permit, license, exemption, consent, authorization or
approval of, or the giving of any notice by Xxxxxx'x to, any
governmental or regulatory body, agency or authority, other than
the HSR Filings (as defined in Section 6(j)(ii)) and the
expiration of the waiting periods thereunder.
(d) No Brokers or Finders. Neither Xxxxxx'x nor any
of its officers, directors or employees, on behalf of Xxxxxx'x,
has employed any broker or finder or incurred any other liability
for any brokerage fees, commissions or finders' fees in
connection with the transactions contemplated hereby.
(e) Financial Statements. Xxxxxx'x has provided to
Seller true and complete copies of the financial statements of
Xxxxxx'x consisting of (i) balance sheets of Xxxxxx'x as of
January 2, 1999 and January 3, 1998 and the related statements of
income and cash flows for the years then ended (including the
notes contained therein or annexed thereto), which financial
statements have been reported on, and are accompanied by, the
signed, unqualified opinions of Deloitte & Touche LLP,
independent auditors for Xxxxxx'x for such years and (ii) an
unaudited balance sheet of Xxxxxx'x as of January 1, 2000 (the
"Recent Balance Sheet"), and the related unaudited statements of
income for the year then ended (including the notes and schedules
contained therein or annexed thereto). All of the financial
statements referred to in (i) and (ii) above (including all notes
and schedules contained therein or annexed thereto) have been
prepared in accordance with generally accepted accounting
principles (except, in the case of unaudited statements, for the
absence of footnote disclosure) applied on a consistent basis,
have been prepared in accordance with the books and records of
Xxxxxx'x and fairly present, in accordance with generally
accepted accounting principles, the assets, liabilities and
financial position, the results of operations and cash flows of
Xxxxxx'x as of the dates and for the years indicated.
(f) Claims, Legal Actions. There is no claim, legal
action, counterclaim, suit, arbitration, governmental
investigation or other legal, administrative or tax proceeding,
nor any order, decree or judgment in progress or pending, or to
the knowledge of Xxxxxx'x, threatened against or relating to
Xxxxxx'x that would have a Material Adverse Effect on Xxxxxx'x,
or on the transactions contemplated by this Agreement, nor does
Xxxxxx'x know of any basis for the same. There are no
applications, complaints or proceedings pending or, to the
knowledge of Xxxxxx'x, threatened before any federal, state or
local agency involving environmental issues relating to Xxxxxx'x
under any federal, state or local environmental law or regulation
which, if concluded adversely to Xxxxxx'x, would have a Material
Adverse Effect on Xxxxxx'x. No order, writ, injunction or decree
is in effect or, to the knowledge of Xxxxxx'x, is threatened with
respect to Xxxxxx'x which would have a Material Adverse Effect on
Xxxxxx'x.
(g) Disclosure. To the knowledge of Xxxxxx'x, no
representation or warranty by Xxxxxx'x in this Agreement, nor any
statement, certificate, schedule, document or exhibit hereto
furnished or to be furnished by or on behalf of Xxxxxx'x pursuant
to this Agreement or in connection with the transactions
contemplated hereby, contains or shall contain any untrue
statement of material fact or omits or shall omit a material fact
necessary to make the statements contained therein not
misleading.
8. CONDUCT OF BUSINESS PRIOR TO CLOSING. Seller covenants
and agrees that from the date of this Agreement to the Effective
Time, except with the prior written consent of Xxxxxx'x or as
otherwise specifically provided for by this Agreement, Seller
shall, with respect to the Store and the Business:
(a) carry on the Business in the normal and ordinary
course in a manner consistent with the manner in which the
Business has heretofore been conducted (including but not limited
to maintaining the Store and all leasehold improvements and
equipment contained therein in good condition, repair and working
order, ordinary wear and tear excepted);
(b) not enter into any material contract (other than
for purchases of inventory and supplies in the usual and ordinary
course of business upon terms consistent with past practices);
(c) not encumber any of the Purchased Assets or enter
into any transaction or make any commitment relating to the
Purchased Assets or the Business, other than in the usual and
ordinary course of business;
(d) not hire any additional employees (except in the
ordinary course of business and consistent with past practices)
or grant any increase in the salaries or rates of pay of any
employee (except for normal periodic merit or seniority increases
under existing agreements or established policies and practices
of Seller and consistent in amount and timing with Seller's prior
practices), establish any new retirement or fringe benefit plan
or grant any increase in benefits under any existing plan;
(e) maintain all of its property, casualty, liability
and other insurance in effect as of the date hereof; and
(f) promptly pay when and as due all taxes, license
fees, charges, franchises and contributions required to be paid
by Seller to governmental agencies or taxing authorities, with
respect to the operation of the Business, except where payment or
the amount thereof is being contested in good faith in
appropriate proceedings and adequate reserves therefor have been
established.
9. CONDITIONS TO OBLIGATIONS OF BUYER AND XXXXXX'X. Buyer
and Xxxxxx'x obligation to purchase the Purchased Assets under
this Agreement shall be subject to the satisfaction, at or before
the Closing, of each of the following conditions, unless waived
in writing by Xxxxxx'x:
(a) Representations and Warranties True. Each and
every representation and warranty of Seller contained in Section
6 hereof, and in each certificate and other document delivered or
to be delivered by Seller or its representatives pursuant hereto
or in connection with the transactions contemplated hereby, shall
be true and accurate in all material respects as of the date when
made and as of the Effective Time and the Closing Date as though
such representation and warranty were made by Seller on the
Closing Date.
(b) Performance. Seller shall have performed and
complied in all material respects with each and every covenant,
obligation and condition required by this Agreement to be
performed or complied with by it at or prior to the Closing.
(c) No Proceedings or Litigation. As of the Closing,
no suit, action, investigation, inquiry or other proceeding by or
before any court or governmental body or other regulatory or
administrative agency or commission shall be threatened,
instituted or pending which questions the validity or legality of
this Agreement or the consummation of the transactions
contemplated hereby which in the written opinion of Buyer's
counsel would make it imprudent to proceed with the transactions
contemplated hereby.
(d) No Injunction. As of the Closing, there shall not
be any effective injunction, writ, preliminary restraining order
or any order of any nature issued by a court, governmental or
regulatory agency directing that the transactions provided for
herein or any of them not be consummated as so provided or
imposing any condition on the consummation of any of the
transactions contemplated hereby.
(e) No Material Adverse Change. There shall have been
no material adverse change in the financial condition, results of
operations, cash flows, assets, liabilities, business or
operations of the Business during the period between January 2,
1999 and the Closing Date.
(f) Closing of Mega Marts Transaction. The
transactions that are the subject of the Stock Purchase Agreement
shall have been closed, contemporaneously with the Closing under
this Agreement.
(g) Consents, Approvals, Permits, Etc. All consents,
authorizations, approvals, exemptions, licenses or permits of, or
registrations, qualifications, declarations or filings with any
governmental body or agency thereof that are required in
connection with the sale and transfer of the Purchased Assets to
the Buyer pursuant to this Agreement and the consummation of the
transactions contemplated hereby and are identified on Section
9(g) of the Disclosure Schedule shall have been duly obtained or
made in form and substance reasonably satisfactory to the Buyer
and its counsel and shall be effective at and as of the Closing
Date.
(h) Permits, Licenses. Buyer shall have received all
necessary permits, licenses, consents, approvals and the like
from third parties and governmental and administrative agencies
necessary for Buyer's conduct of the Business as presently
conducted, except those the absence of which would not have a
Material Adverse Effect.
(i) Termination and Release Agreement. Xxxxxx'x,
Seller and the Mega Shareholders shall have entered into an
agreement among them, in form and substance satisfactory to them
and their respective counsel, whereby all agreements (including
the "Pick `N Save" trademark license and supply agreements)
entered into between the parties (or their affiliates) prior to
the date hereof (the "Existing Agreements") are terminated and
the parties mutually release each other from and against any and
all claims, demands, causes of action, liabilities, costs,
expenses, or obligations (other than those arising out of this
Agreement) that any party may have against any other arising out
of or relating to the Existing Agreements or the business
relationships existing between the parties (the "Termination and
Release Agreement").
(j) Deliveries at or Prior to Closing. Seller shall
have delivered or caused to be delivered to Xxxxxx'x the
following at or prior to the Closing, all in form and substance
reasonably satisfactory to Xxxxxx'x counsel:
(i) Copies of resolutions of Seller's Board of
Directors and its shareholders authorizing the execution,
delivery and performance by Seller of this Agreement and the
consummation by Seller of the transactions contemplated
hereby, and authorizing Seller's officers, employees and
agents to carry out and perform the terms and provisions
hereof and thereof, certified by the corporate secretary of
Seller;
(ii) a closing certificate from the President or a
Vice President of Seller certifying the fulfillment of the
conditions set forth in this Section;
(iii) a certificate of status of Seller issued
by the Department of Financial Institutions of the State of
Wisconsin, dated not more than twenty (20) days prior to the
Closing Date;
(iv) The written consents of all parties that are
required for the assignment by Seller to Buyer of the
Assigned Contracts;
(v) The New Lease duly executed by Seller;
(vi) the written opinion of Xxxxxxx & Xxxx,
S.C., counsel for Seller, dated the Closing Date, in form
and substance reasonably acceptable to Xxxxxx'x;
(vii) All other instruments and documents
required by this Agreement to be delivered by Seller to
Buyer, and such other instruments and documents which Buyer
or its counsel may reasonably request not inconsistent with
the provisions hereof so as to effectively transfer to Buyer
all of Seller's right, title and interest in and to the
Purchased Assets as provided by this Agreement, including,
without limitation:
(A) a warranty xxxx of sale for the Purchased Assets;
(B) an assignment of the Assigned Contracts; and
(C) assignments of the Intellectual Property.
10. CONDITIONS TO OBLIGATIONS OF SELLER. Each and every
obligation of Seller under this Agreement (other than those
contained in Section 8) to be performed at or before the Closing
shall be subject to the satisfaction, at or before the Closing,
of each of the following conditions, unless waived in writing by
Seller:
(a) Representations and Warranties True. Each and
every representation and warranty of Xxxxxx'x contained in
Section 7 hereof, and in each certificate and other document
delivered or to be delivered by Xxxxxx'x or its representatives
pursuant hereto or in connection with the transactions
contemplated hereby, shall be true and accurate in all material
respects as of the date when made and as of the Closing Date as
though such representation and warranty were made by Xxxxxx'x on
the Closing Date.
(b) Performance. Xxxxxx'x shall have performed and
complied with each and every covenant, obligation and material
condition required by this Agreement to be performed or complied
with by it at or prior to the Closing.
(c) No Proceedings or Litigation. As of the Closing,
no suit, action, investigation, inquiry or other proceeding by or
before any court or governmental body or other regulatory or
administrative agency or commission shall be threatened,
instituted or pending which questions the validity or legality of
this Agreement or the consummation of the transactions
contemplated hereby which in the written opinion of Seller's
counsel would make it imprudent to proceed with the transactions
contemplated hereby.
(d) No Injunction. As of the Closing Date, there
shall not be any effective injunction, writ, preliminary
restraining order or any order of any nature issued by a court,
governmental or regulatory agency directing that the transactions
provided for herein or any of them not be consummated as so
provided or imposing any condition on the consummation of any of
the transactions contemplated hereby.
(e) Consents, Approvals, Permits, Etc. All consents,
authorizations, approvals, exemptions, licenses or permits of, or
registrations, qualifications, declarations or filings with, any
governmental body or agency thereof that are required in
connection with the sale and transfer of the Purchased Assets to
the Buyer pursuant to this Agreement and the consummation of the
transactions contemplated hereby shall have been duly obtained or
made in form and substance reasonably satisfactory to the Seller
and its counsel and shall be effective at and as of the Closing
Date.
(f) Closing of Mega Marts Transaction. The
transactions that are the subject of the Mega Marts Stock
Purchase Agreement shall have been closed, contemporaneously with
the Closing under this Agreement.
(g) Deliveries at Closing. Buyer shall have delivered
to Seller at the Closing:
(i) that portion of the Purchase Price payable at
the Closing;
(ii) the Termination and Release Agreement duly
executed by Buyer and Xxxxxx'x, as appropriate;
(iii) a closing certificate from the President
or a Vice President of Buyer and Xxxxxx'x certifying the
fulfillment of the conditions set forth in this Section 10;
and
(iv) The New Lease duly executed by Jondex Corp.
11. PRORATIONS and ACCRUALS.
(a) Personal property taxes applicable to the
Purchased Assets for the year (or other period) in which the
Effective Time occurs shall be prorated as of the Effective Time
on the basis of the personal property tax bills for the year
1999. Utility charges for the billing periods in which the
Closing occurs will be apportioned between Buyer and Seller based
on actual meter readings as of the Effective Time.
(b) Buyer will be entitled to a credit against the
Purchase Price for (i) the amount of all accrued but unpaid
employee bonuses, vacation and holiday pay due as of the
Effective Time to all employees of the Store hired by Buyer
("Transferred Employees"), (ii) the liability of Seller to make
the Accrued Retirement Plan Contributions for the Transferred
Employees assumed by Buyer under Section 1(d), in an amount
determined as provided in that Section, and (iii) the amount of
Tenant Receivables Liability assumed by Buyer under Section 1(d).
For purposes of this Section 11(b), accrued employee bonuses,
vacation and holiday pay for which Buyer will be entitled to a
credit will be determined in accordance with GAAP, provided that
in making such determination for purposes of this subsection
(iii) accrued employee vacation and holiday pay will include that
which each Transferred Employee has earned but not used as of the
Closing Date, as well as a pro-rata portion of that which each
Transferred Employee has accrued through the Closing Date, even
though such employee may not be entitled thereto unless he or she
would have remained employed by the Seller for some additional
time after the Closing Date, and the gross amount so determined
will be reduced by the amount of accrued vacation pay that
Transferred Employees will be assumed to forfeit, at a forfeiture
rate consistent with the Business's past experience.
(c) All costs and charges payable by or to Seller
under any Assigned Contracts will be prorated as of the Effective
Time.
12. NONCOMPETITION.
(a) Seller hereby covenants and agrees with Xxxxxx'x
that during the five (5) year period following the Closing (the
"Restricted Period"), it will not, directly or indirectly, as a
principal, agent, owner, trustee, beneficiary, distributor,
partner, co-venturer, shareholder or in any other capacity:
(i) subject to subparagraphs (b)(ii) and (iii)
below, own, operate, manage, join, finance, control,
participate in the ownership, management, operation or
control of, or acquire any securities of, or otherwise
become associated with or provide assistance to any entity,
business, activity or enterprise (other than Xxxxxx'x and
its subsidiaries and affiliates, collectively referred to
hereinafter as the "Xxxxxx'x Entities") which is engaged in
the business of owning or operating one or more retail
grocery stores having a total selling space (in any one
store) of more than 10,000 square feet (a "Competing
Business") anywhere within the State of Wisconsin;
(ii) subject to subparagraphs (b)(ii) and (iii)
below, own, operate, manage, join, finance, control,
participate in the ownership, management, operation or
control of, or acquire any securities of, or otherwise
become associated with or provide assistance to any entity,
firm, business, activity or enterprise (other than any of
the Xxxxxx'x Entities) which is engaged in the business of
owning or investing in real property that is leased to or
otherwise occupied by a Competing Business (other than any
of the Xxxxxx'x Entities) anywhere within the State of
Wisconsin (a "Competing Real Estate Business"); or
(iii) solicit or seek to cause any salaried
employee of any of the Xxxxxx'x Entities (including Buyer)
to terminate, curtail or otherwise modify his or her
employment relationship with any of the Xxxxxx'x Entities
for the purpose of entering into an employment or other
relationship with Seller or with any entity, firm, business,
activity or enterprise with which Seller is directly or
indirectly affiliated, for the purpose of conducting a
Competing Business or a Competing Real Estate Business.
(b) Notwithstanding the provisions of Section 12(a)
hereof:
(i) Seller may acquire securities of any entity
engaged in a Competing Business the securities of which are
publicly traded, provided that the value of the securities
of such entity held directly or indirectly by such Seller
immediately following such acquisition is less than 5% of
the total value of the then outstanding class or type of
securities acquired;
(ii) Seller's interest in a Competing Real Estate
Business shall not be deemed a breach or violation of
Section 12(a) of this Agreement to the extent that the real
estate owned by such business (A) is leased by such
Competing Real Estate Business to any of the Xxxxxx'x
Entities, (B) consists of the parcel of real estate owned by
the Seller as the Closing Date at Calumet Avenue and Xxxxx
Street in Manitowoc, Wisconsin, or (C) was leased by such
Competing Real Estate Business to any of the Xxxxxx'x
Entities at any time after the Effective Date and such lease
was terminated either by the lessee, by the lessor as a
result of a default thereunder by the lessee, or by the
expiration of its term; and
(iii) Seller may develop and lease the
property currently owned by it at South 00xx Xxxxxx xxx Xxxx
Xxxx, Xxxxxxxxx, Xxxxxxxxx (the "27th Street Property"), to
a Competing Business other than a Xxxxxx'x Entity, provided
that, before entering into any such transaction with a
Competing Business other than a Xxxxxx'x Entity Seller first
provides Xxxxxx'x with notice thereof. Thereafter, Seller
and Xxxxxx'x agree to negotiate in good faith for a period
of fifteen days for the purpose of determining whether one
of the Xxxxxx'x Entities has a bona fide, good faith
interest in leasing or purchasing the 00xx Xxxxxx Property.
If on the basis of such negotiations Seller determines in
its good faith judgment that Xxxxxx'x does not have a bona
fide interest in purchasing or leasing the 00xx Xxxxxx
Property on terms that are likely to result in an agreement
between Seller and Xxxxxx'x to that effect, then Seller may
develop, sell and or lease the 00xx Xxxxxx Property to a
Competing Business. If on the basis of such negotiations
Seller determines in its good faith judgment that Xxxxxx'x
does have a bona fide interest in purchasing or leasing the
00xx Xxxxxx Property on terms that are likely to result in
an agreement between Seller and Xxxxxx'x to that effect,
then Seller agrees to negotiate in good faith with Xxxxxx'x
for an additional thirty day period toward a definitive
agreement for such lease or sale. If at the end of such
thirty day period Seller and a Xxxxxx'x Entity have not
reached a definitive agreement with respect to such lease or
sale, then Seller may develop, sell or lease the 00xx Xxxxxx
Property to a Competing Business.
(c) Seller acknowledges and agrees that the
restrictions set forth in this Section 12 are founded on valuable
consideration and are reasonable in duration and geographic area
in view of the circumstances under which this Agreement is
executed and that such restrictions are necessary to protect the
legitimate interests of Xxxxxx'x. In the event that any
provision of this Section 12 is determined to be invalid by any
court of competent jurisdiction, the provisions of this Section
12 shall be deemed to have been amended and the parties will
execute any documents and take whatever action is necessary to
evidence such amendment, so as to eliminate or modify any such
invalid provision and to carry out the intent of this Section 12
so to render the terms of this Section 12 enforceable in all
respects as so modified.
(d) Seller acknowledges and agrees that irreparable
injury will result to Xxxxxx'x in the event Seller breaches any
covenant contained in this Section 12 and that the remedy at law
for such breach will be inadequate. Therefore, if Seller engages
or threatens to engage in any act in violation of the provisions
of this Section 12, Xxxxxx'x shall be entitled, in addition to
such other remedies and damages as may be available to it by law
or under this Agreement, to injunctive or other equitable relief
to enforce the provisions of this Section 12.
13. FURTHER ASSURANCES; BOOKS AND RECORDS.
(a) From time to time after the Closing, Seller shall,
without cost to Buyer, execute and deliver to or cause to be
executed and delivered to Buyer such other and further transfer
documents and instruments, and take such other action as Buyer
may reasonably request to carry out more effectively the sale of
the Purchased Assets contemplated by this Agreement and to
protect Buyer's right, title and interest in and enjoyment of the
Purchased Assets and the Business.
(b) Following the Closing, for a period of five (5)
years, Seller will preserve those of its books, records, files
and other materials which are not part of the Purchased Assets
hereunder but that relate to the operation of the Store and/or
the Purchased Assets, and will make the same available to Buyer,
during reasonable times and upon reasonable advance notice, for
Buyer's inspection and copying, for purposes reasonably related
to Buyer's operation of the Business and/or ownership of the
Purchased Assets.
(c) Buyer shall permit authorized representatives of
Seller, at all reasonable times after the Closing, access to its
records and accounts which relate to the Business and the Store
for time periods prior to the Effective Time, for the purpose of
obtaining any information necessary or desirable for the
preparation and filing of any tax returns or other reports to any
governmental agency for any period or for any other purpose
reasonably related to the rights or obligations of the parties
under this Agreement. Without limiting the generality of the
foregoing, Buyer will furnish reasonable assistance to Seller in
matters which pertain to accounts receivable, liabilities,
obligations and contract or other rights and obligations retained
by the Seller and not acquired or assumed by Buyer. If the
Seller believes that information with respect to claims or
liabilities asserted by or against the Seller is, or may be,
available from records or other Purchased Assets acquired by
Buyer or from former employees of Seller who have entered Buyer's
employment, such cooperation will include, among other things,
giving Seller the opportunity to inspect records and to consult
with such employees, permitting Seller, after consultation with
Buyer, to copy the records and giving such employees reasonable
leave during working hours to meet with representatives of
Seller, to furnish testimony or render other assistance to
Seller.
14. EMPLOYEES.
(a) Termination and Hiring. Seller shall terminate
all of the employees employed by it at the Store immediately
prior to the Effective Time. Buyer will offer reasonably
equivalent employment to all of the Store level employees of
Seller ("Store Employees"). Seller acknowledges that Buyer
intends to hire none of the corporate office employees and other
non-store level employees of Seller, and agrees that Seller will
be solely responsible for (and indemnify Buyer against) any
liability under any plant closing or similar law (including the
Worker Adjustment and Retraining Notification Act, 29 U.S.C.
Section 2101, et. seq., and its Wisconsin counterpart) that may
arise as a result of the failure of Buyer to hire any such
corporate officer and non-store level employees or the
termination of their employment by Seller. The employees of
Seller hired by Buyer as of the Closing Date are referred to
herein as "Transferred Employees."
(b) Health Insurance. Contemporaneously with the
Closing, the Transferred Employees will become participants in
Buyer's employee group health insurance coverage, with no waiting
period, no interruption in coverage and no exclusion for prior
existing conditions.
(c) Retirement Plans. Effective as of the Closing
Date, the Seller shall cause the separate accounts of all
Transferred Employees under the Seller's Profit Sharing and
401(k) Retirement Savings Plan (the "Seller's Plan") to be
segregated from the other accounts of the Seller's Plan and
transferred by a plan-to-plan transfer of all assets and
liabilities of the separate accounts of all Transferred Employees
to the Mega Marts, Inc. Profit Sharing 401(k) Plan ("Buyer's
Plan") as soon as practicable after the Closing Date. The
Seller, Xxxxxx'x and the Buyer agree to cooperate in the transfer
of the Seller's Plan assets to Buyer's Plan, so that such
transfer shall comply with Sections 401(a)(12) and 414(1) of the
Code and that thereafter each Transferred Employee will have an
account balance in Buyer's Plan equal to his or her account
balance in the NDC Plan immediately before the transfer of
assets.
15. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; INDEMNITY.
(a) Survival. All representations and warranties of a
party contained in this Agreement or in any certificate or other
document delivered pursuant hereto shall survive the Closing Date
(regardless of any investigation by the other party to this
Agreement) for a period of fifteen (15) months following the
Closing, except for the representations and warranties contained
in Subsections 6(a), (b), (c), and (h)(i), and Subsections 7(a),
(b) (c) and (e) which shall survive indefinitely, and those
contained in Subsection 6(g) which shall survive until the
expiration of the applicable statutes of limitations (the period
of survival of any representation or warranty being referred to
as its "Survival Period").
(b) General. From and after the Closing, the parties
shall indemnify each other as provided in this Section 15. The
party seeking indemnification is sometimes referred to herein as
the "Indemnified Party" and the party from which indemnification
is sought is sometimes referred to as the "Indemnifying Party."
The remedies provided in this Section 15 shall be cumulative and
shall not preclude the assertion by either party hereto of any
other rights or the seeking of any other remedies against the
other party hereto.
(c) Seller's Indemnification Covenants. Seller will
indemnify Buyer and Xxxxxx'x and their affiliates and hold them
harmless from and against any and all liabilities, demands,
claims, suits, proceedings, actions or causes of action,
assessments, losses, penalties, costs, damages and expenses,
including reasonable attorneys' and expert witness fees
(collectively, "Damages"), sustained or incurred by Buyer or
Xxxxxx'x or their affiliates as a result of, arising out of or
incidental to:
(i) any breach or inaccuracy of any
representation or warranty made by Seller in this Agreement
or in any certificate or other document or instrument
delivered by Seller to Buyer or Xxxxxx'x in connection with
the transactions contemplated hereby;
(ii) any failure of Seller to comply with, or any
breach or nonfulfillment by Seller of, any covenant of
Seller set forth in this Agreement or in any certificate or
other document or instrument delivered by Seller to Buyer or
Xxxxxx'x in connection with the transactions contemplated
hereby;
(iii) any failure of Seller to timely pay,
perform or discharge when due any liability or obligation of
Seller (including, without limitation, any tax liabilities),
except for the Contract Liabilities and Assumed Employee
Accruals expressly assumed by Buyer hereunder;
(iv) any failure of Seller to comply with the
requirements of any bulk sales or bulk transfer law; and
(v) any act or omission of Seller occurring prior
to the Effective Time.
(d) Buyer's Indemnification Covenants. Buyer and
Xxxxxx'x, jointly and severally, will indemnify Seller for and
hold it harmless from and against any and all liabilities,
demands, claims, suits, proceedings, actions or causes of action,
assessments, losses, penalties, costs, damages and expenses,
including reasonable attorneys' and expert witness fees
(collectively, "Damages"), sustained or incurred by Seller as a
result of, arising out of or incidental to:
(i) any breach or inaccuracy of any
representation or warranty made by Buyer or Xxxxxx'x in this
Agreement or in any certificate or other document or
instrument delivered by Buyer or Xxxxxx'x to Seller in
connection with the transactions contemplated hereby;
(ii) any failure of Buyer or Xxxxxx'x to comply
with, or any breach or nonfulfillment by Buyer or Xxxxxx'x
of any covenant of Buyer or Xxxxxx'x set forth in this
Agreement or in any certificate or other document or
instrument delivered by Buyer or Xxxxxx'x to Seller in
connection with the transactions contemplated hereby; or
(iii) any failure of Buyer to timely pay,
perform or discharge any of the liabilities of Seller
expressly assumed by Buyer hereunder.
(iv) any and all liabilities arising after the
Effective Time and attributable to Buyer's conduct of the
Business after the Effective Time.
(e) Claims for Indemnification.
(i) Promptly upon an Indemnified Party's
obtaining knowledge of any facts causing it to believe that
it has or will have a claim for indemnification against any
Indemnifying Party or Parties hereunder, the Indemnified
Party shall give written notice of such claim to the
Indemnifying Party or Parties. Such written notice shall
set forth the nature and (to the extent then known) the
amount of Damages incurred by or threatened against the
Indemnified Party. Notwithstanding the foregoing, the right
of indemnification hereunder shall not be affected by any
failure of the Indemnified Party to give or by its delay in
giving such notice unless, and then only to the extent that,
the rights of the Indemnifying Party are prejudiced as a
result of such failure or delay.
(ii) The Indemnified Party shall tender to the
Indemnifying Party the defense of any claim, suit,
proceeding, action or assessment brought by any third party
(hereinafter "Third Party Claim"). Failure by the
Indemnifying Party to notify the Indemnified Party of its
election to defend any such Third Party Claim within ten
(10) days after the Indemnified Party's notice to the
Indemnifying Party of the same shall be deemed a waiver by
the Indemnifying Party of its right so to defend. If the
Indemnifying Party assumes such defense, the obligations of
the Indemnifying Party hereunder as to such Third Party
Claim shall include taking all steps reasonably necessary in
the defense or settlement thereof and holding the
Indemnified Party harmless from and against any and all
Damages sustained or incurred by the Indemnified Party which
result from, arise out of or are incidental to any
settlement approved by the Indemnifying Party or any
judgment in connection therewith. Legal counsel engaged by
the Indemnifying Party to defend such claim shall be
reasonably acceptable to the Indemnified Party. Except with
the written consent of the Indemnified Party, the
Indemnifying Party, in the defense of any such Third Party
Claim, shall not consent to the entry of any judgment
against or adversely affecting the Indemnified Party (other
than a judgment of dismissal on the merits and without
costs) or enter into any settlement unless such settlement
provides that the Indemnified Party is fully released by the
third party as to such Third Party Claim.
(iii) If the Indemnifying Party does not
assume the defense of any such Third Party Claim as provided
herein, the Indemnified Party may defend against such Third
Party Claim in such manner as the Indemnified Party deems
advisable or appropriate and may settle such Third Party
Claim or consent to the entry of judgment with respect
thereto upon such terms as it deems advisable or
appropriate, and in such event the Indemnifying Party shall
promptly reimburse the Indemnified Party for the amount of
such settlement or judgment and for any and all Damages
sustained or incurred by the Indemnified Party which result
from, arise out of or are incidental to the defense or
settlement of such Third Party Claim.
(f) Time Limitations on Claims. An Indemnified Party
shall not be entitled to indemnification pursuant to this Section
15 with respect to any claim for indemnification under
subparagraph 15(c)(i) or Subparagraph 15(d)(i) unless written
notice of such claim is given by the Indemnified Party to the
Indemnifying Party within the applicable Survival Period.
(g) Indemnification Threshold and Cap.
Notwithstanding anything to the contrary herein and except as
provided in Section 15(h): (i) any claim by an Indemnified Party
against any Indemnifying Party under Sections 15(c)(i) or
15(d)(i) shall be payable by the Indemnifying Party only in the
event and to the extent that the accumulated amount of all claims
against such Indemnifying Party shall exceed the amount of Eighty
One Thousand Dollars ($81,000) in the aggregate (the
"Indemnification Threshold"); and (ii) the maximum amount for
which an Indemnifying Party shall be obligated to provide
indemnification hereunder shall not exceed Two Million Dollars
($2,000,000) (the "Indemnification Cap"). In applying the
Indemnification Threshold and the Indemnification Cap, Buyer and
Xxxxxx'x, on the one hand, and Seller, on the other hand, shall
be considered to be one "Indemnifying Party." At such time as
the aggregate amount of claims against an Indemnifying Party
shall exceed the Indemnification Threshold, such party shall
thereafter be liable on a dollar-for-dollar basis for the full
amount of all further claims beyond the Indemnification
Threshold, subject to the Indemnification Cap.
(h) Zero-Threshold Claims. Notwithstanding the
preceding Section 15(g), the following categories of claims for
indemnification ("Zero-Threshold Claims") shall not be subject to
the Indemnification Threshold or the Indemnification Cap, but
shall be payable on a dollar-for-dollar basis without any
exclusion therefor or limitation thereon:
(i) any claims related to a breach of the
representations and warranties contained in Subsections
6(a), (b), (c), (h)(i), and (g) or Subsections 7(a), (b) and
(c);
(ii) any claims by either party against the other
for payment or return of the Purchase Price or any portion
thereof, including any adjustments to the Purchase Price
payable under Section 4 or 5 hereof.
(i) Tax Effect of Losses; Insurance. In determining
the amount of any indemnification claim for purposes of this
Section 15 there shall be taken into account any income or other
Tax benefit which the Indemnified Party may actually have
received or be entitled to receive (if in the future, at its
present value) as a result of the Damages forming the basis of
such claim, and there shall also be taken into account any income
or other Tax cost which the Indemnified Party would incur as a
result of its receipt of any indemnification payment from the
Indemnifying Party (including any such indemnification payment
which the Indemnified Party would be entitled to receive but for
the provisions of Section 15(g)).
(j) Exclusive Remedy. The parties agree that, except
as expressly provided herein, and except for claims for
injunctive relief to enforce specifically the provisions of this
Agreement, the rights of indemnification provided in this Section
15 shall be the sole and exclusive remedies of Buyer, Xxxxxx'x
and Seller for any claim or cause of action arising out of or
relating to the negotiation, execution, delivery, performance or
breach of this Agreement (whether such claim or cause of action
is based on breach of contract, misrepresentation, tort,
violation of statute (including, but not limited to,
Environmental Laws and securities laws and regulations) or
otherwise).
16. COUPONS. Buyer will not acquire hereunder any of the
rights of Seller to be reimbursed for any coupons accepted by
Seller from customers prior to the Effective Time, and Buyer does
not assume hereunder (and Seller will hold Buyer harmless from)
any liability of Seller relating to such coupons or the Seller's
acceptance thereof.
17. MISCELLANEOUS PROVISIONS.
(a) Seller's Transfer of This Agreement to its LLC.
At the Closing, Seller intends to transfer this Agreement and
substantially all of its other assets (except the tangible and
intangible assets of the Tri City True Value Hardware Store and
vehicles) to the Seller's LLC, and thereafter liquidate and
dissolve, transferring ownership of the Seller's LLC to the NDC
Shareholders. In consideration of Xxxxxx'x and Buyer's
willingness to permit such assignment and liquidation without
requiring the NDC Shareholders personally to become parties to
this Agreement or guaranty the obligations of Seller hereunder,
Seller represents, warrants and covenants as follows:
(i) At the Closing, Seller will cause Seller's
LLC to execute and deliver to Xxxxxx'x and Buyer an
assumption of the obligations of the Seller hereunder, in
form and substance reasonably satisfactory to Xxxxxx'x;
(ii) Seller represents and warrants that the pro
forma balance sheet of Seller's LLC that has been provided
to Xxxxxx'x and Buyer ("Pro Forma Balance Sheet") fairly
reflects in all material respects the assets, liabilities
and financial condition of Seller's LLC as the same will
exist immediately following the transactions contemplated by
this Agreement and the susbsequent liquidation of Seller
(the values of the assets of Seller's LLC indicated thereon
being based on their current book value on Seller's books);
(iii) as of the Closing Date, the NDC
Shareholders have no present plan or intention to liquidate
or dissolve Seller's LLC or otherwise transfer any
substantial portion of the assets reflected on the Pro Forma
Balance Sheet to the NDC Shareholders or to any other entity
owned or controlled by the NDC Shareholders, in such a
manner as to diminish materially the net assets of Seller's
LLC.
(b) Waiver of Compliance. Any failure by any of the
parties hereto to comply with any obligation, covenant or
agreement or to fulfill any condition herein may be waived only
by a written notice from the party entitled to the benefits
thereof. No failure by any party hereto to exercise, and no
delay in exercising, any right hereunder, shall operate as a
waiver thereof, nor shall any single or partial exercise of any
right hereunder preclude any other or future exercise of that
right or any other right hereunder by that party.
(c) Notices. Subject to Section 17(m)(ii) below, all
notices and other communications required or permitted hereunder
shall be deemed given if given in writing and delivered
personally, by commercial delivery service, by courier or by
facsimile transmission, telexed or mailed by registered or
certified mail (return receipt requested) fax, telex or postage
fees prepaid, to the party to receive the same at its respective
address set forth below, or at such other address as may from
time to time be designated by such party to the others in
accordance with this Section 17(c) (provided, that written notice
given in any other manner shall nonetheless be effective upon its
actual receipt by the party entitled to receive it):
If to the Seller, to:
NDC, Inc.
0000 Xxxxx 00xx Xxxxxx
Xxx Xxxxx, XX 00000
Attention:
with copies to: Xxxxx & Xxxxxxx
000 X. Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx
Facsimile: (000) 000-0000
and to: Xxxxxxx & Xxxx, S.C.
000 X. Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxxxxxxx Xxxxx
Facsimile: (000) 000-0000
If to the Buyer or
to Xxxxxx'x to: Xxxxxx'x, Inc.
00000 Xxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention:
Xxxxxx X. Xxxx, Vice President,
Secretary and Treasurer
Facsimile: (000)000-0000
with a copy to:
Xxxxx Xxxxxxxxxxx Xxxxx S.C.
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxx
Facsimile: (000) 000-0000
All such notices and communications hereunder shall be
deemed given when received, as evidenced by the acknowledgment of
receipt issued with respect thereto by the applicable postal
authorities or the signed acknowledgment of receipt of the person
to whom such notice or communication shall have been personally
delivered, confirmed answer back or other evidence of
transmission.
(c) Mill Shop. Seller and Buyer each acknowledge and
agree that neither of such parties has any continuing liability
or obligation to the other, whether pursuant to any written or
oral contract, by course of dealing, or otherwise, with respect
to the Seller's business known as the "mill shop." In
particular, Buyer has no continuing obligation to use the
services of the "mill shop," employ any of its personnel, or bear
any of the costs of its operations.
(d) Expenses. Each party hereto shall bear and pay
its own expenses in connection with the negotiation, execution
and delivery of this Agreement and the transactions contemplated
hereby, whether or not the Closing occurs hereunder. Without
limiting the generality of the foregoing, Seller will be solely
responsible for the payment of any fees or commissions due to any
investment banker, financial advisor, attorneys or accountants or
the like retained by Seller.
(e) Public Announcements. No party hereto will issue
any report, statement or release to the general public, to the
trade, to the general or trade press, or to any third party
(other than its advisors and representatives in connection with
the transactions contemplated hereby), relating to this Agreement
and the transactions contemplated hereby, except as may be
mutually agreed by the parties hereto.
(f) Binding Effect; Assignment. This Agreement shall
inure to the benefit of and be binding upon the parties hereto
and their respective successors and permitted assigns. Neither
this Agreement nor any rights, duties or obligations shall be
assigned by any party hereto without the prior hereto written
consent of the other parties, and any attempted assignment or
transfer without such prior written consent shall be null and
void.
(g) No Third Party Beneficiary. Neither this
Agreement nor any provision hereof, nor any statement, schedule,
certificate, instrument or other document delivered or to be
delivered pursuant hereto, nor any agreement entered into or to
be entered into pursuant hereto or any provision thereof, is
intended to create any right, claim or remedy in favor of, or
impose any obligation upon, any person or entity other than the
parties hereto and their respective successors and permitted
assigns.
(h) Captions and Paragraph Headings. Captions and
paragraph headings used herein are for convenience only and are
not intended to be a part of this Agreement and shall not be used
in construing it.
(i) Entire Agreement; Modifications; Severability.
The making, execution and delivery of this Agreement by the
parties hereto has been induced by no representations,
statements, warranties or agreements other than those herein
expressed. This Agreement embodies the entire agreement of the
parties pertaining to the subject matter hereof and supersedes
all prior or contemporaneous agreements or understandings,
written or oral, of the parties relating to the subject matter
hereof. This Agreement may be amended or modified only by an
instrument signed by the parties or their duly authorized agents.
The invalidity, illegality or unenforceability for any reason of
any one or more provisions of this Agreement shall not affect the
validity, legality or enforceability of the remainder of this
Agreement.
(j) Definition of Knowledge. With respect to the
representations and warranties of the Seller set forth herein
which are made subject to the qualification "to the Knowledge of"
the Seller, the Seller shall be deemed to have Knowledge of (i)
any matter, fact, or thing that is, as of the date hereof or the
Closing Date, actually known to any of the President, Chief
Financial Officer, Secretary or any Vice President of Seller (the
latter being referred to collectively as "Seller's Officers");
and (ii) any matter, fact or thing which reasonably should be
known by any of Seller's Officers after "due inquiry" by such
person, taking into account any and all roles or positions which
such person may hold and any and all duties and responsibilities
he or she may have vis-a-vis Seller and the Business; for this
purpose, "due inquiry" shall include (but not necessarily be
limited to) a review of the accounting and financial records and
books of account of Seller; a review of Seller's regularly
maintained files and records relating to its assets, liabilities,
and business; a review of the minute books and stock records of
Seller; a visual inspection of Seller's real property and
tangible personal property; and an inquiry of the attorneys,
accountants, and similar professionals retained or engaged by
Seller at any time within the preceding two (2) years.
(k) Definition of Material Adverse Effect. The term
"Material Adverse Effect" as used in this Agreement shall mean an
effect that is materially adverse to the business, financial
condition or results of operations of Seller (or the Buyer and
its subsidiaries, as the case may be); provided, that any
impairment of Seller's ability to conduct continuously any
material aspect of the Business will be deemed to constitute a
Material Adverse Effect.
(l) Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the
same instrument.
(m) Governing Law . The parties hereby agree that
this Agreement, and the respective rights, duties and obligations
of the parties hereunder, shall be governed by and construed in
accordance with the laws of the State of Wisconsin, without
giving effect to principles of conflicts of law thereunder.
(n) Exclusive Jurisdiction. Each of the parties
hereby (i) irrevocably consents and agrees that any legal or
equitable action or proceeding arising under or in connection
with this Agreement shall be brought exclusively in any Federal
or state court within Milwaukee or Waukesha County, State of
Wisconsin, and any court to which an appeal may be taken in any
such litigation, and (ii) by execution and delivery of this
Agreement, irrevocably submits to and accepts with respect to any
such action or proceeding, for such party's heirs, beneficiaries
remaindermen, personal representatives, executors,
administrators, fiduciaries and permitted assigns and in respect
of such party's properties and assets, generally and
unconditionally, the jurisdiction of the aforesaid courts, and
irrevocably waives any and all rights such party may now or
hereafter have to object to such jurisdiction under the
constitution or laws of the State of Wisconsin or the
Constitution or laws of the United States of America or
otherwise.
(o) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HEREBY
IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO A JURY TRIAL IN
CONNECTION WITH THIS AGREEMENT OR ANY DISPUTE OR CONTROVERSY
HEREUNDER OR THE TRANSACTIONS THAT ARE THE SUBJECT HEREOF.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first written above.
SELLER: BUYER:
NDC, INC. MEGA MARTS, INC.
By: By:
____________________________, ___________________________
_______________, President Xxxxxx X. Xxxx, Vice President
XXXXXX'X:
XXXXXX'X, INC.
By:
___________________________
Xxxxxx X. Xxxx, Vice-President,
Secretary, Treasurer
EXHIBITS
Exhibit 1(e) New Lease
Exhibit 1(e)(i) Landlord's Consent
THE ABOVE-DESCRIBED EXHIBITS AND SCHEDULES, AND THE DISCLOSURE
SCHEDULE TO THIS AGREEMENT, ARE OMITTED FROM THIS FILING PURSUANT
TO ITEM 601(b)(1) OF REGULATION S-K. THE REGISTRANT, XXXXXX'X,INC.,
HEREBY AGREES TO FURNISH A COPY OF SUCH EXHIBITS AND SCHEDULES TO
THE COMMISSION UPON REQUEST.
