EXHIBIT 2.9
AMENDMENT
TO
ASSET PURCHASE AGREEMENT
(General Parts, Inc.)
This AMENDMENT, dated as of October 8, 1998, to Asset Purchase
Agreement, dated as of September 9, 1998, is made and entered into by and among
A.P.S., Inc., a Delaware corporation ("APS"), the Affiliates of APS party hereto
and General Parts, Inc., a North Carolina corporation ("Purchaser").
RECITALS
WHEREAS, the parties hereto have entered into an Asset Purchase
Agreement dated as of September 9, 1998 (the "Asset Purchase Agreement"); and
WHEREAS, such parties desire to amend the Asset Purchase
Agreement as set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE I.
DEFINITIONS
Section 1.1. DEFINITIONS. Capitalized terms used herein that
are defined in the Asset Purchase Agreement are used herein as so defined.
ARTICLE II.
AMENDMENTS
The Asset Purchase Agreement is hereby amended as follows:
(a) Section 1.1 is amended by adding thereto, in appropriate
alphabetical order, the following new definitions:
"Estimated ▇▇▇▇▇ Cash" means the amount of ▇▇▇▇▇ Cash as
estimated by Seller and set forth in a report delivered by Seller to
Purchaser on the Business Day prior to the Closing Date."
"▇▇▇▇▇ Cash" means cash held at the Stores as of the close
of business on the Closing Date."
"RDC Inventory" means New Inventory that has been moved, not
more than 45 days prior to the Closing Date,
from a Closed Location to one of Seller's redistribution centers."
"Rejected Inventory Reserve" means an amount equal to
$450,000."
(b) The definition of the term "Accounts Receivable" contained in
Section 1.1 is amended by (i) deleting the word "or" appearing at the end of
clause (i) thereof and replacing it with a comma and (ii) adding immediately
after such clause (ii) the following:
"or (iii) the obligors on which are the persons identified in
a letter delivered by Seller to Purchaser with respect to this
clause (iii)".
(c) The definition of the term "Other Asset Purchase Agreement"
contained in Section 1.1 is amended in its entirety to read as follows:
"Other Asset Purchase Agreement" means the Asset
Purchase Agreement dated as of September 9, 1998, as amended
by an Amendment dated as of October 8, 1998, between Seller
and BWP."
(d) The definition of the term "Purchased Assets" contained in
Section 1.1 is amended by (i) deleting the word "and" appearing at the end of
item (j) thereof; (ii) deleting the period appearing at the end of item (k)
thereof and replacing it with a semi-colon and the word "and"; and (iii) adding
thereto the following new item (l):
"(l) the ▇▇▇▇▇ Cash.".
(e) The definition of the term "True-Up Date" contained in Section
1.1 is amended in its entirety to read as follows:
"True-Up Date" means the date which is ninety
(90) days after the Closing Date."
(f) Section 2.4(a) is amended by (i) amending item (ii) thereof in
its entirety to read as follows:
"(ii) an amount equal to the value realized by Purchaser for
Dirty Core and Warranty Inventory determined in accordance with
actual receipts or credits received less (x) for items in any Store
in excess of 1/2% of the total of all such items in such Store and
(y) for items in any DC in excess of 2% of the total of all such
items in such DC, 20% for handling;";
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(ii) deleting the word "and" appearing at the end of item (vi) thereof; (iii)
deleting the period appearing at the end of item (vii) thereof and replacing it
with a semi-colon; (iv) adding thereto the following new items (viii) and (ix):
"(viii) one hundred percent (100%) of the amount of
the ▇▇▇▇▇ Cash; and
(ix) $400,000 in respect of RDC Inventory.";
and (v) changing the reference to item (vii) in the last sentence thereof to be
a reference to item (ix).
(g) Section 2.4(b) is amended in its entirety to read as follows:
"(b) On the Closing Date, Purchaser shall pay to Seller an
amount of the Purchase Price in cash by wire transfer of
immediately available funds (pursuant to written instructions to be
provided by Seller to Purchaser), or, if requested by Seller, by
delivery of one or more bank cashier's checks, equal to the sum of
the following (less $450,000) (the "CLOSING DATE Payment"):
(i) eighty-five percent (85%) of the Current Inventory
Amount, less the Rejected Inventory Reserve;
(ii) the portions of the Purchase Price provided for in
SECTIONS 2.4(A)(III) and 2.4 (A)(IV);
(iii) an amount equal to sixty-five percent (65%) of the
Estimated Accounts Receivable (determined without regard to AR
Discounts);
(iv) the aggregate price for the Purchased Real
Properties, as provided in SECTION 2.11, and the price for the
Salt Lake City Lease, as provided for in SCHEDULE B;
(v) an amount equal to one hundred percent (100%) of the
Estimated ▇▇▇▇▇ Cash; and
(vi) $400,000 in respect of RDC Inventory.
The Closing Date Payment shall be adjusted pursuant to
SECTIONS 2.5, 2.6 AND 2.7. Purchaser shall pay the remainder
of the Purchase Price pursuant to SECTIONS 2.4(C), 2.4(D),
2.5(B), 2.6(B), 2.7(C), 2.7(D), 2.7(F) AND
2.11.
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Seller and Purchaser agree that if the amount of any bank
cashier's checks delivered pursuant to this Section 2.4(b)
does not equal the Closing Date Payment (because, for example,
the components thereof cannot be or are incorrectly calculated
at the time the checks are issued), they will cooperate to
correct such errors as promptly as possible after the Closing
Date, by arranging for new cashier's checks or wire transfer
in the correct amount."
(h) Section 2.4(d) is amended by adding to the end thereof the
following:
"For purposes of implementing the foregoing provisions, Seller
agrees that Purchaser may, prior to the Closing Date, enter
into agreements with obligors under Notes Receivable providing
for such conversion, provided that (i) such agreements shall
by their terms be effective only if the Closing has occurred
and (ii) Purchaser shall purchase on the Closing Date,
pursuant to Section 2.4(a)(iv), all Notes Receivable of
obligors who have entered into such agreements."
(i) Section 2.5(a) is amended by (i) adding thereto, immediately
after the first sentence thereof, the following:
"The physical inventories required during the Physical
Inventory Period for Stores as set forth on Schedule 2.5(a)
may be performed on a cycle count basis over a period of
several days or, alternatively, as a wall-to-wall count on one
day.";
and (ii) adding to the end thereof the following new paragraph:
"For purposes of the counts and procedures referred to
in the preceding paragraph, if the test count conducted at any
Store indicates a variance (that cannot be reconciled or
explained) from shelf to perpetual inventory record of 5% or
more, the Inventory Representatives of Seller and Purchaser
involved in the test count shall notify ▇▇▇▇▇▇▇ ▇▇▇▇▇, in the
case of Seller, and ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, in the case of Purchaser,
and those individuals shall agree, on behalf of Seller and
Purchaser, on a schedule for the conduct of wall-to-wall
physical inventories for such Store."
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(j) Section 2.5(b) is amended by adding to the end thereof the
following:
"Determinations and calculations made pursuant to this Section
2.5(b) shall be made without duplication of determinations and
calculations made pursuant to Section 2.7(b)."
(k) Section 2.6 is amended by (i) adding to the end of the caption
thereof the following:
"; ▇▇▇▇▇ Cash True-Up.";
and (ii) adding to the end thereof the following new subsection (c):
"(c) Prior to October 30, 1998, Seller and Purchaser shall
cooperate in determining the amount of the ▇▇▇▇▇ Cash. In the event
that the amount of the ▇▇▇▇▇ Cash as so determined is greater than
the amount of the Estimated ▇▇▇▇▇ Cash, Purchase shall pay to
Seller, on the first Business Day after October 30, 1998, the amount
of such excess. In the event that the amount of the Estimated ▇▇▇▇▇
Cash is greater than the amount of the ▇▇▇▇▇ Cash as so determined
pursuant to this Section 2.6(c), Seller shall pay to Purchaser, on
the first Business Day after October 30, 1998, the amount of such
excess."
(l) Section 2.7 is amended by replacing the period at the end of the
caption thereof with a semi-colon and adding to the end of such caption the
following:
"Consigned Goods.".
(m) Section 2.7(b) is amended in its entirety to read as follows:
"(b)(i) From the Closing Date until payment thereof as
provided in Section 2.7(b)(ii), the amount of the Rejected
Inventory Reserve shall be deposited by Purchaser and held in
a bank account (the "Rejected Inventory Account") established
jointly by Seller and Purchaser. Payments from such account
shall be made as provided in Section 2.7(b)(ii).
(ii) As part of the physical inventory counts and
procedures conducted pursuant to Section 2.5(a), Seller and
Purchaser shall, prior to October 30, 1998, prepare a list of
Rejected Inventory, itemized separately for Stores and DCs,
and shall calculate the amount that would have been payable to
Seller
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on the Closing Date pursuant to Section 2.4(b)(i) (without
deduction for the Rejected Inventory Reserve) if the aggregate
dollar amount of such Rejected Inventory had been deducted
from the Current Inventory Amount for purposes of such
payment. If the amount that would have been payable to Seller
on the Closing Date based upon the calculation made pursuant
to the preceding sentence (and without deduction for the
Rejected Inventory Reserve) (the "Adjusted Payment") is
greater than the amount actually paid pursuant to Section
2.4(b)(i) (the "Closing Date Inventory Payment"), Purchaser
shall pay to Seller, on the first Business Day after October
30, 1998, from funds in the Rejected Inventory Account, an
amount equal to the excess of the Adjusted Payment over the
Closing Date Inventory Payment, and the balance, if any, of
the amount held in the Rejected Inventory Account shall be
simultaneously paid to Purchaser. If the Closing Date
Inventory Payment exceeds the Adjusted Payment, the amount
held in the Rejected Inventory Account shall be paid to
Purchaser on the first Business Day after October 30, 1998,
and the excess of the Closing Date Inventory Payment over the
Adjusted Payment shall be paid by Seller to Purchaser on the
first Business Day after the True-Up Date (in addition to any
other amounts payable by Seller on such date pursuant to
Section 2.5).
(iii) Rejected Inventory shall be returned to the
reclamation centers or other facilities as shall be specified
by Seller, at the sole expense of Seller, with shipment of
such Rejected Inventory to take place no later than five (5)
Business Days after October 30, 1998. Purchaser shall be
liable for any loss of or damage to Rejected Inventory prior
to its delivery to such reclamation centers or other
facilities."
(n) Section 2.7 is amended by adding to the end thereof the
following new subsection (f):
"(f) Seller and Purchaser acknowledge that the Current
Inventory Amount does not include the value of any consigned
goods. Prior to October 30, 1998, Seller and Purchaser shall
cooperate in determining the amount of consigned goods and
obtaining written verification of the consignment
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by the consignor, and Purchaser shall give Seller prompt
notice of all verifications so obtained. On the first Business
Day after October 30, 1998, Purchaser shall pay to Seller an
amount equal to 85% of the Warehouse Distributor Cost of New
Inventory consisting of consigned goods as to which the amount
thereof has been determined, and verification obtained, in
accordance with the provisions of the preceding sentence. In
the event that any consigned goods have been sold prior to
payment to Seller therefor pursuant to this Section 2.7(f),
Purchaser shall ▇▇▇▇ such sale and shall pay Seller for such
consigned goods in accordance with the provisions of the
preceding sentence (without regard to any requirement for
verification)."
(o) Section 2.9 is amended by adding to the end of the first
sentence thereof the following:
"and, with respect to the RDC Inventory, by the issuance of a
credit memorandum in the amount of $400,000 for the purchase
of inventory (based upon 85% of Warehouse Distributor Cost)
from one of Seller's redistribution centers."
(p) Section 2.10 is amended by (i) deleting the expression "12:00
midnight on the day preceding the Closing Date" and inserting in lieu thereof
the following:
"11:59 P.M., New York City time, on the Closing Date";
and (ii) adding to the end thereof the following new paragraph:
"Prior to the True-Up Date, Seller and Purchaser shall
determine, based on actual bills or other applicable
documentation, the actual apportionment amounts required by
this Section 2.10. In the event that such actual apportionment
amounts as so determined are greater than the apportionment
amounts paid to Seller on the Closing Date, Purchaser shall
pay to Seller, on the first Business Day after the True-Up
Date, the amount of such excess, and, in the event that the
apportionment amounts paid to Seller on the Closing Date are
greater than such actual apportionment amounts as so
determined, Seller shall pay to Purchaser, on the first
Business Day after the True-Up Date, the amount of such
excess. The provisions of
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this paragraph shall also apply to apportionments pursuant to
Section 10.2."
(q) Exhibit D to the Asset Purchase Agreement is amended by adding
to the end of Section 9 thereof the following:
"Notwithstanding the foregoing, Licensee may grant to
▇▇▇▇▇▇ and Strafco rights to use the Marks upon and subject to
the terms of, and the obligations contained in, this Agreement
(but the Marks may be so used only with respect to the
business conducted at Purchased Locations that are subject to
the Assigned GPI Affiliate Leases and ▇▇▇▇▇▇ Subleases),
provided that such assignment shall not relieve Licensee from
any of its obligations under this Agreement, and Licensee
shall remain liable for any breach of this Agreement by ▇▇▇▇▇▇
or Strafco."
ARTICLE III.
MISCELLANEOUS PROVISIONS
Section 4. COUNTERPARTS. For the convenience of the parties, any
number of counterparts of this Amendment may be executed by any one or more of
the parties hereto, and each such executed counterpart shall be, and shall be
deemed to be, an original, but all of which together shall constitute one and
the same instrument.
Section 5. RATIFICATION. The Asset Purchase Agreement, as
amended hereby, is hereby ratified and confirmed.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument
to be executed to be effective as of the 9th day of October, 1998.
A.P.S. Inc.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
GENERAL PARTS, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title:Vice President of Finance
