ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption Agreement ("Assignment")
is entered into and effective as of September 1, 1996 by and
between INTEK Diversified Corporation ("INTEK") and Midland USA,
Inc. ("MUSA"). Capitalized terms not otherwise defined herein
shall have the meanings ascribed to them in the Amended and
Restated Sale of Assets and Trademark Agreement (the "Agreement")
dated as of September 19, 1996 among INTEK, Xxxxxxxx Capital
Limited and Midland International Corporation. For good and
valuable consideration, receipt and sufficiency of which are
hereby acknowledged, INTEK and MUSA hereby agree as follows:
1. ASSIGNMENT. INTEK hereby assigns and transfers to
MUSA all of its right, title and interest in and to the Acquired
Assets, all of its rights and obligations under the Agreement and
all deposits, payments or advance payments (collectively, the
"Deposits") for product purchase orders identified on Schedule A
hereto, but with respect to the Deposits, such assignment shall
be effective only at such time as MUSA shall pay to INTEK the
Second Payment (as defined below).
2. ASSUMPTION. MUSA hereby accepts such assignment,
expressly assumes the Assumed Liabilities and shall be bound by
all of the terms, covenants and conditions thereof and shall
perform all obligations thereunder.
3. PAYMENTS. On the date hereof, MUSA shall pay to
INTEK, by wire transfer, the sum of $1,350,000 (the "First
Payment") as partial consideration for certain deposits for
product purchases made by INTEK and as described in more detail
on Schedule 2.3(b)(8) to the Agreement, which deposits constitute
part of the Acquired Assets. INTEK acknowledges receipt of the
First Payment. MUSA shall pay to INTEK the sum of Four Hundred
Fifty Thousand Dollars ($450,000), by wire transfer, on October
20, 1996 for the Deposits and upon receipt thereof, such Deposits
shall be deemed assigned to MUSA.
4. INDEMNIFICATION. From and after the Closing, but
subject to the conditions and limitations set forth in this
Assignment, MUSA shall defend, indemnify and save INTEK and its
directors, officers, employees, affiliates, agents, successors
and assigns harmless from and against any and all loss, cost,
damage or expense (including attorneys' fees) whatsoever (the
"Damages") resulting from or arising out of the Assumed
Liabilities, whether arising prior to, on or after the Effective
Date.
5. SUBORDINATION. The payment of any Damages by or
on behalf of MUSA will be subordinated in right of payment to the
prior payment in full of all Obligations under the Loan Agreement
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(the "Loan Agreement") dated September 19, 1996 between MUSA and
Securicor Communications Limited ("Securicor Communications"), as
the same may be amended from time to time. MUSA shall not make
any payment for the Damages until such time as the Obligations
(as defined in the Loan Agreement) have been paid to Securicor
Communications. Upon any distribution to creditors of MUSA in
any insolvency or liquidation proceeding relating to MUSA or its
respective properties, an assignment for the benefit of creditors
or any marshaling of MUSA's assets and liabilities, Securicor
Communications will be entitled to receive payment in full of all
Obligations before payment is made on account of the Damages by
or on behalf of MUSA, and until all Obligations are paid in full,
any distribution to which INTEK would be entitled shall be made
to Securicor Communications.
6. NOTICES. All notices and other communications
provided for hereunder shall be in writing (including
telegraphic, telex, telecopy, or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered by hand, if
to INTEK at:
INTEK Diversified Corporation
000 Xxxx 000xx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxxxx
Telecopy No.: (000) 000-0000
with a copy to:
Manatt, Xxxxxx & Xxxxxxxx, LLP
00000 Xxxx Xxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Telecopy No.: (000) 000-0000
to MUSA at:
Midland USA, Inc.
000 Xxxx 000xx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxxxx
Telecopy No.: (000) 000-0000
with a copy to
Xxxxxxx, Xxxxxxx & Xxxxxx, P.L.L.
One Cleveland Center
0000 Xxxx 0xx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxxxx Xxxxxxxxx, Esq.
Telecopy No.: (000) 000-0000
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or, as to each party, at such other address as shall be
designated by such party in a written notice to each other party
complying as to delivery with the terms of this Section. All
such notices and other communications shall, when mailed,
telegraphed, telexed, telecopied, cabled or delivered, be
effective seven days after being deposited in the mail in the
United States, or when delivered to the telegraph company,
confirmed by telex answerback, telecopied with confirmation or
receipt, delivered to the cable company, or delivered by hand to
the addressee or its agent, respectively.
7. AMENDMENTS, Etc. No amendment or waiver of any
provision of this Agreement shall in any event be effective
unless the same shall be in writing, approved and signed by the
parties hereto and then any such waiver or consent shall only be
effective in the specific instance and for the specific purpose
for which given.
8. NO WAIVER; REMEDIES.
(a) No failure on the part of either party 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 further
exercise thereof or the exercise of any other right. The
remedies herein provided are cumulative, may be exercised singly
or concurrently, and are not exclusive of any remedies provided
by law.
(b) Failure by any party at any time or times
hereafter to require strict performance by any other person of
any of the provisions, warranties, terms or conditions contained
herein shall not waive, affect or diminish any right of any party
at any time or times hereafter to demand strict performance
thereof, and such right shall not be deemed to have been modified
or waived by any course of conduct or knowledge of any party, or
any agent, officer or employee of such party.
9. SUCCESSORS AND ASSIGNS. This Agreement and all
obligations of the parties hereunder shall be binding upon the
successors and assigns of such parties.
10. GOVERNING LAW. This Agreement shall be governed
by, and be construed and interpreted in accordance with, the law
of the State of California. Wherever possible, each provision of
this Agreement shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of
this Agreement shall be prohibited by or invalid under applicable
law, such provision shall be ineffective only to the extent of
such prohibition or invalidity and without invalidating the
remaining provisions of this Agreement.
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11. SECTION TITLES. The Section titles contained in
this Agreement are and shall be without substantive meaning or
content of any kind whatsoever and are not a part of this
Agreement.
IN WITNESS WHEREOF, the parties have entered into this
Assignment as of the date first written above.
INTEK DIVERSIFIED CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
Its: Secretary
MIDLAND USA, INC.
By: /s/ Xxxxx Xxxxxxx
Its: President
ACKNOWLEDGED BY:
MIDLAND INTERNATIONAL
CORPORATION
By: /s/ Xxxxx X'Xxxx
Its: Executive Vice President
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