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EXHIBIT 10.1
ASSET PURCHASE AGREEMENT
This Agreement is made as of November 4, 1996, between Molmec, Inc., a
Michigan corporation ("Seller") and LDM Industries Inc., d/b/a LDM Technologies,
Inc., a Michigan corporation ("Buyer").
PREAMBLE
Seller is engaged in the business of manufacturing and supplying
injection molded plastic parts and systems, primarily to the automotive industry
(the "Business"). Seller desires to sell to Buyer, and Buyer desires to purchase
from Seller, substantially all of Seller's assets used or useful in connection
with, or otherwise relating to, the Business, all upon the terms and subject to
the conditions set forth herein. Therefore, intending to be legally bound
hereby, the parties agree as follows:
AGREEMENT
ARTICLE I
PURCHASE AND SALE OF ASSETS
1.01. Purchase and Sale of Assets. On the closing date (defined
below), Seller shall sell to Buyer, and Buyer shall purchase from Seller, all of
Seller's rights, title and interest in and to the following assets of Seller
(collectively, the "Assets"):
(a) the real property listed on Schedule 1.01, the buildings
and other improvements constructed thereon and all other rights associated
therewith (collectively, the "Real Property");
(b) all equipment, machinery, fixtures, tools, dies, patterns,
vehicles, computer hardware and software and furniture (collectively, the
"Equipment"), and all supplies, spare parts and warranties relating to any of
the Equipment;
(c) all raw material, work-in-process and finished goods
inventory of the Business (collectively, the "Inventory");
(d) all patents, registered and unregistered trademarks,
service marks, logos, corporate and trade names and registered and common law
copyrights, and all applications therefor, used and useful in connection with
the Business (collectively, the "Intellectual Property");
(e) all inventions, discoveries, techniques, processes,
methods, formulae, designs, trade secrets, confidential information, know-how
and ideas used or useful in connection with the Business;
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(f) all accounts receivable of the Business (the
"Receivables") and all other claims, causes of action, choses in action and
rights of recovery and setoff relating to the Business or any of the Assets;
(g) all bids, offers, leases, licenses, contracts, agreements
and business arrangements relating to the Business or any of the Assets (the
"Business Agreements");
(h) all permits, licenses, franchises, certificates,
authorizations, consents and approvals obtained from or issued by any
governmental entity and which are necessary or desirable for the ownership or
operation of the Business or the ownership, operation or use of any of the
Assets (collectively, the "Business Permits");
(i) all books, records, files, ledgers, drawings,
specifications and manuals relating to the Business or any of the Assets, all
advertising materials relating to the Business and all other information
relating to the Business or any of the Assets, regardless of the form in which
such information appears;
(j) all goodwill of the Business or associated with any of
the Assets;
(k) all other assets of Seller, tangible or intangible.
1.02. Excluded Assets. Notwithstanding any other provisions hereof,
the Assets shall not include the items listed on Schedule 1.02 (the "Excluded
Assets").
1.03. Assumption of Liabilities. Seller agrees that Buyer assumes no
liabilities of Seller, whether accrued, contingent, known, unknown or otherwise
except for those liabilities listed on Schedule 1.03 and those liabilities that
arise out of or relate to the Assets or the Business as conducted in the
ordinary course of Business through the Closing Date (the "Assumed
Liabilities"). Seller shall be responsible for any liabilities from acts or
omissions which arise prior to the Closing Date and which are not specifically
assumed by Buyer. In addition, wrongful acts and product recalls relating
to any period prior to the Closing Date shall be treated as undisclosed
liabilities of Seller and shall not be assumed by Buyer. Buyer shall be
entitled to treat any such undisclosed liability as a liability subject to
indemnification by Seller, pursuant to Section 6.01 hereof. Notwithstanding
anything in this Agreement to the contrary, Buyer shall assume (a) any
executory obligations of continued performance arising in the ordinary course of
business under any employment contracts and all other employment relationships
as they currently exist, including Seller's employment policies, and (b) the
current salary bonus plan through December 31, 1996.
1.04. Purchase Price. Subject to Section 1.05 hereof, the purchase
price for the Assets (the "Purchase Price") shall be Sixty Million Dollars
($60,000,000), less the value of the Excluded Assets, plus the amount of the
Assumed Liabilities pursuant to Section 1.03 hereof, plus the amount of the
reserve accounts set forth on Schedule 1.05 (the amount of the reserve accounts
being
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reflected in the Sixty Million Dollar cash portion of the Purchase Price). The
Purchase Price shall be payable by Buyer as follows:
(a) One Million Dollars ($1,000,000) in immediately
available funds (the "Deposit") shall be delivered to Comerica Bank (the
"Deposit Escrow Agent"), on the date this Agreement is fully executed, as
evidence of Buyer's good faith, to be held and disbursed in accordance with the
terms of an Escrow Agreement attached hereto as Exhibit A (the "Deposit Escrow
Agreement"). The Deposit will be applied to the Purchase Price at the Closing
(as defined hereafter). If Seller terminates this Agreement pursuant to Section
7.12(a)(iii), or if Buyer shall otherwise fail or refuse to complete the Closing
as required by this Agreement, which may or may not result in Seller's
termination of this Agreement pursuant to Section 7.12(a)(iv), then Seller shall
be entitled to the Deposit and any interest thereon, in addition to any other
available legal remedies. If this Agreement is terminated pursuant to Section
7.12(a)(i) or (ii), then Buyer shall be entitled to the Deposit and any interest
thereon, or if Seller shall otherwise fail or refuse to complete the Closing as
required by this Agreement, then Buyer shall be entitled to the Deposit and any
interest thereon, in addition to any other available legal remedies.
(b) One Million Two Hundred Fifty Thousand Dollars ($1,250,000)
in immediately available funds (the "Escrow Fund") shall be delivered on the
Closing Date to a federally insured commercial bank reasonably acceptable to
Buyer and Seller (the "Fund Escrow Agent"), to be held or disbursed in
accordance with the terms of an Escrow Agreement in substantially the form of
Exhibit B (the "Fund Escrow Agreement").
(c) Buyer shall retain from the Purchase Price an amount to
be mutually determined by Buyer and Seller prior to November 22, 1996, (the
"Hold-Back") to be held by the Buyer until it receives from Seller (i) written
confirmation from the Michigan Employment Security Commission to the effect that
all contributions, penalties and accrued interest due from Seller have been paid
in full; and (ii) a certificate from the Commissioner of Revenue of the Michigan
Department of Treasury stating that all taxes due to the State of Michigan
including, but not limited to, single business taxes, excise taxes, sales taxes
and use taxes are paid. Promptly after receipt of the items described above,
Buyer will disburse the Hold-Back by delivering Seller a cashier's or certified
check in the amount of the Hold-Back.
(d) The balance in immediately available funds shall be paid
to Seller on the Closing Date;
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1.05. Adjustments to Purchase Price.
(a) Closing Balance Sheet.
(i) Within sixty (60) days after the Closing Date,
Seller shall cause its independent accountants to deliver to Seller and Buyer an
audited balance sheet for the Business as of the Closing Date (the "Closing
Balance Sheet"). This Closing Balance Sheet shall reflect the net book value of
the Assets purchased by Buyer, as of the Closing Date. For purposes of this
Agreement, the term "net book value" shall mean an amount equal to the Assets
less the Assumed Liabilities, reflected on the September 29, 1996 balance sheet
or the Closing Balance Sheet, as the context indicates, with inventory being
accounted for on a first in first out basis for both balance sheets. Buyer and
Seller each shall (A) designate a representative to assist and shall cooperate
with each other and the independent accountants in preparing the Closing Balance
Sheet and (B) Buyer shall pay all costs assessed by the independent accountants
in connection with preparation and delivery of the Closing Balance Sheet.
(ii) The Closing Balance Sheet shall be accompanied
by a report of Seller's independent accountants stating that the Closing Balance
Sheet has been prepared in accordance with generally accepted accounting
principles ("GAAP") applied on a basis consistent with prior years (subject only
to such exceptions thereto as agreed to by Buyer and Seller). The Closing
Balance Sheet shall be based upon a physical inventory of the Assets taken by
Buyer and the independent accountants and observed by Seller.
(iii) The Purchase Price shall be increased or
decreased by an amount equal to the amount by which the net book value of the
Assets on the Closing Date (as reflected on the audited Closing Balance Sheet)
is greater than or less than the net book value of the Assets on September 29,
1996 (as reflected on Seller's financial statements for the period ended
September 29, 1996).
(iv) If any amount is payable by Seller to Buyer
under subsection (iii) above, Seller shall promptly pay such amount to Buyer in
immediately available funds. If any amount is payable by Buyer to Seller
pursuant to subsection (iii) above, Buyer shall promptly pay such amount to
Seller in immediately available funds.
(b) Consistent with past practice, Seller has established
numerous reserve accounts for meeting potential liabilities and claims. These
reserves are set forth on Schedule 1.05. Buyer agrees to assume all
responsibility for the liabilities covered by these reserves realized after the
Closing Date in excess of amounts reserved, and Seller agrees that Buyer shall
be entitled to the benefit of any settlement of the reserve liability after the
Closing Date in an amount less than the amounts reserved.
(c) Seller has also established an environmental reserve
account in the amount of One Hundred and Two Thousand Dollars ($102,000) for
meeting potential environmental
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liabilities and claims. Buyer may assert a claim or claims against the Escrow
Fund for any environmental liabilities or claims which exceed the environmental
reserve account. Amounts claimed against the environmental reserve account or
the Escrow Fund under this Paragraph shall be exempt from the $10,000 and 1%
indemnification Threshold Amount established at Section 6.06 of this Agreement.
(d) Disputes. Any dispute which may arise between Seller and
Buyer as to the Closing Balance Sheet, shall be resolved in the following
manner:
(i) The disputing party shall notify the other party in
writing within fifteen (15) days after the delivery of the disputed information
that it disputes the same and such notice shall specify in reasonable detail the
nature of the dispute;
(ii) during the fifteen (15) day period following the date
of such notice, the parties shall attempt to resolve their dispute and to
determine the appropriateness of the information; and
(iii) if at the end of the fifteen (15) day period
specified in subsection (ii) above, the parties shall have failed to reach a
written agreement with respect to such dispute, the matter shall be referred to
an independent firm of certified public accountants (or, if Buyer and Seller
cannot agree on a firm to serve in such capacity, Buyer and Seller shall each
select a firm and such firms shall, together, select a third firm)
("Arbitrator"), which shall act as an arbitrator and shall issue its report as
to the disputed information within sixty (60) days after such dispute is
referred to the Arbitrator. Each of the parties hereto shall bear all costs and
expenses incurred by it in connection with such arbitration, except that the
fees and expenses of the Arbitrator hereunder shall be borne equally by Seller
and Buyer. This provision for arbitration shall be specifically enforceable by
the parties, and the decision of the Arbitrator in accordance with the
provisions hereof shall be final and binding and there shall be no right of
appeal therefrom.
1.06. Assignment of Value. Buyer and Seller shall use their best
efforts to comply with the applicable requirements of the Internal Revenue Code
of 1986, as amended (the "Code"), by preparing a schedule to be executed at the
Closing (defined below) reflecting the allocation of the total price paid to the
respective Assets, which allocation shall be used by them in preparing their
respective income tax returns; provided, that any failure to agree on such
allocation shall not relieve either party of its obligations hereunder. Seller
and Buyer agree that such allocation for all Real Property shall be at fair
market value, and that the total price paid by Buyer which exceeds the net book
value of the Assets will be allocated to goodwill.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE SELLER
Seller hereby represents and warrants to Buyer as follows:
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2.01. Organization and Qualification. Seller is a corporation duly
organized, validly existing and in good standing in the State of Michigan.
Seller is duly qualified to do business as a foreign corporation and is in good
standing in all jurisdictions in which the ownership of its properties or the
nature of its business makes such qualification necessary.
2.02. Authority and Authorization. Seller has the corporate power and
authority to own its properties and assets, to conduct its business as presently
conducted and to execute, deliver and perform this Agreement and the other
Transaction Documents (defined below).
2.03. Execution and Binding Effect. This Agreement has been, and on
the Closing Date the other Transaction Documents will be, duly and validly
executed and delivered by Seller and delivery will constitute legal, valid and
binding obligations of Seller enforceable against Seller in accordance with
their respective terms.
2.04. No Breach, Default, Violation or Consent. Assuming that Seller
obtains all necessary consents with respect to the assignment or transfer of
Business Agreements, Intellectual Property and Business Permits which are listed
on Schedule 5.02(c), the execution, delivery and performance by Seller of this
Agreement and the other Transaction Documents do not and will not:
(a) violate Seller's charter or by-laws;
(b) breach or result in a default (or an event which, with
the giving of notice or the passage of time, or both, would constitute a
default) under, require any consent under or give to others any rights of
termination, acceleration, suspension, revocation, cancellation or amendment of
any Business Agreement or Business Permit, or any agreement representing
indebtedness for borrowed money or any trust indenture pursuant to which Seller
has issued debt obligations;
(c) breach or otherwise violate any order, writ, judgment,
injunction or decree issued by any governmental entity (each a "Governmental
Order") which names Seller or is directed to Seller, the Business or any of the
Assets;
(d) violate any law, rule, regulation, ordinance or code of
any governmental entity (each a "Governmental Rule"); or
(e) require any consent, authorization, approval, exemption or
other action by, or any filing, registration or qualification with, any
governmental entity, to Seller's knowledge.
2.05. Financial Statements. Seller has previously delivered to Buyer
complete copies of (a) its audited balance sheets and statements of income,
retained earnings and changes in financial position as of and for its fiscal
year ended December 31, 1994, including the footnotes thereto, (b) its audited
balance sheets and statements of income, retained earnings and changes in
financial position as of and for its fiscal year ended December 31, 1995; and
(c) its unaudited monthly balance sheets and statements of income, retained
earnings and changes in financial position for the months
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of January 1996 through and including September 1996, (the "Current Financial
Statements" as to the items described in clauses (b) and (c) above, and,
together with the items described in clause (a) above, the "Financial
Statements"). The Financial Statements present fairly the financial condition
of Seller as at the end of the periods covered thereby and the results of its
operations and the changes in its financial position for the periods covered
thereby, and to the best of Seller's knowledge were prepared in accordance with
GAAP (except for LIFO adjustments for the Financial Statements after December
31, 1995) applied on a consistent basis throughout the periods covered thereby.
Except as and to the extent otherwise disclosed in the Current Financial
Statements and on Schedule 2.05, Seller has no knowledge of other material
liabilities, whether direct or indirect, fixed or contingent or otherwise.
2.06. Tax Matters. Except as otherwise disclosed on Schedule 2.06:
(a) all tax returns and reports required to be filed by
Seller have been filed;
(b) Seller has paid or has made adequate reserves on its
books for the payment of all taxes, interest, penalties, assessments and
deficiencies shown to be due on such tax returns and reports, or claimed to be
due by any governmental entity, or which Seller is required to withhold on
behalf of any other person or entity (each a "Person");
(c) Seller has no knowledge of any proposed assessment of any
additional taxes by any governmental entity or of any basis for any such
assessment (whether or not reserved against);
(d) the federal income tax liabilities of Seller have been
finally determined by the Internal Revenue Service (the "IRS"), or the time for
audit has expired, for all fiscal periods ending on or prior to December 31,
1992;
(e) Seller is not currently being audited by any
governmental entity, and no such audit is pending or, to the best of Seller's
knowledge, threatened.
2.07. Litigation. Except as otherwise disclosed on Schedule 2.07,
there is no pending or, to the best of Seller's knowledge, threatened
investigation, action or proceeding against Seller, the Business or any of the
Assets by or before any governmental entity or arbitrator, and Seller has no
knowledge of any basis for any such action or proceeding. Schedule 2.07 sets
forth each instance in which Seller (i) is subject to any outstanding
injunction, judgment, order, decree, ruling, or charge, or (ii) is a party or,
to the knowledge of Seller, is threatened to be made a party to any action,
suit, proceeding, hearing, or investigation of, in, or before any court or
quasi-judicial or administrative agency of any federal, state, local, or foreign
jurisdiction or before any arbitrator. Schedule 2.07 sets forth a correct and
complete list of each such investigation, action and proceeding described in the
preceding sentences, the parties thereto, the alleged basis therefor, the relief
sought therein and the current status thereof.
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2.08. Absence of Certain Changes and Events. Except as otherwise
disclosed on Schedule 2.08, since December 31, 1995:
(a) Seller has not incurred any material obligation or
liability except for normal trade obligations incurred in the ordinary course of
business;
(b) no casualty, loss or damage has occurred with respect to
any of the Assets, whether or not the same is covered by insurance;
(c) Seller has not sold, transferred or otherwise disposed
of any of its properties or assets or any interest therein, or agreed to do any
of the foregoing, except for sales of inventory in the ordinary course of
business;
(d) no executive officer or other key employee of Seller has
left his or her employment with Seller;
(e) there has been no payment, discharge or other
satisfaction of any liabilities of Seller, whether direct or indirect, fixed or
contingent or otherwise, other than the satisfaction in the ordinary course of
business, of liabilities reflected on the Current Financial Statements or
incurred in the ordinary course of business since the Current Financial
Statement Date; and
(f) Seller has not paid any dividend or made any
distribution, whether in cash, shares, or property, with respect to its capital
stock, and has not increased the salary of or declared or paid a bonus to any
employee earning over $50,000 per year, since September 30, 1996.
2.09. Constituent Document and Governmental Rules. Seller is in
compliance with (a) its charter and by-laws and (b) all Governmental Rules
applicable to Seller, the Business or the Assets, except, in each case, for such
non-compliance as, individually or in the aggregate, has not resulted in, and is
not likely to result in, a material adverse change.
2.10. Environmental Matters. Except as otherwise disclosed on
Schedule 2.10, Seller and the Real Property are in compliance with all
Environmental Laws (as hereinafter defined). All federal, state and local
permits, licenses and authorizations required for present or past use of the
Real Property or activities of the Seller have been obtained, are presently in
effect and are listed on the attached Schedule 2.10. Seller is and has been in
full compliance with all such permits, licenses and/or authorizations. Seller
has not used Hazardous Materials (as hereinafter defined) on or affecting the
Real Property in any manner which violates federal, state or local laws,
ordinances, statutes, rules, regulations or judgments governing the use,
storage, treatment, handling, manufacture, transportation or disposal of
Hazardous Materials ("Environmental Laws") or received any notice of any
violation of Environmental Laws and, to the best of Seller's knowledge, no prior
owner of the Real Property or any current or prior occupant has used Hazardous
Materials on or affecting the Real Property in any manner which violates
Environmental Laws, except as disclosed in those certain environmental reports
prepared by ATEC Environmental Consultants, Testing
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Engineers and Consultants, XxXxxxxx & Associates, and Environmental Service &
Technologies (collectively, the "Environmental Reports"). To the best of
Seller's knowledge, there have been no actions commenced or threatened by any
party for noncompliance with any Environmental Laws except as disclosed on
Schedule 2.10. Seller is not in violation of any statute, law, regulation or
ordinance for its failure to report, commence clean-up, or clean up the
Hazardous Materials which are outlined in the Environmental Reports. To the
best of Seller's knowledge, all of the Environmental Reports prepared on the
Real Property have been provided or made available to Buyer. "Hazardous
Materials" includes, without limitation, any flammable explosives, radioactive
materials, hazardous materials, hazardous waste, hazardous or toxic substances,
petroleum, petroleum by-products, toxic materials or related materials defined
in the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended (42 U.S.C. Section 9601, et seq.), the Resource Conservation
and Recovery Act, as amended (42 U.S.C. 6901, et seq.), Part 201 of the Michigan
Natural Resources and Environmental Protection Act, as amended, the Michigan
Environmental Response Act, as amended, and the regulations adopted in
publications promulgated pursuant thereto, or any other federal, state or local
governmnental law, ordinance, rule or regulation, an object of which is to
regulate or improve health, safety or the environment.
2.11 Real Property.
(a) Schedule 2.11 sets forth a correct and complete list of
all real property currently owned or leased by the Company, together with the
current uses of such property by the company and each Person who currently
occupies property currently owned by the Company.
(b) Schedule 2.11 sets forth a correct and complete list
of all leases, subleases and other material agreements or rights pursuant to
which any Person has the right to occupy or use any real property owned by the
company, together with the names of the lessees or other obligors thereunder,
the rental or other consideration payable thereunder and the duration thereof,
including any renewal options,
(c) Schedule 2.11 sets forth a correct and complete list of
all leases, subleases and other material agreements or rights pursuant to which
the Company has the right to occupy or use any real property owned by others,
together with the names of the lessors or other grantors thereunder, the
location of the property covered thereby, the rental or other consideration
payable thereunder and the duration thereof, including any renewal options.
2.12. Personal Property. Schedule 2.12 sets forth a correct and
complete list of all leases and other agreements with annual lease payments in
excess of Five Thousand Dollars ($5,000), pursuant to which Seller leases any of
the Equipment, together with the names of the lessors thereunder, the personal
property covered thereby, the annual rental thereunder, and the duration
thereof, including any renewal options.
2.13. Intellectual Property. Schedule 2.13 sets forth a correct and
complete list of (a) all Intellectual Property, (b) all licenses or other
agreements pursuant to which any Person has the right
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to use any Intellectual Property owned by Seller, together with the names of the
licensors thereunder, the Intellectual Property covered thereby, the annual fee
or other consideration payable thereunder and the duration thereof, including
any renewal options, and (c) all licenses or other agreements pursuant to which
Seller has the right to use any Intellectual Property owned by others, together
with the names of the licensees thereunder, the Intellectual Property covered
thereby, the annual fee or other consideration payable thereunder and the
duration thereof, including any renewal options. Seller has the lawful right to
use all of the Intellectual Property, and no such use infringes upon the lawful
rights of any other Person. To the best of Seller's knowledge, no Person is
using any Intellectual Property in a manner which infringes upon the lawful
rights of Seller. The Intellectual Property is all of the Intellectual Property
necessary for the operation of the Business.
2.14. Title to Assets. Except as otherwise disclosed on Schedule
2.14, Seller has (a) good and marketable title to all Assets purported to be
owned by it and (b) good leasehold title to all Assets purported to be leased
by it, in each case free and clear of all liens, claims and encumbrances of any
nature whatsoever (collectively, "Liens"). On the Closing Date Seller will
transfer to Buyer title to the Assets free and clear of all Liens other than
those marked as "Permitted Liens" on Schedule 2.14.
2.15. Employee Benefit Plans.
(a) Schedule 2.15 sets forth a true, correct and complete
list and has attached thereto a description or an accurate copy of, each and
every Employee Benefit Plan, arrangement or practice maintained by Seller to
which Seller contributes, or is required to contribute or under which any
employee of Seller is accruing benefits whether formal or informal, legally
binding or not, and whether affecting one or more of its employees. Such
Employee Benefit Plans are referred to as "Employee Benefit Plans" as defined in
Section 3(3) of ERISA.
(b) Seller has delivered or will deliver to Buyer one copy of
each of the Employee Benefit Plans and one copy of any related annuity contract,
trust agreement, or other instrument to which the Employee Benefit Plans are
funded.
(c) Seller does not have any commitment whether formal or
informal and whether legally binding or not, to create any additional Employee
Benefit Plan, arrangement or practice, or to modify or change any such Employee
Benefit Plan, arrangement or practice, except as accurately and completely
described on Schedule 2.15.
(d) Except as disclosed in the Financial Statements and/or
Schedule 2.15, the Seller does not have any unfunded past service liability with
respect to any of the Employee Benefit Plans, and the actuarially computed value
of any vested benefits under any of the Employee Benefit Plans is in accordance
with the most recent actuarial evaluation report relating to such plan, a true
copy of which shall be delivered to Buyer.
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(e) The IRS has issued favorable determination letters to the
effect that each Pension Plan is qualified within the meaning of Section 401 of
the Code and that each related Trust is exempt under Section 501 of the Code,
and Seller has no knowledge of any fact that may adversely affect the qualified
status of any Pension Plan or related Trust.
(f) To the best of Seller's knowledge, Seller has complied in
all material respects with all applicable federal, state and local laws, rules
and regulations relating to employment and/or employment relationships,
including, without limitation, wage related laws, anti-discrimination laws.
employee safety laws, and fringe benefit coverage laws.
(g) Seller has no employees who are working under any
collective bargaining agreement, and Seller has no knowledge of any organizing
activity that is existing or planned for the immediate future.
(h) Seller has no Pension Plans that are subject to the
jurisdiction of the Pension Benefit Guarantee Corporation (PBGC). Seller does
not and has never participated in a "multi-employer plan" as defined in Section
3(37) of ERISA.
(i) Seller has filed all required annual reports with
respect to its Employee Benefit Plans on Form 5500 required to be filed with any
governmental agency for each of the Employee Benefit Plans, and if applicable,
certified financial statements and actuarial valuations. Copies of all the above
have been or will be supplied to Buyer.
(j) There are no actions, suits, investigations or other
proceedings pending, or to the best of Seller's knowledge, threatened against
any Employee Benefit Plan or trust or any fiduciary thereof, by any government
agency, employee, former employee, spouse of any employee or former employee or
beneficiary of any such Plan, and Seller has no knowledge or any basis for the
commencement of any such proceeding.
(k) There has been no "prohibited transaction", as such term
is defined in Section 4975 of the Internal Revenue Code, with respect to any
other Employee Benefit Plans.
(l) Seller has complied in all material respects with the
notice requirements of health insurance continuation (COBRA) with respect to
employees, former employees and other beneficiaries.
(m) If Seller terminates any employment relationships or
Employee Benefit Plans in connection with this Agreement, Seller will comply
with all applicable federal and state laws, rules and regulations governing the
termination of employment and/or termination of the Employee Benefit Plan. Buyer
anticipates offering employment to nearly all of Seller's employees. If certain
of Seller's employees are not offered employment by Buyer, Buyer agrees to
indemnify Seller and Seller's Shareholders for any liability arising out of the
termination of said employees, and such indemnification shall be paid directly
by Buyer, on a monthly basis, and shall not be paid from the
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Escrow Fund, and shall not be subject to any threshold amount. If a transfer
and assumption of employment agreements and/or Employee Benefit Plans is
requested by Buyer, Seller will execute any and all documents reasonably
requested by Buyer to assist in the transfer of such employment agreements and
Employee Benefits Plans.
2.16. Personnel Matters.
(a) Schedule 2.16 sets forth a correct and complete list of
(i) all directors and executive officers of Seller, (ii) all other employees of
or consultants to Seller whose annual compensation (including bonuses and
commissions) during Seller's fiscal year ended December 31, 1995 was One
Hundred Thousand Dollars ($100,000) or more, (iii) the current job title or
relationship to Seller of each such Person described in clauses (i) and (ii)
above, and (iv) any employee benefits available to any such Person that are not
generally available to employees of Seller.
(b) Schedule 2.16 is a complete list of all employment and
consulting agreements between Seller and Seller's employees and consultants.
Seller's Employee Handbook represents that each employee without a written
employment agreement is terminable at-will.
(c) Except as otherwise disclosed on Schedule 2.16, since
December 31, 1995, Seller has not paid any employee or consultant any
compensation over and above amounts paid to such employees or consultants in the
normal course of their employment with Seller.
2.17. Insurance. Schedule 2.17 sets forth a correct and complete list
of all insurance policies of which Seller is the owner, insured, loss payee or
beneficiary and which relate to the Business or any of the Assets and indicates
for each such policy the carrier, the risks insured against, the amounts of
coverage and deductibles, the annual premium, the expiration date and any
pending claims thereunder.
2.18. Purchase Orders and Contracts. Schedule 2.18 sets forth a
correct and complete list of each of the customers and suppliers of Seller whose
purchases from or sales to Seller constituted five percent (5%) or more of
Seller's net sales or One Million Dollars ($1,000,000) or more of net
purchases, respectively, during Seller's fiscal year ended December 31, 1995,
and indicates with respect to each the name, dollar volume and nature of the
relationship (including the principal categories of products bought or sold). No
such customer or supplier has since terminated its relationship with Seller.
Seller has previously delivered to Buyer a correct and complete copy of all
written purchase orders or contracts.
2.19. Other Agreements. Schedule 2.19 lists the following contracts
and other agreements to which Seller is a party:
(a) Any agreement concerning a partnership or joint
venture;
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(b) any agreement (or group of related agreements) under
which is has created, incurred, assumed, or guaranteed any indebtedness for
borrowed money in excess of $5,000 under which it has imposed a security
interest on any of its assets, tangible or intangible;
(c) any material agreement concerning noncompetition;
(d) any profit sharing, stock option, stock purchase, stock
appreciation, deferred compensation, severance, or other material plan or
arrangement for the benefit of its current or former directors, officers, and
employees;
(e) any collective bargaining agreement;
(f) any agreement currently in effect under which it has
advanced or loaned any amount to any of its directors, officers, or employees
outside the ordinary course of business;
(g) any other agreement (or group of related agreements) the
performance of which involves consideration in excess of $500,000.
Seller has delivered to the Buyer a correct and complete copy of each written
agreement listed in Schedule 2.19 (as amended to date) and a written summary
setting forth the material terms and conditions of each oral agreement
referred to in Schedule 2.19. With respect to each such agreement: (A) the
agreement is legal, valid, binding, enforceable, and in full force and effect
in all material respects; (B) no party is in material breach or default, and
no event has occurred which with notice or lapse of time would constitute a
material breach or default, or permit termination, modification, or
acceleration, under the agreement; and (C) no party has repudiated any
material provision of the agreement.
2.20. Status of Business Agreements. Seller has previously delivered
to Buyer correct and complete copies of each Business Agreement listed on
Schedule 2.11 through Schedule 2.19. Each Business Agreement listed on any of
Schedule 2.11 through Schedule 2.19 is in full force and effect and is
enforceable against Seller and, to the best of Seller's knowledge, the other
parties thereto, in accordance with its terms. Seller is in compliance with
each such Business Agreement. To the best of Seller's knowledge, all other
parties to such Business Agreements are in substantial compliance with the
terms thereof. Except as otherwise disclosed on Schedule 2.20, each Business
Agreement may be assigned to Buyer without the consent of any other Person.
2.21. Warranty and Product Liability. Substantially all of the
products manufactured, sold, leased, and delivered by Seller have conformed in
all material respects with all applicable contractual commitments and all
express and implied warranties, and Seller has no knowledge of any material
liability for replacement or repair thereof or other damages in connection
therewith, subject only to normal product returns and the reserve for product
warranty claims set forth on the Current Financial Statements as adjusted for
operations and transactions through the Closing Date in accordance with
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the past custom and practice of Seller. Substantially all of the products
manufactured, sold, leased and delivered by Seller are subject to standard
terms and conditions of sale or lease.
Seller has no knowledge of any material liability arising out of any
injury to individuals or property as a result of the ownership, possession, or
use of any product manufactured, sold, leased, or delivered by Seller.
2.22. No Undisclosed Liabilities. Except as otherwise disclosed on
Schedule 2.22 or in the Financial Statements, Seller does not have any
liabilities or obligations, whether accrued, absolute, contingent, or
otherwise, and to Seller's knowledge there exists no fact or circumstance that
could give rise to any such liabilities or obligations in the future.
2.23. Quality of Inventory and Equipment. The inventory of Seller
consists of raw materials and supplies, manufactured and processed parts, work
in process, and finished goods, all of which is merchantable and fit for the
purpose for which it was procured or manufactured, and none of which is
slow-moving, obsolete, damaged, or defective, subject only to the reserve for
inventory writedown set forth on the face of the most recent balance sheet
(rather than in any notes thereto) as adjusted for operations and transactions
through the Closing Date in accordance with the past custom and practice of
Seller. Such adjustments shall include, without limitation, any reduction
resulting from the writedown or writeoff of slow-moving, obsolete, damaged, or
defective inventory, as reflected on the Closing Balance Sheet. The buildings,
machinery, equipment, and other tangible assets being purchased by Buyer are
free from material defects (patent and latent), have been maintained in
accordance with normal industry practice, and are in good operating condition
and repair (subject to normal wear and tear).
2.24. No Union/Collective Bargaining. There are no unions or
collective bargaining agreements at any plant owned or leased by Seller or at
Seller's headquarters.
2.25. Brokers. Seller has employed W.Y. Xxxxxxxx & Company as its
broker for this transaction. All compensation to Seller's broker shall be
Seller's sole responsibility. Seller has no liability or obligation to pay any
other fees or commissions to any other broker or to any finder, or agent with
respect to the transactions contemplated by this Agreement for which the Buyer
could become liable or obligated.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE BUYER
Buyer hereby represents and warrants to Seller as follows:
3.01. Organization. Buyer is a corporation duly organized, validly
existing and in good standing in the State of Michigan.
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3.02. Authority and Authorization. Buyer has the corporate power and
authority to own its properties and assets, to conduct its business as
presently conducted and to execute, deliver and perform this Agreement and the
other Transaction Documents.
3.03. Execution and Binding Effect. This Agreement has been, and on
the Closing Date the other Transaction Documents will be, duly and validly
executed and delivered by Buyer and constitute (or upon such execution and
delivery will constitute) legal, valid and binding obligations of Buyer
enforceable against Buyer in accordance with their respective terms.
3.04. No Breach, Default, Violation or Consent. The execution, delivery
and performance by Buyer of this Agreement and the other Transaction Documents
do not and will not:
(a) violate Buyer's charter or by-laws;
(b) breach or result in a default (or an event which, with
the giving of notice or the passage of time, or both, would constitute a
default) under, require any consent under or give to others any rights of
termination, acceleration, suspension, revocation, cancellation, or amendment
of any contract, agreement, instrument or document to which Buyer is a party
or by which Buyer or any of its properties or assets is bound;
(c) breach or otherwise violate any Governmental Order which
names Buyer or is directed to Buyer or any of its properties or assets;
(d) violate any Governmental Rule; or
(e) require any consent, authorization, approval, exemption
or other action by, or any filing, registration or qualification with, any
governmental entity.
3.05. Brokers. Buyer has no liability or obligation to pay any fees or
commissions to any broker or to any finder, or agent with respect to the
transactions contemplated by this Agreement for which the Seller could become
liable or obligated.
3.06. Xxxx Xxxxx Xxxxxx Filing. Buyer will file its Xxxx Xxxxx Xxxxxx
application no later than November 8, 1996. If Buyer does not file its Xxxx
Xxxxx Xxxxxx on or before November 8, 1996, then all parties shall be relieved
of their obligations hereunder, and Seller shall be free to communicate and
negotiate with other potential buyers notwithstanding anything to the contrary
contained in this Agreement or the Letter of Intent previously signed by
Seller and Buyer. In such event, Buyer shall be entitled to a return of the
deposit paid pursuant to Section 1.04(a). If Buyer files its Xxxx Xxxxx
Xxxxxx application by November 8, 1996, but there has been no definitive
response to such filing on or before December 20, 1996, then the Closing Date
shall automatically be extended to the Friday of the first full week following
receipt of governmental approval of such Xxxx Xxxxx Xxxxxx application.
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ARTICLE IV
TRANSACTIONS PRIOR TO CLOSING
4.01. Conduct of Business Prior to Closing. At all times prior to the
Closing Date, Seller shall:
(a) operate the Business only in the ordinary course and
consistent with past practice;
(b) maintain the Real Property and Equipment in reasonably
good repair and operating condition, ordinary wear and tear excepted;
(c) maintain in full force and effect all Business Permits and
insurance policies;
(d) not sell, transfer or otherwise dispose of any of the
Assets or any interest therein or agree to do any of the foregoing, except for
sales of inventory in the ordinary course of business;
(e) not incur, make, or assume any Lien, tenancy or other
matter affecting title to any of the Assets;
(f) not make, change or revoke any tax elections or make any
agreement or settlement with any taxing authority;
(g) not merge or consolidate Seller with or into any other
entity or agree to do any of the foregoing;
(h) comply with applicable Governmental Rules in all material
respects;
(i) take no action, and use its best efforts to prevent the
occurrence of any event or the existence of any condition, which would result
in any of Seller's representations and warranties herein not being true and
correct;
(j) not pay any dividend or make any distribution, whether
in cash, shares or property, with respect to its capital stock, other than
distributions to the Shareholders to reimburse the Shareholders for income
taxes paid or to be paid by the Shareholders on corporate taxable income;
(k) not amend its articles of incorporation or bylaws,
capital structure or accounting practices;
(l) not incur any liability for borrowed money or guaranty
the obligation of any other person for borrowed money, except for (i) the
incurrence of unsecured trade debt in the
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ordinary course of business consistent with past practice and (ii) advances
under the existing credit facility with Comerica Bank;
(m) grant to Buyer and its attorneys, employees, agents and
designees reasonable access to the books and records and appropriate executive
and managerial personnel of Seller, all during normal business hours on
reasonable notice;
(n) grant to Buyer and its attorneys, agents and designees
access to the Real Property to conduct inspections, investigations, appraisals,
tests and environmental site assessments of the Real Property including, but
not limited to, conducting soil tests of the Real Property, borings and other
tests to evaluate the environmental conditions which exist at the Real Property
(including Phase I and Phase II environmental assessments and baseline
environmental assessments ("BEAs") if necessary or desirable, as determined by
Buyer in Buyer's sole discretion) and the Real Property's compliance with all
applicable state and federal environmental laws and regulations, and
determining the availability of any governmental approvals or permits. The
cost of any and all such inspections, investigations, appraisals, tests and
determinations shall be paid by Buyer. Further, Seller agrees and acknowledges
that Buyer may submit the results of such inspections, investigations,
appraisals, tests, BEAs and determinations regarding the Real Property to the
Michigan Department of Environmental Quality; and
(o) as evidence of title to the Real Property, furnish or
cause to be furnished to Buyer at Seller's expense, not later than ten (10)
days after the date of execution of this Agreement by Seller, the following
title insurance commitments, policies and riders in preparation for the
Closing:
(i) with respect to each parcel of Real Property
that Seller owns, an ALTA Owner's Policy of Title Insurance issued by a title
insurer reasonably satisfactory to Buyer, in such amount as the Buyer
reasonably may determine to be the fair market value of such Real Property
(including all improvements located thereon), insuring title to such Real
Property to be in the Buyer as of the Closing Date; and
(ii) with respect to each parcel of Real Property that
Seller leases or subleases, an ALTA Leasehold Owner's Policy of Title Insurance
issued by a title insurer reasonably satisfactory to Buyer in such amount as
Buyer reasonably may determine, insuring title to the leasehold or subleasehold
estate to be in the Buyer as of the Closing Date. Each title insurance policy
delivered under Sections 4.01(o)(i) and (ii) above shall (a) insure title to
the Real Property and all recorded easements benefitting such Real Property, (b)
contain an "extended coverage endorsement" insuring over the general exceptions
contained customarily in such policies, and (c) if the Real Property consists
of more than one record parcel, contain a "contiguity" endorsement insuring
that all of the record parcels are contiguous to one another.
4.02. Casualty, Loss or Damage to Assets. If at any time prior to the
Closing Date any casualty, loss or damage shall occur with respect to any Asset
then Seller shall promptly inform
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Buyer of the same and shall, at Buyer's option, either (a) repair or replace
such Asset such that the Asset to be transferred to Buyer hereunder is in a
condition at least as good as it was in immediately prior to the occurrence of
such casualty, loss or damage or (b) transfer all insurance proceeds payable to
Seller on account of such casualty, loss or damage to Buyer at the Closing.
4.03. Best Efforts. The parties agree to use their reasonable best
efforts to take or cause to be taken and to do or cause to be done all such
actions and things as shall be necessary or advisable, or as shall be
reasonably requested by the other party, in order to consummate the
transactions contemplated hereby and by the other Transaction Documents.
Without limiting the generality of the foregoing, the parties agree to take all
reasonable actions necessary in order to obtain any consent or approval of any
third party, including without limitation any governmental entity, which is
required in connection with this Agreement or the other Transaction Documents
or any of the transactions contemplated hereby or thereby.
ARTICLE V
CLOSING AND CLOSING CONDITIONS
5.01. Closing. The closing of the transaction contemplated hereby (the
"Closing") shall take place on or before December 20, 1996, at the offices of
Xxxxxxxx Xxxxx, P.C., Troy, Michigan, or at such other time or place, or on
such other date as the parties may mutually agree upon. At Seller's sole
option, the Closing may be delayed to a date not later than January 3, 1997.
In any event the Closing shall take place on a Friday. The date on which the
Closing occurs is referred to herein as the "Closing Date".
5.02. Conditions Precedent to Obligations of Buyer. The obligations of
Buyer hereunder to proceed with the Closing shall be subject to the
satisfaction by Seller on or prior to the Closing Date of each of the following
conditions precedent:
(a) Accuracy of Representations and Warranties. The
representations and warranties of the Seller set forth herein shall be true and
correct on and as of the Closing Date with the same force and effect as though
made on and as of such date.
(b) Performance and Compliance, Seller shall have performed
or complied with each covenant and agreement to be performed or complied with
by it hereunder on or prior to the Closing Date.
(c) Consents and Approvals. Seller shall have obtained or
made each consent to assignment or transfer, authorization, approval,
exemption, filing, registration or qualification, as are necessary for the
performance of this Agreement, all of which are listed on Schedule 5.02(c).
(d) Litigation. There shall be no pending or threatened
action by or before any governmental entity or arbitrator seeking to restrain,
prohibit or invalidate any of the transactions contemplated hereby or by any of
the other Transaction Documents or seeking monetary relief
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against Buyer by reason of the consummation of such transactions, and there
shall not be in effect any Governmental Order which has such effect.
(e) Officer's Certificate. Seller shall have delivered to
Buyer a certificate of its President dated the Closing Date and certifying that
each of the conditions specified in subsections (a), (b), (c) and (d) above
have been met.
(f) Secretary's Certificate. Seller shall have
delivered to Buyer a certificate of its Secretary dated the Closing Date and
certifying (i) that correct and complete copies of its charter and by-laws are
attached thereto, (ii) that correct and complete copies of each resolution of
its board of directors and the Shareholders approving this Agreement and the
other Transaction Documents to which it is a party and authorizing the
execution hereof and thereof and the consummation of the transactions
contemplated hereby and thereby are attached thereto and (iii) the incumbency
and signatures of the officers of Seller authorized to execute and deliver
this Agreement and the other Transaction Documents to which Seller is a party
on behalf of Seller.
(g) Opinion of Counsel. Seller shall have delivered to Buyer
an opinion of Seller's counsel dated the Closing Date and in form and substance
reasonably satisfactory to Buyer and its counsel with respect to the matters in
Sections 2.01, 2.02, 2.03, 2.04 and 2.07.
(h) Other Transaction Documents. Seller and any other
parties thereto (other than Buyer) shall have executed and delivered to Buyer
the following documents and such other documents and instruments, in form and
substance satisfactory to Buyer and its counsel, as shall be necessary or
desirable in order to consummate the transactions contemplated hereby, each
dated the Closing Date (together with this Agreement and any agreements listed
in Section 5.03(h), the "Transaction Documents"):
(i) the Fund Escrow Agreement;
(ii) a Xxxx of Sale;
(iii) Warranty Deeds;
(iv) an Assignment of Patents;
(v) an Assignment of Trademarks;
(vi) an Assignment of Copyrights;
(vii) an Assignment of Lease for the Avon plant;
(viii) a Noncompetition Agreement with each of
Xxxxxx X. Xxxxxx, Xx. and Xxxxxxx X. Xxxxxx; and
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(ix) any required waivers or consents of third
parties.
(i) Business Permits. To the extent that any Business
Permits are not transferable to Buyer, Buyer shall have obtained, or satisfied
itself that it will be able to obtain, Business Permits in its own name that
will permit Buyer to own, operate or use the Business and the Assets to the
same extent as Seller.
(j) Marketable Title. Seller shall hold marketable title to
all real property it purports to own.
(k) Due Diligence. Buyer shall have satisfactorily completed
its due diligence investigation by November 22, 1996. Buyer shall notify
Seller in writing on or prior to November 22, 1996, if it is not satisfied with
the results of its due diligence investigation, whereupon all parties shall be
relieved of their obligations hereunder, and Seller shall be free to
communicate and negotiate with other potential buyers notwithstanding anything
to the contrary contained in this Agreement or the Letter of Intent previously
signed by Seller and Buyer. In such event, Buyer shall be entitled to a
return of the deposit paid pursuant to Section 1.04 (a).
(l) Xxxx-Xxxxx-Xxxxxx. Any Xxxx-Xxxxx-Xxxxxx filing made in
connection with the acquisition of Assets shall have been approved by the
Federal Trade Commission. Any Xxxx-Xxxxx-Xxxxxx filing fee shall be paid by
the Buyer.
(m) Certificate of Vice President - Finance. Seller shall
have delivered to Buyer a certificate of its Vice President - Finance, Xxxxx
X. Xxxxx, dated the Closing Date and certifying that the Financial Statements
and all subsequent unaudited monthly balance sheets and statements of income,
retained earnings and changes in financial position present fairly the
financial condition of Seller as at the end of the periods covered thereby and
the results of its operations and the changes in its financial position for
the periods covered thereby, and were prepared in accordance with GAAP, except
for LIFO adjustments, applied on a consistent basis throughout the periods
covered thereby.
(n) Bulk Transfer Act. Seller shall have complied with the
bulk transfer provisions of Article 6 of the Michigan Uniform Commercial Code
(UCC) as they apply to the transaction described in this Agreement. However,
such compliance shall be limited to those creditors of the Seller whose claims
will not be specifically assumed by Buyer pursuant to this Agreement.
5.03 Conditions Precedent to Obligations of Seller. The obligations
of Seller hereunder to proceed with the Closing shall be subject to the
satisfaction by Buyer on or prior to the Closing Date of each of the following
conditions precedent:
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(a) Accuracy of Representations and Warranties. The
representations and warranties of Buyer set forth herein shall be true and
correct on and as of the Closing Date with the same force and effect as though
made on and as of such date.
(b) Performance and Compliance. Buyer shall have performed or
complied with each covenant and agreement to be performed or complied with by
it hereunder on or prior to the Closing Date.
(c) Consents and Approvals. Buyer shall have obtained or
made each consent, authorization, approval, exemption, filing, registration or
qualification, as are necessary for the performance of this Agreement, if any.
(d) Litigation. There shall be no pending or threatened
action by or before any governmental entity or arbitrator seeking to restrain,
prohibit or invalidate any of the transactions contemplated hereby or by any of
the other Transaction Documents or seeking monetary relief against Seller by
reason of the consummation of such transactions, and there shall not be in
effect any Governmental Order which has such effect.
(e) Officer's Certificate. Buyer shall have delivered to
Seller a certificate of its President dated the Closing Date and certifying
that each of the conditions specified in subsections (a), (b), (c) and (d)
above have been met.
(f) Secretary Certificate. Buyer shall have delivered to
Seller a certificate of its Secretary dated the Closing Date and certifying
(i) that correct and complete copies of its charter and by-laws are attached
thereto, (ii) that correct and complete copies of each resolution of its board
of directors approving this Agreement and the other Transaction Documents to
which it is a party and authorizing the execution hereof and thereof and the
consummation of the transactions contemplated hereby and thereby are attached
thereto and (iii) the incumbency and signatures of the officers of Buyer
authorized to execute and deliver this Agreement and the other Transaction
Documents to which Buyer is a party on behalf of Buyer.
(g) Opinion of Counsel. Buyer shall have delivered to Seller
an opinion of Buyer's counsel dated the Closing Date and in form and substance
reasonably satisfactory to Seller and its counsel with respect to the matters
in Sections 3.01, 3.02, 3.03 and 3.04.
(h) Other Transaction Documents. Buyer shall have executed
and delivered to Seller the other Transaction Documents to which Buyer is a
party and such other documents and instruments, in form and substance
satisfactory to Seller and its counsel, as shall be necessary or desirable in
order to consummate the transactions contemplated hereby, each dated the
Closing Date.
(i) Consulting Contracts. Consulting contracts with Xxxxxx
X. Xxxxxx, Xx. and Xxxxxxx X. Xxxxxx shall have been executed providing each
with no less than annual fees of $100,000, a company-supplied automobile and
fully paid dues at a local country club of their choice
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for a period of two years from the date of the Closing. There shall be no
health insurance provided under such consulting contracts.
ARTICLE VI
INDEMNIFICATION
6.01. Indemnification by Seller. Seller shall defend, indemnify and
hold harmless Buyer and it directors, officers, employees and agents
(each a "Seller Indemnitee") from and against any and all claims, damages,
losses, liabilities, costs and expenses (including without limitation
reasonable attorneys' fees and court costs) that constitute, or arise out of
or in connection with:
(a) any Excluded Assets or any liability not expressly
assumed by Buyer;
(b) any representation or warranty of Seller set forth
herein, in any other Transaction Document or in any certificate delivered in
connection herewith or therewith having been false or misleading in any
material respect as of the time when made (including by omission of material
information necessary to make such representation or warranty not misleading);
(c) any default by Seller in the performance or observance
of any of its covenants or agreement hereunder or under any other Transaction
Document; or
(d) any investigation by any governmental entity which
arises out of the conduct of the Business prior to the Closing Date.
6.02. Indemnification by Buyer. Buyer shall defend, indemnify and hold
harmless Seller and its directors, officers, employees and agents (each a
"Buyer Indemnitee") from and against any and all claims, damages, losses,
liabilities, costs and expenses (including without limitation reasonable
attorneys' fees and court costs) that constitute, or arise out of or in
connection with:
(a) any of the Assumed Liabilities;
(b) any representation or warranty of Buyer set forth herein,
in any other Transaction Document or in any certificate delivered in connection
herewith or therewith having been false or misleading in any material respect
as of the time when made (including by omission of material iinformation
necessary to make such representation or warranty not misleading);
(c) any default by Buyer in the performanance or observance
or any of its covenants or agreements hereunder or under any other Transaction
Document; or
(d) any investigation by any governmental entity which arises
out of the conduct of the Business after the Closing Date.
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6.03. Representation, Settlement and Cooperation. If any investigation
described in Section 6.01(d) or Section 6.02(d) (each a "Proceeding") is
initiated against or with respect to any Seller Indemnitee or Buyer Indemnitee
(each an "Indemnitee") and such Indemnitee intends to seek indemnification from
Seller on the one hand or Buyer on the other hand (each an "Indemnitor"), as
applicable, under this Article on account of its involvement in such
Proceeding, then such Indemnitee shall give prompt notice to the applicable
Indemnitor of such Proceeding; provided, that the failure to so notify such
Indemnitor shall not relieve such Indemnitor of its obligations under this
Article, but shall reduce such obligations by the amount of damages or
increased costs and expenses attributable to such failure to give notice. Upon
receipt of such notice, such Indemnitor shall diligently defend against such
Proceeding on behalf of such Indemnitee at its own expense using counsel
reasonably acceptable to such Indemnitee; provided, that if such Indemnitor
shall fail or refuse to conduct such defense, or such Indemnitee has been
advised by counsel that it may have defenses available to it which are
different from or in addition to those available to such Indemnitor, or that
its interests in such Proceeding are adverse to such Indemnitor's interests,
then such Indemnitee may defend against such Proceeding at such Indemnitor's
expense. Such Indemnitor or Indemnitee, as applicable, may participate in any
Proceeding being defended against by the other at its own expense, and shall
not settle any Proceeding without the prior consent of the other, which consent
shall not be unreasonably withheld. Such Indemnitor and Indemnitee shall
cooperate with each other in the conduct of any such Proceeding.
6.04. Notice and Satisfaction of Indemnification Claims. Indemnification
claims against Seller shall be satisfied out of the Escrow Fund prior to being
satisfied out of any other funds of Seller. No indemnification claim shall be
deemed to have been asserted until the applicable Indemnitor has been given
notice by the Indemnitee of the amount of such claim and the facts on which
such claim is based or, in the case of claims to be satisfied out of the Escrow
Fund, such other notice as is required by the Fund Escrow Agreement. If the
Indemnitee is not Buyer or Seller, then such notice shall be given on behalf of
such Indemnitee by Buyer or Seller, as applicable. Indemnification claims
(other than those satisfied out of the Escrow Fund) shall be paid within thirty
(30) days after the Indemnitor's receipt of such notice and such evidence of
the amount of such claim and the Indemnitor's liability therefor as the
Indemnitor may reasonably request.
6.05. Duration of Indemnification Obligations. Claims for indemnification
under this Article may only be asserted until the two-year anniversary of the
Closing Date, or sixty (60) days after the applicable statute of limitations
period, whichever is sooner.
6.06. Indemnification Threshold. Other than the exemption for
environmental liabilities and claims set forth in Paragraph 1.05(c) of this
Agreement, notwithstanding any other provision hereof, no Indemnitor shall have
any indemnification obligations under this Article unless and until a claim
asserted against such Indemnitor exceeds Ten Thousand Dollars ($10,000)
individually, and unless and until the claims asserted against such Indemnitor
which exceed Ten Thousand Dollars ($10,000), exceed one percent (1%) of the
Purchase Price in the aggregate (the "Threshold Amount"). Thereafter, such
Indemnitor shall be liable for all indemnification claims properly asserted
against it which exceed the Threshold Amount.
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ARTICLE VII
MISCELLANEOUS PROVISIONS
7.01. Amendments. This Agreement may be amended only by a writing signed
by each of the parties, and any such amendment shall be effective only to the
extent specifically set forth in such writing.
7.02. Assignment.
(a) On or before the Closing Date, Buyer shall have the right to
assign all of its interest in this Agreement to a subsidiary or affiliate of
Buyer or any entity in which Buyer or its shareholders owns a majority of the
ownership interests ("NEW CO"). In the event of such assignment, all of the
provisions of this Agreement shall be applicable to and binding upon NEW CO and
Seller in the same manner and to the same extent as those provisions are
applicable to and binding upon Buyer and Seller.
(b) Except as provided in Paragraph 7.02(a), neither this Agreement
nor any right, interest or obligation hereunder may be assigned, pledged or
otherwise transferred by any party, whether by operation of law or otherwise,
without the prior consent of the other party or parties.
7.03. Arbitration. Any claim or controversy arising out of or relating
to this Agreement or the other Transaction Documents shall be decided
exclusively by arbitration in accordance with the following:
(a) Any arbitration proceeding shall take place in the Detroit
Metropolitan Area and shall be conducted in accordance with the then current
rules of the American Arbitration Association, except as otherwise specifically
provided in this Section.
(b) A party which desires to initiate an arbitration proceeding shall
give notice to the other party setting forth such intention together with a
description, in reasonable detail, of the underlying claim or controversy and
the facts out of which such claim or controversy arose.
(c) The parties shall have ten (10) business days after a notice
described in paragraph (b) above is given to agree upon an arbitrator to
conduct such proceeding. If the parties fail to so agree within such ten (10)
day period then, within five (5) business days after the end of such ten (10)
day period, each party shall select an arbitrator and, within ten (10) business
days after the end of such five (5) day period, such two arbitrators shall
select a third arbitrator. Each arbitrator must either have professional
experience relating to the business or legal aspects of the subject of the
arbitration or be a retired judge. No arbitrator shall (i) have any material
interest in the result of the arbitration or (ii) be, or shall ever have been,
an affiliate, equity holder or creditor of, or an attorney, accountant, agent
or consultant for, any party to such arbitration proceeding.
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(d) The parties may obtain such discovery in connection with an
arbitration proceeding as is permitted by, and in accordance with, the then
current Federal Rules of Civil Procedure. The parties shall cooperate with
each other in connection with any proper request for discovery by furnishing to
the requesting party, within ten (10) business days after receipt of such a
request (subject only to mechanical limitations of availability and
reproduction facilities), copies of business and bookkeeping records,
statistics and correspondence reasonably related to the subject matter of the
arbitration. All duplication costs shall be borne by the party requesting the
documents.
(e) The decision of an arbitrator (or, if there are three
arbitrators, the decision of any two arbitrators) shall be final and binding
upon the parties, and judgment may be entered upon any such decision in any
court having jurisdiction.
(f) Attorneys' fees may be awarded to the prevailing party at the
discretion of the arbitrators.
(g) The obligations of the parties under this Section shall be
specifically enforceable and shall survive any termination of this Agreement.
7.04. Counterparts; Telefacsimile Execution. This Agreement may be
executed in any number of counterparts, and by each of the parties on separate
counterparts, each of which, when so executed, shall be deemed an original, but
all of which shall constitute but one and the same instrument. Delivery of an
executed counterpart of this Agreement by telefacsimile shall be equally as
effective as delivery of a manually executed counterpart of this Agreement.
Any party delivering an executed counterpart of this Agreement by telefacsimile
also shall deliver a manually executed counterpart of this Agreement, but the
failure to deliver a manually executed counterpart shall not affect the
validity, enforceability or binding effect of this Agreement.
7.05. Expenses. Except as otherwise specifically provided herein or in
any other Transaction Document, each party shall be responsible for such
expenses as it may incur in connection with the negotiation, preparation,
execution, delivery, performance and enforcement of this Agreement and the
other Transaction Documents. Seller shall be responsible for the cost of the
title insurance policies issued in this transaction. Buyer shall be
responsible for the cost of any baseline environmental assessments. Buyer
shall pay any and all real estate transfer taxes in connection with the
transfer of the Real Property to Buyer. The Deposit Escrow Agent's fees and
costs shall be split equally by Seller and Buyer.
7.06. Further Assurances. The parties shall from time to time do and
perform such additional acts and execute and deliver such additional documents
and instruments as may be required by applicable Governmental Rules or
reasonably requested by any party to establish, maintain or protect its rights
and remedies or to effect the intents and purposes of this Agreement and the
other Transaction Documents without limiting the generality of the foregoing,
each party agrees to endorse (if necessary) and deliver to the other, promptly
after its receipt thereof, any payment or document which it receives after the
Closing Date and which is the property of the other.
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7.07. Governing Law. This Agreement shall be a contract under the laws of
the State of Michigan and for all purposes shall be governed by and construed
and enforced in accordance with the laws of said State.
7.08. Notices. Unless otherwise specifically provided herein, all notices,
consents, requests, demands and other communications required or permitted
hereunder:
(a) shall be in writing;
(b) shall be sent by messenger, certified or registered U.S. mail,
a reliable express delivery service or telecopier (with a copy sent by one of
the foregoing means), charges prepaid as applicable, to the appropriate
address(es) or number(s) set forth below; and
(c) shall be deemed to have been given on the date of receipt by the
addressee (or, if the date of receipt is not a Business Day, on the first
Business Day after the date of receipt), as evidenced by (i) a receipt executed
by the addressee (or a responsible person in his or her office), the records of
the Person delivering such communication or a notice to the effect that such
addressee refused to claim or accept such communication, if sent by messenger,
U.S. mail or express delivery service, or (ii) a receipt generated by the
sender's telecopies showing that such communication was sent to the appropriate
number on a specified date, if sent by telecopier.
All such communications shall be sent to the following addresses or numbers, or
to such other addresses or numbers as any party may inform the others by giving
five Business Days' prior notice:
If to Seller: With a copy to:
Molmec, Inc. Xxxxxxxx Xxxxx, P.C.
0000 X. Xxxxxx Xxxx Xxxx 0000 Xxxxxx Xxxx, Xxxxx 000
Xxxxxx Xxxx, XX 00000-0000 Xxxx, XX 00000-0000
Attn: Xxxxx X. Xxxxx Attn: Xxxxxx X. Xxxxxxxx
Telecopier No.: (000) 000-0000 Telecopier No.: (000) 000-0000
If to Buyer: With a copy to:
LDM Technologies, Inc. Xxxxxxx X. Xxxxx
0000 Xxxxxxxxx Xxxxx Xxxxx Xxxx, Xxxxxxx & Xxxxx, P.L.C.
Xxxxxx Xxxxx, XX 00000 One Detroit Center
Attn: Xxxxxxx X. Xxxx 000 Xxxxxxxx Xxx., Xxxxx 0000
Telecopier No. (000) 000-0000 Xxxxxxx, XX 00000-0000
Telecopier No. (000) 000-0000
7.09. Publicity. Neither party shall make any press release or other
public announcement regarding this Agreement or the other Transaction Documents
or any transaction contemplated
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hereby or thereby until the text of such release or announcement has been
submitted to the other party and the other party has approved the same.
7.10. Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining portions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
7.11. Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of each of the parties and their respective heirs,
successors and permitted assigns.
7.12. Termination.
(a) This Agreement may be terminated at any time prior to the
Closing:
(i) by mutual agreement of Buyer and Seller;
(ii) by Buyer if there has been a material misrepresentation by
Seller hereunder, a material breach by Seller of any of its warranties or
covenants set forth herein and the breach by its nature cannot be cured before
the Closing Date, or if any of the conditions specified in Section 5.02 shall
not have been fulfilled within the time required and shall not have been waived
by Buyer;
(iii) by Seller if there has been a material misrepresentation
by Buyer hereunder, a material breach by Buyer of any of its warranties or
covenants set forth herein and the breach by its nature cannot be cured before
the Closing Date, or if any of the conditions specified in Section 5.03 shall
not have been fulfilled within the time required and shall not have been waived
by Seller; or
(iv) by Seller if the Closing shall not have occurred on or
before December 20, 1996 or such other Closing Date that Seller may have
selected as permitted in Section 5.01; provided that Seller may terminate this
Agreement pursuant to this subparagraph only if the Closing shall not have
occurred on or prior to such date for a reason other than a failure to satisfy
the conditions to Closing set forth in Section 5.02(a) through (j), and 5.02(m)
through (n). In addition to such right to terminate, if the Closing shall not
have occurred on or before December 20, 1996 or such other Closing Date that
Seller may have selected as permitted in Section 5.01, for any reason other
than (a) a material breach of Seller's representations and warranties (as set
forth in Section 5.02(a)); (b) a failure to receive Xxxx Xxxxx Xxxxxx approval,
or (c) Buyer's written notification to Seller prior to November 22, 1996, that
it is not satisfied with the results of its due diligence investigation, then
the Seller shall also be entitled to the Deposit in Section 1.04(a) and in
addition Seller shall also be entitled to pursue any other available legal
remedies.
(b) If this Agreement is terminated by either Seller or Buyer as
provided above, then neither party shall have any further obligations or
liabilities hereunder except for obligations
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or liabilities arising from a breach of this Agreement prior to such
termination or which survive such termination by their own terms.
Notwithstanding anything herein to the contrary, the Confidentiality Agreement
signed by Buyer shall survive any termination, and said Confidentiality
Agreement is incorporated herein.
7.13. Waivers. The due performance or observance by the parties of their
respective obligations hereunder and under the other Transaction
Documents shall not be waived, and the rights and remedies of the parties
hereunder and under the other Transaction Documents shall not be affected, by
any course of dealing or performance or by any delay or failure of any party in
exercising any such right or remedy. The due performance or observance by a
party of any of its obligations hereunder or under any other Transaction
Document may be waived only by a writing signed by the party against whom
enforcement of such waiver is sought, and any such waiver shall be effective
only to the extent specifically set forth in such writing.
7.14. Retained Contracts. To the extent that the Excluded Assets and/or
Excluded Liabilities include any contracts or other agreements relating to the
provision of the products or services of the Business, Buyer agrees to
cooperate with Seller in performing such agreements and Seller agrees to
deliver to Buyer any monies it receives under any such agreement performed by
Buyer promptly upon its receipt thereof.
7.15. Change of Seller's Name. Seller acknowledges that from and after
the Closing Date it shall have no right to use its present corporate name or
any trade names included in the Assets. Therefore, Seller agrees that,
immediately after the Closing, it will take all such action as is necessary to
change its corporate name and to otherwise permit Buyer to have the exclusive
right to such corporate and trade names.
7.16. Entire Agreement. This Agreement and all related documents,
schedules, exhibits, or certificates represent the entire understanding and
agreement between the parties with respect to the subject matter and supersede
all prior agreements or negotiations between the parties. This Agreement may
be amended only in a writing signed by both parties.
ATTEST: MOLMEC, INC.
By: Xxxxxx X. Xxxxxxxx By: Xxxxxx X. Xxxxx
------------------------------ -------------------------------
Title: XXXXXX X. XXXXXXXX Title: XXXXXX X. XXXXX, PRESIDENT
---------------------------- -----------------------------
[Corporate Seal]
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ATTEST: LDM INDUSTRIES INC., d/b/a
LDM TECHNOLOGIES, INC.
By: Xxxxxxx X. Xxxxx By: ???
------------------------------ -------------------------------
Title: XXXXXXX X. XXXXX Title: CEO
---------------------------- -----------------------------
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FIRST AMENDMENT TO
ASSET PURCHASE AGREEMENT
THIS AMENDMENT is made this 27th day of November, 1996, between MOLMEC,
INC., and LDM TECHNOLOGIES, INC., d/b/a and f/n/a LDM INDUSTRIES INC.
RECITALS:
A. MOLMEC, INC., and LDM TECHNOLOGIES, INC., d/b/a and f/n/a LDM
INDUSTRIES INC., wish to amend the Asset Purchase Agreement which was signed by
both parties on November 4, 1996.
B. Pursuant to Section 7.01 of the Asset Purchase Agreement and in
consideration of the mutual covenants and agreements set forth below, the Asset
Purchase Agreement is hereby amended by both parties as follows:
AMENDMENT
1. Section 1.03 is hereby amended in its entirety as follows:
1.03. Assumption of Liabilities. Seller agrees that Buyer assumes no
liabilities of Seller, whether accrued, contingent, known, unknown or
otherwise except for those liabilities listed on Schedule 1.03 and those
liabilities that arise out of or relate to the Assets or the Business as
conducted in the ordinary course of Business through the Closing Date (the
"Assumed Liabilities"). Seller shall be responsible for any liabilities from
acts or omissions which arise prior to the Closing Date and which are not
specifically assumed by Buyer. In addition, wrongful acts and product recalls
relating to any period prior to the Closing Date shall be treated as
undisclosed liabilities of Seller and shall not be assumed by Buyer. Buyer
shall be entitled to treat any such undisclosed liability as a liability
subject to indemnification by Seller, pursuant to Section 6.01 hereof.
Notwithstanding anything in this Agreement to the contrary, Buyer shall assume
any executory obligations of continued performance arising in the ordinary
course of business under any employment contracts, but excluding the employment
contracts of Xxxxxx X. Xxxxx and Xxxxx X. Xxxxx, and excluding any employee
bonus agreements.
2. Schedule 1.03 is amended in its entirety and replaced with the
attached First Amended Schedule 1.03.
3. Section 1.04 is amended in its entirety as follows:
1.04 Purchase Price. Subject to Section 1.05 hereof, the purchase price for
the Assets (the "Purchase Price") shall be Sixty Million Dollars
($60,000,000.00), less the value of the Excluded Assets, plus the amount of the
Assumed Liabilities pursuant to Section 1.03 hereof, plus the amount
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of the reserve accounts set forth on Schedule 1.05 (the amount of the reserve
accounts being reflected in the Sixty Million Dollar portion of the Purchase
Price). The Purchase Price shall be payable by Buyer as follows:
(a) One Million Dollars ($1,000,000) in immediately available funds
(the "Deposit") has been delivered to Comerica Bank (the "Deposit Escrow
Agent"), on the date the Asset Purchase Agreement was fully executed, as
evidence of Buyer's good faith, to be held and disbursed in accordance with
the terms of an Escrow Agreement attached to the Asset Purchase Agreement as
Exhibit A and as subsequently amended (the "Deposit Escrow Agreement"). The
Deposit will be applied to the Purchase Price at the Closing (as defined
hereafter). If Seller terminates this Agreement pursuant to Section
7.12(a)(iii), or if Buyer shall otherwise fail or refuse to complete the
Closing as required by this Agreement, which may or may not result in Seller's
termination of this Agreement pursuant to Section 7.12(a)(iv), then Seller
shall be entitled to the Deposit and the Additional Deposit, as defined below,
if any, and any interest thereon as its sole and exclusive remedy. If this
Agreement is terminated pursuant to Section 7.12(a)(i) or (ii), or if Seller
shall otherwise fail or refuse to complete the Closing as required by this
Agreement, then Buyer shall be entitled to the Deposit and the Additional
Deposit, as defined below, if any, and any interest thereon as its sole and
exclusive remedy.
If the closing shall not have occurred on or before December 20, 1996, then
Buyer shall deliver an additional One Million Dollars ($1,000,000.00) in
immediately available funds (the "Additional Deposit") to the Deposit Escrow
Agent on December 20, 1996, as evidence of Buyer's continued good faith. The
Additional Deposit will be applied to the Purchase Price at the Closing. If
the Closing does not occur by January 31, 1997, then Seller shall be entitled
to the Deposit and the Additional Deposit and any interest thereon as its sole
and exclusive remedy.
(b) One Million Dollars ($1,000,000) in immediately available funds
(the "Escrow Fund") shall be delivered on the Closing Date to a federally
insured commercial bank reasonably acceptable to Buyer and Seller (the "Fund
Escrow Agent"), to be held or disbursed in accordance with the terms of an
Escrow Agreement in substantially the form of Exhibit B (the "Escrow Fund
Agreement").
(c) Five Hundred Thousand Dollars ($500,000) in immediately
available funds (the "Environmental Escrow Fund") shall be delivered on the
Closing Date to a federally insured commercial bank reasonably acceptable to
Buyer and Seller (the "Fund Escrow Agent"), to be held or disbursed in
accordance with the terms of an Escrow Agreement in substantially the form of
Exhibit C (the "Deco-Trim Environmental Escrow Fund Agreement").
(d) Buyer shall retain from the Purchase Price an amount to be
mutually determined by Buyer and Seller prior to the Closing (the "Hold-Back")
to be held by the Buyer until it receives from Seller (i) written confirmation
from the Michigan Employment Security Commission to the effect that all
contributions, penalties and accrued interest due from Seller have been paid in
full; and (ii) a certificate from the Commissioner of Revenue of the Michigan
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Department of Treasury stating that all taxes due to the State of Michigan
including, but not limited to, single business taxes, excise taxes, sales taxes
and use taxes are paid. Promptly after receipt of the items described above,
Buyer will disburse the Hold-Back by delivering Seller a cashier's or certified
check in the amount of the Hold-Back.
(e) The Assumed Liabilities shall be assumed by Buyer by proper
instruments executed at the Closing, and the Assumed Liabilities and the
reserve accounts shall be credited toward the Purchase Price.
(f) The balance in immediately available funds shall be paid to
Seller on the Closing Date.
(g) In the event that the Closing occurs after January 7, 1997, as
provided for in Section 5.01, then in addition to the Purchase Price, Buyer
shall pay to Seller non-refundable interest in the amount of Eight Thousand
Dollars ($8,000.00) for each day after January 7, 1997, including the day of
the Closing, payable weekly in advance beginning on January 7, 1997, but
prorated on a per diem basis for the week of the Closing.
4. Schedule 2.13 is amended in its entirety and replaced with the
attached First Amended Schedule 2.13.
5. Section 3.06 is hereby amended in its entirety as follows:
3.06 Xxxx Xxxxx Xxxxxx Filing. As of the date of this Amendment,
Buyer's Xxxx Xxxxx Xxxxxx application has been approved.
6. Section 4.01 (o)(iii) is hereby added as follows:
(iii) Within seven days of Buyer's receipt of the last of the updated
surveys from Seller for the real property referenced in Schedule 2.11, Buyer
shall determine in its sole reasonable discretion whether (a) there are any
material encroachments or encumbrances; (b) there is proper ingress and egress
to each facility and compliance with zoning, building and use restrictions; (c)
there are easements or rights-of-way which materially interfere with the normal
and reasonable use of the real property, and (d) the aggregate real property
being acquired is materially as represented by Seller to Buyer in on-site
meetings between Seller and Buyer. In the event Buyer determines in its sole
reasonable discretion that there is a material deficiency as set forth above,
Buyer shall be permitted to terminate the Asset Purchase Agreement by written
notice to Seller within said seven day period, receive a refund of its Deposit
and the Additional Deposit, if any, and all accrued interest, and this
Agreement shall be null, void and of no further effect. By entering into this
Amendment to the Asset Purchase Agreement, Buyer is relying upon Seller's
representation that the last of the updated surveys will be delivered to Buyer
by Seller on or before December 9, 1996. All updated surveys shall be
"as-built" surveys showing the location of the plastic injection molding
facilities and all structures situated on the subject real property, along with
all easements, encroachments, ingress and
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egress, shall contain a complete legal description by metes and bounds or lot
description, shall provide a certification from a Michigan licensed land
surveyor to Buyer and the applicable title company, and shall provide such
other information as Buyer shall reasonably require to satisfy itself with
respect to items (a) through (d) above.
7. Section 5.01 is hereby amended in its entirety as follows:
5.01. Closing. The closing of the transaction contemplated
hereby (the "Closing") shall take place on or before January 7, 1997, at the
offices of Xxxxxxxx Xxxxx, P.C., Troy, Michigan, or at such other time or place,
or on such other date as the parties may mutually agree upon, or at Buyer's
option, some other time on or before January 31, 1997, subject to the payment of
interest as provided in Section 1.04(f). If the Closing has not occurred on or
before January 7, 1996, then the Closing shall occur on a Friday in the month of
January, so as to allow a Closing Balance Sheet to be prepared as of a Friday.
The date on which the Closing occurs is referred to herein as the "Closing
Date".
8. Section 5.02(k) is hereby amended in its entirety as follows:
(k) Due Diligence. Subject to the exception for survey due diligence
in Section 4.01(o)(iii), Buyer shall have satisfactorily completed its due
diligence investigation by November 27, 1996 at 5:00 p.m., subject to the
survey due diligence exceptions. Buyer shall notify Seller in writing on or
prior to November 27, 1996 at 5:00 p.m., if it is not satisfied with the
results of its due diligence investigation, whereupon all parties shall be
relieved of their obligations hereunder, and Seller shall be free to
communicate and negotiate with other potential buyers notwithstanding anything
to the contrary contained in this Agreement or the Letter of Intent previously
signed by Seller and Buyer. In such event, Buyer shall be entitled to a return
of the Deposit and any Additional Deposit paid pursuant to Section 1.04(a),
together with any interest thereon.
9. Section 5.02(l) is hereby amended in its entirety as follows:
(l) Xxxx Xxxxx Xxxxxx. Any Xxxx Xxxxx Xxxxxx filing fee shall be
paid by the Buyer. As of the date of this Amendment, Buyer's Xxxx Xxxxx Xxxxxx
application has been approved.
10. Section 5.03(i) is hereby amended in its entirety as follows:
(i) Consulting and Employment Contracts. Consulting and/or
employment contracts with Xxxxxx X. Xxxxxx, Xx. and Xxxxxxx X. Xxxxxx shall have
been executed providing each with annual fees of $10,000, a company-supplied
automobile and fully paid dues at Bloomfield Hills Country Club (for Xxxxxx) and
Orchard Lake Country Club (for Xxxxxx) for a period of two years from the date
of the Closing. There shall be no health insurance provided under such
consulting contracts. Non Competition Agreements with Xxxxxx X. Xxxxxx, Xx. and
Xxxxxxx X. Xxxxxx shall have been executed providing each with annual fees of
$90,000, for a period of two years from the date
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of the Closing. The term of the Non Competition agreement shall be four years
from the Closing. An employment contract with Xxxxx X. Xxxxx for two (2) years
shall have been executed providing for 18 months of severance pay in the event
of a voluntary termination of employment within the first six months after the
Closing or in the event of a termination of employment without cause by Buyer
during the term of the contract.
11. Section 7.12(a)(iv) is hereby amended in its entirety as follows:
(a) This Agreement may be terminated at any time prior to the
Closing:
* * *
(iv) by Seller if the Closing shall not have occurred on or
before January 31, 1997, provided that Seller may terminate this Agreement
pursuant to this subparagraph only if the Closing shall not have occurred on or
prior to such date for a reason other than a failure to satisfy the conditions
to Closing set forth in Section 5.02(a) through (k), and 5.02(m) through (n).
In addition to such right to terminate, if the Closing shall not have occurred
on or before January 31, 1997, for any reason other than (a) a material breach
of Seller's representations and warranties (as set forth in Section 5.02(a));
(b) Buyer's written notification to Seller prior to November 27, 1996 at 5:00
p.m., that it is not satisfied with the results of its due diligence
investigation; or (c) Buyer's written notification to Seller pursuant to Section
4.01 (o)(iii) that there is a material deficiency under the survey due diligence
exception, then the Seller shall also be entitled to the Deposit and the
Additional Deposit and any interest thereon as described in Section 1.04(a).
12. Section 1.05 (c) is hereby amended in its entirety as follows:
(c) Buyer may assert a claim or claims against the Deco-Trim
Environmental Escrow Fund for environmental liabilities or claims as provided in
Section 6.07, and such amounts claimed shall not be subject to the $10,000 and
1% indemnification Threshold Amount established at Section 6.06 of this
Agreement for non-environmental claims.
13. Section 7.05 is hereby amended in its entirety as follows:
7.05. Expenses. Except as otherwise specifically provided herein or
in any other Transaction Document, each party shall be responsible for such
expenses as it may incur in connection with the negotiation, preparation,
execution, delivery, performance and enforcement of this Agreement and the other
Transaction Documents. Seller shall be responsible for the cost of the title
insurance policies issued in this transaction and related surveys. Buyer shall
be responsible for the cost of any baseline environmental assessments. Buyer
shall pay any and all real estate transfer taxes in connection with the transfer
of the Real Property to Buyer. Buyer will pay direct expenses involved with the
assumption by Buyer of the Industrial Revenue Bond on the Hartland facility,
such as an opinion of bond counsel, letter of credit fee, etc..., but Seller
agrees to cooperate with the necessary parties to effect the assumption of the
Industrial Revenue Bond by Buyer. The Deposit Escrow Agent's fees and costs
shall be split equally by Seller and Buyer.
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14. Section 1.05(a)(i) is hereby amended in its entirety as follows:
(a) Closing Balance Sheet.
(i) Within sixty (60) days after the Closing Date, Seller
shall cause its independent accountants to deliver to Seller and Buyer an
audited balance sheet for the Business as of the Closing Date (the "Closing
Balance Sheet"). This Closing Balance Sheet shall reflect the net book value
of the Assets purchased by Buyer, as of the Closing Date, but if the Closing
Date is between December 31, 1996 and January 7, 1996, the Closing Balance
Sheet shall reflect the net book value of the Assets purchased by Buyer, as of
December 31, 1996. For purposes of this Agreement, the term "net book value"
shall mean an amount equal to the Assets less the Assumed Liabilities,
reflected on the September 29, 1996 balance sheet or the Closing Balance Sheet,
as the context indicates, with inventory being accounted for on a first in
first out basis for both balance sheets. In addition, the Closing Balance
Sheet will not include any environmental reserve. Buyer and Seller each shall
designate a representative to assist and shall cooperate with each other and
the independent accountants in preparing the Closing Balance Sheet, and Buyer
shall pay all costs assessed by the independent accountants in connection with
preparation and delivery of the Closing Balance Sheet.
15. The Deposit Escrow Agreement attached as Exhibit A to the Asset
Purchase Agreement is hereby amended in its entirety and replaced with the
attached Second Amendment to Escrow Agreement (Exhibit A).
16. Section 5.02(h)(vii) is hereby amended in its entirety as follows:
(vii) an Assignment of Lease for the Avon plant, together with a
statement from Seller, certified to Buyer, that Seller is in compliance with its
obligations under Paragraph 7 of the Lease with respect to environmental
matters, such as: not contaminating the site, taking all actions necessary to
investigate, and clean up and elimination of the source of any past or present
contamination. In addition, Seller shall obtain a certificate from the Landlord
indicating that the building is in compliance with "first-class order and
repair", as required by the Lease, and that the Landlord has made no request
that Tenant perform any work or make any repairs in the preceding 60 days.
Notwithstanding the above, if the Lease is amended to the satisfaction of the
Buyer, and if appropriate acknowledgments are provided by Landlord which
eliminate the Tenant's duty to repair, maintain, and/or improve the building,
then the necessity of such Seller statement and Landlord certificate may be
waived by Buyer.
17. Section 6.06 is hereby amended in its entirety as follows:
6.06. Indemnification Threshold. Except for environmental claims
generally and separate provisions for environmental liabilities at the Deco Trim
plant set forth in Section 6.07 of this Agreement, notwithstanding any other
provision hereof, no Indemnitor shall have any indemnification obligations under
this Article unless and until a claim asserted against such
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Indemnitor exceeds Ten Thousand Dollars ($10,000) individually, and unless and
until the claims asserted against such Indemnitor which exceed Ten Thousand
Dollars ($ 10,000), exceed one percent (1%) of the Purchase Price in the
aggregate (the "Threshold Amount"). Thereafter, such Indemnitor shall be
liable for all indemnification claims properly asserted against it which exceed
the Threshold Amount. Buyer may assert a claim or claims against the Escrow
Fund for any environmental liabilities or claims related to any of the Real
Property, with the exception of the Deco-Trim facility.
18. Section 6.07 is hereby inserted as follows:
6.07. Environmental Escrow. Seller shall defend, indemnify and hold
harmless Buyer and its shareholders, directors, officers, employees and agents
(each a "Seller Indemnitee") from and against any and all claims, damages,
losses, liabilities, costs and expenses (including without limitation reasonable
attorneys' fees and court costs) that arise out of or in connection with any
environmental matter relating to the Real Property owned or leased by Seller.
(a) An Environmental Escrow Fund is established in
Section 1.04(c) to satisfy the cost of environmental claims at the Deco-Trim
facility only. The Seller and its shareholders, directors, officers,
employees and agents shall have no personal liability to a Seller Indemnitee
for any environmental claims.
(b) Claims for indemnification under this Section may only be
asserted until the six year anniversary of the Closing Date. In the event there
are funds remaining in the Environmental Escrow Fund after the remediation of
the Deco-Trim property has been completed to the reasonable satisfaction of
Buyer and the Michigan Department of Environmental Quality ("DEQ"), such excess
shall be paid to Seller at or prior to the end of the six year anniversary of
the Closing Date, if no other environmental claims have been made and remain
outstanding. The work at the Deco-Trim plant shall be deemed completed when the
DEQ provides Seller with a "clean closure" letter, or substantial equivalent,
all xxxxx are decommissioned and removed, the site does not require further
remediation, and Buyer has given its written approval of the remediation, which
written approval shall not be unreasonably withheld in the event the
aforementioned DEQ approval is received and all xxxxx are decommissioned and
removed. Seller's environmental consultant shall keep Buyer's environmental
consultant apprised of the remediation process via periodic written progress
reports, provided not less than every six months.
(c) The funds in the Deco-Trim Environmental Escrow Fund shall
be released periodically and payable direct to Seller's environmental consultant
(currently Xxxxxxx Environmental) upon approval by Buyer's environmental
consultant (currently IT Corporation) after Buyer's environmental consultant
approves the request for payment and invoices. Buyer's environmental consultant
shall be reasonable and cooperative with respect to exercising its approval of
Seller's environmental consultant's request for payment of invoices. After the
Closing, all costs of Seller's and Buyer's environmental consultants shall be
paid from the Deco-Trim Environmental Escrow Fund. Seller and Buyer shall be
permitted to change their respective environmental
7
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consultants with other environmental consultants, if the other party reasonably
approves of such successor environmental consultant.
(d) Seller hereby agrees to indemnify, defend and hold harmless
Buyer for any and all actions, demands, lawsuits, complaints or claims relative
to (i) Buyer's involvement in the oversight of this environmental remediation,
and (ii) the contaminated groundwater at the Deco-Trim facility, surrounding
property and contiguous property and/or the environmental condition of the site
and adjoining sites, whether known or unknown, whether brought by the DEQ, a
third party, a citizens group, or Buyer for Seller's failure to properly
implement the remediation contemplated herein.
(e) If Seller fails or refuses to direct the payment of funds
necessary to complete the remediation or satisfaction of environmental claims to
the satisfaction of Buyer, then Buyer may make claims against the Deco-Trim
Environmental Escrow Fund in the same manner as Seller, as provided in the
Deco-Trim Environmental Escrow Agreement. In such case, Seller shall receive
notice of Buyer's filed claim against the Fund, in the same manner as Buyer
would receive for claims made by Seller.
19. Section 1.06 is hereby amended in its entirety as follows:
1.06. Assignment of Value. Buyer and Seller shall use their best
efforts to comply with the applicable requirements of the Internal Revenue Code
of 1986, as amended (the "Code"), by preparing a schedule to be executed at the
Closing (defined below) reflecting the allocation of the total price paid to the
respective Assets, which allocation shall be used by them in preparing their
respective income tax returns; provided, that any failure to agree on such
allocation shall not relieve either party of its obligations hereunder. Seller
and Buyer agree that such allocation for all Real Property shall, at Buyer's
option, be at fair market value, and that the total price paid by Buyer which
exceeds the net book value of the Assets will be allocated to goodwill.
20. Section 2.15 (m) is hereby amended in its entirety as follows:
(m) If Seller terminates any employment relationships or Employee
Benefit Plans in connection with this Agreement, Seller will comply with all
applicable federal and state laws, rules and regulations governing the
termination of employment and/or termination of the Employee Benefit Plan. Buyer
anticipates offering employment to nearly all of Seller's employees. If certain
of Seller's employees are not offered employment by Buyer, Buyer agrees to
indemnify Seller and Seller's Shareholders for any liability arising out of the
termination of said employees (excluding Xxxxxx X. Xxxxx and Xxxxx X. Xxxxx),
and such indemnification shall be paid directly by Buyer, on a monthly basis,
and shall not be paid from the Escrow Fund, and shall not be subject to any
threshold amount. Buyer and Seller specifically agree that Buyer will not be
liable for any amounts owed currently or in the future to Vamos and Xxxxx under
their current employment contracts with Seller. If a transfer and assumption of
employment agreements and/or Employee Benefit Plans is
8
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requested by Buyer, Seller will execute any and all documents reasonably
requested by Buyer to assist in the transfer of such employment agreements and
Employee Benefits Plans.
21. Section 6.05 is hereby amended in its entirety as follows:
6.05. Duration of Indemnification Obligations. Claims for
indemnification under this Article may only be asserted until the two-year
anniversary of the Closing Date, or sixty (60) days after the applicable statute
of limitations period, whichever is sooner, except that environmental claims
shall be subject to the limitation period set forth in Section 6.07.
Except for the above amended provisions, the parties reaffirm all of the
provisions of the Asset Purchase Agreement dated November 4, 1996 and the same
shall remain in full force and effect.
ATTEST: MOLMEC, INC.
By: ??? By: Xxxxxx X. Xxxxx
---------------------------- -----------------------------
Title: Title: President
------------------------- --------------------------
[Corporate Seal]
ATTEST: LDM TECHNOLOGIES, INC., d/b/a
LDM INDUSTRIES INC.
By: ??? By: Xxx Xxxxxx
---------------------------- -----------------------------
Title: Title: Chairman
------------------------- --------------------------
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39
SECOND AMENDMENT TO
ASSET PURCHASE AGREEMENT
THIS SECOND AMENDMENT is made this 23 day of December, 1996, between
MOLMEC, INC., and LDM TECHNOLOGIES, INC., d/b/a and f/k/a LDM INDUSTRIES INC.
RECITALS:
A. MOLMEC, INC., and LDM TECHNOLOGIES, INC., d/b/a and f/k/a LDM
INDUSTRIES INC., wish to amend the Asset Purchase Agreement dated November 4,
1996, and amended via that certain First Amendment to Asset Purchase Agreement
dated November 27, 1996.
B. Pursuant to Section 7.01 of the Asset Purchase Agreement and in
consideration of the mutual covenants and agreements set forth below, the Asset
Purchase Agreement, as amended, is hereby further amended by both parties as
follows:
AMENDMENT
1. The fourth sentence of Section 2.10, entitled Environmental Matters,
is hereby deleted and the following sentence is inserted in its place:
Seller has not used Hazardous Materials (as hereinafter defined) on or
affecting the Real Property in any manner which violates federal, state
or local laws, ordinances, statutes, rules, regulations or judgments
governing the use, storage, treatment, handling, manufacture,
transportation or disposal of Hazardous Materials ("Environmental
Laws") or received any notice of any violation of Environmental Laws
and, to the best of Seller's knowledge, no prior owner of the Real
Property or any current or prior occupant has used Hazardous Materials
on or affecting the Real Property in any manner which violates
Environmental Laws, except as disclosed in those certain environmental
reports prepared by ATEC Environmental Consultants, Testing Engineers
and Consultants, XxXxxxxx & Associates and Xxxxxxx Environmental
(collectively, the "Environmental Reports").
2. New Section 4.04, entitled Environmental Work Prior to Closing is
hereby added which reads as follows:
4.04. Environmental Work Prior to Closing. Seller hereby agrees to
perform the surficial soil cleanup referenced in the various
International Technology Corporation Environmental Site Assessments
("IT ESAs") prior to Closing. Seller shall sign all manifests
necessary or appropriate for the transport of the contaminated soil
associated with the surficial soil removal operations.
40
Seller shall be responsible for any and all testing and analysis of
the contaminated soils, and shall be solely responsible for the
selection of the landfill for disposal of the contaminated soil. The
disposal of the contaminated soil shall be done in compliance with all
applicable laws, rules and regulations.
3. New Section 7.17, entitled Environmental Work to be Begun Prior to
Closing and Completed After Closing, is hereby added which reads as follows:
7.17. Environmental Work to be Begun Prior to Closing and Completed
After Closing. Seller shall be responsible for the diligent
implementation of the Remedial Action Plan, obtaining clean closure and
decommissioning all xxxxx at the Deco-Trim property, all at Seller's
cost, which costs shall be paid out of the Environmental Escrow Fund.
Seller shall be responsible for diligently obtaining the "clean
closure" letter, or substantial equivalent, from the Michigan
Department of Environmental Quality ("DEQ"). Seller has provided Buyer
with a copy of the proposed Remedial Action Plan submitted to the DEQ
and shall provide Buyer with the written approval of the Remedial
Action Plan provided by the DEQ upon receipt, as well as any other
correspondence to or from the DEQ concerning the approval,
implementation or amendment to the Remedial Action Plan. Seller shall
also provide Buyer with any amendments to the Remedial Action Plan and
all sampling and analytical data.
Except for the above amended provisions, the parties reaffirm and ratify
all of the terms, conditions and provisions of the Asset Purchase Agreement
dated November 4, 1996, and the First Amendment to Asset Purchase Agreement
dated November 27, 1996, and the same shall remain in full force and effect.
ATTEST: MOLMEC, INC.
By: ??? By: Xxxxxxx X. Xxxxxx
----------------------------- ------------------------------
Title: Title: Vice President Engineering
-------------------------- ---------------------------
By: Xxxxxx X. Xxxxx
------------------------------
Title: President
---------------------------
[Corporate Seal]
ATTEST: LDM TECHNOLOGIES, INC., d/b/a and
f/k/a LDM INDUSTRIES INC.
By: ??? By: ???
---------------------------- ------------------------------
Title: Title: Chairman/Secretary
-------------------------- ---------------------------
-2-
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THIRD AMENDMENT TO
ASSET PURCHASE AGREEMENT
THIS THIRD AMENDMENT is made this 21 day of January, 1997, between MOLMEC,
INC., and LDM TECHNOLOGIES, INC., d/b/a and f/k/a LDM INDUSTRIES INC.
RECITALS:
A. MOLMEC, INC., and LDM TECHNOLOGIES, INC., d/b/a and f/k/a LDM
INDUSTRIES INC., wish to amend the Asset Purchase Agreement which was signed by
both parties on November 4, 1996, as subsequently amended by a First Amendment
dated November 27, 1996 and a Second Amendment dated December 23, 1996.
B. Pursuant to Section 7.01 of the Asset Purchase Agreement and in
consideration of the mutual covenants and agreements set forth below, the Asset
Purchase Agreement is hereby amended by both parties as follows:
AMENDMENT
1. Section 1.01 is hereby amended in its entirety as follows:
1.01. Purchase and Sale of Assets. On the closing date (defined below),
Seller shall sell to Buyer, and Buyer shall purchase from Seller, all of
Seller's rights, title and interest in and to the following assets of Seller
(collectively, the "Assets"):
(a) the real property listed on Schedule 1.01, the buildings and
other improvements constructed thereon and all other rights associated therewith
(collectively, the "Real Property");
(b) all equipment, machinery, fixtures, tools, dies, patterns,
vehicles, computer hardware and software and furniture (collectively, the
"Equipment"), and all supplies, spare parts and warranties relating to any of
the Equipment;
(c) all raw material, work-in-process and finished goods inventory
of the Business (collectively, the "Inventory");
(d) all patents, registered and unregistered trademarks, service
marks, logos, corporate and trade names and registered and common law
copyrights, and all applications therefor, used and useful in connection with
the Business (collectively, the "Intellectual Property");
(e) all inventions, discoveries, techniques, processes, methods,
formulae, designs, trade secrets, confidential information, know-how and ideas
used or useful in connection with the Business;
(f) all accounts receivable of the Business (the "Receivables")
and all other
42
claims, causes of action, choses in action and rights of recovery and setoff
relating to the Business or any of the Assets;
(g) all bids, offers, leases, licenses, contracts, agreements and
business arrangements relating to the Business or any of the Assets (the
"Business Agreements");
(h) all permits, licenses, franchises, certificates,
authorizations, consents and approvals obtained from or issued by any
governmental entity and which are necessary or desirable for the ownership or
operation of the Business or the ownership, operation or use of any of the
Assets (collectively, the "Business Permits");
(i) all books, records, files, ledgers, drawings, specifications
and manuals relating to the Business or any of the Assets, all advertising
materials relating to the Business and all other information relating to the
Business or any of the Assets, regardless of the form in which such information
appears;
(j) all goodwill of the Business or associated with any of the
Assets;
(k) all other assets of Seller, tangible or intangible.
(l) all cash, cash equivalents and amounts held on deposit in all
savings, checking, money market, investment and other similar accounts.
2. Schedule 1.02 is amended in its entirety and replaced with the
attached First Amended Schedule 1.02.
3. The first paragraph of Section 1.04 is amended in its entirety as
follows:
1.04 Purchase Price. Subject to Section 1.05 hereof, the purchase price
for the Assets (the "Purchase Price") shall be Sixty Million Dollars
($60,000,000.00), less the value of the Excluded Assets (which Buyer and Seller
stipulate to be Three Hundred Fifty Thousand Dollars ($350,000.00) for purposes
of the Closing until the actual value is determined as of the date of the
Closing per Section 1.05 (a) (iii)), plus the amount of the Assumed Liabilities
pursuant to Section 1.03 hereof, plus the amount of the reserve accounts set
forth on Schedule 1.05 (the amount of the reserve accounts being reflected in
the Sixty Million Dollar portion of the Purchase Price). The Purchase Price
shall be payable by Buyer as follows:
4. Section 1.04(d) is amended in its entirety as follows:
(d) Buyer shall retain from the Purchase Price Fifty Thousand
Dollars ($50,000.00) (the "Hold-Back") to be held by the Buyer until it receives
from Seller (i) written confirmation from the Michigan Employment Security
Commission to the effect that all contributions, penalties and accrued interest
due from Seller have been paid in full; and (ii) a certificate from the
Commissioner of Revenue of the Michigan Department of Treasury stating that all
taxes due to the State of Michigan including, but not limited to, single
business taxes,
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excise taxes, sales taxes and use taxes are paid. Promptly after
receipt of the items described above, Buyer will disburse the Hold-Back by
delivering Seller a cashier's or certified check in the amount of the
Hold-Back.
5. Section 1.04(h) is hereby added as follows:
(h) In the event that the Closing occurs after January 17, 1997,
as provided for in Section 5.01, but prior to January 24, 1997, then in
addition to the Purchase Price and the interest provided for in Section
1.04(g), Buyer shall pay to Seller at Closing a payment in the amount of Three
Thousand Dollars ($3,000.00) (the "Balance Sheet Adjustment Fee") for each day
after January 17, 1997, up to and including the day of the Closing. In the
event that the Closing occurs after January 24, 1997, as provided for in
Section 5.01, but prior to January 31, 1997, then in addition to the Purchase
Price and the interest provided for in Section 1.04(g), Buyer shall pay to
Seller at Closing a Balance Sheet Adjustment Fee in the amount of Three
Thousand Dollars ($3,000.00) for each day after January 24, 1997, up to and
including the day of the Closing. If the Closing occurs on January 24, 1997,
or on January 31, 1997, there shall be no Balance Sheet Adjustment Fee.
6. Section 1.05(a)(i) is hereby amended in its entirety as follows:
(a) Closing Balance Sheet.
(i) Within sixty (60) days after the Closing Date, Seller shall
cause its independent accountants to deliver to Seller and Buyer an
audited balance sheet for the Business ("Closing Balance Sheet") as of the
Closing Balance Sheet Date, which shall be determined as follows: if the
Closing occurs on or between January 17, 1997 and January 23, 1997, the Closing
Balance Sheet Date shall be January 17, 1997; if the Closing occurs on or
between January 24, 1997 and January 30, 1997, the Closing Balance Sheet Date
shall be January 24, 1997; if the Closing occurs on January 31, 1997, the
Closing Balance Sheet Date shall be January 31, 1997. The Closing Balance Sheet
shall reflect the net book value of the Assets purchased by Buyer, as of the
Closing Balance Sheet Date. For purposes of this Agreement, the term "net book
value" shall mean an amount equal to the Assets less the Assumed Liabilities,
reflected on the September 29, 1996 balance sheet or the Closing Balance Sheet,
as the context indicates, with inventory being accounted for on a first in
first out basis for both balance sheets. In addition, the Closing Balance
Sheet will not include any environmental reserve. Buyer and Seller each shall
designate a representative to assist and shall cooperate with each other and
the independent accountants in preparing the Closing Balance Sheet, and Buyer
shall pay all costs assessed by the independent accountants in connection with
preparation and delivery of the Closing Balance Sheet.
7. Section 1.05(a)(iii) is hereby amended in its entirety as follows:
(iii) The Purchase Price shall be increased or decreased by an
amount equal to the amount by which the net book value of the Assets on
the Closing Balance Sheet Date (as reflected on the audited Closing Balance
Sheet) is greater than or less than the net book
3
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value of the Assets on September 29, 1996 (as reflected on Seller's
financial statements for the period ended September 29, 1996). The Purchase
Price shall also be increased or decreased by the difference between the actual
value of the Excluded Assets and the stipulated value for purposes of the
closing of Three Hundred Fifty Thousand Dollars ($350,000.00), but only if the
difference is greater than One Thousand Dollars ($1,000.00). The actual value
of the Excluded Assets shall be determined within sixty (60) days after the
closing by the insurance companies which issued the policies.
8. The first paragraph of Section 2.04 and Section 2.04(b) are hereby
amended in their entirety as follows:
2.04 No Breach, Default, Violation or Consent. Assuming that
Seller obtains all consents with respect to the assignment or transfer
of Business Agreements, Intellectual Property and Business Permits which are
listed on Schedule 5.02(c) (except for the two (2) Xxxxxx licenses disclosed on
Schedule 2.13 for which prior written consent has been waived by Buyer), the
execution, delivery and performance by Seller of this Agreement and the other
Transaction Documents do not and will not:
***
(b) breach or result in a default (or an event which, with the
giving of notice or the passage of time, or both, would constitute a
default) under, require any consent under or give to others any rights of
termination, acceleration, suspension, revocation, cancellation or amendment of
any Business Agreement or Business Permit, or any agreement representing
indebtedness for borrowed money or any trust indenture pursuant to which Seller
has issued debt obligations, except as previously disclosed to Buyer with
respect to the License Agreements with Xxxxxx;
9. Section 5.01 is hereby amended in its entirety as follows:
5.01. Closing. The Closing of the transaction contemplated hereby
(the "Closing") shall take place on or before January 31, 1997, at the
offices of Xxxxxxxx Xxxxx, P.C., Troy, Michigan, or at such other time or
place, or on such other date as the parties may mutually agree upon, subject to
the payment of interest as provided in Section 1.04(f) and the Balance Sheet
Adjustment Fee as provided in Section 1.04(h). The date on which the Closing
occurs is referred to herein as the "Closing Date".
10. Section 5.02(c) is hereby amended in its entirety as follows:
(c) Consent and Approvals. Seller shall have obtained or made each
consent to assignment or transfer, authorization, approval, exemption,
filing, registration or qualification, as are listed on Schedule 5.02(c).
11. Schedule 5.02(c) is amended in its entirety and replaced with the
attached First Amended Schedule 5.02(c).
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Except for the above amended provisions, the parties reaffirm all of the
provisions of the Asset Purchase Agreement dated November 4, 1996 and
the Amendments thereto and the same shall remain in full force and effect.
ATTEST: MOLMEC, INC.
By: ??? By: ???
-------------------------------- -------------------------------
Title: Title: Secretary
---------------------------- ----------------------------
[Corporate Seal]
ATTEST: LDM TECHNOLOGIES, INC., d/b/a
LDM INDUSTRIES INC.
By: ??? By: ???
-------------------------------- -------------------------------
Title: ??? Title: ???
------------------------------ ----------------------------
5
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FIRST AMENDED
SCHEDULE 1.02
Excluded Assets
All life insurance policies insuring Xxxxxx X. Xxxxxx, Xx. and Xxxxxxx
X. Xxxxxx.
47
FIRST AMENDED
SCHEDULE 5.02(c)
Consents and Approvals
1. Consent to Assignment of Lease by Owner of Real property leased in
Rochester Hills, Michigan, as disclosed on Schedule 2.11(c).
2. Consent to Assignment of purchase orders by the ten largest customers of
Molmec.
3. Xxxx Xxxxx Xxxxxx filing.
4. Michigan Department of Treasury Form L-2460. Property Transfer Affidavit.
