ASSET PURCHASE AGREEMENT
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This Asset Purchase Agreement, ("Agreement") is made and entered into this
30th day of December, 2004, by and between Advanced Imaging Systems, LLC, a
Delaware limited liability company (hereinafter referred to as "Seller") and RBE
& SJC, Inc., a Florida corporation, (hereinafter referred to as "Buyer").
W I T N E S S E T H
WHEREAS, Seller is the sole owner of all of certain tangible and
intangible commercial printing assets (hereinafter referred to as the "Assets");
and
WHEREAS Buyer desires to purchase the Assets and certain licenses,
permits, leases, consents, waivers, contracts, rights and like property held by
the Seller,
NOW THEREFORE in consideration of the mutual promises and covenants set
out and contained herein, the parties hereto, intending to be bound thereby,
hereby agree as follows:
ARTICLE I.
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ASSETS TO BE CONVEYED
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Subject to the terms and conditions hereinafter set forth, Seller shall
sell, transfer, convey and assign to Buyer, and Buyer shall purchase, accept and
receive from Seller as of the Effective Date (as hereinafter defined):
A. The licenses, authorizations, permits and the like (as set forth in
Exhibit A. attached hereto and made a part hereof); and
B. The certain personal property (as listed in Exhibit B, attached
hereto and made a part hereof), and any additions thereto or substitutions of at
least equivalent quality and equivalent value subject to Buyer's consent which
shall not be unreasonably withheld therefor, free and clear of any and all liens
and encumbrances.
1. This personal property includes:
a. The furniture, fixtures, machinery, equipment, supplies
and other tangible personal property owned by the Seller and used or useful in
the Seller's operation of the commercial printing aspect of its business,
together with any replacements thereof or additions thereto made between the
date hereof and the Closing Date (as hereinafter defined), less any retirements
made in the ordinary and usual course of business;
b. All other property developed or acquired by the Seller
through the Closing for and used for or to be used in the operation of the
commercial printing aspect of its business, including but not limited to all of
the ownership, title and intellectual rights to the Seller's printing
proprietary software, firmware, source codes, utilities and the like
programming.
c. Seller's commercial printing inventory, work in
progress, supplies, office equipment, business operations and customer accounts
as set forth in Exhibit B.
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d. Seller's trade name "Advanced Imaging Systems", Seller's
telephone numbers and other like miscellaneous items. Notwithstanding, Seller
may use the trade name conveyed after the Closing Date as necessary for tax
returns and other governing filings.
2. This personal property does NOT include:
a. Cash on hand or in banks.
b. Deposits and deferred charges of the Seller's commercial
printing business in accordance with generally accepted accounting principles as
of the Closing Date.
c. Receivables and payables of the Seller at Closing.
d. Property of the Seller which is used and useful in
aspects of its operations and business other than commercial printing.
e. Property of the Seller, located at Seller's location,
0000 X.X. 00xx Xxxxxxx, Xxxx Xxxxxxxxxx, Xxxxxxx, used only indirectly or
incidentally, in the operation of its commercial printing business.
C. All documents normally kept by the Seller, or required to be kept in
the Seller's commercial printing business files pursuant to any applicable rules
or regulations, including agreements, contracts, equipment leases, bids,
quotations, proposals, instruments, manuals, guidebooks, price books, price
lists, customer and subscriber lists, supplier lists, sales records,
correspondence and other documents, books, records, papers, files and data of
Seller; in sum, copies of all business records relating solely to the operation
of the Seller's commercial printing business, but not including financial and
other records pertaining to Seller's other operations or affairs. Both Buyer and
Seller shall have full access after Closing to such pertinent records as may be
held by the other party, for the purpose of completing their bookkeeping and
accounting procedures and for other similar purposes for which such access is
reasonably necessary or proper. Buyer shall not be obligated to perform
contracts of Seller not disclosed to Buyer by Seller at or before the Closing
Date.
D. Seller shall and does grant to the Buyer the right to employ all of
the Seller's commercial printing employees reflected in Exhibit E (attached
hereto and made a part hereof) commencing on the Closing Date and following the
closing of the asset purchase transaction contemplated herein. In the event the
Buyer elects to employ such personnel, Seller shall terminate its employment of
such employee(s).
E. Buyer shall assume and shall pay all of the Seller's overhead
related to its commercial printing business up to ninety (90) days following the
Closing Date of the asset purchase transaction contemplated herein (the
"Transition Period"). The Buyers obligation under this Article I., paragraph E.
is intended to relieve the Seller of all expenses arising from its commercial
printing business operations for the period during which the parties contemplate
the Buyer's orderly removal of the purchased Assets to the Buyer's premises
elsewhere. Buyer's obligations under this paragraph, and under Article III.
paragraph F. infra, shall terminate when all tangible personal property
purchased pursuant to this Agreement has been removed from Seller's above
location and in any event, shall terminate no later than ninety (90) days after
the Closing Date.
F. Following the Closing Date, Buyer shall aid and assist the Seller in
its collection and receipt of receivables open at Closing (as reflected in
Schedule__ ) and retained by the Seller in this contemplated asset purchase
transaction. Seller shall reasonably request Buyer's assistance in this regard
as needed. Buyer upon such request shall refrain from providing further services
to any account which is, upon such request, in arrears in its payables to the
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Seller. Any receipts by the Buyer from such an account shall be transferred by
the Buyer to the Seller upon receipt.
G. All such steps will be taken as may be required to put Buyer in
actual possession and operating control of the purchased assets promptly
following Closing. During the Transition Period, Buyer shall be permitted full,
unrestricted access to Seller's premises in order to enable Buyer free and
unfettered use of the purchased assets and to do business at said premises.
ARTICLE II.
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PURCHASE PRICE
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A. The total purchase price for the assets purchased hereunder (the
"Assets") shall be the sum of Three Hundred Thirty Five Thousand and 00/100
($335,000.00) Dollars as further increased by the Closing adjustment reflected
in paragraph A. (ii) of this Article II below. The purchase price shall be paid
by the Buyer at the Closing as follows:
(i) The purchase price of the tangible and the intangible
personal property purchased, other than inventory, work in progress and
supplies, is $335,000, payable $135,000 in cash or cash equivalent at Closing,
and delivery by the Buyer of an executed promissory note (" Promissory Note") in
the original principal amount of $ 200,000 bearing interest at the annual rate
of six (6%) percent and payable, principal and interest, in twenty-four (24)
equal monthly payments of $__________, beginning on the first day of the month
following the Closing date and continuing thereafter until fully paid. The Buyer
shall be entitled to a right of "set-off" against the Promissory Note resulting
from the actual breach of any of the Seller's representations and/or warranties
and as otherwise consistent with Article IX of this Agreement The original
principal of the Promissory Note shall be reduced by the amount of a certain
payable of the Seller, due to an affiliate of the Buyer under common control
with the Buyer, at the time of Closing. At Closing, the Buyer shall deliver to
the Seller, inter alia, an invoice from the affiliate marked "Paid In Full",
together with duly executed certificates of the Buyer and the Buyer's affiliate
authorizing the Seller's payment of the payable to the Buyer's affiliate in the
manner set forth in this Article II. A.(i)
(ii) The total purchase is allocated $235,000 for the purchase of
tangible assets and $100,000 for the purchase of intangible assets and shall be
adjusted and increased, in cash or cash equivalent, at Closing, following, and
consistent with, a valuation, determined jointly by the parties immediately
before Closing, of the inventory, work in progress and supplies conveyed by the
Seller to the Buyer in the transaction contemplated in this Asset Purchase
Agreement. The parties agree that for any item of work that is required to be
completed after the Closing Date, the Buyer shall be entitled to receive the
proportionate share of the total fees charged by the Seller consistent with the
amount of work that remains to be completed at the Closing Date for such item.
B. Time is of the essence. The parties expressly acknowledge and agree
that in the event of a subsequent breach of any of the terms and conditions of
this Asset Purchase Agreement by either of the parties, which breach directly or
indirectly results in failure to close the transaction contemplated herein
within thirty (30) days after the Closing Date, determination of consequent
damages therefrom to the non-breaking party will not be readily determinable.
C. The Promissory Note reflected in paragraph A. of this Article II.
is, and shall be, secured by all of the assets of the Buyer in existence or
after acquired, and repayment of the full principal and interest payable or
accrued, is personally guaranteed by Xx. Xxxxxxx Xxxxx, sole shareholder and
controlling person of the Buyer.
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ARTICLE III.
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SELLER'S REPRESENTATIONS AND WARRANTIES
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The Seller makes the following representations and warranties and assures
the Buyer of their accuracy and completeness intending thereby to assume the
Buyer's reliance thereon.
A. On the Closing Date, Seller is and will be the holder of permits,
licenses and other authorizations required for the operation of its business, as
set forth in Exhibit A. These permits, licenses and other authorizations are and
shall be in full force and effect, free and clear of legal disqualifications or
other restrictions of such nature as would materially limit the full operation
of the Seller's business as presently conducted.
B. On the Closing Date, the Seller will be the sole owner and only
person, firm or entity entitled to immediate possession of all the Assets and
any replacements thereof and additions thereto, free and clear of all liens,
mortgages, encumbrances, restrictions and title defects which would interfere
with Buyer's quiet use thereof.
C. On the Closing Date, there will be not more than normal
wear-and-tear of the Assets and any replacements thereof and additions thereto.
On the Closing Date, all equipment and other tangible personal property shall be
conveyed in good working condition.
D. On the Closing Date, all of the Seller's employees reflected in
Exhibit E hereto will have been paid all wages and salaries earned by them up to
the Closing Date, including commissions, bonuses and incentive compensation, if
any.
E. As of the date first above written, and on the Closing Date, there
is no litigation of any nature pending, or to the knowledge of the Seller
threatened, against the Seller or its tangible, intangible or intellectual
property which might materially and adversely affect the Assets, or which might
materially and adversely affect the enjoyment or use thereof by the Buyer.
F. The Seller has now and will continue to have, between the date
hereof and the date of their removal by the Buyer, casualty insurance coverage
on the assets purchased and conveyed under this Agreement to cover any loss
and/or necessary replacement thereof. The maximum period of the Seller's
coverage obligation under this Article III. paragraph F. shall be ninety (90)
days after the Closing Date.
G. Prior to the Closing Date, the Seller's commercial printing business
shall be operated in the normal and usual manner and in the ordinary course of
business. No increase shall be made in the compensation payable or to become
payable to any Seller's commercial printing employee or agent of the Seller's
commercial printing business except in the ordinary course of business. No new
employment contract shall be entered into between the Seller and any of its
employees, unless the same be terminable at will and without penalty. No
contracts or other commitments, other than those made in the ordinary course of
business, shall be entered into on or after the date hereof by the Seller
affecting, directly or indirectly, the Seller's existing commercial printing
business. The Seller will use its best efforts to preserve for the Buyer the
Seller's commercial printing accounts and its present business reputation.
H. Prior to the Closing Date, the Seller will give the Buyer or
representatives of the Buyer reasonable access during normal business hours to
the properties, titles, contracts, books, records and commercial affairs of the
Seller relating to the operation of the Seller's existing commercial printing
business.
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I. The Seller is as of the date hereof, and will be on the Closing
Date, fully empowered and authorized under its applicable Operating Agreement
and other applicable rules and regulations, to execute, perform and carry out
this Agreement according to its terms.
J. At the Closing, the Seller shall release, hold harmless and
discharge the Buyer from any and all controversies, claims, suits and actions
whatsoever, in law or in equity, which the Seller or any successor or other
assign of the Seller may have or become a party to by reason of any matter,
cause or thing whatsoever arising before the Closing Date, except as expressly
provided herein and except Buyer's obligations under this Asset Purchase
Agreement.
K. The Seller acknowledges and agrees that the Buyer has not and shall
not assume any of the Seller's liabilities other than as expressly set out
elsewhere in this Asset Purchase Agreement.
L. The representations and warranties of the Seller contained in this
Agreement or in any certificate or document delivered pursuant to the provisions
hereof shall be substantially true and complete at and as of the time of Closing
as though the representations and warranties were made at and as of such time,
and this assurance of the Seller shall be deemed and construed to be continuous
and shall survive both the Closing and payment of the purchase price.
M. The Seller's sale and conveyance of the Assets hereunder does not
comprise disposition of, or cessation of, its commercial operations. The Seller
will continue its operation in business other than physical printing following
Closing of the asset conveyance transaction contemplated in this Asset Purchase
Agreement.
N Seller will execute and deliver at Closing such bills of sale with
covenants of warranty, assignments, endorsement, and other good and sufficient
instruments and documents of conveyance and transfer, in form and substance
satisfactory to the Buyer and its counsel, as shall be necessary and effective
to convey, transfer and assign to, and vest in, the Buyer all of the Seller's
right, title and interest in and to the Assets, including, without limitation,
good, valid and marketable title in and to all of the Assets.
O. Seller will execute and deliver at Closing such other instruments as
Buyer reasonably requests in order to vest in Buyer title in and to the Assets.
P The Seller from time to time after the Closing, at the Buyer's
request, will execute, acknowledge and deliver to the Buyer such other
instruments of conveyance and transfer and will take such other actions and
execute and deliver such other documents, certifications and further assurances
as the Buyer may reasonably request in order to vest more effectively in the
Buyer, or to put the Buyer more fully in possession of, any of the Assets.
Q. The Seller has all requisite power, authority and legal right to
execute, deliver and perform this Agreement. The execution, delivery and
performance of this Agreement by the Seller have been duly authorized by all
necessary company and membership action.
R. All material representations, warranties, covenants and agreements
made by the Seller within this Agreement, or in any certificate, schedule,
statement, document or instrument furnished hereunder or in connection with the
negotiation, execution and performance of this Agreement shall survive the
Closing.
S. To the best of knowledge of the Seller, after a due, proper and
complete investigation, the Seller has complied with each, and is not in
violation of any law, rule or regulation to which it or its business,
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operations, assets or properties is subject, and has not failed to obtain or to
adhere to the requirements of any license, permit or authorization necessary to
the ownership of the Assets or to the conduct of its business, which
noncompliance, violation or failure to obtain or adhere might adversely affect
its business, operations, assets, properties, prospects or condition (financial
or otherwise).
T. To the best of knowledge of the Seller, there are no conditions
existing with respect to the Seller's commercial printing markets, products,
services, personnel or suppliers which are known to the Seller or which should
be known to the prudent businessman in charge of the Seller's operations which
would adversely affect the business, operations or prospects of the Seller
relating to its commercial printing business, other than such conditions as may
affect as the industry as a whole.
ARTICLE IV.
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BUYER'S WARRANTIES AND REPRESENTATIONS
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The Buyer represents and warrants:
A. The execution and delivery of this Agreement and the subsequent
performance and closing of the transaction contemplated hereby shall have been
freely and voluntarily undertaken by the Buyer. The Buyer has and will continue
to have full, unrestricted ability and power to enter into, close and perform
this Agreement and the transactions contemplated hereby. This Agreement
constitutes a valid and binding agreement of the Buyer and of the Personal
Guarantor fully enforceable in accordance with its terms. The Personal
Guarantor, Xxxxxxx X. Xxxxx, is now the Buyer's sole shareholder, director and
officer and will be at Closing.
B. The execution and delivery of this Agreement and the consummation of
the transaction contemplated hereby will not conflict, or be inconsistent with,
or result in the termination of, or result in any breach of, or constitute a
default under the terms of, any indenture, mortgage, deed of trust, covenant,
agreement, or other instrument to which the Buyer or the Personal Guarantor is a
party or to which any of their property is subject.
C. At the Closing, the Buyer shall release, hold harmless and
discharge, the Seller from all controversies, claims, suits and actions
whatsoever, in law or in equity, in which the Buyer or any personal
representative, successor, heir or assign of the Buyer may have or become a
party to by reason of any matter, cause or thing whatsoever arising after the
Closing Date.
D. The representations and warranties of the Buyer contained in this
Agreement or in any certificate or document delivered pursuant to the provisions
hereof shall be true and complete at and as of the time of Closing as though the
representations and warranties were made at and as of such time, and this
assurance of the Buyer shall be deemed and construed to be continuous and shall
survive both the Closing and the payment of the purchase price.
ARTICLE V.
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FOLLOW-ON COMMISSIONS AGREEMENT
-------------------------------
Subsequent to the Closing of the transaction contemplated in this Asset
Purchase Agreement, the Buyer agrees to, and shall, pay the Seller commissions
(hereinafter "Follow-On Commissions") at the rate of ten (10%) percent of its
gross revenues from all of Buyer's sales of products manufactured by the Buyer
for Motorola, Inc., Belize Telecom, Haiti Telecommunications, Guyana Telecom,
Verizon Puerto Rico and Alcatel Mexico, if any. Such Follow-On Commissions shall
be payable for a 24 month period following the Closing Date with the exception
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of products manufactured for Motorola which shall be paid for by the Buyer to
the Seller during the ten (10) year period following the Closing Date, monthly
upon receipt by the Buyer of the corresponding, commissionable gross revenues.
Buyer shall provide the Seller, upon Seller's reasonable request effective
access to its continuing true sales records to enable the Seller to
independently determine Follow-On Commissions due and payable by the Buyer to
the Seller under this Article V.
ARTICLE VI.
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RISK OF LOSS
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A. All risk of loss or damage to any of the Assets to be transferred to
the Buyer hereunder is allocated to the Seller at all times prior to the Closing
Date and to the Buyer at all times subsequent to the Closing. In the event of
such loss or damage prior to Closing, the proceeds of, or any claim for any loss
payable under, any insurance policy coverage with respect thereto shall go to
the Seller, and shall be used to repair, replace or restore such lost or damaged
Assets. At the option of Buyer however, in the Buyer's sole discretion, such
proceeds may be paid to the Buyer by the Seller at Closing in lieu of repair,
replacement or restoration of such lost or damaged Assets by the Seller; in
which case the Seller shall have no further liability to the Buyer with respect
such lost or damaged Assets.
B. In the event such loss or damage prevents operation of the Seller's
business, the Seller shall deliver prompt written notice thereof to the Buyer,
if the Seller cannot restore all of its facilities so that normal and usual
operation can be resumed before the Closing Date, the Closing Date shall be
postponed. The exact date and time of such postponed closing shall be designated
by the Seller, within sixty (60) days of the Closing Date, upon five (5) days'
written notice to the Buyer.
ARTICLE VII.
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CONDITIONS TO THE OBLIGATION OF BUYER
-------------------------------------
The obligation of the Buyer to consummate the transaction herein
contemplated is subject to the satisfaction on or before the Closing Date of the
following conditions:
A. The representations and warranties of Seller contained in this
Agreement and in any schedule, exhibit, or other document delivered pursuant to
this Agreement shall be true complete and correct on and as of the Closing Date
with the same effect as though such representations and warranties had been made
and delivered to the Seller on the Closing Date and the Buyer shall have
received the Seller's certificate to such effect.
B. Each obligation or act of the Seller to be performed on or before
the Closing Date pursuant to the terms of this Agreement or as contemplated
herein shall have been duly performed.
C. All consents of third parties required for effective and valid
assignment of the Assets to the Buyer as contemplated herein or required for the
consummation of the transaction contemplated herein, or required in order to
prevent a breach of, a default under, or a termination of any agreement or
understanding to which the Seller is a party shall have been previously obtained
in writing.
D. The Seller shall tender at the Closing all records, documents and
other materials to be delivered by the Seller at the Closing pursuant to the
terms hereof.
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ARTICLE VIII.
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CONDITIONS TO THE OBLIGATION OF SELLER
--------------------------------------
The obligation of the Seller to consummate the transaction contemplated
herein is subject to the satisfaction on or before the Closing Date of the
following conditions:
A. The representations and warranties of the Buyer contained in this
Agreement and in any schedule, exhibit, or other document delivered pursuant
hereto shall be true and correct on and as of the Closing Date with the same
effect as though such representations and warranties had been made on and as of
such date, and the Seller shall have received a certificate to this effect dated
the Closing Date and executed by the Buyer.
B. Each obligation or act of the Buyer to be performed on or before the
Closing Date pursuant to the terms of this Agreement or as contemplated herein
shall have been duly performed, and the Seller shall have received a certificate
to this effect dated the Closing Date and executed by the Buyer.
C. The Buyer shall have delivered to the Seller the closing documents
described in this Agreement.
D. The Buyer shall tender payment of the purchase price as provided in
Article II. of this Agreement. The Buyer understands and specifically
acknowledges that any default whatsoever in payment of the purchase price as set
out in Article II. of this Agreement shall comprise material breach of the
Agreement.
ARTICLE IX.
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INDEMNIFICATION
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A. By Seller. The Seller agrees to defend, indemnify, and hold Buyer
harmless from and against any loss, claim, damage, liability or expense
(including reasonable attorneys' fees) (i) incurred or sustained by the Buyer on
account of any and all liabilities of Seller arising out of or attributable to
the operation of the Seller's business prior to the Closing Date (ii) incurred
or sustained by the Buyer on account of any misrepresentation or breach of any
representation, warranty, covenant, or agreement of the Seller contained in this
Agreement or in any schedule, exhibit, or other document delivered pursuant
hereto, or (iii) incurred or sustained by the Buyer on account of any liability
of the Seller for a finder's fee, brokerage commission, or other like payment.
If any claim is asserted against the Buyer for which indemnification may be
sought under the provisions of this Article IX, the Buyer shall promptly notify
the Seller that the Seller may participate in the negotiation and settlement of
any such claim at the expense of the Seller and permitting the Seller to join in
the defense of any legal action arising therefrom at the their expense.
B. By Buyer. The Buyer agrees to defend, indemnify, and hold the Seller
harmless from and against any loss, claim, damage, liability, or expense
(including reasonable attorney's fees) (i) incurred or sustained by Seller on
account of liabilities and obligations arising out of or attributable to the
ownership and use of the Assets after the Closing Date, or accruing after the
Closing Date under the contracts, lease, or understandings assigned to the Buyer
(ii) incurred or sustained by the Seller on account of any misrepresentation or
breach of any representation, warranty, covenant, or obligation of the Buyer
contained in this Agreement or in any schedule, exhibit, or other document
delivered pursuant hereto, or (iii) incurred or sustained by the Seller on
account of any liability of the Buyer for a finder's fee, brokerage commission,
or other like payment. If any claim is asserted against Seller from which
indemnification may be sough under the provisions of this Article IX, the Seller
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shall promptly notify the Buyer of such claim and thereafter shall permit the
Buyer at the Buyer's expense to participate in the negotiation and settlement of
any such claim and to join in the defense of any legal action arising therefrom.
ARTICLE X.
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EFFECTIVE DATE, CLOSING DATE AND PLACE
--------------------------------------
A. The Closing Date for the Asset Purchase transaction contemplated
herein shall be December 30, 2004. The Effective Date shall be November 11,
2004.
B. Closing shall take place at the law offices of Xxxxxxx & Xxxxxxx,
located at 0000 Xxxx Xxxxxx Xxxx, Xxxxx Xxxxxxx, Xxxxxxx 00000.
ARTICLE XI.
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ADJUSTMENTS TO PURCHASE PRICE
-----------------------------
A visual inventory inspection and valuation shall be made by the Buyer and
the Seller immediately before the Closing to establish the purchase price to be
paid to the Seller by the Buyer for inventory, work in progress and supplies as
described in paragraph A. of Article II. hereof.
ARTICLE XII.
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BROKERS; ATTORNEY'S FEES AND EXPENSES
-------------------------------------
A. Buyer and Seller both represent and warrant that all introductions,
discussions, negotiations and all dealing with respect to the transaction
contemplated herein have been undertaken and conducted directly by the parties
or their representatives, and that no other person, firm or entity has acted in
this proposed transaction in any way, directly or indirectly, so as to give rise
to entitlement or claim to a finder's fee, brokerage fee or other like payment.
B. In connection with document preparation and Closing of the
transaction contemplated in this Asset Purchase Agreement, the parties shall
each pay their respective Attorney's fees and costs.
ARTICLE XIII.
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CLOSING DOCUMENTS
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The parties hereto shall execute such customary closing documents as may
be reasonably necessary for the implementation and consummation of the
transaction contemplated in this Asset Purchase Agreement.
ARTICLE XIV.
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SURVIVAL
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The obligations and acts which are to be performed hereunder after the
Closing Date and the several covenants, representations and warranties and
agreements of the parties herein contained in Articles III. and IV. and most
specifically, the Follow-On Commissions agreement reflected in Article V. and
the non-compete provisions of Article XVII. and the indemnification terms of
Article XIV hereof which shall be in full force and effect for the periods, if
any, specified therein, shall survive the Closing Date.
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ARTICLE XV.
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REMEDIES ON DEFAULT OCCURRING AFTER CLOSING DATE
------------------------------------------------
In the event of a material breach of any term or condition of this
Agreement or any warranty or representation contained herein by either the Buyer
or the Seller arising after the Closing Date, the injured party may pursue all
remedies at equity and at law as it may determine in its sole discretion,
including set-off or specific performance, if applicable. In the event of
litigation, the prevailing party shall be entitled to recover its reasonable
attorney's fees and court costs.
ARTICLE XVII.
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NON-COMPETE
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Following the Closing, the Seller and Principals shall refrain from all
commercial printing activities within the United States of America for a period
of twenty-four (24) months. The term "all commercial printing activities" in the
context of this Agreement does NOT include the following activities or any
activity within the following areas:
1. Secured credit cards with holograms (i.e. Visa, Mastercard,
Discover, Citibank, Diners, American Express)
2. Secured gift cards with holograms (i.e. Visa, Mastercard, Bankcards)
3. Smart Cards with embedded chip technology
4. Radio Frequency Identification Device;(RFID) applications (i.e. slap
and tag facility, tags, labels, RFID plastic cards)
5. Holographic foil cards
6. Lenticular cards
7. Biometric identification cards (i.e. Identification production
process, equipment and accessories)
8. Polypropylene cards
9. Polyethylene raw material film/sheets
10. PVC raw material film/sheets
11. OPP raw material film/sheets
12. High impact polystyrene film/sheets
13. OPP FIN form seal applications (i.e. Packaging pharmaceuticals,
food, CDs, DVDs, Smart cards)
14. Products that are thicker than .030 mil plastic
15. Printing and card finishing equipment or accessories for resale
purposes only
The term "within the United States of America" in the context of this
Agreement shall mean commercial printing activities where the commercial
printing customer and the corresponding printing manufacturing is located within
the United States.
In addition, for a period of ten (10) years following the Closing, the Seller
and Principals agree that notwithstanding any language contained in this
Agreement to the contrary they shall not contact any of the Seller's customers
listed in the attached Exhibit ___ for any reason whatsoever regardless of
whether such customer is located within or outside the United States of
America.. Moreover, for a period of twenty-four (24) months, following the
Closing, the Seller shall give the Buyer a right of first refusal on any
commercial printing orders, within the United States of America that the Seller
is in a position to place with the Buyer. If the Buyer is unable or unwilling,
for any reason to print such a commercial printing order, the Buyer and the
Seller agree to jointly outsource the order for their mutual benefit pursuant to
the terms of the certain Strategic Alliance Agreement by and between them dated
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December 30, 2004. The right of first refusal given does not apply to business
arising from the fifteen (15) activity areas specified hereinabove as all of
those activity areas are outside the scope of the non-competition provisions of
this Article XVII. Further in addition, Seller and Principals agree that for the
same twenty-four (24) month period following the Closing they shall not work
for, advise, consult with, service or assist, either directly or indirectly, any
party operating within the United States of America who is in the business of
commercial printing as defined by this Agreement or purchase or otherwise
acquire any interest in a company engaged in commercial printing within the
United States of America.
ARTICLE XVIII.
--------------
NO ASSIGNMENT
-------------
This Agreement shall not be assignable.
ARTICLE XIX.
------------
ENTIRE AGREEMENT; MODIFICATION
------------------------------
This Agreement and the Strategic Alliance Agreement reflected in Article
XVII. comprise the entire agreement between the parties with respect to the
subject matter hereof. They supersede any prior agreement or understanding
relating to the subject matter and neither may be amended or modified except by
an instrument in writing duly executed by all of the parties hereto.
ARTICLE XX.
-----------
HEADINGS
--------
The headings of the Articles of this Agreement for convenience of
reference only and do not alter or affect the terms of this Agreement.
ARTICLE XXI.
------------
GOVERNING LAW
-------------
This Agreement shall be construed and governed in accordance with the laws
of the State of Florida and has been negotiated and is to be performed in the
State of Florida. Venue in any dispute arising hereunder shall be in the Circuit
Court in the Seventeenth Judicial Circuit in and for Broward County, Florida.
ARTICLE XXII.
-------------
NOTICE
------
All notices, demands, requests and correspondence shall be deemed duly
given if mailed by certified mail, postage prepaid, and addressed as follows:
IF TO THE SELLER: Advanced Imaging Systems, LLC
0000 XX 00xx Xxxxxxx
Xxxx Xxxxxxxxxx, XX 00000
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AND TO: Xxxxxx Xxxxxxx Xxxxxxx, Esq.
Xxxxxx Xxxxxxx Xxxxxxx, P.A.
000 Xxxxxxxxx Xxxxx Xxxxxx
Xxxx Xxxxxxxxxx, XX 00000
IF TO THE BUYER: RBE & SJC, Inc.
0000 XX 00xx Xxxxx
Xxxxxxxxxx, XX 00000
AND TO: Xxxxxxx X. Xxxxxxx, Esq.
Xxxxxxx & Xxxxxxx
0000 Xxxx Xxxxxx Xxxx
Xxxxx Xxxxxxx, XX 00000
ARTICLE XXIII.
--------------
COUNTERPARTS
------------
This Agreement may be executed upon any number of identical counterparts
with the same effect as if the signature or signatures to each counterpart were
upon the same physical instruments.
WHEREFORE, the parties have hereunto set their hands and seals as of the
date first above
SELLER: Advanced Imaging Systems, LLC,
a Delaware Limited Liability Company
BY: /s/ C. XXX XXXXX
-------------------------------
C. Xxx Xxxxx, the Manager
(SEAL)
Attest
BY: /s/ XXXXX XXXXXX
-------------------------------
Xxxxx Xxxxxx, Secretary
BUYER: RBE & SJC, Inc., Florida corporation
BY: /s/ XXXXXXX X. XXXXX
-------------------------------
Xxxxxxx X. Xxxxx, President
(SEAL)
Attest:
BY: /s/ XXXXXXX X. XXXXX
-------------------------------
Xxxxxxx X. Xxxxx, Secretary
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