Exhibit 10.3
ASSET PURCHASE AGREEMENT
between
BLUE WATER MEDICAL SUPPLY, INC.
and
BLUE WATER INDUSTRIAL PRODUCTS, INC.
(collectively, "Seller")
and
LIFE CRITICAL CARE CORPORATION
("Purchaser")
January 22, 1996
TABLE OF CONTENTS
Page
RECITALS........................................................... 1
ARTICLE 1. PURCHASE AND SALE OF ASSETS............................ 1
SECTION 1.1 Closing Date.................................... 1
SECTION 1.2 Purchase and Sale of Assets..................... 1
SECTION 1.3 Excluded Assets................................. 2
SECTION 1.4 Purchase Price.................................. 2
SECTION 1.5 Payment of Purchase Price....................... 2
SECTION 1.6 Liabilities Assumed............................. 6
SECTION 1.7 Allocation of Purchase Price.................... 7
SECTION 1.8 Change and Use of Name.......................... 7
SECTION 1.9 Accounts Receivable............................. 7
ARTICLE 2. REPRESENTATIONS AND WARRANTIES OF SELLER............... 7
SECTION 2.1 Organization and Qualification, Etc............. 7
SECTION 2.2 Authority Relative to Agreement................. 8
SECTION 2.3 No Breach; Consents............................. 8
SECTION 2.4 No Material Adverse Change...................... 8
SECTION 2.5 Title to Purchased Assets....................... 8
SECTION 2.6 Tax Matters..................................... 9
SECTION 2.7 Contracts and Commitments....................... 9
SECTION 2.8 Litigation, Etc................................. 11
SECTION 2.9 Brokerage....................................... 11
SECTION 2.10 Insurance....................................... 11
SECTION 2.11 Compliance with Laws............................ 11
SECTION 2.12 Employees....................................... 11
SECTION 2.13 Licenses and Permits............................ 11
SECTION 2.14 Business Records................................ 12
SECTION 2.15. Environmental Matters........................... 12
SECTION 2.16. Financial Statements............................ 12
SECTION 2.17. Material Misstatements or Omissions............. 12
SECTION 2.18. Effective Date of Warranties, Representations
and Covenants.............................. 13
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ARTICLE 3. REPRESENTATIONS AND WARRANTIES OF PURCHASER............ 13
SECTION 3.1 Organization, Etc............................... 13
SECTION 3.2 Authority Relative to Agreement ................ 13
SECTION 3.3 No Breach; Consents............................. 13
SECTION 3.4 Litigation...................................... 14
SECTION 3.5 Compliance...................................... 14
SECTION 3.6 Brokerage....................................... 14
ARTICLE 4. CLOSING CONDITIONS..................................... 14
SECTION 4.1 Closing Conditions Relating to Purchaser........ 14
SECTION 4.2 Closing Conditions Relating to Seller........... 16
ARTICLE 5. PRE-CLOSING AGREEMENTS................................. 17
SECTION 5.1 Due Diligence................................... 17
SECTION 5.2 Operation of Business........................... 17
SECTION 5.3 Best Efforts.................................... 17
SECTION 5.4 Confidentiality................................. 17
SECTION 5.5 Public Announcements............................ 18
ARTICLE 6. POST-CLOSING AGREEMENTS................................ 18
SECTION 6.1 Indemnification by Seller ...................... 18
SECTION 6.2 Further Assurances.............................. 20
SECTION 6.3 Books and Records............................... 20
SECTION 6.4 Employees ...................................... 21
ARTICLE 7. MISCELLANEOUS.......................................... 21
SECTION 7.1 Survival ....................................... 21
SECTION 7.2 Termination .................................... 21
SECTION 7.3 Expenses ....................................... 22
SECTION 7.4 Amendments, Waivers and Remedies................ 22
SECTION 7.5 Notices ........................................ 23
SECTION 7.6 Assignment ..................................... 24
SECTION 7.7 Severability ................................... 24
SECTION 7.8 Complete Agreement ............................. 24
SECTION 7.9 No Third-Party Beneficiaries ................... 24
SECTION 7.10 Waiver of Bulk Sales Act ....................... 24
SECTION 7.11 Singular and Plural; Gender .................... 24
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SECTION 7.12 Governing Law .................................. 24
SECTION 7.13 Counterparts ................................... 24
SECTION 7.14 Schedules....................................... 25
SECTION 7.15 Headings........................................ 25
SECTION 7.16 Further Documents............................... 25
SECTION 7.17 Arbitration..................................... 25
SECTION 7.18 Counsel......................................... 26
SECTION 7.19 No Offer........................................ 26
EXHIBITS AND SCHEDULES
Exhibit 1.2.......Xxxx of Sale and Assignment of Assets/Medical Supply
Exhibit 1.2.A.....Xxxx of Sale and Assignment of Assets/Industrial Products
Schedule 1.3......Excluded Assets
Schedule 1.6......Liabilities Assumed
Schedule 1.7......Allocation of Purchase Price/Medical Supply
Schedule 1.7.A....Allocation of Purchase Price/Industrial Products
Schedule 2.5.1....Liens
Schedule 2.7......Contracts and Commitments
Schedule 2.8 .....Litigation
Schedule 2.10.....Insurance
Schedule 2.13.....Licenses and Permits
Exhibit 4.1.1.2...Leases
Exhibit 4.1.1.3...Covenant Not to Compete
Exhibit 4.1.1.6...Opinion of Counsel for Seller
Exhibit 4.1.1.7...Articles of Transfer
Exhibit 4.2.1.2...Assignment and Assumption Agreement/Medical Supply
Exhibit 4.2.1.2.A.Assignment and Assumption Agreement/Industrial Products
Exhibit 4.2.1.4...Opinion of Counsel for Purchaser
Exhibit 6.2.......Indemnification Agreement
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ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this "Agreement") is made and entered
into this 22nd day of January, 1996, by and between BLUE WATER MEDICAL SUPPLY,
INC., a Michigan corporation ("Medical Supply"), and BLUE WATER INDUSTRIAL
PRODUCTS, INC., a Michigan corporation ("Industrial Products") (Medical Supply
and Industrial Products are collectively referred to herein as "Seller"); and
LIFE CRITICAL CARE CORPORATION, a Delaware corporation ("Purchaser").
W I T N E S S E T H
WHEREAS, Seller is engaged in the businesses of providing home medical
equipment at facilities located at 00000 Xxxxx Xxxxxx, Xxx Xxxxxxxxx, Xxxxxxxx
00000, and of supplying industrial products at facilities located at 00000 Xxxxx
Xxxxxx, Xxx Xxxxxxxxx, Xxxxxxxx 00000 (collectively, the "Business"); and
WHEREAS, Purchaser desires to purchase, and Seller desires to sell,
substantially all of the assets and properties of Seller, including the goodwill
and all assets used in or necessary for the operation of the Business, on the
terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises, and of the promises,
agreements, representations and warranties hereinafter set forth, Seller and
Purchaser hereby agree as follows:
ARTICLE 1
PURCHASE AND SALE OF ASSETS
SECTION 1.1. Closing Date. Subject to the terms and conditions hereof,
the consummation of the transactions described herein (the "Closing") will take
place at 10:00 a.m., within five (5) business days after the initial public
offering by Purchaser as described in Section 4.1.0 hereof, but in no event
later than April 30, 1996, at the offices of Sullivan, Ward, Bone, Tyler &
Xxxxx, P.C., 1000 Maccabees Center, 00000 Xxxxxxxxxxxx Xxxxxxx, Xxxxxxxxxx,
Xxxxxxxx 00000-0000, or at such other location as Purchaser may reasonably
determine, or at such other time and date as the parties mutually may determine
(the "Closing Date").
SECTION 1.2. Purchase and Sale of Assets. Subject to Section 1.3, at
the Closing, Seller (as used herein, Seller refers to each of the corporations
comprising Seller, as applicable, and Seller refers to each of such
corporations, jointly and severally, as applicable) will sell, convey, transfer
and deliver to Purchaser, and Purchaser will
purchase and receive from Seller, all of the assets, rights, and tangible and
intangible property of Seller owned by Seller and used in the Business on the
Closing Date (all of the assets described in this Section 1.2 are
collectively referred to as the "Purchased Assets"). Subject to Section 1.3,
the Purchased Assets shall include all property and assets owned by Seller
and used in the Business, of every kind and description, wherever located,
including all property, tangible or intangible, real, personal or mixed,
inventory, accounts receivable, equipment, improvements, fixtures,
deposits on contractual obligations or otherwise, Seller's right to use
the names "Blue Water Medical Supply" and "Blue Water Industrial Products",
any derivatives or combinations thereof, and all books and records of Seller
relating to the Business, including without limitation trade secret rights in
any information, computer hardware and software, and all trade titles,
marketing materials and direct mail systems developed to promote the
Business, and all customer lists (past, present and prospective), all as the
same shall exist on the Closing Date, including, without limitation, the assets
and property listed or described in the Bills of Sale and Assignments of Assets
(the "Bills of Sale") attached hereto as Exhibit 1.2. and Exhibit 1.2.A.
SECTION 1.3. Excluded Assets. The Purchased Assets shall not
include those assets of Seller, if any, listed or described on Schedule 1.3
attached hereto.
SECTION 1.4. Purchase Price. Subject to the provisions and adjustments
set forth in Section 1.5 hereof, the purchase price (the "Purchase Price") for
the Purchased Assets, and for the benefits and rights conferred upon Purchaser
hereunder, shall be (i) for the Purchased Assets of Medical Supply, an amount
equal to five million five hundred thousand dollars ($5,500,000) and (ii) for
the Purchased Assets of Industrial Products, an amount equal to four (4) times
the Adjusted EBITDA (as defined in Section 1.5(iv) hereof, with "Industrial
Products" replacing "Medical Supply" as such latter term is used in such
definition) of Industrial Products for the twelve-month period ending November
30, 1995.
SECTION 1.5. Payment of Purchase Price. Purchaser shall pay to
Medical Supply, on its own behalf and as agent for Industrial Products, an
amount equal to Seller's Estimate (as defined in this Section 1.5.) as
follows:
i) Fifty Thousand Dollars ($50,000) (the "Deposit")
shall be paid within ten (10) days following the
receipt by Purchaser of the Statements referred
to in Section 2.16 hereof provided that Seller has
furnished all information reasonably requested by
Purchaser on a timely basis and has cooperated
fully with Purchaser to move towards Closing. The
Deposit shall be deposited into a trust account
with Seller's counsel, Sullivan, Ward, Bone,
Tyler & Xxxxx, P.C. The Deposit shall be
credited to the Purchase Price at Closing or
returned to Purchaser if this Agreement is
terminated pursuant to any of Section 7.2.1.,
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7.2.2., 7.2.3. or 7.2.4. or paid over to Seller if
the Agreement is terminated by Seller solely as a
result of Section 7.2.5 hereof;
ii) The balance of the Seller's Estimate shall be paid
in cash or certified check or wire transfer at the
Seller's option at Closing;
iii) The Purchase Price for the Purchased Assets of
Medical Supply is conditioned upon the book value of
the Purchased Assets of Medical Supply (as
determined by Ernst & Young, LLP using industry
standards applicable to Medical Supply) being at
least equal to nine hundred thirty thousand
dollars ($930,000) as of the Closing Date and in
the event the book value of the Purchased Assets
on Medical Supply's books is less than $930,000 on
the Closing Date then either (a) the Purchase
Price for the Purchased Assets of Medical Supply
shall be adjusted downward by four dollars ($4.00)
for each dollar ($1.00) of the amount of shortfall,
if any, between $930,000 and the actual book value
of the Purchased Assets of Medical Supply on the
Closing Date or (b) Purchaser may elect to terminate
this Agreement;
iv) The Purchase Price for the Purchased Assets of
Medical Supply is further conditioned upon Medical
Supply's earnings before interest, taxes,
depreciation, amortization, profit sharing plan
contribution, compensation to employees who will
not be retained by Purchaser, rental expense over
and above that which would be charged to Purchaser by
Medical Supply's landlords pursuant to the Lease
Agreement included as Schedule 4.1.1.2 hereto,
excess officers' compensation and benefits not
required by replacement personnel, and adjustments
relating to items for periods prior to December 1,
1994, which existed as of Xxxxxxxx 00, 0000
("Xxxxxxxx XXXXXX") for the twelve-month period
ending November 30, 1995 being at least equal to
one million dollars ($1,000,000) and in the event
Medical Supply's Adjusted EBITDA for the
twelve-month period ending November 30, 1995 is
less than $1,000,000 then the Purchase Price for
the Purchased Assets of Medical Supply shall be
further adjusted downward by four dollars ($4.00)
for each dollar ($1.00) of the amount of shortfall,
if any, between $1,000,000 and the actual Adjusted
EBITDA of Medical Supply for the twelve-month
period ending November 30, 1995;
v) The Purchase Price shall be decreased by the
amount, if any, of any debt of the Seller assumed
by Purchaser at Closing and set forth in Schedule 1.6
of this Agreement;
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vi) Seller's Estimate of Purchase Price. No later
than fifteen (15) days prior to the Closing Date,
Seller shall provide Purchaser with an estimate (as
of the Closing Date) of the Purchase Price, as
adjusted pursuant to all of the provisions of
Section 1.4 and this Section 1.5, excluding the
Prorations (as such term is defined in Section
1.5(viii) hereof) ("Seller's Estimate"). Seller's
Estimate shall be accompanied by the certificate of
Seller's chief financial officer stating that
Seller's Estimate has been prepared in good faith
in accordance with the terms of this Agreement,
and by such accounting records, workpapers, and
other back-up material as shall be sufficient to
enable Purchaser to review and verify the
computation of Seller's Estimate. In addition to
Seller's Estimate, Seller shall, no later than
fifteen (15) days prior to the Closing Date, also
provide Purchaser with an estimate (as of the
Closing Date) of the Prorations, which shall be
paid by way of adjustment to the Purchase Price
(it being the intent hereof that the Purchase Price
shall consist of the purchase prices for the assets
of Medical Supply and Industrial Products, as
determined hereunder, as well as the net income
of Medical Supply and Industrial Products, as
determined hereunder as part of the Prorations,
and including income and expense adjustments
including for prepared items as of the Closing
Date). In addition, the parties shall, in mutual
good faith, use their respective best efforts
to further adjust, as necessary, the Purchase
Price at Closing from the Seller's Estimate;
vii) Post-Closing Adjustments. If, at any time during
the one hundred and eighty (180) day period
following the Closing Date, Purchaser or Seller,
respectively, believes that it is entitled to
receive a refund of any portion of the funds paid
at Closing because Seller's Estimate overestimated
any portion of the Purchase Price hereunder or Seller
believes that it is entitled to receive an additional
amount over and above the funds paid at Closing
because Seller's Estimate underestimated any
portion of the Purchase Price hereunder, as
applicable, Purchaser or Seller, as applicable,
shall submit a statement to Seller or Purchaser, as
applicable, that describes the proposed adjustment
to Seller's Estimate and the basis therefor in
reasonable detail. Seller or Purchaser, as
applicable, shall have the right to have its own
accountants review the proposed adjustment and all
underlying books and records. In the event Seller
or Purchaser,
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as applicable, does not disapprove the proposed
adjustment within ten (10) business days after
receipt thereof, the matter shall be deemed to be
conclusively determined as submitted by Purchaser or
Seller, as applicable. In the event Seller or
Purchaser, as applicable, disapproves the proposed
adjustment in a writing delivered to and received
by Purchaser or Seller, as applicable, within ten
(10) days after receipt thereof, the matter shall
be referred to an independent certified public
accountant or public accounting firm (the "Auditor"),
selected mutually reasonably by Purchaser and
Seller, whose determination of the matter shall be
final and binding on the parties. Seller and
Purchaser shall cooperate fully with the Auditor
and shall use their respective best efforts in good
faith to enable the Auditor to resolve any dispute
within thirty (30) days after submission of the
matter to the Auditor. The fees and expenses of the
Auditor shall be paid solely by Purchaser; provided,
however, that in the event an aggregate adjustment
is made in favor of Purchaser by the Auditor in an
amount equal to at least $25,000, then the fees and
expenses of the Auditor shall be paid solely by
Seller. Any refund of any funds paid to Seller at
Closing and/or any payment due to Seller by
Purchaser as a result of any adjustment, as
applicable, shall be due and payable in full within
fifteen (15) days after the amount of such refund
and/or payment has been determined as set forth
herein;
viii) Apportionment of Income and Expense. Seller
shall be entitled to all income attributable
to, and shall be responsible for all expenses
arising out of, the Business (including both
Medical Supply and Industrial Products) for the
period ---- beginning on December 1, 1995 and
ending at 11:59 p.m. on the Closing Date and
Purchaser shall be entitled to all income
attributable to, and shall be responsible for all
expenses arising out of, the Business after 11:59
p.m. on the Closing Date (collectively, the
"Prorations"). All overlapping items of income and
expense shall be prorated or reimbursed, as the
case may be, as of 11:59 p.m. on the Closing Date
including the following: prepaid expenses;
liabilities customarily accrued; taxes and utility
charges; deposits and unearned prepayments
received by Seller in connection with any contract,
lease or other agreement assumed by Purchaser; and
all other items normally prorated in the sale of the
assets of a business;
ix) General Determination and Payment. Prorations shall
be made, insofar as feasible, at Closing and shall
be paid by way of adjustment to the Purchase
Price. As to Prorations that cannot be made at
Closing, Purchaser shall, within one hundred
twenty (120) days after the Closing Date,
determine all such Prorations and deliver a
statement of its determinations to Seller,
which statement shall set forth in reasonable
detail the basis for such determinations. Within
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ten (10) days thereafter, Purchaser shall pay to
Seller or Seller shall pay to Purchaser, as the
case may be, the net amount due. If Seller does not
concur with Purchaser's determinations, the
provisions of Section 1.5(vii) hereof shall apply
with "Prorations" to be used in place of "Seller's
Estimate" as to the interpretation and application
of such Section 1.5(vii) hereof; and
x) Rental Income. It is contemplated that it will be
necessary for Medical Supply to purchase certain
equipment in order for it to maintain new business
from and after December 1, 1995. This equipment will
include but may not be limited to Apnea Monitors,
Ventilators, and O-2 Concentrators (hereafter
referred to as "Equipment"). The Equipment will be
used in the ordinary course of the business of
Medical Supply and will be producing certain
additional revenue from and after December 1, 1995
(hereafter referred to as "Rental Income").
In the event that Medical Supply acquires Equipment
after December 1, 1995, the Purchaser hereby agrees
to reimburse Medical Supply for the purchase of the
Equipment. Purchaser shall reimburse Medical Supply
that amount which equals the difference between the
purchase price and the Rental Income paid as of the
Closing Date.
For example:
Purchase Price of Equipment: $1,500.00
Purchase Date: December 1
Closing Date: February 1
Rental Income: $300.00 x 2 mos. = $600.00
Purchaser would reimburse Medical Supply at the
Closing Date $900.00 for that individual piece
of equipment.
SECTION 1.6. Liabilities Assumed. Purchaser shall assume all
liabilities relating to the Purchased Assets and the operation of the Business
arising after the Closing Date and shall hold Seller harmless from, and
indemnify Seller against, any liabilities relating to the Purchased Assets and
the operation of the Business arising after the Closing Date. Purchaser shall
assume no debts, obligations, contracts, leases or liabilities of Seller, except
as expressly set forth in Schedule 1.6 of this Agreement, and Seller shall hold
Purchaser harmless from, and indemnify Purchaser against, any debt, obligation,
contract, lease or liability not expressly assumed by Purchaser hereunder.
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SECTION 1.7. Allocation of Purchase Price. After due
negotiation, the parties agree that the consideration described in
Section 1.4 shall be allocated among the Purchased Assets in the manner set
forth in Schedule 1.7. as to Medical Supply and Schedule 1.7.A. as to Industrial
Products.
SECTION 1.8. Change and Use of Name. Concurrently with the Closing,
Seller shall take all actions required to enable Purchaser to use the names Blue
Water Medical Supply and Blue Water Industrial Products and any derivatives or
combinations thereof that it may elect, including assisting Purchaser in
Purchaser's filing of assumed name certificates, and Seller shall make no
further use of such names.
SECTION 1.9. Accounts Receivable. A list of Accounts Receivable (i.e.,
any right to payment for goods sold or leased or for services rendered whether
or not they have been earned by performance) of Seller which shall include the
names and addresses of the customer from whom the Account Receivable is owing
and the age and respective amount of each such Account Receivable shall be
provided by Seller to Purchaser at Closing (the "Accounts Receivable List") and
such Accounts Receivable shall be assigned by Seller to Purchaser at Closing as
part of the Purchased Assets.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF
SELLER
As a material inducement to Purchaser to enter into and perform its
obligations under this Agreement, Seller jointly and severally hereby represents
and warrants to Purchaser as follows:
SECTION 2.1. Organization and Qualification, Etc. Each Seller is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Michigan, and has the corporate power to own, lease or
operate all of its properties and assets and to carry on the Business as and
where it is now being conducted. Copies of each of Seller's Articles of
Incorporation and By-Laws, previously delivered to Purchaser and certified by
the Secretary of each Seller, are true, correct and complete copies of such
documents and will not be amended prior to the Closing Date without the prior
written consent of Purchaser.
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SECTION 2.2. Authority Relative to Agreement. Each Seller has the
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement by each Seller and the consummation of the transactions
contemplated on its part have been authorized by its Board of Directors and
stockholders. No other corporate proceedings on the part of either Seller are
necessary to authorize the execution and delivery of this Agreement by it or the
consummation by it of the transactions contemplated on its part hereby. This
Agreement has been duly executed and delivered by each Seller and is a valid and
binding agreement of each Seller, enforceable in accordance with its terms,
except as the enforceability may be affected by bankruptcy, insolvency,
reorganization or other similar laws presently or hereafter in effect affecting
the enforcement of creditors' rights generally.
SECTION 2.3. No Breach; Consents. The negotiation, execution, delivery
and performance of this Agreement by Seller, and the consummation of the
transactions contemplated hereby, (a) do not and will not conflict with or
result in any breach of any of the provisions of, constitute a default under,
result in a violation of, result in the creation of any lien, security interest,
charge, encumbrance or other restriction upon the Purchased Assets under, or
require any authorization, consent, approval, exemption or other action by or
notice to any third party, under the provisions of the Charter or By-Laws of
either Seller or any license, permit, contract, franchise, indenture, mortgage,
lease, loan agreement or other agreement (oral or written) or instrument to
which either Seller is a party or under which its properties are bound, and (b)
do not require any authorization, consent, approval, exemption or other action
by or notice to any court or governmental body under any law, statute, rule,
regulation or decree to which either Seller is subject.
SECTION 2.4. No Material Adverse Change. Since June 30, 1995, there has
been no material adverse change in the financial condition, properties, assets,
business or prospects of Seller, including the Purchased Assets.
SECTION 2.5. Title to Purchased Assets.
2.5.1. Seller owns, or will at Closing own, good and
marketable title, free and clear of all liens and encumbrances, to all of the
Purchased Assets, except as set forth in Schedule 2.5.1, which Purchased Assets
include substantially all of the tangible and intangible personal property owned
by Seller and used or usable in connection with the Business, and on the Closing
Date and upon conveyance, assignment and delivery to Purchaser as provided
herein, Purchaser shall have (subject to compliance with applicable
registration, filing and recording requirements) good and marketable title, or
valid, binding and enforceable rights as contracting party or licensee, as the
case may be, to all the assets purchased by Purchaser hereunder.
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2.5.2. To the best of its knowledge, Seller is not in
violation of any applicable zoning ordinance or other law, regulation or
requirement relating to the operation of owned or leased properties and Seller
has not received any notice of any such violations within the three years prior
to the date hereof.
2.5.3. Seller leases, licenses or owns all of the properties
and assets used in the Business.
SECTION 2.6. Tax Matters. All tax returns and related information
required to be filed by or on behalf of Seller prior to the date hereof have
been prepared and filed in accordance with applicable law, and all taxes,
interest, penalties, assessments or deficiencies that have become due pursuant
to such returns or any assessments or otherwise have been paid in full. All such
returns are true and correct in all material respects. To the best of Seller's
knowledge, there is no unresolved claim concerning Seller's federal, state and
local tax liabilities.
SECTION 2.7. Contracts and Commitments.
2.7.1. Attached hereto as Schedule 2.7 is a separate
schedule containing an accurate and complete list of:
(i) any contract, agreement, purchase order or other
commitment for the purchase or sale by Seller of goods, property or
services together with all amendments, waivers or other changes
thereto.;
(ii) any pension, profit sharing, stock option, employee stock
purchase or other plan providing for deferred compensation or other
employee benefit plan, or any contract with any labor union;
(iii) any agreement or indenture relating to the borrowing of
money or to the mortgaging, pledging or otherwise placing a lien on any
material asset or material group of assets of Seller;
(iv) any lease or agreement under which it is lessee of or
holds or operates any property, real or personal, owned by any other
party, except for any lease of personal property under which the
aggregate annual rental payments do not exceed $1,000;
(v) any lease or agreement under which it is lessor of
or permits any third party to hold or operate any property, real or
personal, owned or controlled by it;
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(vi) all agreements providing for the services of an
independent contractor to which Seller is a party or by which it is
bound;
(vii) as of a date no earlier than November 30, 1995 all of
Seller's Accounts Receivables as previously referred to in Section 1.9
together with detailed information as to each such listed receivable
which has been outstanding more than thirty (30) days;
(viii) any and all other or additional contracts, commitments,
agreements, arrangements, writings, guarantees, leases and licenses to
which Seller is a party or by which Seller or any of its property is
bound.
Each of the contracts, agreements, leases, licenses and commitments
required to be listed on Schedule 2.7 (the "Contracts") is valid and binding,
enforceable in accordance with its respective terms, in full force and effect
and, except as otherwise specified in Schedule 2.7, validly assignable to
Purchaser without the consent, approval or act of, or the making of any filing
with, any other person so that, after the assignment thereof to Purchaser
pursuant hereto, Purchaser will be entitled to the full benefits thereof. True
and complete copies of all of the Contracts (together with any and all
amendments thereto) have been delivered to Purchaser and initialed by Seller's
Secretary and identified with a reference to this Section of this Agreement. To
the best of its knowledge, Seller has performed all obligations required to be
performed by it and is not in default under or in breach of or in receipt of any
claim of default or breach under any of the Contracts and no event has occurred
which with the passage of time or the giving of notice or both would result in a
default, breach or event of noncompliance under any such Contract; Seller has no
knowledge of any breach or anticipated breach by the other parties to any such
Contract; and, to the best of its knowledge, Seller is not a party to any
Contract for the purchase of goods or services at a rate currently above market
prices.
2.7.2. (i) Seller has performed in all material respects all
obligations required to be performed by it and is not in default under or in
breach of nor in receipt of any claim of default or breach under any agreement
referred to in Section 2.7.1, (ii) no event has occurred which with the passage
of time or the giving of notice or both would result in a default, breach or
event of noncompliance under any such agreement, and (iii) Seller does not have
any knowledge of any breach or anticipated breach by any other party to such
agreements.
2.7.3 Purchaser has been heretofore supplied with a true and
correct copy of each of the written contracts which are referred to in Section
2.7.1, together with all amendments, waivers or other changes thereto.
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SECTION 2.8. Litigation, Etc. Other than as set forth in Exhibit 2.8,
there are no actions, suits, proceedings, orders, investigations or claims
pending or, to the best of Seller's knowledge, threatened, against Seller, or to
which Seller is a party, at law or in equity, or before or before or by any
court, tribunal, governmental department, commission, board, bureau, agency or
instrumentality, or any arbitration proceedings pending under collective
bargaining agreements or otherwise. To the knowledge of Seller, there is no
proposed law, rule, regulation, ordinance, order, judgment, decree or award that
would be applicable to Seller that would reasonably be expected to have a
material adverse effect on the condition (financial or otherwise), of the
business, assets, liabilities, capitalization, financial position, results of
operations or prospects of Seller.
SECTION 2.9. Brokerage. There are no claims for brokerage commissions,
finders' fees or similar compensation in connection with the transactions
contemplated by this Agreement based on any arrangement or agreement (oral or
written) binding upon Seller or any stockholder of Seller. Purchaser hereby
acknowledges that Seller shall have no obligation for brokerage commissions,
finders' fees or similar compensation in connection with Xxxx Xxxxxxx'x
introduction of the Seller to the Purchaser and that any amounts due to Xxxx
Xxxxxxx shall be the sole responsibility of Purchaser unless Seller shall have,
in writing, incurred any such obligation on its own behalf in which event Seller
shall be solely responsible for its obligations thereunder.
SECTION 2.10. Insurance. Schedule 2.10 contains an abstract or summary
of each outstanding insurance policy maintained by Seller. Seller has given to
Purchaser a copy of each such insurance policy maintained with respect to
Seller's properties, assets and the Business, and each such policy is in full
force and effect. Purchaser may assume such policies, at its election, at
Closing.
SECTION 2.11. Compliance with Laws. To its best knowledge, Seller has
complied with all laws, rules, regulations, ordinances, orders, judgments, and
decrees applicable to its business or properties, and is not in violation of any
law or any regulation or requirement which might have a material adverse effect
upon its financial condition, operating results or business prospects, and
Seller has not received notice of any such violation.
SECTION 2.12. Employees. To the best knowledge, information and belief
of Seller, Seller has complied with all laws relating to the employment of
labor, including provisions thereof relating to wages, hours, equal opportunity,
collective bargaining and the payment of social security and other taxes.
SECTION 2.13. Licenses and Permits. All permits, licenses and
franchises held by Seller, or by its officers, employees or agents, with respect
to the Business are listed on Schedule 2.13. Except as set forth on Schedule
2.13, such licenses, permits and franchises are freely transferable by Seller.
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SECTION 2.14. Business Records. Seller's personnel files, accounting
records, financial statements, operating statements and customer correspondence
files shall be made available to Purchaser promptly upon the execution of this
Agreement and are complete and correct in all material respects, and accurately
reflect Seller's business operations for a period of not less than three (3)
years.
SECTION 2.15. Environmental Matters. To the best of Seller's knowledge,
there is no condition, circumstance, or set of facts (including without
limitation the presence, either past or present, of any underground storage
tanks) that constitutes a significant hazard to health, safety, property, or the
environment relating to the Business or any real property owned or leased by
Seller for which the Business, Seller or the owner or operator of such real
property would be responsible.
SECTION 2.16. Financial Statements. Seller's financial statements and
notes thereto as at and for the fiscal years ended December 31, 1992, 1993 and
1994 and the ten month period ended October 31, 1995, consisting of balance
sheets and statements of income, changes in cash flow and changes in
stockholders' equity, are to be audited by the certified public accounting firm
of Ernst & Young LLP, independent certified public accountants, on or before
February 15, 1995. All such financial statements, copies of which will, upon
completion, be attached hereto as Exhibit 2.16 the "Statements"), will fairly
present the financial condition and results of the operations of Seller as at
the date indicated and for the period indicated, will have been prepared in
accordance with generally accepted accounting principles consistently applied,
will be in accordance with industry standards applicable to Seller, and will be
in accordance with the books and records of Seller, complete and correct in all
material respects. Time is of the essence in completing the audit and both
Seller and Purchaser agree to cooperate fully to expedite the audit process.
Seller shall provide Purchaser with Seller's internally-generated monthly
financial statements for the periods following June 30, 1995, as they become
available. Purchaser shall pay the auditors for the preparation of the
Statements provided that Seller pays its accountants to prepare the books and
records for audit.
SECTION 2.17. Material Misstatements or Omissions. Seller has not
knowingly made any material misstatements of fact or omitted to state any
material fact necessary or desirable to make complete, accurate, and not
misleading every representation, warranty, schedule, and agreement set forth,
described or referred to herein. Seller has disclosed to Purchaser all material
adverse facts relating to the condition or operation, whether past, present or
future, financial or otherwise, of the Purchased Assets and of the Business, and
shall disclose promptly to Purchaser, in writing, any material adverse facts
arising after the date hereof and prior to Closing.
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SECTION 2.18. Effective Date of Warranties, Representations and
Covenants. Each warranty, representation, and covenant set forth in this Article
2 shall be deemed to be made on and as of the date hereof and as of the Closing
Date (except as otherwise specifically provided herein). Prior to the Closing
Date, Seller will notify Purchaser of any change since the date hereof in any
fact, condition or circumstance of which it becomes aware and which would
require a modification of the foregoing representations and warranties
(including any schedule thereto) to make such representation or warranty (or
schedule thereto) complete, accurate and not misleading in all respects. The
representations and warranties contained in this Article 2 shall not be affected
or deemed waived by reason of the fact that Purchaser and/or its representatives
knew or should have known that any such representation or warranty is or might
be inaccurate in any respect.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
OF PURCHASER
As a material inducement to Seller to enter into and perform its
obligations under this Agreement, Purchaser represents and warrants to Seller as
follows:
SECTION 3.1. Organization, Etc. Purchaser is a corporation duly
incorporated, validly existing and in good standing under the laws of the
State of Delaware.
SECTION 3.2. Authority Relative to Agreement. Purchaser has the
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated on its part hereby. The execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby have been duly authorized by the Board of Directors of Purchaser. No
other corporate proceedings on its part or the part of the stockholders of
Purchaser are necessary to authorize the execution and delivery of this
Agreement by it or the consummation by it of the transactions contemplated on
its part hereby. This Agreement has been duly executed and delivered by
Purchaser and is the valid and binding agreement of Purchaser except as the
enforceability may be affected by bankruptcy, insolvency, reorganization or
other similar laws presently or hereafter in effect affecting the enforcement of
creditors' rights generally.
SECTION 3.3. No Breach; Consents. The execution, delivery and
performance of this Agreement by Purchaser and the consummation of the
transactions contemplated hereby (a) do not and will not conflict with or result
in any breach of any of the provisions of, constitute a default under, result in
a violation of, result in the creation of any lien, security interest, charge or
encumbrance upon the assets of either of Purchaser under, or
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require any authorization, consent, approval, exemption or other action by or
notice to any third party under the provisions of the Charter or By-Laws of
Purchaser or any license, indenture, mortgage, lease, loan agreement or other
agreement (oral or written) or instrument to which Purchaser is a party, and (b)
do not require any authorization, consent, approval, exemption or other action
by or notice to any court or governmental body under any law, statute, rule,
regulation or decree to which Purchaser is subject.
SECTION 3.4. Litigation. There is no claim, action, suit or proceeding
pending or, to the knowledge of Purchaser, threatened against Purchaser or any
of its properties which seeks to prohibit, restrict or delay consummation of the
transactions contemplated hereby or to limit in any manner the right of
Purchaser to control Seller or any material aspect of the Business of Seller
after the Closing Date, and there is no judgment, decree, injunction, ruling or
order of any court, governmental department, commission, agency or
instrumentality or arbitrator outstanding against Purchaser having, or which
Purchaser believes may in the future have, any such effect.
SECTION 3.5. Compliance. Purchaser has complied with all laws, rules,
regulations, ordinances, orders, judgments or decrees necessary to effectuate
this transaction.
SECTION 3.6. Brokerage. Subject to the provisions of Section 2.9.
hereof relating to Xxxx Xxxxxxx, there are no claims for brokerage
commissions, finders' fees or similar compensation in connection with the
transactions contemplated by this Agreement based on any arrangement or
agreement made by or on behalf of Purchaser.
ARTICLE 4
CLOSING CONDITIONS
SECTION 4.1. Closing Conditions Relating to Purchaser. The obligation
of Purchaser to consummate the purchase of the Purchased Assets will be subject
to the satisfaction of the following conditions, any of which may be waived by
Purchaser in its sole and absolute discretion:
4.1.0 Contingencies.
4.1.0.1. Purchaser intends to register
certain of its securities under the Securities Act of 1933, as amended (the
"Securities Act") as part of an initial public offering of its securities (the
"IPO"). Accordingly, Purchaser agrees to use its reasonable best efforts to do
as follows:
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(a) Prepare and file with such
amendments and supplements to the registration statement and the prospectus
used in connection therewith as may be necessary to keep said registration
statement effective and to comply with the provisions of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and the Securities Act,
with respect to the sale of securities covered by said registration statement
for the period necessary to complete the proposed public offering;
(b) Enter into an underwriting
agreement with customary provisions reasonably required by the underwriter,
if any, of the offering; and
(c) Register its securities covered by
said registration statement under the securities or "blue sky" laws of
appropriate jurisdictions.
It shall be a condition precedent to Purchaser's
obligation to close hereunder that the IPO shall have been completed on
terms and conditions reasonably satisfactory to Purchaser.
4.1.1. Deliveries. At or prior to the Closing, Seller
shall deliver, or cause to be delivered to Purchaser, the following items,
fully executed by all appropriate parties and in form and substance acceptable
to Purchaser:
4.1.1.1. Bills of Sale. Bills of Sale in the forms
of Exhibit 1.2 and Exhibit 1.2.A attached hereto together with any and
all other evidences of conveyance reasonably requested by Purchaser to
obtain clear title to the Purchased Assets.
4.1.1.2. Leases. The Leases in the form of
Exhibit 4.1.1.2 attached hereto executed by Seller.
4.1.1.3. Covenants Not to Compete. Covenants Not
to Compete in the form of Exhibit 4.1.1.3 attached hereto executed by each of
the stockholders of Seller.
4.1.1.4. Corporate Resolutions. Seller shall
deliver to Purchaser certified copies of the resolutions of its Board of
Directors and certified copies of the resolutions of its stockholder(s)
authorizing the transactions contemplated herein.
4.1.1.5. Consents. Seller shall deliver to
Purchaser copies of all necessary third party and governmental consents,
in a form satisfactory to Purchaser, that Seller is required to obtain
in order to consummate the transactions contemplated by this Agreement.
4.1.1.6. Opinion of Counsel for Seller. Purchaser
shall receive an opinion dated the Closing Date of Sullivan, Ward, Bone,
Tyler & Xxxxx, P.C., counsel or the Seller, in the form of Exhibit 4.1.1.6
attached hereto.
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4.1.1.7. Articles of Transfer. Articles of
Transfer in the form of Exhibit 4.1.1.7 attached hereto as to each Seller.
4.1.2. Due Diligence Results. Nothing shall have come to
the attention of Purchaser, in the course of its due diligence investigation
pursuant to Section 5.1 or otherwise, which demonstrates that any of the
representations or warranties of Seller is inaccurate or incomplete in any
material manner.
4.1.3. No Injunction. The consummation of the
transactions contemplated hereby shall not have been enjoined by any court of
competent jurisdiction and no proceeding seeking such an injunction shall be
pending.
SECTION 4.2. Closing Conditions Relating to Seller. The obligation
of Seller to consummate the sale of the Purchased Assets will be subject to
the satisfaction of the following conditions:
4.2.1. Deliveries. At or prior to the Closing, Purchaser
shall deliver, or cause to be delivered to Seller, the following items:
4.2.1.1. The Purchase Price.
4.2.1.2. Assignment and Assumption Agreements. Assignment
and Assumption Agreements in the form of Exhibit 4.2.1.2 and Exhibit 4.2.1.2.A
are attached hereto.
4.2.1.3. Leases. The Leases in the form of Exhibit
4.1.1.2 attached hereto executed by Purchaser.
4.2.1.4. Opinion of Counsel for Purchaser. Seller shall
receive an opinion dated the Closing Date of Xxxxxxxxx, Xxxxxx & Preston
L.L.P., counsel for Purchaser, in the form of Exhibit 4.2.1.4 attached hereto.
4.2.1.5. Corporate Resolutions. Purchaser shall deliver
to Seller certified copies of the resolutions of its Board of Directors
authorizing the transactions contemplated herein.
4.2.2. No Injunction. The consummation of the transactions
contemplated hereby shall not be enjoined by any court of competent
jurisdiction and no proceeding seeking such an injunction shall be pending.
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ARTICLE 5
PRE-CLOSING AGREEMENTS
SECTION 5.1. Due Diligence. Seller shall grant to Purchaser, and its
employees, counsel, accountants and other representatives, full and complete
access to Seller, its facilities, management, employees and records and its
outside accountants and counsel for purposes of a due diligence investigation in
connection with the transactions contemplated hereby. Purchaser agrees to
exercise its reasonable best efforts in conducting such due diligence in a
manner that will not significantly interfere with or disrupt the normal
operations of Seller or arouse suspicions of Seller's employees, customers or
suppliers that either the capital stock or the assets of Seller are for sale.
Seller will provide Purchaser and its representatives full access to all
relevant financial information, personnel, service and contractual information.
The cost of any such due diligence shall be borne by Purchaser.
SECTION 5.2. Operation of Business. Seller shall continue to operate
the Business in the ordinary course in such manner that each and every warranty
and representation of Seller made herein as of the date hereof will be true,
complete and accurate in all respects as of the date of the Closing hereunder,
without substantial change, and will maintain or cause to be maintained all
existing insurance coverage on the Purchased Assets of Seller until the Closing.
Until the Closing, all risk of loss, damage, or destruction to the Purchased
Assets shall be upon Seller, and in the event of any material loss, damage, or
destruction to the Purchased Assets, Purchaser shall be entitled to terminate
this Agreement within thirty (30) days of learning of the same. Prior to
Closing, Seller shall not increase any current compensation levels of employees
or pay any bonuses or other direct or indirect compensation without the prior
written consent of Purchaser.
SECTION 5.3. Best Efforts. The parties hereto agree to use their
best efforts to cause all conditions to Closing to be satisfied and to cause
the transactions contemplated hereby to be consummated.
SECTION 5.4. Confidentiality. During the due diligence period described
in Section 5.1. hereof, Purchaser and Seller agree that they, and their
respective officers, directors and other representatives, will hold in strict
confidence the negotiations relating to the transactions contemplated by this
Agreement, and all information exchanged pursuant thereto. If, for any reason,
Closing does not occur, all information exchanged by Purchaser and Seller shall
promptly be returned to the other party and each party agrees that it will not
use any such information in any way detrimental to the other party and that all
such information shall continue to be treated confidentially. The parties hereto
acknowledge and understand that Purchaser shall undertake the IPO described in
Section 4.1.0 hereof and shall be entitled to comply with all applicable
regulatory and disclosure requirements incident to such registration of
securities. In addition, Seller will refrain
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from, and will cause its officers, directors, representatives, agents and
employees to refrain from, directly or indirectly, encouraging, soliciting,
initiating or participating in discussions or negotiations with or providing any
non-public information to any person other than Purchaser concerning the sale
or purchase of the Business (except in the ordinary course of its business),
any merger or consolidation involving Seller or any other transaction in
which Seller's Business would be acquired by a person other than Purchaser.
SECTION 5.5. Public Announcements. Neither Purchaser nor Seller shall
issue any press release or otherwise make any public statement with respect to
this Agreement or the transactions contemplated hereby unless such press release
or public statement is satisfactory to the other party to this Agreement, and
Purchaser and Seller shall consult with each other as to the form and substance
of any public disclosure related thereto; provided, however, that nothing
contained herein shall prohibit any party from making any disclosure which is
required by law.
ARTICLE 6
POST-CLOSING AGREEMENTS
SECTION 6.1. Indemnification by Seller.
6.1.1. Without limitation as to the other rights of Purchaser,
Seller shall indemnify, save and keep Purchaser, its successors and assigns and
its stockholders, directors, officers, affiliates, representatives and employees
and the estates, personal representatives and heirs of such persons, forever
harmless against and from all liability, demands, claims, actions or causes of
action, assessments, losses, penalties costs, damages or expenses, including
reasonable attorneys and expert witness fees (collectively, the "Losses")
sustained or incurred by any of the foregoing persons as a result of or arising
out of or by virtue of (i) any incorrect representation or warranty made by
Seller herein or in any certificate, exhibit or schedule delivered to Purchaser
in connection herewith, or (ii) any debt, liability or obligation of Seller
(whether known or unknown, absolute or contingent) not expressly assumed by
Purchaser hereunder.
6.1.2. Without limitation as to the other rights of Seller,
including without limitation the indemnification provisions of the Assignment
and Assumption Agreements to be executed at Closing in the forms attached hereto
as Exhibit 4.2.1.2 and Exhibit 4.2.1.2.A, Purchaser shall indemnify, save and
keep Seller, its successor and assigns and its stockholders, directors,
officers, affiliates, representatives and employees and the estates, personal
representatives and heirs of such persons forever harmless against and from all
liability, demands, claims, actions, or causes of actions, assessments, losses,
penalties, costs, damages or expenses including reasonable attorneys and expert
witness
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fees (collectively the "Losses") sustained or incurred by any of the
foregoing persons (i) as a result of or arising out of or by virtue of any
incorrect representation or warranty made by Purchaser herein or in any
certificate, exhibit or schedule delivered by Purchaser to Seller, if any, in
connection herewith, or (ii) relating to the Purchased Assets and the operation
of the Business arising after the Closing Date.
6.1.3. A party required under this Section 6.1 to furnish
indemnity (the "Indemnifying Party") shall satisfy its obligation of
indemnification under this Section 6.1 within forty-five (45) days after written
notice thereof from any party entitled to such indemnity hereunder (the
"Indemnified Party") to the Indemnifying Party; provided, however, that a party
shall not be deemed in breach hereof for so long as it contests in good faith
its liability for indemnification hereunder.
6.1.4. As soon as practicable after obtaining knowledge
thereof, any Indemnified Party shall notify the Indemnifying Party of any claim
or demand which the Indemnified Party has determined has given or could give
rise to a right of indemnification under this Agreement. A failure to give such
notice shall not negate a right to indemnification hereunder; provided, however,
that the Indemnified Party shall bear any amount of Loss resulting directly from
a failure to give a timely notice. If such claim or demand relates to a claim or
demand asserted by a third party against the Indemnified Party and if the
Indemnifying Party acknowledges in writing its obligations to indemnify and hold
harmless under this Section 6.1, the Indemnifying Party shall have the right to
employ such counsel as is reasonably acceptable to the Indemnified Party to
defend any such claim or demand asserted against the Indemnified Party. The
Indemnified Party shall have the right to participate in the defense of any said
claim or demand at its own cost and expense, provided that unless the
Indemnified Party bears a greater risk of loss than the Indemnifying Party, the
Indemnifying Party shall control the defense of said claim or demand. So long as
the Indemnifying Party is defending in good faith any such claim or demand, (i)
the Indemnified Party shall not settle such claim or demand without the prior
written consent of the Indemnifying Party, and (ii) any settlement of such claim
or demand made without such consent of the Indemnifying Party shall not be
subject to indemnity under this Section 6.1. If the Indemnifying Party fails to
acknowledge in writing its obligation to defend against or settle such claim or
proceeding within twenty (20) days after receiving notice thereof from the
Indemnified Party (or such shorter time specified in the notice as the
circumstances of the matter may dictate), the Indemnified Party shall be free to
dispose of the matter at the expense of the Indemnifying Party, in any way in
which the Indemnified Party deems to be in its best interest. Purchaser, in its
reasonable discretion to protect its financial interest may set off the amount
of any legitimate claim for which it may be entitled to indemnification
hereunder against any payment to be made to Seller hereunder. Legitimate claim
shall be defined as any legal proceeding filed in a court having jurisdiction
over the subject matter which claim is not older than three (3) years from the
date of the Closing.
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6.1.5. The Indemnified Party shall make available to the
Indemnifying Party or its representatives all records and other materials
required for use in contesting any claim or demand asserted by a third party
against any Indemnified Party. Whether or not the Indemnifying Party so elects
to defend any such claim or demand, the Indemnified Party shall not have any
obligation to do so and the Indemnified Party shall not waive any rights it may
have against the Indemnifying Party under this Section 6.1 with respect to any
such claim or demand by electing or failing to elect to defend any such claim,
provided that the Indemnified Party against which a claim or demand is asserted
in the first instance shall file in a timely manner any answer or pleading with
respect to a suit or proceeding in such action as is necessary to avoid default
or other adverse results.
SECTION 6.2. Further Assurances. Seller shall, at any time and from
time to time on and after the Closing Date, upon request by Purchaser and
without further consideration, take such actions or cause others to do so, and
execute, acknowledge and deliver, or cause to be executed, acknowledged and
delivered, all transfers, conveyances, powers of attorney and assurances, as may
be required or desirable for the better conveying, transferring, assigning,
delivering, assuring and confirming to Purchaser, or its respective successors
and assigns, or for aiding and assisting in collecting or reducing to
possession, the Purchased Assets; provided, however, that Seller shall not be
required to assist Purchaser in collecting any accounts receivable of Seller
assigned to Purchaser hereunder or pursuing for collection any third parties. To
provide further assurances to Purchaser of its performance hereunder, Seller
agrees that it shall not during the one year period after the Closing Date seek
protection under any bankruptcy, receivership or other law for the relief of
debtors, and Seller further agrees that it shall not voluntarily dissolve or
terminate either or both of the companies comprising the Seller within one year
following the Closing Date unless it shall have provided to Purchaser an
Indemnification Agreement in the form of Exhibit 6.2 hereto, executed and
delivered by Xxxxx X. Xxxxxxxx, Xx. and Xxxxxx XxXxxx, the sole stockholders of
Seller, which shall be executed and delivered to Purchaser prior to, and as an
express condition to, the dissolution or termination of the corporate existence
of either or both of the entities comprising the Seller.
SECTION 6.3. Books and Records. At or immediately following the
Closing, Seller shall deliver to Purchaser all records constituting part of the
Purchased Assets; and all of Seller's correspondence, files, books and records,
necessary for Purchaser's conduct and operation of the Business and the
Purchased Assets; and shall instruct any other party in possession of such
materials to release them to Purchaser (except to the extent that Seller is
prohibited from or restricted in providing such information by other agreements
or applicable law). Seller shall retain the original copies of its tax returns,
and other records which it is required by law to maintain. Purchaser shall
provide Seller with reasonable access to those documents included in the
Purchased Assets which are in the possession of Purchaser from time to time, and
which are necessary for Seller to comply with federal and state securities and
tax laws, which documents shall be stored at
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Purchaser's facilities in New Baltimore, Michigan, or at such other
reasonable location of Purchaser upon prior notification to Seller.
SECTION 6.4. Employees. Seller shall have and retain responsibility for
all wages, bonuses, commissions and vacation pay, all payroll taxes thereon, all
severance and termination benefits, and all other employment benefits accrued up
to and including the Closing Date relating to Seller's employees in connection
with the Business. Moreover, to the extent that the Worker Adjustment and
Retraining Notification Act of 1988 is applicable, Seller shall also be
responsible for giving such notification or taking whatever actions as may be
required by that statute. However, Purchaser represents that on or before the
Closing Date, it will offer employment to all of Seller's employees other than
management personnel and/or stockholders of Seller, on similar or equivalent
terms and with similar or equivalent employee benefits as are customarily
provided by Seller to its employees. In the event any employee of the Seller
does not accept employment with Purchaser for whatever reason, the Seller shall
be responsible for whatever severance or termination benefits that employee may
be due under Seller's employment policies, and Purchaser shall have no liability
whatsoever for the payment of those benefits. It is expressly understood by the
parties that other than provided for in this Section, Purchaser is not assuming
any obligations of Seller with respect to employees, and Seller shall after the
Closing Date remain responsible for all amounts owed to, and claims of whatever
nature made by, its employees related to services provided by them, or to
actions, omissions or conduct of Seller, in accordance with applicable law and
the contractual obligation of Seller.
ARTICLE 7
MISCELLANEOUS
SECTION 7.1. Survival. The representations and warranties of Seller
shall survive Closing.
SECTION 7.2. Termination. Anything herein or elsewhere to the
contrary notwithstanding, this Agreement may be terminated and abandoned
at any time prior to consummation of the transactions contemplated hereby:
7.2.1. By the mutual consent of Purchaser and Seller.
7.2.2. By Purchaser if all of the conditions to Closing
described in Section 4.1 have not been satisfied by April 30, 1996.
7.2.3. By Purchaser if the transactions shall not have been
consummated by April 30, 1996, or such later date as may be agreed upon by the
parties.
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7.2.4. By Purchaser if Seller has materially breached any
representation or warranty herein or failed to perform any material obligation
or condition hereof and such breach or failure shall not have been cured in
manner, form and substance reasonably satisfactory to Purchaser; and
7.2.5. By Seller if either (i) Purchaser has materially
breached any representation or warranty herein or failed to perform any material
obligation or condition hereof and such breach or failure has not been cured in
manner, form and substance reasonably satisfactory to Seller or (ii) Purchaser
shall have failed to close its IPO and shall have failed to close hereunder on
or prior to April 30, 1995.
Any termination pursuant to this Section 7.2 shall be without liability on the
part of any party, except as provided in Section 7.3 below.
SECTION 7.3. Expenses. Each party will pay all of its expenses in
connection with the negotiation of this Agreement, the performance of its
obligations hereunder, and the consummation of the transactions contemplated by
this Agreement. At Closing, Seller shall pay all sales and/or transfer tax which
may be required to be paid in connection with the transactions contemplated
herein including the transfer from Seller to Purchaser of the Purchased Assets.
Seller agrees that the Purchased Assets include unique property that cannot be
readily obtained on the open market and that Purchaser will be irreparably
injured if this Agreement is not specifically enforced. In the event Purchaser
elects to terminate this Agreement as a result of Seller's default instead of
seeking specific performance, Purchaser shall be entitled to recover Purchaser's
actual damages. If Seller terminates this Agreement solely as a result of
Section 7.2.5. hereof, Seller shall be entitled to retain the Deposit as the
sole remedy of Seller hereunder.
SECTION 7.4. Amendments, Waivers and Remedies. The parties hereto, by
mutual agreement in writing, may amend, modify and supplement this Agreement.
The failure of any party hereto to enforce at any time any provision of this
Agreement shall not be construed to be a waiver of such provision, nor in any
way to affect the validity of this Agreement or any part hereof or the right of
any party thereafter to enforce each and every such provision. No waiver of any
breach of this Agreement shall be held to constitute a waiver of any other or
subsequent breach. Pursuit by any party hereto of any remedy shall not preclude
pursuit by it of any other remedy which may be provided by law or equity nor
shall the pursuit of any remedy by a party hereto constitute a forfeiture or
waiver of any amount due such party or of any damage accruing by reason of the
violation of any of the terms, provisions and covenants in this Agreement.
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SECTION 7.5. Notices. All notices or other communications required or
permitted hereunder shall be in writing and shall be deemed to have been duly
given (i) upon delivery if delivered by hand; (ii) four (4) days subsequent to
mailing if mailed by express, certified or registered mail, with postage
prepaid, in the continental United States; (iii) two (2) days subsequent to pick
up by such courier if sent by a nationally or internationally recognized
overnight courier service that regularly maintains records of items picked up
and delivered; or (iv) when transmitted if sent by telecopier, as follows:
If to Purchaser:
Life Critical Care Corporation
c/o The Morgenthau Group, Inc.
Suite 203
0000 Xxxx Xxxxxxxxxx Xxxxxxxxx
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Attn: Xx. Xxx X. Xxxxxx
Fax No.: (000) 000-0000
with a copy to:
Xxxxxx X. Xxxxxx, Esquire
Xxxxxxxxx, Xxxxxx & Xxxxxxx L.L.P.
000 Xxxx Xxxxxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000-0000
Fax No.: (000) 000-0000
If to Seller:
Blue Water Medical Supply, Inc.
00000 Xxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxx 00000
Attn: Xx. Xxx Xxxxxxxx
with a copy to:
Sullivan, Ward, Bone, Tyler & Xxxxx, P.C.
X.X. Xxx 000
0000 Xxxxxxxxx Center, 00000 Xxxxxxxxxxxx Xxx.
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attn: A. Xxxxxx Xxxxxxxx
Fax No: (000) 000-0000
-23-
Any party hereto may specify in writing a different address for such purpose to
the other parties at least five (5) days prior to the effective date of such
address change.
SECTION 7.6. Assignment. This Agreement and all of the provisions
hereof shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and permitted assigns. This Agreement, and the
rights, interests and obligations hereunder, may not be assigned by either party
without the prior written consent of the other party hereto.
SECTION 7.7. Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of such provision or the remaining provision of this Agreement unless the
consummation of the transaction contemplated hereby is adversely affected
thereby.
SECTION 7.8. Complete Agreement. This document and the documents
referred to herein contain the complete agreement between the parties and
supersede any prior understandings, agreements or representations by or between
the parties, written or oral, which may have related to the subject matter
hereof in any way.
SECTION 7.9. No Third-Party Beneficiaries. This Agreement shall
be for the benefit only of the parties hereto, and their respective
successors and assigns.
SECTION 7.10. Waiver of Bulk Sales Act. In consideration of, and in
reliance upon, the representations and warranties made by Seller in Article 2,
Purchaser hereby waives compliance with the provisions of any applicable bulk
transfer laws.
SECTION 7.11. Singular and Plural; Gender. The singular shall
include the plural and vice-versa, and the use of one gender shall be deemed
to include all other genders whenever appropriate.
SECTION 7.12. Governing Law. All questions concerning the construction,
validity and interpretation of this Agreement and the performance of the
obligations imposed by this Agreement will be governed by the laws of the State
of Maryland without reference to any conflict of laws rules.
SECTION 7.13. Counterparts. This Agreement may be executed in two
or more counterparts each of which shall be deemed an original and all of
which together shall constitute one and the same instrument.
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SECTION 7.14. Schedules. The Schedules hereto are an integral part of
this Agreement. Information described in any Schedule of this Agreement shall be
deemed disclosed in all Schedules of this Agreement and the term "Agreement"
shall include all Schedules, exhibits and other deliveries attached or made
pursuant hereto. Except as otherwise specifically provided for herein, any
Schedules which have not been prepared and attached to this Agreement on the
date of execution hereof shall be prepared and delivered by Seller to Purchaser
within ten (10) days from the date of execution of this Agreement.
SECTION 7.15. Headings. The headings and captions set forth herein
are for convenience of reference only and shall not affect the construction or
interpretation hereof.
SECTION 7.16. Further Documents. Seller shall, whenever and as often as
requested to do so by Purchaser, but without expense to Seller, execute,
acknowledge, and deliver all such further conveyances, assignments,
confirmations, satisfactions, releases, instruments of further assurance,
approvals, consents and any and all other further instruments and documents as
may be necessary, expedient, or proper in the reasonable opinion of Purchaser or
its counsel in order to complete the transactions contemplated herein.
SECTION 7.17. Arbitration. Any and all disputes, controversies or
claims that lead up to the execution of this Agreement or that arise out of or
relate to this Agreement or the breach of it, including, without limitation, any
dispute regarding the disposition of the Deposit in the event this Agreement is
terminated and including any claims regarding the validity, scope and
enforceability of this arbitration clause, shall, if not promptly settled by the
parties, be solely and finally resolved by arbitration. The arbitration shall be
conducted in accordance with the commercial arbitration rules of the American
Arbitration Association (the "AAA") in effect at the time and shall be conducted
before a single arbitrator. The parties to the arbitration shall attempt to
agree, by mutual consent, to the appointment of the arbitrator. In the absence
of agreement among the parties, any party to the arbitration may apply to AAA
for a list of arbitrators from which list the arbitrator shall be selected in
accordance with the commercial arbitration rules of AAA.
The arbitration shall take place in Southfield, Michigan. Judgment upon
any award rendered by the arbitrator may be entered in any court of competent
jurisdiction in Michigan and each party hereto consents to the jurisdiction of
such courts and waives all claims of improper venue. The arbitrator shall
determine all claims in accordance with the internal law of the State of
Maryland. The internal procedural and substantive laws of Maryland and the
United States Federal Arbitration Act shall govern all questions of arbitral
procedure, arbitral review, scope of arbitral authority, and arbitral
enforcement. The parties further agree that the arbitration proceeding shall
constitute an absolute bar to
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the institution of any court proceeding, and that the decision and award of the
arbitrator shall be final and binding.
The cost of the arbitration proceeding shall be shared equally by the
parties except that each party shall be responsible for its own attorneys fee,
if any.
SECTION 7.18. Counsel. Each party hereto has been represented by its
own counsel in connection with the negotiation and preparation of this Agreement
and, consequently, each party hereby waives the application of any rule of law
that would otherwise be applicable in connection with the interpretation of this
Agreement, including but not limited to any rule of law to the effect that any
provision of this Agreement shall be interpreted or construed against the party
whose counsel drafted that provision.
SECTION 7.19. No Offer. This Agreement has been provided for
examination only and does not constitute an offer. This Agreement shall become
effective only after execution hereof (or counterparts hereof) by all parties
hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement,
under seal, on the day and year first above written, intending to be legally
bound hereby.
WITNESS: BLUE WATER MEDICAL SUPPLY, INC.
_____________________________ By:_______________________(SEAL)
, President
WITNESS: BLUE WATER INDUSTRIAL PRODUCTS, INC.
_____________________________ By:_______________________(SEAL)
, President
WITNESS: LIFE CRITICAL CARE CORPORATION
_____________________________ By:_______________________(SEAL)
Xxx X. Xxxxxx, Vice President
and Chief Financial Officer
-26-
EXHIBIT 1.2
XXXX OF SALE AND ASSIGNMENT OF ASSETS/
MEDICAL SUPPLY
[ATTACHED]
XXXX OF SALE AND ASSIGNMENT OF ASSETS
THIS XXXX OF SALE AND ASSIGNMENT OF ASSETS is executed and
delivered effective this _____ day of ______________, 1996 by BLUE WATER
MEDICAL SUPPLY, INC., a Michigan corporation, ("Seller"), to LIFE CRITICAL CARE
CORPORATION, a Delaware corporation, ("Purchaser").
WHEREAS, Purchaser and Seller have entered into an Asset Purchase
Agreement, dated as of January 22, 1996 (the "Agreement"), providing for the
purchase by Purchaser of substantially all of the assets of Seller;
NOW, THEREFORE, pursuant to the Agreement, and for good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
Seller hereby grants, bargains, sells, delivers, transfers, sets over, assigns
and conveys to Purchaser and its successors and assigns, free and clear of any
and all liens, claims or encumbrances of any kind, except for any liabilities of
Seller specifically assumed by Purchaser pursuant to the express terms of the
Agreement, all of the Purchased Assets (as defined in the Agreement) including,
without limitation, those assets and properties listed or described on Schedule
A attached hereto and made a part hereof.
TO HAVE AND TO HOLD the Purchased Assets unto Purchaser and its
successors and assigns, to its and their own use and benefit forever, and
Seller, for itself and its successors and assigns, covenants to and agrees with
Purchaser to warrant and defend the sale, transfer, assignment, conveyance and
delivery of the Purchased Assets unto Purchaser and its successors and assigns,
against all lawful claims and demands.
Seller hereby covenants and agrees with Purchaser that it will duly
execute and deliver all such deeds, bills of sale, endorsements, assignments,
drafts, checks, and other instruments of transfer as may be necessary or helpful
more fully to sell, transfer, assign and convey to and to invest in Purchaser,
all and singular, the Purchased Assets hereby sold, transferred, assigned and
conveyed by this Xxxx of Sale and Assignment of Assets.
The transfer evidenced by this Xxxx of Sale and Assignment of Assets is
made subject to and upon all of the terms, covenants, conditions,
representations and warranties set forth in the Agreement, and all of which
terms, covenants, conditions, representations and warranties are incorporated
herein by reference, and shall survive the delivery of this Xxxx of Sale and
Assignment of Assets.
All of the terms and provisions of this Xxxx of Sale and Assignment of
Assets shall be binding upon Seller and its respective successors and assigns,
and shall inure to the benefit of the Purchaser and its successors and assigns.
IN WITNESS WHEREOF, Seller and Purchaser have caused the due execution
of this Xxxx of Sale and Assignment of Assets, under seal, as of the day and
year first above written.
BLUE WATER MEDICAL SUPPLY, INC.
By:______________________(SEAL)
, President
- Seller -
LIFE CRITICAL CARE CORPORATION
By:______________________(SEAL)
- Purchaser -
-2-
SCHEDULE A
TO
XXXX OF SALE AND ASSIGNMENT OF ASSETS
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
EXHIBIT 1.2.A
XXXX OF SALE AND ASSIGNMENT OF ASSETS/
INDUSTRIAL PRODUCTS
[ATTACHED]
XXXX OF SALE AND ASSIGNMENT OF ASSETS
THIS XXXX OF SALE AND ASSIGNMENT OF ASSETS is executed and
delivered effective this _____ day of ________________, 1996 by BLUE WATER
INDUSTRIAL PRODUCTS, INC., a Michigan corporation, ("Seller"), to LIFE
CRITICAL CARE CORPORATION, a Delaware corporation, ("Purchaser").
WHEREAS, Purchaser and Seller have entered into an Asset Purchase
Agreement, dated as of January 22, 1996 (the "Agreement"), providing for the
purchase by Purchaser of substantially all of the assets of Seller;
NOW, THEREFORE, pursuant to the Agreement, and for good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
Seller hereby grants, bargains, sells, delivers, transfers, sets over, assigns
and conveys to Purchaser and its successors and assigns, free and clear of any
and all liens, claims or encumbrances of any kind, except for any liabilities of
Seller specifically assumed by Purchaser pursuant to the express terms of the
Agreement, all of the Purchased Assets (as defined in the Agreement) including,
without limitation, those assets and properties listed or described on Schedule
A attached hereto and made a part hereof.
TO HAVE AND TO HOLD the Purchased Assets unto Purchaser and its
successors and assigns, to its and their own use and benefit forever, and
Seller, for itself and its successors and assigns, covenants to and agrees with
Purchaser to warrant and defend the sale, transfer, assignment, conveyance and
delivery of the Purchased Assets unto Purchaser and its successors and assigns,
against all lawful claims and demands.
Seller hereby covenants and agrees with Purchaser that it will duly
execute and deliver all such deeds, bills of sale, endorsements, assignments,
drafts, checks, and other instruments of transfer as may be necessary or helpful
more fully to sell, transfer, assign and convey to and to invest in Purchaser,
all and singular, the Purchased Assets hereby sold, transferred, assigned and
conveyed by this Xxxx of Sale and Assignment of Assets.
The transfer evidenced by this Xxxx of Sale and Assignment of Assets is
made subject to and upon all of the terms, covenants, conditions,
representations and warranties set forth in the Agreement, and all of which
terms, covenants, conditions, representations and warranties are incorporated
herein by reference, and shall survive the delivery of this Xxxx of Sale and
Assignment of Assets.
All of the terms and provisions of this Xxxx of Sale and Assignment of
Assets shall be binding upon Seller and its respective successors and assigns,
and shall inure to the benefit of the Purchaser and its successors and assigns.
IN WITNESS WHEREOF, Seller and Purchaser have caused the due execution
of this Xxxx of Sale and Assignment of Assets, under seal, as of the day and
year first above written.
BLUE WATER INDUSTRIAL
PRODUCTS, INC.
By:_____________________(SEAL)
, President
- Seller -
LIFE CRITICAL CARE CORPORATION
By:_____________________(SEAL)
- Purchaser -
-2-
SCHEDULE 1.3
EXCLUDED ASSETS
1. Checking accounts of Seller
3. Savings accounts of Seller
4. Life Insurance Policy(ies) of Seller
5. Cash values of any Life Insurance Policy(ies) of Seller
6. Federal and Michigan corporate income tax deposits of Seller
7.
SCHEDULE 1.6
LIABILITIES ASSUMED
[to be provided by Seller, subject to the reasonable approval of
Purchaser, within 30 days following the execution of
the Asset Purchase Agreement]
1.
2.
3.
SCHEDULE 1.7
ALLOCATION OF PURCHASE PRICE/MEDICAL SUPPLY*
_______________________ $__________
_______________________ $__________
_______________________ $__________
Furniture, Fixtures, and
Equipment $__________
_______________________ $__________
Goodwill $__________
TOTAL: $__________
* To be determined by Seller and Purchaser prior to the Closing Date.
SCHEDULE 1.7.A
ALLOCATION OF PURCHASE PRICE/INDUSTRIAL PRODUCTS*
_______________________ $__________
_______________________ $__________
_______________________ $__________
Furniture, Fixtures, and
Equipment $__________
_______________________ $__________
Goodwill $__________
TOTAL: $__________
* To be determined by Seller and Purchaser prior to the Closing Date.
SCHEDULE 2.5.1
LIENS
[to be provided by Seller, subject to the reasonable approval of
Purchaser, within 30 days following the execution of
the Asset Purchase Agreement]
SCHEDULE 2.7
CONTRACTS AND COMMITMENTS
[to be provided by Seller within 30 days following
the execution of the Asset Purchase Agreement]
SCHEDULE 2.8
LITIGATION
[to be provided by Seller within 30 days following
the execution of the Asset Purchase Agreement]
SCHEDULE 2.10
INSURANCE*
1.
2.
3.
4.
5.
* To be provided by Seller within 30 days following the execution of the
Asset Purchase Agreement.
SCHEDULE 2.13
LICENSES AND PERMITS*
1.
2.
3.
4.
5.
* To be provided by Seller within 30 days following the execution of the
Asset Purchase Agreement.
EXHIBIT 4.1.1.2
LEASES
[to be provided by Seller, subject to the reasonable approval of Purchaser,
within 30 days following the execution of the Asset Purchase Agreement --
2 facilities; 4 year lease, 4 year option, purchase option at FMV]
EXHIBIT 4.1.1.3
COVENANT NOT TO COMPETE
COVENANT NOT TO COMPETE made and entered into this ____ day of ______,
1996, by and between _________________________ ("Covenantor") and LIFE CRITICAL
CARE CORPORATION, a Delaware corporation, and its successors and assigns
("Purchaser").
WITNESSETH:
WHEREAS, BLUE WATER MEDICAL SUPPLY, INC. (hereafter called "Seller") is
selling certain operating assets related to its business (the "Business") to
Purchaser in a transaction contemplated in an Asset Purchase Agreement dated
January 22, 1996 (hereafter called the "Agreement") entered into by Seller and
Purchaser; and
WHEREAS, the Covenantor has been a stockholder of Seller involved in
the operation of the Business and is familiar with the operation of the Business
generally; and
WHEREAS, the Covenantor agreed to enter into this Covenant Not to
Compete as an inducement to Purchaser to enter into the Agreement as a result of
which Agreement the Covenantor will materially benefit.
NOW, THEREFORE, the parties hereto do covenant and agree as follows:
1. COVENANT NOT TO COMPETE PAYMENT. Simultaneously with the
delivery of this Covenant Not to Compete, Purchaser has paid to
Seller the sum of One Dollar ($1.00) in cash, or certified check.
2. RESTRICTIVE COVENANT. In consideration for the entry into the
Agreement by the Purchaser, the Covenantor covenants that he will
not, directly or indirectly for a period of five (5) years from
and after the date hereof, own in whole or in part, manage,
operate, control, or perform services for any health care business
located within the States of Michigan, Illinois, Indiana or Ohio.
3. CONFIDENTIAL INFORMATION. For a period of ten (10) years from
and after the date hereof, the Covenantor shall hold all
Confidential Information (i.e., all trade secrets and
proprietary and confidential information regarding the Business
of whatever nature, in whatever medium, developed, owned or
acquired by the Seller or the Covenantor, including customers
and prospective customers and suppliers but excluding
information which at the time of
disclosure is in the public domain through no fault of, or
violation of law or breach of agreement by the Covenantor or
which the Covenantor can demonstrate he has lawfully
obtained from a third party under circumstances permitting
its lawful disclosure and use which the Covenantor reasonably
believes has no obligation of confidentiality with respect
thereto) in confidence and not disclose, duplicate, communicate
or transmit the Confidential Information to any person or use or
exploit any Confidential Information for any purpose.
4. REASONABLENESS. The Covenantor hereby expressly agrees that any
competition by him with the Business in violation of the terms of this Covenant
Not to Compete would, among other things, materially impair the Purchaser's
future prospects and that the limitations set forth in Paragraph 2 above are
reasonable, both as to time and geographic area. If, notwithstanding the
foregoing, the scope of any restriction contained in Paragraph 2 is too broad to
permit enforcement thereof to its full extent, such restriction shall be
enforced to the maximum extent permitted by law, and Covenantor hereby agrees
that such scope may be judicially modified accordingly in any proceeding brought
to enforce such restriction.
5. INJUNCTIVE RELIEF. The Covenantor hereby recognizes that in the
event of his breach of any of the covenants hereunder Purchaser's remedies at
law for money damages would be inadequate, and, therefore, the Covenantor hereby
stipulates that Purchaser shall be entitled to injunctive relief in the event of
any breach of the Covenantor's covenants hereunder.
6. INTERPRETATION. This Covenant Not to Compete and the provisions
hereof shall in all respects be interpreted under and regulated by the laws
of the State of Michigan except for the choice of law rules utilized in that
jurisdiction.
7. AMENDMENT. This Covenant Not to Compete contains all the
understandings of the parties and shall not be altered or amended, except in a
writing signed by each of the parties hereto.
8. ATTORNEYS' FEES. The Covenantor hereby agrees that, in the
event of a breach of the Covenantor's covenants hereunder, Purchaser
shall be entitled to recover such costs, damages and reasonable attorneys'
fees as may be incurred on account of such breach from the Covenantor.
9. BINDING EFFECT. This Covenant Not to Compete shall be binding
upon the parties and their respective successors and assigns.
-2-
10. COUNTERPARTS. This Covenant Not to Compete may be executed in
two or more counterparts, each of which, when taken together, shall constitute
one and the same original.
IN WITNESS WHEREOF, the parties have caused this Covenant Not to
Compete to be executed under seal on the day and year first above written.
COVENANTOR:
___________________________(SEAL)
[ONE SET TO BE EXECUTED BY EACH STOCKHOLDER
OF BLUE WATER MEDICAL SUPPLY, INC. AND BLUE
WATER INDUSTRIAL PRODUCTS, INC.]
PURCHASER:
LIFE CRITICAL CARE CORPORATION
By:________________________(SEAL)
-3-
EXHIBIT 4.1.1.6
OPINION OF COUNSEL FOR SELLER
[Letterhead of Sullivan, Ward, Bone, Tyler & Xxxxx, P.C.]
______________, 1996
Life Critical Care Corporation
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxx X. Xxxxxx, President
Ladies and Gentlemen:
This opinion is delivered pursuant to Section 4.1.1.6 of the Asset
Purchase Agreement, dated January 22, 1996 (the "Agreement"), between Blue Water
Medical Supply, Inc. ("Medical Supply") and Blue Water Industrial Products, Inc.
("Industrial Products") (collectively and individually referred to herein as the
"Company") and Life Critical Care Corporation (the "Purchaser"). We have acted
as counsel to the Company in connection with the Agreement and the transactions
contemplated thereby. Where a term that is defined in the Agreement is used in
this Opinion, the term has the same meaning set forth in the Agreement, unless
differently defined herein.
(1) In rendering the opinions set forth below, we have examined:
(A) The fully executed Agreement; and
(B) The Charter, By-Laws and minutes of the corporate
proceedings of each Company.
(2) In rendering the opinions set forth below, we have assumed:
(A) Each of the parties to the Agreement other than our clients
have the power and authority to: (i) enter into the Agreement and all other
agreements or documents required to be executed by it pursuant to the Agreement;
and (ii) perform all of its obligations under the Agreement and all other
agreements or documents required to be executed by it pursuant to the Agreement;
(B) All required corporate actions and authorizations other
than on behalf of our clients have been completed; and
(C) The authenticity of all documents submitted as originals,
the genuineness of all signatures other than signatures on behalf of our clients
and the conformity to the originally executed documents of all documents
submitted to us as drafts or photocopies.
In rendering our opinions, whenever our opinion herein regarding the
existence or absence of facts is indicated to be based on our knowledge or
awareness, our opinion is intended to signify that during the course of our
representation of the Company no information has come to our attention which
would give us actual knowledge of the existence or absence of such facts. We
have not undertaken any independent investigation to determine the existence or
absence of such facts and no inference of further knowledge should be drawn from
our representation of the Company. As to various questions of fact material to
this Opinion, we have relied upon the truth and completeness of the
representations and warranties made by each Company as the "Seller" in the
Agreement and upon certifications executed by the Officers and Directors of each
Company. In addition, we have obtained from public officials and from officers
of each Company such other certificates and assurances, and we have examined
such corporate records, other documents and questions of law, as we have
considered necessary or appropriate for purposes of this Opinion.
Based upon the foregoing, and subject to the limitations and
qualifications set forth herein, it is our opinion that, as of the date of this
letter:
(A) Each Company is a corporation duly organized, validly
existing and in good standing under the laws of the state of Michigan, and has
the corporate power to own all of its properties and assets and to carry on its
business as it is now being conducted.
(B) Each Company has validly taken all necessary corporate
action to authorize it to execute and deliver the Agreement and to consummate
the transactions contemplated thereby; and the Agreement has been duly executed
and delivered by each Company and is a valid and binding agreement of each
Company, enforceable in accordance with its terms.
(C) The execution and delivery of the Agreement by each Company
and the consummation by each Company of the transactions contemplated on its
part thereby do not and will not violate any provision of the Charter or By-Laws
of either Company.
-2-
(D) To our knowledge, all consents, authorizations, orders or
approvals of, and filings and registrations with, any governmental commission,
board or other regulatory body required for or in connection with the execution
and delivery of the Agreement by each Company and the consummation by it of the
transactions contemplated on its part thereby have been obtained or made.
(E) To our knowledge, except as disclosed on any Schedule to the
Agreement, there is no claim, action, suit or legal, administrative or other
proceeding or governmental investigation, pending or threatened against either
Company or any of its properties which might result in any material adverse
change in the business or financial condition of either Company.
(F) To the best of our knowledge, neither the execution and
delivery of the Agreement, nor the consummation of the transactions contemplated
thereby, conflicts with or does or will violate or result (with the giving of
notice and/or the passage of time) in a breach of any of the terms, conditions
or provisions of or constitute a default under, any lease, mortgage, contract or
other agreement binding on either Company or affecting its properties. To the
best of our knowledge, no consent or approval of any public authority is
required as a condition to the validity or enforceability of the Agreement or
any transaction contemplated thereby.
The foregoing Opinion is subject to the following
qualifications:
(A) The Opinion is subject to the operation and effect of
applicable bankruptcy, insolvency, moratorium, reorganization, receivership or
other similar laws, statutes or rules now or hereafter in effect affecting the
rights of creditors generally and the rights of taxing authorities.
(B) The enforceability of the Agreement may require enforcement
by a court of equity, and such enforcement is subject to such principles of
equity as courts having jurisdiction may impose.
(C) In rendering our opinion regarding the good standing of each
Company, we have relied exclusively upon Certificates of Good Standing, dated
_______________, 1996, issued by the Michigan Department of Commerce,
Corporations and Securities Bureau.
(D) Our Opinion is based solely upon the laws of the State of
Michigan, and we are opining herein as to the subject transaction as though the
laws of the United States of America and the State of Michigan were the only
applicable laws. We assume no responsibility as to the applicability thereto or
affect thereon of the laws of any other state or jurisdiction. As to matters
governed or affected by laws of states other than the State of Michigan we have
assumed that insofar as the substantive laws of any other state may be
-3-
applicable to any opinions herein, such laws are identical to the substance of
laws of the State of Michigan applied by us herein.
This opinion is being furnished to you solely for your benefit and the
benefit of your counsel and may not be relied upon by, nor copies of it
delivered to, any other person or parties without our prior written consent.
SULLIVAN, WARD, BONE,
TYLER & XXXXX, P.C.
By: ____________________________
-4-
EXHIBIT 4.1.1.7
ARTICLES OF TRANSFER
BETWEEN
[BLUE WATER _________________, INC.]
AND
LIFE CRITICAL CARE CORPORATION
THIS IS TO CERTIFY THAT:
FIRST: Blue Water _________________________, Inc. a Michigan
corporation (the "Transferor"), agrees to transfer all or substantially all
of its property and assets to Life Critical Care Corporation, a Delaware
corporation (the "Transferee") pursuant to the terms of an Asset Purchase
Agreement between the Transferor and the Transferee of even date herewith.
SECOND: The Transferor is incorporated under the laws of the
State of Michigan, with a principal office located at 00000 Xxxxx Xxxxxx, Xxx
Xxxxxxxxx, XX 00000.
THIRD: The Transferee is incorporated under the general laws of
the State of Delaware. The Transferee's address and principal place of business
is 0000 Xxxx Xxxxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxx Xxxxxxxxxx, Xxxxxxx 00000.
FOURTH: The Transferor owns no interest in land, the title
to which could be affected by the recording of an instrument among the land
records.
FIFTH: The terms and conditions of the transaction set forth in
these Articles of Transfer were advised, authorized and approved by the
Transferor in the manner and by the vote required by its Articles of
Incorporation and Michigan law, in the following manner: The Board of Directors
of the Transferor by unanimous written consent adopted a resolution declaring
that the proposed transaction described herein was advisable, and directed that
the proposed transaction be submitted to the stockholders of the Transferor for
consideration and approval. The Shareholders of the Transferor by unanimous
written consent adopted a resolution declaring that the proposed transaction
described herein was approved.
SIXTH: The terms and conditions of the transaction set forth in
these Articles of Transfer were advised, authorized and approved by the
Transferee in the manner and by the vote required by its Charter and the laws of
the place of its incorporation, in the following manner: The Board of Directors
of the Transferee by unanimous written consent adopted a resolution declaring
that the proposed transaction was approved.
SEVENTH: The nature and amount of the consideration to be paid
by the Transferee to the Transferor for the assets to be transferred by the
Transferor pursuant to the Asset Purchase Agreement is
___________________________________________ Dollars ($_______________).
IN WITNESS WHEREOF, on this day of , 1996, Transferor has caused
these Articles of Transfer to be executed on its behalf by its President and
attested by its Secretary, and Transferee has caused these Articles of Transfer
to be executed on its behalf by its President and attested by its Secretary, and
each individual signing hereby acknowledges, under penalties for perjury, that
these Articles of Transfer are the act of the party on whose behalf such
individual is executing the Articles of Transfer and that, to the best of his or
her knowledge, information and belief, the facts and matters set forth herein
are true in all material respects.
ATTEST: BLUE WATER ______________________, INC.
_______________________________ By:______________________________(SEAL)
, Secretary , President
ATTEST: LIFE CRITICAL CARE CORPORATION
_______________________________ By:______________________________(SEAL)
, Secretary
-2-
EXHIBIT 4.2.1.2
ASSIGNMENT AND ASSUMPTION AGREEMENT/MEDICAL SUPPLY
ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS ASSIGNMENT AND ASSUMPTION AGREEMENT is made this _____ day
of _______________, 1996, by and between LIFE CRITICAL CARE CORPORATION, a
Delaware corporation, ("Purchaser"), and BLUE WATER MEDICAL SUPPLY, INC., a
Michigan corporation, ("Seller").
WHEREAS, pursuant to that certain Asset Purchase Agreement,
dated January 22, 1996, between the parties hereto (the "Purchase Agreement"),
Seller has agreed to assign and transfer to Purchaser certain assets, properties
and business of Seller;
NOW, THEREFORE, in consideration of the transfer to Purchaser of
the aforesaid assets, and for other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties agree as follows:
1. Assignment. Seller hereby assigns and transfers to Purchaser
the following: All right, title and interest of Seller in, to and under all
contracts, leases, indentures, agreements, commitments and all other legally
binding arrangements, whether oral or written, to which Seller is a party or by
which Seller is bound ("Contracts") that are listed on Schedule A hereto.
2. Assumption. Subject to the further terms of this Agreement,
effective on the date hereof, Purchaser, for itself and its successors and
assigns, hereby covenants and agrees to assume, and hereby does assume, and
agrees to discharge, perform, and observe, and to indemnify, defend, and hold
Seller harmless from and against the obligations of Seller, as and to the extent
arising from and after the date hereof, or pertaining to any period subsequent
to the date hereof, as are listed or described on Schedule B, attached hereto
and made a part hereof (the "Assumed Liabilities").
3. Indemnification. Seller shall defend, indemnify, and hold
Purchaser harmless against and from (a) all liability to any person, firm,
corporation, political subdivision, or other entity for any default by Seller in
connection with the Assumed Liabilities to the extent such default occurs prior
to the date hereof, and (b) any debt, liability, obligation or contract not
expressly assumed by Purchaser hereunder. Purchaser shall defend, indemnify and
hold Seller harmless against and from any and all liability to any person, firm,
corporation, political subdivision, or other entity for any default by Purchaser
in connection with the Assumed Liabilities, to the extent such default occurs on
or after the date hereof. The indemnifications set forth herein are in addition
to any indemnifications set forth in the Purchase Agreement.
4. Representations of Seller. All representations and warranties
of Seller relating to the Assumed Liabilities contained in the Purchase
Agreement are hereby
incorporated by reference herein. Seller hereby further represents and
warrants to Purchaser that, as of the effective date of this Agreement,
Seller has not received notice of any default by Seller in connection with the
Assumed Liabilities, and to the best of Seller's knowledge, information and
belief, Seller is not in default in connection with the Assumed Liabilities.
5. Further Assurances. The parties agree that they will take
whatever action or actions are found to be reasonably necessary from time to
time to effectuate the provisions and intent of this Agreement, and, to that
end, the parties agree that they will execute any further documents or
instruments which may be necessary to give full force and effect to this
Agreement or to any of its provisions.
6. Binding Effect. This Agreement shall be binding upon,
and shall inure to the benefit of, the parties hereto and their respective
successors and assigns.
7. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Maryland.
8. Miscellaneous. This Agreement is made and entered into
pursuant to the terms, conditions, and provisions of the Purchase Agreement.
Except as otherwise provided herein or except as otherwise required by the
context herein, all capitalized terms defined in the Purchase Agreement shall
have such defined meanings when used herein.
IN WITNESS WHEREOF, the parties hereto have caused the due
execution of this Assignment and Assumption Agreement, under seal, as of the day
and year first above written.
WITNESS: BLUE WATER MEDICAL SUPPLY, INC.
______________________________ By: _____________________(SEAL)
, President
- SELLER -
WITNESS: LIFE CRITICAL CARE CORPORATION
______________________________ By: _____________________(SEAL)
, President
- PURCHASER -
-2-
SCHEDULE A
TO
ASSIGNMENT AND ASSUMPTION AGREEMENT
-3-
SCHEDULE B
TO
ASSIGNMENT AND ASSUMPTION AGREEMENT
-4-
EXHIBIT 4.2.1.2.A
ASSIGNMENT AND ASSUMPTION AGREEMENT/INDUSTRIAL PRODUCTS
ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS ASSIGNMENT AND ASSUMPTION AGREEMENT is made this _____ day
of _______________, 1996, by and between LIFE CRITICAL CARE CORPORATION, a
Delaware corporation, ("Purchaser"), and BLUE WATER INDUSTRIAL PRODUCTS, INC., a
Michigan corporation, ("Seller").
WHEREAS, pursuant to that certain Asset Purchase Agreement,
dated January 22, 1996, between the parties hereto (the "Purchase Agreement"),
Seller has agreed to assign and transfer to Purchaser certain assets, properties
and business of Seller;
NOW, THEREFORE, in consideration of the transfer to Purchaser of
the aforesaid assets, and for other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties agree as follows:
1. Assignment. Seller hereby assigns and transfers to Purchaser
the following: All right, title and interest of Seller in, to and under all
contracts, leases, indentures, agreements, commitments and all other legally
binding arrangements, whether oral or written, to which Seller is a party or by
which Seller is bound ("Contracts") that are listed on Schedule A hereto.
2. Assumption. Subject to the further terms of this Agreement,
effective on the date hereof, Purchaser, for itself and its successors and
assigns, hereby covenants and agrees to assume, and hereby does assume, and
agrees to discharge, perform, and observe, and to indemnify, defend, and hold
Seller harmless from and against the obligations of Seller, as and to the extent
arising from and after the date hereof, or pertaining to any period subsequent
to the date hereof, as are listed or described on Schedule B, attached hereto
and made a part hereof (the "Assumed Liabilities").
3. Indemnification. Seller shall defend, indemnify, and hold
Purchaser harmless against and from (a) all liability to any person, firm,
corporation, political subdivision, or other entity for any default by Seller in
connection with the Assumed Liabilities to the extent such default occurs prior
to the date hereof, and (b) any debt, liability, obligation or contract not
expressly assumed by Purchaser hereunder. Purchaser shall defend, indemnify and
hold Seller harmless against and from any and all liability to any person, firm,
corporation, political subdivision, or other entity for any default by Purchaser
in connection with the Assumed Liabilities, to the extent such default occurs on
or after the date hereof. The indemnifications set forth herein are in addition
to any indemnifications set forth in the Purchase Agreement.
4. Representations of Seller. All representations and warranties
of Seller relating to the Assumed Liabilities contained in the Purchase
Agreement are hereby incorporated by reference herein. Seller hereby further
represents and warrants to Purchaser that, as of the effective date of this
Agreement, Seller has not received notice of
any default by Seller in connection with the Assumed Liabilities, and to the
best of Seller's knowledge, information and belief, Seller is not in default in
connection with the Assumed Liabilities.
5. Further Assurances. The parties agree that they will take
whatever action or actions are found to be reasonably necessary from time to
time to effectuate the provisions and intent of this Agreement, and, to that
end, the parties agree that they will execute any further documents or
instruments which may be necessary to give full force and effect to this
Agreement or to any of its provisions.
6. Binding Effect. This Agreement shall be binding upon,
and shall inure to the benefit of, the parties hereto and their respective
successors and assigns.
7. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Maryland.
8. Miscellaneous. This Agreement is made and entered into
pursuant to the terms, conditions, and provisions of the Purchase Agreement.
Except as otherwise provided herein or except as otherwise required by the
context herein, all capitalized terms defined in the Purchase Agreement shall
have such defined meanings when used herein.
IN WITNESS WHEREOF, the parties hereto have caused the due
execution of this Assignment and Assumption Agreement, under seal, as of the day
and year first above written.
WITNESS: BLUE WATER INDUSTRIAL
PRODUCTS, INC.
______________________________ By: ___________________________(SEAL)
, President
- SELLER -
WITNESS: LIFE CRITICAL CARE CORPORATION
______________________________ By: ___________________________(SEAL)
, President
- PURCHASER -
-2-
SCHEDULE A
TO
ASSIGNMENT AND ASSUMPTION AGREEMENT
-3-
SCHEDULE B
TO
ASSIGNMENT AND ASSUMPTION AGREEMENT
-4-
EXHIBIT 4.2.1.4
OPINION OF COUNSEL FOR PURCHASER
[Letterhead of Xxxxxxxxx, Xxxxxx & Preston L.L.P.]
______________, 1996
Blue Water Medical Supply, Inc. and
Blue Water Industrial Products, Inc.
00000 Xxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxx Xxxxxxxx
Ladies and Gentlemen:
This opinion is delivered pursuant to Section 4.2.1.4 of the
Asset Purchase Agreement, dated _______________, 1996 (the "Agreement"),
between Blue Water Medical Supply, Inc. ("Medical Supply") and Blue Water
Industrial Products, Inc. ("Industrial Products") (collectively and
individually referred to herein as the "Company") and Life Critical Care
Corporation (the "Purchaser"). We have acted as counsel to the Purchaser in
connection with the Agreement and the transactions contemplated thereby. Where a
term that is defined in the Agreement is used in this Opinion, the term has the
same meaning set forth in the Agreement, unless differently defined herein.
(1) In rendering the opinions set forth below, we have examined:
(A) The fully executed Agreement; and
(B) The Charter, By-Laws and minutes of the corporate
proceedings of the Purchaser.
(2) In rendering the opinions set forth below, we have assumed:
(A) Each of the parties to the Agreement other than our clients
have the power and authority to: (i) enter into the Agreement and all other
agreements or documents required to be executed by it pursuant to the Agreement;
and (ii) perform all of its obligations under the Agreement and all other
agreements or documents required to be executed by it pursuant to the Agreement;
(B) All required corporate actions and authorizations other
than on behalf of our clients have been completed; and
(C) The authenticity of all documents submitted as originals,
the genuineness of all signatures other than signatures on behalf of our clients
and the conformity to the originally executed documents of all documents
submitted to us as drafts or photocopies.
In rendering our opinions, whenever our opinion herein regarding the
existence or absence of facts is indicated to be based on our knowledge or
awareness, our opinion is intended to signify that during the course of our
representation of the Purchaser no information has come to our attention which
would give us actual knowledge of the existence or absence of such facts. We
have not undertaken any independent investigation to determine the existence or
absence of such facts and no inference of further knowledge should be drawn from
our representation of the Purchaser. As to various questions of fact material to
this Opinion, we have relied upon the truth and completeness of the
representations and warranties made by the Purchaser as the "Purchaser" in the
Agreement and upon certifications executed by the Officers and Directors of the
Purchaser. In addition, we have obtained from public officials and from officers
of the Purchaser such other certificates and assurances, and we have examined
such corporate records, other documents and questions of law, as we have
considered necessary or appropriate for purposes of this Opinion.
Based upon the foregoing, and subject to the limitations and
qualifications set forth herein, it is our opinion that, as of the date of this
letter:
(A) The Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware, and has
the corporate power to own all of its properties and assets and to carry on its
business as it is now being conducted.
(B) The Purchaser has validly taken all necessary corporate
action to authorize it to execute and deliver the Agreement and to consummate
the transactions contemplated thereby; and the Agreement has been duly executed
and delivered by the Purchaser and is a valid and binding agreement of the
Purchaser, enforceable in accordance with its terms.
(C) The execution and delivery of the Agreement by the Purchaser
and the consummation by the Purchaser of the transactions contemplated on its
part thereby do not and will not violate any provision of the Charter or By-Laws
of the Purchaser.
(D) To our knowledge, all consents, authorizations, orders or
approvals of, and filings and registrations with, any governmental commission,
board or other regulatory body required for or in connection with the execution
and delivery of the Agreement by the Purchaser and the consummation by it of the
transactions contemplated on its part thereby have been obtained or made.
-2-
(E) To the best of our knowledge, neither the execution and
delivery of the Agreement, nor the consummation of the transactions contemplated
thereby, conflicts with or does or will violate or result (with the giving of
notice and/or the passage of time) in a breach of any of the terms, conditions
or provisions of or constitute a default under, any lease, mortgage, contract or
other agreement binding on the Purchaser or affecting its properties. To the
best of our knowledge, no consent or approval of any public authority is
required as a condition to the validity or enforceability of the Agreement or
any transaction contemplated thereby.
The foregoing Opinion is subject to the following
qualifications:
(A) The Opinion is subject to the operation and effect of
applicable bankruptcy, insolvency, moratorium, reorganization, receivership or
other similar laws, statutes or rules now or hereafter in effect affecting the
rights of creditors generally and the rights of taxing authorities.
(B) The enforceability of the Agreement may require enforcement
by a court of equity, and such enforcement is subject to such principles of
equity as courts having jurisdiction may impose.
(C) In rendering our opinion regarding the good standing of each
Company, we have relied exclusively upon a Certificate of Good Standing, dated
_______________, 1996, issued by the Maryland State Department of Assessments
and Taxation.
(D) Our Opinion is based solely upon the laws of the State of
Maryland, and we are opining herein as to the subject transaction as though the
laws of the United States of America and the State of Maryland were the only
applicable laws. We assume no responsibility as to the applicability thereto or
affect thereon of the laws of any other state or jurisdiction. As to matters
governed or affected by laws of states other than the State of Maryland we have
assumed that insofar as the substantive laws of any other state may be
applicable to any opinions herein, such laws are identical to the substance of
laws of the State of Maryland applied by us herein.
This opinion is being furnished to you solely for your benefit and the
benefit of your counsel and may not be relied upon by, nor copies of it
delivered to, any other person or parties without our prior written consent.
XXXXXXXXX, XXXXXX & XXXXXXX L.L.P.
By: ___________________________________
-3-
EXHIBIT 6.2
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (this "Agreement") is made this _____
day of ___________, 1996, by XXXXX X. XXXXXXXX, XX. and XXXXXX XXXXXX (jointly
and severally, the "Indemnifying Parties") to and for the benefit of LIFE
CRITICAL CARE CORPORATION ("LCCC") and its successors and assigns (collectively,
with LCCC, the "Indemnified Parties").
RECITALS
Pursuant to an Asset Purchase Agreement dated January 22, 1996 (the
"Purchase Agreement"), LCCC has acquired substantially all of the assets of Blue
Water Medical Supply, Inc. ("Medical Supply") and of Blue Water Industrial
Products, Inc. ("Industrial Products") (Medical Supply and Industrial Products
are referred to herein collectively as the "Seller").
Section 6.2 of the Purchase Agreement requires that, prior to any
dissolution or termination of either or both of the companies comprising the
Seller, the Indemnifying Parties, who were the sole stockholders of each Seller
and who were active in the operations of the businesses of each company
comprising the Seller prior to the closing under the Purchase Agreement, must
execute and deliver to LCCC this Agreement and provide the indemnity herein set
forth with respect to certain provisions of the Purchase Agreement.
NOW, THEREFORE, in consideration of the foregoing, and of other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties, intending to be legally bound, agree as follows:
1. Indemnification. The Indemnifying Parties and each of them, jointly
and severally, hereby agree to indemnify, save and keep the Indemnified Parties
forever harmless against and from all liabilities to LCCC by the Seller under
Section 6.1 of the Purchase Agreement and pursuant to the provisions of Section
6.1 of the Purchase Agreement to the same effect as if the Indemnifying Parties
were the "Seller" under the Purchase Agreement; provided, however, that in no
event shall the amount to be paid by the Indemnifying Parties pursuant to this
Agreement exceed the amount of the aggregate Purchase Price actually paid to the
Seller pursuant to the Purchase Agreement and further provided, however, that
the indemnification hereunder shall only apply to claims, etc. that are included
in notices to the Indemnifying Parties within one (1) year from the date of
closing under the Purchase Agreement.
1. Recitals. The foregoing recitals are and the same shall be
included in the terms of this Agreement.
2. Notice. Any notice provided for herein shall be validly given,
made or served if in writing delivered personally or by certified mail return
receipt requested, postage prepaid, addressed to the party at his last known
address.
3. Termination. This Agreement may only be terminated by the
mutual agreement of the parties hereto, in writing.
4. Entire Agreement. This instrument contains the entire
agreement between the parties with respect to the matters contained
herein. It may not be changed orally but only by agreement in writing and
signed by the party against whom enforcement of any waiver, change, modification
or discharge is sought.
5. Choice of Law. The Agreement shall be construed, interpreted
and enforced under the laws of the State of Maryland, exclusive of the
conflicts of law rules of that State.
6. Severability. In the event that one or more provisions of this
Agreement shall be declared invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or impaired
thereby.
7. Counterparts. This Agreement may be executed in counterparts,
each of which shall be an original, but all of which shall together
constitute one document.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
under seal on the date first above written with the intention that it shall
constitute a document under seal.
WITNESS: LIFE CRITICAL CARE CORPORATION
__________________________ By:___________________________(SEAL)
WITNESS:
__________________________ By:___________________________(SEAL)
Xxxxx X. Xxxxxxxx, Xx.
WITNESS:
__________________________ By:___________________________(SEAL)
Xxxxxx XxXxxx
-2-
