ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (the "Agreement")
is made as of February ___, 1996, by and among Mag-Head
Engineering Company, Inc., a Minnesota corporation
("Seller"), and Ahead Technology Acquisition Corporation,
a Delaware corporation ("Purchaser"). Seller is
sometimes referred to in this Agreement as "Selling
Party" or "Selling Parties."
RECITALS
A. Seller is in the business of manufacturing,
selling and distributing magnetic recording heads (the
"Business").
B. Seller desires to sell certain specified
property and assets and to assign certain specified
agreements to Purchaser, and Purchaser desires to acquire
such property and assets, and assume such agreements, on
the terms and conditions specified in this Agreement.
NOW, THEREFORE, in consideration of the mutual
covenants, agreements, representations and warranties
contained in this Agreement, the parties hereto agree as
follows:
1. Purchase and Sale of Assets: Assumption of
Certain Liabilities.
1.1 Assets Purchased. Upon the terms and
subject to the conditions of this Agreement, Purchaser
shall purchase, and Seller shall sell, assign, transfer
and convey to Purchaser at the Closing (as defined in
Section 9 hereof), all of the following tangible and
intangible assets, properties, licenses, and rights
(collectively the "Assets"), free and clear of all liens,
claims, options, rights of third parties and
encumbrances, whether contingent or otherwise:
1.1.1 All equipment, machinery,
furniture, fixtures, leasehold improvements, tools, trade
fixtures, and other tangible property of Seller (whether
such property constitutes real, personal or mixed
property), listed on Schedule 1.1.1 hereof ("Fixed
Assets").
1.1.2 All inventory, work in progress,
and stock in trade of Seller as of the Closing Date.
1.1.3 All rights of Seller under all
accounts receivable, customer sales/purchase orders for
Seller's products, distributor agreements, supply and
maintenance contracts, personal property leases (and the
remaining term under the Lease (as defined in Section
1.3.2 below)), purchase orders and barter arrangements,
and the rights of Seller to all prepaid expenses and
benefits under the foregoing, as set forth in Schedule
1.1.3 attached hereto.
1.1.4 All service marks, patents,
trademarks, copyrights, designs, brand names, trade
names, know-how, processes, symbols, inventions,
programs, trade secrets, logos and telephone numbers
related to or connected with the Business, including,
without limitation, the product catalogues used or
distributed by Seller in connection with the Business and
the names "MEC" and "Mag-Head Engineering Company," and
all derivations thereof, all lists of suppliers,
customers and prospects, all Federal and state
applications for protection or registration of any of the
foregoing and all intangibles appurtenant thereto, and
all rights and properties listed on Schedule 1.1.4
("Proprietary Rights").
1.1.5 All files and correspondence
pertaining to customers, prospects and suppliers,
including, without limitation, customer service, sales,
manufacturing and warranty files and records, and all
other documents, materials and supplies related to the
Business ("Business Records").
1.2 Excluded Assets. It is expressly agreed
that Purchaser shall purchase only those Assets described
in this Agreement (including without limitation, the
Schedules attached hereto). In particular, and without
otherwise limiting or reducing the scope of the preceding
sentence, the parties specifically acknowledge that
Purchaser shall not purchase any of the following
("Excluded Assets"): (i) any tangible or intangible
assets listed in Schedule 1.2 hereof.
1.3 Assumption of Certain Liabilities.
Purchaser shall assume no liabilities or obligations of
Seller whatsoever, except for the following liabilities
("Assumed Liabilities") which Purchaser shall assume,
discharge, perform when due, and indemnify Seller
against:
1.3.1 Seller's obligations from and after
the Closing Date with respect to the personal property
leases and agreements identified on Schedule 1.3 hereto.
1.3.2 Seller's obligations from and after
the Closing Date with respect to the real property lease
covering the premises on which Seller conducted the
Business and identified on Schedule 1.3 hereto (the
"Lease"), pursuant to an Assignment of Lease, executed by
Seller and the landlord for such premises, and in
substantially the form set forth in Schedule 1.3.
1.3.3 Those certain accounts payable of
Seller identified on Schedule 1.3 attached hereto.
1.4 Liabilities Not Assumed. Notwithstanding
anything in this Agreement to the contrary, Purchaser
shall not assume, discharge or indemnify Seller against
any debt, obligation or liability of any kind not
expressly assumed pursuant to Section 1.3 hereof. In
particular, and without otherwise limiting or reducing
the scope of the preceding sentence, the parties
specifically acknowledge that Purchaser shall not assume,
discharge, or indemnify Seller against any of the
following:
1.4.1 Debts, liabilities, obligations or
commitments arising out of or related to or created by
this Agreement or the transactions contemplated hereby
(including, without limitation, any federal or state
income or franchise tax liabilities or sales or use tax
liabilities).
1.4.2 Debts, liabilities, obligations or
commitments arising out of, or related to the Assets
(unless expressly assumed pursuant to this Agreement) or
the Business of Seller, including, without limitation,
debts, liabilities, obligations or commitments arising
out of or related to Seller's payroll obligations
(including, without limitation, vacation pay, severance
pay, bonuses, etc.), utilities, leases of real property,
retirement or profit sharing plans, medical plans,
insurance policies, and worker's compensation
obligations.
2. Purchase Price; Adjustments.
2.1 Purchase Price. The purchase price (the
"Purchase Price") for the Assets shall consist of the sum
of (a) $225,000, and (b) the amount of (x) cash and
accounts receivable less (y) accounts payable and accrued
payroll expenses, as indicated on the October 31, 1995
balance sheet of Seller, which is one of the Financial
Statements (as defined in Section 3.3, below). Purchaser
shall be entitled to a credit against the Purchase Price
for an amount equal to the accrued but unused vacation
pay of Seller's employees, which accrued prior to
November 1, 1995, but was paid by Seller between November
1, 1995 and the Closing Date.
2.2 Payment. At Closing, Purchaser shall pay
to Seller the Purchase Price in cash, subject to credits
and adjustments under this Agreement.
2.3 Adjustment to Purchase Price. The
Purchase Price shall be adjusted as follows:
2.3.1 The Purchase Price shall be reduced
to reflect certain changes in the accounts receivable and
accounts payable of the Seller and payments made by
Seller not in the ordinary course of business of Seller
(including, without limitation, (i) costs arising in
connection with the consummation of the transactions
under this Agreement, and (ii) payroll and other employee
expenses arising from Seller's termination of employees)
between October 31, 1995 and the Closing Date, and such
other adjustments as mutually agreed by the parties in
good faith.
2.3.2 Purchaser shall be entitled to a
credit against the Purchase Price equal to the amount of
cash of Seller on hand at Closing (as defined in Section
9), as certified by Seller, in form and substance
acceptance to Purchaser, that is not surrendered to
Purchaser at Closing.
2.4 Allocation. The Purchase Price and the
Assumed Liabilities shall be allocated among the Assets
in the manner set forth in Schedule 2.4 hereof, as may be
required pursuant to Section 1060 of the Internal Revenue
Code of 1986, as amended. Purchaser and Seller shall
report this transaction for federal and state income tax
purposes in accordance with such allocation.
3. Representations and Warranties of Seller.
Seller represents and warrants to Purchaser as
follows:
3.1 Corporate Existence and Organization.
Seller is a corporation duly organized, validly existing
and in good standing under the laws of the State of
Minnesota. Seller has the requisite corporate power and
authority to own, lease and operate its properties and
assets, including without limitation the Assets, and to
carry on its Business as is now being conducted.
3.2 Authority. Seller has full corporate
power and authority to execute and to deliver this
Agreement and all other agreements executed and delivered
or to be executed and delivered by Seller in connection
with the transactions contemplated hereby, including,
without limitation, the documents specified in Section 9
hereof to be executed and delivered by Seller. The
execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have
been duly and validly authorized by the Board of
Directors of Seller and approved by the vote of the
shareholders of Seller, and no other corporate
proceedings on the part of Seller and no approvals or
consents of any other persons are necessary to authorize
the execution and delivery of this Agreement and to
consummate the transactions contemplated hereby. This
Agreement has been duly and validly executed and
delivered by Seller and constitutes a valid and binding
agreement of Seller, enforceable against Seller in
accordance with its terms. Seller has the number of
shares of a single class of common stock ("Shares") set
forth on Schedule 3.2 hereto. Schedule 3.2 sets forth
the total number of Shares issued and outstanding and the
sole beneficial and record owners of all such Shares.
3.3 Financial Statements; Absence of Certain
Changes. Seller has heretofore delivered to Purchaser
the following financial statements for the period ending
October 31, 1995 (the "Financial Statements") set forth
on Schedule 3.3 attached hereto. The Financial
Statements present fairly the financial position of
Seller as of their respective dates. The Seller's
outside accountant has performed an overview of the
Financial Statements, and, shall represent in writing to
Purchaser, in a form satisfactory to Purchaser, that such
accountant is unaware of any material circumstance or
event resulting in the Financial Statements not fairly
presenting the financial condition of Seller, and that
the accountant is not aware of any material event that
would adversely affect the financial condition of Seller
as so presented. Since October 31, 1995, Seller has not:
(i) materially increased the compensation of any employee
or altered its policies with respect to employee
compensation; (ii) sold, leased or otherwise transferred
any Assets (except in the ordinary course of business),
or (iii) incurred any debts or liabilities (except in the
ordinary course of business).
3.4 Assumed Liabilities. Seller has delivered
to Purchaser a true, complete, and correct copy of each
written instrument or document governing the Assumed
Liabilities. All of the Assumed Liabilities of Seller
are set forth in Schedule 1.3, attached hereto, none of
which have been amended or modified except as disclosed
in Schedule 1.3. Seller is not in default under any of
the Assumed Liabilities and is not aware of any actions
or omissions which might result in such default upon
notice or the passage of time, or both.
3.5 No Default; Consents and Approvals.
Neither the execution and delivery of this Agreement, nor
the consummation of any of the transactions contemplated
herein will (i) violate any provision of the Articles of
Incorporation or Bylaws of Seller (true and complete
copies of which have heretofore been delivered to
Purchaser by Seller); (ii) violate, conflict with or
result in the breach or termination of, or otherwise give
any other contracting party the right to terminate, or
constitute a default (by way of substitution, novation or
otherwise) under the terms of, any agreement, lease,
indenture or instrument to which the Seller is a party,
including, without limitation, the Assumed Liabilities,
or by which it or any of the Assets may be bound; (iii)
result in the creation of any lien, charge or encumbrance
upon the Assets; (iv) violate any judgment, order,
injunction, decree or award against, or binding upon,
Seller, the Assets or Assumed Liabilities; or (v)
constitute a violation by Seller of any law or regulation
applicable to Seller, the Assets or the Assumed
Liabilities. All consents, releases or waivers from
third parties (including, without limitation,
governmental and regulatory authorities) which may be
necessary to prevent the transactions provided for herein
causing a breach, acceleration or default of the type
specified in this Section 3.5 have been obtained.
3.6 Intentionally Deleted.
3.7 Title to Assets. Seller has good and
marketable title to all Assets, whether real, personal or
mixed, all of which are free and clear of any
restrictions on or conditions to transfer or assignment
and free and clear of any mortgages, liens, security
interests, encumbrances, claims, charges or adverse
interests of any kind or character (collectively,
"Encumbrances") of any other person or entity. All work-
in-progress and Inventory has been fully paid for (except
for any Assumed Liabilities) and is not subject to any
conditional sales contract, consignment or other
Encumbrances whatsoever, nor does any third party have
any interest or claim therein.
3.8 Condition of Assets. Except for ordinary
wear and tear, to Seller's knowledge, all of the Fixed
Assets are in good operating condition and repair,
adequate for the uses to which they are being put in the
Business. All property and excise taxes for the Assets
have been fully paid for all tax years, except for any
installment not yet due and payable with respect to the
current tax year.
3.9 Compliance With Laws. The conduct of the
Business by Seller, the condition and Seller's occupancy
of the Premises, and the condition and use of the Assets
have not violated any material applicable federal, state
and local statutes, laws and regulations, including
(without limitation) any material applicable laws and
regulations relating to building, zoning, environmental,
health and safety, employee safety and the employment of
labor (including those laws and regulations relating to
wages, workers' compensation, hours, collective
bargaining, non-discrimination in employment and the
withholding and payment of taxes and contributions).
Seller has not received any notice of any such violation.
3.10 Real Property. Schedule 3.10 to this
Agreement contains the common description of the
Premises. Seller has no knowledge that the zoning for
the Premises prohibits the existing improvements or
continuation of the Business being conducted on such
Premises. Seller has not commenced, nor has Seller
received notice of the commencement of, any proceeding
that would affect the present zoning classification of
such Premises. There are no unrecorded easements
(including prescriptive easements), subleases, licenses
or other rights of occupancy existing with respect to the
Premises granted by Seller.
3.11 Hazardous Substances. Except as set
forth in Schedule 3.11 hereto, neither the Assets nor the
Premises contain, to the best knowledge of Seller after
diligent review and inquiry, any Hazardous Substances (as
defined below), whether located upon or beneath Premises,
and no debris has been buried beneath the surface of the
Premises. Seller has not discharged, and has no
knowledge that any other person has discharged, any
Hazardous Substances on Premises. Seller is in
compliance with the terms and conditions of all statutes,
use ordinances and regulations, federal, state and local,
pertaining to the Assets and the sanitization or cleanup
of the Premises with respect to Hazardous Substances.
Seller has provided access to and copies of any data
and/or documents dealing with potentially Hazardous
Substances used at the Premises and any disposal
practices followed. Buyer shall have the right to make
inquiries of governmental agencies regarding such
matters, without liability for the outcome of such
discussions.
"Hazardous Substances" means any material or
substance that is (a) a "hazardous substance" pursuant to
Section 101 of the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. SECTION 9601(14),
Section 311 of the Federal Water Pollution Control Act,
33 U.S.C. SECTION 1321; (b) a "hazardous waste" pursuant to
Section 1004 or Section 1001 of the Resource Conservation
and Recovery Act, 42 U.S.C. SECTIONSECTION 6903, 6921; (c) a toxic
pollutant under Section 307(a)(1) of the Federal Water
Pollution Act, 33 U.S.C. SECTION 1317(a)(1); (d) a "hazardous
air pollutant" under Section 112 of the Clean Air Act, 42
U.S.C. SECTION 7412; (e) a "hazardous material" under the
Hazardous Materials Transportation Uniform Safety Act of
1990, 49 U.S.C. App. SECTION 1802(4); (f) toxic or hazardous
pursuant to regulations promulgated under the
aforementioned laws; or (g) a risk to the environment
that is a toxic or hazardous substance, material,
pollutant or waste under any other applicable federal,
state or local laws, ordinances or regulations.
3.12 Employee Agreements. Except as set forth
on Schedule 3.12, Seller is not a party to any collective
bargaining agreement or other similar labor agreements,
or any medical, life insurance, pension, retirement,
deferred compensation, profit sharing or other incentive
or fringe benefit plan, agreements or arrangements
providing for employee remuneration or benefits. Seller
represents and warrants that Xxxx Xxxxxxx is an employee-
at-will of Seller.
3.13 Customers. Seller has not received
notification and has no reason to believe that any of the
current customers or suppliers of the Business,
including, without limitation, the customers and
suppliers designated in Schedule 3.13 attached hereto,
will cease doing business, or will reduce the amount of
business such suppliers and customers currently conduct
with respect to the Business.
3.14 Bulk Sales Information. Seller has
complied, any and all steps have been taken and all
waiting periods have expired for compliance, with any and
all applicable bulk sales laws; and as a consequence
thereof, neither Seller nor Purchaser are liable to any
creditor of Seller with respect thereto.
3.15 Proprietary Rights. The Proprietary
Rights, including, without limitation, the Proprietary
Rights listed or described in Schedule 1.1.4 hereto, are
the sole and exclusive property of Seller. No licenses,
sublicenses, or other rights have been granted or entered
into by Seller with respect to the Proprietary Rights.
All of the Proprietary Rights, including without
limitation, the Proprietary Rights listed in Schedule
1.1.4, are current, unexpired and in good standing and
free and clear of all security interests, liens,
encumbrances, and other restrictions. Seller has not at
any time knowingly taken, or permitted to be taken, any
action, or permitted any use, nor is Seller aware of any
such action or use that would impair the validity or
enforceability of any of the Proprietary Rights, or
Purchaser's exclusive ownership thereof.
3.16 Litigation. There is no suit or action
(equitable, legal, administrative or otherwise),
proceeding or investigation of any kind pending (or to
the knowledge of Seller threatened) against Seller, or
which relates to the Assets or Assumed Liabilities, nor
is there any factual basis of which Seller is aware for
any such suit, action, proceeding or investigation
(including, without limitation, any relating to
environmental, health, safety or Hazardous Substances
matters) against Seller or which could affect the Assets,
the Assumed Liabilities or the Premises, or which could
affect the ability of Seller to carry out the
transactions contemplated hereunder in accordance with
the terms hereof.
3.17 Books and Records. The books and records
of Seller accurately reflect all material transactions
and correctly account for all material receipts,
disbursements and expenditures in connection with the
Assets and the Assumed Liabilities.
3.18 Certain Pre-Closing Representations and
Warranties of Seller.
3.18.1 Information. Seller has furnished
or caused to be furnished to Purchaser all data and
information concerning the Premises, the Assets, the
Assumed Liabilities, existing insurance policies, and all
manufacturer's warranties pertaining to the Assets that
have been requested by Purchaser.
3.18.2 Maintenance of Insurance. From
November 1, 1995 to the Closing, Seller has continued to
carry its existing insurance for the Premises and the
Assets.
3.18.3 Third Party Consents. Seller has
obtained and delivered to Purchaser the written consent
of any persons, to the extent the consent of such persons
is required, in order to validly convey good, marketable
and unencumbered title to the Assets to Purchaser.
3.18.4 Conduct of Business. From
November 1, 1995 through the Closing, Seller has carried
on the Business in substantially the same manner as
carried out prior to November 1, 1995, and did not
institute any unusual or novel methods of inventory
purchase, management, accounting or operation, or incur
or pay any liability or expense, that varied materially
from the ordinary course of business of Seller as of
November 1, 1995.
3.18.5 Employees. Seller agrees that
Purchaser shall have no obligation whatsoever to employ
any person employed by Seller with respect to the
Business. Notwithstanding the foregoing, Seller has used
its best efforts to keep available to Purchaser Seller's
employees to the extent that Purchaser advised Seller
that it desired to employ one or more of the persons
currently employed by Seller with respect to the
Business. Any such persons employed by Purchaser, if
any, will be treated and deemed as "new hires" by
Purchaser for all purposes. Seller agrees that Purchaser
shall have the right, but not the obligation, to employ
any one or more of Seller's employees, and between
November 1, 1995 and the Closing, Seller has not made any
change in compensation payable or which became or will
become payable to any employee (including severance or
vacation pay, and compensation payable pursuant to bonus
or pension plans or other employee plans or other
benefits to such employees).
3.18.6 Capitalization of Seller. From
November 1, 1995 until the Closing, Seller did not make
or pay any distribution or dividend to any shareholder,
issue any additional shares of its capital stock, or
issue or create any warrants, obligations, subscriptions,
options, convertible securities or other commitments
under which any additional shares of its capital stock
could be issued, nor did it agree to do any such acts.
3.18.7 Dispositions of Assets. From
November 1, 1995 until the Closing, Seller did not (a)
sell, assign, transfer, distribute or encumber any of the
Assets, or agree to do so (except for the use of raw
materials, work-in-progress and inventory in the regular
course of business), or (b) sell, transfer, assign, lease
or otherwise grant any right to any third party to lease
the Premises in any respect, nor agree to do so.
3.19 Full Disclosure; Knowledge. None of the
representations and warranties made by Seller in this
Agreement, or in any certificate or document furnished or
to be furnished by Seller, or any officer thereof, or any
of them, or on their behalf, contains or will contain any
untrue statement of a material fact, or omit or state a
material fact necessary to make the statements made, in
light of the circumstances under which they were made,
not misleading. All of Seller's representations and
warranties contained in Section 3.8 through 3.18 are
being made hereunder solely to the best knowledge of
Seller, after due inquiry and review of its officers,
directors and employees.
4. Representations and Warranties of Purchaser.
Purchaser represents and warrants to Seller as
follows:
4.1 Corporate Existence and Organization.
Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State
of Delaware and has all requisite power and authority to
own, lease and otherwise operate its properties and
assets.
4.2 Authority. Purchaser has full corporate
power and authority to execute and to deliver this
Agreement and all other agreements executed and delivered
or to be executed and delivered by Purchaser in
connection with the transactions contemplated hereby,
including, without limitation, the documents specified in
Section 9 hereof to be executed and delivered by
Purchaser. The execution and delivery of this Agreement
and the consummation of the transactions contemplated
hereby have been duly and validly authorized by the Board
of Directors of Purchaser, and no other corporate
proceedings on the part of Purchaser and no approvals or
consents of any other persons are necessary to authorize
the execution and delivery of this Agreement or to
consummate the transactions contemplated hereby. This
Agreement has been duly and validly executed and
delivered by Purchaser and constitutes a valid and
binding agreement of Purchaser, enforceable against
Purchaser in accordance with its terms.
5. Certain Seller Obligations.
5.1 Manufacturer's Warranties. Seller
covenants and warrants that it shall use its best efforts
to obtain a transfer to Purchaser of all manufacturer's
warranties relating to the Assets.
5.2 Sales Tax. Seller shall be responsible
for and bear the cost of all Minnesota sales, excise,
transfer and use taxes arising by virtue of the purchase
and sale of Assets hereunder.
5.3 Payment of Creditors. Seller shall pay
all amounts owing its creditors when due.
5.4 Further Assurances. Seller represents,
warrants and covenants that, from and after the Closing
Date, Seller shall furnish any additional information,
execute and deliver such documents and do all such things
as may be reasonably necessary or appropriate to carry
out the intent and accomplish the purposes of this
Agreement, or otherwise consummate the transactions
contemplated by this Agreement according to its terms,
and will do all things necessary or appropriate to effect
compliance with the requirement of any laws of the United
States or any state arising from the transactions
contemplated hereby.
6. Purchaser's Conditions to Closing.
The obligation of Purchaser to purchase the
Assets and consummate the related transactions provided
for under this Agreement are subject to the fulfillment
or waiver by Purchaser in writing, at or prior to
Closing, of each and all of the conditions precedent
listed below to be delivered by any Seller at Closing.
6.1 Execution and Delivery of Documents.
Seller shall have executed and delivered to Purchaser all
of the documents and agreements specified in Section 9
below, to be delivered by Seller at Closing.
6.2 Performance. Seller shall have performed,
satisfied and complied with all covenants, agreements and
conditions required by this Agreement to be performed or
complied with by Seller on or before the Closing Date.
6.3 Consents. All necessary agreements and
consents of any third parties to the consummation of the
transactions contemplated by this Agreement shall have
been obtained by Seller and delivered to Purchaser.
6.4 Proceedings. All corporate and other
proceedings in connection with the transactions
contemplated hereby and all documents and instruments
incident to such transactions shall be in form and
substance satisfactory to Purchaser and its counsel, and
Purchaser shall have received counterpart originals or
certified copies of such documents as it may reasonably
request.
6.5 Bulk Transfer. Seller shall have complied
with all applicable transferor requirements of all
applicable bulk sales laws.
6.6 No Material Adverse Change. During the
period from the date of balance sheet included in the
Financial Statements to the Closing Date, none of the
Assets shall have sustained any material loss or damage
(whether or not such damage or loss is insured) nor shall
there have been any material adverse change in the
financial condition or prospects of the Seller.
6.7 Accuracy of Representations and
Warranties. All warranties and representations by Seller
in this Agreement, or in any schedule, exhibit, document
or certificate furnished to Purchaser in connection with
the transactions contemplated by this Agreement, shall be
true in all material respects on and as of the Closing
Date.
7. Other Covenants; Post-Closing Obligations.
7.1 Additional Agreements with Seller.
7.1.1 Non-Competition Agreement. Seller,
and Xxxx Xxxxxxx and Xxxxx Xxxxxxxxx, shall enter into a
covenant not to compete substantially in the form set
forth at Schedule 7.1.1 hereto (the "Non-Competition
Agreement") and providing that during the period
specified in the Non-Competition Agreement neither Seller
nor such parties shall, directly or indirectly, within
any areas identified in the Non-Competition Agreement,
compete in the business of the manufacturing, marketing,
or sale of products or goods sold by, or substantially
similar in style to the products or goods sold by, Seller
as of the Closing Date, all as more fully set forth in
the Non-Competition Agreement.
7.2 Use of Name. On the Closing Date, Seller
shall take all actions necessary to cause its name to be
changed to a name which bears no resemblance to its
current name, including, without limitation, deletion of
the words "Mag-Head" from its name, and shall file with
the Office of the Minnesota Secretary of State a
certificate of amendment to Seller's Articles of
Incorporation reflecting such change of name. Neither
Seller nor Shareholder shall use the name "Mag-Head" or
"MEC," in connection with any business operated by Seller
or Shareholder after the Closing without the prior
written consent of Purchaser. Seller shall cooperate
with any application by Purchaser to use the name "Mag-
Head" or "MEC," or any similar name, in connection with
Purchaser's operation of the Business acquired by
Purchaser.
7.3 Receipt of Mail. From and after the
Closing Date, Purchaser shall have the sole and exclusive
right to receipt of all mail addressed to Seller.
Purchaser shall forward to Seller any such mail not
applicable to the Assets or the Business, within four (4)
business days of Purchaser's receipt thereof.
7.4 Certain Discounts. Schedule 7.4 hereto
contains a list of Seller's suppliers who have agreed to
provide price or other discounts or concessions to Seller
with respect to merchandise or services purchased from
such suppliers and a description of each such
arrangement, including the amounts involved and the terms
thereof. Seller and Purchaser agree that the benefit of
all such discounts and concessions shall inure to the
benefit of Purchaser and the parties hereto agree to take
such steps as are necessary to effect such agreement.
7.5 Further Assurances. Purchaser and Seller
each represents, warrants and covenants to the other that
if at any time after the execution of this Agreement, the
other party shall reasonably consider or be advised that
any further assignments or assurances in law are
necessary or desirable to carry out the intent and
accomplish the purposes of this Agreement according to
its terms, such party shall execute and make all such
proper assignments and assurances and do all things
necessary or appropriate to carry out the intent and
accomplish the purposes of this Agreement and to
consummate the transactions contemplated by this
Agreement according to its terms.
8. Seller's Conditions to Closing. The
obligations of Seller to sell the Assets and consummate
the related transactions provided for under this
Agreement are subject to the fulfillment or waiver by
Seller in writing, at or prior to Closing, of each and
all of the conditions precedent listed below.
8.1 Execution and Delivery of Documents;
Performance. Purchaser shall have executed and delivered
to Seller all of the documents and agreements specified
in Section 9 below to be executed and delivered by
Purchaser, and performed and complied with all covenants
and agreements of Purchaser required to be performed or
complied with prior to Closing.
8.2 Accuracy of Representations and
Warranties. All representations and warranties of
Purchaser contained in this Agreement shall be true on
and as of the Closing Date as though such representations
and warranties were made on and as of that date.
9. Closing.
9.1 Time of Closing. The closing of the
transactions contemplated herein (the "Closing") shall be
at 10:00 A.M., on February 7, 1996, or at such other time
as the parties hereto shall mutually agree to (the
"Closing Date"). This Agreement and all agreements and
documents to be executed and delivered in connection with
the Closing may be executed in counterparts, each of
which shall be an original of such respective agreement
and document, but all counterparts of which shall
together constitute one instrument thereof, respectively.
Delivery by a party of an executed counterpart by
facsimile may be relied on by the other party as an
original, and any party delivering a counterpart by
facsimile shall promptly deliver an executed original to
the other party. The failure by a party to do so shall
not invalidate any prior facsimile delivery of such
counterpart by such party. The parties mutually
acknowledge and agree for the purposes of this Agreement
that time is of the essence. If the Closing does not
occur on or before the Closing Date by reason of any
default of Seller under this Agreement, in addition to,
and not by way of limitation of any other right or remedy
of Purchaser, Purchaser shall be relieved of its
obligation to consummate the Closing.
9.2 Delivery of Cash and Documents. On the
Closing Date, the parties shall deliver to each other the
following respective documents:
9.2.1 Two original, fully executed copies
of a Warranty Xxxx of Sale in the form of Schedule 9.2.1
hereto, signed by Seller and Purchaser, together with
such other instruments and documents as Purchaser shall
reasonably require to vest Purchaser with marketable
title to the Assets, free and clear of all liens,
charges, and encumbrances.
9.2.2 Two original, fully executed copies
of an Assignment of Intangibles in the form of Schedule
9.2.2 hereto, signed by Seller and Purchaser.
9.2.3 Two original, fully executed copies
of an Assignment and Assumption of Contracts in the form
of Schedule 9.2.3 hereto, signed by Seller and Purchaser.
9.2.4 Intentionally deleted.
9.2.5 Two originals of an affidavit,
signed by Seller, to the effect that Seller is not a
foreign corporation, foreign partnership, foreign trust
or foreign estate within the meaning of the Internal
Revenue Code of 1986, as amended, and the regulations
promulgated thereunder, substantially in the form of
Schedule 9.2.5 hereto.
9.2.6 The Purchase Price, to be paid by
Purchaser in accordance with Section 2.2, subject to
applicable adjustments and credits hereunder.
9.2.7 Two original, executed certificates
in the form of Schedule 9.2.7(a) and 9.2.7(b), signed by
officers of the Seller and Purchaser, respectively.
9.2.8 Two original, fully executed copies
of the Non-Competition Agreement in the form of Schedule
7.1.1 hereto, signed by Seller and Purchaser.
9.2.9 An original opinion of legal
counsel for Seller, in the form set forth in Schedule
9.2.9 hereto, to be delivered by Seller.
9.2.10 Two original, executed copies of
an Assignment of the Lease (with executed Consent of
Landlord), in the form of Schedule 1.3.1 hereto, and
signed by Seller, the landlord under the Lease and
Purchaser.
9.3 Actions at Closing. All requirements with
respect to Closing shall be considered as having taken
place simultaneously, and no delivery shall be considered
as having been made until all deliveries and closing
transactions have been accomplished.
9.4 Allocation. Except as otherwise provided
in Sections 10 and 11, the parties' responsibility for
personal and real property taxes, utilities and other
similar charges relating to the Assets, shall be
allocated between the parties with Seller paying all such
expenses applicable to ownership of the Assets prior to
the Closing Date and Purchaser paying all such expenses
applicable to ownership of the Assets thereafter.
10. Indemnity.
10.1 Seller's Indemnity. Seller hereby,
agrees to indemnify, defend and hold harmless Purchaser
against and in respect of any and all claims, demands,
losses, costs, expenses, obligations, liabilities,
damages, recoveries and deficiencies, including, without
limitation, interest, penalties and reasonable attorneys'
fees and court costs (collectively "Claim(s)"), that
Purchaser shall incur or suffer, which arise, result
from, or relate to (i) any breach of, or failure by
Seller to perform, any of its representations,
warranties, covenants or agreements in this Agreement or
in any schedule, certificate, document, exhibit or other
instrument furnished or to be furnished by Seller under
this Agreement, and (ii) except as otherwise expressly
assumed by Purchaser as an Assumed Liability hereunder
(and in such case solely to the extent of such
assumption), any actual or alleged tort, breach of
contract, wrongdoing, cause of action or Claim arising in
connection with, incurred with respect to or relating to
(a) the conduct of the Business of Seller, or (b) the
Premises or the Assets (and any Hazardous Substances with
respect any of the foregoing) prior to the Closing Date.
10.2 Purchaser's Indemnity. Purchaser hereby
agrees to indemnify, defend and hold harmless Seller,
against and in respect of any and all Claims that Seller
shall incur or suffer, which arise, result from or relate
to (i) any breach of, or failure by Purchaser to perform,
any of its representations, warranties, covenants or
agreements in this Agreement or in any schedule,
certificate, document, exhibit or other instrument
furnished or to be furnished by Purchaser under this
Agreement, and (ii) any actual or alleged tort, breach of
contract, wrongdoing, cause of action or Claim (a)
incurred or relating to the conduct by Purchaser after
the Closing Date of its business (and any Hazardous
Substances with respect thereto) on the Premises, or (b)
incurred by Purchaser following the Closing Date with
respect to the Assets or the Assumed Liabilities.
11. Taxes. Any and all Minnesota sales, excise,
transfer and use taxes applicable to the conveyance and
transfer to Purchaser of the Assets shall be borne and
paid for solely by Seller. Seller represents and
warrants that all personal property taxes arising prior
to the Closing with regard to the Assets have been timely
and fully paid. Purchaser shall have no responsibility
or liability for any income, excise, property, business,
occupation, withholding or similar tax, or for taxes of
any other kind or type on the Business or Seller's
operations and activities at the Premises, related to any
period prior to the Closing Date, and Seller shall
indemnify Purchaser under Section 10.1 with respect to
any such liability.
12. Miscellaneous Provisions.
12.1 Expenses. Except as otherwise provided
in this Agreement, each party hereto shall pay its own
expenses (including, without limitation, legal and
accounting fees) incident to the origination, negotiation
and execution of this Agreement and the consummation of
the transactions contemplated hereby, regardless of
whether such transactions are consummated.
12.2 Schedules and Exhibits. Each of the
schedules and exhibits attached hereto are incorporated
herein by reference and made a part hereof for all
purposes.
12.3 Amendments or Waivers. Except as
otherwise specifically stated herein, any provision of
this Agreement may be amended by, and only by, a written
agreement executed by Purchaser, on the one hand, and
Seller, on the other. Either party may extend the time
for or waive the performance of any obligation of the
other party, waive any inaccuracies in the
representations or warranties of the other party, waive
fulfillment of any conditions or contingencies to such
party's obligations to consummate the transactions
provided for hereunder, or waive compliance by the other
party with any of the terms and conditions contained in
this Agreement; provided that, each and every such
extension or waiver shall be in writing.
12.4 Further Assurances. From and after the
Closing Date, the parties shall, on request, cooperate
with one another by furnishing any additional
information, executing and delivering any additional
documents and instruments, and taking any and all other
actions as may reasonably be required by the parties or
their respective counsel to consummate or otherwise
implement the transactions provided for in this
Agreement.
12.5 Successors and Assigns. This Agreement
shall apply to, and inure to the benefit of, and be
binding upon and enforceable against the parties hereto
and their respective successors and permitted assigns.
12.6 Governing Law; Venue. This Agreement,
and the ancillary agreements and documents executed and
delivered in connection herewith, and the rights and
obligations of the parties hereto and thereunder shall be
governed by and construed in accordance with the laws of
the State of Minnesota.
12.7 Notices. Any notice, demand, approval,
consent, request, waiver or other communication which may
be given or which is required to be given pursuant to
this Agreement shall be in writing and shall be deemed
given on the earlier of the day actually received or on
the close of business on the third business day following
the date deposited in the United States mail, postage
pre-paid, certified or registered, addressed to the party
at the address set forth after its respective name below,
or at such different address as such party shall have
theretofore advised the party of in writing, with copies
sent to the persons indicated:
To Seller: MHD Minnesota, Inc.
00000 00xx Xxxxx Xxxxx
Xxxxx Xxxxx, Xxxxxxxxx 00000
Attn: Xx. Xxxxx Xxxxxxxxx
To Purchaser: Ahead Technology Acquisition
Corporation
c/o 0000 Xxxxxxx Xxxxx Xxxxx
Xxxxx Xxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx Xxxxxxx
or to such other address as such party shall have
specified by notice in writing to the other.
12.8 Invalid Provisions. If any provision
hereof shall be held to be illegal, invalid or
unenforceable under present or future laws effective
during the term hereof, such provision shall be fully
severable and this Agreement shall be construed and
enforced as if such illegal, invalid or unenforceable
provision had never comprised a part hereof, with the
remaining provisions hereof remaining in full force and
effect and unaffected by the illegal, invalid or
unenforceable provision or by its severance herefrom. In
lieu of such illegal, invalid or unenforceable provision,
there shall be added automatically as a part hereof a
provision as similar in terms as the illegal, invalid or
unenforceable provision as may be possible and, at the
same time, be legal, valid and enforceable.
12.9 Entirety of Agreement. This Agreement
(including exhibits, schedules and agreements referenced
herein) and any other agreements and instruments
delivered at the Closing (or after the Closing pursuant
hereto) contain the entire Agreement between the parties.
No representations, inducements, promises or agreements,
whether oral or otherwise, which are not embodied herein
or therein shall be of any force or effect.
12.10 No Commission or Finder's Fee. Seller
and Purchaser each represent and warrant that no
brokerage, finder's or similar fee or commission has been
incurred by them or it in connection with the
transactions provided for in this Agreement. Seller, on
the one hand, and Purchaser, on the other, hereby
indemnify and hold harmless the other party under Section
10 hereof from any brokerage, finder's or similar fee or
commission incurred by such identifying party in
connection with the transactions contemplated by this
Agreement.
12.11 Joint and Several Liabilities.
Intentionally deleted.
12.12 Counterparts; Effectiveness. This
Agreement may be executed in counterparts, each of which
shall be deemed an original for all purposes and all of
which shall be deemed, collectively, one Agreement. This
Agreement shall become effective when executed and
delivered by all parties hereto.
12.13 Confidentiality. Seller and Seller's
officers, directors and other representatives shall hold
in strict confidence the terms and condition of this
Agreement, except to the extent required to be provided
to any tax or other governmental authority. Seller
waives any cause of action, right or claim arising out of
the access of Purchaser or its representatives to any
trade secrets or other confidential information of
Purchaser from the date of this Agreement until the
Closing Date, except for the intentional, competitive
misuse by Purchaser of such trade secrets or other
confidential business information if the Closing does not
take place.
12.14 Parties In Interest. Nothing in this
Agreement, whether express or implied, is intended to
confer any rights or remedies under or by reason of this
Agreement on any persons or entities other than the
parties hereto, and their respective successors and
assigns, nor is anything in this Agreement intended to
relieve or discharge the liability or obligation of any
third persons to any party to this Agreement or give any
third persons any right of subrogation or action over
against any party to this Agreement.
12.15 Attorneys' Fees. If any legal action or
other proceeding is brought for the enforcement of this
Agreement, or because of an alleged dispute, breach,
default or misrepresentation in connection with any of
the provisions of this Agreement, the successful or
prevailing party or parties shall be entitled to recover
reasonable attorneys' fees and other costs incurred in
that action or proceeding, in addition to any other
relief to which it or they may be entitled.
12.16 Nature and Survival of Representations
and Warranties. Representations and warranties made by
the parties to this Agreement shall be deemed to be
continuing and shall survive the Closing.
12.17 Purchaser's Right of Specific
Performance. The Assets to be transferred under this
Agreement cannot be readily purchased or sold, as the
case may be, in the open market and for that reason,
among others, it is agreed that Purchaser will be
irreparably damaged by a failure of consummation of the
transactions contemplated by this Agreement resulting
from a breach by Seller of its obligations hereunder.
Accordingly, in the event of any default by Seller under
this Agreement, the rights of Purchaser shall be
enforceable by decree of specific performance. Such
remedy, however, shall be cumulative and not exclusive,
and shall be in addition to any other remedies that
Purchaser may have.
12.18 Counsel. Each party hereto acknowledges
and agrees that such party has been represented by
counsel of his or its choice in connection with execution
and delivery of this Agreement and this Agreement has
been reviewed by such counsel to such party's
satisfaction.
IN WITNESS WHEREOF, this Agreement has been
signed by duly authorized representatives on behalf of
each of the parties hereto on the date first written
above.
MAG-HEAD ENGINEERING COMPANY,
INC.
By: /s/ Xxxx X. Xxxxxxx
Xxxx S. Xxxxxxx, President
By: /s/ Xxxxx Xxxxxxxxx
Xxxxx Xxxxxxxxx, Secretary
AHEAD TECHNOLOGY ACQUISITION
CORPORATION
By: /s/ Xxxxx Xxxxxxx
Title: V.P. Finance
Schedule 1.1.1
Description of Fixed Assets
See Attached.
MC Software, Inc.
MAG-HEAD ENGINEERING COMPANY, INC. 11/30/95
GREP11 Account Details Report Page 1
All Departments
All Periods
Account Dept Description
Date Per PR JB Reference Amount Balance
1500 00 LEASEHOLD IMPROVEMENTS
02/28/95 01 511 GL Balance Forward Year 489.78 489.78
1550 00 MACHINERY & EQUIPMENT
02/28/95 01 511 GL Balance Forward Year 269400.04 269400.04
RECORD XXXXXXXX
06/30/95 04 550 GL IND PURCS 397.70 269797.74
08/31/95 06 562 AP A/P Capital 3 1570.00 271367.74
1570 00 OFFICE EQUIPMENT
02/28/95 01 511 GL Balance Forward Year 5874.36 5874.36
05/31/95 03 529 AP A/P 4 Office Eq 1795.87 7670.23
08/31/95 06 562 AP A/P 4 Office Eq 716.26 8386.49
MEC ENGINEERING, INC.
FIXED ASSETS - BOOK
METHOD/ A/D A/D
DATE DESCRIPTION LIFE COST 2/28/95 EXPENSE 2/28/96
LEASEHOLD IMPROVEMENTS:
9/18/86 BUILDING SIGN SL 7YR 244.00 244.00 244.00
0/0/00 X.X. XX 0XX 245.78 245.78 ___ 245.78
GRAINGER
TOTAL 489.78 489.78 0.00 489.78
MACHINERY & EQUIPMENT:
1986 Various SL 7YR 43,951.22 43,951.22 43,951.22
1987 Various SL 7YR 81,208.97 81,208.97 81,208.97
1988 Various SL 7YR 45,168.67 41,942.40 3,226.27 45,168.67
1989 Various SL 7YR 28,886.10 22,696.22 4,126.59 26,822.81
2/90 Equipment SL 7YR 886.26 633.04 126.61 759.65
4/90 Finishing SL 7YR 10,000.00 7,023.81 1,428.57 8,452.38
Machines(2)
0/00 Xxxxxxx-X- XX 0XX 1,066.00 748.74 152.29 901.02
Talk
5/90 X-Talk SL 7YR 275.00 189.88 39.29 229.17
Fixture
5/90 Microscope SL 7YR 848.00 585.52 121.14 706.67
5/90 MEC Lapping SL 7YR 2,400.00 1,657.14 342.86 2,000.00
Blocks
0/00 XXXXXXX Xxxxx XX 0XX 700.00 475.00 100.00 575.00
8/90 Impedence SL 7YR 755.53 494.69 107.93 602.63
Xxxxxx
00/00 0-Xxxxxxxxx XX 0XX 5,207.00 3,285.37 743.86 4,029.23
Machines
10/90 Grinding SL 7YR 565.32 356.69 80.76 437.45
Xxxxx Xxx
00/00 Xxxx XX 0XX 330.00 208.21 47.14 255.36
Xxxxxxxxx
0/00 Xxxxx XX 0XX 5,614.42 3,074.56 802.06 3,876.62
Council
Improvement
(5-90)
12/90 A/R SL 7YR 695.00 421.96 99.29 521.25
Software
0/00 Xxxx XX 0XX 1,010.00 601.18 144.29 745.47
Voltage
Power
Supply
3/91 12- SL 7YR 2,400.00 1,371.43 342.86 1,714.29
Position
Finishing
Holders
(2)
0/00 Xxxxx Xxx- XX 0XX 447.20 255.54 63.89 319.43
Wrap
Shield
3/91 Cabinet SL 7YR 280.00 153.33 40.00 193.33
4/91 Casing SL 7YR 728.00 398.67 104.00 502.67
Shim Die
7/91 Scopes & SL 7YR 1,524.89 762.45 217.84 980.29
Stations
8/91 Laminator SL 7YR 1,700.00 870.24 242.86 1,113.10
Mold
8/91 Bobbin SL 7YR 650.00 332.74 92.86 425.60
Mold
9/91 Rebuilt SL 7YR 470.20 235.10 67.17 302.27
Core
Holder
Insert
9/91 Temporary SL 7YR 1,100.00 550.00 157.14 707.14
Case Die
10/91 Heat Treat SL 7YR 3,131.66 1,528.55 447.38 1,975.93
Furnace
10/91 Various SL 7YR 1,715.00 837.08 245.00 1,082.08
Electronic
Equipment
10/91 Lapping SL 7YR 250.00 122.02 35.71 157.74
Machine
(Modified)
00/00 Xxxxxx XX 0XX 650.03 309.54 92.86 402.40
Phone
System
11/91 Drafting SL 7YR 350.00 166.67 50.00 216.67
Table
11/91 Precision SL 7YR 262.38 124.94 37.48 162.43
Oven
1/92 Four SL 7YR 3,200.00 1,447.62 457.14 1,904.76
Cavity
Xxxxx Mode
1/92 Equipment SL 7YR 329.18 148.91 47.03 195.94
2/92 Equipment SL 7YR 1,395.00 614.46 199.29 813.74
3/92 Window Die SL 7YR 860.00 368.57 122.86 491.43
(SCI)
3/92 Permanent SL 7YR 4,800.00 2,057.14 685.71 2,742.86
Tooling
Case
(SCI)
3/92 Assembly SL 7YR 490.00 210.00 70.00 280.00
Fixtures
(SCI)
3/92 Finishing SL 7YR 580.00 248.57 82.86 331.43
Fixture
(SCI)
3/92 Positioning SL 7YR 596.45 255.62 85.21 340.83
Fixtures
for
Write &
Read
(SCI)
0/00 Xxxxxxx XX 0XX 350.00 150.00 50.00 200.00
Xxxxx
Flash
Taping
Fixture
(SCI)
4/92 4 Cavity SL 7YR 250.00 104.17 35.71 139.88
Cable
Potting
Mold
4/92 Ganged SL 7YR 1,975.47 823.11 282.21 1,105.32
Arbor Saws
7/92 4 Position SL 7YR 600.00 228.57 85.71 314.29
Form
Grinding
Fixture (7
Track)
8/92 Slotting & SL 7YR 490.00 180.83 70.00 250.83
Drilling
Fixtures &
Gang Saws
9/92 Equipment SL 7YR 1,010.00 360.71 144.29 505.00
0/00 Xxxxxxxxxx XX 0XX 393.81 140.65 56.26 196.91
or
9/92 Equipment SL 7YR 290.00 103.57 41.43 145.00
10/92 Equipment SL 7YR 405.00 139.82 57.86 197.68
11/92 Punch SL 7YR 927.03 309.01 132.43 441.44
Press
11/92 Large SL 7YR 1,000.00 333.33 142.86 476.19
Winder
11/92 Small SL 7YR 400.00 133.33 57.14 190.48
Winder
11/92 Mill SL 7YR 250.00 83.33 35.71 119.05
12/92 Software SL 7YR 1,711.00 549.96 244.43 794.39
1/93 Window Die SL 7YR 965.00 298.68 137.86 436.54
0/00 0 Xxxxxxx XX 0XX 905.25 107.77 129.32 237.09
Grind
Fixture
TOTAL 269,400.04 226,970.68 17,379.29 244,349.97
OFFICE EQUIPMENT:
1986 Various SL 7YR 376.30 376.30 376.30
1987 Various SL 7YR 744.65 744.65 744.65
1989 Various SL 7YR 2,381.16 1,870.91 340.17 2,211.08
8/90 G/L SL 7YR 695.00 438.51 99.29 537.80
Software
0/00 X/X XX 0XX 695.00 438.51 99.29 537.80
Software
8/90 Bookcase, SL 7YR 413.40 260.84 59.06 319.89
Computer
Stand,
Metal
Shelving,
Black
Cabinet
5/91 Office SL 7YR 196.10 107.39 28.01 135.40
Equipment
4/92 Computer SL 7YR 372.75 155.22 53.25 208.47
TOTAL 5,874.36 4,392.33 679.06 5,071.39
Schedule 1.1.3
Description of Orders and Agreements
1. Lease, dated September 12, 1990 (as amended by a
certain (i) Rider, dated September 12, 1990, (ii) Amendment to
Lease, dated November 19, 1990, and (iii) Agreement to Extend
Lease, dated January 14, 1994), between Lutheran Brotherhood, a
Minnesota corporation, and Mag-Head Engineering, Inc. (now known
as Mag-Head Engineering Company, Inc.), a Minnesota corporation,
by which the premises therein commonly described as 000-000
Xxxxxxxxxxx Xxxxxx Xxxxx, Xxxxxx Xxxxxx, Xxxxxxxxx are demised
for a term commencing on September 12, 1990 and ending on January
31, 1997, a copy of which has been provided by Seller to
Purchaser. Also, all lease deposits thereunder.
2. All Accounts Receivable Trade (including, without
limitation, those identified on attached pages hereto) of Seller.
3. All GPT - A/R (including, without limitation, those
identified on attached pages hereto) of Seller.
4. Copier lease with "Imaging Systems," provided to
Purchaser by Seller.
5. All customer sales/purchase orders (including,
without limitation, those identified on attached pages hereto) of
Seller.
MAG-HEAD ENGINEERING
CUSTOMER SHIPPING SCHEDULE
NOVEMBER 1995
MEC DUE DATE INV.
# CUSTOMER QTY. $ VALUE DATE SHIPPED QTY. $ VALUE #
1096 DOD 15 $1,480.50 10-25
1014 B.E. 25 875.00 10-30
1014 B.E. 50 1,750.00 10-30
1205 GEORGENS 43 2,401.55 00-00 00-00 153 $8,545.05 3756
1041 ITC 11-21 2 264.00 3759
1084 HALL 3 195.00 11-10
1003 LORAL 100 6,430.00 11-15
1014 FIDELIPA 35 1,292.20 11-15
C
1004 LORAL 100 6,430.00 11-15
1082 PR&E 11-21 5 675.00 3758
1076 B&D 10 3,600.00 11-17
1084 ITC 64 2,459.52 11-20
1206 GEORGENS 100 5,585.00 11-20
1043 FIDELIPA 20 691.00 11-20
C
1206 GEORGENS 100 5,585.00 11-27
1119 LOCKHEED 42 6,827.52 00-00 00-00 8 1,300.45 3757
9 CH 3M 2 3,624.44 11-30
$49,226.73 SHIPPED: $10,784.53
TO BE SHIPPED: $49,226.73
NOV TOTAL: $60,011.26
DECEMBER 1995
DUE
MEC # CUSTOMER QTY. $ VALUE DATE
1206 GEORGENS 100 $5,585.00 12-4
1014 B.E. 50 1,750.00 12-7
1206 GEORGENS 40 2,234.00 12-11
1014 FIDELIPAC 35 1,292.20 12-15
1003 LORAL 120 7,716.00 12-15
1004 LORAL 100 6,430.00 12-15
1076 B&D 10 3,600.00 12-15
1084 ITC 80 3,074.40 12-18
2 GAP XXXXXX 10 1,700.00 12-19
1043 FIDELIPAC 20 691.00 12-20
1096 DOD 200 19,740.00 12-24
TOOL PRECISION 1 815.00 12-27
REFURB PRECISION 2 600.00 12-27
1003 DOD 40 4,720.00 12-29
9 CH 3M 2 3,624.44 12-30
??1069 SYGNETRON 3 250.00 12-30
7
$63,822.04
JANUARY 1996
DUE
MEC # CUSTOMER QTY. $ VALUE DATE
1004 LORAL 150 $10,117.50 1-3
SPACER 3M 200 3,116.00 1-4
S
1035 B.E. 25 695.00 1-8
1072 B.E. 15 483.75 1-8
1014 FIDELIPAC 35 1,292.20 1-15
1076 B&D 10 3,600.00 1-19
1043 FIDELIPAC 20 691.00 1-20
1084 ITC 80 3,074.40 1-22
1096 DOD 200 19,740.00 1-24
9 CH 3M 2 3,624.44 1-30
1157 PRIMUS 10K 48,800.00 1-30
$95,234.29
FEBRUARY 1996
DUE
MEC # CUSTOMER QTY. $ VALUE DATE
1014 B.E. 50 $1,750.00 2-7
1004 LORAL 150 10,117.50 2-9
1003 LORAL 100 6,745.00 2-9
1076 B&D 10 3,600.00 2-16
1157 PRIMUS 5000 24,400.00 2-13
1084 ITC 80 3,074.40 2-26
9 CH 3M 2 3,624.44 2-29
1157 PRIMUS 5000 24,400.00 2-27
$77,711.34
MARCH 1996
DUE
MEC # CUSTOMER QTY. $ VALUE DATE
1003 LORAL 100 $6,745.00 3-15
1076 B&D 10 3,600.00 3-15
9 CH 3M 2 3,624.44 3-30
$13,969.44
APRIL 1996
DUE
MEC # CUSTOMER QTY. $ VALUE DATE
1003 LORAL 100 $6,745.00 4-12
1004 LORAL 100 6,745.00 4-16
1076 B&D 10 3,600.00 4-19
$17,090.00
MAY 1996
DUE
MEC # CUSTOMER QTY. $ VALUE DATE
1003 LORAL 100 $6,745.00 5-10
1076 B&D 10 3,600.00 5-17
$10,345.00
TOTAL BACKLOG 95-
96
$236,767.6
7
TOTAL BACKLOG:
$278,172.1
1
UNSCHEDULED:
DUE
MEC # CUSTOMER QTY. $ VALUE DATE
CASES MOS 3825 $5,163.75
1072 B.E. 170 5,482.50
1035 B.E. 325 9,035.00
1014 B.E. 400 14,000.00
$33,681.25
Schedule 1.1.4
Proprietary Rights
All proprietary rights, service marks, patents,
trademarks, copyrights, designs, brand names, trade
names, processes, know-how, symbols, inventions,
programs, trade secrets, logos and telephone numbers
related to or connected with the Business, including,
without limitation, the product catalogues used or
distributed by Seller in connection with the Business and
the names "MEC" and "Mag-Head Engineering Company," and
all derivations thereof, all lists of suppliers,
customers and prospects, all Federal and state
applications for protection or registration of any of the
foregoing and all intangibles appurtenant thereto.
Schedule 1.2
Excluded Assets
Prepaid insurance premiums and other prepaid
expenses (excluding lease deposits).
Schedule 1.3
Assumed Liabilities
1. Lease, dated September 12, 1990 (as amended by
a certain (i) Rider, dated September 12, 1990, (ii)
Amendment to Lease, dated November 19, 1990, and (iii)
Agreement to Extend Lease, dated January 14, 1994),
between Lutheran Brotherhood, a Minnesota corporation,
and Mag-Head Engineering, Inc. (now known as Mag-Head
Engineering Company, Inc.), a Minnesota corporation, by
which the premises therein commonly described as 000-000
Xxxxxxxxxxx Xxxxxx Xxxxx, Xxxxxx Xxxxxx, Xxxxxxxxx are
demised for a term commencing on September 12, 1990 and
ending on January 31, 1997, a copy of which has been
provided by Seller to Purchaser. Also, all lease
deposits thereunder.
2. Copier lease with "Imaging Systems," provided
to Purchaser by Seller.
3. All accounts payable identified on the attached
pages hereto (unless otherwise paid for by Seller prior
to the Closing) and all other unpaid accounts payable
(which shall not, in any circumstance include (i) costs
arising in connection with the consummation of the
transactions under this Agreement and (ii) payroll and
other employee expenses arising from Seller's termination
of employees) incurred in the ordinary course of business
of Seller from February 6, 1996 to the Closing.
MC Software, Inc. MAG-HEAD ENGINEERING COMPANY, INC. 10/31/95
PREP05 Accounts Payable - Aged Trial Balance Page 1
Aged on 10/31/95
ACCOUNT BALCURRENT DUE PAST DUE CREDIT 1-30 31-60 00-00 00-000 PRIOR
ABR001 Abrasive Systems, Inc. 000-000-0000
175.90 0.00 175.90 0.00 87.95 87.95 0.00 0.00 0.00
AEI001 AEI Electronics Inc. 000-000-0000
21.48 0.00 21.48 0.00 0.00 21.48 0.00 0.00 0.00
AMP001 AMP Incorporated 000-000-0000
48.99 0.00 48.99 0.00 48.99 0.00 0.00 0.00 0.00
BAC001 Bacon Industries 000-000-0000
202.10 0.00 202.10 0.00 202.10 0.00 0.00 0.00 0.00
XXX-XXXXX XXX XXXXX 000-000-0000
225.60 0.00 225.60 0.00 0.00 225.60 0.00 0.00 0.00
BRO001 Xxxxxxxx Xxxxxx Ind. 000-000-0000
104.42 0.00 104.42 0.00 104.42 0.00 0.00 0.00 0.00
BOS001 BT Office Products Intn'l 000-000-0000
30.98 0.00 30.98 0.00 30.98 0.00 0.00 0.00 0.00
CIMCO CIMCO 000-000-0000
360.05 0.00 360.05 0.00 0.00 360.05 0.00 0.00 0.00
COP001 Copy Duplicating Products 000-000-0000
115.02 0.00 115.02 0.00 115.02 0.00 0.00 0.00 0.00
DAC001 Dacon Manufacturing Co. 000-000-0000
15672.95 0.00 15672.95 0.00 14966.15 706.80 0.00 0.00 0.00
DEM001 Xxxxxxx Industries, Inc.
90.92 0.00 90.92 0.00 90.92 0.00 0.00 0.00 0.00
EAS001 Eastech Chemical Inc. 000-000-0000
50.11 0.00 50.11 0.00 50.11 0.00 0.00 0.00 0.00
EEM001 Eemus Manufacturing Corp. 000-000-0000
2019.39 0.00 2019.39 0.00 2019.39 0.00 0.00 0.00 0.00
ELE003 Electrical Insulations 000-000-0000
268.22 0.00 268.22 0.00 157.82 110.40 0.00 0.00 0.00
EIT ENHANCED TELEMANAGEMENT 342-2255
266.61 266.61 0.00 0.00 0.00 0.00 0.00 0.00 0.00
EXP001 Express Messenger 000-000-0000
28.05 0.00 28.05 0.00 28.05 0.00 0.00 0.00 0.00
FID001 Fidelity Products Co. 000-000-0000
37.97 0.00 37.97 0.00 37.97 0.00 0.00 0.00 0.00
AMERICAN FUNDS SERVICE CO
1353.06 0.00 1353.06 0.00 1353.06 0.00 0.00 0.00 0.00
GOLFSMITH GOLFSMITH 000-000-0000
194.55 0.00 194.55 0.00 89.35 105.20 0.00 0.00 0.00
GRA001 X.X. Xxxxxxxx, Inc. 000-000-0000
22.91 0.00 22.91 0.00 0.00 22.91 0.00 0.00 0.00
GRANT XXXXX XXXXXXXX 332-0001
425.00 425.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
GTE GTE DIRECTORIES 831-5553
16.20 16.20 0.00 0.00 0.00 0.00 0.00 0.00 0.00
HARDCOAT HARDCOAT, INC. 000-000-0000
70.00 0.00 70.00 0.00 70.00 0.00 0.00 0.00 0.00
HONEYWELL HONEYWELL EMPLOYEE'S CLUB
31.99 0.00 31.99 0.00 31.99 0.00 0.00 0.00 0.00
IND002 Industrial Plastics, Mpls 000-000-0000
445.20 0.00 445.20 0.00 445.20 0.00 0.00 0.00 0.00
INVEST INVEST CAST INC 788-6965
2295.11 0.00 2295.11 0.00 2295.11 0.00 0.00 0.00 0.00
KUI001 Xxxxxxx Hardware 000-000-0000
32.43 11.91 20.52 0.00 20.52 0.00 0.00 0.00 0.00
116.75 0.00 116.75 0.00 116.75 0.00 0.00 0.00 0.00
NEW001 New England Electric Wire 000-000-0000
486.10 0.00 486.10 0.00 486.10 0.00 0.00 0.00 0.00
NOR002 Northern Airgas, Inc. 000-000-0000
26.64 13.54 13.10 0.00 0.00 13.10 0.00 0.00 0.00
OMI001 Omicron Tool 000-000-0000
1685.30 130.00 1556.30 0.00 227.50 1327.80 0.00 0.00 0.00
PACKNET PACKNET LTD 000-000-0000
771.26 432.62 338.64 0.00 338.64 0.00 0.00 0.00 0.00
PATRYAN XXX XXXX GOLF PRODUCTS 922-6924
62.46 0.00 128.46 -66.00 62.46 0.00 0.00 0.00 66.00
PRECISION PRECISION REPAIR, INC 000-000-0000
269.25 0.00 269.25 0.00 269.25 0.00 0.00 0.00 0.00
TADSON TADSON INC 000-000-0000
336.00 0.00 336.00 0.00 336.00 0.00 0.00 0.00 0.00
XXX000 Xxxx Xxxx Xxxxxx Xx. 000-000-0000
42.66 25.06 17.60 0.00 0.00 17.60 0.00 0.00 0.00
UNI002 United Parcel Service 000-000-0000
188.36 0.00 188.36 0.00 188.36 0.00 0.00 0.00 0.00
US-WEST US WEST DIRECT 000-000-0000
38.80 0.00 38.80 0.00 38.80 0.00 0.00 0.00 0.00
VISA BANKCARD CENTER800-344-5696
254.83 0.00 254.83 0.00 254.83 0.00 0.00 0.00 0.00
WAR001 Warner Industrial Supply 000-000-0000
242.98 0.00 242.98 0.00 34.62 208.36 0.00 0.00 0.00
WIFFLER XXXX XXXXXXX
10.97 10.97 0.00 0.00 0.00 0.00 0.00 0.00 0.00
XXX000 X.X. Xxxx & Associates 000-000-0000
2078.02 0.00 2078.02 0.00 0.00 2078.02 0.00 0.00 0.00
31205.59 1331.91 29839.68 -66.00 24596.41 5275.27 0.00 0.00 66.00
MC Software, Inc. MAG-HEAD ENGINEERING COMPANY, INC. 10/31/95
PREP07 Accounts Payable Invoice Register Page 1
OPEN INVOICES
DISC.
INVOICE # TYPE P/ORDER DATE DUE DATE AMOUNT BALANCE DIS DATE AMOUNT TOTAL PAY
ABR001 Abrasive Systems, Inc.
0018867 INVOICE 5048 09/11/95 10/11/95 87.95 87.95 0.00 87.95
0020318 INVOICE 5048 10/09/95 11/08/95 87.95 87.95 0.00 87.95
________ ________ _______ _______
175.90 175.90 0.00 175.90
AEI001 AEI Electronics Inc.
094008-0 INVOICE 5078 09/26/95 10/26/95 21.48 21.48 0.00 21.48
________ ________ _______ _______
21.48 21.48 0.00 21.48
AMP001 AMP Incorporated
F1450373 INVOICE 10/01/95 10/31/95 48.99 48.99 0.00 48.99
________ ________ _______ ________
48.99 48.99 0.00 48.99
BAC001 Bacon Industries
0076730 INVOICE 5057 10/19/95 11/18/95 202.10 202.10 0.00 202.10
________ ________ _______ ________
202.10 202.10 0.00 202.10
XXX-XXXXX XXX XXXXX
COMM-PAY INVOICE 09/29/95 09/29/95 225.60 225.60 0.00 225.60
________ ________ _______ ________
225.60 225.60 0.00 225.60
BRO001 Xxxxxxxx Xxxxxx Ind.
9001049873 INVOICE 10/01/95 10/31/95 104.42 104.42 0.00 104.42
________ ________ _______ ________
104.42 104.42 0.00 104.42
001 BT OFFICE PRODUCTS INTN'L
2948530 INVOICE 5101 10/24/95 11/23/95 30.98 30.98 0.00 30.98
________ ________ _______ ________
30.98 30.98 0.00 30.98
CIMCO CIMCO
0044896 INVOICE 5034 09/26/95 10/26/95 350.05 350.05 0.00 350.05
________ ________ _______ ________
350.05 350.05 0.00 350.05
COP001 Copy Duplicating Products
2207660 INVOICE 10/01/95 10/31/95 115.02 115.02 0.00 115.02
________ ________ _______ ________
115.02 115.02 0.00 115.02
DAC001 Dacon Manufacturing Co.
0031673 INVOICE 5053 09/21/95 10/21/95 706.80 706.80 0.00 706.80
0031720 INVOICE 5000 10/01/95 10/31/95 3075.60 3075.60 0.00 3075.60
0031721 INVOICE 4729 10/01/95 10/31/95 3510.00 3510.00 0.00 3510.00
0031746 INVOICE 5056 10/06/95 11/05/95 1728.23 1728.23 0.00 1728.23
0031816 INVOICE 4764 10/20/95 11/19/95 485.40 485.40 0.00 485.40
0031817 INVOICE 4764 10/20/95 11/19/95 510.30 510.30 0.00 510.30
0031855 INVOICE 4729 10/27/95 11/26/95 1029.60 1029.60 0.00 1029.60
0031856 INVOICE 4729 10/27/95 11/26/95 1006.20 1006.20 0.00 1006.20
0031857 INVOICE 5000 10/27/95 11/26/95 1782.45 1782.45 0.00 1782.45
0031858 INVOICE 5000 10/27/95 11/26/95 1838.37 1838.37 0.00 1838.37
________ ________ _______ ________
15672.95 15672.95 0.00 15672.95
IBM001 Xxxxxxx Industries, Inc.
0085582 INVOICE 5082 10/01/95 10/31/95 90.92 90.92 0.00 90.92
________ ________ _______ ________
90.92 90.92 0.00 90.92
EAS001 Eastech Chemical Inc.
0086450 INVOICE 5071 10/24/95 11/23/95 50.11 50.11 0.00 50.11
________ ________ _______ ________
50.11 50.11 0.00 50.11
EEM001 Eemus Manufacturing Corp.
I-94582 INVOICE 5001 10/02/95 11/01/95 2019.39 2019.39 0.00 2019.39
________ ________ _______ ________
2019.39 2019.39 0.00 2019.39
ELE008 Electrical Insultations
6598905 INVOICE 5079 09/26/95 10/26/95 110.40 110.40 0.00 110.40
6638755 INVOICE 5097 10/26/95 11/25/95 157.82 157.82 0.00 157.82
________ ________ _______ ________
268.22 268.22 0.00 268.22
ETI ENHANCED TELEMANAGEMENT
DUE110995 INVOICE 10/31/95 11/09/95 266.61 266.61 0.00 266.61
________ ________ _______ ________
266.61 266.61 0.00 266.61
EXP001 Express Messenger
08-169229 INVOICE 10/15/95 11/14/95 28.05 28.05 0.00 28.05
________ ________ _______ ________
28.05 28.05 0.00 28.05
FID001 Fidelity Products Co.
0512918 INVOICE 5080 10/04/95 11/03/95 37.97 37.97 0.00 37.97
________ ________ _______ ________
37.97 37.97 0.00 37.97
K AMERICAN FUNDS SERVICE CO
0100695 INVOICE 10/06/95 10/06/95 676.53 676.53 0.00 676.53
000000-000 XXXXXXX 10/20/95 10/20/95 676.53 676.53 0.00 676.53
________ ________ _______ ________
1363.06 1363.06 0.00 1363.06
GOLFSMITH GOLFSMITH
4146018 INVOICE 09/20/95 10/20/95 105.20 105.20 0.00 105.20
4211113 INVOICE 10/24/95 11/23/95 89.35 89.35 0.00 89.35
________ ________ _______ ________
194.55 194.55 0.00 194.55
GRA001 X.X. Xxxxxxxx, Inc.
4952971663 INVOICE 5081 09/25/95 10/25/95 22.91 22.91 0.00 22.91
________ ________ _______ ________
22.91 22.91 0.00 22.91
GRANT XXXXX XXXXXXXX
401K-SEMI INVOICE 10/31/95 11/30/95 425.00 425.00 0.00 425.00
________ ________ _______ ________
425.00 425.00 0.00 425.00
GTE GTE DIRECTORIES
GPT-AD INVOICE 10/31/95 11/15/95 16.20 16.20 0.00 16.20
________ ________ _______ ________
16.20 16.20 0.00 16.20
HARDCOAT HARDCOAT, INC.
10239683 INVOICE 5096 10/23/95 11/22/95 70.00 70.00 0.00 70.00
________ ________ _______ ________
70.00 70.00 0.00 70.00
HONEYWELL HONEYWELL EMPLOYEE'S CLUB
GPT795 INVOICE H 10/19/95 11/03/95 31.99 31.99 0.00 31.99
________ ________ _______ ________
31.99 31.99 0.00 31.99
IND002 Industrial Plastics, Mpls
0022871 INVOICE 5066 10/04/95 11/03/95 445.20 445.20 0.00 445.20
________ ________ _______ ________
445.20 445.20 0.00 445.20
INVEST INVEST CAST INC
0026761 INVOICE 5033 10/01/95 10/31/95 2295.11 2295.11 0.00 2295.11
________ ________ _______ ________
2295.11 2295.11 0.00 2295.11
KUI001 Xxxxxxx Hardware
0010276 INVOICE 10/27/95 11/26/95 2.08 2.08 0.00 2.08
0100295 INVOICE 10/02/95 11/01/95 2.32 2.32 0.00 2.32
0100495 INVOICE 10/04/95 11/08/95 16.12 16.12 0.00 16.12
0103095 INVOICE 10/31/95 11/30/95 11.91 11.91 0.00 11.91
________ ________ _______
________ 32.43 32.43 0.00 32.43
XXX000000 INVOICE 10/19/95 11/03/95 116.75 116.75 0.00 116.75
________ ________ _______ ________
116.75 116.75 0.00 116.75
NEW001 New England Electric Wire
0009606 INVOICE 5059 10/01/95 10/31/95 486.10 486.10 0.00 486.10
________ ________ _______ ________
486.10 486.10 0.00 486.10
NOR002 Northern Airgas, Inc.
0835355 INVOICE 09/30/95 10/30/95 13.10 13.10 0.00 13.10
0837254 INVOICE 10/31/95 11/30/95 13.54 13.54 0.00 13.54
________ ________ _______ ________
26.64 26.64 0.00 26.64
OMI001 Omicron Tool
0009909 INVOICE 5040 09/01/95 10/01/95 150.00 150.00 0.00 150.00
0009922 INVOICE 5024 09/14/95 10/14/95 125.00 125.00 0.00 125.00
0009923 INVOICE 4731 09/14/95 10/14/95 150.00 150.00 0.00 150.00
0009924 INVOICE 4631 09/14/95 10/14/95 187.50 187.50 0.00 187.50
0009925 INVOICE 5054 09/14/95 10/14/95 95.00 95.00 0.00 95.00
0009926 INVOICE 5075 09/18/95 10/18/95 195.30 195.30 0.00 195.30
0009927 INVOICE 5011 09/18/95 10/18/95 425.00 425.00 0.00 425.00
0009940 INVOICE 5085 10/12/95 11/11/95 86.00 86.00 0.00 86.00
0009941 INVOICE 5075 10/17/95 11/16/95 141.50 141.50 0.00 141.50
9XXXX-1914 INVOICE 5103 10/31/95 11/30/95 130.00 130.00 0.00 130.00
________ ________ _______ ________
1685.30 1685.30 0.00 1685.30
PACKNET PACKNET LTD
0041177 INVOICE 10/03/95 10/23/95 137.12 137.12 0.00 137.12
0041408 INVOICE 10/25/95 11/14/95 201.52 201.52 0.00 201.52
0041417 INVOICE 5068 10/31/95 11/20/95 432.62 432.62 0.00 432.62
________ ________ _______ ________
771.26 771.26 0.00 771.26
PATRYAN XXX XXXX GOLF PRODUCTS
0000746 INVOICE 10/19/95 11/18/95 24.46 24.46 0.00 24.46
0000756 INVOICE 10/30/95 11/29/95 38.00 38.00 0.00 38.00
0001486 INVOICE 04/11/95 05/11/95 66.00 66.00 0.00 66.00
0001486 CREDIT 04/30/95 04/30/95 -66.00 -66.00 0.00 -66.00
________ ________ _______ ________
62.46 62.46 0.00 62.46
PRECISION PRECISION REPAIR, INC
0102232 INVOICE 4781 10/01/95 10/16/95 240.00 240.00 0.00 240.00
0102320 INVOICE 4781 10/05/95 10/20/95 29.25 29.25 0.00 29.25
________ ________ _______ ________
269.25 269.25 0.00 269.25
TADSON TADSON INC
0006572 INVOICE 5084 10/04/95 11/03/95 336.00 336.00 0.00 336.00
________ ________ _______ ________
336.00 336.00 0.00 336.00
TWI001 Twin City Oxygen Co.
0362958 INVOICE 09/29/95 10/29/95 17.60 17.60 0.00 17.60
0364520 INVOICE 10/31/95 11/30/95 25.06 25.06 0.00 25.06
________ ________ _______ ________
42.66 42.66 0.00 42.66
UNI002 United Parcel Service
0102195 INVOICE 10/21/95 10/31/95 129.43 129.43 0.00 129.43
0102895 INVOICE 10/28/95 11/07/95 58.93 58.93 0.00 58.93
________ ________ _______ ________
188.36 188.36 0.00 188.36
US-WEST US WEST DIRECT
1756178000 INVOICE 10/22/95 11/06/95 38.80 38.80 0.00 38.80
________ ________ _______ ________
38.80 38.80 0.00 38.80
VISA BANKCARD CENTER
QUALITY= INVOICE 5980 10/24/95 11/13/95 254.83 254.83 0.00 254.83
________ ________ _______ ________
254.83 254.83 0.00 254.83
WAR001 Warner Industrial Supply
1173980-01 INVOICE 5077 09/26/95 10/26/95 208.36 208.36 0.00 208.36
1173980-02 INVOICE 5077 10/24/95 11/23/95 34.62 34.62 0.00 34.62
________ ________ _______ ________
242.98 242.98 0.00 242.98
WIFFLER XXXX XXXXXXX
COMM INVOICE 10/31/95 11/05/95 10.97 10.97 0.00 10.97
________ ________ _______ ________
10.97 10.97 0.00 10.97
XXX000 X.X. Xxxx & Associates
36083-10 INVOICE 5023 09/25/95 09/25/95 2078.02 2078.02 0.00 2078.02
________ ________ _______ ________
2078.02 2078.02 0.00 2078.02
========= ========= ======= ========
31205.59 31205.59 0.00 31205.59
MC Software, Inc. MAG-HEAD ENGINEERING COMPANY, INC. 10/31/95
PREP05 Accounts Receivable - Aged Trial Balance Page 1
Aged on 10/31/95
ACCOUNT BALCURRENT DUE PAST DUE CREDIT 1-30 31-60 00-00 00-000 PRIOR
3-M 3M ACCOUNTS PAYABLE
9422.55 4122.55 5300.00 0.00 300.00 5000.00 0.00 0.00 0.00
AIWA AIWA CO., LTD TECH CENTER ###-##-####
1091.00 0.00 1091.00 0.00 0.00 1091.00 0.00 0.00 0.00
B&D B. & D. INSTRUMENTS INC. 000-000-0000
7208.50 0.00 7208.50 0.00 0.00 7208.50 0.00 0.00 0.00
BRO001 Broadcast Electronics Inc 000-000-0000
3585.75 1184.72 2401.03 0.00 0.00 2401.03 0.00 0.00 0.00
FT XXXX ACCOUNTS PAYABLE 000-000-0000
56764.90 19641.30 37123.60 0.00 21830.00 15293.60 0.00 0.00 0.00
ESI001 ELECTRO SOUND INC.
899.09 899.09 0.00 0.00 0.00 0.00 0.00 0.00 0.00
FID001 FIDELIPAC CORPORATION 000-000-0000
152.68 152.68 0.00 0.00 0.00 0.00 0.00 0.00 0.00
GEORGENS GEORGENS INDUSTRIES INC 000-000-0000
34712.55 13944.63 20767.72 0.00 13298.54 7469.18 0.00 0.00 0.00
HAL001 HALL ELECTRONICS 000-000-0000
717.18 197.93 519.25 0.00 0.00 519.25 0.00 0.00 0.00
ICT001 ICT, Ltd. Unit 74 01144932572215
3212.95 0.00 3212.95 0.00 0.00 3212.95 0.00 0.00 0.00
ITC001 International Tapetronics 000-000-0000
9191.32 0.00 9191.32 0.00 1818.38 4621.97 2750.97 0.00 0.00
LOR001 Xxxxx Xxxxxxxxx Corp. 000-000-0000
35345.50 22485.50 12860.00 0.00 0.00 12860.00 0.00 0.00 0.00
OTA001 Otari Corporation 000-000-0000
773.25 0.00 773.25 0.00 0.00 773.25 0.00 0.00 0.00
PAC001 Pacific Recorders & Eng. 000-000-0000
681.25 0.00 681.25 0.00 0.00 681.25 0.00 0.00 0.00
SCI001 SCI Systems, Inc. 000-000-0000
36106.25 0.00 36106.25 0.00 0.00 36106.25 0.00 0.00 0.00
SEAGATE SEAGATE
66.00 0.00 66.00 0.00 0.00 66.00 0.00 0.00 0.00
XEL001 XEL COMMUNICATIONS, INC. 000-000-0000
24.40 0.00 24.40 0.00 0.00 24.40 0.00 0.00 0.00
199965.12 62628.60 137326.52 0.00 37246.92 97328.63 2750.97 0.00 0.00
OCTOBER 1995
HONEYWELL SALES INVOICE COMM COMM AMOUNT DATE A/R HOW
DIV # CUSTOMER SALE AMOUNT SALES $ TAX LABOR FREIGHT TOTAL TOTAL % PAID PAID DUE PAY??
____ __________ ___________ ________ _____ _____ _______ _______ _____ _____ _______ _______ ______ _______
000 XXX XXXX 7-6-95 $200.22
769 XXX XXXXX 9-20-95 $202.50 10-20-95 AMP CHECK
AMP SERVICES
774 XXXXX XXXXXXX 9-95 130.50 10-31-95 CHECK 5743
781 XXXXX XXXXXXX $67.00 $0.00 $0.00 $0.00 $67.00 $4.69 $0.07 67.00 10-31-95 CHECK 5743
782 XXXX XXXXX 8.58 0.56 0.00 0.00 8.14 0.60 0.07 9.14 10-4-95 CASH
783 WIILY 25.71 1.67 0.00 0.00 27.38 1.50 0.07 27.38 10-4-95 CASH
784 XXXX XXXXXXX 0.00 0.00 0.00 0.00 5.00 0.35 0.07 6.00 10-17-95 CASH
785 XXXXXXX XXXXXX 150.00 9.75 0.00 0.00 159.75 10.50 0.07 159.75 10-11-95 CHECK 7111
786 XXXXX XXXXXXX 0.00 0.00 25.00 0.00 25.00 1.75 0.07 25.00 10-11-95 CHECK 8382
787 XXXXXXX XXXXXX 12.00 0.78 4.50 0.00 17.28 1.16 0.07 17.28 10-11-95 CHECK 7111
788 XXX RETHSEN 10.00 0.65 4.00 0.00 14.65 0.98 0.07 14.65 10-13-95 CASH
789 WILLY 13.65 0.89 0.00 0.00 14.54 0.96 0.07 14.54 10-13-95 VISA
790 VOID VOID VOID VOID VOID VOID VOID VOID VOID VOID VOID VOID VOID VOID
791 XXX ROOFES 23.50 1.53 0.00 0.00 25.08 1.65 0.07 25.08 10-24-95 CHECK 4138
792 GUY FIRAS 100.00 6.50 0.00 0.00 106.50 7.00 0.07 106.50 10-16-95 CHECK 1086
793 XX XXXXXXX 18.00 1.17 4.00 0.00 23.17 1.54 0.07 23.17 10-18-95 CHECK 5309
794 XXX RETHSEN 8.75 0.57 7.50 0.00 16.82 1.14 0.07 16.82 10-18-95 CASH
795 XXXX HECQUIST 158.00 $199.99 13.00 0.00 0.00 181.00 11.76 0.07 212.98 10-20-95 CHECK 3677
(31.99) HONEYWELL $
796 XXXX HECQUIST 165.00 10.73 0.00 0.00 175.73 11.56 0.07 175.73 10-20-95 CHECK 3677
797 XXXX HECQUIST 78.50 5.10 0.00 0.00 83.60 5.50 0.07 83.80 10-25-95 CHECK 3632
798 XXXX XXXXXXXXX 424.50 0.00 0.00 0.00 424.50 29.72 0.07 424.50 10-25-95 VISA
799 ART XXXXXXXX 336.00 0.00 0.00 17.00 362.00 23.45 0.07 $352.00
800 XXX BUDLA 75.00 4.88 0.00 0.00 79.88 5.25 0.07 79.88 10-27-95 CHECK 5672
801 XXX JOROAN 338.00 0.00 0.00 0.00 338.00 23.66 0.07 338.00
000 XXX X XXX 000.00 17.42 0.00 0.00 285.42 18.76 0.07 VISA IN 10-31-95 285.42 VISA 10-31
TRANSIT
$2,289.19 $199.99 $75.18 $50.00 $17.00 $2,431.37 $163.74 7% $1,788.96 $1,175.64
XXXXXXX
Schedule 1.3.1
Assignment of Lease
See attached.
ASSIGNMENT OF LEASE
Assignment of the Lease ("Lease"), dated September
12, 1990 (as amended by a certain (i) Rider, dated
September 12, 1990, (ii) Amendment to Lease, dated
November 19, 1990, and (iii) Agreement to Extend Lease,
dated January 14, 1994), between Lutheran Brotherhood, a
Minnesota corporation ("Landlord"), and Mag-Head
Engineering, Inc. (now known as Mag-Head Engineering
Company, Inc.), a Minnesota corporation ("Tenant"), by
which the premises herein commonly described as 000-000
Xxxxxxxxxxx Xxxxxx Xxxxx, Xxxxxx Xxxxxx, Xxxxxxxxx (the
"Premises") are demised for a term commencing on
September 12, 1990 and ending on January 31, 1997.
ASSIGNMENT BY TENANT
For value received, Tenant does hereby assign all of
Tenant's right, title and interest in and to the Lease
from and after February __, 1996 (the "Assignment Date")
unto Ahead Technology Acquisition Corporation, a Delaware
corporation ("Assignee"). The Premises are to be used
and occupied for office, warehouse and manufacturing
purposes in connection with the electrical component,
magnetic recording head and golf club business, and all
related or reasonably comparable purposes, and for no
other purpose. Tenant shall not be liable for
obligations arising under the Lease following the
Assignment Date. Notwithstanding the foregoing, it is
expressly agreed that this assignment shall not release
or relieve Tenant from any liability under the Lease for
any obligations or events incurred or arising, or
activities conducted on or condition of the Premises,
prior to the Assignment Date.
Dated: February __, 1996 TENANT:
MAG-HEAD ENGINEERING, INC.
(not known as MAG-HEAD
ENGINEERING COMPANY, INC.)
By: ______________________
Its: ______________________
ACCEPTANCE OF TENANT'S ASSIGNMENT
In consideration of the above Assignment and of the
written consent of Landlord thereto, Assignee (binding
also Assignee's heirs, successors and assigns) hereby
assumes and agrees to make all payments and to perform
and keep all promises, covenants and conditions and
agreements of the Lease by Tenant to be made, kept and
performed from and after the Assignment Date.
Notwithstanding the foregoing, it is expressly agreed
that Assignee shall not be liable under the Lease for any
obligations or events incurred or arising, or activities
conducted on or condition of the Premises, prior to the
Assignment Date.
Dated: February __, 1996 ASSIGNEE:
AHEAD TECHNOLOGY ACQUISITION
CORPORATION
By: ______________________
Its: ______________________
CONSENT TO TENANT'S ASSIGNMENT
Landlord hereby consents to the foregoing assignment
of the Lease by Tenant to Assignee in consideration of
the Tenant's promises, covenants and agreements herein
above expressed, and upon the express condition that
Tenant shall remain liable for any obligations or events
incurred or arising, or activities conducted on or
condition of the Premises, prior to the Assignment Date,
and in consideration likewise of the covenants, promises
and agreements of Assignee above set forth. Landlord
does not consent to any further assignment of the Lease
nor to any subletting of the Premises or any part
thereof.
Landlord has not at any time in the past engaged in
nor permitted, and has no knowledge that any third person
or entity engaged in or permitted any operations or
activities upon, or any use or occupancy of the Premises,
or any portion thereof, for the purpose of or in any way
involving the handling, manufacturing, treatment,
storage, use, transportation, spillage, leakage, dumping,
discharge or disposal (whether legal or illegal,
accidental or intentional) of any hazardous substances,
materials or wastes, or any wastes regulated under any
local, state or federal law.
Dated: February __, 1996 LANDLORD:
LUTHERAN BROTHERHOOD
By: ______________________
Its: ______________________
Schedule 2.4
Allocation
Asset Allocation
Cash $ 72,503.00
Deposits 1,685.00
Accounts Receivable 201,130.00
Inventory 175,643.00
Fixed Assets 36,030.00
$486,991.00
Less: Accounts Payable
as of 10/31/95 30,965.00
Purchase Price $456,026.00
Schedule 3.2
Capitalization
See Attached.
Sheet 1
MEC stockholders as provided [9/28/95]
Total shares 561,362
outstanding
Initial
Capitalization @
$1/ea. 561,362
Employees: # Shares Initial $ Value/ea. Loss
Xxxx Xxxxxxx 120,000 120,000 84,994.80 35,005.20
(President)
Xxxxx Xxxxxxxxx 38,000 38,000 26,915.02 11,084.98
(Operations)
Outsiders:
Xxxx Xxxxxxx 220,000 220,000 155,823.80 64,176.19
Xxxxx 68,000 68,000 48,163.72 19,836.28
Xxxxxxxxxxx 66,000 66,000 46,747.14 19,252.86
Xxxxxxxx 50,000 50,000 35,414.50 14,585.50
Total shares 562,000
Present Networth 396,059 398,059 163,941
Present
price/share 0.70829
Schedule 3.3
Financial Statements
See Attached.
MAG-HEAD ENGINEERING COMPANY, INC. 10/31/95
Balance Sheet Page 1
Tuesday, October 31, 1995
CURRENT ASSETS
XXXXX CASH 50
CASH-CHECKING 72453
CASH-SAVINGS 0
RENT DEPOSITS 1685
MED-GPT RENT/REVEIVABLE 0
ACCOUNTS RECEIVE TRADE 199955
GPT-A/R 1175
GPT-INVENTORY 20759
GPT-F/G 11211
INVENTORY - P/P 78133
INVENTORY - WIP 59251
INVENTORY - F/G 32673
SUSPENSE ACCOUNT 0
PREPAID EXPENSES 2356
TOTAL CURRENT ASSETS 479701
FIXED ASSETS
LEASEHOLD IMPROVEMENTS 490
MACHINERY & EQUIPMENT 271368
OFFICE EQUIPMENT 8386
ACCUMULATED DEPRECIATE 244214
TOTAL FIXED ASSETS: 36030
OTHER ASSETS
TOTAL ASSETS 515731
MAG-HEAD ENGINEERING COMPANY, INC. 10/31/95
Balance Sheet Page 2
Tuesday, October 31, 1995
CURRENT LIABILITIES
ACCOUNTS PAYABLE 30965
GPT-A/P 0
ACCRUED PAYROLL 12822
NOTE PAYABLE-1ST BANK 0
MISC PAYROLL DEDUCTION ( 1)
DIVIDENDS PAYABLE 0
FED/FICA TAX 0
STATE TAX 0
401K PAYABLE 386
GPT COMMISSIONS PAYABLE ( 1)
GPT-EMPLOYEE COMM 1
GPT-HONEYWELL COMM 0
MEC SALES TAX PAYABLE 0
GPT-SALES TAX PAYABLE 75
________
TOTAL CURRENT LIABIL 44247
LONG TERM LIABILITIES:
TOTAL LONG-TERM LIA 0
TOTAL LIABILITIES 44247
EQUITY
COMMON STOCK 5614
PAID IN CAPITAL 543386
RETAINED EARNINGS ( 150854)
EARNINGS CURRENT 73360
TOTAL EQUITY 471495
TOTAL LIAB & EQUITY 615743
MAG-HEAD ENGINEERING COMPANY, INC. 10/31/95
Income Statement Page 1
Tuesday, October 31, 1995
Period %SALES Year to Date %SALES
REVENUE
SALES MANUFACTURED HEAD 99718 97.71 566524 75.66
SALES RETURNS 0 0.00 44 0.01
SALES-NOT MFG MEC 0 0.00 90009 12.02
GPT-SALES 2339 2.29 92238 12.32
TOTAL REVENUE 102057 100.00 748815 100.00
COST OF GOODS SOLD
COST OF MATERIALS 28645 28.07 140970 18.83
GPT-COGS 1156 1.13 64722 8.64
DIRECT LABOR 15144 14.84 105619 14.10
GPT-DIRECT LABOR 0 0.00 7305 0.98
MFG ENG SALARY 5415 5.31 41561 5.55
OUTSIDE LABOR 200 0.20 8586 1.15
PRODUCTION SALARY 2877 2.82 22673 3.03
PAYROLL TAXES 1892 1.85 20104 2.68
OUTSIDE ENG SUPPORT 0 0.00 120 0.02
WORKERS COMP INS 845 0.83 3946 0.53
GENERAL INS 496 0.49 3968 0.53
HEALTH INS 1413 1.38 10690 1.43
BUILDING RENT 4583 4.49 36110 4.82
UTILITIES 485 0.48 4521 0.60
EQUIPMENT RENTAL 164 0.16 1742 0.23
SMALL TOOLS 0 0.00 296 0.04
PACKAGING SUPPLIES 771 0.76 3904 0.52
GPT-PACKAGING 0 0.00 0 0.00
GPT-PRODUCTION SUPPLIES 7 0.01 547 0.07
PRODUCTION SUPPLIES 257 0.25 6109 0.82
TOOLING MAINTENANCE 270 0.26 1803 0.24
BUILDING MAINTENANCE 242 0.24 1944 0.26
POSTAGE & FREIGHT 274 0.27 1068 0.14
GPT-FREIGHT 0 0.00 0 0.00
DEPRECIATION 1423 1.39 12361 1.65
OTHER PROD EXPENSES 0 0.00 0 0.00
COGS-NOT MFG MEC 0 0.00 69729 9.31
TOTAL COGS SOLD: 66559 65.22 570398 76.17
OPERATION EXPENSES
ADMINISTRATIVE SALARIES 0 0.00 0 0.00
OFFICE SUPPLIES 12 0.01 525 0.07
GPT-OFFICE SUPPLIES 19 0.02 1550 0.21
PAYROLL TAXES 919 0.90 8296 1.11
TRAVEL 812 0.80 1903 0.25
TELEPHONE 373 0.37 3820 0.51
BAD DEBT EXPENSE 2487 2.44 2487 0.33
ENTERTAINMENT 0 0.00 161 0.02
CONSULTING 0 0.00 0 0.00
CONTRIBUTIONS 0 0.00 0 0.00
DUES & SUBSCRIPTIONS 24 0.02 519 0.07
GPT-SUBSCRIPTIONS 0 0.00 15 0.00
DESIGN ENG SALARIES 2178 2.13 27545 3.68
ACCOUNTING 93 0.09 2252 0.30
OFFICE SALARIES 1667 1.63 13395 1.79
SALES SALARIES 3470 3.40 26385 3.52
GPT SALES SALARIES 3215 3.15 10877 1.45
LEGAL 0 0.00 691 0.09
MISC ADMINISTRATIVE EXP 0 0.00 85 0.01
GPT-VISA SERVIC CHARGE 27 0.03 788 0.11
TOTAL OPER EXPENSES: 15494 15.18 102258 13.66
OTHER INCOME & EXPENSE
401K EXPENSE 663 0.65 2799 0.37
INTEREST INCOME 0 0.00 0 0.00
INTEREST EXPENSE 0 0.00 0 0.00
INCOME TAXES 0 0.00 0 0.00
LEGAL SETTLEMENT 0 0.00 0 0.00
TOTAL OTHER IN & EXP: ( 663) (0.65)( 2799) ( 0.37)
NET INCOME (LOSS) 19342 18.95 73360 9.80
Schedule 3.10
Real Property
1. Lease, dated September 12, 1990 (as amended by a certain (i)
Rider, dated September 12, 1990, (ii) Amendment to Lease, dated
November 19, 1990, and (iii) Agreement to Extend Lease, dated
January 14, 1994), between Lutheran Brotherhood, a Minnesota
corporation, and Mag-Head Engineering, Inc. (now known as Mag-
Head Engineering Company, Inc.), a Minnesota corporation, by
which the premises therein commonly described as 000-000
Xxxxxxxxxxx Xxxxxx Xxxxx, Xxxxxx Xxxxxx, Xxxxxxxxx are demised
for a term commencing on September 12, 1990 and ending on January
31, 1997, a copy of which has been provided by Seller to
Purchaser. Also, all lease deposits thereunder.
Schedule 3.11
Hazardous Substances
Seller shall be solely responsible for the prompt and lawful
removal from the Premises, disposal and required registration of
the freon parts cleaner and freon degreaser identified on the
attached page. Seller shall additionally be responsible for the
payment of all expenses, fines, penalties and taxes related
thereto.
* Presence of a partially filled drum of spent freon parts
cleaner at the loading dock area. Although Mag-Head stopped
the use of freon for parts cleaning several years ago, the
waste solvent has been stored at the site since that time.
* A flammable material storage locker in the golf club
fabrication area contained two five gallon cans of freon
degreaser, one of which was labeled as "new" and the other as
"used."
This spent freon must be properly managed as a hazardous waste
and is further subject to the requirements of management as an
ozone depleting chemical (ODC). Proper disposal will include:
* Mag-Head must register through Hennepin County as a small
quantity hazardous waste generator.
* After registration and obtaining an ID#, Mag-Head must
arrange for proper pick-up, transport, and disposal of the
spent freon.
* There may be some liability for back taxes on the freon as an
ODC (26 CFR 52).
Schedule 3.12
Employee Agreements
See Attached.
August 1, 1995
Subject: Simplified Pay System For Xxxxxxx
From: Xxxx Xxxxxxx
Pay Xxxxxxx $32,000.00/26 pay periods = $1,230.77/per pay period.
We will review sales quarterly to determine where we stand
regarding commission sales. The next review will be at the end
of October.
Our salary package with Xxxxxxx is $2,000.00 per month plus $7%
of all golf sales. We also agreed to $32,000.00 per year as a
minimum salary.
We need to sell $115,000.00 per year in order to break even with
the $1,230.77 per pay period for Xxxxxxx.
I believe that we can exceed $115,000.00 and therefore the need
for tracking sales will be to determine the extra pay that
Xxxxxxx will receive.
This will eliminate the need for a complicated accounting method
to determine Xxxxxxx'x pay.
Schedule 3.13
Key Suppliers/Customers
Local
Primus
U.S. Department of Justice
Schedule 7.1.1
Form of Non-Competition Agreement
Non-Competition Agreement
THIS NON-COMPETITION AGREEMENT (the "Agreement") is made and
entered into as of February __, 1996, by and among Ahead
Technology Acquisition Corporation, a Delaware corporation
("Purchaser"), Mag-Head Engineering Company, Inc., a Minnesota
corporation ("Seller"), and Xxxx Xxxxxxx and Xxxxx Xxxxxxxxx
(each, a "Shareholder" and, together, "Shareholders")
(Shareholders and Seller are sometimes referred to herein as
"Selling Parties"), with reference to the following:
A. Seller is engaged in the business of the
manufacture, production and sale of magnetic recording heads.
B. Concurrent with the execution and delivery of this
Agreement, Selling Parties have conveyed and assigned to
Purchaser certain of the assets and properties of Seller and
Purchaser has assumed certain liabilities of Seller pursuant to a
certain Asset Purchase Agreement, dated as of February __, 1996,
among Purchaser, and Selling Parties (the "Asset Purchase
Agreement"). Capitalized terms used but not defined herein shall
have the respective meanings attributed to such terms in the
Assets Purchase Agreement.
C. Shareholders are the holders of the respective
shares of capital stock of Seller listed below, and hold the
following respective offices of Seller:
Shares of
Shareholder Common Stock Office
Xxxx Xxxxxxx 120,000 President
Xxxxx Xxxxxxxxx 38,000 Vice President
& Secretary
Each Shareholder also is actively engaged in all aspects
of Seller's operations. Each Shareholder knows or has
access to confidential information which is
competitively valuable and/or trade secrets associated
with the operations of Seller.
NOW, THEREFORE, in consideration of the
respective covenants of the parties set forth in this
Agreement and as an inducement for Purchaser to enter
into, and consummate the transactions under, the
Purchase Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto, intending to be
legally bound, hereby agree as follows:
1. Non-Competition. Selling Parties, jointly
and severally, agree that, for a period of eighteen (18)
months after the Closing Date, within the territory set
forth in Schedule 1 hereto, none of the Selling Parties,
either jointly or severally, nor any of their respective
associates or affiliates, shall directly or indirectly
own, operate, become interested in, or carry on or
become involved in any manner whatsoever in any business
which is similar or competitive with any aspect of the
business of Seller as conducted on or prior to the
Closing, including, without limitation, the manufacture,
production or sale of products similar in nature or type
to that offered for sale by Seller on or prior to the
Closing. Without limiting any of the foregoing, the
parties agree that this covenant is intended to prohibit
such Selling Parties, either jointly or severally, from
engaging in such proscribed activities, either, as the
case may be, as an individual, owner, partner, employee,
consultant, stockholder (except as a holder of stock in
a corporation whose stock is publicly traded and which
is subject to the reporting requirements of the
Securities Exchange Act of 1934, and then only to the
extent of owning not more than one percent (1%) of the
issued and outstanding stock of such corporation), agent
or salesman for any person, firm or corporation, or
otherwise.
2. Interference; Confidentiality. Selling
Parties, jointly and severally, agree that:
2.1 For a period of eighteen (18) months
after the Closing Date, neither the Selling Parties nor
any of their associates or affiliates shall hire,
directly or indirectly, any employee employed by Seller
as of the Closing Date who is subsequently employed by
Purchaser during the term hereof, or attempt to induce
any such employee to leave such employ and to work,
directly or indirectly, for or with the Selling Parties
or any such associates or affiliates thereof.
2.2 For a period of eighteen (18) months
after the Closing Date, neither the Selling Parties nor
any of their associates or affiliates shall solicit,
induce or attempt to induce any customer of Seller at
the Closing Date to cease doing business in whole or in
part with Purchaser.
2.3 All documents, inventions, customer,
supplier and prospect lists, business, marketing and
sales information and plans, catalogues, trademarks,
processes, drawings, programs, designs, names,
copyrights, customer requirements, price and cost
information, records, techniques, know-how, business
secrets and other information which has come into the
possession of any of the Selling Parties from time to
time in the course of and for the business of Seller
prior to the Closing Date shall be deemed to be the
confidential and proprietary information of Purchaser.
Each of the Selling Parties shall keep confidential, and
shall not divulge to any other party or use following
the date of this Agreement, any confidential information
or business secrets of Seller existing prior to the
Closing Date, including, but not limited to, any matters
deemed confidential and proprietary as provided in this
section.
3. Separate Covenants. The parties intend
that the covenants and subparagraphs contained in
Paragraphs 1 and 2 hereof shall be construed as a series
of separate covenants, one for each jurisdiction
specified. Except for geographic coverage, each such
separate covenant shall be deemed identical in terms to
the covenant contained in the immediately preceding
subparagraph. If, in any judicial proceeding, a court
shall refuse to enforce any of the separate covenants
deemed included in the immediately preceding
subparagraph, then such unenforceable covenants shall be
deemed eliminated from these provisions for the purpose
of those proceedings solely to the extent necessary to
permit the remaining separate covenants to be enforced.
4. Remedies. In the event that any party
breaches any of its covenants under this Agreement, it
is agreed that the non-defaulting party or parties shall
be entitled to obtain from a court of competent
jurisdiction injunctive relief (including but not
limited to specific performance) directing that such
defaulting party cease and desist from such prohibited
conduct and enforcing the agreements of the defaulting
party hereunder. Such right to injunctive relief shall
be in addition to all other legal and equitable rights
and remedies available to such non-defaulting party.
5. Miscellaneous
5.1 Notices. Any notice to Purchaser
required or permitted under this Agreement shall be
given in accordance with the provisions of the Asset
Purchase Agreement.
5.2 Severability. If any provision of
this Agreement is held invalid or unenforceable, the
remainder of this Agreement shall nevertheless remain in
full force and effect. If any provision is held invalid
or unenforceable with respect to particular
circumstances, it shall nevertheless remain in full
force and effect in all other circumstances.
5.3 Entire Agreement. This Agreement
contains the entire agreement between the parties with
respect to the subject matter hereof, and supersedes all
prior oral and written agreements, understandings,
commitments and practices among the parties with respect
thereto. No amendments, modifications or supplements to
this Agreement may be made except by a writing signed by
the party to be bound.
5.4 Governing Law. This Agreement and
the rights and obligations of the parties hereto shall
be governed by and construed in accordance with the laws
of the State of Minnesota.
5.5 Further Assurances. Each of the
parties hereto shall execute and deliver any and all
additional instruments, documents and other assurances,
and shall do any and all acts and things reasonably
necessary in connection with the performance of their
respective obligations hereunder, to carry out the
intent of the parties hereto.
5.6 Waiver. No delay or omission on the
part of any party hereto in exercising any right under
this Agreement shall operate as a waiver of such right
or any other right, and no waiver of any right conferred
by this Agreement shall be binding unless signed by or
on behalf of each such party. A waiver on one occasion
shall not be construed as a bar to or a waiver of any
party's right to enforce any rights hereunder on any
future occasion.
5.7 Successors and Assigns. This
Agreement shall apply to, and inure to the benefit of,
and be binding upon and enforceable against the parties
hereto and their respective successors and permitted
assigns.
5.8 Attorneys' Fees. If any legal action
or other proceeding is brought for the enforcement of
this Agreement, or because of an alleged dispute,
breach, default or misrepresentation in connection with
any of the provisions of this Agreement, the successful
or prevailing party or parties shall be entitled to
recover reasonable attorneys' fees and other costs
incurred in that action or proceeding, in addition to
any other relief to which it or they may be entitled.
AGREED TO AND ACCEPTED by the parties hereto
as of the day and year first above written.
MAG-HEAD ENGINEERING COMPANY, INC.
By:_____________________________
Xxxx Xxxxxxx, President
By:_____________________________
Xxxxx Xxxxxxxxx, Secretary
__________________________________
XXXX XXXXXXX ("Shareholder")
__________________________________
XXXXX XXXXXXXXX ("Shareholder")
AHEAD TECHNOLOGY ACQUISITION
CORPORATION
By:_____________________________
____________________________,
Title:______________________
Schedule 1
Geographic Territory
All cities, counties and jurisdictions within the United
States and worldwide within which or to Seller has
conducted its business or made sales on or prior to the
date hereof, including, without limitation, the City of
Golden Valley, in the Sate of Minnesota.
Schedule 7.4
Discounts/Concessions
None.
Schedule 9.2.1
Warranty Xxxx of Sale
This Warranty Xxxx of Sale is given with
respect to and in accordance with the Asset Purchase
Agreement, dated as of February __, 1996 (the "Purchase
Agreement"), between Mag-Head Engineering Company, Inc.,
a Minnesota corporation ("Seller"), and Ahead Technology
Acquisition Corporation, a Delaware corporation
("Purchaser"), among others. Capitalized terms not
otherwise defined in this Warranty Xxxx of Sale shall
have the meanings given to them in the Purchase
Agreement.
1. For good and valuable consideration, the
receipt and adequacy of which is acknowledged, Seller
hereby sells, transfers and assigns to Purchaser (and to
Purchaser's successors and assigns forever) all of
Seller's rights, title and interest in and to the
Assets, including, without limitation, all Fixed Assets
listed in Schedule 1.1.1 of the Purchase Agreement and
all inventory, work-in-progress and stock-in-trade of
Seller.
2. Seller represents and warrants to
Purchaser that (i) Seller has good and marketable title
to all of the Assets, and (ii) the assets are not
subject to any mortgage, pledge, lien, conditional sale
agreement, security agreement, encumbrance or charge of
any kind or nature.
IN WITNESS WHEREOF, Seller and Purchaser have
executed this Warranty Xxxx of Sale, effective as of
February __, 1996.
MAG-HEAD ENGINEERING COMPANY, INC.
By:_____________________________
Xxxx Xxxxxxx, President
By:_____________________________
Xxxxx Xxxxxxxxx, Secretary
[Acknowledgement]
AHEAD TECHNOLOGY ACQUISITION
CORPORATION
By:______________________________
_________________________,
Title:________________________
[Acknowledgement]
Schedule 9.2.2
Assignment of Intangibles
This Assignment is given with respect to and
in accordance with the Asset Purchase Agreement, dated
as of February __, 1996 (the "Purchase Agreement"),
between Mag-Head Engineering Company, Inc., a Minnesota
corporation ("Seller"), and Ahead Technology Acquisition
Corporation, a Delaware corporation ("Purchaser"), among
others. Capitalized terms not otherwise defined in this
Assignment shall have the respective meanings given to
them in the Purchaser Agreement.
Seller, for good and valuable consideration,
the receipt and adequacy of which is acknowledged,
hereby sells, assigns and transfers to Purchaser all of
its right, title and interest in and to the goodwill and
other intangibles of Seller listed in Schedules 1.1.3,
1.1.4 and 1.1.5 of the Purchase Agreement and sold
pursuant thereto, including, without limitation, the
Proprietary Rights.
IN WITNESS WHEREOF, Seller and Purchaser have
executed this Assignment of Intangibles as of February
__, 1996.
MAG-HEAD ENGINEERING COMPANY, INC.
By:_____________________________
Xxxx Xxxxxxx, President
By:_____________________________
Xxxxx Xxxxxxxxx, Secretary
[Acknowledgement]
AHEAD TECHNOLOGY ACQUISITION
CORPORATION
By:______________________________
_____________________________,
Title:________________________
[Acknowledgement]
SCHEDULE 9.2.3
ASSIGNMENT AND ASSUMPTION OF CONTRACTS
This Assignment and Assumption of Contracts is
given with respect to and in accordance with the Asset
Purchase Agreement, dated as of February __, 1996 (the
"Purchase Agreement"), between Mag-Head Engineering
Company, Inc., a Minnesota corporation ("Assignor"), and
Ahead Technology Acquisition Corporation, a Delaware
corporation ("Assignee"), among others. Capitalized
terms not otherwise defined in this Assignment and
Assumption of Contracts shall have the respective
meanings given to them in the Purchase Agreement.
1. Assignor, for good and valuable consideration,
the receipt and adequacy of which is
acknowledged, hereby assigns and transfers to
Assignee all of Assignor's right, title and
interest in and to all of the contracts and
commitments listed on Exhibit "A" attached
hereto (the "Assigned Contracts").
2. Assignee hereby assumes and agrees to perform
all of the obligations of Assignor under the
Assigned Contracts from and after the Closing
Date.
3. Assignee is not assuming any liability or
obligation of Assignor relating to or arising
from Assignor's performance of or failure to
perform any obligation under any Assigned
Contracts prior to the Closing Date.
4. This Assignment and Assumption of Contracts
will not affect Assignee's right to assert any
defense under any Assigned Contract, at law,
in equity or otherwise against the validity or
enforceability of any liability or obligation
under any Assigned Contract.
IN WITNESS WHEREOF, Assignor and Assignee have
executed this Assignment and Assumption of Contracts as
of February __, 1996.
MAG-HEAD ENGINEERING COMPANY, INC.
By:_______________________________
Xxxx Xxxxxxx, President
By:_______________________________
Xxxxx Xxxxxxxxx, Secretary
AHEAD TECHNOLOGY ACQUISITION CORPORATION
By:___________________________________
_________________________,
Title:____________________________
Exhibit "A"
1. Lease, dated September 12, 1990 (as amended by a
certain (i) Rider, dated September 12, 1990, (ii)
Amendment to Lease, dated November 19, 1990, and (iii)
Agreement to Extend Lease, dated January 14, 1994),
between Lutheran Brotherhood, a Minnesota corporation,
and Mag-Head Engineering, Inc. (now known as Mag-Head
Engineering Company, Inc.), a Minnesota corporation, by
which the premises therein commonly described as 000-000
Xxxxxxxxxxx Xxxxxx Xxxxx, Xxxxxx Xxxxxx, Xxxxxxxxx are
demised for a term commending on September 12, 1990 and
ending on January 31, 1997.
2. All Accounts Receivable Trade (including,
without limitation, those identified in Schedule 1.1.3 to
the Purchase Agreement) of Seller.
3. All GPT - A/R (including, without limitation,
those identified in Schedule 1.1.3 to the Purchase
Agreement) of Seller.
4. Copier lease with "Imaging Systems," provided to
Purchaser by Seller.
5. All customer sales/purchase orders (including,
without limitation, those identified in Schedule 1.1.3 to
the Purchase Agreement) of Seller.
SCHEDULE 9.2.5
AFFIDAVIT OF SELLER
See Attached.
TRANSFEROR'S CERTIFICATION OF NON-FOREIGN STATUS
To inform Ahead Technology Acquisition Corporation,
a Delaware corporation ("Transferee"), that withholding
of tax under Section 1445 of the Internal Revenue Code of
1986, as amended ("Code"), will not be required upon the
consummation of transactions under that certain Asset
Purchase Agreement, dated as of February __, 1996, by and
between Transferee and Mag-Head Engineering Company,
Inc., a Minnesota corporation ("Transferor"), Transferor
hereby certifies to the following on behalf of the
Transferor:
1. The Transferor is not a foreign corporation,
foreign partnership, foreign trust, or foreign estate (as
those terms are defined in the Code and the Income Tax
Regulations promulgated thereunder);
2. The Transferor's U.S. employer identification
number is ________________; and
3. The Transferor's office residence address is 000
Xxxxxxxxxxx Xxxxxx, Xxxxxx Xxxxxx, Xxxxxxxxx 00000.
The Transferor understands that this Certification
may be disclosed to the Internal Revenue Service by the
Transferee and that any false statement contained herein
could be punished by fine, imprisonment, or both.
The Transferor understands that the Transferee is
relying on this Certification in determining whether
withholding is required upon said transfer.
Under penalty of perjury I declare that I have
examined this Certification and to the best of my
knowledge and belief it is true, correct and complete,
and I further declare that I have authority to sign this
document on behalf of the Transferor.
Dated: February __, 1996 MAG-HEAD ENGINEERING
COMPANY, INC.
By:____________________________
Xxxx Xxxxxxx, President
By:____________________________
Xxxxx Xxxxxxxxx, Secretary
SCHEDULE 9.2.7.(a)
SELLER'S OFFICER'S CERTIFICATE
SELLER CERTIFICATE
Reference is made to that certain Asset Purchase
Agreement (the "Asset Purchase Agreement"), dated as of
February __, 1996, by and between Mag-Head Engineering
Company, Inc., a Minnesota corporation ("Seller"), and
Ahead Technology Acquisition Corporation, a Delaware
corporation ("Purchaser"), among others. Capitalized
terms used but not defined herein have the respective
meanings assigned to such terms in the Asset Purchase
Agreement. Seller hereby certifies that:
1. The undersigned, Xxxxx Xxxxxxxxx, executing this
Certificate on behalf of Seller, is the duly elected and
acting officer of Seller holding the office of Secretary
of Seller.
2. Attached hereto as Exhibit A is a copy of the
Articles of Incorporation of Seller.
3. Attached hereto as Exhibit B is a true and
correct copy of the Bylaws of Seller in effect as of the
date hereof.
4. Attached hereto is a true and correct copy of
(i) resolutions of the Board of Directors of Seller
adopted by unanimous written consent of the Board on
February __, 1996, which resolutions have not been
revoked, modified, amended or rescinded and are still in
full force and effect, and pursuant to which the Asset
Purchase Agreement and Seller's sale of the Assets to
Purchaser have been duly approved and adopted by such
Board of Directors; and (ii) resolutions of the
shareholders of Seller adopted by unanimous written
consent of such shareholders on February __, 1996, which
resolutions have not been revoked, modified, amended or
rescinded and are still in full force and effect, and
pursuant to which the Asset Purchase Agreement and
Seller's sale of the Assets to Purchaser have been duly
approved and adopted by such shareholders.
5. There is currently no proceeding for the
dissolution or liquidation of Seller or threatening its
existence.
6. The representations and warranties of each of
Seller and Shareholder set forth in the Asset Purchase
Agreement and the Assignment, and each other agreement,
document, instrument, exhibit and schedule thereto and
delivered in connection therewith, are true and accurate
as of the date hereof, which date shall be deemed to be
the Closing Date for the purposes of the Asset Purchase
Agreement, and all of each of Seller's and Shareholder's
obligations set forth in Paragraphs 5, 6 and 7 of the
Asset Purchase Agreement have been completed, satisfied
and complied with.
7. The Asset Purchase Agreement and each other
agreement, document, instrument, exhibit and schedule
thereto and delivered in connection therewith, to which
any of the undersigned is a party, is in full force and
effect with respect to such party, and enforceable
against each party, in accordance with its terms.
8. Seller's conditions to Closing set forth in
Section 8 of the Asset Purchaser Agreement are either
satisfied or deemed waived.
Executed at _____________, ________, on this _____
day of February, 1996.
MAG-HEAD ENGINEERING COMPANY, INC.
By:________________________________
Xxxxx Xxxxxxxxx, Secretary
EXHIBIT A
ARTICLES OF INCORPORATION
EXHIBIT B
BYLAWS
SCHEDULE 9.2.7(B)
PURCHASER'S OFFICER'S CERTIFICATE
PURCHASER CERTIFICATE
Reference is made to that certain Asset Purchase
Agreement (the "Asset Purchase Agreement"), dated as of
February __, 1996, by and between Mag-Head Engineering
Company, Inc., a Minnesota corporation ("Seller"), and
Ahead Technology Acquisition Corporation, a Delaware
corporation ("Purchaser"), among others. Capitalized
terms used but not defined herein have the respective
meanings assigned to such terms in the Asset Purchase
Agreement. Purchaser hereby certifies that:
1. The undersigned, Xxxxx Xxxxxxx, executing this
Certificate on behalf of Purchaser, is the duly elected
and acting officer of Treasurer of Purchaser.
2. Attached hereto as Exhibit A is a copy of the
Articles of Incorporation of Purchaser.
3. Attached hereto as Exhibit B is a true and
correct copy of the Bylaws of Purchaser in effect as of
the date hereof.
4. Attached hereto is a true and correct copy of
(i) the resolutions duly adopted by the Board of
Directors of Purchaser by unanimous written consent on
January __, 1996, which resolutions have not been
revoked, modified, amended or rescinded and are still in
full force and effect, and pursuant to which the Asset
Purchase Agreement and Purchaser's purchase of the Assets
from Seller have been duly approved and adopted by such
Board of Directors.
5. There is no proceeding for the dissolution or
liquidation of Purchaser or threatening its existence.
6. The representations and warranties of Purchaser
set forth in the Asset Purchase Agreement and the
Assignment, and each other agreement, document,
instrument, exhibit and schedule thereto and delivered in
connection therewith, are true and accurate as of the
date hereof, which date shall be deemed to be the Closing
Date for the purposes of the Asset Purchase Agreement,
and all of each of Purchaser's obligations set forth in
Paragraph 8 of the Asset Purchase Agreement have been
completed, satisfied and complied with.
7. The Asset Purchase Agreement and each other
agreement, document, instrument, exhibit and schedule
thereto and delivered in connection therewith, to which
the Purchaser is a party, is in full force and effect,
with respect to such party, and enforceable against each
such party, in accordance with its terms.
8. Purchaser's conditions to Closing set forth in
Section 6 of the Asset Purchaser Agreement are satisfied
or deemed waived.
Executed at Santa Clara, California, on this _____
day of February, 1996.
AHEAD TECHNOLOGY ACQUISITION CORPORATION
By:____________________________________
___________________________________,
Title:_____________________________
EXHIBIT A
ARTICLES OF INCORPORATION
EXHIBIT B
BYLAWS
SCHEDULE 9.2.9
FORM OF SELLER'S COUNSEL OPINION
See attached.
