EXHIBIT 2
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT ("Agreement") is made and entered
into this 9th day of April, 1999, by and between Norton Acquisition
Corporation, a Minnesota corporation ("Buyer") and Norton Motors
International Inc., a Minnesota corporation ("Seller").
WITNESSETH:
WHEREAS, Seller is developing a line-up of engines and motorcycles
for manufacture and sale (the "Business");
WHEREAS, Seller has acquired certain assets from Norton Motorcycles
Limited pursuant to the Asset Purchase Agreement dated March 11, 1998
(the "Norton Agreement") which has enabled it to develop the Business;
and,
WHEREAS, Buyer desires to acquire from Seller the Business and
substantially all of Seller's assets (including those acquired through
the Norton Agreement) used in the Business on a going concern basis and
Seller desires to sell the Business and such assets on a going concern
basis in the manner and upon the terms and conditions stated herein.
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements contained herein and for other good
and valuable consideration, the receipt and sufficiency of which are
mutually acknowledged and accepted, Seller and Buyer, intending to be
legally bound, hereby agree as follows:
ARTICLE 1
SALE AND PURCHASE OF ASSETS
1.1 Assets To Be Purchased By Buyer. Subject to the terms and
conditions set forth herein, Seller agrees to sell, transfer, convey
and assign to Buyer, and Buyer agrees to purchase and acquire from
Seller all of Seller's assets of any kind or type whatsoever,
including, but not limited to, the assets listed on Exhibits 1.1 and
1.1(B) attached hereto (the "Purchased Assets").
1.2 Excluded Assets. Notwithstanding anything to the contrary in
Section 1.1, the Purchased Assets shall not include any of the assets
expressly listed on Exhibit 1.2 attached hereto (the "Excluded
Assets").
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ARTICLE 2
ASSUMPTION OF LIABILITIES
2.1 Assumed Liabilities. At the Closing, Buyer shall assume and agree
to discharge and perform when due, the following expressly identified
liabilities and obligations of Seller ( the "Assumed Liabilities"):
2.1.1 Such pending purchase orders issued by Seller relating
to the Business as Buyer shall, in its sole discretion,
agree to assume. Buyer shall have ninety (90) days
from Closing in which to assume or reject any such
pending purchase orders. In connection with any such
purchase orders, Seller assigns to Buyer any rights of
Seller with respect to any prepaid deposits previously
paid by third parties for the benefit of Seller.
2.1.2 Such Seller's Trade Accounts Payable for suppliers and
developers set forth on Exhibit 2.1.2 attached hereto,
as Buyer assumes in writing, in its sole discretion, on
or before the 90th day following the Closing Date
("Trade Accounts Payable").
2.1.3 The liability and principal balance of the secured
loans to Xxxxxx X. Xxxxx, Xxxxxx Xxxxxxxxx, Global Coin
Corporation ("Global") and Cataract N.V. ("Cataract")
(including, without limitation, the registered or
unregistered mortgage of Global and Cataract covering
the Norton Factory (on Xxxx Xxxx in Shenstone,
Staffordshire, England) that Buyer shall assume as of
the Closing Date in the amounts and pursuant to the
terms specifically identified on Exhibit 2.1.3
("Secured Liability").This amount includes any unpaid
interest amounts owing on such debt prior to the
Closing Date, which Buyer shall assume and pay. If at
Closing said mortgage has not yet been registered, then
said mortgage shall be reissued by the Buyer and
registered. Buyer may in such regard take the benefit
of any funds which were to be used to pay any stamp
duty taxes on said mortgage.
2.1.4 Certain additional obligations arising from the Norton
Agreement as the same are listed on Exhibit 2.1.4
attached hereto.
2.2 Excluded Liabilities. Except as specifically set forth in Section
2.1 above, Buyer is not assuming any other liability or obligation of
Seller whatsoever, whether or not any such liability or obligation
pertains to the Business or the Purchased Assets, including any such
liability or obligation arising under any contract of Seller (all such
liabilities and obligations not specifically assumed by Buyer pursuant
to the Agreement shall be the "Excluded Liabilities"). Without
limiting the foregoing and notwithstanding the provisions of Section
2.1, Buyer is expressly not assuming the following liabilities:
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2.2.1 Any liabilities of Seller for taxes, including without
limitation income, FICA, sales, use, franchise, excise
and transfer taxes.
2.2.2 Any liabilities and obligations of Seller under any
contracts, agreements, leases, licenses, instruments,
commitments, arrangements or undertakings of any kind,
including, but not limited to, trade payable
liabilities of any kind whatsoever, except those
liabilities and obligations specifically set forth in
Section 2.1.
2.2.3 Any liability or obligation of Seller for warranty
claims with respect to products sold or services
rendered by Seller prior to the Closing Date.
2.2.4 Any indebtedness of Seller to banks, other financial
institutions or with respect to borrowed money, except
those specific liabilities set forth and expressly
assumed in Section 2.1.
2.2.5 Any liabilities to or with respect to former employees
of Seller whether or not hired by Buyer, relating to
any period prior to the Closing Date (including without
limitation any liabilities to employees or plans with
respect to post-retirement health benefits or
pensions), and any liabilities with respect to any
other employees or former employees of Seller
(including without limitation any severance or COBRA
liabilities or any liabilities to employees or plans
with respect to post-retirement health benefits or
pensions).
2.2.6 Any claims against or liabilities of Seller for injury
to or death of persons or damage to or destruction of
property arising out of acts occurring, products sold
or services rendered prior to the Closing Date.
2.2.7 Any liabilities arising out of or in connection with
any violation of any federal, state or local government
statute or rule, regulation or directive, or arising
out of any release or disposal of any hazardous or
toxic substance, including without limitation a
"hazardous substance" as defined in 42 U.S.C.
9601(14) and oil, gasoline and other petroleum-based
substances, which violation, release or disposal
occurred prior to the Closing Date.
2.2.8 Any liabilities for legal, accounting, audit and other
professional fees incurred by Seller with respect to
the preparation and negotiation of this Agreement or
any document or other agreement related thereto.
2.2.9 Any liability to, or on account of, any employee
benefit plan of Seller, any of its Affiliates or any
predecessor employer of any employee, including, but
not limited to any health and medical, sick pay,
severance, long term disability, pension, retirement,
savings, Section 401(k), stock option and/or deferred
compensation plan or arrangement, whether written or
oral and whether "qualified" or "non-qualified" under
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the Internal Revenue Code of 1986, as amended, or to
any employee as a result of or following upon the
consummation of the transactions contemplated herein.
2.2.10 Any liabilities of Seller to the extent that their
existence or magnitude constitutes or results in a
breach of a representation, warranty or covenant of
Seller in this Agreement.
ARTICLE 3
PURCHASE PRICE
3.1 Purchase Price: Time of Payment. In addition to assumption of the
Assumed Liabilities, as expressly stated herein, the Buyer shall
provide the following consideration to Seller:
a) Cash Payment. A cash payment at Closing of twenty-five thousand
dollars ($25,000);
b) Stock of Buyer. Buyer shall cause to be issued in the name of the
Seller, Six Million (6,000,000) restricted shares of its common
stock on the Closing Date pursuant to the terms of the Subscription
Agreement attached hereto as Exhibit 3.1(the "Securities"). The
Securities shall be issued pursuant to applicable state and federal
securities laws exemptions and shall contain an appropriate legend
restricting their transferability.
c) Merger of Buyer into Public Shell. Within forty-five (45) days
after the Closing, Buyer agrees to either merge into, or become a
wholly owned subsidiary of (the "Merger"), Hallmark Properties,
Inc. a Colorado public shell corporation ("Hallmark"). Buyer
further agrees that, as a result of a reverse split or other
adjustment, Seller will, immediately after the Merger, own 6/7ths
or 85.71% of the then issued and outstanding shares of stock in
Hallmark. Nothing herein shall prohibit Hallmark from thereafter
issuing additional shares of its stock for fair consideration
pursuant to a subsequent registered or exempt offering. Buyer
agrees that Buyer's failure to comply with the terms of this
section 3.1(c) shall be deemed a material default and Seller shall
have the immediate right to declare this Agreement null and void
with full right to rescind the transfers of the Purchased Assets
made hereunder.
3.2 Allocation of Purchase Price. The Purchase Price shall be
allocated among the Purchased Assets ( including the
liabilities assumed) either in the manner set forth on the
attached Exhibit 3.2 (or as approved in writing by the parties
hereto at or after Closing) for all purposes and each of the
parties shall file with the Internal Revenue Service Form 8594
on a basis consistent therewith.
3.3 Further Assurances. Each of the parties hereto, before, at and
after the Closing, upon the request from time to time of any other
party hereto and without further consideration, shall do each and
every act and thing as may be necessary or reasonably desirable to
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consummate the transactions contemplated hereby and to effect an
orderly transfer to Buyer of the Purchased Assets.
ARTICLE 4
CLOSING
4.1 Binding Nature of Agreement. The sale contemplated by this
Agreement shall be a legally binding obligation of the parties hereto
upon execution thereof by officers of the respective parties, subject
only to rescission by the affirmative vote of a majority of the
shareholders of Seller. The Seller hereby agrees and warrants to
deliver, on or before Closing, either by irrevocable proxy or vote at
a duly called and noticed shareholder meeting, the affirmative vote
of at least a majority of the shareholders of the Seller approving
the sale contemplated by this Agreement.
4.2 Time and Place of Closing. The closing of the transactions
contemplated hereby (the "Closing") shall take place at the offices
of Xxxxxxx & Xxxxxxx, LLC, 00 Xxxxx Xxxxx Xxxxxx, Xxxxx 000,
Xxxxxxxxxxx, Xxxxxxxxx 00000, on April 16, 1999 at 2:00 p.m. or at
such other place or on such other date which the parties may mutually
agree in writing ("Closing Date"). All transfers and other proceedings
required to be made or taken at the Closing shall be deemed to have
taken place simultaneously, and no delivery shall be considered to
have been made until all such proceedings have been completed. Legal
title, equitable title and risk of loss with respect to the Purchased
Assets shall be deemed to have passed to Buyer on transfer of such
Purchased Assets on Closing.
4.3 Seller's Deliveries At Closing. At the Closing, Seller shall
deliver to Buyer the following:
(a) A release of each existing security interest of record
relating to the Purchased Assets, which is not expressly
assumed by Buyer;
(b) Any Xxxx of Sale document reasonably requested by the Buyer
evidencing the transfer of any tangible assets transferred
hereby and such deeds (together with affidavits of title),
assignments, certificates of title, and other instruments of
conveyance as Buyer shall reasonably require to convey to
Buyer the Purchased Assets, including, without limitation,
assignments of any Proprietary Rights included in the
Purchased Assets;
(c) A fully executed Subscription Agreement in the form attached
hereto as Exhibit 3.1;
(d) Any consents from third parties, including but not limited
to, secured parties listed on Exhibit 2.1.3 required to
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permit Buyer to obtain the benefits of all the Purchased
Assets under the same terms and conditions as are applicable
to Seller and to prevent a breach of any agreement or
security interest relating to the Purchased Assets. In
addition, Seller shall deliver to Buyer, from time to time,
such documentation as Buyer may reasonably request to assure
Buyer the benefit of any of the Purchased Assets for which
consents were not required;
(e) A certificate executed by the CEO or Secretary of Seller, in
form satisfactory to Buyer and the Buyer's counsel, setting
forth the resolutions adopted by the Board of Directors and
shareholders of Seller authorizing the execution of this
Agreement and the taking of any and all actions deemed
necessary or advisable to consummate the transactions
contemplated hereby;
(f) The books and records of the Business, which may be
delivered by Seller at an alternative location to the
location of the Closing upon the written agreement of
Seller and Buyer;
(g) All other documents, instruments and writings required by
this Agreement or reasonably requested by Buyer to be
delivered at Closing; and,
Seller further agrees, before, at and after the closing upon reasonable
request by Buyer, and without additional consideration, to execute any
additional documentation reasonably necessary to transfer the Purchased
Assets to Buyer.
4.4 Buyer's Deliveries At Closing. At the Closing, Buyer shall
deliver to Seller the following:
(a) One or more stock certificates duly approved and executed
by authorized representatives of the Buyer evidencing the
shares of Buyer to be delivered pursuant to Section 3.1
hereof; and,
(b) A certificate from the Secretary of Buyer, in a form
reasonably satisfactory to Seller and Seller's counsel,
setting forth the resolutions adopted by the Board of
Directors of Buyer authorizing the execution of this
Agreement and the taking of any and all actions deemed
necessary or advisable to consummate the transactions
contemplated hereby.
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ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Buyer as of the Closing Date as
follows:
5.1 Organization: Power and Authority. Seller is a corporation
duly organized, validly existing and in good standing under
the laws of the State of Minnesota, and has all requisite
power and authority to execute, deliver and perform its
obligations under this Agreement and to consummate the
transactions contemplated hereby. Seller has full corporate
power and authority to carry on the Business as it is now
being conducted and to own, license, lease and operate the
Purchased Assets.
5.2 Due Authorization and Execution: Effect of Agreement. The
Board of Directors and shareholders of Seller have taken all
action required by law, its Articles of Incorporation, its
Bylaws or otherwise to authorize the execution and delivery of
this Agreement and the transactions contemplated hereby and no
other corporate action is necessary to authorize the execution
and delivery hereof or the consummation of the transactions
contemplated hereby.
5.3 Litigation Involving Seller. Except as disclosed in Exhibit 5.3,
and except as qualified by Section 5.6 below, there is no action,
suit, proceeding or investigation pending (including, without
limitation, any action, suit, proceeding or investigation with
respect to any federal, state or local laws, rules or regulations),
or to Seller's knowledge, threatened against or detrimentally
affecting Seller, or any of the Purchased Assets which could
materially and adversely affect the Business or any of the Purchased
Assets and no governmental entity has served upon Seller any notice
claiming any violation of any statute, ordinance, or regulation or
noting the need for any repair or remediation with respect to the
Purchased Assets, requesting data or access, requiring testing or
other investigation relating to environmental conditions or requiring
any change in the Purchased Assets or in Seller's means or method of
conducting the Business.
5.4 Consents. No consent, approval or authorization of, exemption by,
or filing with, any governmental or regulatory authority or any third
party is required in connection with the execution, delivery or
performance by Seller of this Agreement and the consummation of the
transactions contemplated hereby.
5.5 Financial Information. Seller has furnished Buyer with true and
complete copies of Seller's financial statements and other financial
information with respect to the Business for the periods ending prior
to the date hereof (the "Financial Statements"). The Financial
Statements are preliminary and unaudited but otherwise present fairly,
in all material respects, the financial position of the Seller and the
results of its operations as of the respective dates and periods
thereof in conformity with generally accepted accounting principles
("GAAP"). Seller has no liabilities or obligations with respect to
the Business of any nature (absolute, accrued, contingent or
otherwise) which are not reflected or reserved against on the
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Financial Statements, except as referred to herein or for commercial
liability and obligations incurred in the ordinary course of business
and consistent with past practice since the date thereof.
5.6 Disclosure of Defaults. Seller has disclosed that it is in default
under various contracts or with respect to various creditors.
Notwithstanding the above, there are no undisclosed pending
foreclosure actions involving the Purchased Assets and since at least
April 1, 1998 Seller has not sold any material assets of the Business,
except in the ordinary course of its business.
5.7 Compliance with Applicable Laws. To the best of its knowledge,
Seller is in compliance with all federal, state and local and foreign
laws, statutes, rules and regulations applicable to Seller, the
Business and the Purchased Assets. Except as disclosed in writing in
an exhibit attached to this agreement, Seller has, to the best of its
knowledge, conducted the Business in compliance with all federal,
state, local and foreign laws, statutes, rules and regulations
applicable to Seller, the Business and the Purchased Assets.
5.8 Title to Purchased Assets. Seller has (or, as of the Closing, will
have) or is entitled to good and marketable title to the Purchased
Assets free and clear of all liens, security interests, mortgages,
pledges or other encumbrances other than the Assumed Liabilities
expressly assumed by Buyer hereunder.
5.9 Use and Condition of Property. To the best of Seller's knowledge,
the tangible Purchased Assets are in operating condition and repair,
ordinary wear excepted, are fit and usable for the purposes for which
they are being used, conform to all applicable laws and regulations
and no notice of any violation of any law, statute, ordinary or
regulation relating to any such property or assets has been received
by Seller. Provided, however, that those Purchased Assets under
development or construction are in various stages of development or
completion.
5.10 Accounts Receivable. The Account Receivables reflected on
the Financial Statements and all the Accounts Receivable
arising after such dates are valid and genuine and arose from
bona fide transactions in the ordinary course of the Business
and have been recorded in accordance with GAAP. No Accounts
Receivable included in the Purchased Assets have been assigned
or pledged to any third party (except for such security
interests of which shall be expressly assumed by Buyer at
Closing pursuant to the terms hereof) and the account obligors
have not asserted a defense or setoff to any such Account
Receivable included in the Purchased Assets.
5.11 Intellectual Property Rights. Seller owns those Proprietary
Rights used in the Business and as set forth in the Exhibit
5.11 and as otherwise disclosed herein. Except as otherwise
disclosed in writing by Seller, the Proprietary Rights of
Seller are not subject to any outstanding orders, decrees,
judgments stipulations, claims or settlements nor is any item
of such Proprietary Rights subject to any mortgage, license,
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option, lease, covenant, condition, agreement, lien, security
interest, adverse claim, restriction, charge or encumbrance
except the Assumed Liabilities, the potential solicitor's lien
of the law firm of Xxxxxxx & Xxxxx and claims brought by Xx
Xxxxxxx, Melling Design Consultancy or MCD Limited.
Furthermore, there are no pending or threatened claims,
proceedings or lawsuits relating to, affecting or otherwise
impairing the Seller's rights in the Proprietary Rights.
Notwithstanding the above, Buyer acknowledges that various
trademark applications may be subject to government and/or
public inquiries and oppositions.
To the Seller's knowledge, there are no facts that would be
detrimental to the ownership, use or validity of any of the
Proprietary Rights. On or after the execution of this
Agreement, there will be no licenses or rights granted to any
other person or entity with respect to any such Proprietary
Rights except for any rights of Heidelberg Typing and Desktop
Publishing under its agreement with Seller dated December 1,
1998.
Further, Seller is not, to the best of its knowledge,
infringing upon or violating any intellectual property rights
of any other person or entity in the conduct of the Business.
5.12 Taxes. Seller has filed, or will file before Closing, in proper
form all federal, state, local and foreign tax returns required to be
filed prior to the date hereof which relate to the Purchased Assets or
to the Business.
5.13 No Liability For Employee Benefits. Buyer will incur no liability
to, or on account of any employee benefit plan of Seller, any of its
Affiliates or any predecessor employer of any employee.
5.14 Permits, etc. All permits, licenses, registrations and approvals of
and from all governmental authorities necessary for the operation by
Seller of the Business and the Purchased Assets, if any, and are in
full force and effect, and are readily transferable to Buyer without
the consent of any such governmental authority or other third party.
5.15 Brokers, Finders, etc. All negotiations relating to this Agreement
and the transactions contemplated hereby have been carried on without
the intervention of any person acting on behalf of Seller in such
manner as to give rise to any valid claim against Seller or Buyer for
any brokerage or finder's commission, fee or similar compensation.
5.17 Investment Intent. The Seller intends to acquire and hold
the shares of stock issued hereunder (the "Securities") for
its own account and for investment purposes only, and not with
a view to, or for resale in connection with, the distribution
thereof within the meaning of the Securities Act of 1933, as
amended (the "Act The Seller recognizes (i) that an investment
in the securities involves a high degree of risk, and that
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such risks may result in the loss of the total amount of this
investment; (ii) that the purchase of the Securities is a long-
term investment; (iii) that transferability and sale of the
Securities is restricted in many ways; (iv) that the Buyer
makes no representations whatsoever concerning the present or
prospective value of the Securities; and (v) that in the event
of disposition of the Securities, the undersigned could
sustain a total loss of its investment.
The Seller acknowledges that the Securities have not been
registered under the Act and that the Securities may not be
sold, assigned or otherwise transferred (i) except pursuant to
an effective registration statement under the Act and
applicable State securities laws or (ii) unless the Seller
supplies the Buyer with an opinion of an attorney of the
undersigned's choosing to the effect that the proposed sale,
assignment or other transfer is exempt from registration under
applicable federal and state securities laws. As a result
thereof, the Seller may be required to hold the Securities for
an indefinite period of time.
The Seller acknowledges that its agents and advisors have been
afforded the opportunity to examine all books, records,
agreements and other documents relevant to the Buyer and these
Securities and that it has been given an opportunity to ask
questions and receive answers from duly designated
representatives of the Buyer concerning its investment in the
Securities.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby represents and warrants to Seller as follows:
6.1 Organization: Power and Authority. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of
the State of Minnesota, and has all requisite power and authority to
carry on its business as it is now being conducted, to execute,
deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby.
6.2 Due Authorization and Execution: Effect of Agreement. The
execution, delivery and performance by Buyer of this Agreement and
the consummation of Buyer of the transactions contemplated hereby have
been duly authorized by all necessary corporate action required to be
taken on the part of Buyer. This Agreement has been duly and validly
executed and delivered by Buyer and constitutes a valid and binding
obligation of Buyer, enforceable in accordance with its terms.
6.3 Consents. No consent, approval or authorization of exemption by, or
filing with, any governmental or regulatory authority or any other
third party is required in connection with the execution, delivery or
performance by Buyer of this Agreement, except for consents,
approvals, authorizations, exemptions and filings, if any, which: (a)
have been, or by the Closing Date will be, obtained; and (b) Seller
is required to obtain or make.
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6.4 Brokers, Finders, etc. All negotiations relating to this Agreement
and the transactions contemplated hereby have been carried on without
the intervention of any person acting on behalf of Buyer in such
manner as to give rise to any valid claim against Seller or Buyer for
any brokerage or finder's commission, fee or similar compensation.
ARTICLE 7
CONDITION PRECEDENT TO BUYER'S PERFORMANCE
The obligations of Buyer are subject to the fulfillment, prior to or on
the Closing Date, of each of the following conditions:
7.1 Accuracy of Representations and Warranties. All representations
and warranties by the Seller in this Agreement shall be true and
correct on and as of the Closing Date.
7.2 Seller's Compliance. Seller shall have performed, satisfied and
complied with all covenants, assignments, agreements and conditions
required by this Agreement to be performed or complied with by Seller.
ARTICLE 8
CONDITIONS PRECEDENT TO SELLER'S PERFORMANCE
The obligations of Seller under this Agreement are subject to the
satisfaction, on or before the Closing Date of the following conditions.
8.1 Accuracy of Representations and Warranties. All representations
and warranties by the Buyer in this Agreement shall be true on and
as of the Closing Date.
8.2 Compliance by Buyer. The Buyer shall have performed, satisfied and
complied with all covenants, agreements and conditions required by
this Agreement to be performed or complied with by the Buyer.
ARTICLE 9
INDEMNIFICATION
9.1 Indemnification by Seller. Seller hereby agrees to indemnify and
hold the Buyer, its affiliates, and its employees, officers, directors
and agents harmless from, against and in respect of (and shall on
demand reimburse the Buyer for) any and all losses, liabilities,
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damages, claims, costs and expenses (whether or not arising out of
third party claims, including without limitation interest, penalties
and reasonable attorneys' fees) sustained or incurred by the Buyer
in connection with or arising out of:
(a) any untrue representation, breach of warranty, or
nonfulfillment of any covenant by Seller contained herein;
or,
(b) any liabilities or obligations of Seller not specifically
assumed by the Buyer pursuant to the terms of this
Agreement.
9.2 Indemnification by the Buyer. The Buyer shall indemnify and hold
Seller harmless from and against any and all liabilities incurred in
connection with or arising out of any untrue representation, breach
of warranty or nonfulfillment of any covenant by the Buyer contained
herein.
ARTICLE 10
TRANSFER OF INTELLECTUAL PROPERTY RIGHTS
Notwithstanding other obligations of the parties hereunder the parties
expressly agree as follows:
10.1 Change of Corporate Name. Immediately after the Closing, the
Seller shall take such action as may be required to change its
corporate name to one that will not include the name "Norton" (or
other trademark transferred hereby) or otherwise imply a relationship
or sponsorship of Buyer. Immediately after the Closing Buyer shall
forthwith be entitled to change its corporate name to Norton Motors,
Inc. or such other name it shall in its sole discretion choose,
including, but not limited to any name incorporating the name "Norton"
(or other trademark transferred hereby.)
10.2 Transfer of Trademarks and other Intellectual Property Rights.
Contemporaneously with the Closing or thereafter, at the request of
Buyer and without additional consideration therefore, Seller shall
sign all documents necessary to transfer all trademark rights owned
by Seller to the Norton name as well as all other intellectual
property rights transferred hereunder.
ARTICLE 11
DEFAULTS AND REMEDIES
11.1 Event of Default. Any of the following events shall constitute an
"Event of Default" under this Agreement:
(a) The Buyer shall not pay when due the monetary consideration
or issue the stock as required by Article 3.1 of this
Agreement;
(b) The Seller shall fail to take any action required hereunder
to transfer any of the Purchased Assets to Buyer; or,
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(c) Any representation made by the Buyer or Seller in this
Agreement or in any document made collateral to this
Agreement shall prove to be untrue in any material respect
or materially misleading at the time such representation or
warranty was made.
11.2 Notice of Default. Upon the occurrence of one of the defaults
described in this Agreement, the non-breaching party shall give
written notice to the other specifying:
(a) the default;
(b) the action required to cure the default;
(c) if applicable, a date not less than thirty (30) days
from the date the notice is mailed to the party in which
such default must be cured; and
(d) that failure to cure such default on or before the date
specified in the notice shall result in the non-breaching
exercising its remedies at law or as specified in this
Agreement.
11.3 Remedies. Upon the occurrence of an Event of Default,
the non-breaching party, shall be entitled to bring an action
for all remedies to which it might by law be entitled.
11.4 Remedies Not Exclusive. No right or remedy by this
Agreement or by any document or instrument delivered by a
party hereto, shall be or is intended to be exclusive of any
other right or remedy, and each and every right and remedy
shall be cumulative and in addition to any other right or
remedy now or hereafter existing at law or in equity or by
statute.
11.5 Waiver; Forbearance. Except as the parties may hereafter
otherwise agree in writing, no waiver by a party of any breach
or default of the other party, of any of its obligations,
agreements or covenants under this Agreement shall be deemed
to be waiver of any subsequent breach of the same, or any
other obligation, agreement or covenant under this Agreement,
nor shall forbearance by a party to seek a remedy for such
breach be deemed a waiver of its rights and remedies with
respect to such breach, nor shall a party be deemed to have
waived any of its rights and remedies unless it be in writing
and executed with the same formality as this Agreement.
ARTICLE 12
MISCELLANEOUS
12.1 Survival. The representations and warranties made in this
Agreement or in any certificate or other document delivered
pursuant hereto or in connection herewith and the covenants
and agreements contained herein to be performed or complied
with at the Closing, prior to the Closing Date or in
connection with the Closing shall survive the Closing and the
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purchase and sale of the Purchased Assets contemplated hereby.
12.2 Entire Agreement: Amendment. This Agreement, including the
Exhibits and other writing referred to herein or delivered
pursuant to this Agreement constitutes the sole understanding
of the parties with respect to the subject matter hereof and
it supercedes all prior oral or written agreements,
commitments or understandings with respect to the matters
provided for herein. No amendment, modification or alteration
of the terms or provisions of this Agreement shall be binding
unless the same shall be in writing and duly executed by the
parties hereto.
12.3 Successors and Assigns. The terms and conditions of this
Agreement shall inure to the benefit of and be binding upon
the respective successors and assigns of the parties hereto;
provided, however, that this Agreement may not be assigned by
any party without the express prior written consent of the
other party hereto. If this Agreement is assigned with such
consent the terms and conditions hereof shall be binding upon
and shall inure to the benefit of such assignee; provided,
however, that no assignment of this Agreement or any of the
rights or obligations hereof shall relieve any party of its
obligations under this Agreement.
12.4 Counterparts. This Agreement may be executed in counterparts,
each of which shall, for all purposes, be deemed to be an
original and all of which taken together shall constitute the
same instrument.
12.5 Headings. The headings of the Articles, Sections and
paragraphs of this Agreement are inserted for convenience only
and shall not be deemed to constitute part of this Agreement
or to affect the construction hereof.
12.6 Waiver. Any of the terms or conditions of this Agreement may
be waived in writing at any time by the party which is
entitled to the benefits thereof. No waiver of any of the
provisions of this Agreement shall be deemed or shall
constitute a waiver of such provisions at any time in the
future or a waiver of any other provision hereof.
12.7 Expenses. Seller and Buyer shall each pay all costs and
expenses incurred by themselves or on their behalf in
connection with this Agreement and the transactions
contemplated hereby, including without limitation, fees and
expenses of their own financial consultants, accountants and
counsel.
12.8 Notices. Any notice, request, instruction, consent or other
document to be given hereunder by any party hereto to any
other party shall be in writing and delivered personally or
sent by registered or certified mail, postage prepaid, and
shall be deemed given when postmarked and addressed as
follows:
If to Buyer: Norton Acquisition Corporation ______
B.A. Johnson__________ 00 Xxxxx Xxxxx Xxxxxx
00
Xxxxx 000
Xxxxxxxxxxx, XX 00000
with a copy to: Xxxxxxx & Xxxxxxx, LLC
00 Xxxxx Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxx
If to Seller: Norton Motors International Inc.
00000 - 00xx Xxxxxx Xxxxx
Xxxxxxxx, XX 00000-0000
with a copy to: Norton Motors Department
c/o Aquilini Investment Group
ATTN : Xxxxx Xxxxx
Standard Building-Main Level
510 West Hastings
Xxxxxxxxx, XX X0X 0X0
or at such other address for a party as shall be specified by
like notice. Any notice which is delivered personally in the
manner provided herein shall be deemed to have been duly given
to the party to whom it is directed upon actual receipt by
such party or its agent for notices hereunder.
12.9 Governing Law. This Agreement shall be construed in accordance
with and governed by the laws of the State of Minnesota.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed on its behalf as of the date first above
written.
Buyer: NORTON ACQUISITION CORPORATION
------------------------------
By: /s/ X.X. Xxxxxxx
Its: President
15
Seller: NORTON MOTORS INTERNATIONAL INC.
--------------------------------
By: /s/ Xxxx Xxxxxxxxx /s/ Xxxxx Xxxxx
Its: CFO and CEO
16
INDEX TO EXHIBITS
Exhibit 1.1 Purchased Assets
Exhibit 1.1(B) Additional Transferred Rights
EXHIBIT 1.2 Excluded Assets
Exhibit 2.1.2 Trade Accounts Payable
Exhibit 2.1.3 Secured Liabilities
Exhibit 2.1.4 Liabilities Assumed from the Norton Agreement
Exhibit 3.1 Subscription Agreement
Exhibit 3.2 Allocation of Purchase Price
Exhibit 5.3 Litigation or Claims Involving Seller
Exhibit 5.11 Intellectual Property Rights
17
