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EXHIBIT 10.14
CONTRIBUTION AND ACQUISITION AGREEMENT
This CONTRIBUTION AND ACQUISITION AGREEMENT (the "Agreement") is made
as of this 3rd day of February 1999 by and between COLLECTORS UNIVERSE, INC., a
Delaware corporation ("CUI") and XXXX XXXXXXXXX ("Xxxxxxxxx"), with reference to
the following facts and circumstances:
R E C I T A L S
X. Xxxxxxxxx is the record and beneficial owner of 40% of the
membership interests in Superior Sportcard Auctions, LLC, a Delaware limited
liability company ("SCA"), that is engaged in the business of marketing and
selling Sports Collectibles (as hereinafter defined), at in-person and
telephonic auctions and auctions conducted over the internet or by other means
of electronic commerce (the "SCA Business").
X. XXX has been formed, organized and capitalized under the laws of the
State of Delaware for the purposes of effecting the transactions contemplated in
this Agreement and the other agreements listed on Exhibit A hereto (the "Other
Contribution Agreements") and to conduct such other business and affairs as the
Board of Directors of CUI may from time to time find to be in the best interests
of CUI.
C. Each of the corporations or other business entities whose shares,
ownership interests or assets are being contributed to CUI pursuant to this
Agreement and or the Other Contribution Agreements (hereinafter sometimes
referred to collectively as the "Founding Companies") is engaged in the business
of marketing and selling, or providing services to, businesses that market and
sell, Collectibles (as hereinafter defined) at retail establishments, by mail
order, at trade shows or auctions or over the internet or by other means of
electronic commerce. CUI intends to integrate the products and services offered
by each of the Founding Companies in order to expand the sale of their products,
increase their efficiencies and reduce their operating costs and increase their
presence and expand their sales over the Internet.
X. XXX desires to acquire the Membership Interests in SCA owned by
Bussineau (the "Bussineau Membership Interest") and Bussineau desires to
contribute and transfer and convey the Bussineau Membership Interest to CUI, in
exchange for which CUI would issue to Bussineau shares of CUI Common Stock, all
on the terms and conditions set forth herein, at or about the same time as and
in conjunction with the consummation of the similar transactions contemplated by
the Other Contribution Agreements.
E. This Agreement is being entered into by the parties, and the Other
Contribution Agreements are being or have been entered into by CUI and the other
parties thereto, as part of a unified plan of contribution and exchange of stock
(the "Plan") that is intended by the parties to qualify for non-recognition
treatment under Section 351 of the Internal Revenue Code of 1986, as amended
(the "Code"). However, none of the parties to this Agreement nor any of the
parties to the Other Contribution Agreements has made or is making any
representations or warranties with respect to whether the transactions being
consummated pursuant to and as part of such Plan will comply with the
requirements of Code Section 351 or as to the consequences, under applicable
federal, state or other tax laws, of such transactions to the parties to this
Agreement.
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NOW, THEREFORE, in consideration of the foregoing and the respective
covenants and promises of each of CUI and Bussineau to the other that are
hereinafter set forth, the parties agree as follows:
1. EXCHANGE OF SECURITIES.
1.1 CONTRIBUTION OF BUSSINEAU MEMBERSHIP INTEREST. On the
terms and subject to the conditions contained in this Agreement, at the Closing
(as hereinafter defined) Bussineau shall contribute, assign, transfer, xxxxx and
deliver the Bussineau Membership Interest to CUI, free and clear of any and all
liens, claims, encumbrances, pledges, security interests, options, rights of
first refusal, community property interests, restrictions and any other adverse
interests of any kind or nature whatsoever, and CUI shall acquire and accept the
Bussineau Membership Interest from Bussineau.
1.2 CONSIDERATION. As the consideration for the contribution
and transfer to CUI of the Bussineau Membership Interest, at the Closing (as
hereinafter defined), CUI shall issue to Bussineau a total of Six Hundred Thirty
One Thousand Seven Hundred Eighteen (631,718) shares of common stock of CUI (the
"CUI Shares"), against delivery by Bussineau of the instruments and documents
referenced in Section 1.3 hereof.
1.3 CLOSING. Subject to the satisfaction or waiver of the
conditions set forth in Section 5 hereof, consummation of the transactions
contemplated hereby (the "Closing") shall take place at the offices of Xxxxxxxxx
Xxxxx Xxxxxxx & Xxxxx, 000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx Xxxxx,
Xxxxxxxxxx 00000, on the third (3rd) business day after satisfaction or waiver
of such conditions precedent, provided, however, that, if the Closing occurs on
or before March 12, 1999, the transactions contemplated hereby shall be
effective for accounting purposes as of February 5, 1999 (the "Effective Date").
At the Closing, Bussineau shall execute and deliver to CUI (i) such documents or
instruments of assignment as CUI or its counsel may reasonably request to
evidence and effectuate the transfer of the Bussineau Membership Interest to CUI
in accordance with the terms of this Agreement, (ii) a stockholders agreement in
the form of Exhibit B hereto (the "Stockholders Agreement") and (iii) a
Non-Competition Agreement in the form of Exhibit C hereto (the "Non-Competition
Agreement"), and CUI shall execute and deliver to Bussineau a stock certificate
evidencing his ownership of the CUI Shares.
1.4 WAIVER OF RIGHT OF PURCHASE OPTION. The parties hereto
agree to cooperate with each other to cause SCA to waive its right of first
refusal and purchase option with respect to the Bussineau Membership Interest
under Section 8.2 of the SCA's Amended and Restated Operating Agreement dated as
of March 1996 (the "Operating Agreement").
2. REPRESENTATIONS AND WARRANTIES OF BUSSINEAU. Bussineau represents
and warrants to CUI as follows:
2.1 AUTHORITY AND CAPACITY. Bussineau has the full legal right
and capacity to execute and deliver, and to perform his obligations under, and
has duly executed and delivered, this Agreement on the date hereof, with the
intent to be legally bound hereby and thereby. This Agreement constitutes, and
when executed and delivered by Bussineau at the Closing, each of the
Stockholders Agreement and the Non-Competition Agreement will constitute, a
valid and legally binding obligation of Bussineau that is enforceable against
him in accordance with its respective terms, except as such enforceability may
be limited by bankruptcy, insolvency, moratorium or other similar laws affecting
creditors' rights and by general principles of equity relating to the
availability of equitable remedies
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(regardless of whether any such agreements are sought to be enforced in a
proceeding at law or in equity).
2.2 NO CONFLICTS. The execution and delivery and the
performance by Bussineau of this Agreement, the Stockholders Agreement and the
Non-Competition Agreement do not and will not require any consent or approval of
any third party (governmental or other) that has not been obtained and will not
result in any of the following: (i) a termination of, or a default or breach
under, or an event that, with notice or lapse of time, or both, would be a
default or breach under, any contract, lease, license, promissory note, security
or pledge agreement, or any other agreement, instrument or commitment to which
Bussineau is a party or is subject; (ii) acceleration of any indebtedness owed
by Bussineau or the creation or imposition of any liens, charges or encumbrances
on the Bussineau Membership Interest or any of Bussineau's assets; or (iv) a
violation or breach of any writ, injunction or decree of any court or
governmental instrumentality or any laws to which Bussineau is a party or to
which he or the Bussineau Membership Interest is subject.
2.3 THE BUSSINEAU MEMBERSHIP INTEREST.
(a) Bussineau has good and marketable title to the
Bussineau Membership Interest, free and clear of any and all liens, claims,
encumbrances, pledges, security interests, options, rights of first refusal,
community property interests, restrictions and any other adverse interests of
any kind or nature whatsoever, other than restrictions on the transferability
and rights of first refusal that are imposed on the Bussineau Membership
Interest by SCA's Operating Agreement. Bussineau has not sold, transferred,
conveyed, assigned, hypothecated, or granted any security interest in or
pledged, or granted any option or right entitling anyone to acquire, the
Bussineau Membership Interest, and has not entered into nor is he bound by any
agreement, commitment or understanding (written or oral) to do any of the
foregoing. The Bussineau Membership Interest is not subject to any liabilities,
other than those expressly provided for in the SCA Operating Agreement, and no
liabilities will arise as a result of or in connection with the consummation of
the sale and transfer of the Bussineau Membership Interest by Bussineau to CUI.
(b) Except as otherwise set forth on Schedule 2.3 hereto,
neither Bussineau nor any corporation or other business entity in which
Bussineau may have a direct or indirect ownership interest, owns or has any
rights, title or interest in or to, any assets, either tangible or intangible
(and including any trademarks, trade names, copyrights, patents, inventions,
trade secrets, or any other intellectual property rights or assets) that are
used by SCA in or in the conduct of its business.
2.4 SECURITIES LAW COMPLIANCE. Bussineau represents and
warrants that:
(a) He has been advised and understands and agrees that
the CUI Shares will not be registered under the Securities Act of 1933, as
amended (the "1933 Act"), nor qualified under any state securities laws, on the
ground (among others) that no distribution or public offering of the CUI Shares
is to be effected in connection with the transactions contemplated herein or by
Bussineau and in issuing the CUI Shares to Xxxxxxxxx, XXX is relying on the
accuracy and completeness of the representations and warranties of Bussineau in
this Section 2.4.
(b) Bussineau is acquiring the CUI Shares for his own
account, and not as an nominee or agent for any other persons or entities, and
for investment and not with a view to distribution or resale thereof.
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(c) Bussineau acknowledges that he has been informed and
understands that no public market for the CUI Shares exists and that there can
be no assurance that any such market may develop or exist in the future and,
even if a public market does develop, that sales or other transfers of the CUI
Shares may be made only in compliance with the 1933 Act or any exemption
thereunder and there is no assurance that any exemption from registration,
including Rule 144, under the 1933 Act will become available to permit resales
of the CUI Shares or that CUI will satisfy the conditions to the availability of
such exemptions.
(d) Bussineau has been furnished with such information
regarding CUI and the CUI Shares as he has requested of CUI and has had an
opportunity to ask questions of the officers of CUI regarding, and to become
informed about, CUI and its business and its consolidated financial condition
and results of operations.
(e) Bussineau is an "Accredited Investor" as such term is
defined in Regulation D under the 1933 Act.
(f) Bussineau acknowledges and agrees that (i) until the
CUI Shares become eligible for resale under Rule 144(k) under the 1933 Act, any
proposed sale or other transfer or disposition of any of the CUI Shares, other
than pursuant to an effective registration statement under the 1933 Act, may not
be made unless and until Bussineau has furnished to CUI an opinion of counsel,
reasonably acceptable to CUI and its counsel, to the effect that the proposed
sale or other transfer or disposition is exempt from registration under the 1933
Act, and (ii) the CUI Shares will be subject to the Stockholders Agreement
referred to in Section 1.3 hereof and, until the Stockholders Agreement has been
terminated (A) no sale or other disposition of the CUI Shares may be made except
in compliance therewith and (B) the CUI Shares may be required to be sold in one
or more transactions involving sales of shares of CUI initiated by certain other
of the CUI Stockholders, all as more fully provided in the Stockholders
Agreement. Bussineau has read and understands the Stockholders Agreement.
(g) Bussineau acknowledges and agrees that the certificate
representing the CUI Shares shall contain restrictive legends in the forms set
forth in the form of Stockholders Agreement attached hereto as Exhibit B or
restrictive legends that are substantially similar thereto.
2.5 ACKNOWLEDGEMENTS AND AGREEMENTS REGARDING CUI
REPRESENTATIONS. Bussineau acknowledges and agrees that:
(a) Neither CUI nor any of its officers, employees or
agents has made, and none of them is making, any representations or warranties
to Bussineau with respect to (i) the federal, state or local income or other tax
consequences to Bussineau of his consummation of the transactions contemplated
hereby, or (ii) the future performance of CUI; and
(b) In entering into this Agreement, the Stockholders
Agreement and the Non-Competition Agreement, he is not relying on any statements
or representations or warranties of CUI, or any representations or warranties
made or purported to have been made by any officer, director, stockholder,
employee or agent of CUI, other than the express representations and warranties
of CUI contained in this Agreement; and
(c) He has relied on the advice of his own professional
advisors with respect to the foregoing matters.
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3. REPRESENTATIONS AND WARRANTIES OF CUI. CUI makes the following
representations and warranties to Bussineau as of the date of this Agreement:
3.1 ORGANIZATION. CUI is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.
3.2 CORPORATE POWER. CUI possesses the requisite corporate
power and authority to enter into and perform its obligations under this
Agreement. CUI has taken all corporate action and obtained all consents
necessary to authorize its execution and delivery of and its performance under
this Agreement. This Agreement constitutes, and upon its execution and delivery
by CUI the Stockholders Agreement will constitute, valid obligations of CUI that
are legally binding on and enforceable against CUI in accordance with their
respective terms, except (in each case) as such enforceability may be limited by
bankruptcy, insolvency, moratorium or other similar laws affecting creditors'
rights, and by general principles of equity relating to the availability of
equitable remedies (regardless of whether such agreements are sought to be
enforced in a proceeding at law or in equity).
3.3 NO CONFLICTS. The execution and delivery and the
performance by CUI of this Agreement and the Stockholders Agreement will not
result in any of the following: (i) the termination, or a default or an event
that, with notice or lapse of time, or both, would constitute a default, breach
or violation, of the Certificate of Incorporation or Bylaws of CUI, any
contract, lease, license, promissory note, security or pledge agreement, or
other agreement, instrument or commitment to which CUI is a party or is subject
and which is material to CUI and its subsidiaries considered as a whole; (ii)
the acceleration of the maturity of any indebtedness of CUI that is material to
CUI and its subsidiaries considered as a whole; or (iii) a violation or breach
of any writ, injunction or decree of any court or governmental instrumentality
to which CUI is a party or by which any of its properties is bound or any laws
or regulations applicable to CUI, where the violation would have a material
adverse effect on CUI and its subsidiaries, considered as a whole.
3.4 CERTIFICATE OF INCORPORATION AND BY-LAWS. CUI has
heretofore furnished to Bussineau or his counsel, a complete and correct copy of
its Certificate of Incorporation and By-Laws, as amended to date. Such
Certificate of Incorporation and By-Laws are in full force and effect. CUI is
not in violation of any of the provisions of its Certificate of Incorporation or
By-Laws.
3.5 CAPITALIZATION. As of the date hereof, the authorized
capital stock of CUI consists of 30,000,000 shares of Common Stock, par value
$.001 per share. On consummation of the transactions contemplated by this
Agreement and the Other Contributions Agreements, there will be (i) a total of
19,000,000 fully paid and nonassessable shares of Common Stock that will be
issued and outstanding, which will include the CUI Shares being issued under
this Agreement; and (ii) 3,250,000 shares of Common Stock reserved for issuance
on the exercise of stock options (either granted or to be granted in the
future).
3.6 FINANCIAL STATEMENTS. CUI has furnished to Bussineau
unaudited financial statements of Professional Coin Grading Service, Inc.
("PCGS") which, on consummation of the transactions contemplated hereby and by
the Other Contribution Agreements, will be CUI's predecessor and principal
subsidiary, consisting of a balance sheet of PCGS as of June 30,1998 and a
related statement of income for the year then ended, and an unaudited balance
sheet as of, and related unaudited statement of income of PCGS for the six
months ended, December 31, 1998, all of which have been prepared by PCGS
(collectively, the "PCGS Financial Statements"). Except as otherwise set forth
in Schedule 3.6 of the CUI Disclosure Schedules or in the footnotes contained in
the PCGS Financial Statements, such Financial Statements fairly present, in all
material respects, the financial position of
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PCGS as at, and the respective results of operations of PCGS for the year ended
June 30, 1998 and the six months ended December 31, 1998, respectively. Except
as set forth in Schedule 3.6 hereto, since December 31, 1998, there has not been
a material adverse change in the financial condition or results of operations of
PCGS.
3.7 THE CUI SHARES. The CUI Shares to be issued by CUI to
Bussineau pursuant to Section 1.2 of this Agreement shall be, at the time of
such issuance, duly authorized, validly issued, fully paid and non-assessable
and free of preemptive rights under the charter documents or other agreements of
CUI to which the shares of capital stock of CUI are subject, except for any
preemptive rights and rights of first refusal under the Stockholders Agreement.
4. ACTIONS TO BE TAKEN PENDING AND AFTER THE CLOSING
4.1 PROHIBITED ACTIONS. Between the date hereof and the
earlier of the consumation of the Closing or termination of this Agreement,
Bussineau agrees not to take any action which he knows, or reasonably should
know, would (i) make any of his respective representations or warranties
contained in this Agreement untrue or incorrect, or (ii) prevent or interfere
with the performance by Bussineau of any of his covenants contained in this
Agreement. Bussineau also covenants and agrees that he will not grant any
options or rights to acquire, or pledge or permit the imposition of any liens or
encumbrances on or hypothecate, the Bussineau Membership Interest either in
whole or in part, and he will not enter into any agreement or understanding,
written or oral, that provides therefor. Bussineau also agrees that, without the
approval of PCGS, he shall not make any material changes in SCA's business or
sell or hypothecate or grant any security interests, liens, or encumbrances on
any of the assets of SCA and he shall cause SCA's Business to be conducted only
in the ordinary course, consistent with past practice. Notwithstanding the
foregoing, however, the distribution to the owners of SCA, as of the day
preceding the Effective Date, of an amount in cash or promissory notes equal to
SCA's AAA account shall not constitute a breach of this Agreement.
4.2 ACCESS TO INFORMATION. During the period from the date
hereof and continuing until the earlier of the completion of the Closing or
termination of this Agreement, CUI, upon reasonable notice, and subject to the
provisions of Section 4.6 hereof, shall (i) furnish Bussineau and his
accountants, counsel and other representatives, reasonable access, during the
period between the date hereof and continuing until the earlier of the Closing
or termination of this Agreement, to all of CUI's and PCGS' properties, books,
contracts, commitments and records (ii) promptly furnish to Bussineau such other
information concerning the business, properties and personnel of CUI and PCGS as
Bussineau may reasonably request, and (iii) make available to Bussineau the
appropriate individuals (including attorneys, accountants and other
professionals) at CUI for a discussion of the business, properties and personnel
of CUI and PCGS as Bussineau may reasonably request.
4.3 CONSENTS; APPROVALS. Bussineau and CUI shall each use his
or its (as the case may be) best reasonable efforts to obtain all consents,
waivers, approvals, authorizations or orders (including, without limitation, all
governmental and regulatory rulings and approvals), and Bussineau and CUI shall
make all filings (including, without limitation, all filings with governmental
or regulatory agencies) required in connection with the authorization, execution
and delivery of this Agreement by and the consummation of the transactions
contemplated hereby. Bussineau and CUI shall furnish all information required to
be included in any applications or other filings to be made pursuant to the
rules and regulations of any governmental body in connection with the
transactions contemplated by this Agreement.
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4.4 NOTIFICATION OF CERTAIN MATTERS. Bussineau shall give
prompt notice to CUI, and CUI shall give prompt notice to Bussineau of (i) the
occurrence or nonoccurrence of any event which would be likely to cause any
representation or warranty made by such party in this Agreement to be materially
untrue or inaccurate, or (ii) any failure of the Bussineau or CUI materially to
comply with or satisfy any covenant, condition or agreement to be complied with
or satisfied by him or it (as the case may be) hereunder; provided, however,
that the delivery of any notice pursuant to this Section shall not limit or
otherwise affect the remedies available hereunder to the party receiving such
notice.
4.5 FURTHER ACTION. On the terms and subject to the conditions
hereof, each of the parties hereto shall use all reasonable efforts to take, or
cause to be taken, all actions, and to do, or cause to be done, all other things
necessary, proper or advisable to consummate and make effective as promptly as
practicable the transactions contemplated by this Agreement, to obtain in a
timely manner all necessary waivers, consents and approvals and to effect all
necessary registrations and filings, and otherwise to satisfy or cause to be
satisfied all conditions precedent to his or its (as the case may be)
obligations under this Agreement. From and after the Closing, each party shall
take such actions and execute such documents and instruments as the other party
may reasonably request to better evidence or effectuate the transactions
contemplated by this Agreement or the Exhibits hereto.
4.6 CONFIDENTIAL INFORMATION. Bussineau acknowledges that he
or any of his agents or advisors ("Representatives") may be given, by CUI or
PCGS (each, a "disclosing party") or any of such disclosing party's
Representatives, access to various items of proprietary and confidential
information of the disclosing party in the course of investigations and
negotiations prior to Closing. Bussineau agrees that such confidential
information shall be kept strictly confidential by him and his Representatives
and shall not be used for any purpose other than to facilitate the consummation
of the transactions contemplated herein. Confidential information shall include
any proprietary business or other information which is delivered (orally or in
writing) or to which access is given by a disclosing party or any of its
Representatives to Bussineau or any of his Representatives, and any such
information that is included in or incorporated into any notes, analyses,
memoranda, projections or other documents that are prepared by Bussineau or any
of his Representatives, unless such information (a) is already of public
knowledge, or (b) becomes of public knowledge through no fault, action or
inaction of the receiving party or its Representatives, or (c) is demonstrated
convincingly by Bussineau to have been known by him or any of his
Representatives prior to the disclosure of such information by the disclosing
party to him or his Representatives, unless such knowledge was acquired from a
person who Bussineau or his Representatives knew or reasonably should have known
was subject, at the time of such disclosure, to a fiduciary or other duty of
non-disclosure to the disclosing party. Except as permitted by Section 4.6,
neither Bussineau no nor his Representatives shall intentionally disclose any
confidential information of CUI or PCGS to any third person; provided, however,
that such information may be disclosed (i) with the written consent of CUI, (ii)
in applications or requests required to be made to obtain licenses, permits,
approvals or consents needed to consummate the transactions contemplated herein,
(iii) to Bussineau's professional advisors who need to know such information in
connection with the consummation of the transactions contemplated hereby, or
(iv) pursuant to court order or subpoena, provided, however, that if Bussineau
or any of his Representatives is served with a court order or subpoena that
would require the disclosure of any of the confidential information of a
disclosing party, Bussineau or such Representative so served (as the case may
be) shall promptly, but in any event within three (3) days thereafter, notify
CUI thereof and shall provide reasonable cooperation, at CUI's expense, with any
efforts that CUI may undertake to quash such court order or subpoena or obtain a
protective order with respect to the disclosure and use of such confidential
information. The restrictions and obligations contained in this Section 4.6
shall survive the consummation of the transactions contemplated hereby and any
termination of this Agreement.
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5. CONDITIONS PRECEDENT
5.1 CONDITIONS TO OBLIGATIONS OF EACH PARTY TO CONSUMMATE
TRANSACTIONS. The performance by each party of its respective obligations under
this Agreement shall be subject to the satisfaction, at or prior to the Closing
Date, of each of the following conditions unless waived in writing by such
party:
(a) Absence of Injunctions or Restraints; Illegality. No
temporary restraining order, preliminary or permanent injunction or other order
issued by any court of competent jurisdiction or other legal restraint or
prohibition preventing the consummation of the transactions contemplated hereby
shall be in effect, nor shall any proceeding brought by any administrative
agency or commission or other governmental authority or instrumentality,
domestic or foreign, seeking any of the foregoing be pending; and there shall
not be any action taken, or any statute, rule, regulation or order enacted,
entered, enforced or deemed applicable to the transactions contemplated hereby
which makes their consummation illegal.
(b) Governmental Actions. There shall not have been
instituted, pending or threatened, in writing, any action or proceeding (or any
investigation or other inquiry that might result in such an action or
proceeding) by any governmental authority or administrative agency before any
governmental authority, administrative agency or court of competent
jurisdiction, nor shall there be in effect any judgment, decree or order of any
governmental authority, administrative agency or court of competent
jurisdiction, in either case, seeking to prohibit or limit CUI, following the
Closing, from exercising any of the material rights and privileges pertaining to
its ownership of SCA or the ownership or conduct of its business.
(c) Consents Obtained. All material consents, waivers,
approvals, authorizations or orders required to be obtained by CUI, SCA or
Bussineau for the authorization, execution and delivery of this Agreement and
the consummation by each such party of the transactions contemplated hereby
shall have been obtained by CUI, SCA or Bussineau (as the case may be), except
where the failure to receive such consents, waivers, approvals, authorizations
or orders could not reasonably be expected to have a Material Adverse Effect on
the Business or CUI;
5.2 ADDITIONAL CONDITIONS TO OBLIGATIONS OF CUI. The
obligations of CUI to consummate its acquisition of the Bussineau Membership
Interest and to perform its other obligations under this Agreement also are
subject to the following conditions:
(a) Accuracy of Representations and Warranties. The
representations and warranties of Bussineau contained in this Agreement shall be
true and correct in all material respects on and as of the Closing Date, with
the same force and effect as if made on and as of the Closing Date, except for
(i) changes contemplated by this Agreement or by the Bussineau Disclosure
Schedules, and (ii) those representations and warranties which address matters
only as of a particular date (which shall have been true and correct as of such
date, and CUI shall have received a certificate to such effect signed by
Bussineau.
(b) Performance of Covenants. Bussineau shall have
performed or complied in all material respects with all agreements and covenants
required by this Agreement to be performed or complied with by him on or prior
to the Closing Date, including the execution and delivery of the Stockholders
Agreement and the Non-Competition Agreement, and CUI shall have received a
certificate to such effect signed by Bussineau.
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(c) Consummation of Other Transactions. The transactions
contemplated by the Other Contribution Agreements shall have been consummated at
or about the same time as the Closing hereunder.
(d) Additional Instruments. CUI shall have received the
Closing Documents listed on Exhibit D hereto and such other instruments and
documents as CUI or its counsel reasonably deems to be necessary.
5.3 ADDITIONAL CONDITIONS TO OBLIGATIONS OF BUSSINEAU. The
obligation of Bussineau to consummate his obligations under this Agreement is
also subject to the following conditions:
(a) Accuracy of Representations and Warranties. The
representations and warranties of CUI contained in this Agreement shall be true
and correct in all material respects on and as of the Closing Date, with the
same force and effect as if made on and as of the Closing Date, except for (i)
changes contemplated by this Agreement or in the CUI Disclosure Schedules, and
(ii) those representations and warranties which address matters only as of a
particular date (which shall have been true and correct as of such date, and
Bussineau shall have received a certificate to such effect signed by the
President of CUI.
(b) Agreements and Covenants. CUI shall have performed or
complied in all material respects with all agreements and covenants required by
this Agreement to be performed or complied with by it on or prior to the Closing
Date, and Bussineau shall have received a certificate to such effect signed by
the President of CUI.
(c) Additional Instruments. Bussineau shall have received
the additional Closing Documents listed on Exhibit D hereto and such other
instruments and documents as Bussineau or his counsel reasonably deems to be
necessary.
6. TERMINATION
6.1 Termination. This Agreement may be terminated and the
transactions herein contemplated may be abandoned at any time prior to the
Closing:
(a) By mutual written consent of CUI and Bussineau; or
(b) By CUI, if any of the conditions to its obligations
set forth in Section 5 of this Agreement shall not have been satisfied, or
waived by CUI in writing, prior to March 12, 1999;
(c) By Bussineau if any of the conditions set forth in
Section 5, if this Agreement to his obligations shall not have been satisfied,
or waived in writing by Bussineau, prior to March 12, 1999;
Provided, that in each of the foregoing cases the party so terminating
is not in breach of any of its material obligations or representations or
warranties under this Agreement.
Notwithstanding anything to the contrary contained elsewhere in this Agreement,
if a party hereto has breached this Agreement (a "Breaching Party") and such
breach is of a nature that it is susceptible of cure, and the other party
determines to terminate this Agreement by reason thereof, such other party shall
give prompt written notice of such termination to the Breaching Party and such
intended termination shall not become effective provided that the Breaching
Party effectuates a cure of such breach by the earlier of (i) the 30th day
following such notice of termination or (ii) March 12, 1999.
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6.2 Procedure Upon Termination. Any termination and
abandonment by CUI or Bussineau, or both, pursuant to Section 6.1 hereof, shall
be effective on written notice thereof from the terminating party to the other
parties and upon any such termination:
(a) Each party will redeliver all documents, workpapers
and other material of any other party relating to the transactions contemplated
hereby, whether so obtained before or after the execution hereof, to the party
furnishing the same;
(b) The obligations of confidentiality set forth in
Section 4.6 hereof shall continue despite such termination; and
(c) The parties shall be relieved of any obligation to
consummate the transactions contemplated hereby, but none of the parties shall
be relieved of any liability for its breach or default under this Agreement.
7. SURVIVAL OF REPRESENTATIONS AND WARRANTIES
Regardless of any due diligence or other investigation, either prior to
or after the Closing, or any verification or approval by any party hereto or by
anyone or on behalf of any party hereto, all of the representations and
warranties set forth in this Agreement or in any certificates delivered pursuant
hereto shall remain in full force and effect and shall survive the Closing until
the expiration of three (3) years from the Closing Date, except that (i)
Bussineau's representations and warranties contained in Sections 2.1 and 2.3,
and the representations and warranties of CUI contained in Sections 3.1,3.5 and
3.7, shall survive for a period of seven (7) years following the Closing. All
covenants which by their terms require performance or compliance following the
Closing shall remain in full force and effect and shall survive the Closing
until they have been fully performed and discharged.
8. MISCELLANEOUS.
8.1 ASSIGNMENT. No party may assign this Agreement, or assign
its rights or delegate its duties hereunder, without the prior written consent
of the other party.
8.2 SEVERABILITY. Any provision of this Agreement which is
illegal, invalid or unenforceable shall be ineffective to the extent of such
illegality, invalidity or unenforceability, without affecting in any way the
remaining provisions hereof.
8.3 GOVERNING LAW. This Agreement is deemed to have been made
in the State of Delaware, and its interpretation, its construction and the
remedies for its enforcement or breach are to be applied pursuant to, and in
accordance with, the laws of the State of Delaware for contracts made and to be
performed in that state. In the event any party hereto is required to initiate
any legal action or proceeding to enforce its rights hereunder, such action or
proceeding shall be brought and maintained exclusively in the Superior Court for
the County of Orange, in California and each party agrees to accept, and not to
challenge, the jurisdiction of such court over the parties and the subject
matter of such action or proceeding or the convenience of the forum and to
accept and not to challenge the adequacy of service by certified or registered
mail. The prevailing party in any such action or proceeding shall be entitled to
recover its reasonable attorneys fees and disbursements, expert witness fees and
disbursements and other costs of suit from the non-prevailing party. TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY HEREBY EXPRESSLY WAIVES
ITS RIGHT TO A JURY TRIAL IN ANY SUCH ACTION OR PROCEEDING, IRRESPECTIVE OF
WHICHEVER PARTY MAY BRING ANY SUCH ACTION OR PROCEEDING.
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8.4 ENTIRE AGREEMENT; AMENDMENT. This Agreement, and the
Exhibits and Schedules hereto, constitute all of the agreements of the parties
with respect to, and supersede all prior agreements and understandings relating
to, the subject matter of and the transactions contemplated by this Agreement.
This Agreement may not be modified or amended except by a written instrument
specifically referring to this Agreement signed by the parties hereto.
8.5 WAIVER. No waiver by one party of the other party's
obligations or of any breach or default hereunder by the other party, shall be
valid or effective unless such waiver is set forth in writing and is signed by
the party giving such waiver; and no such waiver shall be deemed a waiver of any
subsequent breach or default of the same or similar nature or any breach or
default by such other party of any of the other provisions of this Agreement.
8.6 INTERPRETATION AND CERTAIN DEFINITIONS. This Agreement is
the result of arms'-length negotiations between the parties hereto and no
provision hereof, because of any ambiguity found to be contained therein or
otherwise, shall be construed against a party by reason of the fact that such
party or its legal counsel was the draftsman of that provision. The section,
subsection and any paragraph headings contained herein are for the purpose of
convenience only and are not intended to define, limit or affect, and shall not
be considered in connection with, the interpretation of any of the terms or
provisions of this Agreement. Unless otherwise indicated elsewhere in this
Agreement, (a) the term "or" shall not be exclusive, (b) the term "including"
shall mean "including, but not limited to," and (c) the terms "herein,"
"hereof," "hereto," "hereunder" and other terms similar to such terms shall
refer to this Agreement as a whole and not merely to the specific section,
subsection, paragraph or clause where such terms may appear. In addition, for
purposes of this Agreement, the term "Sports Collectibles" means any products or
items, including but not limited to, (i) new or game-used baseballs, footballs,
basketballs, hockey pucks, sports gear and player uniforms, and (ii)
photographs, illustrations, trading cards or paintings or etchings, and (iii)
other items, that have a value in excess of the customary retail prices of
similar types of unused or new items, because of their prior use in sports
events or games or because they have been autographed by or are associated with
well-known athletes or other sports celebrities or are associated with well
known sports events.
8.7 NOTICES. All notices and other communications given or
made pursuant hereto shall be in writing and shall be deemed to have been duly
given or made if and when delivered personally or by overnight courier to the
parties at the addresses set forth on Exhibit E hereto or sent by electronic
transmission, with confirmation received, to the telecopy numbers specified on
that Exhibit (or at such other address or telecopy number for a party as shall
be specified by like notice).
8.8 COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the undersigned have executed this Agreement on the
date first above stated.
BUSSINEAU: CUI:
COLLECTORS UNIVERSE, INC.
/s/ Xxxx Xxxxxxxxx By: /s/ Xxxxx Xxxx
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Xxxx Xxxxxxxxx Xxxxx Xxxx, Chairman
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