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Exhibit 2.4
PURCHASE AND SALE AGREEMENT
Between
XXXXXXX XXXXXX ELECTRONICS CORPORATION, as Seller
and
XXXXXXX XXXXXX ELECTRONICS CO., as Purchaser
Dated as of July 28, 1995
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TABLE OF CONTENTS
ARTICLE I - DEFINITIONS
1.1 Assets ........................................................... 1
1.2 Business Day ..................................................... 2
1.3 Closing .......................................................... 2
1.4 Closing Date ..................................................... 2
1.5 Code ............................................................. 2
1.6 Contracts ........................................................ 2
1.7 ERISA ............................................................ 2
1.8 Environmental Laws ............................................... 2
1.9 Excluded Assets .................................................. 3
1.10 Intellectual Property Rights ..................................... 3
ARTICLE II - PURCHASE AND SALE OF ASSETS
2.1 Transfer of Assets ............................................... 3
2.2 Purchase Price ................................................... 4
2.3 Purchase Price Adjustment ........................................ 4
2.4 Assumption of Liabilities ........................................ 4
2.5 Taxes ............................................................ 6
ARTICLE III - CLOSING; TERMINATION
3.1 Closing .......................................................... 6
3.2 Termination ...................................................... 6
3.3 Deliveries of Seller ............................................. 7
3.4 Deliveries of Purchaser .......................................... 8
3.5 Further Assurances ............................................... 8
ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF SELLER
4.1 Status Authority ................................................. 9
4.2 Execution; Valid and Binding Agreements .......................... 9
4.3 Absence of Conflicts ............................................. 9
4.4 Title to Properties .............................................. 10
4.5 Litigation ....................................................... 10
4.6 Brokerage Commissions ............................................ 10
4.7 Patents and Trademarks ........................................... 10
4.8 Compliance with Laws ............................................. 10
4.9 Employee Benefit Plans ........................................... 10
4.10 Conflict of Interest ............................................. 11
4.11 Compliance with Law .............................................. 11
4.12 Disclaimers ...................................................... 11
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4.13 Environmental Matters ............................................ 11
4.14 Accounts Receivable .............................................. 12
4.15 No Undisclosed Liabilities ....................................... 12
4.16 Government Contracts ............................................. 12
4.17 Labor Matters .................................................... 12
ARTICLE V - REPRESENTATIONS AND WARRANTIES OF PURCHASER
5.1 Status; Authority ................................................ 12
5.2 Execution; Valid and Binding Agreements .......................... 12
5.3 Brokerage ........................................................ 13
5.4 Consents; Approval ............................................... 13
5.5 Litigation ....................................................... 13
5.6 Absence of Conflicts ............................................. 13
ARTICLE VI - INDEMNIFICATION
6.1 Indemnification by Seller ........................................ 14
6.2 Indemnification by Purchaser ..................................... 15
6.3 Notice and Payment of Claims ..................................... 15
6.4 Defense of Third-Party Claims .................................... 16
6.5 Survival of Representations and Warranties ....................... 16
6.6 Limitations on Indemnification ................................... 16
ARTICLE VII - EMPLOYEES
7.1 Purchaser's Obligations .......................................... 17
7.2 Employee Benefit Plans ........................................... 17
7.3 Severance ........................................................ 17
ARTICLE VIII - CONDITIONS PRECEDENT TO OBLIGATIONS OF PURCHASER
8.1 Accuracy of Representations and Warranties and
Performance of Obligations ....................................... 17
8.2 Consents ......................................................... 17
8.3 No Litigation or Contrary Judgment ............................... 17
8.4 Deliveries ....................................................... 18
ARTICLE IX - CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER
9.1 Accuracy of Representations and Warranties and
Performance of Obligations ....................................... 18
9.2 Consents ......................................................... 18
9.3 No Litigation or Contrary Judgment ............................... 18
9.4 Deliveries ....................................................... 18
9.5 Letters of Credit, etc. .......................................... 18
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ARTICLE X - ADDITIONAL COVENANTS
10.1 Intercompany Accounts ............................................ 18
10.2 Access Pending Closing ........................................... 19
10.3 Books and Records ................................................ 19
10.4 Confidentiality .................................................. 19
10.5 Filings; Cooperation ............................................. 21
10.6 Risk of Loss ..................................................... 21
10.7 Conflicting Proprietary Right; Assignment; License ............... 21
10.8 Transitional Use of Trademarks ................................... 21
10.9 Contracts ........................................................ 22
10.10 Xxxxxxx Xxxxxx South Wind Contract ............................... 22
10.11 Letters of Credit ................................................ 23
ARTICLE XI - MISCELLANEOUS
11.1 Expenses ......................................................... 23
11.2 Notices .......................................................... 23
11.3 Entire Agreement ................................................. 24
11.4 Severability ..................................................... 24
11.5 Assignability .................................................... 24
11.6 Captions ......................................................... 24
11.7 Governing Law .................................................... 24
11.8 Counterparts ..................................................... 24
11.9 Remedies Cumulative .............................................. 24
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PURCHASE AND SALE AGREEMENT
This Purchase and Sale Agreement (together with all Schedules and Exhibits
referred to herein, the "Agreement") made and entered into as of July 28, 1995,
among Xxxxxxx Xxxxxx Electronics Corporation, a Delaware corporation,
(hereinafter referred to as "Seller"), and Xxxxxxx Xxxxxx Electronics Co., a
Pennsylvania corporation, (hereinafter referred to as "Purchaser"),
WITNESSETH:
WHEREAS, Seller is engaged in the business of manufacturing and selling
electronic equipment for military applications (the "Business"); and
WHEREAS, Seller desires to sell to Purchaser, and Purchaser desires to
purchase from Seller, certain of the assets of Seller related to the Business,
all on the terms and conditions hereinafter set forth;
NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements hereinafter set forth, and intending to be legally bound hereby,
Seller and Purchaser hereby agree as follows:
ARTICLE I - DEFINITIONS
1.1 "Assets" shall mean all of the assets, properties and rights (other
than the Excluded Assets) that are used in or arise out of the Business as of
the Closing Date, whether owned, leased or licensed by Seller, including, but
not limited to, the following:
(a) all accounts, notes and other receivables;
(b) all inventories of supplies, merchandise, packaging, advertising
and promotional materials, and other materials and products, including raw
materials, work in process and finished goods;
(c) all tangible personal property, including but not limited to,
all fixtures, furnishings, furniture, office supplies, computers and
computer software, vehicles, rolling stock, machinery, equipment, tools,
leasehold improvements, goods, spare parts and other similar personal
property;
(d) all right, title and interest to and under the Contracts;
(e) all research and development and commercially practiced
processes, and manufacturing, engineering, computer software (including
source codes) and other technical information, and all notebooks, records,
reports and data relating thereto, subject to existing licenses;
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(f) all Intellectual Property Rights (as hereinafter defined);
(g) all of the books, records and data including, but not limited
to, all books, records and data relating to the purchase of materials,
supplies and services, sale of products, customers, invoices, records of
employees, commercial data, research done by or for Seller, credit
information, catalogues, brochures, training and other manuals, sales
literature, advertising and other sales and promotional materials,
maintenance records and drawings except for the 1995 general ledger and
related journals and records necessary to prepare Seller's tax returns or
filings, which may be copied by Purchaser upon request; and
(h) all rights or choses in action arising out of occurrences before
of after the Closing, including, without limitation, all rights under
express or implied warranties relating to the Assets.
1.2 "Business Day" shall mean any day other than a Saturday or Sunday on
which commercial banks in the Chicago, Illinois are open for business.
1.3 "Closing" shall mean the act of completing the transactions
contemplated by this Agreement.
1.4 "Closing Date" shall mean July 28, 1995, or such other date as shall
be agreed upon by the parties.
1.5 "Code" shall mean the Internal Revenue Code of 1986, as amended, and
all regulations promulgated thereunder.
1.6 "Contracts" shall mean all contracts, subcontracts, leases, options,
purchase orders, sales orders, guarantees, arrangements, undertakings,
agreements, understandings, obligations and other commitments of any kind,
written or oral, relating to the Business other than the Agreement dated
December 2, 1993 between Seller and the United Electrical, Radio and Machine
Workers of America and the United Workers Association - UE Local 1154 (the
"Union Contract").
1.7 "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended, and all regulations promulgated thereunder.
1.8 "Environmental Laws" shall mean all U.S., federal, state, and local
laws, ordinances, regulations, orders, judgments, and injunctions relating to
pollution or protection of the environment, including, but not limited to, laws
relating to emissions, discharges, releases of pollutants, contaminates,
chemicals, toxic or hazardous substances, wastes or other substances or
materials into the environment (land, water or air) or otherwise relating to the
manufacturing, processing, distribution, use, treatment, burial, storage,
disposal, transport or handling of
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pollutants, contaminants, chemicals, or toxic or hazardous substances or wastes
and all permits, approvals, consents or other authorizations by or pursuant to
any of the foregoing laws.
1.9 "Excluded Assets" shall mean;
(a) all trademarks and trade names now or previously used in
connection with the Business other than those expressly included in
Schedule 4.7;
(b) all cash, bank balances, moneys in possession of banks and other
depositories and similar cash property of, owned or held by or for the
account of Seller as at the Closing;
(c) non-trade balances with affiliates of Seller (set forth on
Schedule 1.9(c) hereto);
(d) the Seller's leased vehicles;
(e) proprietary financial management software of BTR, Inc. or its
affiliates;
(f) assets specifically related to the commercial line tracing and
cutting systems business of Seller (the "Line Tracing Business");
(g) the corporate records of Seller;
(h) any tax refunds due to Seller; and
(i) all real property of Seller including, without limitation, the
real property located at 0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx (the
"Facility").
1.10 "Intellectual Property Rights" shall mean the patents, trademarks and
other intellectual property specifically listed on Schedule 4.7 and all other
inventions, know how, trade secrets, trade names, package designs, trade dress,
service marks, copyrights, business names, advertisements, promotional
materials, designs, models, registrations and applications and rights to apply
for any of the foregoing, and all similar proprietary rights which may subsist
in any part of the world, to the extent that all of the above exclusively belong
to Seller and are used in the Business, along with the good will associated
therewith.
ARTICLE II - PURCHASE AND SALE OF ASSETS
2.1 Transfer of Assets. Subject to the terms and conditions of this
Agreement and in reliance on the representations, warranties, and covenants
herein, at the Closing, Seller shall sell, assign, transfer, convey and deliver
the Assets to Purchaser, and Purchaser shall purchase,
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acquire and accept the Assets from Seller, free and clear of all mortgages,
liens, pledges, security interests, charges, claims, restrictions and
encumbrances of any nature whatsoever.
2.2 Purchase Price. On the terms and subject to the conditions set forth
in this Agreement, on the Closing Date Seller agrees to sell, and Purchaser
agrees to purchase, all of the Assets for a total cash purchase price in the
amount of $250,000 (the "Purchase Price").
2.3 Purchase Price Adjustment. On the Closing Date, Seller shall deliver a
preliminary statement to Purchaser showing the Seller's good faith estimate of
the aggregate amount of (i) trade payables (other than intercompany payments to
affiliates of Seller), (ii) payroll costs less payments related to accruals for
periods prior to July 1, 1995 and (iii) other cash disbursements (other than
intercompany payments to affiliates of Seller) made in the normal course of
business paid by Seller less the accounts receivable and customer deposits
received by Seller from and after July 1, 1995 (the "Effective Time") through
the Closing Date (such statement not to include amounts incurred or received in
connection with the Line Tracing Business). On the Closing Date the Purchase
Price shall be adjusted dollar for dollar for such net amount, it being intended
that Seller and Purchaser be placed in the same position on a cash basis as if
the Closing Date had occurred on June 30, 1995. Promptly after the Closing Date
(but no later than 10 business days after such date) Seller and Purchaser shall
make a final adjustment to reflect any variation between Seller's good faith
estimate and the actual cash adjustment required to effect the intent of this
Section 2.3.
2.4 Assumption of Liabilities. Notwithstanding anything to the contrary
set forth herein, in no event shall Purchaser assume or incur any liability or
obligation under this Agreement or otherwise become responsible in respect of
the following (hereinafter collectively referred to as the "Excluded
Liabilities"):
(a) Any liability or obligation of any nature whatsoever which
arises out of or is related to any action, suit, claim or legal,
administrative, arbitration, governmental or other proceeding or
investigation now pending or hereafter instituted relating to the Business
or Assets to the extent the principal event giving rise thereto occurred
prior to the Closing Date or which results from or arises out of any
action or inaction prior to the Closing Date of Seller or any affiliate,
officer, director, employee, agent, representative or subcontractor of
Seller;
(b) Any federal, state or local income, sales, use, excise, ad
valorem, intangibles or other tax and any and all penalties and interest
relating thereto (i) payable with respect to the business, assets,
properties or operations (including, but not limited to, the Business or
Assets) of Seller, any member of any affiliated group of which Seller is a
member or any other person for whose taxes Seller may be liable for any
period prior to the Closing, or (ii) incident to or arising as a
consequence of the negotiations or consummation by Seller or any member of
any affiliated group of which Seller is a member of this Agreement and the
transactions contemplated hereby;
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(c) Any liability or obligation arising under or relating to any of
the Excluded Assets;
(d) Any liability or obligation of any nature whatsoever arising
prior to or as a result of the Closing to any employee, agent or
independent contractor of the Seller, whether or not employed by Purchaser
after the Closing, or under any benefit plan or arrangement with respect
thereto, including, but not limited to, severance obligations and accruals
for vacation pay, sick pay and similar accruals other than liabilities
expressly assumed by Purchaser pursuant to Section 2.4(e);
(e) Any liability or obligation of Seller arising or incurred in
connection with the negotiation, preparation and execution of this
Agreement and the transactions contemplated hereby and any fees and
expenses of counsel, accountants or other experts of Seller or any of its
affiliates;
(f) Any liabilities or obligations of either Seller or any
subsidiary under any debts, notes, negotiable instruments and written or
oral commitments to repay indebtedness, including, without limitation, any
intercompany debt; or
(g) Any mortgage, security interest, lien or encumbrance of Seller
or any subsidiary of any kind.
In addition to hiring those persons set forth on Schedule 7.1, Purchaser
shall assume on the Closing Date, subject to the terms and conditions of this
Agreement:
(a) all duties and obligations required to be performed after the
Closing Date pursuant to the Contracts (including, without limitation, all
warranty liabilities);
(b) all trade payables (which, for the purposes of identification
only, were [$77,997] on June 30, 1995 minus any amount representing legal
fees incurred by Seller in connection with the DOD subpoena referenced in
Schedule 4.5 ($30,136 as of June 30, 1995));
(c) except as otherwise set forth in this Agreement, all liabilities
of whatsoever type or nature arising out of or associated with the
ownership of the Assets or the operation of the Business after the
Closing. Without limiting the foregoing, Purchaser shall be liable for all
product liability claims for products shipped after the Closing by
Purchaser and workers' compensation claims relating to the Business for
occurrences taking place after the Closing Date;
(d) any liability associated with customer deposits to the extent
accrued on Seller's books (which, for the purposes of identification
only, were $360,000 on June 30, 1995); and
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(e) any liability relating to accruals for vacation pay, sick pay
and similar accruals for those employees listed in Schedule 7.1 arising
from and after July 1, 1995 and, for all employees accepting employment
with Purchaser, all liability for severance payments for such employees.
2.5 Taxes.
(a) All sales, use, value-added, stamp duty, transfer or other
similar taxes incurred in connection with the transfer and sale of the
Assets to Purchaser shall be borne by Seller. All property ad valorem
taxes which have accrued or have been assessed or liened against the
Assets shall be paid by Seller. Any taxes on net income resulting from the
sale of the Assets to Purchaser or with respect to the operation of the
Business prior to Closing shall be borne by Seller. All taxes collected by
Seller from third parties prior to Closing including, but not limited to,
sales and use taxes and all payroll withholding taxes, including both
employee and employer portions of F.I.C.A., shall be paid by Seller to the
appropriate governmental authority and Purchaser shall bear no
responsibility for any portion thereof.
(b) Purchaser and Seller agree to furnish or cause to be furnished
to each other, upon request, as promptly as practical, such information
(including access to books and records) and assistance as is reasonably
necessary for the filing of any tax return, the preparation for any tax
audit, and for the prosecution or defense of any claim, suit or proceeding
relating to any tax matter. Seller and Purchaser shall cooperate with each
other in the conduct of any tax audit or other tax proceedings and each
shall execute and deliver such powers of attorney and other documents as
are necessary to carry out the intent of this Agreement.
(c) Seller and Purchaser will mutually agree to the allocation of
the Purchase Price among the Assets in accordance with Section 1060 of the
Code. Seller and Purchaser will each be bound by such allocation in
preparing their respective tax returns.
ARTICLE III - CLOSING; TERMINATION
3.1 Closing. The Closing shall take place at 12:00 noon local time on the
Closing Date, at the offices of Seller, or at such other place, time and date as
Seller and Purchaser may mutually agree. Such Closing shall be deemed effective
at 11:59 p.m. local time on the Closing Date.
3.2 Termination. This Agreement may be terminated on written notice at any
time prior to Closing:
(a) by mutual consent of Seller and Purchaser;
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(b) by either Purchaser or Seller if there has been a material
misrepresentation or breach of warranty on the part of any party in the
representations and warranties set forth in this Agreement, or if there
has been a material breach of any of the covenants on the part of any
party as set forth in this Agreement, which breach has not been cured
within a reasonable time after notice thereof;
(c) by either Purchaser or Seller if on the Closing Date any of the
conditions to their respective obligations to perform has not been met or
waived;
(d) by either Purchaser or Seller if the Closing has not occurred on
or prior to August 15, 1995.
Upon any such termination, the parties shall be released from all
obligations or liabilities arising hereunder except for liabilities arising out
of pre-termination breaches hereof, and liabilities arising out of the failure
or refusal of either party to consummate the Closing if all conditions precedent
set forth in either Article VIII or Article IX, as appropriate, have been met or
waived.
3.3 Deliveries of Seller. Seller shall deliver to Purchaser at or prior to
the Closing the following documents:
(a) certified copies of resolutions adopted by the Board of
Directors and sole shareholder of Seller authorizing this Agreement and
the transactions contemplated hereby;
(b) an opinion of the Assistant General Counsel of Seller, addressed
to Purchaser, and dated as of the Closing Date, substantially in the form
of Exhibit A attached hereto;
(c) such bills of sale, endorsements, assignments, deeds and other
good and sufficient instruments of conveyance and transfer, in form and
substance reasonably satisfactory to the Purchaser, and its counsel, as
shall be necessary and effective to vest in Purchaser good and marketable
title to the Assets, including, without limitation, (i) good and valid
title in and to all of the Assets owned by Seller, (ii) good and valid
leasehold interest in and to all of the Assets leased by Seller as lessee,
and (iii) all of Seller's rights under all agreements, contracts,
commitments, leases, plans, bids, quotations, proposals, instruments and
other documents included in the Assets to which Seller is a party or by
which it has rights on the Closing Date;
(d) a lease agreement covering the Facility between Seller and
Purchaser in the form of Exhibit 3.3(d) (the "Lease");
(e) such other documents, instruments or certificates as shall be
reasonably requested by Purchaser;
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(f) all of the agreements, contracts, commitments, leases, plans,
bids, quotations, proposals, instruments, computer programs and software,
data bases whether in the form of computer tapes or otherwise, related
objects and sources codes, manuals and guidebooks, price books and price
lists, customer and subscriber lists, supplier lists, sales records,
files, correspondence, legal opinions, rulings issued by governmental
entities, and other documents, books, records, papers, files, office
supplies and data belonging to Seller which are part of the Assets; and
(g) Guaranties of BTR Dunlop, Inc. and Xxxxxxx Xxxxxx Corporation in
the form of Exhibit 3.3(f).
3.4 Deliveries of Purchaser. Purchaser shall deliver to Seller at the
Closing the following:
(a) $250,000 plus or minus Seller's initial estimate of the cash
adjustment contemplated by Section 2.3, by wire transfer in immediately
available funds;
(b) an opinion of counsel to the Purchaser, addressed to Seller and
dated as of the Closing Date, substantially in the form of Exhibit B
attached hereto;
(c) certified copies of resolutions adopted by the Board of
Directors and shareholder of Purchaser authorizing this Agreement and the
transactions contemplated hereby;
(d) the Lease;
(e) a Guaranty of Xxxxxx Industries, Inc. in the form of Exhibit
3.4(f); and
(f) such other documents, instruments or certificates as shall be
reasonably requested by Seller.
3.5 Further Assurances. Seller from time to time after the Closing, at
Purchaser's request, will execute, acknowledge and deliver to Purchaser such
other instruments of conveyance and transfer and will take such other actions
and execute and deliver such other documents, certifications and further
assurances as Purchaser may reasonably request in order to vest more effectively
in Purchaser, or to put Purchaser more fully in possession of, any of the
Assets, or to better enable Purchaser to complete, perform or discharge any of
the Assumed Obligations. Each of the parties hereto will cooperate with the
other and execute and deliver to the other such other instruments and documents
and take such other actions as may be reasonably requested from time to time by
any party hereto as necessary to carry out, evidence and confirm the intended
purposes of this Agreement.
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ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF SELLER
Seller hereby represents and warrants to Purchaser the following:
4.1 Status Authority. Seller is duly incorporated, validly existing and in
good standing under the laws of the State of Delaware and has all requisite
corporate power and authority to own, lease and operate its properties and to
carry on its business as is now being conducted. Seller is duly qualified to
transact business, and is in good standing, as a foreign corporation in each
jurisdiction where the character of its activities requires such qualification,
except where the failure to so qualify would not have a material adverse effect
on the assets, liabilities, results of operations, financial condition, business
or prospects of the Business. Seller has all requisite corporate power and
authority to execute and deliver this Agreement and each of the instruments and
other documents to be executed and delivered hereunder, and to perform its
respective obligations hereunder and thereunder. Seller has or will have by
Closing taken all action required by law, its articles of incorporation, bylaws
or otherwise to authorize the execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby.
4.2 Execution; Valid and Binding Agreements. The execution, delivery and
performance by Seller of this Agreement and the consummation by it of the
transactions contemplated hereby have been duly authorized by all required
corporate and shareholder action. This Agreement has been duly executed and
delivered by Seller and, assuming that this Agreement is the valid and binding
agreement of Purchaser, constitutes the valid and binding agreement of Seller,
enforceable against Seller in accordance with its terms, except to the extend
that:
(a) such enforcement may be limited by bankruptcy, insolvency,
reorganizations, moratorium or other similar laws affecting the
enforcement of creditors' rights generally; and
(b) certain of the covenants contained herein may not be
specifically enforceable and, in such event, courts may award money
damages rather than specific performance of contractual provisions
involving matters other than the payment of money.
4.3 Absence of Conflicts. The execution, delivery and performance of this
Agreement, and any instrument or other document to be executed and delivered by
Seller hereunder, does not and will not violate or conflict with, result in a
breach of, constitute a default under or give rise to a right of acceleration or
termination under (with or without notice, lapse of time, or both) (i) the
certificate of incorporation or by-laws of Seller, (ii) any law, regulation,
rule, order, arbitration award, judgement, decree or other similar restriction
to which Seller is subject or by which it is bound, or (iii) any note, mortgage,
indenture, bond or contract, agreement, plan, instrument, lease, waiver, license
or permit to which Seller is a party or by
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which it is bound, provided, however, that Seller makes no representation or
warranty as to the assignability of any Contract or the need to obtain any
consents to effect such assignments.
4.4 Title to Properties.
(a) Seller has good and marketable title to the Facility.
(b) Seller has good and marketable title to all the Assets, free and
clear of all claims, security interests, liens, pledges, charges,
encumbrances and restrictions of any nature whatsoever.
(c) the fixed assets to be transferred to Purchaser pursuant to this
Agreement constitute all the fixed assets currently used in the Business.
4.5 Litigation. Except as set forth in Schedule 4.5, there are no actions,
suits, claims, proceedings or investigations pending or, to Seller's knowledge,
threatened against, relating to or involving the Business or Assets before any
court, arbitration or administrative or governmental body, which may have a
material adverse effect on the Business or upon Seller's ability to perform this
Agreement or consummate the transactions contemplated hereby, and no order,
injunction, decree or unsatisfied judgment which is outstanding against or
relating to the Business or which could reasonably be expected to interfere with
Seller's ability to consummate the transactions contemplated by this Agreement.
4.6 Brokerage Commissions. There are no claims for brokerage commissions,
finders' fees or similar compensation in connection with the transactions
contemplated by this Agreement based on any arrangement or agreement made by or
on behalf of Seller.
4.7 Patents and Trademarks. Schedule 4.7 attached hereto sets forth a list
of patents, patent applications and trademarks (whether registered or applied
for) owned by Seller. Immediately following the Closing, Purchaser will own all
right, title and interest in and to, and will enjoy the unencumbered exclusive
right to use, the Intellectual Property Rights, including all goodwill
associated therewith, except for licenses retained by Seller or Seller's
affiliates.
4.8 Compliance with Laws. Except as disclosed on Schedule 4.5, Seller has
not received notice of any violation of any federal, state, local or foreign
law, ordinance or regulation relating to the Business and, to the best of
Seller's knowledge, Seller is not in violation of any such law, ordinance or
regulation, the violation of which has had or could reasonably be expected to
have a material adverse effect on the Business.
4.9 Employee Benefit Plans. Schedule 4.9 attached hereto sets forth all of
the employee benefit plans and programs of Seller applicable to employees of the
Business under which Seller is or may become obligated to provide benefits to
such employees including, without limitation, pension, retirement,
profit-sharing, savings, bonus, deferred or incentive compensation,
hospitalization, medical, life or disability insurance plans, vacation and paid
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holiday benefits, termination or severance pay benefits, and restricted stock,
stock option, stock appreciation rights or similar plan (the "Plans"). Seller
has not made any written or oral statements or representations that would give
rise to an obligation on the part of Purchaser to offer the employees any
benefits other than those listed in Schedule 4.9. The Plans have been maintained
and administered in compliance with applicable federal and state laws,
regulations and rules, including, but not limited to, ERISA and the Code and all
applicable laws and regulations. All contributions required by law or contract
to be made to each Plan have been timely made. Neither Seller nor any of its
directors, officers, or agents have been involved in any prohibited transactions
with respect to such Plans.
4.10 Conflict of Interest. No officer, director or employee of Seller:
(a) has any interest in any property, asset or right which is used
by Seller in the conduct of the Business or in any entity which does any
business with Seller, or
(b) has any contractual relationship with Seller other than as an
officer, director or employee.
4.11 Compliance with Law. Seller has all material authorizations,
approvals, licenses and orders of and from all governmental and regulatory
officers and bodies necessary to carry on the Business as it is currently being
conducted, to own or hold under lease the properties and assets it owns or holds
under lease and to perform all of its obligations under all agreements to which
it is a party, and Seller has been and is in compliance with all applicable
laws, regulations and administrative orders of any country, state or
municipality or of any subdivision thereof to which its business and its
employment of labor or its use or occupancy of properties or the violation of
which would have a material adverse effect upon the Assets, liabilities, results
of operations, financial condition, business or prospects of the Business.
4.12 DISCLAIMERS. EXCEPT AS EXPRESSLY PROVIDED HEREIN, SELLER MAKES NO
REPRESENTATIONS OF ANY KIND OR NATURE, EXPRESS OR IMPLIED, REGARDING THE
BUSINESS OR THE ASSETS INCLUDING, WITHOUT LIMITATION, AS TO THE PHYSICAL
CONDITION, VALUE, QUANTITY OR QUALITY OF THE INVENTORY, MACHINERY AND EQUIPMENT
AND RECEIVABLES, AND SELLER SPECIFICALLY DISCLAIMS ANY WARRANTY OF
MERCHANTABILITY, USAGE OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY OF THE
ASSETS.
4.13 Environmental Matters. The operations of the Business are in
compliance in all material respects with all statutes, regulations and
ordinances relating to the protection of human health and the environment. There
has been no release of a hazardous substance into the environment at any
property owned, leased or used by the Seller (the "Premises") including, without
limitation, any such release in the soil or groundwater underlying the Premises.
The Seller has not received notice of any violation of any environmental statute
or regulation nor has it been advised of any claim or liability pursuant to any
environmental statute or regulation
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brought by any governmental agency or private party with respect to the Assets
or the operation of the Business.
4.14 Accounts Receivable. The accounts receivable as set forth on Schedule
4.14 are valid and genuine; have arisen solely out of bona fide sales and
performance of services and other business transactions in the ordinary course
of business consistent with past practices of the Business.
4.15 No Undisclosed Liabilities. The Seller does not have any liabilities
or obligations which are not adequately reflected or provided for in the
Agreement or the Exhibits hereto (including the balance sheet dated June 30,
1995 attached as Schedule 4.14 hereto) except liabilities and obligations
incurred since June 30, 1995 in the ordinary course of business and consistent
with past practices of the Business.
4.16 Government Contracts. With respect to government contracts or OEM
subcontracts included in the Contracts, there are not (i) any outstanding
written cure notices or show causes, (ii) any written notices of contract
termination or stop work orders, (iii) any written final decision assessing a
penalty or damages, (iv) any outstanding written assertion of a formal claim
based on violation of government cost accounting standards or government
pricing, (v) any outstanding formal notice of proposed disallowance of indirect
cost claims, or (vi) except as provided in this Agreement, any subpoena or
written notice signifying government investigation.
4.17 Labor Matters. There is no pending unlawful employment practice or
discrimination charge involving the Seller. There is no pending unfair labor
practice charge or complaint against Seller. There is no labor strike, dispute,
slowdown or stoppage actually pending or, to the best knowledge of the Seller
executives, threatened against or involving or affecting the Seller. No
grievance or arbitration proceeding relating to the employees of the Seller is
pending.
ARTICLE V - REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to Seller the following:
5.1 Status; Authority. Purchaser is duly incorporated, validly existing
and in good standing under the laws of the Commonwealth of Pennsylvania.
Purchaser has all requisite corporate power and authority to execute and deliver
this Agreement and each of the instruments and other documents to be executed
and delivered by it hereunder, and to perform its obligations hereunder and
thereunder. Purchaser has or will have by Closing taken all action required by
law, its articles of incorporation, bylaws or otherwise to authorize the
execution, delivery and performance of this Agreement and the consummation of
the transactions contemplated hereby.
5.2 Execution; Valid and Binding Agreements. The execution, delivery and
performance by Purchaser of this Agreement and the consummation by it of the
transactions
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contemplated hereby have been duly authorized by Purchaser's board of directors.
This Agreement has been duly executed and delivered by Purchaser and, assuming
that this Agreement is the valid and binding agreement of Seller, constitutes
the valid and binding agreement of Purchaser, enforceable against Purchaser in
accordance with its terms, except to the extent that:
(a) such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement
of creditors' rights generally; and
(b) certain of the covenants contained herein may not be
specifically enforceable and in such event, courts may award money damages
rather than specific performance of contractual provisions involving
matters other than the payment of money.
5.3 Brokerage. There are no claims for brokerage commissions, finders'
fees or similar compensation in connection with the transactions contemplated by
this Agreement based on any arrangement or agreement made by or on behalf of
Purchaser.
5.4 Consents; Approval. No permit, consent, approval or authorization of,
or declaration to or filing or registration with, any governmental or regulatory
authority (including, without limitation, U.S. or foreign government security
clearances) is required in connection with the execution, delivery or
performance of this Agreement by Purchaser or the consummation of any other
transaction contemplated hereby.
5.5 Litigation. Except as set forth in Schedule 5.5, there are no actions,
suits, claims, proceedings or investigations pending or, to Purchaser's
knowledge, threatened against Purchaser, before any court, arbitration or
administrative or governmental body, which may have a material adverse effect on
Purchaser's ability to perform this Agreement or consummate the transactions
contemplated hereby, and no order, injunction, decree or unsatisfied judgment
which is outstanding against Purchaser which could reasonably be expected to
interfere with Purchaser's ability to consummate the transactions contemplated
by this Agreement.
5.6 Absence of Conflicts. The execution, delivery and performance of this
Agreement, and any instrument or other document to be executed and delivered by
Purchaser hereunder, does not and will not violate or conflict with, result in a
breach of, constitute a default under or give rise to a right of acceleration or
termination under (with or without notice, lapse of time, or both) (i) the
articles of incorporation or by-laws of Purchaser, (ii) any law, regulation,
rule, order, arbitration award, judgment decree or other similar restriction to
which Purchaser is subject or by which it is bound, or (iii) any note, mortgage,
indenture, bond or contract, agreement, plan instrument lease, license or permit
to which Purchaser is a party or by which it is bound.
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ARTICLE VI- INDEMNIFICATION
6.1 Indemnification by Seller. Except as set forth elsewhere in this
Agreement, and except for the negligence of Purchaser, Seller agrees to
indemnify and hold harmless Purchaser against and in respect of any and all
claims, liabilities, obligations, losses, costs deficiencies, litigation, taxes,
assessments, demands, damages, or judgments of any kind or nature whatsoever
("Claims") related to, arising from, or associated with:
(a) any breach or violation of the covenants made in this Agreement
by Seller;
(b) any breach or violation of the unexpired representations and
warranties made in this Agreement by Seller;
(c) the liabilities and obligations not expressly assumed by
Purchaser pursuant to this Agreement;
(d) any investigation, cleanup, remedial or removal activity, damage
to natural resource, personal injury or property damage of any nature
whatsoever arising out of or relating to the use of any substance, waste,
airborne particles, contaminate, hazardous substance or pollutant
considered to be hazardous under any applicable federal, state or local
law, rule, regulation or ordinance in effect as of the Closing Date
(collectively, "Hazardous Materials") to the extent that such use occurred
on or prior to the Closing Date, and such activity took place on, or
Hazardous Materials were produced at, or originated from, property owned
or leased by Seller associated with the operation of the Business;
provided, however, that in the event of any environmental remediation
actions, Seller shall have the right to undertake and control, at its
expense, such remediation and to accomplish such remediation at the lowest
cost practicable so long as to grant Seller such rights is permitted by
applicable law and so long as Seller accomplished such remediation in
accordance with any applicable requirements imposed by any law regulation
or ordinance or by any court or governmental authority;
(e) any tax liability relating to periods prior to the Closing;
(f) any employment related liability or claim relating to any period
prior to the Closing, including, without limitation, claims for medical
payments, severance or other employee benefits, and claims arising out of
the Union Contract;
(g) any claims for workers' compensation based on occurrences prior
to the Closing;
(h) any product liability claims relating to occurrences prior to
the Closing;
(i) non-compliance by Seller with bulk sales laws or similar common
law in connection with this transfer; and
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(j) any and all direct liability including damages or losses under
the Contracts to Purchaser or its parents and affiliates (including costs,
disbursements and reasonable legal fees) associated with the Department of
Defense subpoena received by the Seller on March 29, 1995 and any ensuing
investigation and proceeding, but expressly excluding indirect or
consequential losses including, but not limited to, loss of business from
existing or future customers of Purchaser or its affiliates (other than
work under the Contracts).
6.2 Indemnification by Purchaser. Except as set forth elsewhere in this
Agreement or in any Schedule or Exhibit hereto, Purchaser shall indemnify and
hold harmless Seller against and in respect of all Claims related to, arising
from, or associated with:
(a) any breach or violation of the covenants made in this Agreement
by Purchaser;
(b) any breach or violation of the unexpired representations or
warranties made in this Agreement by Purchaser;
(c) all product liability claims relating to occurrences involving
products shipped by Purchaser after the Closing,
(d) any claims for workers' compensation based on occurrences after
the Closing,
(e) any acts, omissions, events, occurrences, circumstances or
transactions of whatsoever type or nature associated with, arising out of
or relating to the ownership, use or possession of the Assets by
Purchaser, or the conduct or operation of the Business by Purchaser, after
the Closing;
(f) the liabilities and obligations assumed by Purchaser pursuant to
Section 2.4 hereof; and
(g) the failure to obtain consents or approvals from parties to any
Contracts in connection with the transactions contemplated herein or the
termination, placing in default or any other action that might be taken by
any customer under the Contracts as a result of the transactions
contemplated by this Agreement.
6.3 Notice and Payment of Claims. Upon obtaining knowledge of any Claims,
the party entitled to indemnification (the "Indemnitee") shall promptly notify
the party liable for such indemnification (the "Indemnitor") in writing of such
Claims which the Indemnitee has determined has given or could give rise to a
Claim under Section 6.1 or Section 6.2 hereof (such written notice being
hereinafter referred to as a "Notice of Claim"); provided, however, that failure
of an Indemnity timely to give a Notice of Claim to the Indemnitor shall not
release the Indemnitor from its indemnity obligations set forth in this Article
VI except to the extent that
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such failure adversely affects the ability of the Indemnitor to defend such
Claims or materially increase the amount of indemnification which the Indemnitor
is obligated to pay hereunder, in which event the amount of indemnification
which the Indemnitee shall be entitled to receive shall be reduced to an amount
which the Indemnitee would have been entitled to receive had such Notice of
Claim been timely given. In addition, if the Indemnitee settles or compromises
any third party claims prior to giving a Notice of Claim to Indemnitor, the
Indemnitor shall be released from its indemnity obligations to the extent that
such settlements or compromises were not made in good faith and were not
commercially reasonable. A Notice of Claim shall specify in reasonable detail
the nature and estimated amount of any such Claim giving rise to a right of
indemnification. The Indemnitee shall satisfy its obligations under Section 6.1
or Section 6.2 as the case may be, within sixty days of its receipt of a Notice
of Claim; provided, however, that for so long as the Indemnitor is defending a
Claim in good faith pursuant to Section 6.4 below, its obligations to indemnify
the Indemnitee with respect thereto shall be suspended. The Indemnitor shall
have thirty days after receipt of a Notice of Claim to notify the Indemnitee
whether or not it disputes its liability to the Indemnitee with respect to such
Notice of Claim.
6.4 Defense of Third-Party Claims. With respect to any action or any claim
set forth in a Notice of Claim relating to a third-party claim, the Indemnitor
shall defend, in good faith and at its expense, any such claim or demand, and
the Indemnitee, at its expense, shall have the right, but not the obligation, to
participate in the defense of any such third-party claim, with counsel of its
own choosing. So long as the Indemnitor is defending in good faith any such
third-party claim, the Indemnitee shall not settle or compromise such
third-party claim. The Indemnitee shall make available to the Indemnitor or its
representatives all records and other materials reasonably required for use in
contesting any third-party claim and shall cooperate fully with the Indemnitor
in the defense of all such claims. In the event the Indemnitor shall fail timely
to defend, contest or otherwise protect against any such suit, action,
investigation, claim or proceeding, the Indemnitee shall have the right, but not
the obligation, to defend, contest or otherwise protect against the same, and
make any compromise or settlement thereof and recover the entire cost thereof
from the Indemnitor including reasonable attorneys' fees, disbursements, and all
amounts paid as a result of such suit, action, investigation, claim or
proceeding or the compromise or settlement thereof.
6.5 Survival of Representations and Warranties. All of the representations
and warranties made by any party in Article IV and Article V of this Agreement
shall survive for a period of one year from the Closing Date. No party shall be
entitled to indemnification for breach of any representation and warranty set
forth in Article IV or Article V of this Agreement unless a Notice of Claim of
such breach has been given to the breaching party within the period of survival
of such representation and warranty as set forth herein. Nothing contained
herein shall affect the obligations of the parties as set forth elsewhere in
this Article 6 and in this Agreement.
6.6 Limitations on Indemnification. Notwithstanding anything to the
contrary contained herein, no indemnification obligation shall arise hereunder
except to the extent that all Claims asserted by a party hereto exceeds $50,000
in the aggregate, it being understood that such
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$50,000 is a deductible and not a threshold, provided, however, that such
deductible shall not apply to Claims relating to taxes or to the indemnification
obligations of Seller in Sections 6.1(g) and 6.1(k) or of Purchaser in Sections
6.2(f).
ARTICLE VII - EMPLOYEES
7.1 Purchaser's Obligations. Effective as of 12:01 a.m. on the day after
Closing Date, Purchaser shall offer employment to all employees of Seller
identified in Schedule 7.1. Purchaser agrees that for purposes of eligibility
and vesting in those benefit plans of Purchaser in which he or she is otherwise
eligible to participate, each employee will be credited with the length of
service and/or seniority accumulated by such employee with Seller.
7.2 Employee Benefit Plans. Seller shall retain all liabilities for the
Plans and Purchaser shall have no responsibility therefor.
7.3 Severance. Any employees set forth on Schedule 7.1 terminated by
Purchaser after Closing shall be entitled only to such severance benefits as
Purchaser may provide under its plans, policies and practices and shall have no
claim on Seller.
ARTICLE VIII - CONDITIONS PRECEDENT TO OBLIGATIONS OF PURCHASER
The obligations of Purchaser to consummate the transactions contemplated
by this Agreement shall be subject to the satisfaction, on or prior to the
Closing Date, of each of the following conditions precedent, any of which may be
waived in writing by Purchaser:
8.1 Accuracy of Representations and Warranties and Performance of
Obligations. All representations and warranties made by Seller in this Agreement
shall be true and correct in all material respects on and as of the Closing Date
with the same effect as if such representations and warranties had been made on
and as of the Closing Date and Seller shall have performed or complied with all
covenants, agreements and conditions contained in this Agreement on its part
required to be performed or complied with at or prior to the Closing.
8.2 Consents. All authorizations, consents or approvals of any and all
governments, governmental authorities, and quasi-governmental authorities
necessary in connection with the consummation of the transactions contemplated
by this Agreement shall have been obtained and shall be in full force and
effect.
8.3 No Litigation or Contrary Judgment. On the Closing Date there shall
exist no lawsuit or other claim or action in regard to any foreign, federal,
state or local law or regulation (or administrative proceeding or investigation)
which could interfere with the consummation of the transactions contemplated by
this Agreement or which could materially adversely affect the Business or the
financial condition or results of operations of the Business, except as
previously
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disclosed in this Agreement or any of the Schedules hereto. The Closing shall
not violate any order, decree or judgment of any court or governmental body
having competent jurisdiction.
8.4 Deliveries. Seller shall have made or tendered, or caused to be made
or tendered, delivery to Purchaser of the documents set forth in Section 3.3.
ARTICLE IX - CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER
The obligations of Seller to consummate the transactions contemplated by
this Agreement shall be subject to the satisfaction, on or prior to the Closing
Date, of each of the following conditions precedent, any of which may be waived
in writing by Seller:
9.1 Accuracy of Representations and Warranties and Performance of
Obligations. All representations and warranties made by Purchaser in this
Agreement shall be true and correct on and as of the Closing Date with the same
effect as if such representations and warranties had been made on and as of the
Closing Date; and Purchaser shall have performed or complied with all covenants,
agreements and conditions contained in this Agreement on its part required to be
performed or complied with at or prior to the Closing.
9.2 Consents. All authorizations, consents or approvals of all
governments, governmental authorities and quasi-governmental authorities
necessary in connection with the consummation of the transactions contemplated
by this Agreement shall have been obtained on terms reasonably satisfactory to
Seller and shall be in full force and effect.
9.3 No Litigation or Contrary Judgment. On the Closing Date there shall
exist no lawsuit or other claim or action in regard to foreign or U.S. federal,
state, or local law or regulation (or any administrative proceeding or
investigation) which could adversely affect the transfer of the Assets to
Purchaser or interfere with the consummation of the transactions contemplated by
this Agreement except as previously disclosed in this Agreement or the Schedules
hereto. The Closing shall not violate any order, decree or judgment of any court
or governmental body having competent jurisdiction.
9.4 Deliveries. Purchaser shall have made or tendered, or caused to be
made or tendered, delivery to Seller of the Purchase Price and the documents set
forth in Section 3.4.
ARTICLE X - ADDITIONAL COVENANTS
10.1 Intercompany Accounts. Through the Closing, Seller shall continue to
employ cash management practices consistent with those employed immediately
prior to the date of this Agreement. All collection, concentration, imprest and
disbursement bank accounts used in the Business and the balances therein
existing as of Closing, shall be retained by Seller, provided that all monies
received by Seller relating to the Assets or the Business purchased hereunder
after
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the Closing shall promptly be remitted to Purchaser. Seller shall also retain
liability with respect to all checks or other drafts or withdrawals written on
all such disbursement accounts prior to the Closing and shall either retain
balances in such accounts at Closing to cover such checks, drafts or withdrawals
or shall reimburse Purchaser as soon as practicable after Closing for such
checks, drafts or withdrawals paid by Purchaser. This Section shall not affect
the purchase price adjustment contemplated by Section 2.3 hereof.
10.2 Access Pending Closing. Seller shall, at all reasonable times prior
to Closing, make the plants, properties, inventories, contracts, commitments,
books and records (including computer files, retrieval programs and related
documentation) of Seller (to the extend pertinent to the Business) fully
available during normal business hours to Purchaser, its representatives,
financial advisors, lenders and auditors, and Seller shall furnish or cause to
be furnished to Purchaser and its representatives during such period all such
information and data concerning the same as Purchaser or such representatives
may reasonably request.
10.3 Books and Records. From and after the Closing, Purchaser shall
provide Seller and its representatives with reasonable access (for the purpose
of examining and copying) during normal business hours, to the books and records
of the Business pertaining to periods or occurrences prior to the Closing Date.
Without limiting the foregoing, Purchaser shall preserve and keep any such books
and records it may retain with respect to the Business for a period of seven (7)
years after the Closing or for any longer period: (a) as may be required by any
federal, state or other governmental body or agency or any contract or
agreement; (b) as may be reasonably necessary in respect of the prosecution of
defense of any suit, action, litigation or administrative, arbitration or other
proceeding or investigation that is then pending or threatened; or (d) that is
equivalent to the period established by any applicable statute of limitations
(or any extension or waiver thereof) with respect to matters pertaining to
taxes. If Purchaser wishes to destroy any records referred to herein after that
time, it shall first give 60 days prior written notice to the other, and Seller
shall have the option, upon written notice given to Purchaser within such 60 day
period, to take possession of such records within 30 days after the date of its
notice requesting the same.
10.4 Confidentiality.
(a) In addition to the terms, provisions and covenants of any and
all confidentiality agreements that Purchaser has executed or made
pertaining or relating to the transactions contemplated hereby (the
"Confidentiality Agreement"), which Confidentiality Agreement shall remain
in full force and effect until Closing, Purchaser acknowledges that, in
the course of its investigations of the Business, Purchaser and its
representatives ("Purchaser's Representatives") have and will become aware
of confidential information and documents of the Business, and that its
use of such confidential information and documents, or communication of
such information to third parties, could be detrimental to the Business.
Purchaser covenants that prior to Closing all information and documents
concerning the Business reviewed by Purchaser or its Representatives in
connection with this Agreement or the transactions contemplated
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hereby shall be maintained in confidence and shall not be disclosed or
used by Purchaser or Purchaser's Representatives without Seller's prior
consent, unless such information is either (i) otherwise publicly
available, (ii) required to be disclosed pursuant to judicial order or
law, or (iii) the transactions contemplated herein have been consummated
with Purchaser and such use or disclosure will not materially adversely
affect Seller's use or sale of the Excluded Assets. In the event that the
transactions contemplated herein are not consummated, (i) Purchaser shall
return, all information and documents concerning the Business received by
Purchaser (including any copies thereof or extracts therefrom), (ii)
Purchaser shall keep confidential and shall not use any such information
or documents unless required to disclose such information or documents
pursuant to judicial order, regulation or law. In the event that Purchaser
or any of Purchaser's Representatives becomes legally compelled to
disclose any such information or documents, Purchaser will provide Seller
with prompt written notice before such disclosure, sufficient to enable
Seller either to seek a protective order, at their sole expense, or other
appropriate remedy preventing or prohibiting such disclosure, or to waive
compliance with the provisions of this Agreement or both, and (iii)
neither Purchaser nor Seller shall disclose to any third party the reasons
why the transactions contemplated herein were not consummated.
(b) In addition to the terms, provisions and covenants of any and
all confidentiality agreements that Seller has executed or made pertaining
or relating to the transactions contemplated hereby (the "Confidentiality
Agreement"), which Confidentiality Agreement shall remain in full force
and effect until Closing, Seller acknowledges that, in the course of its
negotiations with Purchaser concerning the sale of the Business, Seller
and its representatives ("Seller's Representatives") have and will become
aware of confidential information and documents relating to Purchaser and
its affiliates, and that its use of such confidential information and
documents or communication of such information to third parties, could be
detrimental to Purchaser and its affiliates. Seller covenants that all
information and documents concerning Purchaser and its affiliates
disclosed to Seller or any Seller Representative in connection with this
Agreement or the transactions contemplated hereby shall be maintained in
confidence and shall not be disclosed or used by Seller or any Seller
Representative without Purchaser's prior consent, unless such information
is either (i) otherwise publicly available, or (b) required to be
disclosed pursuant to judicial order or law. In the event that Seller or
any Seller Representative becomes legally compelled to disclose any such
information or documents, Seller will provide Purchaser with prompt
written notice before such disclosure, sufficient to enable Purchaser
either to seek a protective order, at its sole expense, or other
appropriate remedy preventing or prohibiting such disclosure, or to waive
compliance with the provisions of this Agreement or both.
(c) The parties agree that no press release or other public
statement concerning the negotiation, execution and delivery of this
Agreement or the transactions contemplated hereby shall be issued or made
without the prior approval of both Seller and Purchaser (which approval
shall not be unreasonably withheld), except as required by the rules of
any Stock Exchange or applicable law or regulation. Without limiting the
foregoing, the
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parties agree that the terms of the transaction contemplated herein will
be kept strictly confidential and shall not be disclosed to Purchaser's
customers or competitors.
10.5 Filings: Cooperation. Prior to the Closing, the parties shall proceed
with due diligence and in good faith to make such filings and take such other
actions as may be necessary to satisfy the conditions to Closing set forth
herein. On or 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, including contract
assignments, providing access to personnel, and doing any and all such other
things as may be reasonably required by the parties or their counsel to
consummate or otherwise implement the transactions contemplated by this
Agreement and to allow the orderly transition of the Business to the Purchaser.
In connection with the liabilities assumed by Purchaser pursuant to this
Agreement, and the retention by Seller of all other liabilities not specifically
assumed by Purchaser, each of the parties hereto shall, and shall cause their
affiliates and employees to, cooperate with and assist the other party or
parties in their defense of such assumed or retained litigation or liabilities,
by, among other things, providing such other party or parties with full access
to pertinent records at such times as such other party or parties may reasonably
request, and making available for depositions, testimony, interviews or other
consultation, such officers, employees, or agents as such party or parties may
reasonably request without cost to such party or parties except for
reimbursement by it or them of reasonable out-of-pocket expenditures incurred in
connection with such cooperation and assistance. Without limiting the foregoing,
Purchaser shall make available at no cost to Seller a segregated area within the
facility to collect and organize documents relating to the matters disclosed in
Schedule 4.5.
10.6 Risk of loss. All risk of loss with respect to the Assets shall
remain with Seller until the Closing Date. If at any time after the date of this
Agreement and prior to the Closing Date, the Assets, or any material portion
thereof, are damaged by fire or other casualty or are taken or appropriated by
virtue of eminent domain or similar proceedings, Purchaser may at its option
terminate this Agreement. If Purchaser elects to keep this Agreement in full
force and effect, Purchaser shall be entitled to receive all insurance or
condemnation proceeds payable to Seller or an affiliate of Seller with respect
to such damaged, taken or appropriated Assets.
10.7 Conflicting Proprietary Rights; Assignment; License. Except as
required by existing licenses, on or before Closing Seller will permanently
discontinue, and will cause all their affiliates permanently to discontinue, all
use of any Intellectual Property Rights to be assigned to Purchaser pursuant to
this Agreement. Without limiting the foregoing, Seller shall take all
appropriate action to change its corporate name to remove all reference to the
word "Xxxxxxx Xxxxxx Electronics".
10.8 Transitional Use of Trademarks. Seller recognizes that certain
inventory, labels, containers, stationery and promotional material relating to
such inventory, being assigned to Purchaser under this Agreement may bear
trademarks and trade names not being assigned or licensed to Purchaser. Seller
agrees that Purchaser will be permitted to sell such inventory and use such
labels, containers, stationery and promotional material for a reasonable period
not to
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exceed six (6) months after the Closing. Neither Seller nor any of its
affiliates shall have any liability for products manufactured or sold by
Purchaser containing or utilizing such labels, containers, stationery or
promotional materials.
10.9 Contracts. Purchaser agrees that, except as expressly provided
herein, Seller has made no representations or warranties regarding the Contracts
whatsoever, which, except as expressly provided herein, are being purchased "as
is". Purchaser acknowledges that there can be no assurance that the parties to
the Contracts will consent to assignments or novation or otherwise cooperate so
as to allow Purchaser to perform the Contracts and all such risks are to be
borne by Purchaser. Furthermore, the parties agree that, notwithstanding the
contemplated Closing or the other transactions contemplated hereby, the parties
will take no action that would violate any U.S. or foreign law, rule or
regulation (including, without limitation, relating to security clearances) and
to the extent necessary the actions contemplated by this Agreement shall be
postponed or amended to prevent any such violation. In no event, however, shall
such postponement or amendment result in a claim by Purchaser or any of its
affiliates against Seller, the risks and costs of such actions being borne
solely by Purchaser. Seller and Purchaser shall cooperate fully with each other
to obtain any required consents, approvals or security clearances necessary or
desirable in connection with the transactions contemplated hereby.
[10.10 Xxxxxxx Xxxxxx South Wind Contract. One of the Contracts is a
contract with an affiliate of Seller, Xxxxxxx Xxxxxx South Wind Corporation
("South Wind"). Pursuant to this Contract, Seller is performing work as a
subcontractor to South Wind, with South Wind being the prime contractor under a
contract with the U.S. Army. In connection with the South Wind contract, and
without limiting Purchaser's other obligations in connection with the Contracts,
Purchaser agrees that all design rights (including, but not limited to parts
lists, drawings, specifications, software codes, acceptance test procedures,
supplier lists, etc.) relating to Seller's work shall be consistent with South
Wind's obligations under its contract with the Army.
Promptly after the Closing, Purchaser shall meet with South Wind to
discuss the status of the South Wind Contract and the steps necessary to improve
performance of the product and prepare a proposal for Phase II production (the
"Project"). At any time thereafter until the award of a contract by South Wind
to Purchaser, South Wind or Purchaser may elect to terminate Purchaser's further
involvement with the Project. In the event of such termination, Purchaser shall
promptly transfer to South Wind all intellectual property (including, without
limitation, know-how, drawings, parts lists, specifications, software costs,
acceptance test procedures and supplier lists in Purchaser's possession or
control) that South Wind may be obligated to deliver under its contract with the
Army and, at no cost to South Wind or Seller, provide all reasonable cooperation
and assistance to allow South Wind to transition to another Supplier to allow
completion of the Project and the same reasonable cooperation to allow South
Wind to competitively bid and perform Phase II production.
10.11 Letters of Credit. Seller and certain affiliates of Seller have
certain reimbursement obligations in connection with the letters of credit set
forth on Schedule 10.11 (the "Letters of Credit"). Purchaser shall, with thirty
(30) days after the Closing, replace the Letters of Credit
22
27
with corresponding letters of credit satisfactory to the customer under the
Contracts requiring such Letters of Credit. Neither Seller nor any of its
affiliates shall have any liability under the replacement Letters of Credit. In
the event that, prior to such replacement, any Letter of Credit is partially or
wholly drawn down, Purchaser shall fully indemnify and hold harmless Seller and
its affiliates for any loss, cost or expense of whatsoever nature arising in
connection with such draw-down.
ARTICLE XI - MISCELLANEOUS
11.1 Expenses. Except as otherwise provided in this Agreement, each party
shall pay all of its costs and expenses incurred in connection with this
Agreement and the consummation of the transactions contemplated hereby.
(a) All notices, requests, demands, and other communications under
this Agreement shall be in writing and delivered in person, sent by
certified or registered mail, postage prepaid, or sent by reputable
courier service or telecopy, and properly addressed as follows:
If to Purchaser, to: Xxxxxxx Xxxxxx Electronics Co.
00 Xxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attn: Xx. Xxxxx Xxxx
cc: Blau, Kramer, Wactlar & Xxxxxxxxx, P.C.
000 Xxxxxxx Xxxxxxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxxx, Esq.
If to Seller, to: BTR Aerospace Group
200 0000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx X0X 0X0
Attn: Xx. Xxxxx Xxxxx
With a copy to: BTR Inc.
Stamford Harbor Park
000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attn: Xxxxx X. Xxxx, Esq.
(b) Any party from time to time may change its address and/or the
designated individual for the purpose of notices to that party by a
similar notice specifying a new
23
28
address and/or designated individual, but no such change shall be deemed
to have been given until it is actually received by the party sought to be
charged with its contents.
(c) All notices and other communications required or permitted under
this Agreement which are addressed as provided in this Schedule 11.2
shall, in the case of personal delivery, be effective upon delivery; in
the case of registered or certified mail shall be effective four (4)
business days following deposit in the mail, postage prepaid; and in the
case of courier or telecopy, when delivery is confirmed in person.
11.3 Entire Agreement. This Agreement (including the Exhibits and
Schedules hereto) and the Confidentiality Agreement contain the entire agreement
between the parties with respect to the transactions contemplated hereby, and
supersedes all written or oral negotiations, representations, warranties,
commitments, offers, bids, bid solicitations, and other understandings prior to
the date hereof.
11.4 Severability. If any provision hereof shall be held invalid or
unenforceable by any court of competent jurisdiction or as a result of future
legislative action, such holding or action shall be strictly construed and shall
not affect the validity or effect of any other provision hereof.
11.5 Assignability. This Agreement shall be binding upon and inure to the
benefit of the successors and assigns of the parties hereto; provided, that,
except as otherwise provided for herein, neither this Agreement nor any right
hereunder may be assigned by Seller or Purchaser without the prior written
consent of the other party.
11.6 Captions. The captions of the various Articles and Sections of this
Agreement have been inserted only for convenience of reference, and shall not be
deemed to modify, explain, enlarge or restrict any provision of this Agreement
or affect the construction hereof.
11.7 Governing Law. The validity, interpretation and effect of this
Agreement shall be governed exclusively by the laws of the State of New York,
without giving effect to the conflict of laws provisions thereof.
11.8 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute a single agreement
24
29
11.9 Remedies cumulative. Except as otherwise expressly limited herein,
the rights, powers and remedies given to any party by this Agreement shall be
in addition to all rights, powers and remedies given to that party by any
statute or rule of law. Any forbearance or failure or delay in exercising any
right, power or remedy hereunder shall not be deemed to be a waiver of such
right, power or remedy, and any single or partial exercise of any right, power
of remedy shall not preclude the further exercise thereof or be deemed to be a
waiver of any other right, power or remedy.
XXXXXXX XXXXXX ELECTRONICS CORPORATION
By:
----------------------------------
Name:
Title:
XXXXXXX XXXXXX ELECTRONICS CO.
By: /s/ [Illegible]
----------------------------------
Name:
Title: SEC'Y.
25
30
SCHEDULE 1.9(c)
BALANCES WITH AFFILIATES
See attached.
31
SCHEDULE 4.5
LITIGATION
On or about March 29, 1995, Seller received a subpoena from the Office of
Inspector General, U. S. Department of Defense, for the production of a large
volume of Seller's documents relating to airplane guidance devices produced by
Seller for the U. S. Navy relating to Seller/Navy contracts for 1988, 1989, 1991
and 1993.
The DOD has not informed Seller of the focus of the DOD'S investigation.
Seller, through its counsel, is working with Seller's staff to respond to the
subpoena and is simultaneously conducting its own investigation into Seller's
activities to determine the subject(s) of the DOD'S investigation. Seller's
investigation is ongoing and will continue after the Closing.
During Seller's investigation, Seller's counsel was informed of
allegations that staff intentionally falsified time entries. It is reported that
such purported deliberate falsifications stopped in early 1991 but resumed early
last year and, therefore, if true, should be assumed to affect time on current
contracts.
32
SCHEDULE 4.7
INCLUDED INTELLECTUAL PROPERTY
1. Tradenames
Xxxxxxx Xxxxxx Electronics Corporation
2. Patents
[None]
3. Trademarks
None
33
SCHEDULE 4.8
COMPLIANCE WITH LAWS
See Schedule 4.5
34
SCHEDULE 4.9
EMPLOYEE BENEFIT PLANS
See attached
35
SCHEDULE OF EMPLOYEE BENEFIT PLANS
EMPLOYEES OF XXXXXXX-XXXXXX ELECTRONICS PARTICIPATE
Xxxxxxx-Xxxxxx Corporation Group Insurance Plan - Plan Number 501
Xxxxxxx-Xxxxxx Corporation Retirement Income Plan - Plan Number 001
36
SCHEDULE 4.14
ACCOUNTS RECEIVABLE
See attached
37
--------------------------------------------------------------------------------
**MR4**
OPERATING UNIT: Xxxxxxx Xxxxxx Electronics - Local - 0875 SCHEDULE: MR4
B A L A N C E S H E E T CURRENCY: USD
PERIOD ENDED : JUN 1995 - = CREDIT
--------------------------------------------------------------------------------
ACTUAL PLAN
PREVIOUS CURRENT ACTUAL CURRENT PERIOD
*** BALANCE SHEET *** YEAR YEAR ----------------------------------------------------------------------------
END END JAN FEB MAR APR MAY JUN PLAN PRIOR YR
------------------------------------------------------------------------------------------------------------------------------------
Inventories 3012 2422 3044 3035 3052 3063 2978 3012 2735 3232
Trade - Accts Receivable 1260 1583 1182 706 774 962 869 1104 795 1901
Trade - Accts Payable -000 -000 -000 -000 -00 -00 -00 -00 -000 -000
Trade - Deposits (Rec'd)/Paid -000 -000 -000 -000 -000 -000 -000 -000 -1043 -680
Trade - Fellow Subs Receivable 104
Trade - Fellow Subs Payable -218 -000 -000 -000 -000 -000 -000 -000 -000 -000
-------------------------------------------------------------------------------------------------
Trade Working Capital 2988 2600 3120 2761 2857 3071 2924 3563 2067 4237
Other Accounts Rec'le/Prepayments 2479 1721 2483 2608 2067 2201 2080 1425 1790 2515
Other Accounts Pay'le/Accruals -1101 -000 -000 -000 -000 -000 -000 -000 -00 -000
Other Fellow Subs Receivable
Other Fellow Subs Payable
-------------------------------------------------------------------------------------------------
Trade Working Capital 4366 4111 5247 5034 5001 4975 4679 4676 3779 0000
Xxxxx Xxxx
Xxxx & Xxxxxxxxx 00 00
Other Fixed Assets 266 240 262 270 265 261 260 256 219 270
Investments
Intangibles
-------------------------------------------------------------------------------------------------
Net Assets Employed 4632 4371 5509 5304 5266 5236 4939 4932 4018 6044
Taxation 622 -206 718 819 299 405 504 556 211 96
Dividends
Post Retirement Benefits -000 -000 -000 -000 -000 -000 -000 -000
Profits Levy Paid
-------------------------------------------------------------------------------------------------
Total 5254 3356 5418 5314 4738 4814 4616 4661 3404 6140
=================================================================================================
Share Capital -11923 -11923 -11923 -11923 -11923 -11923 -11923 -11923 -11923 -11923
Funding Loan Int-co - Region 5605 8141 5274 5515 5694 5506 5497 5354 7537 5437
Funding Loan Int-co - Ex Region
Share in Subsidiaries
Goodwill on Consolidation
Reserves -1083 -000 -000 -000 -000 -000 -000 -000 -000 -1050
Retained Profit-Current Year 902 189 137 283 430 583 725 975 545 126
Deferred Tax / FITH 1208 945 1208 1194 1194 1194 1194 1154 1145 1306
Minority Interests
Short Term Deposits
Loan Capital
Bank Loans. O/D & Cash Balances 37 5 67 -216 34 -7 00 -00 0 -00
-------------------------------------------------------------------------------------------------
Total -5254 -3356 -5418 -5314 -4738 -4814 -4626 -4661 -3404 -6140
------------------------------------------------------------------------------------------------------------------------------------
DATE ISSUED: 19/07/95 - 11:26:08
38
SCHEDULE 4.16
GOVERNMENT CONTRACTS
39
SCHEDULE 7.1
EMPLOYEES
40
Xxxxxxx Xxxxxx Electronics Corp.
Employees Retained
Schedule 7.1
--------------------------------------------------------------------------------
LAST FIRST MI SALARY TITLE
--------------------------------------------------------------------------------
Xxxx Xxxxx L 48,528 Section Engineer
--------------------------------------------------------------------------------
Xxxxx Xxxxxxx X 51,024 Section Engineer
--------------------------------------------------------------------------------
Brand Xxxxx D 47,112 Mgr. Contract Administration
--------------------------------------------------------------------------------
Xxxxxxxxx Xxxxxxx 50,436 Section Engineer
--------------------------------------------------------------------------------
Xxxxxx Xxxxxx L 34,200 Manufacturing Engineer
--------------------------------------------------------------------------------
XxxXxxxx Xxxxxxx 32,160 Engineer
--------------------------------------------------------------------------------
Xxxxxx Xxxx L 42,480 Project Engineer
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxxx E 54,984 Section Engineer
--------------------------------------------------------------------------------
Xxxxx Xxxxxxx T 48,756 Dir. Quality Control
--------------------------------------------------------------------------------
XxXxx Xxxxx 32,052 Xxxxxxx (Assembly)
--------------------------------------------------------------------------------
Xxxxxx Xxxx B 42,276 Project Engineer (ARA63)
--------------------------------------------------------------------------------
Xxxx Xxxxxx K 37,896 Manager, Accounting
--------------------------------------------------------------------------------
Xxxxx Xxxxxxxx 36,312 Manager, Technical Documentation
--------------------------------------------------------------------------------
Xxxxxxxxxxx Xxxxxx D 62,100 Director, Military & Aircraft
--------------------------------------------------------------------------------
Xxxxxx Xxxxxx D 39,600 Engineer
--------------------------------------------------------------------------------
Xxxxxxxx Xxxxxxx M 22,360 Jr. Accountant, Part Time
--------------------------------------------------------------------------------
Xxxxxxxx Xxxx 27,690 Assistant Engineer
--------------------------------------------------------------------------------
Xxxxxxxx Xxxxxx P 27,914 Assistant Engineer
--------------------------------------------------------------------------------
Lu Lac 22,714 Assistant Engineer
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxx C 26,688 Assistant Engineer
--------------------------------------------------------------------------------
Xxxxxxxx Xxxxxxxx 32,864 Sr. Eng. Mechanic
--------------------------------------------------------------------------------
Xxxxxx Xxxx T 36,528 Mgr. Systems & Programming
--------------------------------------------------------------------------------
41
SCHEDULE 9.5
LETTERS OF CREDIT, ETC.
42
[Letterhead of NationsBank]
July 28, 1995
NationsBank
BTR Inc.
000 Xxxx Xx.
Xxxxxxxx, XX 00000
Attn: Xx. Xxxxxxxx Xxxxxxx
Phone/Fax.: (000) 000-0000/000-0000
Dear Xx. Xxxxxxx:
Re: Xxxxxxx Xxxxxx Electronics Corporation
Per your request, we hereby confirm that the up-to-date outstanding
Letter(s) of Credit balance for account of BTR Inc./Xxxxxxx Xxxxxx Electronics
Corporation is US $1,454,228.79; details as follow (all Standby Letter of
Credit):
LC No Amount (USD) Issued Date Expiry Date Remarks
----- ------------ ----------- ----------- -------
39148 273,986.00 12/30/82 10/28/95
39147 39,000.00 12/30/92 10/30/95
39539 12,850.00 05/10/93 12/15/95
39745 38,066.00 07/16/93 09/27/95
39746 48,800.00 07/16/93 01/27/96 Auto-Renew till Final 11/30/99
39747 16,650.00 07/16/93 11/20/95
40275 13,509.00 01/13/94 05/15/96
40276 3,919.00 01/13/94 06/15/96
40841 168,540.00 08/05/94 12/28/95
41184 90,678.00 12/01/94 05/28/96
41185 18,645.00 01/01/94 10/31/96 Auto-Renew till Final 10/31/98
41321 16,550.00 01/19/95 05/31/96 Auto-Renew till Final 05/31/99
41322 187,304.68 01/19/95 11/27/96
41710 8,604.20 06/14/95 10/01/96
41711 9,728.00 06/14/95 04/12/96
41712 105,034.86 06/14/95 03/27/96
41713 215,651.00 06/14/95 08/29/96 Auto-Renew till Final 08/29/97
41714 18,936.70 06/14/95 12/31/96 Auto-Renew till Final 12/31/99
41715 105,411.00 06/14/95 03/30/96 Auto-Renew till Final 03/30/97
41716 9,468.40 06/14/95 12/31/96 Auto-Renew till Final 12/31/99
41772 58,400.00 07/07/95 05/28/96
------------
Total: 1,454,228.79 (21 Letters of Credit)
If you have any questions, please feel free to call us,
Very truly yours,
[Illegible]
------------------------
Authorized Signature
USA
[Logo]
Official Sponsor
1994/199[Illegible]
43
GUARANTY
THIS GUARANTY dated July 28, 1995 by BTR Dunlop, Inc., a Delaware
corporation ("Guarantor").
WITNESSETH:
WHEREAS, Xxxxxxx Xxxxxx Electronics Corporation, a Delaware corporation
and a subsidiary of Guarantor ("Seller"), and Xxxxxxx Xxxxxx Electronics Co., a
Pennsylvania corporation ("Purchaser"), have concurrently herewith entered into
a Purchase and Sale Agreement pursuant to which Purchaser has agreed to acquire
certain assets of Seller and assume certain liabilities (the "Asset Purchase
Agreement"); and
WHEREAS, it is a condition to Purchaser's obligations under the Asset
Purchase Agreement that Guarantor shall have executed and delivered this
Guaranty;
NOW, THEREFORE, for good and valuable consideration, receipt of which is
hereby acknowledged, and in order to induce Purchaser to enter into the Asset
Purchase Agreement, Guarantor covenants and agrees as follows:
1. Subject to Section 4 hereof:. (a) Guarantor hereby unconditionally and
irrevocably guarantees to Purchaser and its successors and assigns the due,
punctual and full satisfaction, payment and performance when and as due of each
of the representations, warranties, covenants, conditions, agreements and
obligations of Seller (the "Obligations") set forth in the Asset Purchase
Agreement. If Seller shall fail to satisfy any part or all of the Obligations
when due, Guarantor will promptly satisfy and discharge all such obligations in
full.
(b) The Obligations and the liability of Guarantor under this Guaranty are
continuing, irrevocable, absolute and unconditional without regard to the
liability of any other person under all circumstances and (i) are not
conditioned or contingent upon, and are irrespective of the pursuit by Purchaser
of whatsoever remedies there may be against Seller (or any other obligor upon
the Obligations, any other guarantor or any security for any or all of the
Obligations) and (ii) will not be discharged or affected by any circumstance
(other than complete satisfaction of the Obligations) which might constitute a
legal or equitable discharge. Guarantor's guarantee made pursuant to this
Guaranty shall be a continuing guarantee of any and all instruments given in
extension or renewal or substitution for the Obligations.
(c) Guarantor agrees that, in the event that any of the Obligations are
paid, Guarantor's liability under this Guaranty shall continue and remain in
full force and effect in the event that all or any part of said payment is
recovered from Purchaser or any other payee under any applicable bankruptcy or
insolvency or other law affecting or available to creditors or their
representatives.
44
2. Guarantor hereby represents and warrants that this Guaranty has been
duly authorized and approved by all necessary corporate action of Guarantor, has
been duly executed and delivered by Guarantor, and constitutes a valid and
binding obligation of Guarantor enforceable against Guarantor in accordance with
its terms.
3. (a) This Guaranty may not be assigned by Guarantor without the prior
written consent of Purchaser. This Guaranty shall be binding upon Guarantor and
its successors and assigns.
(b) This Guaranty constitutes the entire understanding of the parties
relating to the subject matter hereof and supersedes all prior and
contemporaneous agreements and understandings, whether oral or written, relating
to the subject matter hereof. No amendment or modification of the terms of this
Guaranty shall be binding or effective unless expressed in writing and signed by
both Guarantor and Purchaser.
(c) The waiver by Purchaser of the breach of any of the terms and
conditions of, or any right under, this Guaranty shall not be deemed to
constitute the waiver of any other breach of the same or any other term or
condition or of any similar right. No such waiver shall be binding or effective
unless expressed in writing and signed by Purchaser.
(d) This Guaranty shall be governed by and construed in accordance with
the laws of the State of New York applicable to contracts made and performed
wholly within the State of New York.
4. Notwithstanding anything to the contrary contained herein, the
obligations of Guarantor hereunder shall in no event exceed $250,000, and when
and if Guarantor has paid such amount, all obligations hereunder shall cease and
be of no further effect provided, however, that Guarantor's obligations shall be
unlimited with respect to the obligations of Seller contained in Section 6.1(i)
(Bulk Sales) and Section 6. 1(j) (DOD Subpoena).
IN WITNESS WHEREOF, Guarantor has executed this Guaranty as of the day
and year first above written.
BTR DUNLOP, INC.
BY: /s/ [Illegible]
-----------------------------
45
GUARANTY
THIS GUARANTY dated July 28, 1995 by Xxxxxx Industries, Inc., a Delaware
corporation ("Guarantor").
WITNESSETH:
WHEREAS, Xxxxxxx Xxxxxx Electronics Co., a Pennsylvania corporation and a
subsidiary of Guarantor ("Purchaser"), and Xxxxxxx Xxxxxx Electronics
Corporation ("Seller") have concurrently herewith entered into a Purchase and
Sale Agreement pursuant to which Purchaser has agreed to acquire certain assets
of Seller and assume certain liabilities (the "Asset Purchase Agreement");
WHEREAS, the terms used in this Guaranty shall be as defined in the Asset
Purchase Agreement; and
WHEREAS, it is a condition to Seller's obligations under the Asset
Purchase Agreement that Guarantor shall have executed and delivered this
Guaranty;
NOW, THEREFORE, for good and valuable consideration, receipt of which is
hereby acknowledged, and in order to induce Seller to enter into the Asset
Purchase Agreement, Guarantor covenants and agrees as follows:
1. (a) Guarantor hereby unconditionally and irrevocably guarantees to
Seller and its successors and assigns the due, punctual and full satisfaction,
payment and performance when and as due of each of the representations,
warranties, covenants, conditions, agreements and obligations of Purchaser (the
"Obligations") set forth in Sections 2.4(a), 2.4(b) and 2.4(d) and Section 10.11
of the Asset Purchase Agreement. If Purchaser shall fail to satisfy any part or
all of the Obligations when due, Guarantor will promptly satisfy and discharge
all such obligations in full.
(b) The Obligations and the liability of Guarantor under this
Guaranty are continuing, irrevocable, absolute and unconditional without regard
to the liability of any other person under all circumstances and (i) are not
conditioned or contingent upon, and are irrespective of the pursuit by Seller of
whatsoever remedies there may be against Purchaser (or any other obligor upon
the Obligations, any other guarantor or any security for any or all of the
Obligations) and (ii) will not be discharged or affected by any circumstance
(other than complete satisfaction of the Obligations) which might constitute a
legal or equitable discharge. Guarantor's guarantee made pursuant to this
Guaranty shall be a continuing guarantee of any and all instruments given in
extension or renewal or substitution for the Obligations.
(c) Guarantor agrees that, in the event that any of the Obligations
are paid, Guarantor's liability under this Guaranty shall continue and remain in
full force and effect in the event that all or any part of said payment is
recovered from Seller or any other payee under any applicable bankruptcy or
insolvency or other law affecting or available to creditors or their
representatives.
46
2. Guarantor hereby represents and warrants that this Guaranty has been
duly authorized and approved by all necessary corporate action of Guarantor, has
been duly executed and delivered by Guarantor, and constitutes a valid and
binding obligation of Guarantor enforceable against Guarantor in accordance with
its terms.
3. (a) This Guaranty may not be assigned by Guarantor without the prior
written consent of Seller. This Guaranty shall be binding upon Guarantor and its
successors and assigns.
(b) This Guaranty constitutes the entire understanding of the
parties relating to the subject matter hereof and supersedes all prior and
contemporaneous agreements and understandings, whether oral or written, relating
to the subject matter hereof. No amendment or modification of the terms of this
Guaranty shall be binding or effective unless expressed in writing and signed by
both Guarantor and Seller.
(c) The waiver by Seller of the breach of any of the terms and
conditions of, or any right under, this Guaranty shall not be deemed to
constitute the waiver of any other breach of the same or any other term or
condition or of any similar right. No such waiver shall be binding or effective
unless expressed in writing and signed by Seller.
(d) This Guaranty shall be governed by and construed in accordance
with the laws of the State of New York applicable to contracts made and
performed wholly within the State of New York.
IN WITNESS WHEREOF, Guarantor has executed this Guaranty as of the day and
year first above written.
XXXXXX INDUSTRIES, INC.
BY: /s/ [Illegible] CEO
------------------------------
47
LEASE
THIS LEASE is made as of the 28th day of July, 1995, by and between
XXXXXXX XXXXXX CORPORATION ("Landlord") and XXXXXXX XXXXXX ELECTRONICS CO.
("Tenant"), who hereby mutually covenant and agree as follows:
X. XXXXX, TERM, DEFINITIONS AND BASIC PROVISIONS
1.0 Grant. Landlord, for and in consideration of the rents and other sums
herein reserved and of the covenants and agreements herein contained on the part
of the Tenant to be performed, hereby leases to Tenant, and Tenant hereby lets
from Landlord, the improved real estate described in Exhibit A attached hereto,
together with all real property improvements and appurtenances belonging to or
in any way pertaining to the same (collectively, the "Leased Premises").
1.1 Lease Term. The term of this Lease shall commence on the date hereof
(the "Commencement Date") and shall terminate ninety (90) days from the date
hereof (the "Initial Period"); provided, however, that Tenant may elect to
extend the term for three additional periods of 30 days (each such period an
"Option Period"), with time of the essence, by delivering notice of such
election to extend no later than 20 days prior to the end of the Initial Period
or the then current Option Period.
1.2 Basic Lease Provisions.
(a) Purpose (See Section 3.0):
(b) Base Rent (See Section 4.0):
Base Rent: $0 during the Initial Period
$25,000 for each Option Period
(c) Payee (See Section 4.0): Xxxxxxx Xxxxxx Electronics
Corporation
(d) Payee's Address: Xxxxxxx Xxxxxx Electronics Corporation
c/o BTR Inc.
000 Xxxxxx Xxxxxx
Xxxxxxxx Xxxxxx Xxxx
Xxxxxxxx, XX 00000
(e) Form of Insurance (See Article VI): The insurance specified in
Section 6.0 of this Lease shall insure Landlord, in addition
to Tenant.
48
(f) Tenant's Address: c/x Xxxxxx Industries, Inc.
00 Xxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
(h) Landlord's Address: 000 Xxxxxx Xxxxxx
Xxxxxxxx Xxxxxx Xxxx
Xxxxxxxx, XX 00000
II. POSSESSION
Tenant hereby accepts the Leased Premises in its "AS IS" condition.
Neither Landlord nor any agents or employees of Landlord have made any
representations or warranties, direct or indirect, oral or written, express or
implied, to Tenant or any agents or employees of Tenant with respect to the
condition of the Leased Premises, its fitness for any particular purposes, or
its compliance with any laws, and Tenant is not aware of and does not rely upon
any such representation to any other party. Tenant acknowledges that no
representation as to the condition an repair of the Leased Premises has been
made by or on behalf of Landlord prior to or at the execution of this Lease that
is not herein expressed. Tenant's taking possession shall be conclusive evidence
that the Leased Premises were suitable for Tenant's intended purposes as of the
date thereof and that Tenant has waived all claims relating to the condition of
the Leased Premises.
III. PURPOSE
The Leased Premises shall be used and occupied only for purposes similar
to the uses of the Leased Premises immediately prior to the Commencement Date,
except that no such use shall (a) constitute a public or private nuisance or
waste, (b) render the insurance on the Leased Premises void or the insurance
risk more hazardous, or (c) be unlawful.
IV. RENT
4.0 Base Rent. Beginning with the Commencement Date, Tenant shall pay base
rent as set forth in Section 1.2(b) hereof, payable in advance, as set forth in
said Section, without any prior demand therefor and without any offset or
deduction whatsoever. Base Rent shall be prorated for partial months within the
term. All charges, costs and sums required to be paid by Tenant to Landlord
under this Lease in addition to Base Rent shall be deemed additional rent
("Additional Rent") , and Base Rent and Additional Rent shall hereinafter be
collectively called "Rent". Tenant's covenant to pay Rent shall be independent
of every other covenant in this Lease. Rent shall be paid to or upon the order
of Payee at the Payee's Address. Landlord shall have the right to change the
Payee or the
-2-
49
Payee's Address by giving written notice thereof to Tenant. All payments of rent
shall be made without deduction, set off, discount or abatement in lawful money
of the United States
4.1 Interest on Late Payments and Late Charges. Each and every payment of
charges due hereunder, which shall not be paid when due shall bear interest at
the rate of ten percent (10%) per annum or the maximum rate of interest
permitted by law whichever is less, from the date when same is payable under the
terms of this Lease until the same shall be paid. Additionally, a late charge of
two percent (20%) of all delinquent Rent shall be paid to Landlord by Tenant.
V. INTENTIONALLY OMITTED
VI. INSURANCE
6.0 Kinds and Amounts. During the term of this Lease, Tenant shall procure
and maintain policies of insurance, at its sole cost and expense, insuring
Landlord and Tenant from all liability, claims, demands or actions for bodily
injury or property damage in an amount of not less than $1,000,000, combined
single limit made by, or on behalf of, any person or persons, firm or
corporation arising from, related to or connected with the Leased Premises.
Landlord shall be responsible for maintaining casualty insurance on the Leased
Premises at its own cost and expense.
6.1 Form of Insurance. The aforesaid insurance shall be issued by
companies qualified to do business in the state in which the Leased Premises are
located and shall be in form, substance an amount reasonably satisfactory to
Landlord, and shall contain standard loss payee clauses satisfactory to
Landlord. The aforesaid insurance shall not be subject to cancellation or
non-renewal by either the insurance carrier or the insured except after at least
thirty (30) days prior written notice to Landlord. Prior to the Commencement
Date, certificates of insurance shall be deposited with Landlord, naming
Landlord as additional insured.
6.2 Fire Protection. Tenant shall take no action which would result in a
violation of all applicable fire codes of any governmental authority.
6.3 Mutual Waiver of Subrogation Rights. Whenever (a) an loss, cost,
damage or expense resulting from fire, explosion or an other casualty or
occurrence is incurred by either of the parties to this Lease, or anyone
claiming by, through, or under it in connection with the Leased Premises, and
(b) such party is then covered in whole or in part by insurance with respect to
such loss, cost, damage or expense or is required under this Lease to be so
insured, then the party so insured (or so required) hereby releases the other
party from any liability said other party may have on account of such loss,
cost, damage or expense to the extent of any amount recovered by reason of such
insurance (or which could
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50
have been recovered had such insurance been carried as so required) and waives
any right of subrogation which might otherwise exist in or accrue to any person
on account thereof, provided that such release of liability and waiver of the
right of subrogation shall not be operative in any case where the effect thereof
is to invalidate such insurance coverage.
VII. DAMAGE OR DESTRUCTION
If the Leased Premises are damaged or destroyed and rendered partially or
wholly untenantable for their accustomed use by fire or other casualty, the term
of this Lease shall terminate as of the date of said casualty.
VIII. CONDEMNATION
In the event that any portion of the Leased Premises is taken by any
public authority under power of eminent domain or is conveyed under threat of
such taking (or any part of the Lease Premises is so taken or conveyed which
would necessitate a reduction of square footage in the improvements on the Lease
Premises which are occupied by Tenant) , the term of this Lease shall terminate
as of the date of the taking or conveyance and the Landlord shall be entitled to
the entire condemnation award.
IX. MAINTENANCE AND ALTERATIONS
9.0 Maintenance. Tenant shall keep and maintain the improvements at any
time situated upon the Leased Premises, the entire parking area on the Leased
Premises and all sidewalks and areas adjacent thereto, safe, secure, clean and
sanitary (including without limitation, snow and ice clearance), and in
compliance in all material respects with all lawfully promulgated health, safety
and police regulations in force provided, however, that Tenant shall not be
responsible for any repair obligations in excess of $1,000 in any one instance
or $10,000 in the aggregate.
9.1 Alterations. Tenant shall make no additions, improvements or
alterations to the Leased Premises.
X. ASSIGNMENT AND SUBLETTING
Tenant will not sell, assign, mortgage, pledge or in any manner transfer
any of its interest in this Lease or sublet any portion of the Leased Premises.
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XI. LIENS AND ENCUMBRANCES
11.0 Encumbering Title. Tenant shall not do any act which shall in any way
encumber Landlord's interest or in and to the Leased Premises, nor shall the
interest or estate of Landlord in the Leased Premises in any way become subject
to any claim by way of lien or encumbrance, whether by operation of law or by
virtue of any express or implied contract by Tenant. Any claim to, or lien upon,
the Leased Premises arising from any act or omission of Tenant other than a
claim by Landlord, shall accrue only against the leasehold estate of Tenant and
shall be subject and subordinate to the paramount title and rights of Landlord
in and to the Leased Premises.
11.1 Liens and Right to Contest. Tenant shall not permit the Leased
Premises to become subject to any mechanics', laborers', or materialmen's lien
on account of labor or material furnished to Tenant or claimed to have been
furnished to Tenant in connection with work of any character performed or
claimed to have been performed for the Leased Premises by, or at the direction
or sufferance of, Tenant; provided, however, that Tenant shall have the right to
contest, in good faith and with reasonable diligence, the validity of any such
lien or claimed lien if Tenant shall give to Landlord such security as may be
reasonably satisfactory to Landlord to assure payment thereof and to prevent any
sale, foreclosure, or forfeiture of Landlord's interest in the Lease Premises by
reason of non-payment thereof; provided further, however, that on final
determination of the lien or claim for lien, Tenant shall immediately pay any
judgment rendered, with all proper costs and charges, and shall have the lien
released and any judgment satisfied.
XII. UTILITIES
Landlord shall purchase all utility services, including without
limitation, fuel, water, sewerage and electricity, from the utility or
municipality providing such service, and shall pay for such services when such
payments are due. Tenant shall take no action that would cause the use of such
service to increase materially over recent historical levels.
XIII. INDEMNITY AND WAIVER
13.0 Tenant's Indemnity. Tenant will protect, indemnify and save harmless
Landlord, and its agents, employees, officers an directors, from and against all
liabilities, obligations, claims, damages, penalties, causes of action, costs
and expenses (including, without limitation, reasonable attorneys, fees an
expenses) imposed upon or incurred by or asserted against Landlord by reason of
(a) any accident, injury to or death of persons or loss of or damage to property
occurring on or about the Leased Premises or any part thereof, or resulting from
any act or omission of Tenant or anyone claiming by, through, or under Tenant
during the Lease Term; (b) any failure on the part of Tenant to perform or
comply with any of the terms of this Lease; (c) the performance of any labor or
services or the
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furnishing of any materials or other property in respect of the Leased Premises
or any part thereof performed by or on behalf of Tenant during the Lease Term;
or (d) claims, losses, damages, response costs, clean-up costs and expenses
arising out of or in any way relating to the introduction by Tenant of Hazardous
Materials, as defined hereinbelow, over, beneath, in or upon the Leased
Premises, including, without limitation, (i) claims of third parties (including
governmental entities) for damaged, penalties, response costs, clean-up costs,
injunctive or other relief; (ii) costs and expenses of removal and restoration
including fees and costs of attorneys and experts, and costs of reporting the
existence of Hazardous Materials to any governmental agency; and (iii) any and
all expenses or obligations, including, without limitation, reasonable
attorneys' fees and costs, witness fees, deposition costs, copying and telephone
charges and other expenses, all of which shall be paid by the Tenant when
incurred. For purposes of this Lease, the term "Hazardous Materials" shall mean
and include any hazardous, toxic or dangerous waste substance or material
defined as such in or for purposes of the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 (42 USC Section 9601, et. seq.), the
Hazardous Materials Transportation Act (49 USC Section 1802, et. seq.) and the
Resource Conservation and Recovery Act (42 USC Section 6901, et. seq.) or any
other federal, state or local statute, law, ordinance, code, rule, regulation,
order or decree regulating, relating to or imposing liability or standards of
conduct concerning any hazardous, toxic or dangerous waste, substance or
material as now or at any time hereafter in effect (collectively, the
"Environmental Laws") Landlord and Tenant agree that the obligations of Tenant
provided herein and elsewhere in this Lease shall survive expiration of the
Lease Term.
13.1 Waiver of Certain Claims. Tenant waives all claims it may have
against Landlord for damage or injury to property sustained by Tenant or any
persons claiming through Tenant or by any occupant of the Leased Premises, or by
any other person, resulting from any part of the Leased Premises or any of its
improvements, equipment or appurtenances becoming out of repair, or resulting
from any accident on or about the Leased Premises or resulting directly or
indirectly from any act of neglect of any person, including Landlord, to the
extent permitted by law. This Section 13.1 shall include, but not by way of
limitation, damage caused by water, snow, frost, steam, excessive heat or cold,
sewage, gas, odors, or noise, or caused by bursting or leaking of pipes or
plumbing fixtures, and shall apply equally whether an such damage results from
the act or neglect of Tenant or any other person, including Landlord, to the
extent permitted by law, and whether such damage be caused by or result from any
thing or circumstance above mentioned or referred to, or to any other thing or
circumstance whether of a like nature or of wholly different nature. All
personal property belonging to Tenant or any occupant of the Leased Premises
that is in or on any part of the Leased Premises shall be at the risk of Tenant
or of such other person only, and Landlord shall not be liable for any damage
thereto or for the theft or misappropriation thereof.
13.2 Landlord's Indemnity. Landlord will protect, indemnify and save
harmless Tenant and its agents, employees, officers and directors, from and
against all liabilities, obligations, claims, damages, penalties, causes of
action, costs and expenses (including
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without limitation, reasonable attorneys' fees and expenses) imposed upon or
incurred by or asserted against Tenant by reason of claims, losses, damages,
response costs, clean-up costs and expenses arising out of or in any way
relating to the introduction by parties other than Tenant of Hazardous
Materials, as defined herein below, over, beneath, in or upon the Leased
Premises, including, without limitation, (i) claims of third parties (including
governmental entities) for damages, penalties, response costs, clean-up costs,
injunctive or other relief; (ii) costs and expenses of removal and restoration,
including fees and costs of attorneys and experts, and costs of reporting the
existence of Hazardous Materials to any governmental agency; and (iii) any and
all expenses or obligations, including without limitation, reasonable attorneys'
fees and costs, witness fees, deposition costs, copying and telephone charges
and other expenses, all of which shall be paid by the Landlord when incurred.
For purposes of this Lease, the term "Hazardous Materials" shall mean and
include any hazardous, toxic or dangerous waste, substance or material defined
as such in or for purposes of the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 (42 USC Section 9601, et. seq.), the
Hazardous Material Transportation Act, (49 USC Section 1802, et. seq.), and the
Resource Conservation and Recovery Act (42 USC Section 6901, et. seq.) or any
other federal, state or local statute, law, ordinance, code, rule, regulation,
order or decree regulating, relating to or imposing liability or standards or
conduct concerning any hazardous, toxic or dangerous waste, substance or
material as now or at any time hereinafter in effect (collectively, the
"Environmental Laws"). Landlord and Tenant agree that the obligations of
Landlord provided herein and elsewhere in this Lease shall survive expiration of
the Lease Term.
XIV. RIGHTS RESERVED TO LANDLORD
Without limiting any other rights reserved or available to Landlord under
this Lease, at law or in equity, Landlord reserves the following rights to be
exercised at Landlord's election:
(a) To enter and/or inspect the Leased Premises and to make repairs,
remediations, additions or alterations to the Lease Premises; and
(b) To show the Leased Premises to persons having legitimate
interest in viewing the same.
(c) To use and occupy, or allow others to use and occupy, the Leased
Premises to the extent necessary to permit continued operation of,
or removal from the Leased Premises of, the so-called line tracing
business provided, however, that such use and occupancy shall not
materially affect Tenant's ability to conduct its operations in the
Leased Premises.
Landlord may enter upon the Leased Premises for any and all of said purposes and
may exercise any and all of the foregoing rights hereby reserved, so long as
such exercise does
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not result in an significant interference in the conduct of Tenant's business,
without being deemed guilty of any eviction or disturbance of Tenant's use or
possession of the Leased Premises, and without being liable in an manner to
Tenant.
XV. QUIET ENJOYMENT
So long as Tenant is not in default under the covenants an agreements of
this Lease, Tenant's quiet and peaceable enjoyment of the Leased Premises shall
not be disturbed or interfered with by Landlord or by an person claiming by,
through or under Landlord.
XVI. SUBORDINATION OR SUPERIORITY
This Lease and Tenant's rights are and shall be subject to any mortgages
or trust deed(s) executed by Landlord against the Leased Premises and to any
amendments, modifications or renewals thereof. Tenant shall execute and deliver
within fifteen (15) days of the request of Landlord or its mortgagee such
acknowledgments or documents as may be requested from time to time in connection
with the financing of the Leased Premises including, without limitation,
subordination and attornment instruments, and estoppel certificates.
Tenant hereby consents in advance to any collateral assignment of this
Lease which Landlord elects, in its sole discretion, to execute, provided that
every such collateral assignment shall provide that the same shall not become
operative except in the event of a default under the note collateralized by this
Lease or under any mortgage securing such note.
XVII. SURRENDER
17.0 Surrender. Upon termination of this Lease, Tenant will at once
surrender and deliver up the Leased Premises, together with all improvements
thereon, to Landlord, in the same condition and repair as at commencement,
reasonable wear and tear excepted. All alterations, temporary or permanent, made
in or upon the Leased Premises by Tenant shall become Landlord's property on any
such termination an shall remain upon the Leased Premises without compensation,
allowance or credit to Tenant; provided, however, that Landlord shall have the
right to require Tenant to remove any alterations (including signage) and
restore the Leased Premises to their condition prior to the making of such
alterations, repairing any damage occasioned by such removal or restoration. If
Landlord requires removal of any alterations and Tenant does not make such
removal in accordance with this Section 17.0 at the time of such termination,
Landlord may remove the same (and repair any damage occasioned thereby), and
dispose thereof or, at its election, deliver the same to any
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other place of business of Tenant or warehouse the same. Tenant shall pay the
costs of such removal, repair, delivery and warehousing to Landlord on demand.
17.1 Removal of Tenant's Property. Upon termination of this Lease, Tenant
shall remove Tenant's articles of personal property incidental to Tenant's
business ("Trade Fixtures"); provided, however, that Tenant shall repair any
injury or damage to the Leased Premises which may result from such removal, and
shall restore the Leased Premises to the same condition as prior to the
installation thereof. If Tenant does not remove Tenant's Trade Fixtures from the
Leased Premises, as aforesaid, Landlord may, at its option, remove the same (and
repair any damage occasioned thereby) and dispose thereof or deliver the same to
any other place of business of Tenant or warehouse the same, and Tenant shall
pay the cost of such removal, repair, delivery and warehousing to Landlord on
demand, or Landlord may treat such Trade Fixtures as having been conveyed to
Landlord with this Lease as a xxxx of sale, without further payment or credit by
Landlord to Tenant. Notwithstanding the foregoing, provided that no later than
20 days before the end of the term hereof (including any Option Period exercised
by Tenant), Tenant provides Landlord a list of machinery and equipment (but not
inventory) that Tenant does not intend to remove from the Leased Premises and
provided further that such list includes only machinery and equipment conveyed
pursuant to that certain Purchase and Sale Agreement dated of even date herewith
between Landlord and Tenant, Tenant shall not be required to pay the cost of
removal, repair, delivery or warehousing as contemplated in this Section 17.1.
17.2 Holding Over. Tenant shall have no right to occupy the Leased
Premises or any portion thereof after the termination of Tenant's right to
possession pursuant to Section 18.0 hereof. In the event Tenant shall continue
to occupy the Leased Premises or any portion thereof as aforesaid, Tenant shall
be liable for double Rent for said holdover period.
XVIII. REMEDIES
18.0 Defaults. Tenant agrees that any one or more of the following events
shall be considered events of default as said term is used herein:
(a) Tenant shall be adjudged an involuntary bankrupt, or a decree or
order approving, as properly filed, a petition or answer filed against
Tenant asking reorganization of Tenant under the Federal bankruptcy laws
as now or hereafter amended, or under the laws of any state, shall be
entered, and any such decree or judgment or order shall not have been
vacated or set aside within sixty (60) days from the date of the entry or
granting thereof; or
(b) Tenant shall file or admit the jurisdiction of the court and the
material allegations contained in any petition in bankruptcy or any
petition pursuant or purporting to be pursuant to the Federal bankruptcy
laws as now or hereafter amended, or Tenant shall institute any
proceedings for any relief of Tenant under any
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bankruptcy or insolvency laws or any laws relating to the relief of
debtors, readjustment or indebtedness, reorganization, arrangements,
composition or extension; or
(c) Tenant shall make any assignment for the benefit of creditors or
shall apply for consent to the appointment of a receiver for tenant or any
of the property of Tenant; or
(d) The Leased Premises are levied upon by any revenue officer or
similar officer as the result of any act or omission of Tenant; or
(e) A decree or order appointing a receiver of all or substantially
all of the property of Tenant shall be made an such decree or order shall
not have been vacated or set aside within sixty (60) days from the date of
entry or granting thereof; or
(f) Tenant shall abandon the Leased Premises or vacate the same
during the term hereof; or
(g) Tenant shall default in any payment of rent or in an other
payment required to be made by Tenant hereunder when due and for five days
thereafter; or
(h) Tenant shall fail to contest the validity of any lien or claimed
lien and give security to Landlord to assure payment thereof, or, having
commenced to contest the same and having given such security, shall fail
to prosecute such contest wit diligence, or shall fail to have the same
released and satisfy any judgment rendered thereon, and such default
continues for ten (10) days after notice thereof in writing to Tenant; or
(i) Tenant shall default in keeping, observing or performing any of
the other covenants or agreements herein contained to be kept, observed
and performed by Tenant, and such default shall continue for ten (10) days
after notice thereof in writing to Tenant.
Upon the occurrence of any one or more of such events of default, Landlord may,
at its election, terminate this Lease or terminate Tenant's right to possession
only, without terminating the Lease. Upon termination of the Lease, or upon any
termination of the Tenant's right to possession without termination of the
Lease, the Tenant shall surrender possession and vacate the Leased Premises
immediately, and deliver possession thereof to the Landlord, an hereby grants to
the Landlord the full and free right, without demand or notice of any kind to
Tenant (except as hereinabove expressly provided for) , to enter into and upon
the Lease Premises, with or without process of law, and to repossess the Leased
Premises as the Landlord's former estate and to expel or remove the Tenant and
any others who may be occupying the Leased Premises, without being deemed in any
manner guilty
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of trespass, eviction, or forcible entry or detainer, without incurring any
liability for any damage resulting therefrom and without relinquishing the
Landlord's rights to rent or any other right given to the Landlord hereunder or
by operation of law. Upon termination of the Lease, Landlord shall be entitled
to recover as damages all Rent and other sums due and payable by Tenant on the
date of termination, plus (1) an amount equal to the value of the rent and other
sums provided herein to be paid by Tenant for the residue of the stated term
hereof, less the fair rental value of the Leased Premises for the residue of the
stated term (taking into account the time and expenses necessary to obtain a
replacement tenant or tenants, including expenses hereinafter described relating
to recovery of the Leased Premises, preparation for reletting and for reletting
itself) and (2) the cost of performing any other covenants to be performed by
the Tenant. If the Landlord elects to terminate the Tenant's right to possession
only without terminating the Lease, the Landlord may, at the Landlord's option,
enter into the Leased Premises, remove the Tenant's signs, if any, and other
evidences of tenancy, and take and hold possession thereof as hereinabove
provided, without such entry and possession terminating the Lease or releasing
the Tenant, in whole or in part, from the Tenant's obligations to pay the rent
hereunder for the full term or from any other of its obligations under this
Lease. Landlord may, but (except as required by statute) shall be under no
obligation so to do, relet all or any part of the Leased Premises for such rent
and upon such terms as shall be satisfactory to Landlord (including the right to
relet the Leased Premises as part of a larger area and the right to change the
character or use made of the Leased Premises). For the purpose of such
reletting, Landlord may decorate or make any repairs, changes, alterations or
additions in or to the Leased Premises that may be necessary or convenient, All
expenses of decorating, changing, altering an adding to the Leased Premises
shall be borne solely by Landlord. If Landlord does not relet the Leased
Premises, Tenant shall pay to Landlord on demand damages equal to the amount of
the rent an other sums provided herein to be paid by Tenant for the remainder of
the Lease Term as the same shall become due and payable. If the Leased Premises
are relet and a sufficient sum shall not be realized from such reletting after
paying all of the expenses of such reletting and the collection of the rent
accruing therefrom (including, but not by way of limitation, reasonable
attorneys' fees and brokers, commissions), to satisfy the rent and other charges
herein provided to be paid for the remainder of the Lease Term, Tenant shall pay
to Landlord on demand any deficiency as the same shall become due and payable.
Tenant agrees that Landlord may file suit to recover any sums falling due under
the terms of this Section 18.0 from time to time. Tenant shall pay all costs and
expenses, including attorneys, fees and costs, incurred by Landlord in
recovering such sums due hereunder.
18.1 Remedies Cumulative. No remedy herein or otherwise conferred upon or
reserved to Landlord shall be considered to exclude or suspend any other remedy
but the same shall be cumulative and shall be in addition to every other remedy
given hereunder, or now or hereafter existing at law or in equity or by statute,
and every power and remedy given by this Lease to Landlord may be exercised from
time to time and so often as occasion may arise or as may be deemed expedient.
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18.2 No Waiver. No delay or omission of either party to exercise any right
or power arising from any default shall impair any such right or power or be
construed to be a waiver of any such default or any acquiescence therein. No
waiver of any breach of any of the covenants of this Lease shall be construed,
taken or held to be a waiver of any other breach, or as a waiver, acquiescence
in or consent to any further or succeeding breach of the same covenant. The
acceptance by Landlord of any payment of rent or other sums due hereunder after
the termination by Landlord of this Lease or of Tenant's right to possession
hereunder shall not, in the absence of agreement in writing to the contrary by
Landlord, be deemed to restore this Lease or Tenant's rights hereunder, as the
case may be, but shall be construed as a payment on account, and not in
satisfaction of damages due from Tenant to Landlord.
XIX. MISCELLANEOUS
19.0 Right to Cure. Following any notice of default to Tenant and
opportunity for cure provided by Article XVIII, Landlord may, but shall not be
obligated to, cure any default by Tenant (specifically including, but not by way
of limitation, Tenant' failure to obtain insurance, make repairs, or satisfy
lien claims) ; and whenever Landlord so elects, all costs and expenses paid by
it in curing such default, including, without limitation, reasonable attorneys'
fees and costs, shall be so much Additional Rent due on the next rent date after
such payment, together with interest at the rate of ten percent (10%) per annum,
or such lesser rate equal to the maximum rate of interest permitted by law, from
the date of the advance to the date of repayment.
19.1 Amendments Must Be in Writing. None of the covenants, terms or
conditions of this Lease to be kept and performed by either party, shall in any
manner be altered, waived, modified, changed or abandoned except by a written
instrument, duly signed and delivered by the other part.
19.2 Notices. All notices to or demands upon Landlord or Tenant desired or
required to be given under any of the provisions hereof shall be in writing. Any
notices or demands from Landlord to Tenant shall be deemed to have been duly and
sufficiently give if delivered personally or mailed by United States certified
mail in an envelope properly stamped and addressed to Tenant at Tenant's Address
or at such other address as Tenant may heretofore have designated by written
notice to Landlord, and any notices or demands from Tenant to Landlord shall be
deemed to have been duly and sufficiently given if delivered personally or
mailed by United States certified mail in an envelope properly stamped and
addressed to Landlord at Landlord's Address, or at such other address or to such
other agent as Landlord may heretofore have designated by written notice to
Tenant, with a copy to any first mortgagee of the Leased Premises, the identity
and address of which Tenant shall have received written notice. The effective
date of any notice shall be the date of personal delivery or, in the case of
mailing, one (1) day after delivery of the same to the United States Postal
Service.
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19.3 Short Form Lease. Tenant shall neither record this Lease nor record a
memorandum hereof without the Landlord's prior written consent. If Landlord
requests, the parties shall execute and acknowledge a short form of Lease for
recording purposes at Landlord's expense.
19.4 Time of Essence. Time is of the essence of this Lease and all
provisions herein relating thereto shall be strictly construed.
19.5 Relationship of Parties. Nothing contained herein shall be deemed or
construed by the parties hereto, or by any third party, as creating the
relationship of principal and agent or of partnership, or of joint venture, by
the parties hereto, it being understood and agreed that no provision contained
in this Lease nor any acts of the parties hereto shall be deemed to create an
relationship other than the relationship of Landlord and Tenant.
19.6 Captions. The captions of this Lease are for convenience only and are
not to be construed as part of this Lease and shall not be construed as defining
or limiting in any way the scope or intent of the provisions hereof.
19.7 Severability. If any term or provision of this Lease shall to any
extent be held invalid or unenforceable, the remaining terms and provisions of
this Lease shall not be affected thereby, but each term and provision of this
Lease shall be valid and shall be enforced to the fullest extent permitted by
law.
19.8 Law Applicable. This Lease shall be construed an enforced in
accordance with the laws of the State in which the Leased Premises are located.
19.9 Covenants Binding on Successors. All of the covenants, agreements,
conditions and undertakings contained in this Lease shall extend and inure to
and be binding upon the permitted heirs, executors, administrators, successors
and assigns of the respective parties hereto.
19.10 Brokerage. Landlord and Tenant warrant to the other that neither of
them has had any dealings with any broker or agent in connection with the
transactions contemplated hereby. Landlord and Tenant covenant to pay, hold
harmless and indemnify the other from and against any and all costs, expenses or
liability for any compensation, commissions and charges claimed by any broker or
agent with respect to the transactions contemplated hereby or the negotiation
thereof and arising by virtue of the acts of the indemnifying party.
19.11 Landlord's Expenses. Tenant agrees to pay on demand Landlord's
expenses, including, without limitation, reasonable attorneys' fees an costs,
incurred either directly or indirectly in enforcing any obligation of Tenant
under this Lease or, in curing any default by Tenant hereunder.
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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of
the day and year first above written.
LANDLORD:
XXXXXXX XXXXXX CORPORATION
By:
----------------------------------
Its:__________________________________
TENANT
XXXXXXX XXXXXX ELECTRONICS CO.
By: /s/ [Illegible] SECY.
----------------------------------
Its:__________________________________
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[Letterhead of BTR]
July 28, 1995
Xxxxxx Industries, Inc.
00 Xxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000-0000
Gentlemen:
I am Assistant General Counsel of BTR Inc., a company under common control
with Xxxxxxx Xxxxxx Electronics Corporation, a Delaware Corporation ("Seller").
I have represented Seller in connection with the preparation, execution and
delivery of, and the consummation of the transactions contemplated by, the
Purchase and Sale Agreement dated July 28, 1995 (the "Agreement") by and between
Seller and Xxxxxxx Xxxxxx Electronics Co., a Pennsylvania corporation ("Buyer"),
pursuant to which Seller has agreed to sell, and Buyer has agreed to purchase,
certain assets and the business of Seller on the terms and conditions described
therein. Capitalized terms used herein but not otherwise defined herein shall
have the respective meanings assigned to such terms in the Agreement.
In connection with such representation, I have examined the Agreement and
have reviewed the corporate proceedings taken by Seller in connection with the
authorization, execution and delivery of the Agreement. I have also examined
originals, or copies certified to my satisfaction, of such corporate records of
Seller and other instruments, certificates of public officials and such other
documents as I have deemed necessary as a basis for the opinions hereinafter
expressed. In such examination, I have assumed the genuineness of all
signatures, the authenticity of all documents submitted to me as originals and
the conformity with the originals of all documents submitted to me as copies. As
to questions of fact material to this opinion, I have, when relevant facts were
not independently established, relied upon certificates of officers of Seller
and the representations and warranties of Seller contained in the Agreement.
On the basis of the foregoing, and having regard for such legal
considerations I deem relevant, I am of the opinion that:
(a) Seller is a corporation duly incorporated, validly existing and in
good standing under the laws of Delaware and has all requisite corporate power
to own, lease and operate its property and carry on its business as it is now
being conducted.
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July 28, 1995
Page 2
(b) Seller has all requisite corporate power and authority to execute and
deliver the Agreement to which it is a party and to consummate the transactions
contemplated thereby. The execution and delivery of the Agreement and the
consummation of the transactions contemplated thereby have been duly authorized
and approved by all necessary and proper corporate action of Seller. The
Agreement constitutes the legal, valid and binding obligation of Seller,
enforceable against each of them in accordance with its terms, except as such
enforceability may be limited by:
(i) bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the enforcement of creditors' rights
in general;
(ii) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law);
(iii) applicable limitation periods;
(iv) applicable laws limiting the enforcement of any non-competition
and non-solicitation covenants and rights of indemnity and/or
contribution;
(v) applicable bulk sales laws; and
(vi) applicable laws or provisions in the Contracts prohibiting
assignment of the Contracts.
(c) Neither the execution and delivery of the Agreement by Seller, nor the
consummation by Seller of the transactions contemplated thereby, will conflict
with, result in a breach of or constitute a default under the Certificate of
Incorporation or By-Laws.
I express no opinion herein as to any laws other than the laws of the
General Corporation Law of the State of Delaware and the Federal laws of the
United States.
Very truly yours,
/s/ Xxxxx X. Xxxx
Xxxxx X. Xxxx
Assistant General Counsel
63
[Letterhead of BTR]
July 28, 1995
Xxxxxx Industries, Inc.
00 Xxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000-0000
Gentlemen:
I am Assistant General Counsel of BTR Inc., a company under common control
with Xxxxxxx Xxxxxx Electronics Corporation, a Delaware Corporation ("Seller").
I have represented Seller in connection with the preparation, execution and
delivery of, and the consummation of the transactions contemplated by, the
Purchase and Sale Agreement dated July 28, 1995 (the "Agreement") by and between
Seller and Xxxxxxx Xxxxxx Electronics Co., a Pennsylvania corporation ("Buyer"),
pursuant to which Seller has agreed to sell, and Buyer has agreed to purchase,
certain assets and the business of Seller on the terms and conditions described
therein. Capitalized terms used herein but not otherwise defined herein shall
have the respective meanings assigned to such terms in the Agreement.
In connection with such representation, I have examined the Agreement and
have reviewed the corporate proceedings taken by Seller in connection with the
authorization, execution and delivery of the Agreement. I have also examined
originals, or copies certified to my satisfaction, of such corporate records of
Seller and other instruments, certificates of public officials and such other
documents as I have deemed necessary as a basis for the opinions hereinafter
expressed. In such examination, I have assumed the genuineness of all
signatures, the authenticity of all documents submitted to me as originals and
the conformity with the originals of all documents submitted to me as copies. As
to questions of fact material to this opinion, I have, when relevant facts were
not independently established, relied upon certificates of officers of Seller
and the representations and warranties of Seller contained in the Agreement.
On the basis of the foregoing, and having regard for such legal
considerations I deem relevant, I am of the opinion that:
(a) Seller is a corporation duly incorporated, validly existing and in
good standing under the laws of Delaware and has all requisite corporate power
to own, lease and operate its property and carry on its business as it is now
being conducted.
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July 28, 1995
Page 2
(b) Seller has all requisite corporate power and authority to execute and
deliver the Agreement to which it is a party and to consummate the transactions
contemplated thereby. The execution and delivery of the Agreement and the
consummation of the transactions contemplated thereby have been duly authorized
and approved by all necessary and proper corporate action of Seller. The
Agreement constitutes the legal, valid and binding obligation of Seller,
enforceable against each of them in accordance with its terms, except as such
enforceability may be limited by:
(i) bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the enforcement of creditors' rights
in general;
(ii) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law);
(iii) applicable limitation periods;
(iv) applicable laws limiting the enforcement of any non-competition
and non-solicitation covenants and rights of indemnity and/or
contribution;
(v) applicable bulk sales laws; and
(vi) applicable laws or provisions in the Contracts prohibiting
assignment of the Contracts.
(c) Neither the execution and delivery of the Agreement by Seller, nor the
consummation by Seller of the transactions contemplated thereby, will conflict
with, result in a breach of or constitute a default under the Certificate of
Incorporation or By-Laws.
I express no opinion herein as to any laws other than the laws of the
General Corporation Law of the State of Delaware and the Federal laws of the
United States.
Very truly yours,
/s/ Xxxxx X. Xxxx
Xxxxx X. Xxxx
Assistant General Counsel
PMK/tr
