Exhibit 10.14
ASSET PURCHASE AGREEMENT
This Agreement is made this 31 day of December, 2001, at Cleveland,
Ohio, among (i) American Architectural Products Corp., a Delaware corporation
("Parent"), whose principal offices are located at 000 Xxxxxxxx Xxxxxxxx Xxxx,
Xxxxx 000, Xxxxxxxx, Xxxx 00000; (ii) American Weather-Seal Co., a Delaware
corporation ("Seller"), whose principal offices are located at 000 Xxxxxxxx
Xxxxxxxx Xxxx, Xxxxx 000, Xxxxxxxx, Xxxx 00000; and (iii) Profile Group, LLC, an
Ohio limited liability company ("Buyer"), whose principal offices are located at
000 Xxxxx Xxxx, Xxxxx 000, Xxxxxxxxx, Xxxx 00000.
BACKGROUND
1. Parent is a Delaware corporation, and presently owns all of
the outstanding shares of stock of Seller.
2. Seller is a Delaware corporation, and is a wholly-owned
subsidiary of Parent. Among other business operations, Seller
presently owns and operates two aluminum extrusion, anodizing,
and fabricating businesses known internally as the "Aluminum
Extrusion Group," operated from two locations, known as the
Norton Location and the Boardman Location.
3. Parent and Seller, together with other Affiliates, currently
are debtors in a Chapter 11 bankruptcy proceeding in the U.S.
Bankruptcy Court, Northern District of Ohio (Youngstown) under
Bankruptcy Case No. 00-43726, assigned to Chief Judge Xxxxxxx
X. Xxxxx.
4. Parent and Seller desire for Seller to sell to Buyer and Buyer
desires to purchase substantially all of the personal property
of Seller that is used in Seller's Aluminum Businesses,
including the goodwill and going concern value of Seller's
Aluminum Businesses (collectively the "Purchased Assets"), on
the terms set forth below.
Accordingly, for other good and valuable consideration, the receipt and
sufficiency of which is acknowledged, the parties agree as follows:
TERMS OF AGREEMENT
SECTION 1 PURCHASE AND SALE OF ASSETS
Seller will sell, convey, transfer, and assign to Buyer, at the
Closing, by xxxx of sale, assignment, or other appropriate instruments, free of
all Liens of any Entity or person, pursuant to Section 363 of the Bankruptcy
Code and the Approval Order, and Buyer will purchase and take title to, at the
Closing and subject to the conditions set forth below, all of the personal
property owned by Seller (whether known or unknown, tangible or intangible, and
wherever
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located) and used in connection with, or that arise out of, the operation of
Seller's Aluminum Businesses, except the property listed in Section 2. The
property sold and purchased under this Agreement is sometimes collectively
referred to as the "Purchased Assets." The Purchased Assets include all of the
following personal property owned by Seller, and described as follows:
(a) all receivables of Seller that arise out of the operation of
Seller's Aluminum Businesses;
(b) all inventory of Seller acquired for Seller's Aluminum
Businesses (including raw materials, supplies,
work-in-process, semi-finished goods, and finished goods, and
rights to goods in transit, all replacement, spare, and
component parts);
(c) all rights arising from prepaid expenses, deferred charges,
and deposits, other than bank deposits resulting from Seller's
Aluminum Businesses, listed on Schedule 1(c);
(d) all other fixed assets, including all machinery, equipment,
including anodizing racks and extrusion presses, tooling,
dies, furniture, furnishings, business machines and computer
hardware, telephonic equipment, all spare, replacement or
maintenance parts, tooling, and supplies related to such items
that are used in connection with Seller's Aluminum Businesses,
and including those items described in Schedule 1(d), (but
excluding only those items specifically set forth in Section
2; provided, however, that the list of fixed assets set forth
in Schedule 1(d) is not intended by the parties to be an
exhaustive or exclusive listing of the fixed assets of Seller
sold under this Agreement, it being the intention of the
parties that Buyer acquire all of the fixed assets of Seller
used in connection with Seller's Aluminum Businesses,
irrespective of whether any fixed assets are disclosed in the
schedules, and regardless of whether the assets have been
written off the books and records of account of Seller, but
excepting only those fixed assets specifically described in,
and excluded by, Section 2 below;
(e) all rights of Seller to computer software (however recorded),
programs, data bases, including all systems data, source
programs, record layouts, program libraries, and any other
documentation in those application areas that pertain to any
data processing system or operation related to the
engineering, marketing, accounting, receiving, purchasing, and
maintenance functions used exclusively in Seller's Aluminum
Businesses; all of which are listed in Schedule 1(e);
(f) pursuant to Section 365 of the Bankruptcy Code and the
Approval Order, all right, title and interest in and to all of
Seller's Contracts (including purchase orders and leases) that
(i) result from or pertain to Seller's Aluminum Businesses,
(ii) are described in Schedule 1(f), (iii) qualify as
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Executory Contracts and are assumed by Seller pursuant to
Section 365 of the Bankruptcy Code, and (iv) are assigned to
Buyer, pursuant to an Assignment and Assumption Agreement, a
copy of that agreement being attached as Exhibit A;
(g) the customer list of the customers of Seller's Aluminum
Businesses, including those customers disclosed in Schedule
1(g);
(h) all drawings, designs and production data, manuals, charts,
instructions of application, files, records, signs, customer
and marketing data, engineering data, plans, and blueprints
that are used in connection with Seller's Aluminum Businesses
and assets, all documents, papers, and records pertaining to
employees, customers, and vendors in connection with Seller's
Aluminum Businesses, including receivable and payable records;
(i) all Intellectual Property owned by Seller and used in
connection with Seller's Aluminum Businesses, and all rights
that Seller has to any Proprietary Information related to
Seller's Aluminum Businesses;
(j) to the extent assignable or transferable, all Authorizations
that relate to, or that are used by Seller in connection with
Seller's Aluminum Businesses or the Purchased Assets;
(k) all supplies, including operating supplies, packaging and
shipping materials, stationery and other office supplies
pertaining to Seller's Aluminum Businesses;
(l) all of Seller's interest in all telephone, fax, and telex
numbers, Internet addresses, Domain names, and Websites, post
office box numbers that pertain to Seller's Aluminum
Businesses, and all listings pertaining to Seller's Aluminum
Businesses in all telephone books and directories, stationery,
forms, labels, shipping material, catalogs, brochures, art
work, photographs, and advertising and promotional materials;
the Internet addresses, domain names, websites, telephone,
fax, and telex numbers, and post office box numbers, all being
identified in Schedule 1(l);
(m) all vendor or UPC payment identification numbers used by
Seller in connection with Seller's Aluminum Businesses for
remittances from customers, and all rebates from suppliers or
similar payments earned by Seller and resulting from Seller's
Aluminum Businesses;
(n) all rights under third-party manufacturers' warranties that
pertain to Seller's Aluminum Businesses;
(o) all claims as to which Seller is a judgment creditor,
resulting from Seller's Aluminum Businesses;
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(p) all of Seller's choses in action or claims that pertain to, or
arise out of, the Purchased Assets or Seller's Aluminum
Businesses; and
(q) the goodwill and going concern value of Seller's Aluminum
Businesses.
The list of property set forth above is not intended by the parties to
be an exhaustive or exclusive listing of the property of Seller sold under this
Agreement. Rather, the parties intend that Buyer acquire all property, property
rights, and assets of Seller related to or that arise out of the operation of
Seller's Aluminum Businesses, including all Contract rights for Contracts that
are assigned to Buyer as described in Section 1(f), and legal rights of Seller,
wherever situated, irrespective of whether the property, assets or rights are
described or disclosed in this Agreement, and regardless of whether the property
or assets have been written off the books and records of account of Seller, but
excepting only that property of Seller that is specifically described within and
excluded by Section 2 below.
SECTION 2 ASSETS SPECIFICALLY EXCLUDED
This Agreement specifically excludes the sale and purchase of:
(a) cash, cash equivalents, cash in transit, bank deposits, and
marketable securities;
(b) receivables owed by any Affiliate of Seller, including Parent,
or owned by Seller and related to Seller's business operations
other than Seller's Aluminum Businesses;
(c) any interest in any real property;
(d) any rights to any property and liability insurance policies,
insurance policy premiums, proceeds from insurance coverage,
and any performance bonds, and any claims of Seller that arise
under any such policies or bonds;
(e) Contaminants that are used in Seller's Aluminum Businesses and
that are not stored in the original sealed container and are
not an integral part of the equipment that is part of the
Purchased Assets;
(f) the paint line equipment and certain punch press equipment,
all of which are located at the Norton Location; and the
anodizing dipping tanks that are used in the anodizing line,
and two dies that are owned by a customer of the Boardman
Business, all of which are located at the Xxxxxxxx Location;
and all of which are described in Schedule 2(f);
(g) all rights to Tax deposits and any of Seller's claims to Tax
refunds;
(h) all rights to any assets or property of any Employee Benefit
Plans;
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(i) Seller's corporate minute book, stock records, and Tax
Returns, and such other books and records, the originals of
which Seller is required to maintain under applicable Laws
(provided that copies of the books and records that are
retained by Seller, at Buyer's request, are included among the
Purchased Assets);
(j) any shares of Seller's capital stock;
(k) any property of Seller that is not used in connection with
Seller's Aluminum Businesses;
(l) all rights of Seller in pending litigation;
(m) all rights of Seller arising under this Agreement; and
(n) any property that is not used exclusively in Seller's Aluminum
Businesses and not located at either the Norton Location or
the Boardman Location.
SECTION 3 PURCHASE PRICE AND MANNER OF PAYMENT
3.1 Purchase Price. The purchase price for the Purchased Assets and the
consideration for the restrictive covenants is $1,250,000, plus the
Seller's Liabilities that are assumed by Buyer, or for which Buyer will
reimburse Seller, under Sections 4.2(a), (b), (c), (d), and (e) (the
"Assumed Payables").
3.2 Allocation of Purchase Price. The parties acknowledge that the purchase
and sale of the Purchased Assets is an "applicable asset acquisition"
within the meaning of Code Section 1060. Accordingly, Buyer and Seller
will (i) make an allocation of the Purchase Price among the Purchased
Assets as set forth on IRS Form 8594, Asset Acquisition Statement,
attached as Exhibit B, (ii) prepare and file their respective federal
income tax returns consistent with such allocations, and (iii) attach
that IRS form to such tax returns.
3.3 Payment of the Purchase Price. Buyer will pay to Seller, at the
Closing, the sum of $1,200,000 by federal wire transfer to a bank
account designated in writing by the Seller and delivered to Buyer
three days before the Closing Date. Buyer will assume the Assumed
Payables at the Closing by signing and delivering the Assignment and
Assumption Agreement. Subject to any setoff rights that arise from a
claim for indemnification that Buyer has resulting from the
indemnification provisions set forth in Section 8.1, and that is
asserted by Buyer in writing, Buyer will pay to Seller, six months
after the Closing Date, the balance of the purchase price by federal
wire transfer to a bank account designated in writing by the Seller and
delivered to Buyer three days before that date.
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SECTION 4 LIABILITIES
4.1 Liabilities Retained By Seller. Except as otherwise expressly provided
for in Section 4.2, Buyer does not assume, expressly or impliedly, and
accordingly Buyer need not discharge and is not liable for the payment
or performance of any Liabilities of Seller. Seller retains and will
discharge all of Seller's Liabilities that arise from, or that pertain
to, Seller's Aluminum Businesses except for those Liabilities assumed
by Buyer under Section 4.2.
4.2 Certain Specified Liabilities of Seller Assumed By Buyer.
Notwithstanding Section 4.1, Buyer assumes, will reimburse Seller for,
or will pay or perform when due the following (and only the following)
Liabilities of Seller as of the Closing Date:
(a) Buyer will assume Seller's trade accounts payables that are
incurred in the ordinary course of the Boardman Business since
December 18, 2000;
(b) Buyer will assume Seller's Liability for accrued severance
pay, vacation pay, and holiday pay that Seller owes to
Seller's employees who (i) are employed by Seller in the
Boardman Business on the Closing Date, (ii) are employed by
Buyer on or after the Closing Date, and (iii) were not used by
Seller in the anodizing operations of the Boardman Business;
(c) Buyer will reimburse Seller, within 10 days after receipt of
notice of court approval, for Seller's Liability for severance
pay, vacation pay, and holiday pay that is approved by the
Bankruptcy Court for Seller's employees who (i) were employed
by Seller in the Boardman Business on the Closing Date, and
(ii) are not employed by Buyer on or after the Closing Date;
(d) Buyer will reimburse Seller, within 10 days after receipt of
Seller's demand for payment, for Seller's Liability for
accrued payroll taxes for Seller's employees who were employed
by Seller in the Boardman Business on the Closing Date;
(e) Buyer will reimburse Seller, within 10 days after receipt of
Seller's demand for payment, for Seller's other accrued
Liabilities that are described in Schedule 4.2(e), when such
Liabilities are due and payable by Seller;
(f) Buyer will assume Seller's contractual obligation to deliver
products or render services after the Closing, according to
purchase orders received by Seller in the ordinary course of
business before the Closing, together with Seller's
contractual obligations with respect to (i) the Contracts
selected by Buyer pertaining to Seller's Aluminum Businesses,
all being identified in a written list to be delivered to
Buyer by Seller before or at the Closing
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or (ii) the Contracts discovered by Buyer after Closing and ,
in each case, assumed by Buyer in writing, pursuant to the
Assignment and Assumption Agreement (Exhibit A), but only to
the extent that, in all events, the duties accrue and relate
solely to the period after the Closing.
Buyer has no right of setoff against any duty under this Section 4.2 to
reimburse Seller for any of Seller's Liabilities.
SECTION 5 REPRESENTATIONS AND WARRANTIES OF SELLER AND PARENT
Seller and Parent, jointly and severally, represent and warrant to
Buyer as follows.
5.1 Status of Seller and Parent. Parent and Seller are
corporations, each duly organized, duly incorporated, validly
existing, and in good standing in the state of formation, and
validly existing and in good standing under the Laws of the
State of Ohio.
5.2 Binding Nature and Enforceability of Agreement. This
Agreement, and all other documents delivered to Buyer at the
Closing, are legally binding upon, and enforceable against,
both Parent and Seller, subject to the condition precedent set
forth in Section 11.2.
5.3 Good Title. Seller has good and marketable title to the
Purchased Assets. Seller will transfer title to the Purchased
Assets to Buyer free and clear of all Liens of any person or
Entity. Seller, or its agent, has conducted a lien search , in
furtherance of obtaining its DIP facility, in order to
ascertain the lienholders with respect to the Purchased
Assets. To the best of Seller's knowledge, CIT Business Group
Inc. is the only secured creditor with a Lien upon the
Purchased Assets.
5.4 Contracts. Except as specifically disclosed in any other
Schedule, Schedule 5.4 lists every material Contract that
pertains to Seller's Aluminum Businesses by which Seller is
bound or from which Seller benefits, whether oral or written,
including all collective bargaining agreements. Except as
disclosed in Schedule 5.4, to the best of Seller's knowledge:
(i) all of Seller's Contracts related to Seller's Aluminum
Businesses are assignable to Buyer without any requirement to
obtain the consent of any person or Entity except approval of
the Bankruptcy Court in accordance with the Approval Order, or
any licensors of intellectual property as required and
applicable under Bankruptcy Code Section 365(C); (ii) since
the 1st day of January, 2001, there has not been any
modification or termination of any Assumed Contract under
circumstances that has a material adverse effect on Seller;
(iii) all of the Assumed Contracts are in full force and
effect and are valid and binding obligations of the parties to
such Contracts, enforceable according to their terms, in all
material respects; (iv) Seller has complied with all, and is
not in material default of any of the material provisions of
any Assumed Contracts by which Seller is bound; (v) there is
not any basis for
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a material claim of default, on Seller's part, of any Assumed
Contract; (vi) no event has occurred that, but for the passage
of time or the giving of notice or both, would constitute a
material default by Seller of an Assumed Contract; (vii)
Seller does not have any knowledge that any party to an
Assumed Contract is in material default; and (viii) there have
not been any discussions or correspondence with Seller
concerning any material default by Seller or any other party
to the Assumed Contracts, or concerning the termination of any
of the Assumed Contracts.
5.5 Financial Matters. Seller has delivered to Buyer complete and
accurate copies of the Acquisition Financial Statements. In
addition, Seller has delivered to Buyer complete and accurate
copies of Other Financial Statements. The Acquisition
Financial Statements and the Other Financial Statements
delivered to Buyer have been prepared (i) in conformity with
GAAP throughout the periods covered, and are consistent with
prior periods, except as otherwise expressly noted in those
statements, or otherwise disclosed in Schedule 5.5, and (ii)
from the Seller's accounting books and records, consistent
with past practice. For the avoidance of doubt, for the
purposes of this Section 5.5, the past practices of Seller
takes precedence over GAAP standards. The Acquisition Balance
Sheet and the balance sheets included within the Other
Financial Statements fairly present the financial condition of
Seller at the indicated dates. The Acquisition Statement of
Income and the income statements included within the Other
Financial Statements fairly present the results of Seller's
Aluminum Businesses for the periods covered.
5.6 Leased Assets; Other Assets. Schedule 5.6 lists all property
that is rented or leased by Seller, and used by Seller in
connection with Seller's Aluminum Businesses. Seller does not
use any property in the conduct of Seller's Aluminum
Businesses or without which Seller's Aluminum Businesses could
not be conducted, as presently conducted, that is not (i)
included in the Purchased Assets, (ii) included within the
excluded assets listed in Section 2, or (iii) disclosed as a
rented or leased asset in Schedule 5.6. Except as disclosed in
Schedule 5.6, the Purchased Assets include all of the assets
that are necessary to operate Seller's Aluminum Businesses as
a stand-alone business.
5.7 Tangible Personal Property. Except for items of inventory,
Schedule 1(d) sets forth the tangible personal property
included within the Purchased Assets where: (i) the value of
an individual item; or (ii) where the value of similar items,
in the aggregate, exceeds $1,000. All tangible personal
property included within the Purchased Assets is located at
either the Norton Location or the Boardman Location.
5.8 Intellectual Property. Except for the software licenses
disclosed in Schedule 5.8, Seller does not own or license any
Intellectual Property that is used in connection with the
operation of Seller's Aluminum Businesses. To the best of
Seller's knowledge, the manufacture, use, performance or sale
of products or services of Seller's Aluminum Businesses does
not violate or infringe upon any intellectual property or
other right of any person or Entity.
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5.9 Environmental Matters.
(a) To the best of Seller's knowledge, Seller's Aluminum
Businesses have been conducted, and currently are
conducted, in a manner, to generate, manufacture,
refine, transport, treat, store, handle, dispose,
transfer, produce or process all Contaminants, that
complies with all applicable Environmental Laws,
except as disclosed in Schedule 5.9(a). To the best
of Seller's knowledge, Seller has not been engaged,
at any time, and currently is not engaging, in any
activity (nor is failing to act) in a manner that has
resulted or may result in a Release, or threat of a
Release, into the Environment of a Contaminant in any
quantity regulated by Law in connection with the
operation of Seller's Aluminum Businesses, except as
disclosed in Schedule 5.9(a).
(b) Except as disclosed in Schedule 5.9(b),
(i) to the best of Seller's knowledge, no
Contaminant has been disposed of, generated
on, treated on, buried beneath, or
percolated beneath, and no disposal,
generation, treatment, burial or percolation
has been threatened in or near the Xxxxxxxx
Location;
(ii) to the best of Seller's knowledge, the
Xxxxxxxx Location does not contain any
underground storage tank;
(iii) Seller has not received any Notice
pertaining to any asserted violation of any
Environmental Law regarding the Xxxxxxxx
Location; and
(iv) To the best of Seller's knowledge, Seller
has complied, at all times, and currently is
complying, with all reporting, disclosure,
and record-keeping requirements of all
Environmental Laws. Seller possesses all
permits, licenses and approvals that are
required by Environmental Law for the
operation of Seller's Aluminum Businesses or
the use of the Purchased Assets, and Seller
has made timely and complete applications
for the issuance, renewal and reissuance of
such permits, licenses and approvals. To the
best of Seller's knowledge, no conditions
exist that will materially adversely affect
the continued validity of such permits,
licenses and approvals. Seller has not
engaged in any remediation of the Boardman
Location, for the purpose of complying with
any Environmental Law.
5.10 Continuing Operations. Seller and Parent intend to continue other
business operations after the Closing Date. With respect to the
continuing operations, Seller and Parent will continue to provide their
employees with health and medical benefits consistent with the current
health and medical benefits plan.
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Seller and Parent do not have a present intention to terminate their
current health and medical benefits plan.
5.11 Leased Real Property. A description of the Leased Real Property, which
is part of the Boardman Location, is set forth on Schedule 5.11. The
Leased Real Property has adequate water supply, storm and sanitary
sewage facilities, telephone, gas, electricity, fire protection, and
other public utilities, to conduct operations at the Xxxxxxxx Location
as currently conducted.
5.12 Consents. Except for the approval of the Bankruptcy Court, and subject
further to Section 5.4, no authorization, approval, consent or order
of, or registration, declaration or filing with, any court, Government,
Entity or person is required in connection with the signing, delivery
or performance of this Agreement, any exhibit, or any other agreement,
instrument or document to be delivered by, or on behalf of, Seller in
connection with the Transaction.
SECTION 6 REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller as follows:
6.1 Status of Buyer. Buyer is an Ohio limited liability company
that is duly organized, validly existing, and in good standing
under the laws of the State of Ohio, and has full powers and
authority to sign and perform this Agreement.
6.2 Authorization of Sale. The officers of Buyer who sign this
Agreement have the requisite capacity, power, and authority to
do so. The signing and delivery of this Agreement, and all
related documents, by Buyer through its officers, and the
performance of the Transaction does not (i) violate any
Contract to which Buyer is a party; or (ii) violate any
provisions of Buyer's Articles of Organization, Operating
Agreement, or any of Buyer's other governing documents.
6.3 Binding Nature and Enforceability of Agreement. This
Agreement, and all other documents delivered to Seller at the
Closing and that are signed by Buyer, are binding upon Buyer,
in all respects.
6.4 Buyer Awareness. To the best of Buyer's knowledge, Buyer is
not aware of any fact, circumstance or condition that would
reasonably cause Buyer to conclude that Seller or Parent has
breached any representation or warranty contained in this
Agreement or any other transaction document related to the
Transaction.
SECTION 7 SURVIVAL OF REPRESENTATIONS AND WARRANTIES
A person has "knowledge" of a fact within the meaning of this
Agreement, and the representations and warranties made in this Agreement, not
only when he has actual knowledge, but also when (i) he has knowledge of any
facts that, under the circumstances, constitutes bad faith in making any
representation or warranty, or (ii) he would have acquired knowledge after a
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reasonable inquiry or investigation in order to determine whether a
representation or warranty is accurate. The word "knowledge" as used in Section
5.9 includes the knowledge of Xx. Xxxxxxx Xxxxxx. The representations and
warranties of Seller and Parent set forth in Sections 5.1, 5.2, 5.3, 5.7 and
5.12 and the representations and warranties of Buyer will survive the Closing of
the Transaction until 180 days following the Closing Date, and all other
representations and warranties of Seller and Parent will expire upon the
conclusion of the Closing.
SECTION 8 INDEMNIFICATION
8.1 Indemnification of Buyer Indemnified Parties. Seller
Indemnitor Parties will indemnify the Buyer Indemnified
Parties, jointly and severally, for any Damages suffered by,
or resulting to, the Buyer Indemnified Parties arising from,
and will defend Buyer from, any of the following:
(a) any inaccurate representation made by Seller or
Parent, and any breach of warranty given by Seller or
Parent and set forth in Sections 5.1, 5.2, 5.3, 5.7
and 5.12, to the extent that they survive the Closing
Date; and
(b) any default in the performance by Seller or Parent of
its obligation to pay, perform, or discharge any of
the Liabilities retained by Seller under Section 4.1.
8.2 Buyer's Indemnification. Buyer indemnifies Seller for any
Damages, suffered by or resulting to Seller arising from, and
will defend Seller from, any inaccurate representation made by
Buyer, and any breach of warranty given by Buyer to the extent
that they survive the Closing Date.
8.3 Limitation on Duty to Indemnify. Seller's duty to indemnify
Buyer by reason of a breach of the warranty contained in
Section 5.3 is limited to the amount of the purchase price for
the Purchased Assets, and Seller's duty to indemnify Buyer for
any other claim arising under Section 8.1 is limited to
$50,000. Buyer's duty to indemnify Seller for any other claim
arising under Section 8.2 is limited to $50,000.
8.4 Interest Rate. Interest will accrue at the Default Interest
Rate for the benefit of either party, until paid in full, upon
any payment made by a party that constitutes Damages suffered
by, or resulting to, a party for which the party is entitled
to indemnification, commencing upon the date that the payment
is made by the party.
SECTION 9 RETENTION OF AND ACCESS TO RECORDS
Seller and Parent grant to Buyer (its agents, employees, attorneys, and
accountants) during normal business hours, after the Effective Date, complete
access to Seller's Aluminum Businesses premises, and any of Seller's documents
and records, including accounting source documents, vendor invoices, and
documents necessary to verify the cost of goods sold and gross
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profit, in order that Buyer may become fully acquainted with the Purchased
Assets (including the premises upon which Seller's Aluminum Businesses is
operated), Seller's Aluminum Businesses, and all matters and things pertaining
to the operation of Seller's Aluminum Businesses, and in order that Buyer may
ascertain the accuracy of Seller's representations and warranties.
For a period of six months after Closing, Seller and Parent will
maintain all records and documents pertaining to Seller's Aluminum Businesses
that Seller is permitted to retain under this Agreement, in a safe and secure
place. Seller will permit Buyer to review those records and documents, and make
copies (at Buyer's expense), provided that Buyer has a good business purpose,
including the defense of a third party claim or the preparation for a tax audit.
Seller may not destroy any such records or documents, at any time, without first
providing Buyer with a 30 day notice, specifying the records or documents to be
destroyed, and permitting Buyer the option to take possession of the records or
documents, in lieu of their destruction.
For a period of six months after the Closing Date, Buyer will maintain
all business and accounting records and documents pertaining to Seller's
Aluminum Businesses that are delivered to Buyer at the Closing in a safe and
secure place, including all accounting source documents, tax records, and books
of account. Buyer will permit Seller to review those records and documents, and
make copies (at Seller's expense), provided that Seller has a good business
purpose, including the defense of a third party claim or the preparation for a
tax return or a tax audit.
SECTION 10 RESTRICTIVE COVENANTS OF PARENT AND SELLER
10.1 Noncompetition. During a period of two consecutive years
commencing on the Effective Date (the "Noncompetition Term"),
Seller or Parent, alone, together, or in association with
others, may not, within the Restricted Area (as defined below
in Section 10.6), directly or indirectly, and except as
expressly permitted in Section 10.3,
(a) establish, own, engage in, or operate any business
that is engaged, in whole or in part, in any
Prohibited Activity (defined below), or
(b) become associated with, or advise or assist, any
person or Entity that is conducting business in the
Restricted Area if that person or Entity is engaged,
in whole or in part, in any Prohibited Activity.
10.2 Nondisclosure and Nonuse of Proprietary Information.
(a) As a material inducement for Buyer to enter into this
Agreement, Seller and Parent, at all times, will keep
secret and confidential, and may not disclose,
furnish, divulge, directly or indirectly any
Proprietary Information unless and until such
information enters the public domain. Seller and
Parent may not use or make use of the Proprietary
Information for any purpose, at any time after the
Closing Date.
12
(b) If Seller or Parent is requested or required (by
deposition, interrogatories, requests for information
or other such documents, subpoena, civil
investigation or similar process) to disclose any
Proprietary Information, then Seller or Parent, as
the case may be, will provide Buyer with immediate
notice of the request so that Buyer may seek an
appropriate protective order or waive compliance with
the provisions of this Agreement. If Buyer is unable
to obtain a protective order, then Seller or Parent
may disclose to the tribunal or governmental agency,
without liability to Buyer under this Agreement, that
portion of the Proprietary Information as is
required.
10.3 Exception as to Parent's Miami Florida Aluminum Operations.
Notwithstanding the general prohibition contained in this
Section 10, Parent, through its Affiliate, may continue to
operate its current Miami, Florida aluminum operations, as
such operations are currently conducted.
10.4 Remedies. If Seller or Parent breaches any of their
obligations under this Section, then Buyer may (i) institute
and prosecute proceedings in any court of competent
jurisdiction, either in law or in equity, to obtain Damages
for the breach of any of the terms of this Section; (ii) seek
a court order to enjoin Seller and Parent from performing any
acts prohibited by this Section, without the necessity of
showing any Damages, it being understood and agreed to by
Seller and Parent that their performance of any acts
prohibited by this Section will cause and result in Damage,
and irreparable harm, to Buyer; and (iii) take any other
action and seek any other remedies available in law or in
equity to Buyer in addition to the actions and remedies set
forth in this Agreement. The taking of any action, or the
seeking of any remedy, by Buyer pursuant to this Section is
not exclusive of, nor does it constitute the waiver of, any
other action or remedy available in law or in equity to Buyer.
10.5 Reformation of Agreement. The parties believe that the terms
set forth in this Section are reasonable. However, if any of
the covenants contained in this Section are found by a court
of competent jurisdiction to be invalid or unenforceable for
any reason, then the parties will request the court, and the
court may exercise its discretion, to reform the covenant to
the end that Seller and Parent are subject to those
noncompetition, nondisclosure, or noninterference covenants
that are reasonable under the circumstances and are
enforceable by Buyer.
10.6 Definitions. As used in this Section, the phrase "directly or
indirectly" means either personally or through any person or
Entity with which Seller or Parent is associated or connected
that engages in any Prohibited Activity. The term "Restricted
Area" means the United States of America. The term "Prohibited
Activity" means any activity that is related to or associated
with obtaining or attempting to obtain business from the
customers of the Seller's Aluminum Businesses (whether past or
current customers as of the Closing Date).
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10.7 Independence of Covenants. The obligations contained in this
Section on the part of Seller and Parent are independent of
any other obligation or term of this Agreement, or any
exhibit.
SECTION 11 BUYER'S CONDITIONS PRECEDENT TO CLOSING
Buyer's duty to complete the Transaction, and to perform under this
Agreement at Closing, in any respect, is subject to and conditioned upon the
satisfaction, at or before the Closing Date, of each of the following conditions
precedent:
11.1 Compliance with Agreement. All of the terms and conditions of
this Agreement to be complied with and performed by the
Seller, on or before the Closing Date, including the delivery
to Buyer of all schedules, documents, and instruments required
to be delivered to Buyer, are complied with and performed, in
all material respects.
11.2 Proceedings, Instruments, and Investigation Satisfactory. All
proceedings, corporate or otherwise, to be taken by Seller in
connection with the Transaction and all related documents,
including obtaining the Approval Order, are reasonably
satisfactory in form and substance to Buyer and Buyer's legal
counsel. The Closing may not occur unless and until there is
an executed and docketed order of the Bankruptcy Court, in
form and substance reasonably satisfactory to the Buyer,
approving and authorizing Seller to enter into this Agreement
and to consummate the Transaction, and further ordering that:
(a) the Purchased Assets are free and clear of all Liens
whatsoever pursuant to Sections 363 and 365 of the
Bankruptcy Code, as applicable;
(b) all conditions precedent to the assumption and
assignment of the Assumed Contracts, under Section
365 of the Bankruptcy Code, have been satisfied;
(c) Buyer has acted in good faith within the context of
and is entitled to the protection of Section 363(m)
of the Bankruptcy Code;
(d) the sale contemplated by this Agreement is not
subject to avoidance under Section 363(n) of the
Bankruptcy Code;
(e) Buyer is not assuming any of the Seller's Liabilities
or Liens except for the Assumed Liabilities;
(f) the obligations of the Seller under this Agreement
are not affected by the confirmation of any plan of
reorganization, any discharge received by the Seller,
the conversion of the Seller's bankruptcy to a case
under Chapter 7 of the Bankruptcy Code, or the
dismissal of the bankruptcy case; and
14
(g) all persons are enjoined from pursuing, in any way,
the Buyer or the Purchased Assets, except for or on
account of Assumed Liabilities, by suit or otherwise
to recover on any Liens or claims that they had or
may have against the Seller or the Purchased Assets
(such order referred to as the "Approval Order").
11.3 Representations and Warranties. All of Seller's
representations and warranties set forth in this Agreement are
true and correct, in all material respects, as of both the
Effective Date and the Closing Date, subject to any changes
contemplated by this Agreement, and any deviation or falsity
has been disclosed to, and agreed to by, Buyer in writing
after the Effective Date and before the Closing Date.
11.4 No Pending Government Proceeding or Private Litigation. As of
the Closing Date, there is no pending Government Proceeding or
Private Litigation that, if adversely determined, would impair
the right or ability of Buyer to carry on and conduct Seller's
Aluminum Businesses, after the Closing, in the manner
previously conducted, or that would materially adversely
affect the use by Buyer of the Purchased Assets.
11.5 Compliance with Statutory Requirements. All legal requirements
for the valid consummation by the parties of the Transaction
are fulfilled, including obtaining the Approval Order, and all
Authorizations required to be obtained, if any, in order to
permit the consummation of the Transaction.
11.6 Loss to Purchased Assets. There has not been any occurrence of
a significant loss, destruction or damage due to fire, storm,
theft or other casualty of or to the Purchased Assets. Any
loss, destruction, or damage is deemed significant if the cost
of the replacement or repairs, in the aggregate, exceeds the
sum of $50,000.
11.7 No Material Adverse Events. Since the Effective Date, whether
in the ordinary course of business, there has not been,
occurred or arisen any event, condition or state of facts of
any character (except for changes in general economic
conditions) that materially adversely affects the conduct of
Seller's Aluminum Businesses. Notwithstanding the foregoing,
Buyer acknowledges the recent deterioration of Seller's
Aluminum Businesses as well as the effects of the bankruptcy
case upon Seller's Aluminum Businesses and Buyer agrees that
such events, or the continuation thereof, do not constitute a
triggering condition precedent to Close; provided that Buyer
complies with its obligations under Section 12.1.
11.8 Schedules. No change in any schedule that is updated and
delivered to Buyer by Seller in accordance with Section 12.2
shows a material adverse change to the financial condition,
the Purchased Assets or Seller's Aluminum Businesses that were
previously shown in the schedules. Notwithstanding the
foregoing, Buyer acknowledges the recent deterioration of
Seller's Aluminum Businesses as well as the effects of the
bankruptcy case upon Seller's Aluminum Businesses and Buyer
agrees that such events, or the continuation thereof, do not
constitute a triggering
15
condition precedent to Close; provided that Buyer complies
with its obligations under Section 12.1.
11.9 Effect of Failure of Any Condition Precedent. If any of the
conditions precedent specified above fail to be satisfied on
or before the Closing, then Buyer may terminate this Agreement
before the Closing Date by giving written notice to Seller
evidencing that intent, and thus render the duties and
obligations of Buyer null and void. If the condition precedent
set forth in Section 11.6 is not satisfied, then Seller may
terminate this Agreement by giving written notice to Buyer
before the Closing Date evidencing that intent, and thus
render the duties and obligations of Seller null and void.
SECTION 12 ADDITIONAL COVENANTS OF THE PARTIES
12.1 Operation of Seller's Aluminum Businesses During the Interim
Period. Commencing on the Effective Date of this Agreement and
ending on the Closing Date (the "Interim Period"), and except
as otherwise specifically consented to or agreed to, in
writing, by Buyer, Seller will use its commercially reasonable
efforts to continue to operate Seller's Aluminum Businesses,
in the ordinary course and in substantially the same manner as
it has been operated by the Seller in the past recognizing the
effects of the deterioration of the Aluminum Businesses and
the bankruptcy case. Specifically, Seller agrees to use its
commercially reasonable efforts to:
(a) retain all present employees of Seller's Xxxxxxxx
Businesses;
(b) maintain pleasant and harmonious relationships with
all suppliers, customers, and others having contact
or dealings with Seller's Aluminum Businesses;
(c) maintain in full force and effect, at its own cost
and expense, the insurance policies currently in
force, insuring the Purchased Assets against loss or
destruction by fire, storm, theft or other insurable
casualty;
(d) exercise due diligence in safeguarding and
maintaining the confidentiality and existence of all
books, reports, records, and data pertaining to
Seller's Aluminum Businesses;
(e) continue to comply, in all material respects, with
all Laws applicable to Seller's Aluminum Businesses
and comply, in all material respects, with all
Contracts presently in force;
(f) not increase any salary, compensation or other
employment related benefits to any officers,
employees or agents of Seller and primarily used in
Seller's Aluminum Businesses;
16
(g) not enter into any Contracts or transactions, except
in the ordinary course of business, on account of
Seller's Aluminum Businesses;
(h) not waive any rights or claims in Seller's favor that
arise out of or because of Seller's Aluminum
Businesses;
(i) not accept advance payments from customers or
preinvoice for products or services sold or rendered
by Seller, except as may be consistent with past
practice;
(j) not sell, transfer, dissipate or otherwise make any
disposition of any of the Purchased Assets, except a
disposition of current assets in the ordinary course
of business; and
(k) not create, incur, or assume any indebtedness for
borrowed money, not mortgage, pledge, or otherwise
encumber any of its properties or assets, or not
create or assume any other indebtedness except trade
accounts payable and other liabilities incurred in
the ordinary course of business.
12.2 Updating of Schedules. Seller will notify Buyer of any
changes, additions or events that change, or cause any change
in or addition to, the schedules promptly after their
occurrence and again at the Closing by the delivery of
appropriate updates to the schedules. Any change to, or
modification of, the schedules shall afford Buyer the sole
remedy to terminate this Agreement, provided however, that
this Section 12.2 shall not entitle Buyer to refuse to Close
the Transaction unless the change, modification or inaccuracy
of the schedules results in a material adverse effect upon
Seller's Aluminum Businesses.
12.3 Publicity and Disclosure. Seller will submit to Buyer in
writing, for its comment and reasonable approval, any news
release or announcement by Seller pertaining to this
Agreement, or the Transaction. Except as required by Law or as
determined by Seller's securities counsel, Seller may not make
any general announcement, nor any statement or disclosure to
any person or Entity, including Seller's customers or
suppliers concerning the Transaction without the prior written
consent of Buyer.
12.4 Filing of Tax Returns. After Closing, with respect to Seller's
Aluminum Businesses, Buyer and Seller will file all Tax
returns when due, or within the time frames extended by such
governing authority, and pay when due, in accordance with
applicable law, the applicable tax, if any. Seller will
deliver to Buyer within 10 days after the filing adequate
proof or evidence of the filing of all Tax returns, and the
payment of the Taxes reported.
12.5 Satisfaction of Conditions. Seller and Parent will use best
efforts to cause each of the conditions set forth in Section
11 to be satisfied at or before the Closing.
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Upon signing this Agreement, Seller and Parent will promptly
take all action that is necessary to obtain the Approval Order
as soon as reasonably possible.
12.6 Access. After the Effective Date and until the Closing Date,
Seller will provide Buyer, and its representatives, reasonable
access to the Xxxxxxxx Location and Norton Location, and all
business and accounting documents and records, including
accounting source documents and vendor invoices. In addition,
Seller will permit Buyer, or its agents, to perform
engineering, environmental, and workplace condition surveys
and any other physical inspections that Buyer deems necessary.
Any such surveys and inspections shall be at Buyer's sole
expense and conducted in such a manner as to not disrupt
either the Xxxxxxxx Business or the Norton Business. If the
Transaction is not consummated for any reason, then Buyer
will: (i) return to Seller all materials obtained from Seller;
(ii) not use for its own benefit any information not available
to Buyer from a source other than Seller; and (iii) not
disclose any information contained in the materials, except
information that is available to Buyer from a source other
than Seller, or required to be disclosed by Law.
12.7 Notification as to Occurrence of Material Adverse Events. When
known by Seller, Seller will promptly advise Buyer, in
writing, of any material adverse change in Seller's Aluminum
Businesses or the Purchased Assets.
12.8 Signing the Exhibits. At the Closing, the parties will sign
and deliver the agreements that are Attachments, including
Exhibit C, which is a lease agreement for part of the real
property at the Xxxxxxxx Location.
12.9 Transition Services for Accounts Receivable. After the Closing
Date, Seller will cooperate with Buyer and will take all
reasonable action to assure Buyer that all payments received
by Seller, whether payments made to Seller's lockbox, or
checks received by Seller, on account of the receivables that
are part of the Purchased Asset are promptly forwarded to or
paid to Buyer or to Buyer's lender at the direction of Buyer.
12.10 COBRA Compliance.
(a) Seller will timely provide, or cause the plan
administrator to timely provide, any notices and any
continuation of health benefit coverage required to
be provided to any of Seller's employees, former
employees, or the beneficiaries or dependents of the
employees or former employees, under Part 6 of
Subtitle B of Title I of ERISA or Code Section
4980B(f) ("COBRA"), to the extent that the notices
and the continuation of health benefit coverage are
required to be provided by Seller by reason of events
occurring before or on the Closing Date or by reason
of the Transaction. For the purposes of the
foregoing, Seller will treat all of its employees
(and the employees' beneficiaries and dependents) as
of the Closing Date as having incurred a "qualifying
event" (within the meaning of ERISA Section
18
603 and Code Section 4980B(f)(3)), on the Closing
Date. Seller will deliver to Buyer upon written
request all information requested in order for Buyer
to determine whether there have been any failures to
comply with continuation health care requirements of
Code Sections 162(k) and 4980B and ERISA
Sections 601 through 609 as such requirements
have applied to any group health plan maintained by
or for Seller or any spouse, former employee of
Seller, or any spouse, former spouse, dependent child
or former dependent child of any such employee, on or
prior to the Closing.
(b) Seller will continue the health benefit coverage
required by COBRA and the provisions of this
Agreement irrespective of the termination or
elimination of any health benefit plan of Seller.
Seller will provide Buyer, as soon as practical, with
evidence of compliance with this Section.
(c) Seller will use its best efforts expeditiously to
provide to the person designated by Buyer all
information that such person deems necessary to
determine whether there have been any failures to
comply with the continuation health care requirements
of Code Section 162(k)/4980B and ERISA Sections
601 through 609 as such requirements have applied to
any group health plan maintained by or for Seller ,
for the benefit of any employee, a spouse of any
employee, a former employee, or any spouse, former
spouse, dependent child or former dependent child of
any such employee, on or before the Closing Date.
Furthermore, Seller will use its best efforts
expeditiously to provide to the person designated by
Buyer with all information that such person deems
necessary to correct any failures to comply with such
continuation health care coverage requirements.
Seller will include within that information the
identification of all covered employees (as defined
in Code Section 162(k)(7)(A)/4980B(f)(7) and their
qualified beneficiaries (as defined in Code
Section 162(k)(7)(b)/4980b(g)(1), the identification
of all qualifying events with respect to such covered
employees or qualified beneficiaries (as defined in
Code Section 162(b)(3)/4980B(f)(3)), and information
otherwise demonstrating compliance with all of the
continuation health care coverage requirements of
Code Section 162(k)/4980B and ERISA Sections 601
through 608.
12.11 Employment Matters. Upon Closing, Seller will terminate the
employment of its employees who work at the Boardman Location
as of the Closing Date. Except for employees who are employed
by Seller in the anodizing operations at the Xxxxxxxx
Location, Buyer shall offer employment to those employees of
Seller, on terms and conditions that Buyer determines, but
including medical benefits provided by Anthem Blue Cross/Blue
Shield under a welfare benefit plan established by an
Affiliate of Buyer. Seller will cooperate with Buyer by
permitting Buyer throughout the period before the Closing to
meet with Seller's employees who work at the Xxxxxxxx Location
at any reasonable times that are approved by a representative
of Seller, and to distribute to those employees of
19
Seller forms and other documents relating to employment by
Buyer after the Closing that Buyer reasonably requests.
12.12 Accounting Conversion Cooperation. After the Effective Date,
Seller will cooperate with Buyer to assist Buyer in the
computer and accounting conversion of Seller's Aluminum
Businesses and accounting information, in order that there
will be a timely and orderly transition of Seller's Aluminum
Businesses to Buyer. The accounting information includes
information pertaining to customer billing and vendor
payables, so that, as of Closing, Buyer will have the
accounting information of Seller's Aluminum Businesses
necessary to fully integrate Seller's Aluminum Businesses with
Buyer's computer system. After the Effective Date, Seller will
deliver to Buyer, in computer tape or diskette form, the
accounting information pertaining to Seller's Aluminum
Businesses.
12.13 Cooperation in Litigation. If, after the Closing, Buyer
requires the cooperation of Seller, its officers, directors,
shareholders or employees to aid in the assertion, defense or
settlement of any Private Litigation or Government Proceeding,
and if no conflict of interest exists between Buyer and Seller
or such persons, then the Seller will use best efforts to make
such persons available to Buyer to participate in such
proceeding; provided that Buyer will pay all out-of-pocket
expenses that are incurred and preapproved by Buyer.
12.14 Further Assurances. After Closing, each party, at its expense,
will sign and deliver, or cause to be signed and delivered,
all such other instruments, including instruments of
conveyance, assignment or transfer, and to make all filings
with and to obtain all Authorizations or consents from any
other person or Entity, and take all such other actions as
such Party reasonably requests, consistent with the terms of
this Agreement, to effectuate the provisions and intent of
this Agreement and the Transaction.
12.15 Right of Access. For a period of 30 days after the Closing
Date, Seller will (i) maintain in place the Purchased Assets
located upon the Norton Location as of the Closing Date, and
(ii) permit Buyer access to the Norton Location to take
possession of and to remove the Purchased Assets.
12.16 Bankruptcy Proceedings and Competitive Bids. Seller may not
submit to the Bankruptcy Court any pleading, motion, proposed
order, bidding procedures, and other document in connection
with seeking to obtain the Approval Order for this transaction
without first submitting the document to Buyer's legal
counsel. Seller will promptly notify Buyer of any hearings of
the Bankruptcy Court that pertain to this Agreement, and of
any actions to be taken by Seller to advertise the sale.
Seller will only solicit and consider competitive bids that
are at least $100,000 greater than the Purchase Price.
12.17 Break-Up Fee. Subject to the approval of the Bankruptcy Court,
if Seller (i) accepts a competitive bid and closes a
transaction with such competitive bidder,
20
or (ii) elects not to Close the Transaction with Buyer, then
Seller will promptly pay to Buyer, upon receipt of written
demand, a fee of $50,000 ("Break-up Fee") to compensate Buyer
for its time, trouble and lost opportunity costs in respect of
the Transaction. Immediately upon the signing of this
Agreement, Seller will seek approval of the Bankruptcy Court
for the Breakup Fee. The terms of any such order must be
acceptable to Buyer and its legal counsel, whose consent may
not be unreasonably withheld. If Seller does not obtain an
acceptable order approving the Breakup Fee no later than
January 24, 2002, then Buyer may terminate this Agreement
without any liability to Seller or Parent.
SECTION 13 CLOSING
13.1 Time and Place of Closing. The transfers and deliveries
contemplated by this Agreement (the "Closing") will take place
on the 2nd business day after the Bankruptcy Court enters the
Approval Order. However, if the Approval Order is then subject
to any stay of the Bankruptcy Court or another court of
competent jurisdiction, then the Closing shall occur on the
2nd business day after such stay is lifted or dissolved;
provided, further, that if the Closing does not occur on or
before January 31, 2002, or on or before February 14, 2002 if
the Bankruptcy Court's calendar does not facilitate a closing
before January 31, 2002, then Buyer may elect to terminate
this Agreement without any liability to Seller or Parent. The
Closing will take place at the law offices of Xxxxxx &
Xxxxxxxxxx LLP, 50 Public Square, 0000 Xxxxxxxx Xxxxx,
Xxxxxxxxx, Xxxx 00000, or any other date, time or place that
the parties agree upon. No transfer or delivery becomes
effective until all of the other transfers and deliveries
provided for in this Agreement have also been consummated. The
transfers and deliveries contemplated in this Agreement will
be deemed to have occurred and the Closing will be effective
as of the close of business on the Closing Date.
13.2 Deliveries at the Closing.
(a) Seller will deliver to Buyer those items set forth in
Schedule 13.2(a); and
(b) Buyer will deliver to Seller those items set forth in
Schedule 13.2(b).
SECTION 14 MISCELLANEOUS
14.1 Assignment. Without the consent of Seller, Buyer may assign
this Agreement or any part of its rights and obligations under
this Agreement to an affiliate of Buyer. Seller will sign and
deliver any documents reasonably requested by the assignee in
connection with any assignment. Any assignment does not
relieve Buyer of its obligations under this Agreement. Except
as provided in the first sentence of this paragraph, no
assignment by any party of this Agreement, or any right or
obligation under this Agreement may be made without the prior
written consent of all other parties, and any assignment
attempted without that consent is void.
21
14.2 Law Governing this Agreement. All matters pertaining to the
validity, construction, and effect of this Agreement are
governed by the laws of Ohio, without giving effect to any
principles or rules of conflict of laws that apply the laws of
another jurisdiction.
14.3 Due Diligence. Subject to Section 6.4, no investigation, or
lack of an investigation, by Buyer, or by any of its agents,
will be deemed to constitute or imply a waiver of any rights
that Buyer has, including any right to indemnification as the
result of any misrepresentation, breach of warranty, breach of
a covenant in favor of Buyer, or any other right of
indemnification provided in this Agreement. However, Buyer may
not assert a claim for indemnification that is based upon any
state of facts discovered by Buyer during the course of
Buyer's due diligence from which it is reasonable to conclude
that Seller has made a misrepresentation or breached a
warranty unless Buyer disclosed the state of facts to Seller
before the Closing Date.
14.4 Signing of Counterparts. This Agreement may be signed in
several counterparts, and each is an original for all
purposes. Facsimile signatures on any Transaction document
shall constitute an original signature.
14.5 Partial Invalidity. The parties do not intend to violate any
public policy, statutory or common law rules, regulations,
treaties or decisions of any government or agency of any
government. If any provision of this Agreement is judicially
or administratively interpreted or construed as being in such
violation as applied to any fact or circumstance, then the
provision will be modified by the parties or the tribunal to
the minimum extent necessary to render it valid. The violation
will not affect any other provision of this Agreement or the
same provisions applied to any other fact or circumstance, and
the remainder of this Agreement will remain binding upon the
parties.
14.6 Entire Agreement. This Agreement, and the attached documents
(if any), embody the entire agreement of the parties regarding
the subject matter of this Agreement. There are no promises,
terms, conditions or obligations related to the subject matter
of this Agreement other than those contained in this
Agreement. This Agreement, and the attached documents (if
any), supersede all previous communications or agreements,
either verbal or written, between the parties regarding the
subject matter of this Agreement. Without limiting the
generality of preceding sentences, no other communication
passing between the parties, concerning any matter during the
negotiation of this Agreement, is a part of this Agreement,
nor will it have the effect of modifying or adding to this
Agreement. The parties will request any tribunal (including
any arbitrator), to strictly apply the "parole evidence" rule
to any proceeding regarding the interpretation of this
Agreement.
14.7 Additional Documents. Each party will sign and deliver to all
of the other parties after the Closing any other documents or
instruments that are reasonably
22
necessary to effectuate the provisions and purpose of this
Agreement. Seller will perform all commercially reasonable
acts to cause any Authorizations issued to Seller to be
assigned or transferred to Buyer in order that Buyer may
conduct Seller's Aluminum Businesses after the Closing.
14.8 Amendment of Agreement; No Waiver.
(a) No amendment, modification, change or discharge of
any term or provision of this Agreement is valid or
binding unless it is in writing and signed by all the
parties.
(b) No waiver of any of the terms of this Agreement is
valid unless signed by the party against whom the
waiver is asserted.
14.9 Rules of Construction.
(a) All terms and words used in this Agreement,
regardless of the number and gender of their use,
will be construed to include any other number,
singular or plural, and any other gender, as the
context or sense of this Agreement requires, as if
the words were fully and properly written in the
required number and gender.
(b) Section headings are for reference purposes only and
do not affect the meaning of this Agreement.
(c) This Agreement may not be construed against any
party, each party having fully considered and
negotiated the terms of this Agreement with or
without the benefit of legal counsel as it so
chooses.
(d) The word "including" means "including, but not
limited to" - and is intended to provide examples
without intending to limit the generality of any
preceding phrase.
(e) The word "or" is not exclusive, but rather, in the
context of its use, includes the word "and."
(f) In computing any time period provided for in this
Agreement, the first day of the time period is not
counted but the last day of the time period is
counted. If the last day of a time period is a
Saturday, Sunday or legal holiday, then the time
period ends on the next day that is not a Saturday,
Sunday or legal holiday. Any action required to be
taken on a particular day must be taken before 5:00
p.m., Eastern Time on that day. For example, if an
action is required to be taken within 10 days after a
certain date, and if that date is June 10, then the
first day of the time period to be counted is June 11
and the action must be taken before 5:00 p.m.,
Eastern Daylight Time on June 20. However, if June 20
is a Saturday, then the
23
action must be taken before 5:00 p.m., Eastern
Daylight Time on Monday June 22, unless June 22 is a
holiday, in which case the action must be taken
before 5:00 p.m., Eastern Daylight Time on Tuesday
June 23.
14.10 No Third Party Beneficiaries. The parties do not intend to
confer any legal or contractual rights or benefits upon any
persons or Entities who are not a party to this Agreement,
either directly or incidentally.
14.11 Notices. A party will issue to the other party or parties any
demand, notice or communication that is required or permitted
under this Agreement to the attention of the appropriate
person named below by (i) written notice that is either
delivered personally, by U.S. mail, or by prepaid delivery
service to the address set forth below, or (ii) by facsimile
transmission or email transmission to the fax number or email
address set for below, retaining proof of delivery in each
instance.
If to Seller and Parent:
American Architectural Products Corporation
Attn: Xxxxxx Xxxxxxxxxxx, President
0000 Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, XX 00000-0000
TEL 000-000-0000
FAX 000-000-0000
And with a copy to:
American Architectural Products Corporation
000 Xxxxxxxx Xxxxxxxx Xxxx
Xxxxx 000, XXXX Xxxxxxxx
Xxxxxxxx, Xxxx 00000-0000
TEL 000-000-0000
FAX 000-000-0000
Attention: Xxxxxxxx X. Xxxxxxxxx, Secretary
If to buyer:
Profile Group, LLC
000 Xxxxx Xxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
TEL 000-000-0000
FAX 000-000-0000
Email xxxxxxxxx@xxxxxxx-xxxxxxxxx.xxx
Attn: Xxxxx X. Xxxxxxxx
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And with a copy to Xxxxx X. Xxxxx
Xxxxxx & Xxxxxxxxxx LLP
50 Public Square
0000 Xxxxxxxx Xxxxx
Xxxxxxxxx, Xxxx 00000
TEL 000-000-0000
FAX 000-000-0000
Email xxxxxx@xxxxxxxxx.xxx
14.12 Binding. This Agreement binds and inures to the benefit of the
parties, and their respective assigns, personal
representatives, and successors.
14.13 Incorporation by Reference. All Attachments are incorporated
into this Agreement by reference, as though fully set forth.
SECTION 15 DEFINITIONS
The terms identified below in this Section have the meanings indicated,
unless a different and common meaning of any of the terms is clearly indicated
by the context. Any variance or derivative of the following terms have
correlative meanings. Any reference to any provision of law, such as ERISA or
the Code, includes any successor provision adopted by any amendments, or any
applicable regulations or other law, modifying, amending, interpreting or
otherwise affecting the application of the law. Any reference to an agreement
includes any subsequent modification, restatement or supplement to the
agreement.
15.1 Acquisition Balance Sheet - means the September 30, 2001
Balance Sheet of Seller, a copy of which is attached as
Schedule 15.1.
15.2 Acquisition Statement of Income - means the September 30, 2001
Statement of Income of Seller, a copy of which is attached as
Schedule 15.2.
15.3 Acquisition Financial Statements - means the Acquisition
Balance Sheet and the Acquisition Statement of Income.
15.4 Affiliate - means: (i) any person directly or indirectly
controlling, controlled by or under common control with
another person; (ii) a person owning or controlling 50 percent
or more of the outstanding voting securities of such other
person; (iii) any officer, director, member or partner of such
person; or (iv) a person who is an officer, director, member
or partner or holder of 50 percent or more of any of the
voting interests of any person described in clauses (i)
through (iii) of this sentence, or (v) any family relative of
the Shareholders.
15.5 Agreement - means this asset purchase agreement together with
the Attachments.
15.6 Approval Order - is defined in Section 11.2.
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15.7 Assignment and Assumption Agreement - means that agreement
attached as Exhibit A.
15.8 Assumed Contract- means a Contract that is expressly assigned
to and assumed by Buyer under the Assignment and Assumption
Agreement.
15.9 Assumed Liabilities - is defined in Section 4.2.
15.10 Assumed Payables - means Seller's Liabilities that are assumed
by Buyer under Sections 4.2(a), (b), (c), (d) and (e).
15.11 Attachments - means the schedules and exhibits referred to in
this Agreement.
15.12 Authorization - means any Government consent, license, permit,
grant or any other governmental authorization.
15.13 Bankruptcy Court - means the U.S. Bankruptcy Court, Northern
District of Ohio (Youngstown).
15.14 Boardman Business - means the existing business operations of
Seller that is operated from the Boardman Location, including
the goodwill and going concern value of that business, and the
customer relations, and supplier relations.
15.15 Xxxxxxxx Location - means the premises known by the street
address of 0000 Xxxx Xxxx Xxxx, Xxxxxxxxxx, Xxxx.
15.16 Break-up Fee - is defined in Section 12.17.
15.17 Buyer - means Profile Group, LLC, an Ohio limited liability
company ("Buyer").
15.18 Buyer Indemnified Parties - means Buyer, its Affiliates, and
all of its and their officers, directors, members, and
employees.
15.19 CERCLA - means the Comprehensive Environmental, Response,
Compensation and Liability Act of 1980, 42 U.S.C. Section 9601
et. seq.
15.20 Closing - means the Closing of the Transaction described in
Section 13.1.
15.21 Closing Date - is day of the Closing defined in Section 13.1,
or any other date agreed upon by the parties, in writing. Any
reference to the Closing Date for the purpose of establishing
a point in time, or calculating a period of time, means 11:59
p.m., local time, Cleveland, Ohio, on the Closing Date.
15.22 Code - means the Internal Revenue Code of 1986, as amended.
15.23 Contaminant - means (i) any substance defined as hazardous
under CERCLA Section 101(14), (ii) any other substance deemed
hazardous by the United States
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Environmental Protection Agency under CERCLA Section 102(a),
(iii) petroleum (including crude oil or any fraction), (iv)
any substance deemed hazardous pursuant to RCRA
Section 1004(5), (v) infectious waste, (vi) any material that
is or may become radioactive, or any radon gas, (vii)
asbestos-containing material, including friable asbestos,
(viii) transformers or other equipment that contains
dielectric fluid containing polychlorinated biphenyls, or (ix)
any other hazardous or toxic substance, chemical, material,
matter, compound, mixture, solution, element, pollutant, or
waste regulated under any Environmental Law.
15.24 Contract - means any voluntarily entered written or oral
agreement or commitment that is legally binding on any person
or Entity under applicable Law.
15.25 Court Order - means any judgment, decree, injunction or order
of any federal, state, local or foreign court that is binding
on any person or Entity or its property under applicable Law.
15.26 Damages - means any losses, costs, expenses, interest,
penalties, fines, Liabilities, or any other deficiency or
damages, including losses or damages resulting from death,
personal injury, damage to property, lost profits,
consequential or incidental damages, and including reasonable
legal counsel fees, costs of litigation (including discovery
costs and reasonable expert fees, including those of an
environmental expert or consultant incurred during litigation
or any dispute resolution proceeding), and including fees
reasonably incurred investigating or attempting to avoid any
damages or to oppose the imposition of any costs, expenses,
interest or penalties.
15.27 Default Interest Rate - means an interest rate that is four
percent above the base lending rate announced and charged by
Xxxxxxxx Xxxx Xxxx, Xxxxxxxxx, Xxxx, from time to time, with
each change in the base lending rate by that institution
automatically and immediately changing the Default Interest
Rate under this Agreement, without notice.
15.28 Effective Date - means the date set forth in the first
paragraph of this Agreement.
15.29 Employee Benefit Plan - means any employee benefit plan within
the meaning of ERISA Section 3(3), other than a Multiemployer
Plan.
15.30 Entity - means a corporation, partnership, sole
proprietorship, joint venture, limited liability company, or
other form of organization whether formed for the conduct of a
business or profit seeking activity, active or passive, or
not-for-profit.
15.31 Environment - means the broadest definition of environment as
contemplated by CERCLA Section 101(8).
27
15.32 Environmental Law - means any Law that pertains to the
environment, and includes CERCLA; RCRA; XXXX; the Federal
Water Pollution Control Act, 33 U.S.C. Section 1251 et. seq.;
the Clean Air Act, 42 U.S.C. Section 7401 et. seq.; the Clean
Water Act, 33 U.S.C. Section 1251 et seq.; the Safe Drinking
Water Act , 42 U.S.C. Section 300f et seq.,; the Toxic
Substances Control Act, 15 U.S.C. Section 2601 et seq.; the
Hazardous Materials Transportation Act, 49 U.S.C. Section 1801
et seq.; the National Environmental Policy Act , 42
U.S.C. Section 4321 et seq.; the Emergency Planning and
Community Right to Know Act, 42 U.S.C. Section 11001 et seq.;
the Federal, Insecticide, Fungicide and Rodenticide Act, 7
U.S.C. Section 136 et seq.; and any applicable Regulation of
any federal or state agency.
15.33 ERISA - means the Employee Retirement Income Security Act of
1974, as amended.
15.34 Excluded Assets - means the assets that are described in
Section 2.
15.35 GAAP - means United States generally accepted accounting
principles as determined by the Financial Accounting Standards
Board.
15.36 Government - means the federal government and any foreign,
state, municipal, county, or other local government, including
any agencies, bureaus, boards, commissions, committees,
departments, or other governmental bodies.
15.37 Government Proceeding - means any proceeding, audit, inquiry,
or investigation by a Government, including any judicial
proceeding, arbitration, administrative proceeding, or
criminal prosecution.
15.38 Indemnitee - means a party who is entitled to be indemnified
under this Agreement.
15.39 Indemnitor - means a party who is obligated to indemnify under
this Agreement.
15.40 Intellectual Property - means any trade names, fictitious
names, assumed names, trade marks, service marks, copyrights
and works of authorship, and all registrations and
applications for the foregoing, and all licenses or license
rights related to, or based upon, the foregoing, software
licenses and know-how licenses, all domestic and foreign
patents and patent rights, industrial models and all United
States and foreign patent rights covered by, disclosed in or
otherwise related to any patents, all registrations and
applications for patents, and all reissues, divisions,
continuations-in-part, re-examinations, and extensions of
patents, together with the right to xxx for past infringement
and improper, unlawful, or unfair use of any of the foregoing.
15.41 Interim Period - is defined in Section 12.1.
15.42 IRS - means the Internal Revenue Service.
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15.43 Law - means any federal, state, local law or any governmental
requirement of any kind, whether legislatively, judicially, or
administratively promulgated, including any statutes,
ordinances, rules, rulings, pronouncements, regulations,
directives, orders, case decisions, Attorney General opinions,
and the common law.
15.44 Leased Real Property - means the real property described in
Schedule 5.11.
15.45 Liability - means the obligation of a person or an Entity, at
any point in time, whether known or unknown, contingent or
absolute, whether recorded on its books, arising or resulting
in any way from facts, events, Contracts, obligations,
transactions, or occurrences.
15.46 Lien - means any mortgage, security interest, adverse claim,
pledge, encumbrance, charge, imposition, or legal or equitable
claim of any nature on any property securing the payment of a
Liability.
15.47 Non-Assignable Asset - means any asset (including any property
or legal right) that would be a Purchased Asset, except that
the assignment or transfer of such asset would: (i) require
the consent or waiver of a third party Entity or Government,
and such waiver has not been obtained; or (ii) constitute a
breach of the terms of any agreement pertaining to such asset;
or (iii) constitute a violation of any Law; or (iv) not be
immediately practicable.
15.48 Norton Business - means the existing business operations of
Seller that is operated from the Norton Location, including
the goodwill and going concern value of that business, and the
customer relations, and supplier relations.
15.49 Norton Location - means the premises known by the street
address of 0000 X. Xxxxxxxxx Xxxxxxxxx Xxxx, Xxxxxx, Xxxx.
15.50 Notice - means any summons, citation, directive, order,
letter, or any communication, written or oral, actually
delivered or threatened, from any Government, any other
Entity, or any individual, concerning any intentional or
unintentional act or omission that has resulted, or that may
result, in the Release of Contaminants into the Environment.
15.51 OSHA - means the Occupational Safety and Health Act , 29
U.S.C. Section 651 et seq.
15.52 Other Financial Statements - means the financial statements of
Seller delivered to Buyer other than the Acquisition Financial
Statements.
15.53 Other Plan - means any employment, noncompetition, management,
agency, or consulting agreement, bonus, profit sharing,
deferred compensation, incentive, stock option, stock
ownership, or stock purchase plan, or other similar plan,
severance pay plan, policy, or arrangement intended to provide
Seller's
29
employees (or any of them) with an economic benefit, whether
in written form, which does not constitute an Employee Benefit
Plan or a Multiemployer Plan.
15.54 Parent - means American Architectural Products Corp., a
Delaware corporation.
15.55 Pension Plan - means a "Pension Plan" or an "Employee Pension
Benefit Plan" as defined in ERISA Section 3(2) and the
applicable Regulations.
15.56 Private Litigation - means any lawsuit, arbitration,
mediation, or other adversary proceeding that does not
constitute a Government Proceeding.
15.57 Prohibited Activities - is defined in Section 10.6.
15.58 Proprietary Information - means all confidential or
proprietary information, including trade secrets, know-how,
business information, formula, technical data, customer and
supplier information and lists, pricing and cost information,
business and marketing plans, employee information, research
and development, ideas and techniques, together with the right
to xxx for past infringement and improper, unlawful, or unfair
use of any of the foregoing, that pertains to Seller's
Aluminum Businesses.
15.59 Purchase Price - means the purchase price paid for the
Purchased Assets, including the Assumed Liabilities, and the
consideration paid for the restrictive covenants, all of which
is described and calculated in Section 3.1.
15.60 Purchased Assets - means the assets that are sold by Seller to
Buyer in accordance with this Agreement, and as more
specifically described in Section 1.
15.61 Regulation - means any regulation, order, or rule of any
Government, including those covering taxation, the
environment, safety, health, transportation, bribery,
record-keeping, zoning, employment, antitrust, or securities
regulation matters.
15.62 Release - means releasing, spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, escaping,
leaching, migrating, disposing, or dumping.
15.63 Reportable Event - means a "Reportable Event" as defined in
ERISA Section 4043(b).
15.64 Reportable Quantity - means the definition given to the phrase
by, and are those quantities specified by, the Administrator
of the United States Environmental Protection Agency under
CERCLA Section 102(a).
15.65 Restricted Area - means the geographic area described in
Schedule 10.6.
15.66 RCRA - means the Resource Conservation and Recovery Act, 42
U.S.C. Section 6901 et. seq.
30
15.67 XXXX - means the Superfund Amendment and Re-authorization Act.
15.68 Seller - means American Weather-Seal Co., a Delaware
corporation.
15.69 Seller's Aluminum Businesses - means the Xxxxxxxx Business and
the Norton Business.
15.70 Seller Indemnitor Parties - means Parent and Seller.
15.71 Tax - means any Government charge, including any tax,
assessment, levy, or fee, and all associated interest and
penalties.
15.72 Transaction - means the transaction contemplated by this
Agreement, and the related exhibits.
15.73 Welfare Plan - means a "Welfare Plan" or an "Employee Welfare
Benefit Plan" as defined in ERISA Section 3(1) and the
applicable Regulations.
[end of terms - signatures on the next page]
The parties have signed this Agreement, intending to be legally bound,
as of the Effective Date.
SELLER:
\s\ Xxxxxx Xxxxxxxxxxx
--------------------------------------
Its President
PARENT:
\s\ Xxxxxx Xxxxxxxxxxx
--------------------------------------
Its President
BUYER:
\s\ Xxxxx X. Xxxxxxxx
--------------------------------------
Its President
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