ASSET TRANSFER AGREEMENT
THIS ASSET TRANSFER AGREEMENT (the "Agreement") is entered into by and
between MAGNETEC CORPORATION, a Connecticut corporation ("Magnetec"), and TRIDEX
CORPORATION, a Connecticut corporation ("Tridex").
WHEREAS, Magnetec desires to transfer to Tridex and Tridex desires to
acquire from Magnetec all of the assets owned and used by Magnetec in Magnetec's
ribbon business (the "Ribbon Business").
NOW, THEREFORE, in consideration of the mutual promises contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereby agree as follows:
1. Transfer of Assets.
(a) Magnetec hereby agrees to transfer to Tridex, at the Closing (as
defined in Section 7.1) all of Magnetec's right, title and interest in and to
the assets of Magnetec listed on Schedule 1 attached hereto, which constitute
all of the equipment, inventory (whether components, work-in progress or
finished goods), unfilled customer purchase orders, accounts receivable,
packaging, sales literature and other supplies used by Magnetec exclusively in
the conduct of the Ribbon Business (the "Assets").
(b) The Assets are being transferred to Tridex "as is" and "where is"
without any warranties of quality or fitness except as hereinafter set forth.
2. Assumption of Liabilities. Tridex hereby agrees to assume all
liabilities and obligations of Magnetec (a)for accrued but unused vacation days
as set forth on Schedule 2(a) attached hereto, due to employees engaged in the
Ribbon Business who, in connection with the Closing, cease to be employees of
Magnetec and become employed by Tridex and (b)under any purchase orders
submitted by customers of Magnetec as set forth on Schedule 2(b)
attached hereto which remain unperformed or unfilled at the time of the Closing
and are assigned to Tridex by Magnetec.
3. Consideration for Transfer of Assets. Tridex and Magnetec agree that, at
Closing, Magnetec shall accept, in consideration for the transfer of the Assets,
cancellation of intercompany indebtedness, owed by Magnetec to Tridex, in an
amount equal to the book value of the Assets at the date of the closing. Tridex
and Magnetec acknowledge that such book value was approximately $228,000 at June
29, 1995.
4. Representations and Warranties of Magnetec. Magnetec represents and
warrants to Tridex as follows:
4.1 Corporate Status. Magnetec is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Connecticut.
4.2 Due Authorization. The entry by Magnetec into this Agreement and
the transfer of the Assets to Tridex hereunder have been duly authorized by all
requisite corporate action.
4.3 Title to Assets. Magnetec has good and marketable title to the
Assets free and clear of all liens and encumbrances (except for a lien on the
Assets held by Fleet Bank, National Association pursuant to an Amended and
Restated Credit Agreement dated as of December 15, 1995 and last amended on
March 15, 1996 (the "Credit Agreement")).
4.4 Condition of Assets. The inventory included in the Assets is of a
quality useable and saleable in the ordinary course of business. All other
tangible personal property, including manufacturing equipment, transferred
hereunder is in reasonably good operating condition and repair, subject to
normal wear.
4.5 Sufficiency of Assets. The Assets transferred by Magnetec to
Tridex pursuant to this Agreement constitute all of the assets used by Magnetec
exclusively in the conduct of the Ribbon Business and, in combination with the
services to be provided by Magnetec to Tridex pursuant to a Manufacturing
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Services Agreement, in the form attached hereto as Exhibit 7.2(b) (the
"Manufacturing Services Agreement"), are sufficient to conduct the Ribbon
Business as presently conducted by Magnetec.
5. Representations and Warranties of Tridex.
5.1 Corporate Status. Tridex is a corporation duly organized, validly
existing and in good standing under the laws of the State of Connecticut.
5.2 Due Authorization. The entry by Tridex into this Agreement and the
transfer of the assets from Magnetec to Tridex hereunder has been duly
authorized by all requisite corporate action.
6. Conditions Precedent to Closing.
6.1 Conditions Precedent to Tridex's Closing.
The obligations of Tridex under this Agreement are subject to the
satisfaction, at or before the Closing, of the conditions set out below.
(a) Accuracy of Representations. All representations and warranties
made by Magnetec in this Agreement will be true as of the Closing as though made
at that time.
(b) Absence of Litigation. No action, suit, or proceeding before any
court or any governmental body or authority, pertaining to the transaction
contemplated by this Agreement or its consummation, will have been instituted or
threatened as of the Closing.
(c) Bank Consent. Fleet Bank, National Association shall have
consented to the transactions contemplated by this Agreement, including but not
limited to the transactions under the Manufacturing Services Agreement.
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6.2 Conditions Precedent to Magnetec's Closing.
The obligations of Magnetec under this Agreement are subject to the
satisfaction, at or before the Closing, of the conditions set out below.
(a) Accuracy of Representations. All representations and warranties
made by Tridex in this Agreement will be true as of the Closing as though made
at that time.
(b) Absence of Litigation. No action, suit, or proceeding before any
court or any governmental body or authority, pertaining to the transaction
contemplated by this Agreement or its consummation, will have been instituted or
threatened as of the Closing.
(c) Bank Consent. Fleet Bank, National Association shall have
consented to the transactions contemplated by this Agreement, including but not
limited to the transactions under the Manufacturing Services Agreement.
7. Closing.
7.1 Time and Place.
The transfer of the Assets by Magnetec to Tridex (the "Closing") shall
take place on September 27, 1996 at the offices of Magnetec, 0 Xxxxx Xxxx,
Xxxxxxxxxxx, Connecticut at 10:00 a.m., or at such other time and place as the
parties shall mutually agree, but in no event later than December 31, 1996.
7.2 Magnetec's Obligations at Closing.
At the Closing, Magnetec will deliver to Tridex the following
documents:
(a) An Assignment and Assumption Agreement, in substantially the form
attached hereto as Exhibit 7.2(a) (the "Assignment and Assumption Agreement"),
duly executed by Magnetec, assigning and transferring to Tridex all of
Magnetec's right, title and interest in and to the customer purchase orders
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which remain unfilled or unperformed as of the date of the Closing.
(b) The Manufacturing Services Agreement, in substantially the form
attached hereto as Exhibit 7.2(b), duly executed by Magnetec, regarding the
provision of services to Tridex by Magnetec with respect to the operation of the
Ribbon Business.
(c) An Instrument of Transfer, in substantially the form attached
hereto as Exhibit 7.2(c), transferring the Assets from Magnetec to Tridex.
7.3 Tridex's Obligation at Closing.
At the Closing, Tridex will deliver to Magnetec the following:
(a) The Assignment and Assumption Agreement, duly executed by Tridex.
(b) The Manufacturing Services Agreement, duly executed by Tridex.
(c) Proof of cancellation of indebtedness by Tridex.
8. Further Assurances. Magnetec and Tridex will execute and deliver such
additional documents and take such additional actions as may be necessary to
carry out the transactions contemplated by this Agreement.
9. Titles. The title of this Agreement and the titles of sections and
subsections, and of exhibits, are for convenience of reference only and will not
be considered in the construction or interpretation hereof.
10. Survival. All representations, warranties and agreements contained in
this Agreement will survive for six (6) months from the date of the Closing.
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11. Entire Agreement. This Agreement and the schedules hereto constitute
the entire agreement and understanding between the parties in respect of the
subject matter hereof and supersede any prior or contemporaneous agreement or
understanding between the parties, written or oral, which relates to the subject
matter hereof.
12. Successors and Assigns. References in this Agreement to the parties
hereto will be deemed to include their successors and permitted assigns and this
Agreement will be binding upon and inure to the benefit of the parties hereto
and their successors and permitted assigns.
13. Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Connecticut.
14. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original and all of which together shall
constitute one and the same instrument.
15. Amendments. This Agreement may be amended or modified only by a written
instrument signed by the parties hereto.
IN WITNESS WHEREOF, the parties have executed this Agreement on the 31st
day of July, 1996.
MAGNETEC CORPORATION
By: /s/ Xxxx X. Xxxxxxxx
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Title: President
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TRIDEX CORPORATION
By: /s/ Xxxxxxx X. Xxxx
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Title: Senior Vice President and Chief
Financial Officer
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