Exhibit 10.25
ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT (this "Agreement") dated as of
December 4, 2001 is between Naplak Nomis, Inc. (the "Buyer"), and The
Xxxxxx-Xxxxxxxx Group Ltd. (the "Seller").
In consideration of the mutual agreements contained herein, the
parties hereto agree as follows:
ARTICLE I
PURCHASE AND SALE OF ASSETS
AND ASSUMPTION OF CERTAIN LIABILITIES
1.1 Purchase and Sale of Assets. At the Closing (as defined in
Section 2.3), Seller shall sell to Buyer and Buyer shall purchase from
Seller all of the Inventory (such term and other capitalized terms used and
not otherwise defined herein having the meanings assigned to them in
Article X) of Seller's retail/home crafts and sewing business (the
"Business"). Schedule 1.1 hereto lists all of the Inventory and sets forth
Seller's cost for such Inventory and the amount of each type of such
Inventory.
1.2 Other Assets. At the Closing, Seller shall sell to Buyer and
Buyer shall purchase from Seller, for $1, the following additional assets
(together with the Inventory, the "Acquired Assets"):
(i) Subject to Section 2.4, all unfilled orders or portions
thereof from customers of the Business (all such orders are set forth on
Schedule 1.2 (i) hereto);
(ii) All of the Intellectual Property, as more particularly
set forth on Schedule 10-B hereto, and Assigned Claims;
(iii) Subject to Section 2.4, all of Seller's rights under
the License Agreements (as defined in Section 1.3) and the other Assumed
Contracts (as defined in Section 1.3);
(iv) Seller's AS400 computer, printers related thereto, and
Seller's proprietary software related thereto (the "AS400 Software");
(v) Seller's telephone system hardware and software related
thereto;
(vi) Subject to Section 2.4, all of Seller's rights under
the equipment leases as set forth on Schedule 1.2(vi) hereto; and
(vii) Certain furniture and office materials as mutually
agreed by the parties and set forth on Schedule 1.2(vii) hereto.
1.3 Liabilities Assumed. Buyer shall assume as of the Closing Date
and thereafter shall discharge and satisfy the following obligations and
liabilities of Seller in accordance with the terms thereof (the "Assumed
Liabilities"): (i) all of the obligations of Seller accruing and arising on
and after the Closing Date under those Contracts (as defined in Section
10.1) listed on Schedule 1.3(a) hereof, (ii) all of the obligations of
Seller with respect to the open portion of any purchase orders from
customers of the Business (the "Assigned Customer Orders") and purchase
orders or commitments to suppliers and processors relating to the Business
("Assigned Purchase Orders"), and (iii) all of the obligations of Seller
accruing and arising on and after the Closing Date under those license
agreements listed on Schedule 1.3(b) hereof ("License Agreements" and,
together with the Assigned Purchase Orders and the Assigned Customer
Orders, the "Assumed Contracts").
1.4 Transition Services. Buyer agrees that for the period
beginning on the Closing Date and ending on the date Buyer terminates its
use of a portion of Seller's offices located at 0000 Xxxxxx xx xxx
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Premises"), Buyer shall promptly
reimburse Seller upon presentation of an invoice therefor, an amount equal
to its pro rata share of the expenses related to the use of the Premises,
including without limitation a pro rata portion of the rent and utilities
expenses and telephone expenses. Pro rata expenses shall be determined
based upon the percent of square feet of the Premises devoted to the
Business during this period. Buyer agrees to terminate its use of the
Premises on or before December 31, 2001.
ARTICLE II
CONSIDERATION FOR TRANSFER AND CLOSING
2.1 Purchase Price. Buyer will pay Seller an aggregate purchase
price (the "Purchase Price") equal to (i) the book value of the Inventory
as of the Closing Date, which shall be Seller's cost for such Inventory as
set forth on Schedule 1.1 hereof plus (ii) the sum of all amounts paid by
Seller for freight charges with respect to work in process Inventory (at
the rate of 2 1/2(cent) per yard) relating to shipment of Inventory prior
to Closing minus (iii) the amounts of advances, deposits or prepayments
received by Seller from Buyer prior to the Closing pursuant to certain
sales of Inventory from Seller to Buyer. Buyer and Seller agree that Buyer
will hold back an amount equal to $50,000 of the Purchase Price (the "Hold
Back Amount") pursuant to the terms of Section 2.6.
For the purposes of this Agreement, the book value of greige goods
located at United States-based converters shall be the dollar amount paid
by Seller for such greige goods and the book value of finished goods
located at United States-based converters shall be the dollar amount paid
by Seller for such goods plus the dollar amount paid by Seller for the
finishing of such goods, including without limitation dyeing costs.
2.2 Allocation of the Purchase Price. The Purchase Price will be
allocated by Buyer and Seller among the Acquired Assets as set forth on
Schedule 2.2 hereof. Each party agrees to report this transaction for
Federal and State tax purposes in accordance with this allocation of the
Purchase Price.
2.3 Closing. The closing (the "Closing") of the transactions
contemplated by this Agreement will take place at the offices of Xxxxxxxx
Xxxxx & Deutsch LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx at 10:00 a.m. on
such date as the parties shall mutually agree (the "Closing Date");
provided, however, that the Closing Date shall not be later than December
19, 2001.
(a) Deliveries by Seller. At the Closing, Seller will
deliver to Buyer (i) a duly executed General Xxxx of Sale and Assignment
and Assumption Agreement in the form annexed hereto as Exhibit A ("Xxxx of
Sale"), which shall include the assignment of all Intellectual Property and
the assignment and assumption of the License Agreements and other Assumed
Contracts; (ii) executed copies of the permits, consents and lien release
documents referred to in Sections 8.2 and 8.3 hereof; and (iii) such other
instruments and documents as shall be reasonably requested by Buyer to vest
in Buyer the title in and to the Acquired Assets and to otherwise comply
with the terms of this Agreement.
(b) Deliveries by Buyer. At the Closing, Buyer shall deliver
to Seller, (i) the Purchase Price; (ii) a duly executed copy of the Xxxx of
Sale in the form annexed hereto as Exhibit A; and (iii) such other
instruments and documents as shall be reasonably requested by Seller to
comply with the terms of this Agreement.
2.4 Consents. Nothing in this Agreement shall be construed as an
attempt or agreement to assign any contract, license, lease, sales order,
purchase order, insurance policy or other agreement which is nonassignable
without the consent of the other party or parties thereto unless such
consent shall have been given. Seller agrees to use commercially reasonable
efforts to obtain all such consents, provided that Seller shall not be
required to make any payment in connection therewith. Whether or not any
consent to assignment has been received, Buyer shall make all payments
under Assumed Contracts directly to the counterparty. Inventory that is
acquired by Seller under any Assumed Contract shall be deemed to have been
immediately resold by Seller to Buyer in accordance with the terms hereof.
Buyer agrees that no representation, warranty or covenant made herein by
Seller shall be breached or deemed breached as a result of Seller's failure
to obtain any third party consent to the assignment of any of the Assumed
Contracts.
2.5 Inventory Examination. On the Closing Date, Buyer and Seller
shall cooperate in, and each be present at, a review of the Inventory
located at S&S North, 000 XxXxxxxxx Xxxxxx, Xxxxxxx, Xxx Xxxxxx 00000 ("S&S
North") to confirm the amount and cost of such Inventory (the "S&S
Inventory") as set forth on such Schedule 1.1 (the "Examination");
provided, that Buyer and Seller agree that the Inventory stored at
locations separate from S&S North shall be confirmed, on the Closing Date,
by third party confirmations and then reconciled with the books and records
of Seller; and provided further, such confirmation of the amount and cost
of such Inventory shall be final and not subject to the terms of this
Section 2.5 or Section 2.6. To the extent such confirmations are not
received on the Closing Date for any such location, Buyer and Seller shall
negotiate in good faith alternative procedures to verify the portion of
Schedule 1.1 reflecting Inventory stored at such location to Buyer's
reasonable satisfaction. If the Buyer and Seller agree on the amount and
cost of the S&S Inventory, the Examination shall be the final determination
of the amount and cost of the S&S Inventory. If Buyer and Seller do not
agree on the cost or the amount of the S&S Inventory, then the parties
shall attempt to reconcile their dispute in good faith. In the event they
are not able to reconcile their dispute within ten (10) business days after
the Examination, Buyer and Seller shall submit the dispute to a mutually
agreeable auditor (the "Auditor") for a final determination of the amount
and cost of the S&S Inventory. The expenses for such auditor shall be
equally shared by Buyer and Seller. If Buyer and Seller do not agree within
twenty (20) business days after the Examination on the cost and the amount
of Inventory stored at any other location than S&S North, such Inventory
shall be excepted from the purchase and sale hereunder and the Purchase
Price shall be adjusted accordingly.
2.6 Hold Back Amount. If the final determination of the total cost
of S&S Inventory set forth on Schedule 1.1, pursuant to the terms of
Section 2.5, reveals that the total cost of S&S Inventory is (x) less than
such cost set forth on Schedule 1.1 (the amount of such difference, the
"Inventory Shortfall Amount"), Buyer shall be entitled to retain a portion
of the Hold Back Amount equal to the Inventory Shortfall Amount and shall
promptly, but no later than ten (10) business days after the Examination or
the final determination of the Auditor, as the case may be, remit to Seller
an amount equal to the Hold Back Amount minus the Inventory Shortfall
Amount; provided that if the Inventory Shortfall Amount exceeds the Hold
Back Amount, Buyer shall retain the Hold Back Amount and Seller shall
refund to Buyer a portion of the Purchase Price equal to any such excess;
or (y) greater than such cost set forth on Schedule 1.1 (the amount of such
difference, the "Inventory Excess Amount"), Buyer shall promptly, but no
later than ten (10) business days after the Examination or the final
determination of the Auditor, as the case may be, remit to Seller an amount
equal to the Hold Back Amount plus the Inventory Excess Amount.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF THE SELLER
Seller represents, covenants and warrants to Buyer as set forth
below. Each of such representations and warranties are correct and complete
as of the Closing:
3.1 Corporate Organization, Etc. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Rhode Island and has full corporate power and authority to carry
on its business as it is now being conducted and to own the properties and
assets it now owns.
3.2 Authorization, Etc. Seller has full corporate power and
authority and has taken all corporate action necessary: (i) to own or lease
and operate the Acquired Assets; (ii) to enter into this Agreement; and
(iii) to carry out the transactions contemplated hereby. This Agreement has
been duly executed and delivered by Seller and is a legal, valid and
binding obligation of Seller enforceable against Seller in accordance with
its terms, except as such enforcement is limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement
of creditor's rights generally.
3.3 No Violation. Neither the execution and delivery of this
Agreement nor the consummation of the transactions contemplated hereby will
violate any provision of the Certificate of Incorporation or By-Laws of
Seller, or result in the encumbrance upon any of the Acquired Assets or
violate any statute or law or any judgment, decree, order, regulation or
rule of any court or governmental authority binding upon Seller.
3.4 No Undisclosed Liabilities; Etc. Except as set forth on
Schedule 3.4, Seller has no liabilities or obligations of any nature
(absolute, accrued, contingent or otherwise) which relate to the Business
that are not otherwise trade liabilities incurred by Seller in the ordinary
and usual course of business and in a manner consistent with Seller's
historical practices.
3.5 Sales and Gross Margin Information. Set forth in Schedule 3.5
are the sales of the Business, in dollars, and the gross margin for such
sales for the eight months ended August 31, 2001. Based on the information
in Schedule 3.5, the Company believes that average gross margin for the
Business for the eight months ended August 31, 2001 was approximately 20%.
The results for such eight-month period contain an amount of clearances of
aged goods at a discount to the book value of such goods.
3.6 Title to Properties; Encumbrances. Except as set forth in
Schedule 3.6, the Seller has good, valid and marketable title to all the
Acquired Assets and, as of the Closing, all the Acquired Assets will be
free of liens, claims and encumbrances.
3.7 Litigation. Except as set forth in Schedule 3.7, there is no
action, order, writ, injunction, judgment or decree, or any claim, suit,
litigation, labor dispute, arbitrational action, inquiry, proceeding or
investigation by or before any court or governmental or other regulatory or
administrative agency or commission pending or, to the best of Seller's
knowledge, threatened against or involving the Business or the Acquired
Assets, or which questions or challenges the validity of this Agreement or
any action taken or to be taken by the Seller pursuant to this Agreement or
in connection with the transactions contemplated hereby; and the Seller has
not received any notice for any such action, proceeding or investigation.
Seller is not subject to any judgment, order or decree entered in any
lawsuit or proceeding which may reasonably be expected to have an adverse
effect on the Business or the Acquired Assets.
3.8 Consents. Schedule 3.8 sets forth and identifies, including
the name of the party and the address, all consents, assignments, releases,
waivers, and approvals required of any person, entity or other third party
necessary for the consummation of the transactions contemplated hereby,
including but not limited to under the License Agreements and the other
Assumed Contracts.
3.9 Compliance with Law. Except as set forth on Schedule 3.9, the
Business has been conducted in all material respects in accordance with and
is in compliance with, or in conformity in all material respects with all
applicable laws, statutes, rules, orders, ordinances, judgments, decrees,
or regulations and other requirements of all governmental authorities
having jurisdiction over Seller.
3.10 Brokers and Finders. Neither Seller nor any of its officers,
directors or employees has employed any broker or finder or incurred any
liability for any brokerage fees, commissions or finders' fees in
connection with the transactions contemplated by this Agreement and Seller
agrees to indemnify and hold Buyer harmless from any liability, loss, cost,
claim and/or demand that any broker or finder may have in connection with
this transaction.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller as set forth below. Each
of such representations and warranties are correct and complete as of the
Closing:
4.1 Corporate Organization, Etc. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of the
Commonwealth of Massachusetts.
4.2 Authorization, Etc. Buyer has full corporate power and
authority to enter into this Agreement and to carry out the transactions
contemplated hereby. This Agreement has been duly executed and delivered by
Buyer and is a legal, valid and binding agreement of Buyer enforceable in
accordance with its terms.
4.3 Brokers and Finders. Neither Buyer nor any of its officers,
directors or employees has employed any broker or finder or incurred any
liability for any brokerage fees, commissions or finders' fees in
connection with the transactions contemplated by this Agreement and Buyer
agrees to indemnify and hold Seller harmless from any liability, loss,
cost, claim and/or demand that any broker or finder employed by Buyer may
have in connection with this transaction.
4.4 Binding Obligation. This Agreement constitutes the legal,
valid and binding obligation of Buyer and is enforceable against Buyer in
accordance with its terms, except as such enforcement is limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditor's rights generally.
4.5 Litigation. There is no judicial or administrative action,
suit, proceeding or governmental investigation pending or, to the best of
Buyer's knowledge, threatened before any court or tribunal or governmental
instrumentality by or against Buyer which question the validity of this
Agreement or the transactions contemplated hereby.
ARTICLE V
COVENANTS OF THE SELLER
Seller covenants and agrees with Buyer that Seller shall use
reasonable commercial efforts to obtain, prior to the Closing, all
consents, assignments, releases, waivers, approvals, permits, registrations
and conveyances necessary and appropriate to be obtained by Seller to
effect the consummation of the transactions contemplated hereby, including
without limitation, the License Agreements and the other Assumed Contracts.
ARTICLE VI
ADDITIONAL COVENANTS OF THE PARTIES
6.1 Seller's Employees. Buyer will extend offers of employment to
Seller's employees as of the Closing Date with a hire date effective as of
the Closing Date (such employees are hereinafter referred to as the
"Rehired Employees"), which offers shall be on terms and conditions which
Buyer shall determine in its sole discretion. Nothing contained herein
shall be deemed to create in any Rehired Employee any right to be treated
by Buyer as other than a new employee of Buyer. Seller shall terminate the
employment of all of its employees with respect to the Business as of the
Closing Date and shall, except as otherwise provided herein, pay all
obligations with respect to such employees, and fulfill all obligations
under the applicable employee plans (including any benefits to which such
employee is entitled, whether pursuant to an agreement with Seller,
applicable law or otherwise) in respect of all periods prior to Closing
Date; provided, however, that if Seller provides severance for any employee
who becomes a Rehired Employee, Buyer shall reimburse the amount of such
severance to Seller. Year-end or holiday bonuses for the calendar year
2001, if any, due and owing Seller's employees shall be the responsibility
of Seller only; provided, however, that to the best knowledge of Seller no
such bonuses are due and owing such employees. Any and all decisions to
offer employment to Rehired Employees shall be made by Buyer in its sole
discretion, in compliance with all applicable laws, and Seller shall have
no responsibility for any such hiring decision nor any liability related
to, or otherwise arising from Buyer's employment of any such employees. A
list of the Seller's employees to whom Buyer contemplates making offers of
employment is attached hereto as Schedule 6.1(a).
Nothing contained in this Agreement shall confer upon any employee
of Seller, including any Rehired Employee, any right with respect to
continuance of employment by Buyer, nor shall anything herein interfere
with the right of Buyer to terminate the employment of any of the Rehired
Employees at any time, with or without cause, or restrict Buyer in the
exercise of its independent judgment in modifying any of the terms and
conditions of the employment of the Rehired Employees. No provision of this
Agreement shall create any third party beneficiary rights in any Rehired
Employee, any beneficiary or dependents thereof, or any collective
bargaining representative thereof, with respect to the compensation, terms
and conditions of employment and benefits that may be provided to any
Rehired Employee by Buyer or under any benefit plan which Buyer may
maintain.
6.2 Use of Name and Change of Name. Effective upon Closing, Seller
hereby conveys, sells and transfers to Buyer the exclusive right to use the
names "Xxxxxx-Xxxxxxxx Group Ltd." and "Xxxxxx-Xxxxxxxx" and any likenesses
thereof. The Seller shall file an amendment to its Certificate of
Incorporation on the Closing Date so as to change its name and will file as
promptly as practicable after the Closing, in all jurisdictions in which it
is qualified to do business, any documents necessary to reflect such change
in its corporate name or to terminate its qualification therein. Seller
shall promptly provide Buyer with copies of all such filed amendments and
name changes. Seller reserves an irrevocable, paid-up, nonexclusive,
worldwide license (excluding the right to sublicense, other than to a
factor or other lender) to use the names "The Xxxxxx-Xxxxxxxx Group Ltd.",
"Xxxxxx-Xxxxxxxx" and derivatives thereof in connection with (i) the
collection of receivables with respect to the Business, (ii) the assertion
of claims that are not Assigned Claims and (iii) for a period of not more
than 90 days after the Closing Date, for check writing and other
administrative purposes.
6.3 Collections of Accounts Receivable; Settlement of Non-Assigned
Claims. All accounts receivable of the Business of the Seller generated
prior to the Closing Date, and all claims of Seller that are not Assigned
Claims, shall remain the sole and exclusive property of Seller (or Seller's
factor, as the case may be). Accordingly, Buyer shall have no authority to
grant any markdowns, discounts, allowances, adjustments or other
accommodations with respect to accounts receivable generated prior to the
Closing Date or to compromise any such claims that are not Assigned Claims.
If any payments by customers in respect of accounts receivable generated
prior to the Closing Date or payments by processors with respect to claims
that are not Assigned Claims are inadvertently paid or credited to Buyer or
its factor, Buyer shall, promptly after the receipt thereof, make a payment
in like amount to Seller. Similarly, Seller shall have no authority to
grant any markdowns, discounts, allowances, adjustments or other
accommodations with respect to Buyer's post-Closing Date accounts
receivable or with respect to Assigned Claims. Further, in the event that
any customer inadvertently pays to Seller or its factor any amount due with
respect to an account receivable generated by Buyer subsequent to the
Closing Date, Seller shall, or Seller shall use its best efforts to cause
its factor, to remit such payment to Buyer. If any payments by customers in
respect of post-Closing Date accounts receivable of Buyer are inadvertently
paid to Seller or its factor, Seller shall, promptly after the receipt
thereof, remit such payment to Buyer. The parties shall, in all instances,
cooperate in good faith to resolve disputes concerning their respective
accounts receivable and claims, and Buyer shall provide reasonable
assistance to Seller with respect to (i) the collection of receivables with
respect to the Business, (ii) the assertion of claims that are not Assigned
Claims and (iii) other transition matters.
ARTICLE VII
CONDITIONS TO SELLER'S OBLIGATIONS
Each and every obligation of Seller to consummate the transactions
contemplated by this Agreement or to be performed on the Closing shall be
subject to satisfaction, on Closing, of each of the following conditions,
unless waived or modified in writing by Seller:
7.1 Certificates. Buyer shall have furnished Seller with such
certificates of Buyer's officers as may be reasonably requested by Seller.
7.2 Corporate Documents. Seller shall have received from Buyer
resolutions certified by the Secretary of the Buyer as adopted by the Board
of Directors of Buyer approving this Agreement and the transactions
contemplated hereby.
7.3 No Injunction. There shall be no effective injunction, writ,
preliminary restraining order or any order of any nature issued by a court
of competent jurisdiction directing that the transactions provided for
herein, or any of them, not be consummated.
7.4 Waivers. Seller shall have received a waiver of its
obligations related to each of the (i) Employment Agreement, dated as of
May 14, 1998, as amended May 8, 2000, between Seller and Xxxxxx Xxxxxx and
(ii) letter agreement, dated October 1, 2000, between Seller and Xxxx
Xxxx-Xxxx.
ARTICLE VIII
CONDITIONS TO BUYER'S OBLIGATIONS
Each and every obligation of Buyer to consummate the transaction
contemplated by this Agreement or to be performed on the Closing shall be
subject to the satisfaction, on the Closing, of each of the following
conditions, unless waived or modified in writing by Buyer:
8.1 No Injunction. There shall be no effective injunction, writ,
preliminary restraining order or any order of any nature issued by a court
of competent jurisdiction directing that the transactions provided for
herein or any of them not be consummated.
8.2 Consents Obtained. All permits, waivers, releases, approvals
and consents set forth in Schedule 3.8 necessary for the consummation of
the transaction contemplated hereby and for the operation of the business
by Buyer, including without limitation all required third party consents to
the assignment of Assumed Contracts and Intellectual Property, shall have
been obtained.
8.3 Conveyancing Documents; Release of Encumbrances. Seller shall
have executed and delivered each of documents described in Section 2.3(a)
hereof so as to effect the transfer and assignment to Buyer of all rights,
title and interest in and to the Acquired Assets and Seller shall have
filed (where necessary) and delivered to Buyer all documents necessary to
release the Acquired Assets from all encumbrances, which documents shall be
in a form reasonably satisfactory to Buyer's counsel.
8.4 Certificates. Seller shall furnish Buyer with certificates as
may be reasonably requested by Buyer.
8.5 Corporate Documents. Buyer shall have received from Seller (i)
a good standing certificate from Seller's state of incorporation dated a
date not more than 10 days prior to the Closing; and (ii) resolutions
certified by the Secretary of the Seller as adopted by the Board of
Directors of Seller approving this Agreement and the transactions
contemplated hereby.
ARTICLE IX
SURVIVAL OF REPRESENTATIONS
AND WARRANTIES; INDEMNIFICATION
9.1 Survival of Representations and Warranties. The
representations, warranties, covenants and agreements of Seller and Buyer,
as the case may be, contained in this Agreement (including its schedules
and exhibits) shall survive the consummation of the transactions
contemplated hereby and the Closing Date, without regard to any
investigation made by any of the parties hereto. All such representations,
warranties, covenants and agreements and all claims and causes of action
with respect thereto shall terminate upon expiration of a period of twelve
(12) months beginning from the Closing Date, except for those
representations and warranties and claims and causes of action relating to
tax or ERISA matters, which shall terminate upon the expiration of the
applicable tax or ERISA statute of limitations. The termination of the
representations and warranties provided herein shall not affect the rights
of a party in respect of any claim made by such party in a writing received
by the other party prior to the expiration of the applicable survival
period provided herein.
9.2 Indemnifications.
(a) By Seller. Seller shall indemnify, save and hold
harmless Buyer, its affiliates and subsidiaries, and its and their
respective representatives, from and against any and all costs, losses,
taxes, liabilities, obligations, damages, lawsuits, deficiencies, claims,
demands, and expenses (herein "Damages"), incurred in connection with,
arising out of, resulting from or incident to (i) any material breach of
any representation, warranty or the material inaccuracy of any
representation, made by Seller in or pursuant to this Agreement; (ii) any
material breach of any covenant or agreement made by Seller in or pursuant
to this Agreement; (iii) any event or condition existing on or prior to the
Closing Date in connection with any of the Acquired Assets; (iv) any bulk
sales tax acts; and (v) those liabilities of Seller that are not Assumed
Liabilities.
(b) By Buyer. Buyer shall indemnify, save and hold harmless
Seller from and against any and all Damages incurred in connection with,
arising out of, resulting from or incident to (i) any breach of any
representation or warranty or the inaccuracy of any representation, made by
Buyer in or pursuant to this Agreement; or (ii) any breach of any covenant
or agreement made by Buyer in or pursuant to this Agreement; (iii) any
event or condition existing after the Closing Date in connection with any
of the Acquired Assets; and (iv) the Assumed Liabilities.
(c) All claims for indemnification must be asserted within
twelve (12) months from the Closing Date, or in the case of an
indemnification claim relating to a representation or warranty relating to
tax or ERISA matters, before the expiration of the applicable tax or ERISA
statute of limitations.
ARTICLE X
DEFINITIONS
10.1 Definitions. For all purposes of this Agreement, except as
otherwise expressly provided or unless the context otherwise requires:
(i) "Assigned Claims" shall mean all claims of Seller
against suppliers and processors with respect to the Inventory and the
other Acquired Assets.
(ii) "Code" means the Internal Revenue Code of 1986, as
amended.
(iii) "Contract" means any agreement, contract, note, loan,
personal property lease, evidence of indebtedness, purchase agreement,
order, letter of credit, franchise agreement, undertaking, covenant not to
compete, employment agreement, license, instrument, obligation or
commitment to which Seller is or may become a party or is or may become
bound and which relates to the Business or the Acquired Assets, whether
oral or written.
(iv) [Intentionally Omitted].
(v) "Intellectual Property" shall mean (a) the names "The
Xxxxxx-Xxxxxxxx Group Ltd." and "Xxxxxx-Xxxxxxxx", and logos listed on
Schedule 10-A hereto (the "Assigned Marks") and all associated goodwill
symbolized thereby or connected therewith, and all registrations and
applications with respect thereto, as well as all rights corresponding
thereto throughout the world; (b) copyrights, patents, designs, archives,
art work, screens, samples, design patents, design registrations, get-up,
trade dress and common law rights (including trade secrets, specifications
and know-how) relating to the Business, all of which are described on
Schedule 10-B hereto and (c) all goodwill appurtenant to any of the
foregoing.
(vi) "Inventory" shall mean all inventory owned by Seller
that relates to the Business, including all finished inventory, work in
process, raw materials, greige goods, inventory at outside processors,
supplies, and inventory in transit existing as of the date hereof.
(vii) "Other Inventory" means all Inventory of the Company
which is not Inventory.
(viii) "Tax or Taxes" shall mean all federal, state, local,
foreign and other taxes, assessments or other governmental charges,
including, without limitation, interest, penalties and additions in
connection therewith.
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.1 Waiver of Compliance. Any failure of Seller, on the one hand,
or Buyer, on the other, to comply with any obligation, covenant, agreement
or condition herein may be expressly waived in writing by the Buyer or the
Seller, respectively, but such waiver or failure to insist upon strict
compliance with such obligation, covenant, agreement or condition shall not
operate as a waiver of, or estoppel with respect to, any subsequent or
other failure.
11.2 Expenses: Transfer Taxes, Etc. Whether or not the transaction
contemplated by this Agreement shall be consummated and except as otherwise
provided for in this Agreement, each of the parties agrees that all of the
fees and expenses incurred by it shall be borne by it including, without
limitation, all fees of counsel, actuaries and accountants. Buyer shall be
responsible for and pay when due any sales or transfer taxes or other
similar taxes imposed by reason of the transfer of the Acquired Assets.
11.3 Notices. All notices, requests, demands and other
communications required or permitted hereunder shall be in writing and
shall be deemed to have been duly given if delivered by hand, mailed,
certified or registered mail with postage prepaid or by overnight delivery
by a nationally recognizable delivery service:
(a) If to Seller, to:
Consoltex Inc.
0000 Xxxxxxxxxxxxx Xxxxxxx
Xx. Xxxxxxx, Xxxxxx
Xxxxxx X0X 0X0
Attn: Xxxx Xxxxxxxx
with a copy to:
Xxxxxxxx Xxxxx & Deutsch LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Fax: (000) 000-0000
Attn: Xxxxxxx X. Xxxxxxxxxx, Esq.
or such other person or address as Seller shall furnish to Buyer in writing.
(b) If to Buyer, to:
Naplak Nomis, Inc.
x/x Xxxxxx-Xxxxx, Xxx.000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
Attn: Xxxxxx Xxxxxx
with a copy to:
Xxxx & Xxxxxxxxxxx
Xxx Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
Attn: Xxxx X. Xxxx
or to such other person or address as Buyer shall furnish to Seller in
writing. Notices shall be deemed given upon receipt.
11.4 Publicity. Prior to the Closing Date, neither Seller nor
Buyer shall make or issue, or cause to be made or issued, any announcement
or written statement concerning this Agreement or the transactions
contemplated hereby for dissemination to the general public without the
prior consent of the other party.
11.5 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without
regard to its conflicts of law doctrine.
11.6 Counterparts. This Agreement may be executed simultaneously
in two or more counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.
11.7 Headings. The headings of the Sections and Articles of this
Agreement are inserted for convenience only and shall not constitute a part
hereof or affect in any way the meaning or interpretation of this
Agreement.
11.8 Entire Agreement. This Agreement, including the Exhibits and
Schedules hereto, the Schedules and all documents required to be delivered
thereto and the other documents and certificates delivered pursuant to the
terms hereof, set forth the entire agreement and understanding of the
parties hereto in respect of the subject matter contained herein, and
supersede all prior negotiations, understandings, discussions, agreements,
promises, covenants, arrangements, communications, representations or
warranties, whether oral or written, by any officer, employee or
representative of any party hereto whether written or oral.
11.9 Third Parties. Except as specifically set forth or referred
to herein, nothing herein expressed or implied is intended or shall be
construed to confer upon or give to any person or corporation other than
the parties hereto and their successors or assigns, any rights or remedies
under or by reason of this Agreement.
11.10 Assignment. This Agreement shall not be assigned except with
the written consent of the other party; provided that Buyer shall be
entitled to assign this Agreement to a wholly-owned subsidiary. This
Agreement and all of the provisions hereof shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
assigns.
SIGNATURE PAGE FOLLOWS
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Asset Purchase Agreement as of the date first above written.
NAPLAK NOMIS, INC.
By: /s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
---------------------------------
Title: President
THE XXXXXX-XXXXXXXX GROUP LTD.
By: /s/ Xxxx X. Xxxxxxxx
Name: Xxxx X. Xxxxxxxx
---------------------------------
Title: Vice President,
Strategic Planning
