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EXHIBIT 2.1
EXECUTION VERSION
ASSET PURCHASE AGREEMENT
by and between
THE XXXXX FIELD COMPANY
as the "Buyer",
and
IGK INDUSTRIES, INC.
as the "Seller"
Dated: December 22, 1999
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TABLE OF CONTENTS
PAGE
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ARTICLE 1 DEFINITIONS.........................................................1
1.1 Defined Terms.......................................................1
1.2 Other Defined Terms.................................................3
ARTICLE 2 PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES..............3
2.1 Purchase and Sale of Assets.........................................3
2.2 Excluded Assets.....................................................4
2.3 Transfer of Title to the Assets.....................................4
2.4 Assumption of Certain Liabilities and Obligations...................4
2.5 Excluded Liabilities................................................5
ARTICLE 3 PURCHASE PRICE......................................................5
3.1 Purchase Price......................................................5
3.2 Payment of Purchase Price...........................................5
3.3 Allocation of Purchase Price........................................5
ARTICLE 4 CLOSING.............................................................5
4.1 Closing.............................................................5
4.2 Deliveries by Buyer at Closing......................................6
4.3 Deliveries by Seller at Closing.....................................6
ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF SELLER............................7
5.1 Organization; Authorization.........................................7
5.2 Consents and Approvals..............................................7
5.3 Title to Assets; Sufficiency of Assets..............................7
5.4 Real Property.......................................................8
5.5 Financial Statements................................................8
5.6 Contracts...........................................................8
5.7 Absence of Certain Changes or Events................................9
5.8 Intellectual Property...............................................9
5.9 Receivables.........................................................9
5.10 Compliance With Laws................................................9
5.11 Taxes...............................................................9
5.12 Environmental Laws..................................................9
5.13 Certain Regulatory Matters.........................................10
5.14 Employee Benefits..................................................10
5.15 No Brokers.........................................................10
5.16 Year 2000..........................................................10
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ARTICLE 6 REPRESENTATIONS AND WARRANTIES OF BUYER ...........................10
6.1 Authorization......................................................10
6.2 Consents and Approvals.............................................10
6.3 No Brokers.........................................................11
ARTICLE 7 ADDITIONAL AGREEMENTS OF SELLER AND BUYER .........................11
7.1 Further Assurances.................................................11
7.2 Contract Manufacturer(s)...........................................11
7.3 Employee Matters...................................................11
7.4 Name Change........................................................11
7.5 Accounts Receivable................................................11
ARTICLE 8 INDEMNIFICATION....................................................12
8.1 Survival of Representations; Limitations...........................12
8.2 Indemnification by Seller..........................................12
8.3 Indemnification by Buyer...........................................12
ARTICLE 9 MISCELLANEOUS......................................................12
9.1 Assignment.........................................................12
9.2 Notices............................................................12
9.3 Choice of Law......................................................13
9.4 Entire Agreement; Amendments and Waivers...........................13
9.5 Multiple Counterparts..............................................14
9.6 Expenses...........................................................14
9.7 Invalidity.........................................................14
9.8 Publicity..........................................................14
9.9 Cumulative Remedies................................................14
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ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement, dated as of December 22, 1999, is by and
between The Xxxxx Field Company, a Michigan corporation ("Buyer") and IGK
Industries, Inc., a Michigan corporation ("Seller").
BACKGROUND
A. Seller is the owner of certain assets used in the manufacture and
sale of custom printed circuit boards (collectively, the "Business").
B. Buyer desires to purchase from Seller and Seller desires to sell to
Buyer substantially all of the assets of Seller used in the Business as more
fully described herein and all on the terms and subject to the conditions set
forth in this Agreement.
AGREEMENTS
NOW THEREFORE, in consideration of the mutual covenants and promises
contained herein and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
1.1 Defined Terms. As used herein, the terms below shall have the
following meanings. Any of these terms, unless the context otherwise requires,
may be used in the singular or plural depending upon the reference.
"Business" shall have the meaning set forth in paragraph A
above.
"Contract" shall mean any of the agreements, contracts,
leases, purchase orders, letters of credit, undertakings, covenants not to
compete, licenses, instruments, obligations, commitments, policies, quotations
and other executory commitments to which Seller is a party with respect to the
Business, which any of the Acquired Assets are subject or which are necessary to
operate the Business, whether oral or written, express or implied.
"Damages" shall mean any and all costs, losses, liabilities,
damages, claims and expenses, including reasonable attorneys' fees.
"Encumbrances" shall mean any claim, lien, pledge, option,
charge, security interest, deed of trust, restriction, conditional sales
agreement, encumbrance or other rights of third parties, whether voluntarily
incurred or arising by operation of law, and includes, without limitation, any
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agreement to give any of the foregoing in the future, and any contingent sale or
other title retention agreement or lease in the nature thereof.
"Environmental Laws" shall mean any and all federal, state or
local laws relating to environmental pollution, contamination or other
impairment, any hazardous or other toxic substances, whether liquid, solid
and/or gaseous, including smoke, vapor, fumes, soot, acids, alkalis, chemicals,
wastes, by-products, products, and recycled materials, which shall include, but
not be limited to, the Federal Solid Waste Disposal Act, the Federal Clean Air
Act, the Federal Clean Water Act, the Federal Resource Conservation and Recovery
Act of 1976, the Federal Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, the Federal Toxic Substance Control Act,
regulations, ordinances, codes, rules, policies, guidelines and other
governmental restrictions and requirements of the Environmental Protection
Agency, state governmental authorities, and local governmental authorities.
"Intellectual Property" shall mean all intellectual property
relating to the Business, including all (a) patents, patent applications and
patent rights to inventions, patent and/or technology licenses and immunity from
suit agreements between Seller and third parties, (b) drawings, processes,
products, apparatus, formulae, packaging rights, trade secrets, know-how,
discoveries, together with all reissuances, continuations, revisions, extensions
and examinations thereof, technology, inventions and conceptions of inventions
and technologies or processes under development and design, blueprints,
manufacturing, engineering and other technical information, and all related
notebooks, records, reports and data, (c) trademarks, trade names, service
marks, and copyrights and registrations and applications therefor, (d) the
goodwill associated with registered and non-registered trademarks and service
marks, (e) all software, software documentation, software licenses and mask
works, and (f) any rights as Seller may have to xxx for infringement of or
interference with the Intellectual Property.
"Material Adverse Effect" shall mean a material adverse effect
on the financial condition, business, earnings, results of operations, assets,
liabilities, or operations of the Business.
"Permits" shall mean all franchises, licenses, permits,
consents, rights, applications, filings, registrations, orders, approvals,
waivers, notices, declarations and other governmental authorizations.
"Person" shall mean any individual, corporation (including any
non-profit corporation), general or limited partnership, limited liability
company, joint venture, estate, trust, association, labor union or other entity
or governmental body.
"Receivables" shall be defined as in the Michigan Uniform
Commercial Code; provided, however, Receivables shall not include Receivables
due Seller from Interface Systems, Inc.
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"Related Agreements" shall mean all agreements entered into in
connection with this Agreement, including the Xxxx of Sale, Assumption
Agreement, and the Note (as hereinafter defined).
1.2 Other Defined Terms. In addition to the terms defined in the
Background Section to this Agreement and Section 1.1 hereof, the following terms
shall have the meanings defined for such terms in the Sections set forth below:
Term Section
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Acquired Assets.................................................... 2.1
Assumed Liabilities................................................ 2.5
Closing............................................................ 4.1
Closing Date....................................................... 4.1
Excluded Assets.................................................... 2.2
Excluded Liabilities............................................... 2.5
Financial Statements............................................... 5.5
Real Property...................................................... 2.1
ARTICLE 2
PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES
2.1 Purchase and Sale of Assets. Subject to the terms and conditions
contained herein, at the Closing, Seller will cause Interface Systems, Inc. to
sell, convey, transfer, assign and deliver to L & D Capital Holdings, L.L.C., a
Michigan limited liability company and an affiliate of Buyer ("L & D"), and L &
D will purchase and accept from Interface Systems, Inc., the real property
located at 0000 Xxxxxxx Xxxx, Xxx Xxxxx, Xxxxxxxx 00000, and the building and
all fixtures, easements, rights of way and improvements thereon (the "Real
Property") and all of Seller's right, title and interest in and to the following
assets, properties and rights which are used in the conduct of the Business,
free and clear of all Encumbrances (the "Acquired Assets"):
(a) cash balances, cash equivalents and investment accounts of
Seller, including amounts held on deposit in all savings, checkings, and money
market accounts, as listed on Schedule 2.1(a);
(b) all prepayments, accounts receivable, chattel paper (other
than "intercompany receivables" due from Interface Systems, Inc.) and other
items of a similar nature;
(c) all right, title and interest of Seller in the Contracts;
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(d) all tangible personal property, including, without
limitation, inventory (including raw materials, work in process, finished goods
and similar items), manufactured and purchased parts, machinery, furniture,
equipment, tools, office furnishings and supplies;
(e) all right, title and interest of Seller in the
Intellectual Property;
(f) all records or lists pertaining to Seller's customers,
suppliers, advertisers, promotional materials, sales, service, delivery,
employees and/or operations;
(g) all right, title and interest of Seller in any Permits;
and
(h) the name "IGK Industries, Inc." or any combination or
variation of such name.
2.2 Excluded Assets. There shall be excluded from the Acquired Assets
and Seller shall retain all assets not expressly set forth in Section 2.1 (the
"Excluded Assets"), including without limitation, the following:
(a) minute books, stock records, tax returns, and similar
corporate records of Seller; and
(b) the assets, properties or rights set forth on Schedule
2.2(b).
2.3 Transfer of Title to the Assets.
(a) Seller will sell, assign, convey, transfer and deliver the
Acquired Assets to Buyer at the Closing by means of deeds, bills of sale,
assignments, endorsements and certificates, and such other instruments of
transfer and conveyance as will be necessary or appropriate to vest good and
marketable title to the Acquired Assets in Buyer, free and clear of any
Encumbrances.
(b) Seller will pay title insurance costs and any and all
transfer taxes or similar duties, fees, etc. in connection with the transfer
described in Section 2.3(a) (including any and all real estate transfer taxes in
connection with the transfer of the Real Property).
(c) Buyer will pay any and all recording fees in connection
with the transfer of the Real Property.
2.4 Assumption of Certain Liabilities and Obligations. Subject to the
terms and conditions contained herein, Buyer will not assume any liabilities or
obligations of Seller, except those liabilities and obligations under the
Contracts arising on and after the Closing Date and all current liabilities,
including accounts payable and accrued expenses, existing on and after the
Closing Date (the "Assumed Liabilities"). The assumption by Buyer of the Assumed
Liabilities and the transfer thereof by Seller, shall in no way expand the
rights or remedies of any third party against Buyer as compared to the rights
and remedies which such third party would have had against Seller
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had Buyer not assumed such liabilities. Without limiting the generality of the
preceding sentence, the assumption by Buyer of the Assumed Liabilities shall not
create any third party beneficiary rights.
2.5 Excluded Liabilities. Subject to Section 8.1, and except to the
extent of the Assumed Liabilities, Seller will, without any responsibility or
liability of, or recourse to Buyer absolutely and irrevocably retain and be
solely responsible for any and all liabilities and obligations of any kind or
nature, whether foreseen or unforeseen, known or unknown, existing or which may
arise in the future, fixed or contingent, matured or unmatured of Seller arising
out of the ownership, use or possession of the Acquired Assets, or the operation
or conduct of the Business, prior to the Closing Date (the "Excluded
Liabilities").
ARTICLE 3
PURCHASE PRICE
3.1 Purchase Price. Subject to the terms and conditions contained
herein, in consideration for the sale and transfer of the Acquired Assets
pursuant to Section 2.1(a) hereof, Buyer shall pay an aggregate purchase price
of One Million Four Hundred Fifty Thousand Dollars ($1,450,000) (the "Purchase
Price").
3.2 Payment of Purchase Price. At the Closing, Buyer shall pay to
Seller, an initial payment of One Million One Hundred Thousand Dollars
($1,100,000) (the "Initial Payment") by wire transfer to an account designated
by Seller. The balance of the Purchase Price shall be paid by Buyer in
accordance with the terms of the Note, the form of which is attached hereto as
Exhibit A.
3.3 Allocation of Purchase Price. Seller and Buyer agree to allocate
the Purchase Price among the Acquired Assets as set forth on Schedule 3.3.
Seller and Buyer will mutually agree to this allocation and the information
which will be reported on Form 8594, or on such other form or statement as may
be required by law. Seller and Buyer will adhere to such allocation for all
purposes required under applicable laws in any tax returns filed by them
subsequent to the Closing Date, including the determination by Seller of taxable
gain or loss on the sale of the Acquired Assets and the determination by Buyer
of its tax basis with respect to the Acquired Assets.
ARTICLE 4
CLOSING
4.1 Closing. Upon the terms set forth herein, the closing of the
transactions contemplated herein (the "Closing") shall be held at 2:00 p.m.
local time on December 22, 1999 (the "Closing Date") at the offices of Xxxxxx
Xxxxxxx PLLC, 000 Xxxx Xxxxxxxxxx Xxxxxxx, Xxxxx 000, Xxx
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Arbor, Michigan 48108, unless the parties hereto otherwise agree.
4.2 Deliveries by Buyer at Closing. As of the Closing Date, Buyer shall
make all of the following deliveries to Seller:
(a) Payment of Initial Payment Price. Buyer shall pay to
Seller the Initial Payment as provided in Section 3.2 hereof.
(b) Note. Buyer shall deliver a duly executed Note providing
for the payment of Three Hundred Fifty Thousand Dollars ($350,000) from Buyer to
Seller at an annual interest rate of 9.25% on $250,000 of the principal amount
in the form of Exhibit A (the "Note").
(c) Xxxx of Sale. Buyer shall deliver a duly executed
assignment and xxxx of sale providing for the transfer of the Acquired Assets to
Buyer in the form of Exhibit B (the "Xxxx of Sale").
(d) Assumption Agreement. Buyer shall deliver a duly executed
assumption agreement providing for the assumption by Buyer of the Assumed
Liabilities in the form of Exhibit C (the "Assumption Agreement").
(e) Subordination Agreement. Buyer shall deliver a duly
executed subordination agreement in the form of Exhibit E (the "Subordination
Agreement").
(f) Noncompetition Agreement. Buyer shall deliver a duly
executed noncompetition agreement in the form of Exhibit F (the "Noncompetition
Agreement").
(g) MESC. Buyer shall deliver a duly executed Form UA 1027.
(h) Commitment Letter. Buyer shall deliver a commitment letter
from Huntington Financial in form and substance satisfactory to the Seller.
4.3 Deliveries by Seller at Closing. As of the Closing Date, Seller
shall make all of the following deliveries to Buyer:
(a) Xxxx of Sale. Seller shall deliver a duly executed Xxxx of
Sale.
(b) Limited Warranty Deed. Seller shall deliver a duly
executed Limited Warranty Deed providing for the transfer of the Real Property
from Interface Systems, Inc. to Buyer in the form of Exhibit D (the "Limited
Warranty Deed").
(c) Other Assignment Agreements. Seller shall delivery duly
executed instruments of conveyance, transfer and assignment as may be required
to transfer to Buyer all of the
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Sellers' right, title and interest in the Acquired Assets, each in a form and
substance reasonably acceptable to Buyer.
(d) Assumption Agreement. Seller shall deliver a duly executed
Assumption Agreement.
(e) Subordination Agreement. Seller shall deliver a duly
executed Subordination Agreement.
(f) Noncompetition Agreement. Interface Systems, Inc. shall
deliver a duly executed Noncompetition Agreement.
(g) MESC. Seller shall deliver a duly executed Form UA 1027.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller hereby represents and warrants to Buyer that the following
representations and warranties are as of the date hereof true and correct:
5.1 Organization; Authorization. Seller is duly organized, validly
existing and in good standing under the laws of the State of Michigan and has
full corporate power and authority to conduct its business as it is presently
being conducted. Seller has all necessary corporate power and authority and has
taken all corporate action necessary to execute and deliver this Agreement and
the Related Agreements to which it is a party, to consummate the transactions
contemplated hereby and thereby and to perform its obligations hereunder and
thereunder. This Agreement and the Related Agreements have each been duly
executed and delivered by Seller and each is a legal, valid and binding
obligation of Seller, enforceable against it in accordance with their terms,
except as may be limited by (i) bankruptcy, insolvency, moratorium,
reorganization and other similar laws affecting creditors' rights generally and
(ii) the general principles of equity, regardless of whether asserted in a
proceeding in equity or at law.
5.2 Consents and Approvals. No notice to, declaration, filing or
registration with, or authorization, consent or approval of, or permit from, any
domestic or foreign governmental or regulatory body or authority, or any other
person or entity, is required to be made or obtained by Seller in connection
with the execution, delivery and performance of this Agreement and the
applicable Related Agreements and the consummation of the transactions
contemplated hereby and thereby.
5.3 Title to Assets; Sufficiency of Assets. Schedule 5.3 sets forth a
true, correct and complete list of all fixed assets as of November 30, 1999
material to the Business, including a
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description and the book value (net of historical purchase accounting
adjustments) net of accumulated depreciation on an aggregate basis with respect
to such fixed assets. Seller has good title to all of the Acquired Assets, free
and clear of all Encumbrances. The Acquired Assets include all assets material
to the Business as the Business was conducted immediately prior to the execution
of this Agreement.
5.4 Real Property. Except as set forth on Schedule 5.4, all buildings,
structures and improvements located on, fixtures contain in, and appurtenances
attached to the Real Property conform, in all material respects, to all
applicable federal, state and local laws, regulations and ordinances. Real
property taxes shall be prorated on a due date basis.
5.5 Financial Statements. Attached hereto as Schedule 5.5 are copies of
Seller's balance sheets at and income statements for fiscal year ended September
30, 1999 and for the months ended October 31 and November 30, 1999 (the
"Financial Statements"). The Financial Statements fairly and accurately present,
in all material respects, the financial position of Seller as of the respective
dates thereof and the results of operations for the periods then ended (subject
to normal year-end adjustments).
5.6 Contracts. Seller has delivered to Buyer a correct and complete
copy of each material Contract to which Seller is party with respect to the
Business and Real Property and has provided to Buyer a written summary of any
oral material Contracts to which Seller is a party with respect to the Business,
including:
(a) All loan agreements, indentures, mortgages and guaranties
by which the Assets are bound;
(b) All pledges, conditional sale or title retention
agreements, security agreements, equipment obligations, personal property leases
and lease purchase agreements relating to any of the Assets to which Seller is a
party or by which any of the Assets are bound;
(c) All independent contractor and consulting agreements and
noncompetition agreements;
(d) All material sales agreements, service agreements and
customer contracts to which Seller is a party relating to the Business;
(e) All agency, distributor, sales representative and similar
agreements to which Seller is a party; and
(f) All return policies and warranties relating to products or
services provided by Seller as the same are currently in effect.
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To the best knowledge of Seller, each such Contract is valid and binding and
Seller is not in default in any material respect.
5.7 Absence of Certain Changes or Events. Since November 30, 1999,
there has not been any: (a) change in the financial condition or results of
operations of the Business, other than any such changes that have not yet had
and could not reasonably be expected to have a Material Adverse Effect; (b)
sale, lease, assignment or transfer of any of the Acquired Assets, except in the
ordinary course of business consistent with past practice and not individually
or in the aggregate material to Seller; or (c) other event or condition of any
character that in any one case or in the aggregate has a Material Adverse
Effect, or any event or condition known to Seller that it is reasonable to
expect could, in any one case or in the aggregate, have a Material Adverse
Effect in the future.
5.8 Intellectual Property. Seller owns or possesses adequate licenses
or other rights to use all Intellectual Property currently used in the Business
and has taken all reasonably necessary or appropriate action to protect the
Intellectual Property. All such Intellectual Property are assignable to Buyer,
free and clear of any Encumbrances. Seller has not received notice that any
product, invention, or method used by Seller in the Business or the use by
Seller of the Intellectual Property Rights is interfering with, infringing upon
or otherwise violating the rights of any third party in or to such Intellectual
Property, and no proceedings have been instituted against or notices received by
Seller alleging that any product, invention, or method used by Seller in the
Business or Seller's use or proposed use of any Intellectual Property infringes
upon or otherwise violates any rights of a third party in or to such
Intellectual Property.
5.9 Receivables. The Receivables are the result of bona fide sales or
other transactions. Seller knows of no reason why the Receivables will not be
paid in full as they come due, except to the extent that a reserve against the
possible uncollectibility of the Receivables has been established and is
reflected on the Financial Statements.
5.10 Compliance With Laws. Seller is and has been in compliance in all
material respects with all laws, orders, regulations, rules, decrees and
ordinances affecting the Business or the Acquired Assets, except where such
noncompliance would not have a Material Adverse Effect.
5.11 Taxes. To the best knowledge of the Seller, Seller has filed all
tax returns it was required to file and has paid all taxes (including
unemployment insurance contributions, FICA, Medicare and penalties) required to
be paid prior to the Closing Date. Seller has received no notice of any tax
deficiency against it, nor has it executed any waiver of any statute of
limitations on the assessment or collection of any tax or executed or filed with
the Internal Revenue Service or any other taxing authority any agreement now in
effect extending the period for assessment or collection of any taxes, which in
any case could have a Material Adverse Effect. There are no tax liens upon,
pending against or, to the best knowledge of Seller, threatened against any
Assets.
5.12 Environmental Laws. Seller is and has been in compliance in all
material respects with all Environmental Laws. Seller has not received any
notice of any pending or threatened
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claims, investigations, administrative proceedings, litigation, regulatory
hearings or requests or demands for remedial or response actions or for
compensation alleging noncompliance with or violation of any Environmental Law
or seeking relief under any Environmental Law, against Seller. 5.13 Certain
Regulatory Matters. There are no proceedings, investigations pending or to
Seller's knowledge threatened before any domestic or foreign court or any
administrative, governmental or regulatory body (including without limitation
those in which any of the following matters is being considered) which could
reasonably be expected to have a Material Adverse Effect, nor has Seller
received written notice or inquiry from any such body.
5.14 Employee Benefits. Seller does not maintain or contribute to any
employee benefit plan or compensation arrangement, but expects to have a 401(k)
in place prior to January 1, 2000.
5.15 No Brokers. Seller has not and will not have nay obligation to pay
any finder's fee, brokerage commission or similar payment in connection with the
transactions contemplated hereby.
5.16 Year 2000. Seller is installing the Quick Books accounting package
and the Bacon Job Trac system. The Seller expects both Quick Books and Bacon Job
Trac to be operational by December 31, 1999.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby represents and warrants to Seller that the following
representations and warranties are true and correct:
6.1 Authorization. Buyer and L & D are duly organized, validly existing
and in good standing under the laws of the State of Michigan and each has full
corporate and limited liability company, as the case may be, power and authority
to execute and deliver this Agreement and the Related Agreements to which it is
a party, to consummate the transactions contemplated hereby and thereby and to
perform its obligations hereunder and thereunder, and no proceedings on the part
of Buyer or L & D are necessary to authorize this Agreement and the Related
Agreements and the transactions contemplated hereby and thereby. This Agreement
and the Related Agreements have each been duly executed and delivered by Buyer
and each is a legal, valid and binding obligation of Buyer and L & D,
enforceable against each of them in accordance with their terms, except as may
be limited by (i) bankruptcy, insolvency, moratorium, reorganization and other
similar laws affecting creditors' rights generally and (ii) the general
principles of equity, regardless of whether asserted in a proceeding in equity
or at law.
6.2 Consents and Approvals. No notice to, declaration, filing or
registration with, or authorization, consent or approval of, or permit from, any
domestic or foreign governmental or
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regulatory body or authority, or any other Person, is required to be made or
obtained by Buyer or L & D in connection with the execution, delivery and
performance of this Agreement and the applicable Related Agreements and the
consummation of the transactions contemplated hereby and thereby.
6.3 No Brokers. Buyer has not and will not have any obligation to pay
any finder's fee, brokerage commission or similar payment in connection with the
transactions contemplated hereby.
ARTICLE 7
ADDITIONAL AGREEMENTS OF SELLER AND BUYER
Seller and Buyer covenant and agree as follows:
7.1 Further Assurances. Upon the terms and subject to the conditions
contained herein, the parties agree, after the Closing, (i) to use all
reasonable efforts to take, or cause to be taken, all actions and to do, or
cause to be done, all things necessary, proper or advisable to consummate and
make effective the transactions contemplated by this Agreement, (ii) to execute
any documents, instruments or conveyances of any kind which may be reasonably
necessary or advisable to carry out any of the transactions contemplated
hereunder, and (iii) to cooperate with each other in connection with the
foregoing.
7.2 Contract Manufacturer(s). For a period of three years beginning on
the date hereof, Seller agrees to cause Interface Systems, Inc. to use its best
efforts to require contract manufacturer(s) of circuit boards to purchase
circuit boards from Buyer provided that the prices and quality of such circuit
boards are competitive with the industry standard.
7.3 Employee Matters. Buyer agrees to extend an offer of employment to
each employee of Seller. Each such offer of employment shall be for a job of a
similar nature to that being performed prior to such offer at the current base
rate of pay for such employee and with benefits under Seller's employee benefit
plans. Buyer shall assume all of Seller's employee benefit plans on and as of
January 1, 2000.
7.4 Name Change. Promptly after the Closing, Seller shall amend its
articles of incorporation to change its name to any name not similar to "IGK
Industries, Inc."
7.5 Accounts Receivable. After the Closing, Seller shall promptly
notify and transfer to Buyer any cash, checks or other property that Seller may
receive on or after the Closing Date which property belongs to Buyer.
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ARTICLE 8
INDEMNIFICATION
8.1 Survival of Representations; Limitations.
(a) All of the representations and warranties made by Seller
and Buyer in this Agreement or in any attachment, exhibit, schedule,
certificate, document or list delivered by any such party pursuant hereto shall
survive the Closing for a period of eighteen (18) months after the Closing.
(b) Notwithstanding anything herein to the contrary, Buyer
shall not be entitled to any indemnification pursuant to Section 8.2 unless and
until Damages exceed $75,000 (the "Damage Basket"), in which case Buyer shall be
entitled to indemnity for all Damages incurred by Buyer pursuant to Section 8.2.
8.2 Indemnification by Seller. Seller shall indemnify and hold harmless
Buyer and its successors and assigns from and against any and all Damages
incurred by Buyer arising out of or resulting from any breach of or inaccuracy
in any representation or warranty made by Seller or any breach of any covenant
of Seller set forth herein.
8.3 Indemnification by Buyer. Buyer shall indemnify and hold harmless
Seller and its successors and assigns from and against any and all Damages
incurred by Seller arising out of or resulting from any breach of or inaccuracy
in any representation or warranty made by Buyer or any breach of any covenant of
Buyer set forth herein.
ARTICLE 9
MISCELLANEOUS
9.1 Assignment. Neither this Agreement nor any of the rights or
obligations hereunder may be assigned by any party without the prior written
consent of the other party. Subject to the foregoing, this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
9.2 Notices. All notices, requests, demands and other communications
which are required or may be given under this Agreement shall be in writing and
shall be deemed to have been duly given when received if personally delivered;
when transmitted if transmitted by telecopy, electronic or digital transmission
method; the day after it is sent, if sent for next day delivery to a domestic
address by recognized overnight delivery service; and upon receipt, if sent by
certified or registered mail, return receipt requested. In each case notice
shall be sent to:
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If to Buyer, addressed to:
The Xxxxx Field Company
0000 Xxxxx Xxxxx Xxxxx
Xxxxxx, XX 00000
Attn: Xxxxx Field
Fax: (000) 000-0000
With a copy to:
Xxxxxxx Xxxx, Esq.
000 Xxxxx Xxxx Xxxxxx
Xxxxx 000
Xxx Xxxxx, XX 00000
Fax: (000) 000-0000
If to Seller, addressed to:
Interface Systems, Inc.
0000 Xxxxxxxxx Xxxxx
Xxx Xxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Fax: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxx PLLC
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxxxxx X. Xxxxxxxx
Fax: (000) 000-0000
or to such other place and with such other copies as any party may designate as
to itself by written notice to the others.
9.3 Choice of Law. This Agreement shall be construed, interpreted and
the rights of the parties determined in accordance with the internal laws of the
State of Michigan without reference to its choice of law provisions.
9.4 Entire Agreement; Amendments and Waivers. This Agreement, together
with all exhibits and schedules hereto, constitutes the entire agreement among
the parties pertaining to the subject matter hereof and supersedes all prior
agreements, understandings, negotiations and discussions, whether oral or
written, of the parties. This Agreement may not be amended except by
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an instrument in writing signed on behalf of each of the parties hereto. No
amendment, supplement, modification or waiver of this Agreement shall be binding
unless executed in writing by the party to be bound thereby. No waiver of any of
the provisions of this Agreement shall be deemed or shall constitute a waiver of
any other provision hereof (whether or not similar), nor shall such waiver
constitute a continuing waiver unless otherwise expressly provided.
9.5 Multiple Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
9.6 Expenses. Except as otherwise specified in this Agreement, each
party hereto shall pay its own legal, accounting, out-of-pocket and other
expenses incident to this Agreement and to any action taken by such party in
preparation for carrying this Agreement into effect whether or not the Closing
occurs.
9.7 Invalidity. In the event that any one or more of the provisions
contained in this Agreement or in any other instrument referred to herein,
shall, for any reason, be held to be invalid, illegal or unenforceable in any
respect, then to the maximum extent permitted by law, such invalidity,
illegality or unenforceability shall not affect any other provision of this
Agreement or any other such instrument.
9.8 Publicity. Buyer and Seller shall not, without the written approval
of the other, make any press release or other public announcement concerning, or
discuss with third parties the details (financial or otherwise) of the
transactions contemplated by this Agreement, except as and to the extent that
such parties shall be so obligated by law or regulation, in which case the other
shall be advised and such parties shall use their best efforts to cause a
mutually agreeable release or announcement to be issued.
9.9 Cumulative Remedies. All rights and remedies of either party hereto
are cumulative of each other and of every other right or remedy such party may
otherwise have at law or in equity, and the exercise of one or more rights or
remedies shall not prejudice or impair the concurrent or subsequent exercise of
other rights or remedies.
[BALANCE OF PAGE LEFT BLANK INTENTIONALLY]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed on their respective behalf, by their respective officers thereunto
duly authorized, all as of the day and year first above written.
BUYER:
THE XXXXX FIELD COMPANY
By: /s/ Xxxxx X. Field
------------------------------
Xxxxx X. Field, President
SELLER:
IGK INDUSTRIES, INC.
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Chief Financial Officer
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