Exhibit 4
PURCHASE AND SALE AGREEMENT
THIS AGREEMENT made this 14th day of August, 1996, by and between QUANTUM
CHEMICAL CORPORATION, a Virginia corporation having its principal offices at
00000 Xxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxx 00000 ("Quantum"), and FIX-CORP
INTERNATIONAL, INC., an Ohio Corporation, having its principal offices at 00000
Xxxxx Xxxx, Xxxxx 000, Xxxxxxxxx, XX 00000 ("Buyer");
WITNESSETH:
WHEREAS, Quantum owns and has operated facilities at
Heath, Ohio, for the recycling of post consumer
polyethylene and other plastic resins; and,
WHEREAS, Quantum desires to sell such facilities and
portions of its post-consumer recycling business
associated therewith to Buyer; and
WHEREAS, Buyer desires to purchase such facilities and
portions of the post-consumer recycling from Quantum
upon the terms and conditions set forth in this
Agreement.
NOW, THEREFORE, in consideration of the mutual agreements set forth in this
Agreement, the parties hereto do hereby agree as follows:
1. ASSETS TO BE ACQUIRED. Subject to the terms and conditions set
forth in this Agreement, at Closing (as later defined) Quantum agrees to sell,
convey, transfer, assign and deliver to Buyer and Buyer agrees to purchase and
accept, as hereinafter provided, the following assets, rights and property (i)
constituting Quantum's Resource Recovery plant at Heath. Ohio and (ii) relating
to portions of Quantum's post-consumer plastic recycling business (collectively
referred to as the "Assets").
1.01. A parcel of land and all buildings and improvements upon it (the
"Premises") as described more full described in Schedule 1.01A, subject to the
reservations, easements, and
exceptions set forth in Schedule 1.01B and the existing or potential claims,
litigation, suits, charges, actions, governmental investigations or other
proceedings set forth in Schedule 5.08.
1.02. Personal property consisting of two parallel plastics recycling
lines (known as Line 7 and Line 8) composed of three primary processing areas
(dry processing, wet processing and finishing); bulk blending; truck scale;
office and shipping facilities; and other machinery and equipment. A listing of
the machinery and equipment for Line 7 and Line 8, plant support and obsolete
machinery and equipment to be sold and purchased is set forth in Schedule 1.02A.
Those assets attributable to that portion of Quantum's post consumer plastics
recycling business which is to be acquired by Buyer are set forth in Schedule
1.02B. Notwithstanding those items set forth on Schedule 1.02A, it is the
intention of the parties that all personal property, fixtures, equipment and
improvements located in the facility as of August 12, 1996 shall be included in
the personal property being sold to Buyer as set forth in Schedule 1.02A and
1.02B.
1.03. Buyer shall not purchase or acquire from Quantum pursuant to this
Agreement:
(a) Quantum's accounts receivable or notes receivable attributable to
Quantum's post-consumer plastics recycling business;
(b) Any of Quantum's covered xxxxxx rail cars and vehicles not listed in
Schedule 1.02A;
(c) Any trade name of Quantum or any right to use any trade name of
Quantum;
(d) Any trademarks of Quantum or any right to use any trademarks of
Quantum;
(e) Any portion of Quantum's post consumer plastics recycling business
not set forth in Schedule 1.02B;
(C) Any finished goods inventories not located upon the Premises at
Closing;
(g) Any office equipment (including, but not limited to, personal
computers, Telephones and copy machines) located upon the Premises
at Closing and covered under master leases held by Quantum or owned
by Quantum which is not listed in Schedule 1.02A; and,
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(h) Any records or documents related to the operation of the Assets
which are not located on the Premises at Closing.
2. PURCHASE PRICE. Buyer shall pay to Quantum for the Assets a total
purchase price of THREE MILLION FOUR HUNDRED THOUSAND DOLLARS ($3,400,000.00)
(the "Purchase Price").
2.01. The parties have agreed to allocate the purchase price among the
Assets on the basis set forth in Schedule 2.01.
2.02. The Purchase Price shall be paid as follows:
(a) TWO HUNDRED FIFTY THOUSAND DOLLARS ($250,000.00) to be paid upon the
signing of this Agreement and to be held and administered in
accordance with the terms and conditions of this Agreement;
(b) THREE MILLION ONE HUNDRED FIFTY THOUSAND DOLLARS ($3,150,000.00) to
be paid at Closing;
2.03. The payment specified in Sections 2.02(a) shall be allocated as
follows:
(a) FIFTY THOUSAND DOLLARS ($50,000.00) shall be deemed to be a
non-refundable deposit, subject only to Section 2.03(c), required by
Quantum in order to remove sale of the facility from the market
pending the Closing of this transaction.
(b) TWO HUNDRED THOUSAND DOLLARS ($200,000.00) to be held in trust by
Quantum's attorney subject to release of Buyer's contingencies.
(c) In addition to the other terms and conditions set forth in this
agreement, the deposits referred to Section 2.03(a) and (b) above
shall be refunded to Buyer if Quantum fails to perform any of the
terms or provisions of this agreement and/or any representation of
Quantum as set forth in this agreement is not true or accurate.
3. CLOSING.
3.01. The consummation of the sale and acquisition of the Assets pursuant
to this Agreement ("Closing") shall take place at the offices of Quantum at
00000 Xxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxx, during normal banking hours, Eastern
Standard Time, at a mutually convenient
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and agreeable date and as soon as practical after Buyer has been satisfied with
respect to or has waived the due diligence contingencies set forth in Section
9.04, but in no event later than sixty-six (66) days after the execution of this
Agreement. In the event the transaction does not close within said sixty-six
(66) day period, subject to the conditions precedent set forth in this
Agreement, this Agreement shall terminate in accordance with Section 11.03 or
any other provision dealing with termination based up failure to release
contingencies.
3.02. At Closing Quantum will deliver to Buyer a general warranty deed in
the form of Exhibit A to this Agreement for the Plant, a xxxx of sale in the
form of Exhibit B to this Agreement for the remainder of the Assets and such
other documents as specified in Section 9 of this Agreement or as mutually
agreed by the parties or as reasonably required by Buyer.
3.03. At Closing Buyer will deliver to Quantum all documents to be
delivered by Buyer to Quantum pursuant to Article 10 of this Agreement.
3.04. All documents to be delivered at Closing by either party to the
other shall have been reviewed and approved by the parties and their respective
legal counsel prior to Closing and as a condition precedent to Closing, subject
to the sixty-six day limit for Closing in Section 3.01.
4. TAXES. ASSESSMENTS. UTILITIES. TRANSFER TAXES AND FEES
4.01. Real estate and personal property taxes ("Tax" or "Taxes") imposed
upon the Assets for tax year 1995 have been or will be paid by Quantum. Quantum
shall give to Buyer at Closing a credit to the Purchase Price sufficient for
that portion of the 1996 Taxes representing Quantum's proportionate ownership of
the Plant during tax year 1996.
4.02. Any other similar ad valorem tax, tax or any special assessment
imposed on the real or personal property of the Plant shall be prorated between
Quantum and Buyer on the basis of the portion of the assessment period falling
before and after Closing, respectively.
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4.03. The parties shall make all reasonable efforts to change the billing
for water, electricity, sewer, telephone and other utilities from Quantum to
Buyer as of the date of Closing. All charges for water, electricity, sewage,
telephone and other utilities for the billing period encompassing Closing shall
be prorated between Buyer and Quantum as of Closing.
4.04. Any payments by either party to the other pursuant to Sections 4.02
and 4.03, or the prorations therein prescribed, shall be made within ten (10)
business days after receipt of invoices from the payee.
4.05. Buyer will pay or reimburse Quantum for all taxes, fees or other
charges payable to any federal, state or local governmental entity, except taxes
on or measured by the net income of either party or taxes imposed upon Quantum
as a result of any gain on this transaction, as a result of the sale or transfer
of the assets and business pursuant to this Agreement or any documents executed,
filed or recorded in connection with this Agreement.
5. REPRESENTATIONS AND WARRANTIES OF QUANTUM
Quantum represents and warrants as follows:
5.01. Quantum is a corporation duly organized, validly existing and in
good standing under the laws of the Commonwealth of Virginia and is qualified
and in good standing as a foreign corporation in the State of Ohio.
5.02. Quantum has full corporate power and authority to make and perform
this Agreement and to transfer and vest in Buyer title to all of the Assets.
5.03. The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated by this Agreement by Quantum have
been or will have been, prior to Closing, duly authorized by all requisite
corporate action.
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5.04. The execution of this Agreement by Quantum and the performance of
its obligations under this Agreement will not violate any contract, mortgage,
indenture or similar agreement or restriction to which Quantum is a party or
constitute a default under any collective bargaining agreement or other
agreement to which Quantum is a party and which pertains to the Plant.
5.05. Quantum has and will convey to Buyer fee simple title to all of
the real estate and appurtenances set forth in Schedule 1.01 A free and clear
of all liens, encumbrances or other charges, except as disclosed in Schedule
1.01B with possession of the Premises and Assets to take place immediately
after Closing.
5.06. Quantum is the sole and exclusive title owner of all the personal
and other tangible property to be transferred to Buyer as set forth in Schedule
1.02A and Schedule 1.02B. Quantum shall transfer such assets to Buyer in the
same condition they were in on June 5, 1996, ordinary wear and tear excepted,
free and clear of all liens, encumbrances and/or claims by any other person or
entity except those listed on Schedule 5.08.
5.07. Quantum's facility is in compliance in all material respects with
all laws, regulations, ordinances, decrees and orders relating to health and
environmental controls, including but not limited to sprinkler system and
pollution control equipment relating to health and environmental controls.
5.08. Except with respect to the matters listed in Schedule 5.08 or to
which Quantum has given or shall give notice to Buyer in writing, there are (a)
no litigation, suits, charges, actions, findings, governmental investigations,
reports or orders or other proceedings of any kind or nature threatened or
pending against Quantum which would materially effect Quantum's right to convey
the real and personal property required by this Agreement. (Such governmental
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investigations and reports as referred to above shall include the Department of
Labor, OSHA and any EPA agency; the plant, facility and assets are not subject
to any contract or agreement with any labor union, organization or collective
bargaining agreement which would be subject to of materially effect transfer of
the assets as contemplated by this agreement; that none of the restrictions and
matters set forth in Schedule 1.01B, materially affect the use and operation of
the facility and assets), and (b) no administrative or judicial proceedings
arising under any federal, state or local law or provision relating to the
regulation of the discharge of materials into the environment or otherwise
relating to the protection of health and environment, whether initiated by a
third party or by Quantum, pending or, to the knowledge, information and belief
of Quantum, threatened against or relating to or involving the Premises or
Assets or the business to be sold to Buyer pursuant to this Agreement, or the
transaction contemplated by this Agreement.
5.09 EXCEPT AS OTHERWISE PROVIDED HEREIN, THERE ARE NO EXPRESS OR IMPLIED
WARRANTIES THAT APPLY TO THE TRANSACTIONS CONTEMPLATED HEREIN AND QUANTUM
SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTY OF MERCHANTABILITY AND ANY IMPLIED
WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE.
5.10 That the plant, facility and assets are not subject to any contract
or agreement with any labor union, organization or collective bargaining
agreement.
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5.11 That the plant, facility and assets are not subject to any employee
or employment contracts, employment benefit or retirement programs of any kind
or nature as such relate to this Agreement.
5.11A That Quantum's Resource Recovery plant located at Heath, Ohio when
shut down in October, 1995 was fully operational and would produce the goods
and/or products for which it was intended and which it has in the past produced
and sold and no modifications or changes to the equipment, plant and facility
have been made since October, 1995 which, to the best of Quantum's knowledge,
would prevent the facility from starting up and becoming operational. Further
that operation of the facility in its current condition which is consistent with
its operation in October, 1995 will not violate any Environmental statute,
regulation or order. Any previous additions or modifications to the plant and
facility by 3DM are not being warranted by Quantum as to their environmental
qualifications or acceptability.
5.12 All inventories, buildings, and fixed assets owned or leased by
Quantum located at the facility in Heath, Ohio are and will be adequately
insured against fire to the closing date and valid policies therefore are and
will be outstanding and duly in force and the premiums will be paid prior to the
closing date.
5.13 That Quantum will make available after Closing for a period of one
(1) year as time permits and with reasonable notice from Buyer, personnel to
consult with Buyer and to assist Buyer in re-starting the plant and equipment to
the extent that Quantum employs such personnel. Quantum will also make available
to Buyer any and all records, manuals, permits, drawings, blueprints,
specifications, etc. which deal with equipment specifications and operation,
overall operation of the facility and building layout, design and construction.
During the period of time from the Closing until 90 days thereafter, Buyer will
not be charged by Quantum for any expenses
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incurred by Quantum in sending its personnel to the facility to assist and
consult with the Buyer. Thereafter, Buyer will be responsible for paying Quantum
for expenses incurred by Quantum's personnel in travel to and from the facility.
6. REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants as follows:
6.01. Buyer is a corporation duly organized and validly existing under the
laws of the State of Ohio and is in good standing therewith.
6.02 Buyer has full corporate power and authority to make and perform
this Agreement and to acquire title to the Assets Buyer is purchasing under this
Agreement.
6.03. The execution, delivery and performance of this Agreement and the
documents contemplated by this Agreement due from Buyer at Closing have been or
will have been, prior to Closing, duly authorized by all requisite corporate
action.
6.04. Buyer will complete its due diligence (including, but not limited
to, physical inspection of the Premises, the personal property and machinery and
equipment) prior to Closing based upon the fact that Buyer is not fully aware of
the condition of the Premises and machinery and equipment, and does not have
sufficient knowledge and awareness of any potential claims which it may need to
assume or resolve.
7. SURVIVAL OF REPRESENTATIONS
The representations and warranties of Quantum and Buyer contained in this
Agreement shall survive Closing in accordance with the applicable statutes of
limitations.
8. COVENANTS AND AGREEMENTS
8.01. Except as provided elsewhere in this Agreement, Buyer shall assume
no liabilities of Quantum including, without limiting the foregoing, any
accounts payable relating to the
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Premises, the Assets and the portions of the business to be acquired or any
liability of Quantum arising from acts or events occurring prior to Closing.
8.02. Except as provided elsewhere in this Agreement, Quantum agrees to
defend, indemnify and hold harmless Buyer, its officers, directors and employees
against and in respect of any and all claims, losses, costs, expenses,
obligations and liabilities (including without limiting the foregoing, and
subject to the provisions of Section 8.05, below, costs and expenses of
litigation and reasonable attorneys' fees) to the extent they arise or result
from or relate to (i) any breach by Quantum of any of its representations,
warranties, guarantees, agreements, commitments or covenants in this Agreement,
(ii) the operations at or upon the Premises and Quantum's plastics recycling
business prior to Closing which shall include, but not be limited to, any
liability arising out of or associated with any product, goods or processes
sold, delivered or distributed by Quantum, or (iii) any obligation, debt or
liability which Quantum shall have agreed to pay, perform or discharge pursuant
to this Agreement and/or any undisclosed debt, liability or obligation which
occurred, arose or accrued prior to Closing. This Section 8.02 shall not apply
to nor include any and all claims, losses, costs, expenses, obligations and
liabilities related to environmental damage, contamination, pollution, toxic or
hazardous chemicals which claims, losses, costs, expenses, obligations and
liabilities are the subject matter of a separate environmental indemnification
agreement between the parties in the form of Exhibit C to this Agreement.
8.03. Buyer agrees to and does hereby indemnify, defend and hold Quantum,
its officers, directors and employees harmless against and in respect of any and
all claims, losses, costs, expenses, obligations and liabilities (including
without limiting the foregoing, and subject to the provisions of Section 8.05
hereof, costs and expenses of litigation and reasonable attorneys' fees)
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to the extent they arise or result from or relate to (i) any breach by Buyer of
any of its representations, warranties, guarantees, commitments or covenants in
this Agreement, (ii) the operations at or upon the Premises and Buyer's plastics
recycling business on and after Closing to the extent unrelated to the items set
forth in Section 8.02(iii) above, or (iii) any obligation, debt or liability
which Buyer shall have agreed to pay, perform or discharge pursuant to this
Agreement. This Section 8.02 shall not apply to nor include any and all claims,
losses, costs, expenses, obligations and liabilities related to environmental
damage, contamination, pollution, toxic or hazardous chemicals which claims,
losses, costs, expenses, obligations and liabilities are the subject matter of a
separate environmental indemnification agreement between the parties in the form
of Exhibit C to this Agreement.
8.04. The indemnification provided for in Sections 8.02 and 8.03 shall
include any and all claims of liability of any type or nature against the
Indemnitee (as this term is defined in Section 8.05, below), except for claims
of gross negligence or willful misconduct against the Indemnitee.
8.05. With respect to any claim for which indemnification is sought
pursuant to this Agreement, the party seeking indemnification ("Indemnitee")
shall promptly after knowledge of such claim, notify in writing the party from
whom indemnification is sought or is owed ("Indemnitor"), in as much detail as
is feasible, of the existence and nature of the claim. At its sole cost and
expense, and with counsel of its choosing, Indemnitor shall defend against any
claim of a third party and shall pay any resulting settlements, judgments or
decrees. Indemnitee must have taken reasonable steps to mitigate any damages
resulting from any such third party claim. In its notice to the Indemnitor,
Indemnitee must grant to Indemnitor the full power, authority and right on
Indemnitee's behalf to control the defense or settlement of any such claim, so
long as
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Indemnitor diligently prosecutes the defense of the claim or suit. Indemnitor
shall keep Indemnitee informed at all times as to the status of the claim, and
Indemnitee may, at its own election and expense, participate in the defense of
any such claim. Should the Indemnitor, after the Indemnitee has fulfilled its
obligations under this Section, fail to defend or to prosecute diligently the
defense of any claim of a third party, the Indemnitee, without waiving any
rights against the Indemnitor, may defend or settle any such claim and shall be
entitled to recover from the Indemnitor the amount of any settlement or judgment
or decree and all costs and expenses, including, without limitation, reasonable
attorneys' fees. Each of the parties to this Agreement shall extend reasonable
cooperation to the other parties in connection with such defense or settlement.
The right of the Indemnitor to defend against any such claim shall be limited by
the right of an insurance company to defend against the claim if the claim
involves an insured risk.
8.06. After Closing Quantum shall give Buyer, its counsel, accountants,
engineers and other representatives access to the Assets' operational records,
including customer lists, which had been stored and/or were available prior to
Closing either at the adjacent compounding plant or off site of the Plant.
Access to such records shall be granted at reasonable times during the regular
daytime work hours of the facility or facilities in which the records and
documents are stored. Representatives of Buyer inspecting these records and
documents must upon request of Quantum execute confidentiality agreements and
must comply with the safety and security regulations of the facility in which
such inspections are made. Quantum shall have the right to have representatives
present at all times during such inspections. Buyer shall have the right to make
copies of such records and documents and shall reimburse Quantum for its costs
in making any such copies.
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8.07. Buyer recognizes that Quantum has shared operations and operating
systems between the Premises and the adjacent compounding plant. Buyer will
grant access to the Premises to Quantum, its employees, agents and contractors
for the purpose of utilizing, repairing, replacing, maintaining or disconnecting
shared operations and operating systems for which Quantum shall be financially
responsible. With respect to the shared operations or operating systems, Quantum
and Buyer agree that:
(a) Within twelve (12) months after Closing, Quantum shall disconnect
its adjacent compounding plant from the Premises' fire pump system
at Quantum's sole expense;
(b) Buyer shall grant to Quantum an easement, in the form of Exhibit D
to this Agreement, for the purpose of ingress and egress to and
utilization of the truck scale and the rail car unloading area;
(c) Quantum will maintain and repair the unloading ramps for the rail
car unloading area within the easement granted to it by Buyer at its
sole expense; and
(d) Buyer will maintain and repair the truck scale upon the Premises so
as to keep its operation in accordance with the standards of the
State of Ohio for certified scales at its sole expense.
8.08. Quantum shall lease to Buyer, in the form of Exhibit E to this
Agreement, sufficient linear footage for three (3) rail car spots on the
railroad spur located upon the premise of Quantum's adjacent compounding plant.
8.08A. This agreement is contingent upon Buyer's due diligence and
approval of Sections 8.07 and 8.08 above prior to Closing. Should Buyer after
completion of its due diligence find the provisions of Sections 8.07 and/or
8.08 to interfere with operation of the equipment, plant or facility or cause
excessive expense, the parties shall first endeavor to negotiate a resolution
thereof. If they cannot resolve their differences, then this agreement shall
terminate,
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Buyers full deposit shall be returned and each of the parties shall be released
from the terms and conditions of this agreement.
8.09. Without Quantum's prior approval, Buyer shall not accept any return
of products purchased by Quantum's post-consumer plastic resin customers from
Quantum. In the event any customer attempts to return product or notifies Buyer
that it intends to return product sold by Quantum, Buyer shall immediately
notify Quantum and shall inform Quantum of any reasons stated by a customer for
the return of product. Quantum shall then deal directly with the customer
concerning such return of product and any credits or refund associated therewith
and shall defend, save harmless and indemnify Buyer in regard to any matters
associated therewith.
8.10. Buyer shall not use "Quantum", "Quantum Chemical" or any other
similar name for the Premises or the business operated at the Premises which
might create the false or erroneous appearance or impression that the Premises
is owned or operated by Quantum after the Closing without specific written
consent from Quantum, although Buyer shall be entitled to retain as its own and
use the telephone number(s) which Quantum used during its ownership of the
facility.
8.11. Quantum agrees to immediately cease any further attempts to market,
sell or dispose of the Assets and/or Premises to, and to solicit offers for the
purchase or transfer of the Assets and/or Premises from, any prospective third
party purchasers or transferee unless or until this Agreement is terminated.
8.12. For the period between the execution of this Agreement and Closing,
Buyer shall have the right to limited, escorted access to the Premises in order
to complete its due diligence and/or to show the Premises and machinery and
equipment to lenders, investors and employees and to determine how to operate
the facility and Buyer's obligation pursuant to this agreement is
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contingent upon completion of such due diligence to Buyer's satisfaction prior
to Closing. In no event will Buyer be permitted to operate the machinery or
equipment without Quantum's written consent and without a representative of
Quantum present or to make improvements, modifications or repairs to the
Premises or the machinery and equipment prior to Closing without Quantum's
written consent. Buyer shall make prior arrangements with Quantum's designee for
access to the Premises.
9. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE. The obligation
of Buyer to proceed with Closing are, at Buyer's option, subject to the
satisfaction, waiver or release of the following conditions on or before
Closing.
9.01. All of the representations and warranties made by Quantum in this
Agreement shall be true and correct as of the time of Closing.
9.02. Quantum shall have delivered to Buyer an opinion of Quantum's
counsel, dated as of Closing, to the effect that:
(a) Quantum is a corporation duly organized, validly existing and in
good standing under the laws of the Commonwealth of Virginia and is
qualified and in good standing as a foreign corporation in the State
of Ohio.
(b) All proceedings required by law or by the provisions of this
Agreement or by Quantum's certificate of incorporation or by-laws,
or any other document binding upon Quantum, to be taken by Quantum
in connection with the due consummation of the transactions
contemplated by this Agreement have been duly and validly taken.
(c) Quantum has complete and unrestricted power to sell, convey,
transfer, assign and deliver to Buyer all of the assets to be sold
by Quantum to Buyer under this Agreement.
(d) The sale, conveyances, transfers, and deliveries under this
Agreement to Buyer are not in contravention of any applicable
federal, state or local law, or of any contract, indenture or other
instrument or document to which Quantum is a party or is bound.
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9.03. The Assets and the intended use thereof are not or have not been
adversely affected in a material way by a casualty or other event, whether
insured or uninsured, between the date of this Agreement and Closing. If such a
casualty or other event occurs, Buyer shall have the option: (i) proceed with
Closing according to the terms of this Agreement, (ii) proceed with Closing
except that the Purchase Price shall be reduced by the dollar amount of the cost
of repair or replacement of the assets affected, providing the parties to this
Agreement can agree on said dollar amount, or (iii) terminate this Agreement, in
which event the parties shall have no further obligation under this Agreement
and Buyer's entire deposit as set forth in Section 2.02(a) shall be immediately
returned to Buyer. Buyer may elect course (ii) and then select course (i) or
(iii) in the event the parties are unable to agree on the cost of repair or
replacement. For purposes of this Section 9.03 only, "adversely affected in a
material way" shall mean an estimated cost of $250,000.00 or more.
9.03A. Buyer makes a good faith effort to complete its financing of this
transaction by obtaining a firm commitment from its lender or lenders within
sixty-six (66) days after the date this Agreement is executed. If Buyer does not
obtain a firm commitment for financing satisfactory to Buyer or if this
financing contingency is not waived and/or released by Buyer in writing prior to
Closing, then all but $50,000.00 of Buyer's deposit as described in Section
2.02(a) shall be promptly returned to Buyer and the parties shall each be
released from further liability on this Agreement and Quantum shall be entitled
to retain $50,000.00 of Buyer's deposit free and clear of any claim by Buyer.
9.04 Buyer's obligation to Close this transaction is further contingent
upon Buyer's completion of its due diligence within twenty one (21) days after
execution of this Agreement by all parties and further that the results of the
Buyer's due diligence is satisfactory to Buyer. Such
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due diligence shall include but not be limited to the following: (a) Buyer
verifying and being satisfied that the assets being purchased are sufficient to
currently startup and operate the facility and are of the quality represented;
(b) Buyer being satisfied that Quantum's shutting down of the shared operation
as described in Section 8.05 and those matters described in Sections 8.07 and
8.08 above will not interfere with Buyer's operation of the facility or cause
Buyer to incur additional expenses associated with the shut down and/or the
operation of its facility thereafter; (c) Buyer being satisfied that the
facility as shut down and when started up and operated after the Closing is in
conformance with all Environmental laws, statutes, regulations and orders and
has not been notified of any violation in regards thereto and all equipment
located in the facility used to comply with Environmental laws, statutes,
regulations and orders is operating and in good order and repair; (d) Buyer
being satisfied that the plant and facility can be operated and will manufacture
the products as represented by Quantum; (e) Buyer being satisfied that it will
be able to obtain assistance from Quantum in putting the plant and facility back
into operation; and (f) review of Quantum's financials relating to this
transaction as described on Schedule 5.08A. This contingency must be released in
writing by notice from the Buyer to Quantum within Twenty one (21) days after
execution of this Agreement as provided above, otherwise should Buyer fail to
release this contingency in writing, each of the parties' obligations pursuant
to this Agreement shall terminate and each shall be released therefrom with
Buyer's payment/deposit as described in Section 2.02(a) being returned to Buyer
within five (5) days thereafter.
10. CONDITIONS PRECEDENT TO QUANTUM'S OBLIGATION TO CLOSE. The
obligation of Quantum to proceed with Closing are, at Quantum's option, subject
to the satisfaction, waiver or release of the following conditions on or before
Closing.
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10.01. Quantum have received the consideration to be paid at or before
Closing by Buyer to Quantum pursuant to Sections 2.02(a) and 2.02(b).
10.02. Buyer shall have delivered to Quantum an opinion of Buyer's counsel
dated as of Closing, to the effect that:
(a) Buyer is a corporation duly organized and validly existing under the
laws of the State of Ohio and in good standing therewith.
(b) All proceedings required by law or by the provisions of this
Agreement or by Buyer's articles of organization or operating
agreement, or any other document binding upon Buyer, to be taken by
Buyer in connection with the due consummation of the transactions
contemplated by this Agreement have been duly and validly taken.
(c) Buyer has complete and unrestricted power to purchase and accept all
of the assets sold by Quantum to Buyer under this Agreement and the
specific power and authority to execute the promissory note and
mortgage contemplated by this Agreement.
(d) That the purchase and receipt of the Assets from Quantum are not in
contravention of any applicable federal, state or local law, or of
any contract, indenture or other instrument or document to which
Buyer is a party or is bound.
11. MISCELLANEOUS.
11.01. BROKER'S. Quantum and Buyer each represents to the other that it has
not retained any broker or finder and that no fee, commission or other
compensation is payable to any broker or finder in connection with the
transactions contemplated by this Agreement as a result of each one's respective
actions.
11.02. PUBLICITY. Buyer agrees that it will make no public statements,
press releases or announcements regarding this transaction until Closing. Should
the Buyer breach this provision, then Quantum shall have the right, at its sole
discretion, to retain the payment made pursuant to Section 2.02(a) and to
terminate this Agreement without recourse by Buyer.
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11.03. SURVIVAL OF TERMS. In the event this Agreement is terminated by
either party, Sections 8.02 (Quantum's Indemnification of Buyer), 8.03 (Buyer's
Indemnification of Quantum), 8.04 (Exceptions to Indemnification), 8.05 (Claims
for Indemnification) and 11.02 (Publicity) shall survive such termination and
shall be effective in accordance with their respective terms.
11.04. PARTIES. This Agreement shall inure to the benefit of and be binding
upon the parties to this Agreement and their respective successors and assigns.
11.05. ENTIRE AGREEMENT. This Agreement contains the full and complete
agreement between the parties with respect to the sale by Quantum and purchase
by Buyer of the assets which are the subject matter of this Agreement. This
Agreement may only be modified or amended by written instrument signed by both
parties.
11.06. NOTICES. All notices, requests, demands and other communications
either required or given under this Agreement shall be in writing and shall be
deemed to have been duly given on the date of delivery in person to the officers
named below or three (3) days after mailing by certified or registered mail,
postage prepaid, return receipt requested to the following address:
IF TO QUANTUM: IF TO BUYER:
Quantum Chemical Company Fix-Corp International, Inc.
00000 Xxxxxxxxx Xxxxx 00000 Xxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000
Attention: President Attention: President
or such other address or person as the parties may designate from time to time.
11.07. APPLICABLE LAW. This Agreement shall be construed and enforced in
accordance with the laws of the State of Ohio.
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11.08. SCHEDULES AND EXHIBITS. All schedules and exhibits referred to in
this Agreement are incorporated into and made a part of this Agreement.
11.09. BULK SALES. Quantum and Buyer agree that the Uniform Commercial Code
and other statutes relating to the bulk sale or transfer of property are not
applicable to the transactions contemplated by this Agreement.
11.10. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original. This Agreement and any
counterpart so executed shall be deemed to be one and the same instrument. It
shall not be necessary in making proof of this Agreement or any counterpart of
this Agreement to produce or account for any of the other counterparts.
11.11. INVALIDITY. In the event any provision is held invalid or
unenforceable, the Parties shall attempt to agree on a valid or enforceable
provision which shall be a reasonable substitute for such invalid or
unenforceable provision in light of the tenor of the Agreement and, on so
agreeing, shall incorporate such substitute provision into this Agreement.
11.12. EXPENSES. Except as the parties may otherwise agreed, the parties
shall bear their respective fees, costs and expenses in connection with the
transactions contemplated by this Agreement.
11.13. WAIVER. No waiver by any party, whether express or implied, of any
right under any provision of the Agreement shall constitute a waiver of such
party's right at any other time or a waiver of such party's rights under any
other provision of the Agreement unless it is made in writing and signed by the
President or a Vice President of the party waiving the condition. No failure by
any party to this Agreement to take any action with respect to any breach of the
Agreement or default by another party shall constitute a waiver of the former
party's right to
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enforce any provision of the Agreement or to take action with respect to such
breach or default or any subsequent breach or default by such other party.
11.14. SECTION HEADINGS. The section and subsection headings in this
Agreement are for convenience of reference only.
11.15. LIQUIDATED DAMAGES. In the event Buyer fails to consummate the
transaction for any reason other than the failure of the contingencies set forth
in this Agreement, Quantum will be entitled to retain as liquidated damages, in
lieu of any other damages, liabilities, cost or expenses incurred by Quantum and
in complete satisfaction of the Buyer's liabilities to Quantum on account of
such failure or action, Buyer's payment in the amount of TWO HUNDRED FIFTY
THOUSAND DOLLARS ($250,000.00) pursuant to Section 2.02(a).
11.16. TIME OF ESSENCE. The parties to this Agreement agree that time is of
the essence in the performance of duties and obligations required of or pursuant
to this Agreement.
11.17. RELEASE; TERMINATION. Upon execution of this Agreement, Quantum
hereby releases and discharges Buyer and Buyer's officers and directors from any
claims, demands or liabilities associated with Case No. A-96-2928 pending in the
Common Pleas Court of Xxxxxxxx County, Ohio. Furthermore, prior to the
completion of Closing, in the event that any legal action is commenced against
Buyer by any person or entity not a party to this transaction which has as a
basis for the claim alleged therein Buyer's proposed purchase of Quantum's
Heath, Ohio facility and/or any of the assets being set forth in this agreement,
then Buyer shall have the option of terminating this agreement and receiving an
immediate return of its payment/deposit made to Quantum as set forth in Section
2.02(a) above.
IN WITNESS WHEREOF, the parties to this Agreement have caused this
Agreement to be duly executed by their authorized representatives as of the day
and year first set forth above.
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QUANTUM CHEMICAL CORPORATION FIX-CORP INTERNATIONAL, INC.
[Signatures -See Page 24]
By: By:
---------------------------- -----------------------------
Attest: Attest:
----------------------- -------------------------
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IN WITNESS WHEREOF, the parties to this Agreement have caused this
Agreement to duly executed by their authorized representatives as of the day and
year first set forth above.
QUANTUM CHEMICAL CORPORATION FIX-CORP INTERNATIONAL, INC.
By: By:
---------------------------- -----------------------------
Attest: Attest:
----------------------- -------------------------
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