Exhibit 99.2
Asset Purchase Agreement
This Agreement is made and entered into this 7th day of July, 2008, by and
among the entities listed in Exhibit B hereto, c/o Trans-Lux Multi-Media
Corporation, as agent, c/o 00 Xxxxx Xxxxxx, Xxxxxxx, XX 00000 (herein
collectively referred to as "Seller")
and
Storyteller Theaters Corporation
000 Xxxxxxx Xxxxxx
Xxxxxxx Xxxxx, XX 00000
herein referred to as "Purchaser" and collectively with Seller, the "Parties."
Certain capitalized terms used in this Agreement are defined in Exhibit A.
Preamble
WHEREAS Seller is engaged in the business (the "Business"), as defined in
Exhibit A, Definitions.
WHEREAS Purchaser intends to acquire from Seller certain assets of the Business
by (i) purchasing and receiving by assignment and conveyance certain of Seller's
assets (ii) assuming certain of Seller's contractual relationships and
obligations pursuant to the terms of this Agreement and (iii) licensing certain
Intellectual Property from the ultimate parent of Seller, and Seller intends to
accept such sale and transfer and such assumption of contractual relationships
and obligations by Purchaser.
NOW THEREFORE, the Parties hereto agree as follows:
1. Current Status
Seller engages in the Business and uses tangible and intangible assets and
contractual relationships relating thereto.
2. Sale, License and Transfer of Assets
2.1 Seller shall sell and assign to Purchaser, subject to the terms and
conditions of this Agreement, all with effect from the Closing Date, all of its
right, title and interest to the following assets used in the Business as of the
Closing Date (collectively the "Acquired Assets"), and Purchaser hereby agrees
to accept such sale and assignment and purchase such Acquired Assets as set
forth below (the "Acquisition"). The Acquisition shall be given economic effect
as of the close of business at 11:59 pm Mountain Time on June 26, 2008 (the
"Economic Effective Date"). To implement such economic effect, the procedures
in Section 3.10 and Section 10 shall be followed.
2.1.1 the real property ("Facilities") located at each of the locations set
forth in Exhibit 2.1.1, including all fixtures and furnishings, including the
lease for the Santa Fe office facilities;
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2.1.2 the tangible personal property assets, including furniture, fixtures and
equipment, (collectively "Equipment") and other assets used in the Business, as
listed in Exhibit 2.1.2 including $10,000 held as xxxxx cash;
2.1.3 the Inventories of merchandise and supplies used in the Business listed in
Exhibit 2.1.3;
2.1.4 the pro-rata portion of the trade receivables listed in Exhibit 2.1.4
attributable to the periods following the Economic Effective Date (hereinafter
"Trade Receivables").
2.1.5 the trade names for each of the respective theatres set forth in Exhibit
2.1.5, and the goodwill of the business and telephone numbers and web sites of
the Business listed in Exhibit 2.1.5.
2.1.6 All Seller's rights in the trade-dress and appearance of the theatres used
in the Business, and all rights to the websites and domain names shown on
Exhibit 2.1.6, except that rights to the name "Trans-Lux" shall be subject to
the Trademark License Agreement described below.
2.1.7 the Assumed Contracts as provided in Section 3.1.
2.2 Subject to the terms and conditions of this Agreement, on the Closing Date,
Seller and its affiliate Trans-Lux Corporation shall license to Purchaser
certain trade names pursuant to the terms and conditions of the Trademark
License Agreement set forth in Exhibit 2.2 executed simultaneously herewith.
2.3 The following assets and other items set forth in this Section 2.3 are not
included in the Acquired Assets sold and assigned pursuant to this Agreement
(hereinafter the "Excluded Assets"):
(a) cash and cash equivalents of Seller on hand and in bank accounts and
other investment accounts, together with such accounts (except $10,000 xxxxx
cash as divided among the Theatres), with any excess refunded to Seller within
ten (10) days following the Closing.
(b) all rights throughout the world in and to the name Trans-Lux or TLX or
any variations thereof, and all trademarks and similar registrations (and
applications therefor) relating to the name of Trans-Lux Corporation, TLX or
Seller except the limited rights granted pursuant to Exhibit 2.2.
(c) the Assets listed on Exhibit 2.3(e), including personal artwork of
Xxxxxx Xxxxxx in the Santa Fe office, personal artwork and furniture of Xxxxxxx
Xxxxxx in the Los Angeles office and personal artwork, personal papers and
photographs of Xxxxxxx Xxxxxx in the Santa Fe office, none of which are listed
in Exhibit 2.1.2.
(d) Administrative Assets;
(e) litigation and other claims of the Seller arising prior to the Closing
and receivables therefrom, including those set forth on Exhibit 2.3(e);
(f) prepaid Taxes and rights to refunds of Taxes paid by Seller or its
Affiliates;
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(g) all assets not otherwise listed as an Acquired Asset in this Agreement.
2.4 The Acquired Assets have been examined by Purchaser or its representatives,
and, except as otherwise provided in this Agreement, are being sold "as is" and
"where at," and subject to existing mortgages and other security agreements, as
identified on Exhibit 3.7 and assumed pursuant to Sections 3.1 and 3.7.
2.5 The Acquired Assets to be sold and licensed pursuant to this Agreement
include all books, records and other documentation, including but not limited to
those provided during the due diligence conducted by Purchaser (hereafter
"Documentation") relating exclusively to the Business. If Purchaser requests
original Documentation during the three (3) year period following Closing in
connection with audit or other proceedings, then Purchaser shall notify Seller
and Seller shall provide such available originals to Purchaser. The Parties
agree that any books, records and other documentation relating exclusively to
Excluded Assets, or which don't relate exclusively to the Business, are neither
sold and transferred nor delivered to Purchaser and shall be retained by Seller,
but that Purchaser may have access pursuant to this Section 2.5 to retained
documents which pertain both to the Business and to other activities of Seller
("Mixed Documents"). To the extent original records are delivered to Purchaser,
Seller will be entitled from time to time to make copies at its own expense of
all books, records and other documents pertaining to the Business and included
in the Acquired Assets which Seller desires for Tax, accounting, legal or other
purposes and to receive the originals thereof if necessary for any such
purposes. Purchaser agrees to preserve and keep (by microfilm or otherwise) as
it deems appropriate all such books, records and other documents for a period of
at least six (6) years from the Closing Date. Purchaser shall give Seller 45
days written notice of its intention to dispose of such books, records and other
documents and provide Seller a reasonable opportunity to obtain possession or
make copies thereof at Seller's expense. Purchaser agrees to treat as
confidential and not disclose information in Mixed Documents which does not
pertain to the Business, pursuant to Section 11.1 below.
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2.6 Option to Purchase. During the six (6) month period following the Closing
Date, ("option exercise period"), time being of the essence, Purchaser shall
have the option to purchase the parcel of land in Silver City, New Mexico
described on Exhibit 2.6 for a cash purchase price of $920,000 based on Seller's
cost ($850,000) plus soft costs ($70,000). The option purchase price shall be
increased by Seller's out-of-pocket costs to construct and maintain road access
and related costs which Seller documents. The option shall be exercised by
Purchaser's written notice to Seller accompanied by Purchaser's authorized
signature on the Purchase and Sale Agreement (the "Silver City Agreement") in
the form annexed hereto as Exhibit 2.6 and made a part hereof, accompanied by
Purchaser's check in the amount of the Contract Deposit set forth therein to the
order of the Title Company designated in the Silver City Agreement. If the
option is duly exercised by Purchaser, Seller and Purchaser shall perform the
Silver City Agreement. The closing shall take place pursuant to the provisions
of the Silver City Agreement. If the option shall not be exercised by Purchaser
within the option exercise period, the option shall expire and be of no further
force or effect. At Purchaser's election, this option to purchase shall be
evidenced by a recordable instrument, and recorded at Purchaser's expense in the
real estate records of Grant County, New Mexico.
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3. Assumption of Contractual Relationships; Pro Ration
3.1 All contracts, purchase orders, offers, or projects in progress at the
Closing relating to the Business including the Theatre construction projects
listed in Exhibit 3.1 as of the Closing Date, except for the Excluded Contracts
set forth in Section 3.3, are assigned to and assumed by Purchaser (herein
"Assumed Contracts"). Without limiting the foregoing, Seller shall assign to
Purchaser all warranties and remedies under that certain Construction Contract
dated July 16, 2007 with Xxxxxxxx Construction Co. ("Contractor") and shall
obtain any consents required in connection with such assignments. At the
Closing, Purchaser shall assume from Seller all rights and obligations resulting
from these Assumed Contracts by way of the assumption of contract subject to any
required third party consent pursuant to Section 5 and to Section 3.9. A list
of the Assumed Contracts is attached as Exhibit 3.1.
(a) Purchaser shall assume all written vendor and supplier agreements and
purchase orders including agreements for warranties on inventory and or products
included in the Acquired Assets to the extent assignable for the period after
Closing (hereinafter "Assumed Vendor and Supply Contracts"). A list of the
Assumed Vendor and Supply Contracts is attached as Exhibit 3.1(a).
(b) At Closing Purchaser and Trans-Lux Corporation will enter into the
non-exclusive Equipment Maintenance Agreement pursuant to which Purchaser will
have the option, but not the obligation, to request parts and labor for signs
and message centers at the rates (most favored customer basis) set forth in
Exhibit 3.1(b).
3.2 The following contracts are not included in the Assumed Contracts or Assumed
Vendor and Supply Contracts.
3.2.1 all contracts set forth in Exhibit (3.2.1) to this Agreement (hereinafter
"Excluded Contracts").
3.3 To the extent that the Assumed Contracts constitute pending transactions or
Work in Process, it is expressly agreed that the amounts relating to periods
prior to the Closing, whether or not which Seller has been invoiced, for
construction costs, supplies, labor and other costs prior to Closing shall be
Seller's responsibility, and Retained Liabilities, except as otherwise agreed in
writing and set forth in Exhibit 3.3.
3.4 If, after the Closing Date, either Purchaser or Seller, as the case may be,
receives any amounts in part or in full to be paid under the Assumed Contracts
or the Excluded Contracts, as the case may be, which should, in accordance with
the terms of this Agreement and, in particular with this Section 3, have been
paid to the other Party, then the Party having received such amount shall
forward any such amount, which it has incorrectly received, to the other Party
within thirty (30) days.
3.5 Seller agrees to transfer and assign as of the Closing Date all warranty
claims against third parties under the Assumed Contracts. Purchaser hereby
accepts the assignments of such warranty claims.
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3.6 As of the Economic Effective Date, the Trade Receivables and the following
expenses attributable to the Business shall be allocated between and are hereby
assumed by Purchaser and Seller as follows:
(a) All state, county and local ad valorem Taxes on real or personal
property, and all utility charges shall be apportioned between Purchaser and
Seller as of 11:59 P.M. Mountain Time on the day immediately prior to the
Economic Effective Date. To the extent feasible, the Seller shall obtain
special meter readings, and, if not feasible, utility expenses shall be
pro-rated, computed on the basis of the fiscal year for which the same are
levied, and all utility charges, gas charges, electric charges, water charges,
water rents and sewer rents, if any, shall be apportioned between Purchaser and
Seller as of 11:59 P.M. Mountain Time on the day immediately prior to the
Economic Effective Date, computed on the basis of the most recent meter reading
or, in the case of annual charges, on the basis of the established fiscal year.
All prepaid expenses (including any rent) paid by Seller prior to the Economic
Effective Date in respect of the Business shall be apportioned between Purchaser
and Seller as of 11:59 P.M. Mountain Time on the Economic Effective Date
computed on the basis of the benefit received by Seller prior to the Economic
Effective Date and the benefit to be received by Purchaser after the Economic
Effective Date with respect to any contract or other matter to which the prepaid
expense relates. All other rent expenses, including common area charges and
other costs imposed by landlords, shall be pro-rated as of 11:59 P.M. Mountain
Time on the Economic Effective Date. All prorations shall be made and the
Purchase Price shall be adjusted insofar as feasible on the Closing Date.
During the six-month period after the Closing Date, Seller shall advise
Purchaser and Purchaser shall advise Seller of any actual changes to such
prorations, and the Purchase Price shall be increased or decreased, as
applicable, at the end of such six-month period. In the event Purchaser or
Seller shall receive bills after the Closing Date for expenses incurred prior to
the Closing Date that should have been but were not prorated in accordance with
this Section 3.6(a), then Purchaser or Seller, as the case may be, shall
promptly notify the other party as to the amount of the expense subject to
proration and the responsible party shall pay its portion of such expense (or,
in the event such expense has been paid on behalf of the responsible party,
reimburse the other party for its portion of such expenses). Further, to the
extent a portion of any pro-rated or apportioned amount was deducted to
calculate the Adjusted Operating Cash Flow paid to Purchaser pursuant to Section
3.10, such portion shall not also be due from Purchaser pursuant to this Section
3.6(a).
(b) Purchaser and Seller shall cooperate in preparing, executing and filing
use, sales, real estate, transfer and similar government-required Tax returns
relating to the purchase, sale and/or transfer of the Acquired Assets under this
Agreement. Purchaser, on the one hand, and Seller, on the other hand, shall
each pay 50% of all such Taxes, including any penalties, interest and additions
to Tax, incurred in connection with the purchase, sale and/or transfer of the
Acquired Assets. Such Tax returns shall be prepared in a manner that is
consistent with the determination of the allocation of the Purchase Price as
contemplated by Section 6.2. Seller shall notify Purchaser of the estimated
amount of such transfer Taxes prior to the Closing Date, and Purchaser shall pay
50% of such amount to Seller on the Closing Date, who in turn shall pay and
remit the same to the appropriate Governmental Entity. The estimated amount of
such transfer Taxes shall be revised to reflect the actual amounts due to
reflect amounts actually paid to taxing authorities. Seller will provide
documents to Purchaser evidencing payment in full of such transfer Taxes
promptly after payment thereof to the appropriate Governmental Entity, and will
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indemnify Purchaser for any failure to remit Purchaser's share of such transfer
Taxes after receipt of funds therefor from Purchaser. To the extent Purchaser's
share of transfer Taxes differs from the amount paid by Purchaser to Seller at
Closing, the appropriate amount shall be refunded to Purchaser, or an additional
payment shall be made by Purchaser, promptly after Seller provides evidence of
the amount of transfer Taxes actually paid.
(c) All Trade Receivables shall be apportioned between Purchaser and Seller
as of 11:59 P.M. Mountain Time on the Economic Effective Date. Seller shall
deliver to Purchaser its calculation of the portion of such Trade Receivables
allocable to Seller, and Purchaser shall confirm its agreement or disagreement
with such calculation. After such calculation is finally agreed, the Parties
shall designate it as Exhibit 3.6(c). To the extent such Trade Receivables are
actually earned and paid to any Party, the Party receiving such payment promptly
shall forward to the other Party its share of the payment received. The Parties
agree to cooperate in pursuing the collection of the Trade Receivables.
3.7 Purchaser will assume on and after the Closing and will perform and
discharge when due (i) liabilities and obligations for performance after the
Closing Date under Assumed Contracts and Assumed Supply Contracts, (ii)
liabilities and obligations relating to the Theatres with respect to periods on
and after Closing including liabilities and obligations relating to Seller's
deeds of trust and mortgages on the Theatre properties (the "Real Estate Loans")
and (iii) the normal accrued weekly or bi-weekly payroll for the period
preceding Closing Date except to the extent included in the reconciliation of
Theatre Business Cash Flow. Liabilities and obligations to be assumed by
Purchaser pursuant to this Section 3.7 are listed in Exhibit 3.7 (excluding
current portions of long term debt which payments are due on or before Closing)
are referred to herein as "Assumed Liabilities." Purchaser acknowledges that if
Seller pays any portion of any Assumed Liability which relates to a period after
the Economic Effective Date, Seller may include such payment as an expense in
the calculation of Theatre Business Cash Flow pursuant to Section 3.10. Seller
may also reduce the Theatre Business Cash Flow paid to Buyer by the entire
amount of principal payments on the Real Estate Loans made after the Economic
Effective Date.
3.8 Except as provided in Section 3.4 or Section 3.7 or pursuant to Section
10.1(b) or otherwise expressly agreed in writing, the parties agree that
Purchaser is not assuming any liabilities or obligations of Seller or the
Business as operated by Seller and accrued prior to the Closing. Liabilities
and obligations of Seller with respect to periods prior to the Closing (other
than Assumed Liabilities) are referred to herein as "Retained Liabilities".
Liabilities and obligations of the Business or the Acquired Assets accruing
after the Closing shall be the obligations and liabilities of Purchaser.
3.9 To the extent that any Assumed Contract or other Acquired Asset to be
transferred to Purchaser is not capable of being validly and fully assigned,
transferred, conveyed or reissued to Purchaser without a consent or approval,
and such consents and approvals have not been obtained prior to the Closing or
do not remain in full force and effect at or immediately after the Closing, no
such assignment, transfer, conveyance or reissuance shall be deemed to have
occurred until such consent or approval has been obtained, and Seller shall,
after the Closing, use its reasonable commercial efforts to: (i) obtain such
consents or approvals, (ii) cooperate in any lawful arrangement designed to
provide to Purchaser the benefits of any Assumed Contract or
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other Acquired Asset as to which such a consent or approval has not been so
obtained or does not remain in full force and effect, and (iii) enforce, at the
request of Purchaser and at Purchaser's expense, for the benefit of Purchaser,
any rights of Seller under or with respect to any such Assumed Contract or other
Acquired Asset against all other persons (including termination of the foregoing
in accordance with the terms thereof upon the election of Purchaser), provided
that Seller shall not be required to take any action pursuant to this sentence
that could reasonably be expected to result in Seller incurring liability to a
third party. To the extent that Purchaser is provided the benefits pursuant to
this Section 3.9 of any such Assumed Contract or other Acquired Asset, Purchaser
shall perform the liabilities and obligations of Seller thereunder or in
connection therewith with respect to periods following the Closing as if they
were Assumed Liabilities.
3.10 (a) From the Economic Effective Date until the Closing, Seller shall
operate the Business for the benefit of Purchaser, provided all material
agreements listed in Exhibit 3.10(a) are signed and delivered to First American
Title Company on July 7, 2008 including forms of employment agreements being
negotiated as of the date hereof between Purchaser and each of Xxxxxxx Xxxxxx
and Xxxxxx Xxxxxx.
(b) Provided the Closing occurs on or before July 15, 2008, the Theatre
Business Cash Flow for the period from the Economic Effective Date to the
Closing Date shall be transferred to Purchaser. For the purposes of this
Agreement, "Theatre Business Cash Flow" shall mean, for the applicable period
described below, the gross receipts from operation of the Business, less, in
each case consistent with past practice and the sample calculation of such
Theatre Business Cash Flow for 2007 attached as Exhibit 3.10(b), (i) normal
operating expenses, including but not limited to, payroll, benefits, rent,
utilities, insurance, licensing fees paid for movies exhibited, purchases of
inventory, interest expense on loans, (ii) normal operating expenses of the
local Santa Fe office, including but not limited to, payroll, benefits, rent and
utilities, (iii) normal operating expenses of the California office, including
but not limited to 100% of Xxxxxxx Xxxxxx payroll, benefits and travel, (iv)
normal operating expenses of Xxxxxx Xxxxxx, including but not limited to 100% of
payroll and benefits, (v) a portion of the consulting fee paid directly or
indirectly to Xxxxxxx Xxxxxx, and (vi) interest for such period on the Closing
Cash Payment at the rate due under that certain Amended and Restated Commercial
and Security Agreement dated December 23, 2004 with People's United Bank.
(c) If the Closing occurs after July 15, 2008 but occurs on or before July
30, 2008, one-half of the Theatre Business Cash Flow for the period from the
Economic Effective Date to the Closing Date shall be transferred to Purchaser.
(d) If the Closing occurs after July 30, 2008, one-half of the Theatre
Business Cash Flow for the two-week period preceding the Closing Date shall be
transferred to Purchaser.
(e) No later than sixty (60) days following Closing, Seller shall deliver
to Purchaser an accounting of Seller's determination of the Theatre Business
Cash Flow of the Business for the applicable period ending on the Closing Date.
The parties shall confer in good faith to resolve any adjustments proposed by
Purchaser to such determination of Theatre Business cash Flow and if unable to
resolve any disagreements shall engage the service of an office of RSM McGladrey
located in Arizona, Colorado, New Mexico or Wyoming (the "Independent
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Accountant") to resolve the dispute, provided that such local office shall not
have performed financial or accounting due diligence on behalf of Purchaser in
connection with the transactions contemplated herein. The fees and expenses of
the Independent Accountant shall be shared equally by Purchaser and Seller.
(f) The payment of Theatre Business Cash Flow due under this Section 3.10
shall be made within five business days after the earlier of (i) Purchaser's
confirmation it has accepted Seller's determination of Theatre Business Cash
Flow, (ii) agreement by Seller and Purchaser concerning the resolution of any
questions about such determination, or (iii) the resolution of any such
disagreements by the Independent Accountant.
4. Hiring of Key Employees
4.1 (a) Purchaser and Seller shall enter into an Employee Services Agreement in
the form of Exhibit C providing for Seller to continue to hire the employees
listed on Exhibit 4.1(b) for 60 days following the Closing, and for Purchaser to
reimburse Seller for all related expenses.
(b) Purchaser shall offer employment effective as of the termination of the
Employee Services Agreement to each employee of the Business all of whom are
listed on Exhibit 4.1(b). Any such employee who accepts Purchaser's offer of
employment shall be referred to herein as a "Purchaser Employee" and shall
resign from or be deemed to have resigned from Seller's employment as of the
termination date of the Employee Services Agreement. Nothing herein shall be
deemed to require Xxxxxxx Xxxxxx and/or Xxxxxx Xxxxxx to resign as directors of
Trans-Lux Corporation.
(c) Nothing in this Agreement shall limit Purchaser's right to terminate
the employment of any Purchaser Employee except as specifically provided in any
written agreement between such Purchaser Employee and Purchaser.
(d) Purchaser shall enter into employment agreements with the three persons
listed in Exhibit 4.1(d), drafts of which in the form proposed as of July 2,
2008 have been disclosed to Seller. Purchaser agrees not to alter the economic
terms of such employment agreements from the terms disclosed in such drafts
without Seller's written consent.
(e) Purchaser agrees to engage Seller to consult with Purchaser with
respect to the Business on a part time basis pursuant to the consulting
agreement attached hereto as Exhibit 4.1(e), such services to be performed by
Xxxxxxx Xxxxxx on Seller's behalf. Such agreement provides that Seller shall
have no liability for any such services except for claims based on Seller's
gross negligence or willful misconduct.
4.2 If Seller incurs WARN Act liabilities because 50 or more of the Business
employees are not Purchaser Employees, then Purchaser shall be liable for all
payments during the 60 days following termination of the Employee Services
Agreement for such employees under the WARN Act.
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5. Third Party Consents
5.1 The Parties will jointly endeavour to obtain all necessary third party
consents in respect of the transfer of the Acquired Assets and the Assumed
Contracts and shall cooperate to implement Section 3.9. To the extent Sellers
and respective guarantors of Real Estate Loans listed in Exhibit 3.7 being
assumed by Purchaser are not released by the creditors at Closing, then
Purchaser shall indemnify Seller for any amounts claimed under the related loans
or guarantees (or cause such Real Estate Loans to be paid or refinanced.
6. Purchase Price
6.1 Base Price. The purchase price for the Acquired Assets (herein the
"Purchase Price") shall amount to $24,000,000 allocated as set forth in Exhibit
6.1 plus the assumption of the Assumed Liabilities, provided that, despite the
inclusion of Real Estate Loans as Assumed Liabilities, to the extent Purchaser
assumes Real Estate Loans or pays them off at Closing, it shall receive a credit
against the cash portion of the Purchase Price for the full amount assumed or
paid. The balance of the Purchase Price, except for $400,000, which shall be
placed in escrow as hereafter provided, shall be payable in cash after all of
the required events to consummate the Closing are complete (the "Closing Cash
Payment").
6.2 The purchase price shall be allocated among the Assets as shown on Exhibit
6.2. The parties shall make consistent use of the allocations specified in
Schedule 6.2 for all tax purposes and in all filings, declarations and reports
with the IRS in respect thereof, including the reports required to be filed
under Section 1060 of the Code. The Purchaser shall prepare and deliver IRS
Form 8594 to Seller within forty-five (45) days after the Closing Date. The
Parties shall confer in good faith to resolve any adjustments proposed to such
allocation by the Seller and if unable to resolve any disagreements shall engage
the services of the Independent Accountant to resolve the dispute. The fees and
expenses of the Independent Accountant shall be shared equally by Purchaser and
Seller. In any proceeding related to the determination of any Tax, no Party
shall contest or represent that such allocation is not a correct allocation.
6.3 Payments to Seller under this Agreement shall be made to an account
designated by Seller in writing which shall be delivered by Seller to Purchaser
no later than two (2) business days prior to the Closing Date; payments to such
bank account shall be made by wire transfer in immediately available funds free
of bank and/or any other charges and shall be deemed effective when
unconditionally and irrevocably credited to such bank account. Each Seller
hereby appoints Trans-Lux Multi-Media Corporation as its agent to receive such
payment on its behalf and to distribute each Seller's portion thereof, and
agrees Purchaser shall have no responsibility for such matters.
6.4 Additional Earn Out Purchase Price
Purchaser shall pay to Seller an additional amount ("Earn Out") of no less
than $500,000 and no more than $2,800,000 based on the EBITDA of the
DreamCatcher Theatre in Espanola, New Mexico, including the four (4) additional
screens which were just constructed and opened May 9, 2008. The amount of the
Earn Out will be calculated by applying a multiple of 7 times the difference of
the EBITDA of the DreamCatcher Theatre during the 12-month period from
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June 1, 2008 through May 31, 2009 and the EBITDA of such DreamCatcher Theatre
during the twelve month period from June 1, 2007 through May 31, 2008 which the
parties agree shall be presumed to be $400,000. Any expenses Purchaser incurs
with respect to the DreamCatcher Work (defined below) beyond the agreed upon
loan draw for the Unpaid Balance (defined below) shall be deducted from the
Earn-Out. Such EBITDA shall be calculated in a manner consistent with the
sample calculation for the twelve month period ended December 31, 2007 attached
as Exhibit 6.4.
As an illustration, if the DreamCatcher Theatre generated $600,000 of EBITDA
during the twelve month period before the completion of such construction and
$1,000,000 in EBITDA for such theatre during the twelve months after the
completion of such construction, the Purchaser shall pay the Seller an
additional $2,800,000.
At Closing Purchaser shall pay Seller a non-refundable advance of $500,000
against such Earn Out which shall be kept and retained by Seller in all events.
The balance of the Earn Out will be paid in three installments. The first
installment shall be due thirty (30) days following the last day of the fourth
month ending after the Closing, and the remaining installments shall be due
within thirty (30) days after the last day of each successive four-month period,
with the first $500,000 in Earn Out payments credited against the non-refundable
advance. Purchaser agrees it will use normal operating procedures at such
Theatre such as marketing and advertising at least equivalent to Seller's
current practices to support EBITDA during the 12-month Earn Out period. With
each payment due or application of credit, Purchaser shall provide Seller with a
computation of the EBITDA comparison certified by Purchaser's independent
accountant or chief financial officer. Seller shall be entitled to inspect
Purchaser's books and records concerning the DreamCatcher Theatre for such 12
month period by Seller's accounting staff provided the results of such audit are
kept confidential except as necessary to enforce payment in any dispute by the
parties as to the applicable amount. The payments to Seller will be made to the
same bank account specified in this Agreement unless Purchaser is otherwise
notified in writing by Seller.
6.5 Escrow.
(a) At the Closing, Purchaser shall deposit, in escrow, with Xxxxxxxxx
Escrow (the "Escrow Agent"), by wire transfer of immediately available funds,
the sum of $400,000.00, which amount shall constitute the claims escrow account
("Claims Escrow Account"). The Claims Escrow Account, together with any
interest thereon, is herein referred to as the "Escrow Deposit." At the Closing,
Purchaser, Seller and Escrow Holder shall enter into the Indemnity Escrow
Agreement attached as Exhibit 6.5(a).
(b) The Parties shall enter into an escrow agreement (the "Closing Escrow
Agreement") with First American Title Company in the form attached as Exhibit
6.5(b).
7. Pre-Closing Conditions
The sale and purchase of the Assets shall be consummated at the Closing and
pursuant to Section 8 below (herein "Closing") only if the following conditions
precedent (herein "Pre-Closing Conditions") are fulfilled, unless waived in
writing by the applicable Party:
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7.1.1 Execution and delivery of all documents and agreements necessary for the
assumption by Purchaser from Seller of the Real Estate Loans secured by the
Seller's Facilities.
7.1.2 Execution and delivery of deeds of title to the Facilities to Purchaser,
accompanied by commitments for or pro forma ALTA title insurance policies issued
by First American Title Company in Purchaser's favor showing fee title vested in
Purchaser, with only such qualifications and exceptions as are reasonably
satisfactory to Purchaser.
7.1.3 Execution and delivery of consent to the transfer of the joint venture
interest in Metro-Lux Theatre, including a waiver of all purchase or first
refusal rights.
7.1.4 Execution and delivery of a Xxxx of Sale in form and substance reasonably
satisfactory to Purchaser for all other Acquired Assets.
7.1.5 Execution and delivery of the Memorandum of Option contemplated by Section
2.6 with respect to the Silver City Agreement.
7.1.6 Execution and delivery of the Trademark License Agreement.
7.1.7 Each Party shall have provided the other evidence sufficient to
demonstrate that such Party has obtained appropriate approvals (other than to
Assumed Contracts) to conclude the transactions contemplated in this Agreement.
7.1.8 The representations and warranties of Seller set forth in Section 9 hereof
and in all agreements, documents and instruments executed and delivered pursuant
hereto or in connection with the Closing shall have been and be true and correct
in all material respects as of the Economic Effective Date and as of the Closing
Date as though made on and as of the Closing Date. Seller shall have performed
in all material respects its agreements and obligations under this Agreement
prior to the Closing Date.
Seller and Purchaser shall mutually inform each other without undue delay as
soon as either Party has become aware that the Pre-Closing Conditions have been
fulfilled.
8. Closing
It is intended that this transaction close on or before July 31, 2008; provided
that this Agreement may be terminated by Purchaser, on the one hand, or by
Seller, on the other hand, by written notice to the other parties hereto if the
Closing shall not have been consummated on or before August 31, 2008, unless
such date is extended upon mutual agreement of such parties; provided further,
that the party terminating this Agreement under this Section 8 shall not then be
in material breach of any of its obligations under this Agreement.
At the Closing the following events (herein "Closing Events") shall occur:
8.1 At the Closing each Party shall deliver originals of the Ancillary Documents
and a certificate that the Pre-Closing Conditions have been fulfilled.
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8.2 At the Closing Purchaser shall pay the Closing Cash Payment less the Escrow
Deposit and receive credit for the amount of Real Estate Loans assumed or paid
off at Closing, constituting the Purchase Price.
8.3 At Closing, Purchaser shall execute and deliver to Seller documents
evidencing its assumption of the Real Estate Loans which documents shall include
releases of Seller and the current guarantors of such Real Estate Loans.
8.4 At Closing Seller shall execute and deliver to Purchaser or the Title
Company the Deeds and the Title Company shall deliver to Purchaser the Title
Policies.
8.5 At Closing Purchaser, Seller and the Escrow Agent will sign the Indemnity
Escrow Agreement relating to the Escrow provisions in Section 6.5.
8.6 At Closing Purchaser shall enter into employment agreements with the persons
named in Exhibit 4.1(d) and agree to the consulting terms and payments as
provided by Section 4.1(e).
8.7 At Closing Seller and Purchaser shall enter into the Transition Services
Agreement in the form of Exhibit 8.7 providing human resources, financial
information and accounting support for up to four (4) months as provided
therein, the Equipment Maintenance Agreement and the Employee Services
Agreement.
8.8 At Closing Trans-Lux Corporation and Purchaser shall enter into the
Trademark License Agreement in the form of Exhibit 2.2.
8.9 At Closing Seller's counsel shall deliver a legal opinion substantially in
the form of Exhibit 8.9 to this Agreement.
8.10 At Closing, Seller may deliver updated disclosure schedules to this
Agreement reflecting changes in the ordinary course of business, none of which
shall involve a Material Adverse Effect, and other changes which are reasonably
satisfactory to Purchaser.
8.11 The Closing shall take place at the offices of First American Title Company
in New York, New York or at such other place mutually agreed upon by the
Parties.
8.12 Purchaser and Seller shall have the right to waive one or more of the
Closing Events by a mutual written consent.
8.13 "Closing Date" shall be the date on which the Closing Events have occurred,
to the extent that such Closing Events have not been duly waived by the Parties,
and Purchaser's payment of the Purchase Price and Escrow Deposit shall evidence
the Closing.
9. Representations
9.1 Organization and Authority. The Parties hereby respectively represent and
warrant as follows:
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(a) Each of the Parties is a corporation validly existing and in good
standing under the laws of its jurisdiction of incorporation and duly qualified
to do business in any jurisdiction where such qualification is required to avoid
a Material Adverse Effect.
(b) Each of the Parties has the corporate power and corporate authority to
enter into this Agreement and the Ancillary Documents to which it is
contemplated to be a party and to perform its obligations hereunder and
thereunder. The execution, delivery and performance of this Agreement and the
Ancillary Documents by each Party and the consummation of the transactions
contemplated hereby and thereby have been duly authorized and approved by the
Board of Directors of such Party and the shareholders of each Party and no other
corporate proceedings on the part of such Party or the shareholders of such
Party are necessary to authorize and approve this Agreement or such Party's
Ancillary Documents and the transactions contemplated hereby and thereby. This
Agreement and each Ancillary Document contemplated to be delivered by the
Parties has been duly executed and delivered by a Party. This Agreement and
each Ancillary Document contemplated to be executed and delivered by a Party
constitutes a valid and binding obligation of such Party, enforceable against
such Party in accordance with its terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or similar laws affecting creditors' rights generally or by the
principles governing the availability of equitable remedies.
9.2 Performance of Assumed Contracts and the Business
(a) Seller represents and warrants that the Assumed Contracts are in full
force and effect in the form delivered to Purchaser without any amendment, and
without any default, breach or violation by Seller, and without any event or
omission which, upon notice, lapse of time, or both notice and lapse of time,
would constitute a default by Seller, and, to the best knowledge of Seller are
enforceable against the parties thereto in accordance with their terms. Except
as set forth in Exhibit 9.2(a), Seller has performed and complied with all
obligations under the Assumed Contracts in all material respects. Seller has
not received any notice of termination, intent not to renew, or proposal to
amend with respect to any Assumed Contracts.
(b) Except as set forth in Exhibit 9.2(b), the Business has been operated
in the normal course since December 31, 2007.
(c) Since December 31, 2007, Seller has not acquired or sold any fixed
assets or other non-current asset used in connection with the Business in excess
of $50,000 except in the ordinary course of business except with respect to the
Espanola Project described in Section 6.4 or as disclosed by Seller in Exhibit
9.2(c).
(d) the Assumed Contracts include all Contracts needed for Purchaser to
operate the Business in substantially the same manner as Seller has been
operating the Business.
9.3 Intellectual Property
(a) Seller represents and warrants that the Intellectual Property includes
such existing trade names and trade marks as are in all material respects
sufficient to conduct the Business immediately following the Closing as it is
currently conducted. Trans-Lux Corporation, licensor,
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owns, and has the right to convey or license, all such Intellectual Property,
free and clear of Encumbrances except as disclosed on Exhibit 9.3(a).
(b) Seller is not now the subject of any pending infringement,
interference, opposition or similar action, suit or proceeding challenging the
use by the Business of any Intellectual Property. Seller has not received any
written or oral claim that its use of such Intellectual Property infringes upon
the rights of any third party and is not aware of any reasonable basis for such
a claim or assertion.
(c) To the Knowledge of Seller, except as set forth in Exhibit 9.3(c), the
Seller has not received notice of claims or demands against the Seller in
writing that the conduct of the Business by Seller infringes in any material
respect on any valid intellectual property rights of any other Person.
(d) There are no patents or patent licenses used in, or necessary to
conduct, the Business.
9.4 Acquired Assets
Seller represents and warrants that Seller has, and at the Closing will convey,
good and marketable title to the Acquired Assets, including fee simple title to
each property listed on Exhibit 2.1.1, except as otherwise noted in the
applicable title reports. Except for liens being released at Closing and liens
and encumbrances securing or relating to the Real Estate Loans and encumbrances
of record listed in the Title Reports, there are no Encumbrances on the Acquired
Assets. The Seller has maintained insurance coverage on the Business up to the
Closing Date, and will continue its liability and casualty insurance in force
with respect to claims based on events prior to the Closing Date for at least
twelve months after the Closing Date and Purchaser has established its own
insurance coverage effective as of the Closing Date. The Acquired Assets are in
good operating condition and are currently operating as theatres in the normal
course of the Business. Except as noted on Exhibit 9.4, the Acquired Assets are
sufficient to permit Purchaser to carry on the Business following the Closing in
the manner conducted immediately prior to the Closing, without material
interruption, except that Purchaser acknowledges operating cash in excess of
$10,000 will not be transferred.
9.5 Litigation and Compliance with Law
Seller represents and warrants that, except as disclosed in Exhibit 9.5, there
are no court litigations, arbitrations, governmental investigations or
inquiries, or administrative proceedings pending or to the knowledge of Seller,
threatened against Seller, with respect to the Business or the Acquired Assets,
which would materially adversely affect the Business or the Acquired Assets
taken as a whole, or would materially adversely affect any Facility or its
continued operation. The Seller is current in payment of applicable income,
sales, payroll and other taxes and is in compliance with all material respects
with, and has not received any notices or claims that the Seller is not in
compliance with applicable law including ERISA and environmental laws.
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9.6 Purchaser Employees
Seller represents and warrants that, since February 29, 2008, except for
terminations in the ordinary course of business, none of the Employees of the
Business has terminated his/her current employment or, to Seller's knowledge,
has threatened to terminate such employment.
9.7 Labor Matters
Seller represents and warrants that, with respect to the persons proposed to
become Purchaser Employees, Seller is in compliance with all laws and
regulations dealing with wages, hours, payroll taxes, vacations and working
conditions for its employees; all compensation and withholding obligations of
Seller to or in respect of the employees of the Business for periods prior to
the Closing Date have been paid or accrued by Seller, and the accrued portions
thereof shall constitute a Retained Liability, except that Purchaser has agreed
to pay normal accrued payroll for the weekly or bi-weekly period preceding the
Closing Date, except to the extent included in the Reconciliation of the Theatre
Business Cash Flow. At or prior to the Closing, Seller will satisfy all
obligations for pre-Closing accruals of vacation time, and no such pre-Closing
vacation time shall be an Assumed Liability. For purposes hereof, if the
employee is entitled to four weeks for 2008 and the Closing is June 30, 2008,
then two weeks have accrued and Purchaser is liable for the remaining two weeks
except to extent taken prior to Closing.
9.8 Financial Statements. Seller represents and warrants that the financial
information for the Business listed in Exhibit 9.8 fairly present the financial
results and position set forth therein on the basis of generally accepted
accounting principles applied on a consistent basis except as listed or noted in
such statements or otherwise disclosed in exhibits or schedules to this
Agreement.
9.9 Complete Disclosure. Seller represents and warrants that no representation
by Seller in this Agreement contains any untrue statement of a material fact or
omits to state a material fact necessary to render the statements made not
misleading. If and to the extent any of the representations of Seller in this
Section are made to Sellers' knowledge, such knowledge means actual knowledge by
Seller's officers or directors, after such inquiry of subordinates as would be
made by a prudent person under the circumstances. Seller has delivered to
Purchaser complete and correct copies of all Assumed Contracts.
9.10 Permits and Authorizations. In each case, with respect to the Business:
(a) Exhibit 9.10 lists each material consent, license, permit, grant or
------------
other authorization of a Governmental Entity held by Seller or pursuant to which
Seller conducts the Business or holds any Assets (herein collectively called
"Authorizations"). All Authorizations are in full force and effect and
constitute all Authorizations required to permit Seller to operate its Assets
and conduct the Business and to permit Purchaser to conduct the Business
following the Closing Date as the Business is presently operated and conducted.
To the extent transferable, Seller will transfer such Authorizations as Acquired
Assets. Exhibit 9.10 also discloses all proposed or pending applications for
Authorizations, the expiration date of all material Authorizations having an
expiration or required renewal date, and all applications for variances
15
from compliance, or postponement of the dates for compliance with any laws or
regulations affecting Seller or the Business, and all non-transferable
Authorizations.
9.11 Employee Benefits
(a) Exhibit 9.11 sets forth a list of all "employee benefit plans" (as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended, ("ERISA")) and all other profit-sharing, deferred compensation,
bonus, stock option, stock purchase, vacation pay, holiday pay, pension,
retirement plans, medical and other compensation or benefit arrangements
maintained or contributed to or required to be contributed to by Seller within
six (6) years prior to the Closing for the benefit of the employees (or former
employees) of the Business and/or their beneficiaries (collectively, the
"Benefit Plans").
9.12 No Brokers. Except for Jesup & Xxxxxx, whose fee is being paid by Seller,
none of the Parties, nor any director, officer or employee thereof, has employed
or dealt with any broker or finder or has incurred or will incur any broker's,
finder's or similar fee, commission or expense, in each case in connection with
the transactions contemplated by this Agreement or the Ancillary Documents.
9.13 DreamCatcher Construction. Seller represents and warrants that (i) all
construction work at the DreamCatcher Theatre, including, without limitation,
the construction of four (4) additional screens (the "DreamCatcher Work") has
been completed as of May 9, 2008 and there is no on going construction work at
the DreamCatcher Theatre except for "punch list" or warranty work, (ii) all
costs and expenses in connection with the DreamCatcher Work have been paid
except for a current outstanding balance of approximately $10,069.65 (the
"Unpaid Balance"), (iii) the entire Unpaid Balance will be paid by Seller prior
to the Closing, leaving only approximately $15,000 for "punch list" items to be
invoiced and paid, (v) Seller will not submit any other applications for payment
under that certain building loan dated April 9, 2007 (the "Construction Loan")
with Century Bank, and (vi) except for the Unpaid Balance and amounts due for
"punch list" items, there are no other costs and expenses due or outstanding in
connection with the DreamCatcher Work.
Notwithstanding anything to the contrary in this Agreement, the Earn Out
and/or Claims Escrow Account may be reduced by any amounts Purchaser is required
to pay in connection with the DreamCatcher Work, or to remove any mechanics or
materialmen's liens that may be recorded against the DreamCatcher Theatre
property.
9.14 The Parties hereto agree as follows:
NO OTHER REPRESENTATIONS OR WARRANTIES. EXCEPT FOR THE REPRESENTATIONS AND
WARRANTIES CONTAINED IN THIS AGREEMENT, INCLUDING THE EXHIBITS HERETO, SELLER
MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, WRITTEN OR ORAL, AND
SELLER HEREBY DISCLAIMS ANY SUCH REPRESENTATIONS OR WARRANTIES (INCLUDING
WITHOUT LIMITATION ANY WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A
PARTICULAR PURPOSE, OR FUTURE PROFITS, REVENUES, OPERATIONS OR OTHER FUTURE
EVENTS), WHETHER BY SELLER, OR ANY OF ITS OFFICERS,
16
DIRECTORS, EMPLOYEES, AFFILIATES, AGENTS OR REPRESENTATIVES OR ANY OTHER PERSON,
WITH RESPECT TO THE BUSINESS OR THE ACQUIRED ASSETS OR THE EXECUTION AND
DELIVERY OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY,
NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO PURCHASER, ANY AFFILIATE OF
PURCHASER OR ANY OF THEIR OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR
REPRESENTATIVES OR ANY OTHER PERSON OF ANY DOCUMENTATION OR OTHER INFORMATION BY
SELLER OR ANY OF ITS AFFILIATES, OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR
REPRESENTATIVES OR ANY OTHER PERSON, WITH RESPECT TO ANY ONE OR MORE OF THE
FOREGOING. PURCHASER ACKNOWLEDGES THAT IN ENTERING INTO THIS AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED HEREBY IT IS NOT RELYING ON ANY INFORMATION OTHER THAN
THE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN THIS AGREEMENT AND THE
EXHIBITS HERETO.
10. Conduct of Business Pending Closing. During the period commencing on the
date hereof and continuing through the Closing Date, Seller covenants and agrees
to conduct its business as follows (except as otherwise expressly contemplated
by this Agreement or as otherwise consented to by Purchaser in writing):
10.1 Qualification. Seller shall maintain all qualifications to transact
business and remain in good standing in the applicable states of incorporation
and foreign jurisdictions except where the failure to maintain such
qualifications would not have a Material Adverse Effect.
10.2 Ordinary Course. Seller shall conduct its business in, and only in, the
ordinary course and, to the extent consistent with such business, shall preserve
intact its current business organizations, use its commercially reasonable
efforts to keep available the services of its current officers and employees and
preserve its relationships with customers, suppliers and others having business
dealings with it to the end that its goodwill and going business value shall not
be adversely impacted in any material respect at the Closing Date.
10.3 Organizational Changes. Seller shall not (a) amend its organizational
documents in any manner which could have an adverse impact on the transactions
contemplated by this Agreement, (b) merge or consolidate with any other Person,
(c) liquidate or dissolve, or (d) obligate itself to do any of the foregoing.
10.4 Liens. Seller shall not grant any Liens on the Assets.
10.5 Accounting. Seller shall not make any change in the accounting principles,
methods, records or practices followed by Seller or depreciation or amortization
policies or rates theretofore adopted by Seller. Seller shall maintain Seller's
books, records and accounts in accordance with GAAP applied on a basis
consistent with that of prior periods.
10.6 Compliance with Laws. Seller shall comply in all material respects with
all laws applicable to it and its operations.
10.7 Disposition of Assets. Seller shall not sell, transfer, license, lease or
otherwise dispose of, or suffer or cause the encumbrance by any Lien upon, any
of the Assets, except for (i) sales of
17
inventory in the ordinary course and (ii) except for licenses in ordinary course
consistent with past practice including rental of theatres for use as auditorium
for church services or parties or business meetings.
10.8 Compensation. Seller shall not do any of the following: (a) adopt or
amend in any material respect any collective bargaining, bonus, profit-sharing,
compensation, stock option, pension, retirement, deferred compensation,
employment or other plan, agreement, trust, fund or arrangement for the benefit
of employees (whether or not legally binding) other than to comply with any
applicable laws, (b) except in the ordinary course, pay, or make any accrual or
arrangement for payment of, any compensation or bonuses or enter into any
employment or loan or loan guarantee agreement with, any current or former
officer, director, employee or consultant of Seller or (c) enter into any
severance or termination agreement with respect to any officer or key employee
of the Business.
10.9 Modification or Breach of Agreements; New Agreements. Seller shall not
terminate or modify, or commit or cause any act that will result in any breach
or violation of or constitute a default under (with or without notice or passage
of time, or both) or otherwise give any Person a basis for nonperformance under,
any indenture, mortgage, deed of trust, loan or credit agreement, lease, license
or other agreement, instrument, arrangement or understanding, written or oral,
disclosed in this Agreement or the exhibits hereto. Seller shall not become a
party to any contract or commitment other than in the ordinary course. Seller
shall meet all of its contractual obligations in accordance with their
respective terms.
10.10 Capital Expenditures. Seller shall make capital expenditures in the
ordinary course, in an amount of at least the amount budgeted for and consistent
with the needs of the Business.
10.11 Maintain Insurance. Seller shall maintain its insurance policies in full
force and effect and shall not do or permit to be done any act by which any of
the insurance policies may be suspended, impaired or canceled.
10.12 Discharge. With respect to the Business, Seller shall not cancel,
compromise, release or discharge any claim of Seller upon or against any Person
or waive any right of Seller of material value, and shall not compromise any
debt or other obligation of Seller to any Person other than Liens, debts or
obligations with respect to current liabilities of Seller.
11. Indemnification
11.1 (a) Seller shall indemnify and hold harmless Purchaser and its Affiliates
("Purchaser Indemnified Parties") from and against any and all Losses which are
incurred by one or more Purchaser Indemnified Parties after the Economic
Effective Date:
(i) resulting from the breach of any representation or warranty made
by Seller in this Agreement or any Seller Ancillary Document;
(ii) resulting from the breach of any covenant or agreement of Seller
contained herein or any Seller Ancillary Document;
18
(iii) constituting Retained Liabilities (including liabilities under
any Benefit Plan); or
(iv) constituting claims under any Environmental Law with respect to
the Facilities that have been asserted and are outstanding as of the Economic
Effective Date or which arise from events, conditions or actions prior to the
Economic Effective Date; or
(v) any mechanics' or materialmen's liens in connection with the
DreamCatcher Work and any costs or expenses in excess of the Unpaid Balance for
the DreamCatcher Work or any other pre-Closing construction work.
(b) Purchaser shall indemnify and hold harmless Seller and its Affiliates
("Seller Indemnified Parties") from and against any and all Losses which are
incurred by one or more Seller Indemnified Parties:
(i) resulting from the breach of any representation or warranty made
by Purchaser in this Agreement or any Purchaser Ancillary Document;
(ii) resulting from the breach of any covenant or agreement of
Purchaser contained herein or any Purchaser Ancillary Document;
(iii) constituting Assumed Liabilities or arising from operation of
the Business on or after the Economic Effective Date, or
(iv) constituting environmental claims based on events, conditions, or
actions arising after the Economic Effective Date. The discovery of a condition
after the Economic Effective Date shall not create a presumption such condition
first arose after the Economic Effective Date.
11.2 Procedure. Any claim for indemnification under Section 11.1 will be made
in accordance with this Section 11.2. In the case of any claim for
indemnification arising from a claim or demand of a third Person, an Indemnified
Party will give prompt written notice, in no event more than ten (10) days
following such Indemnified Party's receipt of such claim or demand, to the
Indemnifying Party describing in reasonable detail the basis of such claim or
demand as to which it may request indemnification hereunder. Any other claim
for indemnification will be made as promptly as practicable after the time the
Indemnified Party becomes aware of the facts forming the basis of such claim, in
each case. Any delay in giving notice of a claim shall not reduce the liability
of the Indemnifying Party except to the extent it materially impairs the
Indemnifying Party's ability to defend a claim. The Indemnifying Party will
have the right to defend and to direct the defense against any such claim or
demand, in its name or in the name of the Indemnified Party, as the case may be,
at the expense of the Indemnifying Party and with counsel selected by the
Indemnifying Party, provided that the Indemnifying Party may not settle or
compromise any such claim or demand without the written consent of the
Indemnified Party (which consent may not be unreasonably withheld or delayed) if
injunctive or other equitable relief would be imposed against the Indemnified
Party as a result thereof. The Indemnified Party will cooperate with the
Indemnifying Party and keep the Indemnifying Party fully informed in the defense
of any such claim or demand. The Indemnified Party will have the right to
participate in (but not control) the defense of any claim or demand with counsel
employed by it
19
at the expense of the Indemnified Party. The Indemnified Party may control such
defense at the Indemnifying Party's expense if the Indemnifying Party refuses or
fails to do so or the Indemnified Party shall have defenses not available to the
Indemnifying Party and if counsel to the Indemnified Party shall advise in a
written opinion reasonably acceptable to the other Party that common
representation is not appropriate because of a conflict of interest or on
another described reasonable basis (provided that in any such situation, the
Indemnified Party shall not be entitled to employ more than one law firm at the
expense of the Indemnifying Party). The Indemnifying Party will have no
indemnification obligations with respect to any such claim or demand which is
settled by the Indemnified Party without the prior written consent of the
Indemnifying Party, unless the Indemnifying Party has failed or refused to
defend such claims.
11.3 Exclusive Remedy; Cooperation. The rights of the Parties under Sections
11.1 and 11.2 (and under Section 6.4 and Section 13) will be the exclusive
remedy of the Parties with respect to breaches of representations, warranties,
covenants or agreements contained in or made pursuant to this Agreement or any
Ancillary Document.
(a) Each of Purchaser, on the one hand, and Seller, on the other hand,
agrees that, unless the other Party shall otherwise direct in writing, it will
use commercially reasonable efforts to recover amounts under insurance policies
to the extent such recoveries would reduce amounts required to be paid by the
other pursuant to this Section 11.
(b) In the event that an Indemnifying Party is obligated to indemnify an
Indemnified Party pursuant to this Section 11, the Indemnifying Party will, upon
payment of such indemnity, be subrogated to all rights of the Indemnified Party
with respect to claims to which such indemnification relates.
(c) In the event and for so long as a Party or any of its Affiliates is
contesting or defending against any third party action, suit, proceeding,
hearing, investigation, charge, complaint, claim, or demand in connection with
any fact, status, condition, activity, occurrence, event, failure to act or
transaction with respect to the Business prior to the Closing Date, the other
party agrees to (i) cooperate on a reasonable basis with the contesting or
defending party and its counsel and make available information in its possession
relevant thereto and (ii) make available its employees on a reasonable basis, as
necessary, to provide testimony, to be deposed, to act as witnesses and to
assist counsel, all during normal business hours without undue interference with
such party's business and with the responsibilities of such employees, in each
case of clauses (i) and (ii) as shall be necessary in connection with the
defense or contest thereof, all at the sole cost and expense of the requesting
Party or its Affiliate, as the case may be.
(d) No claim for indemnification may be made by an Indemnified Party
pursuant to this Section for breach of a representation or warranty unless (i)
notice of such claim (describing the basic facts or events, the existence or
occurrence of which constitute or have resulted in the alleged breach of a
representation or warranty made in this Agreement or any Ancillary Document) has
been given to the Indemnifying Party during the applicable survival period set
forth in Section 11.4 or (ii) such claim relates to a Retained Liability or to
Taxes.
11.4 Seller shall have no liability under Section 11.1 unless and until the
aggregate amount of all Losses which are otherwise recoverable under this
Section or any Seller Ancillary Document
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(but for this Section 11.4) exceeds Five Thousand US Dollars ($5,000) after
which Seller shall be responsible for amounts in excess of such threshold up to
the maximum hereinafter set forth. If such threshold is exceeded, Purchaser
shall be entitled to the indemnification pursuant to Section 11.1(a) to the
extent Seller's liability exceeds $5,000 up to a maximum aggregate amount of Six
Hundred Thousand US Dollars ($600,000). This maximum amount shall not apply
with respect to claims relating to a failure to convey marketable title to any
Acquired Assets, any claim based upon a Seller's lack of authority to execute,
deliver or perform obligations under this Agreement or any Ancillary Document,
or any Retained Liability. Purchaser may set-off claims for indemnity against
the Earn-Out, and, if the Escrow Amount is not sufficient or has been released,
may assert claims directly against Seller.
11.5 The representations and warranties contained in or made pursuant to this
Agreement or any Ancillary Agreement will survive the Closing, but will
terminate and be of no further force or effect twelve (12) months from the date
of the Economic Effective Date, but Seller's representations as to Taxes and
ERISA shall not terminate until applicable statutes of limitations expire and
Seller's representations as to environment will last for thirty-six (36) months.
12. Additional Obligations
12.1 If the Closing takes place, Seller agrees to hold in strict confidence and
not to disclose to any third party any confidential business information on the
Business transferred to Purchaser except as required by law, or Trans-Lux
Corporation's obligations as a publicly held corporation provided Seller
promptly notifies Purchaser of such requirement, unless such notification is
prohibited by law. Likewise, Purchaser and its affiliates shall not disclose or
use any confidential information of Seller received during due diligence which
is not transferred and shall return such information to Seller immediately after
the Closing The obligations contained in this Section shall be in addition to
those contained in the Non Disclosure Agreement executed by Marwit Capital
Partners II, L.P. in September 2007 and by Five Crowns Capital, Inc. on
October 11, 2007. If the Closing does not occur, Purchaser and its affiliates
will continue to abide by such Non Disclosure Agreements. Information shall not
be deemed confidential for the purposes of this Agreement if such information:
is already in the public domain or generally available to the public;
has become available to the public without any breach by Seller;
is no longer confidential or as otherwise provided in the second paragraph
of the Non Disclosure Agreements.
12.2 Cooperation. Subject to the terms and conditions hereof, Seller and
Purchaser will each use their respective reasonable efforts:
(a) to defend, consistent with applicable principles and requirements of
law, any third party lawsuit or other legal proceeding, whether judicial or
administrative, challenging this Agreement or the Ancillary Documents or the
transactions contemplated hereby or thereby;
(b) to furnish to each other such information and assistance as may
reasonably be requested in connection with the foregoing; and
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(c) to take, or cause to be taken, all action and to do, or cause to be
done, all things necessary, proper or advisable under applicable laws and
regulations to consummate and make effective the transactions contemplated by
this Agreement and the Ancillary Documents.
12.3 Further Assurances. Any time after the Closing, Seller and Purchaser will
promptly execute, acknowledge and deliver any other assurances or documents
reasonably requested by Purchaser or Seller, to satisfy, or in connection with,
their obligations hereunder. The Parties agree that, except as otherwise
expressly provided in this Agreement (including Exhibits and Schedules) the
Acquired Assets are being sold or licensed "as is" and "where at."
12.4 Office Space and Services. Trans-Lux Corporation shall provide to Xxxxxx
Xxxxxx his current office #108 located at 00 Xxxxx Xxxxxx in Norwalk,
Connecticut (or equivalent office space in the event Trans-Lux Corporation
relocates from its current office location), and an area for an assistant at the
desk currently located near his office, along with office furniture and
equipment which are currently being used by him, including without limitation,
telephone, fax, internet access and office supplies without charge to Purchaser.
The parties acknowledge and agree that such furniture and equipment shall remain
the property of Trans-Lux Corporation. Mail services will be available at the
actual cost of postage. These office areas and services, with the exception of
the postage charges mentioned above, will be provided at no charge to Purchaser
for a period of five years commencing on the Closing Date. Purchaser
acknowledges that Xx. Xxxxxx will also use such office space to support his
activities as a director of Trans-Lux Corporation so long as Xx. Xxxxxx remains
a director of Trans-Lux Corporation.
13. Tax Indemnification
Seller shall indemnify and hold harmless Purchaser from any Taxes, which
relate to the Business, Acquired Assets or Assumed Contracts for any time period
prior to the Closing Date (excluding the portion assumed by Purchaser) and
Purchaser shall indemnify and hold harmless Seller from any Taxes which relate
to Purchaser's Business, the Acquired Assets Assumed Contracts after the Closing
Date and the portion of taxes relating to payroll prior to Closing assumed by
Purchaser hereunder. This indemnity obligation shall not be subject to any
provision of this Agreement limiting the amount of claims or damages or the
period during which indemnity claims pertaining to Taxes may be asserted.
14. Notices
All notices and other communications hereunder shall be in writing and
shall be deemed received by the other Party upon (i) transmitter's confirmation
of a receipt of a facsimile transmission or (ii) confirmed delivery by standard
over-night carrier or when delivered by hand addressed at the following
addresses (or at such other address for a Party specified by the other Party by
written notice):
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(a) In the case of Seller:
Mr. Xxxxxxx Xxxxxxx
Trans-Lux Multi-Media Corporation
c/o Trans-Lux Corporation
00 Xxxxx Xxxxxx
Xxxxxxx, XX 00000
Telecopy: (000) 000-0000
with a copy to:
Xxxxxxx Celler Spett & Xxxxxx, P.C.
Attention: Xxxxxx X. Xxxxxx, Esq.
000 Xxxx Xxxxxx
Xxx Xxxx, X.X. 00000
Telecopy: (000) 000-0000
(b) In the case of Purchaser:
Storyteller Theaters Corporation
c/o Marwit Capital Partners
000 Xxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Telecopy: (000) 000-0000
with a copy to:
Paul, Hastings, Xxxxxxxx & Xxxxxx LLP
000 Xxxx Xxxxxx Xxxxx
Xxxxxxxxxxx Xxxxx
Xxxxx Xxxx, XX 00000
Attn: Xxxxx X. Xxxxxxxx
Telecopy: (000) 000-0000
15. Costs and Expenses
15.1 All costs and expenses of either Party in connection with this Agreement
and the transactions contemplated herein, including but not limited to legal
fees, brokers' fees, appraisals, due diligence, or other advisor fees shall be
borne by the Party which retained such advisor or incurred such expense except
as specifically provided herein. Seller and /Purchaser shall each pay one-half
of all transfer taxes and recording fees, and the cost of any sales taxes
imposed upon transfer of the Acquired Assets. Seller shall pay the cost of
Purchaser's Owner's title insurance excluding the costs of any endorsements
required by Purchaser which endorsements shall be at Purchaser's expense.
Purchaser shall pay all fees or expenses charged by the lenders with respect to
assumption of the Real Estate Loans and all costs of title policies required by
such lenders.
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16. Miscellaneous
16.1 If for any reason any provision of this Agreement shall be declared void or
unenforceable, the remaining provisions shall remain valid. The Parties shall
use reasonable efforts to replace the invalid or unenforceable provision by a
valid and enforceable one, which as far as legally possible implements their
purpose and intent. To the extent permitted by applicable law, each Party
waives the provision of any law which renders any provision of this Agreement
invalid, illegal or unenforceable in any respect.
16.2 In this Agreement the headings are inserted for convenience only and shall
not affect the interpretation of this Agreement.
16.3 This Agreement including its exhibits contains the entire agreement of the
Parties with regard to the subject matter of this Agreement. Changes to and
amendments of this Agreement shall be in writing and agreed upon by both
Purchaser and Seller.
16.4 Obligations under this Agreement, as well as this Agreement itself, may not
be assigned by a Party without the prior written consent of the other Party.
Notwithstanding the foregoing, Purchaser may assign to its lenders all of its
rights and remedies hereunder, including rights to payment from Seller, and its
rights to indemnity, to its lenders, and may, without the consent of Seller,
assign and delegate its rights hereunder or any part thereof or the Agreement in
total to any wholly owned subsidiary of Purchaser, provided Purchaser each
remain fully liable under this Agreement.
16.5 With regard to their obligations and liabilities under this Agreement and
any Ancillary Document the parties included as Seller are jointly and
individually responsible.
16.6 This Agreement is not intended to confer upon any other person any rights
or remedies hereunder.
16.7 Except as provided in Section 15, Seller will be responsible for payment
of, and will indemnify and hold Purchaser, and its Affiliates harmless from and
against, all documentary, stamp, transfer, sales, use, excise and similar Taxes
(other than Income Taxes) imposed upon Seller or Purchaser as a result of the
transactions contemplated by this Agreement. Seller will be responsible for
preparing and timely filing (and Seller will cooperate with Purchaser at
Purchaser's expense in preparing and filing) any forms required with respect to
any such Taxes. Seller will provide to Purchaser a true copy of each such Tax
return as filed as evidence of the timely filing thereof.
16.8 The Parties agree that the Seller shall not be required to comply with the
requirements of any applicable bulk sales laws.
16.9 Representations and Warranties; Exhibits. Neither the specification of any
dollar amount in the representations and warranties set forth in Section 9 nor
the indemnification provisions of Section 11 nor the inclusion of any items in
any Exhibit or Exhibit to this Agreement will be deemed to constitute an
admission by Seller, or Purchaser, or otherwise imply, that any such amounts or
the items so included are material for the purposes of this Agreement. All
documents or information disclosed in any Exhibit to this Agreement are intended
to be disclosed for all
24
purposes under this Agreement, and will also be deemed to be incorporated by
reference in each of the other Exhibits to this Agreement to which they may be
relevant.
16.10 Permits. Notwithstanding any other provision hereof, it will be the
responsibility of Purchaser to obtain any consent, make any filing or take any
action required to transfer permits and licenses to Purchaser and to obtain all
other approvals required for the use of the Acquired Assets by Purchaser.
Seller agrees to provide a list or copies of all permits and licenses used in
the Business and cooperate with Purchaser to assign such permits and licenses or
obtain new permits and licenses.
16.11 Appointment of Seller Representative. Each corporation which is a part of
"Seller" as listed on Exhibit B hereby confirms its appointment of Trans-Lux
Multi-Media Corporation as its agent ("Seller Representative") to receive the
Purchase Price, and to receive all notices to "Seller" under this Agreement, and
its exclusive agent and attorney-in-fact to act on its behalf with respect to
any and all matters, claims, controversies, or disputes arising out of the terms
of this Agreement after the Closing. The Seller Representative shall have the
power to take any and all actions which the Seller Representative believes are
necessary or appropriate or in the best interests of the Seller, as fully as if
each such Seller was acting on its own behalf, including (a) receiving copies of
all notices and communications directed to the Seller under this Agreement and
to take any action or no action in connection therewith as the Seller
Representative may deem appropriate and (b) to take any action (or to determine
to take no action) with respect to this Agreement or the actions contemplated
hereby, whether before or after the Closing, as the Seller Representative may
deem appropriate as effectively as the Sellers could act themselves, including
the settlement or compromise of any dispute or controversy. The authority
granted hereunder is deemed to be coupled with an interest. The dissolution of
any Seller shall not terminate the authority and agency of the Seller
Representative. The Sellers shall hold the Seller Representative free and
harmless from and indemnify the Seller Representative against any and all
liabilities, claims, demands, judgments, losses, costs, damages, obligations, or
expenses whatsoever (including reasonable attorneys', consultants', and other
professional fees and disbursements of every kind, nature, and description
incurred by the Seller Representative in connection therewith) which it may
sustain as a result of any action taken hereunder. The execution by the Sellers
of this Agreement shall be deemed approval of this Section 16.11, and the
appointment of the Seller Representative.
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Signed this 7th day of July , 2008
----- -------------
SELLER:
TRANS-LUX VALLEY CORPORATION
TRANS-LUX DESERT SKY CORPORATION
TRANS-LUX SUMMIT CORPORATION
TRANS-LUX SKYLINE CORPORATION
TRANS-LUX COLORADO CORPORATION
TRANS-LUX DURANGO CORPORATION
TRANS-LUX HIGH FIVE CORPORATION
TRANS-LUX LOVELAND CORPORATION
TRANS-LUX FOUR CORNERS CORPORATION
TRANS-LUX LOS LUNAS CORPORATION
TRANS-LUX STARLIGHT CORPORATION
TRANS-LUX LOMA CORPORATION
TRANS-LUX TAOS CORPORATION
TRANS-LUX STORYTELLER CORPORATION
TRANS-LUX LARAMIE CORPORATION
TRANS-LUX CINEMA CONSULTING CORPORATION
TRANS-LUX MOVIE OPERATIONS CORPORATION
TRANS-LUX NEW MEXICO CORPORATION
TRANS-LUX DREAMCATCHER CORPORATION
TRANS-LUX SOUTHWEST CORPORATION
TRANS-LUX WYOMING CORPORATION
By: TRANS-LUX MULTI-MEDIA CORPORATION,
as Seller Representative
By: /s/ Xxxxxxx X. Xxxxxxx Witness: /s/ Xxxxxx X. Xxxxx
----------------------- --------------------
Name: Xxxxxxx Xxxxxxx
Title: President
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PURCHASER:
STORYTELLER THEATERS CORPORATION
By: /s/ Xxxxx X. Xxxxx Witness: /s/ Xxxxx Xxxx
----------------------- --------------------
Name: Xxxxx X. Xxxxx
Title: Chairman of the Board
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EXHIBIT A
Certain Definitions
"Acquired Assets" shall have the meaning set forth in Section 2.1.
"Administrative Assets" means Assets of Seller and its Affiliates not included
in list of Equipment and not located at the Facilities or at the Administrative
Office which are utilized in providing employee benefits, payroll,
administrative, book and record keeping, billing, tax, financial, insurance and
other like services to the Business.
"Affiliate" shall mean, with respect to a Person, another Person heretofore, now
or hereafter, directly or indirectly, through one or more intermediaries,
controlled by, under common control with, or which controls, the Person
specified (in each case in their capacities as such).
"Agreement" shall mean this Asset Purchase Agreement, including the Exhibits
attached hereto.
"Ancillary Documents" means the Purchaser Ancillary Documents and the Seller
Ancillary Documents, collectively.
"Approval" shall mean any franchise, license, certificate of compliance,
authorization, consent, order, permit, approval or other action of, or any
filing, registration or qualification with, any federal, state, municipal or
other governmental, administrative or judicial body, agency or authority.
"Assets" shall mean all properties, assets, privileges, rights, interests and
claims, personal, tangible and intangible, of every type and description.
"Assumed Contracts" shall have the meaning set forth in Section 3.1.
"Assumed Liabilities" shall have the meaning set forth in Section 3.7.
"Business" shall mean the ownership and operation of nine independent theatres
with 51 screens owned by Seller and identified more specifically on Exhibit
2.1.1 and the 14-plex theatre operated as a 50% joint venture partner with Metro
Colorado Corporation, in Loveland, Colorado and related film booking and
concession sales activities.
"Business Day" means any day other than a Saturday, Sunday or other day on which
banks in New York City, New York, Santa Fe, New Mexico, or Los Angeles,
California are required to or may be closed.
"Claims Escrow Account" shall have the meaning set forth in Section 6.5.
"Closing" shall have the meaning set forth in Section 7.1.
"Closing Cash Payment" shall have the meaning set forth in Section 6.1.
"Closing Date" shall have the meaning set forth in Section 8.
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"Consent" shall mean any consent or approval of, or notice, declaration, report
or statement filed with or submitted to, any Person.
"Documentation" shall have the meaning set forth in Section 2.8.
"Earn Out" shall have the meaning set forth in Section 6.3.
"EBITDA" shall mean, for any relevant period, net income, determined in
accordance with GAAP, plus all expenses for interest, taxes on income,
depreciation and amortization deducted to determine such net income.
"Economic Effective Date" shall have the meaning set forth in Section 2.1.
"Environmental Law" means all laws, federal, state or local, including statutes,
regulations, rules, ordinances and orders which purport to regulate the Release
of Hazardous Materials to the environment, or impose requirements relating to
environmental protection or public or employee health and safety, including,
without limitation, the Comprehensive Environmental Response, Compensation and
Liability Act, as amended, 42 U.S.C. Section 9601 et seq., the Resource
Conservation and Recovery Act of 1976, as amended, 42 U.S.C. Section 6901 et
seq. now known as the Solid Waste Disposal Act, the Emergency Planning and
Community Right-to-Know Act, as amended, 42 U.S.C. Section 11001 et seq., the
Clean Air Act, as amended, 42 U.S.C. Section 7401 et seq., the Federal Water
Pollution Control Act, as amended, 33 U.S.C. Section 1251 et seq., the Toxic
Substances Control Act, as amended, 15 U.S.C. Section 2601 et seq., the Safe
Drinking Water Act, as amended, 42 U.S.C. Section 300f et seq., the Federal
Insecticide, Fungicide & Rodenticide Act, as amended, 7 U.S.C. Section 136 et
seq., the Federal Food, Drug and Cosmetic Act, as amended, 21 U.S.C. Section
301 et seq., and the Occupational Safety and Health Act, as amended, 29 U.S.C.
Section 651 et seq.
"Encumbrance" means any lien, mortgage, pledge, security interest, charge or
encumbrance of any kind, whether voluntary or involuntary, (including any
conditional sale or other title retention agreement, any lease in the nature
thereof, and any agreement to give any security interest).
"Equipment" shall have the meaning set forth in Section 2.1.2.
"Escrow Agent" means Xxxxxxxxx Escrow.
"Excluded Assets" shall have the meaning set forth in Section 2.3.
"Excluded Contracts" shall have the meaning set forth in Section 3.2.1
"Facilities" shall have the meaning set forth in Section 2.1.1.
"GAAP" shall mean generally accepted accounting principles.
"Governmental Authority" shall mean any Federal, State, county, city, town,
village, municipal or other governmental department, commission, board, bureau,
agency, authority or instrumentality.
29
"Income Taxes" shall mean any Taxes in the nature of income or franchise taxes.
"Indemnified Party" shall mean the Purchaser Indemnified Party or Seller
Indemnified Party seeking indemnification pursuant to Section 11
"Indemnifying Party" shall mean the party from which indemnification is sought
pursuant to Section 11.
"Independent Accountant" shall have the meaning set forth in Section 3.10.
"Intellectual Property" shall have the meaning set forth in Section 2.2.
"Knowledge" with respect to Purchaser or Seller means actual knowledge of any
person who is a director or executive officer of such Party except that prior to
the Closing, no knowledge of any employee, officer or director of Seller who
becomes an employee, officer or director of Purchaser shall be attributed to
Purchaser.
"Liens" means any security interest for which a UCC Financing Statement has been
filed.
"Losses" means damages, liabilities and reasonable expenses of investigation or
defense thereof reduced to the extent recovered by the Indemnified Party (or
Affiliates thereof) making the relevant claim for indemnification (through
insurance or otherwise).
"Material Adverse Effect" means any change in, or effect on, the Business, which
is materially adverse to the assets and financial condition of the Business.
"Mixed Documents" shall have the meaning set forth in Section 2.8.
"Person" means and includes an individual, corporation, partnership (limited or
general), joint venture, association, trust, any other unincorporated
organization or entity and a governmental entity or any department or agency
thereto.
"Prepaid Expenses" means all prepaid expenses of Seller in connection with the
Business calculated as of the Closing Date in accordance with U.S. generally
accepted accounting principles consistently applied.
"Purchase Price" shall have the meaning set forth in Section 6.1.
"Purchaser" shall have the meaning set forth in the Recitals.
"Purchaser Ancillary Documents" means all agreements, instruments, documents or
certificates contemplated to be executed and/or delivered by Purchaser at
Closing.
"Purchaser Employee" shall have the meaning set forth in Section 4.1.
"Purchaser Indemnified Parties" shall have the meaning set forth in Section
11.1(a)"Retained Liabilities" shall have the meaning set forth in Section 3.8.
30
"Real Estate Loans" means the bank loans and related mortgages and deeds of
trust listed in Exhibit 3.7.
"Retained Liabilities" shall have the meaning set forth in Section 3.9.
"Seller" shall have the meaning set forth in Exhibit B.
"Seller Ancillary Documents" means all agreements, instruments, documents or
certificates contemplated to be executed and/or delivered by Seller at Closing.
"Seller Indemnified Parties" shall have the meaning set forth in Section 11.
"Seller Representative" shall have the meaning set forth in Section 16.11.
"Silver City Agreement" shall have the meaning given such term in Section 2.6.
"Tax" or "Taxes" means all taxes, charges, fees, levies or other assessments,
and all estimated payments thereof, including but not limited to income, excise,
property, sales, use, value added, environmental, franchise, payroll, transfer,
gross receipts, withholding, social security, and unemployment taxes, imposed by
any governmental authority, including any interest, penalties and additions to
tax relating to such taxes, charges, fees, levies or other assessments.
"Theatre Business Cash Flow" shall have the meaning set forth in Section
3.10(b).
"Title Reports" means those title reports listed on Exhibit 9.4, all of which
have been delivered to Purchaser.
"Trade Receivables" shall have the meaning set forth in Section 2.1.4. Unpaid
Balance" shall have the meaning set forth in Section 9.13.
"WARN Act" shall mean the Worker Adjustment and Retraining Notification Act.
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EXHIBIT B
Sellers
Trans-Lux Valley Corporation
Trans-Lux Desert Sky Corporation
Trans-Lux Summit Corporation
Trans-Lux Skyline Corporation
Trans-Lux Colorado Corporation
Trans-Lux Durango Corporation
Trans-Lux High Five Corporation
Trans-Lux Loveland Corporation
Trans-Lux Four Corners Corporation
Trans-Lux Los Lunas Corporation
Trans-Lux Starlight Corporation
Trans-Lux Loma Corporation
Trans-Lux Taos Corporation
Trans-Lux Storyteller Corporation
Trans-Lux Laramie Corporation
Trans-Lux Cinema Consulting Corporation
Trans-Lux Movie Operations Corporation
Trans-Lux New Mexico Corporation
Trans-Lux DreamCatcher Corporation
Trans-Lux Southwest Corporation
Trans-Lux Wyoming Corporation
32
