Exhibit 10.4
AGREEMENT TO PURCHASE MEMBERSHIP INTEREST
Agreement to Purchase Membership Interest (this "Purchase Agreement"),
dated as of March __, 2001, between Xxxxxx Xxxxxx and group to be formed
("Purchaser"), and HA-LO Industries, Inc., a Delaware corporation ("Seller").
R E C I T A L S
WHEREAS, iDentify Licensing Management, LLC has been organized as a
Delaware limited liability company (the "LLC");
WHEREAS, the members of the LLC have entered into that certain Amended
and Restated Limited Liability Company Agreement, dated as of November 3, 2000
(as amended and restated, the "LLC Agreement) (capitalized terms used herein
shall have the meaning set forth in the LLC Agreement unless otherwise defined
herein);
WHEREAS, Seller is a Member of the LLC and currently the holder of a 30%
Membership Interest in the LLC (together with all rights of Seller as a member
of the LLC and subject to dilution, the "Transferred Interest");
WHEREAS, Ford Motor Company, a Delaware corporation ("Ford") is a Member
of the LLC and the holder of a 64 2/3% Membership Interest in the LLC;
WHEREAS, Xxxxxx X. Xxxxxx ("Xxxxxx") is a Member of the LLC and the
holder of a 5 1/3% Membership Interest in the LLC; and
WHEREAS, Seller desires to sell to Purchaser, and Purchaser desires to
purchase from Seller, 100% of the Transferred Interest upon the terms and
subject to the conditions contained herein.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
hereinafter set forth and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties agree as follows:
ARTICLE 1
PURCHASE AND SALE
1.1 PURCHASE AND SALE. Upon the terms and subject to the conditions
hereof, at the Closing (as defined in Section 1.3), Seller shall sell to
Purchaser, and Purchaser shall purchase from Seller, all of Seller's right,
title and interest in and to the Transferred Interest.
1.2 PURCHASE PRICE. In consideration for the sale of the Transferred
Interest, Purchaser shall pay to Seller the aggregate amount of Twenty Million
Dollars ($20,000,000) (the "Purchase Price"). Six Million Dollars ($6,000,000)
of the Purchase Price shall be paid in immediately available funds on the date
hereof. The remaining Fourteen Million Dollars ($14,000,000) of the Purchase
Price shall be payable at the time and in the manner set forth in Section 1.3
hereof (the "Closing Payment").
1.3 CLOSING.
(a) The closing (the "Closing") of the transaction
contemplated hereby (the "Transaction") shall take place at the offices of Xxxx
Xxxxxx & Xxxxxxxxx, Two Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx
00000, at 10:00 a.m., local time, on April 2, 2001, or at such other place, at
such other time or on such other date prior to April 2, 2001 as the parties may
mutually agree. The date on which the closing actually occurs is referred to
herein as the "Closing Date".
(b) At the Closing, Seller shall deliver to Purchaser the
following, in each case duly executed and delivered by Seller (the "Seller
Closing Documents"):
(i) an Assignment of Membership Interest in the form of
EXHIBIT A attached hereto and by this reference made a part hereof (the
"Assignment"), pursuant to which, among other things, Seller shall convey to
Purchaser the Transferred Interest;
(ii) the Agreement in the form of EXHIBIT B attached
hereto and by this reference made a part hereof (the "Ford Agreement"); and
(iii) all other documents as, in the reasonable
discretion of Purchaser, are reasonably necessary or desirable to consummate the
Transaction.
(c) At the Closing, Purchaser shall deliver to Seller the
following, in each case duly executed by Purchaser and the other parties thereto
other than Seller, including Xxxx, Xxxxxx and the LLC (the "Purchaser Closing
Documents"):
(i) the Closing Payment in immediately available funds;
(ii) the Assignment;
(iii) the Ford Agreement; and
(iv) all other documents as, in the reasonable
discretion of Seller, are necessary or desirable to consummate the Transaction.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES OF SELLER. Seller represents and
warrants to Purchaser at the date hereof as follows:
(a) STATUS. Seller is a corporation duly incorporated and
validly existing under the laws of the state of Delaware with full power, right
and authority to execute, deliver and perform this Purchase Agreement.
(b) AUTHORIZATION; VALIDITY OF AGREEMENT. The execution,
delivery and performance of this Purchase Agreement by Seller have been duly
authorized by all necessary action on the part of it. This Purchase Agreement
has been, and the Seller Closing Documents to
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which Seller is a party will be, duly executed and delivered by Seller. This
Purchase Agreement constitutes, and when so executed and delivered such Seller
Closing Documents will constitute, the legal, valid and binding obligations of
Seller, enforceable against Seller in accordance with their respective terms.
(c) NO CONFLICT. The execution, delivery and performance of
this Purchase Agreement by Seller does not and will not (with the giving of
notice and/or the passage of time) violate, conflict with, result in a breach
of, loss of rights or creation of a Lien (as defined in Section 2.1(d)) upon the
Transferred Interest or require the consent of or filing with any other person
or entity (including, but not limited to, any governmental bodies, agencies or
instrumentalities) under (i) the certificate of incorporation or bylaws of
Seller, (ii) any agreement, commitment or instrument to which Seller is a party
or by which Seller or Seller's assets are bound or (iii) any law, ordinance,
rule, regulation, order, judgment, decree or the like to which Seller or
Seller's assets are subject.
(d) TITLE TO TRANSFERRED INTEREST. Seller has and, upon
conveyance by Seller to Purchaser in accordance with the terms hereof, Purchaser
will have good, valid and marketable title to the Transferred Interest, free and
clear of all mortgages, liens, pledges, security interests, charges, claims and
other encumbrances (collectively, "Liens") other than Liens created by or under
that certain Security Agreement, dated November 3, 2000, between Seller and
Ford, and Liens created by, under or through Purchaser.
(e) BROKERAGE. No broker, finder, investment banker or
other person is entitled to any brokerage, finder's or other fee or commission
in connection with the Transaction based upon arrangements made by or on behalf
of Seller.
2.2 REPRESENTATIONS AND WARRANTIES OF PURCHASER. Purchaser
represents and warrants to Seller at the date hereof as follows:
(a) STATUS. Purchaser is a _________ duly organized and
validly existing under the laws of the state of its organization with full
power, right and authority to execute, deliver and perform this Purchase
Agreement.
(b) AUTHORIZATION; VALIDITY OF AGREEMENT. The execution,
delivery and performance of this Purchase Agreement by Purchaser have been duly
authorized by all necessary action on the part of it. This Purchase Agreement
has been, and the Purchaser Closing Documents to which Purchaser is a party will
be, duly executed and delivered by Purchaser. This Purchase Agreement
constitutes, and when so executed and delivered such Purchaser Closing Documents
will constitute, the legal, valid and binding obligations of Purchaser,
enforceable against it in accordance with their respective terms.
(c) NO CONFLICTS. The execution, delivery and performance
of this Purchase Agreement by Purchaser do not and will not (with the giving of
notice and/or the passage of time) violate, conflict with, result in a breach
of, loss of rights or require the consent of or filing with any other person or
entity (including, but not limited to, any governmental bodies, agencies or
instrumentalities) under (i) the _______________ of Purchaser, (ii) any
agreement, commitment or instrument to which Purchaser is a party or by which
Purchaser or its assets are
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bound or (iii) any existing law, ordinance, rule, regulation, order, judgment or
decree to which Purchaser or its assets are subject.
(d) FINANCIAL CAPACITY. On the Closing Date, the Purchaser
will have sufficient funds on hand to purchase the Transferred Interest on the
terms and conditions contemplated by this Purchase Agreement, including without
limitation payment of the Closing Payment, and to consummate the transactions
contemplated hereby.
(e) BROKERAGE. No broker, finder, investment banker or
other person is entitled to any brokerage, finder's or other fee or commission
in connection with the Transaction based upon arrangements made by or on behalf
of Purchaser.
ARTICLE 3
ADDITIONAL AGREEMENTS
3.1 FURTHER ASSURANCES. At any time and from time to time after the
Closing Date, each party shall, without further consideration, execute and
deliver to each other party such instruments of transfer and shall take such
other action and execute such other documents as such other party may reasonably
request in order to consummate the Transaction.
3.2 EXPENSES. Except as otherwise provided herein, each party shall
bear its own expenses incurred in connection with the preparation and
negotiation of this Purchase Agreement and with the performance of all
obligations required to be performed by it under this Purchase Agreement.
3.3 SALES TAXES; ETC. Seller shall pay any and all state or local
sales or transfer taxes payable in connection with the transfer of the
Transferred Interest pursuant to this Purchase Agreement.
ARTICLE 4
MISCELLANEOUS PROVISIONS
4.1 NOTICES. Any notice or other communication required or desired to
be given hereunder shall be in writing and shall be given personally, by
facsimile transmission, by delivery by a nationally recognized courier service
or by pre-paid registered or certified mail, return receipt requested, to the
parties as follows:
If to Seller:
0000 Xxxx Xxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Attention: Chief Executive Officer
Facsimile No.: (000) 000-0000
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If to Purchaser:
Xxxxxx X. Xxxxxx
0000 XXXX Xxxxx
Xxxx, Xxxxxxxx 00000
Facsimile No.: 000-000-0000
Notices hereunder shall be deemed to have been delivered and effective
for all purposes hereunder (a) if given by facsimile transmission when such
facsimile transmission is transmitted to the facsimile number specified in this
section and confirmed answerback is received, (b) if given by registered or
certified mail, on the third business day after mailing, or (c) if given by any
other means, when delivered at the address specified in this section. The
address of any party hereto may be changed by a notice in writing given in
accordance with the provisions hereof.
4.2 SURVIVAL; ETC. The representations, warranties, covenants and
agreements of the parties contained in this Purchase Agreement and the documents
delivered pursuant hereto shall survive the consummation of the Transaction
forever.
4.3 WAIVER. Any party may waive compliance by any other with any
provision of this Purchase Agreement; provided, however, that no such waiver
shall be effective unless in writing signed by the waiving party.
4.4 BINDING EFFECT. This Purchase Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.
4.5 ENTIRE AGREEMENT; MODIFICATION. This Purchase Agreement,
including the exhibits attached hereto, contains the entire understanding
between the parties with respect to the subject matter hereof and supersedes any
prior understandings and/or written or oral agreements between them with respect
thereto. This Purchase Agreement may not be modified except in a writing signed
by the parties.
4.6 HEADINGS. The descriptive headings of the articles and sections
of this Purchase Agreement are inserted for convenience of reference only and
shall not control or affect the meaning, interpretation or construction of any
of the provisions hereof.
4.7 GOVERNING LAW. This Purchase Agreement and its validity,
construction and performance shall be governed by and construed and enforced in
accordance with the laws of the State of Michigan.
4.8 COUNTERPARTS. This Purchase Agreement may be executed in
counterparts, each of which shall be an original, but all of which shall
constitute one document.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have executed this Purchase
Agreement on the date first above written.
SELLER:
HA-LO INDUSTRIES, INC.
By: /s/ XXXX X. XXXXX
-----------------------------
Its: CEO
PURCHASER:
By: /s/ XXXXXX X. XXXXXX
-----------------------------
Its: for a GROUP to be formed
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EXHIBIT A
ASSIGNMENT OF MEMBERSHIP INTEREST
FOR VALUABLE CONSIDERATION, the receipt and sufficiency of which are
hereby acknowledged, HA-LO Industries, Inc., a Delaware corporation
("Assignor"), does hereby transfer, assign, sell, set over, deliver, and convey
unto _____________________________ ("Assignee"), one hundred percent (100%) of
its membership interest in iDentify Licensing Management, LLC, a Delaware
limited liability company (the "LLC"), together with all of Assignor's other
right, title and interest in and to its membership interest in the LLC,
including without limitation, all rights and powers of Assignor as a member of
the LLC (the "Transferred Interest"). This assignment is made pursuant to that
certain Agreement to Purchase Membership Interest dated as of March ___, 2001
(the "Purchase Agreement"), between Assignor and Assignee. This assignment is
made subject to the terms and conditions of the limited liability company
agreement of the LLC, as the same has been amended from time to time (such
limited liability company agreement, as the same has been amended from time to
time, the "LLC Agreement").
IN WITNESS WHEREOF, Assignor has hereunto executed this Assignment of
Membership Interest as of the 2nd day of April, 2001.
ASSIGNOR:
HA-LO INDUSTRIES, INC.
By:__________________________
Its:
ACCEPTANCE AND ASSUMPTION
Assignee does hereby accept the foregoing assignment and assume all
obligations of Assignor under the LLC Agreement in the place and stead of
Assignor.
Dated as of April 2, 2001
ASSIGNEE:
By:__________________________
Its:
CONSENTS
The undersigned, being the other members of the LLC, do hereby consent
to the foregoing assignment and the admission of Assignee as a substitute member
of the LLC with respect to the Transferred Interest.
Dated as of April 2, 2001
FORD MOTOR COMPANY
By:_____________________________
Its:
--------------------------------
Xxxxxx X. Xxxxxx
