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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
COOPER DEVELOPMENT COMPANY
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(Exact name of registrant as specified in it charter)
September 5, 1996
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(Date of earliest event reported)
Delaware 1-117727 94-2876745
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(State or other juris- (Commission (I.R.S. Employer
diction of incorporation) File Number) Identification No.)
16160 Caputo Drive Morgan Hill, California 95037
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(Address of principal executive offices) (Zip code)
(408) 779-8088
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(Registrants' telephone number, including area code)
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Item 2. Acquisition or Disposition of Assets.
On September 5, 1996, pursuant to an Asset Purchase Agreement, Cabot
Laboratories, Inc, ("Cabot") a wholly owned subsidiary of Cooper Development
Company (the "Company") entered into a definitive agreement and sold to American
International Industries, ("American") , Cabot's cosmetic product line and
related inventory, tools and dies and intangibles for $2,500,000.
Cabot's cosmetic products include Clear Perfection corrective cosmetics and
a limited line of vitamin enriched lipstick and lipglosses. Net sales for the
twelve and six months ended December 31, 1995 and June 30, 1996 were
approximately $3,700,000 and $1,800,000 respectively.
Costs associated with the sale of Clear Perfection are estimated to be
$130,000.
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Signature
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Cooper Development Company
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(Registrant)
Dated: September 19, 1996 By: /s/ MICHAEL J. BRADEN
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Michael J. Braden
Vice President and Chief
Financial Officer
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Index to Exhibits
Exhibit
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1. Asset Purchase Agreement dated as of September 4, 1996 by and between
Cabot Laboratories, Inc. and American International Industries.
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EXHIBIT 1
ASSET PURCHASE AGREEMENT
This Agreement is made as of the 4th day of September, 1996 (the
"Agreement") by and between Cabot Laboratories, Inc., a New York corporation
having its principal place of business at 16160 Caputo Drive, Morgan Hill,
California 95037 hereinafter referred to as ("Cabot") and American International
Industries, a California general partnership having its principal place of
business at 2220 Gasper Avenue, Los Angeles, California 90040, hereinafter
referred to as ("American").
WITNESSETH
WHEREAS, based upon the representations and warranties herein made by Cabot
and subject to the terms, conditions and undertakings of Cabot contained in this
Agreement, American desires to purchase from Cabot certain of the assets of its
Clear Perfection corrective cosmetics business (the "Business"); and
WHEREAS, based upon the representations and warranties herein made by
American and subject to the terms, conditions and undertakings of American
contained in this Agreement, Cabot desires to sell to American certain of the
assets relating to the Business;
NOW, THEREFORE, in consideration of the mutual promises herein contained,
the parties hereto, intending to be legally bound, do hereby agree as follows:
ARTICLE I. PURCHASE AND SALE OF ASSETS
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1.1 Purchase and Sale of Assets. At the Closing (as hereinafter defined),
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Cabot shall sell, assign and transfer, free and clear of all liens, mortgages,
security interests, charges and encumbrances not disclosed and accepted by
American herein or in any Schedule hereto, to American and American shall
purchase, all of Cabot's right, title and interest in the following assets only
(collectively, the "Assets"):
(a) Cabot's Clear Perfection product line, as more fully described in
Schedule 1.1(a) attached hereto (the "Products");
(b) "Inventories" means all goods, wares and merchandise manufactured
and/or acquired by Cabot in the ordinary course of business for the purpose of
resale to customers of the Business including, without limiting the generality
of the foregoing, work in progress and all other materials and supplies on hand
to be used or consumed in the production of goods, wares, merchandise, all
inventories of the Products, labels, supplies, raw materials, finished goods,
molds and dies;
(c) All films, plates, artwork, and matters used to produce packaging
supplies for and advertising materials relating to the Products, and all
advertising and promotional literature relating to the Products;
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(d) All intangible personal property relating to the Products, including
(i) the name "Clear Perfection" and the goodwill of the Business conducted
herewith or symbolized thereby, (ii) all trademarks (including the right to sue
for past infringement and collect damages for past infringement), trade names,
copyrights, processes, formulas, scientific and/or technical information, trade
secrets, licenses, franchises, molds, dies, customer lists, vendor lists, plans,
reports, samples, prototypes, know-how, all items in application, development or
other pending status and all similar items in written and, where applicable,
electronic form, with such electronic form compatible with American's computer
system and (iii) rights pursuant to sales contracts, purchase orders and all
other contracts;
(e) The goodwill of the Business, together with the exclusive right to
American to represent itself as carrying on the Business in continuation of and
in succession to Cabot and the right to use any words indicating that the
Business is so carried on, and the rights to take assignment of all telephone
numbers used exclusively with respect to the Business;
(f) A nonexclusive, fully paid, nontransferable license to use the name
Cabot in connection with the Products for one year following the Closing; and
(g) All prepaid expenses, deposits and advances relating to the Business.
Unless enumerated in Section 1.1 (a)-(g), all right, title and interest to any
other property, assets and rights, real or personal, tangible or intangible,
including without limitation the accounts receivable of the Business as of the
Closing, owned by Cabot or which are used in connection with the Business shall
remain with Cabot.
1.2 Assumed Liabilities. American shall assume no obligations or
liabilities of Cabot relating to the Business, except those contracts, including
open purchase orders with vendors and suppliers and co-op agreements covering
the period commencing October 1, 1996, set forth on Schedule 3.7. Cabot shall
discharge all accounts payable of the Business set forth on Schedule 3.16 within
seven days of the Closing from the Purchase Price (as defined below) and Cabot
shall furnish American with evidence of such discharge.
1.3 Instruments of Transfer. At the Closing, Cabot shall deliver to
American such bills of sale, assignments and other good and sufficient
instruments of conveyance and transfer, in form and substance satisfactory to
American and its counsel, as shall be effective to convey and transfer to, and
vest in, American title to the Assets. Simultaneously with such delivery, the
Company shall take such action as may be necessary to place American in
possession and control of the Assets. From and after the Closing, at American's
request and without further consideration, Cabot shall execute and deliver such
other instruments and take such other action as American may reasonably require
more effectively to convey and transfer to and vest in American title to the
Assets, and to place American in possession and control thereof.
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1.4 Purchase Price. The purchase price for the Assets shall be Two
Million Five Hundred Thousand Dollars ($2,500,000) (the "Purchase Price") of
which Two Million Dollars ($2,000,000.00) shall be payable at the Closing by
wire transfer to a depository bank designated by Cabot and of which Three
Hundred Thousand Dollars ($300,000.00) shall be payable on the sooner of the
fourteenth day following the Closing or such date as American takes physical
possession of the finished goods portion of the Inventory as contemplated by
Section 1.6. pursuant to the terms of the Escrow Agreement in the form attached
hereto as Exhibit A (the "Escrow Agreement") and of which Two Hundred Thousand
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Dollars ($200,000.00) (the "Returns Fund") shall be released as contemplated by
Section 8.3 pursuant to the terms of the Escrow Agreement. At the Closing,
American shall wire transfer Five Hundred Thousand Dollars ($500,000.00) into
the client trust account of General Counsel Associates, LLP, to be held pursuant
to the Escrow Agreement.
1.5 Allocation of Purchase Price. The Purchase Price shall be allocated
by the parties in accordance with Schedule 1.5 hereto.
1.6 Transitional Matters. Following the Closing, Cabot will promptly
transmit any orders received for the Products to American by fax or courier for
next day delivery. For a period of up to 15 days after the Closing, Cabot will
maintain possession of the Inventory in its warehouse in Morgan Hill, California
and, at the request of American, will fulfill orders for the Products. During
such period of up to 15 days, American will bear the cost of freight and
insurance on such orders and reimburse Cabot for its reasonable labor costs
related thereto. Within 15 days of the Closing, American shall make arrangements
to take possession of the finished goods portion of the Inventory at Cabot's
warehouse and American shall bear all shipping and related costs in connection
with transfering such Inventory to its facilities. In the event that American
identifies in writing Inventory of which it does not want to take possession,
Cabot shall bear the cost of disposal of such Inventory. Following the Closing,
in the event that Cabot receives a payment from a customer of the Business for
Products sold by American after the Closing or American receives payment from a
customer of the Business on the account of an account receivable, Cabot and
American will cooperate to direct such payments to the proper party. Following
the Closing, Cabot and American will cooperate to allocate to the proper party
responsibility for obligations arising under co-op agreements for the periods
beginning and ending October 1, 1996. Promptly following the Closing, Cabot
shall inform vendors or suppliers in possession of any molds and dies for the
Products that ownership of such molds and dies has passed to American. Cabot
will designate a representative to assist with the orderly transfer of the
Assets and the Business to American. Following the Closing, Cabot will not place
any orders with vendors or suppliers without the consent of American.
ARTICLE II. THE CLOSING
The closing of the purchase and sale of the Assets (the "Closing") shall
take place at 10:00 a.m. simultaneously at the respective offices of the parties
on the 4th day of September, 1996 or at such other time and place as the parties
hereto may mutually agree
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upon and shall be designated as (the "Closing Date"). At the closing or as soon
as possible thereafter Cabot shall deliver to American all the Assets.
ARTICLE III. REPRESENTATIONS AND WARRANTIES OF CABOT
3.1 Organization and Corporate Authority of Cabot. Cabot is a
corporation duly organized, validly existing and in good standing under the laws
and State of New York with full power and authority to carry on its business as
now conducted, and to consummate the transactions contemplated by this
Agreement.
3.2 No Violation. Neither the execution and delivery by Cabot of this
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Agreement or other agreements and instruments required by the provisions of this
Agreement, nor consummation of the transactions herein contemplated, nor
compliance with terms, conditions and provisions hereof or thereof will conflict
with or violate any provision of law or the Articles of incorporation or By-Laws
of Cabot or result in violation of or default in any provision of any
regulation, order, writ, injunction or decree of any court or governmental
agency or authority or of any agreement or instrument to which Cabot is a party,
or by which Cabot is bound or to which Cabot or any of the Assets, is subject,
or constitute a default thereunder or result in the imposition or any lien,
charge, encumbrance or security interest of any nature whatsoever upon any of
the Assets pursuant to the terms of any such agreement or instrument.
3.3 Authorization. Cabot has full right, power and authority to execute,
deliver and perform this Agreement and all other documents contemplated hereby,
and to sell, the Assets being sold by Cabot hereunder. This Agreement, and all
other agreements contemplated hereby which are to be executed by Cabot when
executed and delivered by Cabot, will constitute the valid and legally binding
obligations of Cabot enforceable in accordance with their terms, except as the
enforceability of the Agreement or such other agreement may be limited by
bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to
or affecting generally the enforcement of creditor's rights and except as the
remedy of specific performance may be unavailable in certain cases. Cabot
represents that the sale of the Assets has been approved by its shareholders and
is being made with full knowledge of its shareholders.
3.4 Financial Statements; Liabilities. Attached hereto as Schedule 3.4
are unaudited pro forma gross sales statements for the period from January 1,
1996 through July 31, 1996 with respect to Cabot's sales of the Products, which
are accurate in all material respects. Except as disclosed on Schedule 3.4,
Cabot has no liability with respect to the Products, of any nature, whether
accrued, absolute, contingent or otherwise, which will become liabilities of
American upon the consummation of the transactions contemplated herein.
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3.5 Inventories. All the Inventory is set forth on Schedule 3.5. The
portion of the Inventory that is finished goods is of good condition as of the
Closing. The portion of the Inventory that is components is of usable condition
as of the Closing.
3.6 Trademarks, etc. Schedule 3.6 hereto lists all trademarks, service
marks, trade names, licenses to use any of the foregoing, and copyrights,
licenses to use inventions, processes, know-how and trade secrets presently
owned or held by Cabot for use with respect to the Products or in any way
relating to the Products. Cabot has good right to use the names Clear Perfection
and Cabot in every state and foreign country in which it does business without
infringing on the rights of any other person. To its knowledge, after due
inquiry, Cabot has not infringed on or violated in any material any patent,
trademark, trade name or copyright of others with respect to the Products, and,
has not except as disclosed on Schedule 3.6 received any notice, claim or
protest respecting any such violation or infringement with respect to the
Products. Cabot has not given any indemnification to any person in connection
with any patent, trademark, trade name or copyright infringement with respect to
the Products.
3.7 Contracts. All contracts and agreements, whether written or oral,
including open purchase orders with vendors and suppliers and co-op agreements,
which will become obligations of American are listed on Schedule 3.7 hereto.
3.8 Litigation. There are no pending actions, suits or proceedings before
any court, commission, agency or other administrative authority against or
affecting Cabot with respect to the Products or the transactions contemplated by
this Agreement, and Cabot is not the subject of any order or decree with respect
to the Products other than those of general application.
3.9 Employee Matters. No employee of Cabot shall become an employee of
American as a result of or in connection with this Agreement, and American shall
not be obligated to Cabot, any employee of Cabot or any other person under any
employee benefit plan of Cabot.
3.10 Finder's Fee. Cabot has not incurred any obligation of any kind
whatsoever to any person for a finder's fee in connection with the transactions
contemplated by this Agreement, except to Jerry Hirschberg.
3.11 Transactional Approvals. No material approval, authorization, order,
license or consent of, or registration, qualification or filing with any
governmental authority, is required in connection with the execution, delivery
or performance by Cabot of this Agreement.
3.12 No Practices in Violation of Law. To Cabot's knowledge, after due
inquiry, Cabot has not engaged and is not now engaging in any act, conspiracy or
course of conduct with respect to the Products in violation of any applicable
federal or state law, governing
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business practice, and has not received any notice, claim or protest that it is
now or has heretofore been so engaged.
3.13 Governmental and Industrial Approvals. To Cabot's knowledge, after
due inquiry, the labeling, packaging and marketing of the products are in
compliance with all federal laws and regulations and Cabot has received no
communication from any agency of the United States government which would
necessitate any changes in the Products or their labeling or packaging.
3.14. Customers. Schedule 3.14 hereto sets forth a list of all customers
(which for the purpose of this Section 3.14 shall include dealers and/or
distributors) to whom the Products were sold during the period from January 1,
1996 to the date hereof, and including a description of any discounts or trade.
3.15 Suppliers. Schedule 3.15 hereto sets forth a list of all vendors
and other suppliers from and through whom Cabot has purchased goods and services
with respect to the Products during the period from January 1, 1995 through the
date hereof, and including a description of applicable discounts. The
relationships of Cabot with its vendors and suppliers are good commercial
working relationships. Cabot does not have any notice that such vendor or
supplier intends to cancel or otherwise modify its relationship with Cabot or to
decrease or materially to limit its service, supplies or materials to Cabot and
the acquisition of the Assets by American will not adversely affect the
relationship of American (as successor to the Business) with any such vendor or
supplier.
3.16 Accounts Payable. All accounts payable of Cabot relating to the
Business are set forth on Schedule 3.16.
ARTICLE IV. COMPENSATION AND INDEMNIFICATION
4.1 Compensation and Indemnification; General. Subject to all of the
provisions of this Article IV, Cabot by its execution of this Agreement, hereby
agrees to indemnify, defend with counsel reasonably satisfactory to American,
save and hold American harmless from and against, and to compensate it for, any
and all demands, claims, actions, causes of action, assessments, damages,
liabilities, losses, expenses, judgments or deficiencies of any nature
whatsoever (including, without limitation, reasonable attorneys' fees and other
costs and expenses incident to any suit, action or proceeding) received,
incurred or sustained by American which shall arise out of or result from (i)
any breach of any representation, warranty or covenant (including without
limitation those set forth in Article III thereof), or non-fulfillment of any
obligation of Cabot under this Agreement or (ii) the failure by any party to
comply with any Bulk Sales Law applicable to the transfer of the Assets.
4.2 Survival of Representations and Warranties. The representations,
warranties, covenant and obligations of Cabot set forth in this Agreement shall
survive the Closing for one year, except that liability with respect to any
representation, warranty,
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covenant or obligation as to which a claim is made within such one year period
shall continue until finally determined and paid. Any claim under this Article
IV by American must be made by written notice to Cabot within said one year
period.
4.3 Third Party Claims. Should any claims be made or suit or proceeding
be instituted against American within the aforesaid one year period of which, if
valid or prosecuted successfully, would be a matter for which American is
entitled to be defended, held harmless or indemnified under this Article IV (a
"Third Party Claim"), American shall notify Cabot in writing concerning the same
promptly after the assertion or commencement thereof. Cabot shall control the
defense of any Third Party Claim and shall use its best efforts to defeat or
minimize any loss resulting from such Third Party Claim. Cabot shall provide
American with such information and opportunity for consultation as may be
reasonably requested by it. American shall be entitled to participate in the
defense of a Third Party Claim and to engage counsel for such purpose. In the
event of any dispute regarding the reasonableness of a proposed settlement, the
party which will bear the larger financial loss resulting from such settlement
will make the final determination in respect thereto, which determination will
be final and binding in all involved parties. American shall render all
assistance as shall reasonably request in the defense of any Third Party Claim.
4.4 Compensation and Indemnification by American. American, by its
execution of this Agreement, hereby agrees to indemnify, defend, save and hold
Cabot harmless from and against, and to compensate it for, any and all demands,
claims, actions, causes of action, assessments, damages, liabilities, losses,
expenses, judgments or deficiencies of any nature whatsoever (including, without
limitation, reasonable attorneys' fees and other costs and expenses incident to
any suit, action or proceeding) received, incurred or sustained by Cabot which
shall arise out of or result from the operation of the Business or sale of the
Products by American or the breach by American of its obligations under this
Agreement, except as to any claims made under Section 4.1, 4.2 or 4.3.
ARTICLE V. REPRESENTATIONS AND WARRANTIES OF AMERICAN
5.1 Organization and Authority of American. American is a general
partnership duly organized, validly existing and in good standing under the laws
of the State of California, with full power and authority to own or lease and
use its properties and assets, to carry on its business as now conducted, to
execute and deliver this Agreement and to carry out the transactions
contemplated by this Agreement.
5.2 No Violation. Neither the execution and delivery by American of this
Agreement or other agreements and instruments required by the provisions of this
Agreement, nor consummation of the transactions herein or therein contemplated,
nor compliance with the terms, conditions and provisions hereof or thereof will
conflict with or violate any provisions of law or the partnership agreement of
American, or result in a violation of or default in any provision of any
regulation, order, writ, injunction or decree of any court or governmental
agency or authority or of any agreement or instrument to which
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American or any of its general partners is a party or by which American or any
of its general partners is bound or by which American or any of its general
partners is subject, or constitute a default thereunder or result in the
imposition of any lien, charge, encumbrance or security interest of any nature
whatsoever upon any of American's property pursuant to the terms of such
agreement or instrument.
5.3 Authorization. American has full right, power and authority to
execute, deliver and perform this Agreement and all other documents contemplated
hereby. This Agreement and all other agreements and instruments contemplated
hereby which are to be executed by American, when executed and delivered by
American, will constitute the valid and legally blinding obligations of American
and its general partners, enforceable in accordance with their terms, except as
the enforceability of the Agreement may be limited by bankruptcy, insolvency,
reorganization, moratorium, or similar laws relating to or affecting generally
the enforcement of creditors' rights and except as the remedy of specific
performance may be unavailable in certain cases.
5.4 Finder's Fee. Neither American nor any of its general partners has
incurred any obligation of any kind whatsoever to any person for a finder's fee
in connection with the transactions contemplated by this Agreement.
5.5 Litigation. There are no pending actions, suits or proceedings before
any court, commission, agency or other administrative authority, against or
affecting American or any of its general partners, or its business or properties
of the business and properties of its general partners which would impair the
ability of American to perform its obligation under this Agreement.
ARTICLE VI. CONDITIONS PRECEDENT TO AMERICAN'S OBLIGATIONS
All obligations of American under this Agreement are subject to the
fulfillment and satisfaction, prior to as defined or at the Closing, of each of
the following conditions, any one or more of which may be waived by American.
6.1 Delivery of Instruments of Transfer. Cabot shall have delivered to
American such duly executed instruments or transfer of the Assets, including
trademark assignments, as American or its counsel may reasonably require. Cabot
shall have delivered all of the Schedules required by this Agreement and such
Schedules shall have been reviewed by American to its satisfaction. Cabot shall
have executed and delivered the Escrow Agreement.
6.2 Opinion of Counsel to Cabot. Cabot shall have delivered to American an
opinion dated as of the Closing Date of General Counsel Associates LLP, counsel
to Cabot that:
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(a) Cabot has been duly incorporated and is validly existing and in
good standing under the laws of the State of New York.
(b) Cabot has duly executed and delivered this Agreement and the
Escrow Agreement. This Agreement and the Escrow Agreement is the valid and
binding obligation of Cabot enforceable in accordance with its terms, except as
enforceability of the Agreement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar law as relating to or affecting generally
the enforcement of creditors' rights and except as the remedy of specific
performance may be unavailable in certain cases.
(c) Except as disclosed in the Agreement or any Schedule thereto, the
execution and delivery by Cabot of the Agreement, the Escrow Agreement and all
related agreements, and the consummation of the transactions contemplated
thereby do not conflict with or violate any provisions of the Articles of
Incorporation or by-laws of Cabot.
6.3 Non-Competition Agreement. Cabot agrees that for three years after
the Closing it shall not directly or indirectly, in any capacity (i) engage in,
anywhere in the United States (the "Restricted Area"), the manufacture,
research, development, marketing or selling of a product, process or service
which competes with a product, process or service of Business on the date
hereof, or (ii) render services (including, without limitation, research,
development, marketing or sales) to any entity in competition with the Business,
in the Restricted Area, and shall not have a financial interest in any such
entity. For purposes of this Section 6.3 an entity is "in competition with the
Business" if it produces or distributes any product, or performs any service
which is directly competitive with the products of the Business on the date
hereof. The purchase and ownership by Cabot of an equity interest in any
business entity which is in competition with the Business, if the securities so
purchased or owned are traded or quoted on the National Association of
Securities Dealers Automated Quotation System or on any national stock exchange,
shall not in and of itself constitute a violation of this Section 6.3.
ARTICLE VII. CONDITIONS PRECEDENT TO CABOT'S OBLIGATIONS
All obligations of Cabot under this Agreement are subject to the
fulfillment and satisfaction, prior to or on the Closing Date, of each of the
following conditions, any one or more of which may be waived by Cabot.
7.1 Delivery of Cash. American shall have delivered to Cabot at the
closing sum of Two Million Dollars ($2,000,000) and delivered Five Hundred
Thousand Dollars ($500,000) to the client trust account of General Counsel
Associates as specified in Section 1.4 hereof. American shall have executed and
delivered the Escrow Agreement.
7.2 Opinion of Counsel of American. American shall have delivered to
Cabot at the closing an opinion dated as of the Closing Date of Murray D.
Fischer, P.C. of Beverly Hills, California, counsel to American that:
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(a) American is a valid existing general partnership in good standing
under the laws of the State of California.
(b) American has duly authorized, executed and delivered this
Agreement and the Escrow Agreement. This Agreement, the Escrow Agreement and
all related agreements are the valid and binding obligations of American and its
general partners, enforceable in accordance with their terms, except as
enforceability of the Agreement or any other agreement may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or affecting generally the enforcement of creditors' rights and except as the
remedy of specified performance may be unavailable in certain cases.
(c) The execution and delivery by American of this Agreement and all
related agreements, and consummation or the transactions contemplated thereby do
not conflict with or violate any provision of the partnership agreement of
American.
VIII. BULK SALES COMPLIANCE AND OTHER MATTERS
8.1 Cabot agrees fully to indemnify and hold American harmless from any
and all claims based on the failure of Cabot to comply with any requirement of
any bulk sales law. This provision shall survive the Closing.
8.2 Use of Name. Cabot covenants and warrants that it shall not sell any
products, place any advertising, or use any materials bearing the name Clear
Perfection, or otherwise use the Clear Perfection name, on or after the date of
the Closing, except in connection with returns.
8.3 Returns. American and Cabot agree that for a period of 90 days
following the Closing, Cabot shall be responsible for all Product returns on
Products sold prior to the Closing and Cabot shall reimburse any customer the
price at which the Product was sold to the customer returning it or reimburse
American for any such reimbursement made by American. At the end of each 30 day
period during the 90 day period Cabot shall deliver a certificate to the escrow
agent designated in the Escrow Agreement stating the dollar amount of the
refunds made to customers in connection with such returns during such period and
the escrow agent shall release a corresponding amount from the return fund as
contemplated in the Escrow Agreement. At the end of each 30 day period during
the 90 day period American shall deliver a certificate to the escrow agent
designated in the Escrow Agreement stating the dollar amount of the refunds made
to, or credits taken by, customers in connection with such returns during such
period, which refunds or credits were not reimbursed by Cabot and the escrow
agent shall release a corresponding amount from the Returns Fund as contemplated
in the Escrow Agreement. During such 90 day period, Cabot may refurbish any
returned Products or forward returned Products to American for refurbishing.
During such 90 period, American shall purchase from Cabot at customer cost all
finished goods returned to it or Cabot less American's reasonable costs of
refurbishing such Products. At the end of such 90 day period, American shall be
responsible for all
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Product returns, except returns on promotional Products sold by Cabot prior to
the Closing.
ARTICLE IX. GENERAL
9.1 Further Assurances. The parties hereto agree to execute and deliver
any and all papers and documents which may be reasonably necessary to carry out
the terms of this Agreement. The form and substance of all opinion and other
documents hereunder shall be satisfactory in all reasonable respects to Cabot
and its counsel and to American and its counsel. From and after the Closing,
Cabot agrees that any and all mail or phone calls it receives on behalf of the
Products and or assets will be immediately forwarded to American at its
California office address and that all inquiries from prospective customers will
be directed to American.
9.2 Entire Agreement. All schedules hereto shall be deemed to be accurate
as permitted and incorporated into and made a part of this Agreement. This
Agreement, together with the schedules hereto, contains the entire agreement
between the parties and there are no agreement, representations or warranties by
any of the parties hereto which are not set forth herein. This Agreement may
not be amended or revised except by a writing signed by both parties hereto.
9.3 Binding Effect: Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns; provided, however, that this Agreement and all rights hereunder may not
be assigned by American or Cabot, except by prior written consent of the other
party.
9.4 Separate Counterparts. This Agreement may be executed in several
identical counterparts, all of which when taken together shall constitute but
one instrument, and it shall not be necessary in any court of law to introduce
more than one executed counterpart in proving this Agreement.
9.5 Consistent Accounting. The parties to this Agreement shall consult
and cooperate with each other for the purpose of arriving at consistent
accounting, tax and reporting treatment, whether public or private, of the
transactions contemplated hereby, and for the purpose of preparing and filing
all requisite federal, state and local tax returns disclosing the consummation
of the transactions contemplated hereunder in a consistent manner.
9.6 Transactional Costs. Each party to this Agreement shall be
responsible for its own legal, accounting and other consulting services, if any,
attendant to the negotiation and drafting of this Agreement and to the
transactions contemplated by this Agreement.
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9.7 Notices. All notices hereunder, to be effective, shall be in writing
and shall be personally delivered or mailed by registered or certified mail,
postage and fees prepaid, to the party to be notified as follows:
(I) If to Cabot:
Cabot Laboratories, Inc,
16160 Caputo Drive, ,
Morgan Hill, California 95037
Attention: President
With copy to:
General Counsel Associates
1891 Landings Drive
Mountain View, California 94043
Attention: John Montgomery
(ii) If to American:
Mr. Zvi Ryzman
American International Industries
2220 Gasper Avenue
Los Angeles, CA 90040
With copy to:
Murray D. Fischer, Esq., P.C.
433 North Camden Drive, Suite 888
Beverly Hills, CA 90210
Unless and until notice of another or different address shall be given as
provided herein.
9.8 Severability. The provisions of this Agreement are severable, and the
invalidity of any provision shall not affect the validity of any other
provision.
9.9 Captions. The captions herein have been inserted solely for
convenience of reference and in no way define, limit or describe the scope or
substance of any provision of this Agreement.
9.10 The term "due inquiry" as used throughout this Agreement shall be
deemed to mean, in the case of inquiry by Cabot or its counsel, inquiry of
appropriate officers of Cabot
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only, and in the case of such inquiry by American or its counsel, inquiry of
appropriate general partners and officers of corporate general partners of
American only.
9.11 Gender. All pronouns used herein shall include both the masculine and
feminine gender as the context requires.
9.12 Governing Law. The execution, interpretation and performance of this
Agreement shall be governed by the laws of the State of California.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first set forth above.
CABOT LABORATORIES, INC.
By: ________________________
Title: President
AMERICAN INTERNATIONAL INDUSTRIES
By: ________________________
Title: General Partner
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