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
Date of Report (Date of earliest event reported): MAY 31, 1995
ARTISTIC GREETINGS INCORPORATED
(Exact Name of Registrant as specified in its Charter)
DELAWARE 0-7513 16-0909929
(State or other (Commission (IRS Employer
jurisdiction File Number) Identification No.)
of incorporation)
ONE KOMER CENTER, ELMIRA, NEW YORK 14902
(Address of Principal Executive Offices)
Telephone Number, including area code: (607) 737-5235
Former name or former address, if changed since last report:
Not Applicable.
<PAGE>
ITEM 5.OTHER EVENTS.
On May 31, 1995, Artistic Greetings Incorporated (the "Company")
purchased various assets from Valcheck Company ("Valcheck"), a subsidiary
of Valassis Communications, Inc., related to Valcheck's manufacture and
direct mail marketing and sale of checks (its "mail order check business").
Under the terms of the Purchase Agreement governing this transaction, the
Company purchased Valcheck's customer lists, machinery and equipment,
inventory and artwork related to Valcheck's mail order check business, and
assumed the obligation to fulfill Valcheck's current check orders and check
orders received by Valcheck after closing. In consideration for the assets
purchased, the Company: (1) issued to Valcheck 500,000 shares of the
Company's Common Stock, par value $.10 per share, pursuant to the terms of
a related Investment Agreement between the Company and Valcheck; and (2)
agreed to pay Valcheck 20% of the revenues it receives, less certain
adjustments, for both the existing check orders it assumed the obligation
to fulfill for Valcheck as well as for all first-time check orders Valcheck
receives within one year following the closing date of this transaction.
Under the terms of the Investment Agreement, the Company has granted
Valcheck a put option which calls for the Company, at Valcheck's option, to
repurchase up to all of these shares at the end of two years following the
closing date of this transaction at a price of $5.00 per share. The
closing price of the Company's Common Stock in Nasdaq trading on May 31,
1995 was $3.75 per share. The Investment Agreement also provides that, so
long as Valcheck controls at least 300,000 of the shares, Valcheck will
have the right to designate one representative as a member of the Company's
Board of Directors, and that so long as Valcheck controls any of the
shares, it will vote all such shares in accordance with the recommendations
made by the Company's Board of Directors with respect to any matters put
before the Company's shareholders for action. The Company's shares issued
to Valcheck in this transaction are "restricted securities" within the
meaning of Rule 144 under the Securities Act of 1933, as amended (the
"Act"), and can only be disposed of in an offering registered under that
Act or in a transaction exempt from registration thereunder.
Both the Purchase Agreement and the Investment Agreement are filed as
exhibits to this Report.
ITEM 7.FINANCIAL STATEMENTS AND EXHIBITS.
(c) EXHIBITS. See Exhibit Index.
<PAGE>
SIGNATURES
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 thereunto duly authorized.
ARTISTIC GREETINGS INCORPORATED
(Registrant)
Date: June 15, 1995 By: /S/ WILLIAM D. BANFIELD
William D. Banfield, Controller
<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION PAGES
4-1 Investment Agreement between Valcheck Company
and Artistic Greetings Incorporated, dated May 30, 1995
10-1 Purchase Agreement among Artistic Greetings
Incorporated, Valcheck Company and Valassis
Communications, Inc., dated May 30, 1995
EXHIBIT 4-1
INVESTMENT AGREEMENT
This Agreement is by and between ARTISTIC GREETINGS INCORPORATED, a
Delaware corporation, with an address of One Komer Center, Elmira, New York
14902 (the "Company"), and Valcheck Company, a Delaware general partnership
with an address of 401 Exchange Drive, Arlington, Texas 76011 ("Valcheck").
WHEREAS, pursuant to an Asset Purchase Agreement of even date herewith
among the Company, Valcheck and Valassis Communications, Inc., the Company
is purchasing certain assets from Valcheck; and
WHEREAS, as part of the consideration for the transactions
contemplated in the Asset Purchase Agreement, the Company will issue to
Valcheck 500,000 shares of the Company's Common Stock, par value $.10 per
share (the "Shares");
NOW, THEREFORE, for good and valuable consideration, receipt of which
is hereby acknowledged, the parties hereto agree as follows:
1) INVESTMENT INTENT. Valcheck is acquiring the Shares for investment
purposes, for its own account and not with a view to, or for resale in
connection with, any distribution of the Shares.
2) DUE DILIGENCE. Valcheck has received the Company's Form 10-K
Report for its year ended December 31, 1994, its Form 10-Q for its quarter
ended March 31, 1995, its Proxy Statement for its 1995 Annual Meeting of
Shareholders and its 1994 Annual Report, and has had an opportunity to
discuss the Company, its business plans and prospects with the senior
management of the Company. Valcheck understands the financial risks
involved with this investment and has the financial ability to hold the
Shares for investment purposes.
3) RESTRICTED SECURITIES. Valcheck understands and acknowledges that
the Shares are being offered and sold to it pursuant to an exemption from
registration under the Securities Act of 1933 (the "Act") that depends upon
its representations contained in this Agreement and that the Company is
relying on such representations as a condition precedent to issuing the
Shares to it. Valcheck acknowledges and agrees that, since the Shares will
be "restricted securities" within the meaning of Rule 144 under the Act,
absent their registration for public sale or an exemption from the
registration requirements of the Act other than that provided by Rule 144,
it must hold the Shares a minimum of two years from their date of
acquisition before any of them may be sold under Rule 144, and that any
sales thereafter made by it under Rule 144 can only be made in limited
quantities and only under the terms and conditions of said Rule; and that
any other public resale of the Shares may require registration under the
Act or reliance upon an applicable exemption from registration. Valcheck
also understands that the Company is under no obligation to register the
Shares in the future.
4) TRANSFER RESTRICTIONS. Valcheck agrees that the Shares may not be
transferred, and that the Company shall not be required to register any
such transfer in its stock transfer records, unless and until the Company
shall have been informed of the proposed transfer and:
(a) A registration statement with respect to the Shares shall be
effective under the Act; or
(b) Valcheck has obtained an opinion of counsel, in form and
content satisfactory to the Company and its counsel, that such
transfer complies with an applicable exemption from the registration
requirements of the Act, together with such other documentation as
counsel for the Company may in its reasonable discretion require as a
condition precedent in order to make a determination that the transfer
will not involve a violation of the registration provisions of the
Act.
Valcheck agrees that appropriate legends may be placed on any
certificates delivered to it representing the Shares in order to give
notice of the transfer restrictions set forth in this Agreement.
5) REPURCHASE OPTION. At any time during the 30 day period beginning
on the second anniversary of the closing date of the transactions
contemplated under the Asset Purchase Agreement (the "Put Option Term"),
Valcheck shall have the right to require the Company to repurchase some or
all of the Shares at a price of $5.00 per share (the "Put Option"), and the
Company will repurchase the number of Shares designated by Valcheck in such
notice within 30 days following the Company's receipt of such request from
Valcheck. The Company shall take whatever action is necessary or
appropriate to ensure that any sale of the Shares by Valcheck to the
Company pursuant to the Put Option complies with the Act. The Put Option
shall not be transferable to any third party except to Valassis
Communications, Inc., DRB Holdings, Inc., and/or Valassis Direct Response,
Inc.
6) RIGHT OF FIRST REFUSAL. With respect to any sales of any of the
Shares made by Valcheck at any time, Valcheck hereby grants the Company a
right of first refusal to purchase such Shares being sold by it on the same
price and other terms as are applicable to any disposition contemplated by
Valcheck. If such Shares are to be sold in the public market, the Company
shall pay the Closing Price for the Company's Common Stock in trading on
the National Association of Securities Dealers Inc. ("NASD") Automated
Quotation System ("Nasdaq") National Market List on the date the notice of
such proposed disposition is received by the Company. If such shares are
to be sold in a transaction other than in the public market, the Company
shall pay the price agreed to in such transaction. Valcheck must give the
Company five days notice of such a proposed disposition, to which the
Company must respond within five days following its receipt of such notice
or the right of first refusal with respect to the specific disposition
contemplated shall automatically expire. This right shall specifically
survive the expiration of the Put Option Term indefinitely. Closing of the
purchase by the Company of any Shares it may determine to purchase through
the exercise of this right of first refusal shall take place within 15 days
following the date on which the Company at any time exercises this right.
7) BOARD REPRESENTATION; VOTING RIGHTS.
(a) BOARD REPRESENTATION. So long as Valcheck controls at least
300,000 of the Shares, it shall have the right to designate one
representative as a member of the Company's Board of Directors. Upon the
closing of the transactions contemplated hereby, the Company agrees to take
all actions necessary to expand the size of its Board by one and to fill
the vacancy created thereby by electing to its Board an individual named by
Valcheck and reasonably acceptable to the Company. Subject to the
foregoing, at each Annual Meeting of the Company's shareholders, the
Company agrees to nominate an individual named by Valcheck and reasonably
acceptable to the Company, for inclusion in the slate of Directors to be
nominated by the Company for election to its Board, and agrees to solicit
and vote all proxies received in favor of electing such individual to its
Board.
(b) VOTING OF SHARES. So long as Valcheck controls any of the Shares,
with respect to all matters that are put before the Company's shareholders
for a vote, whether at a meeting or by written consent, Valcheck agrees to
vote all such Shares in favor of the Company's slate of nominees for
election to its Board of Directors and in accordance with the Board's
recommendation with respect to all other matters, and Valcheck agrees that
the Company may enforce these rights by injunctive action in any court of
competent jurisdiction.
8) GENERAL.
(a) NOTICE. Any notice required or permitted hereunder shall be in
writing and shall be deemed to have been duly given (i) upon hand delivery,
or (ii) on the third day following delivery to the U.S. Postal Service as
certified mail, return receipt requested and postage prepaid, or (iii) on
the first day following delivery to a nationally recognized U.S. overnight
courier service, fee prepaid and return receipt or other confirmation of
delivery requested, or (iv) when telecopied or sent by facsimile
transmission. Any such notice shall be delivered to a party at its address
first set forth above, or at such other address as may be designated by one
party in a notice given to the other from time to time in accordance with
the terms of this paragraph.
(b) ASSIGNMENT. This Agreement may not be assigned in whole or in
part without the written consent of all parties.
(c) ENTIRE AGREEMENT; AMENDMENT. This Agreement, together with the
Asset Purchase Agreement, contains the entire understanding between the
parties hereto and supersedes any prior agreements, understandings,
discussions, or writings between the parties with respect to the subject
matter hereof. This Agreement may only be amended by a written document
signed by all parties hereto. There are no representations, warranties, or
obligations of any party not expressly contained herein.
(d) WAIVER. No waiver by any party of a breach of any term or
condition of this Agreement by any other party shall be effective unless in
writing and duly executed by the waiving party. No such waiver shall
constitute a waiver of any subsequent breach of the same or any other term
or condition of this Agreement.
(e) CONSTRUCTION. Should an occasion arise in which interpretation of
this Agreement becomes necessary, such construction or interpretation shall
not presume that the terms hereof be more strictly construed against one
party by reason of any rule of construction or authorship.
(f) DUPLICATE ORIGINALS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original. It shall not be
necessary in making proof of this Agreement to produce or account for more
than one of such counterparts.
(g) HEADINGS. The headings included herein are for convenience only
and do not constitute a portion of this Agreement and shall not be used in
any construction hereof.
(h) APPLICABLE LAW; SEVERABILITY. This Agreement shall be governed and
construed in accordance with the laws of the State of New York pertaining
to contracts made and to be wholly performed within such state, without
taking into account conflict of laws principles. If any provision
contained herein is held to be invalid or unenforceable, the validity and
enforceability of the remaining provisions shall not in any way be affected
or impaired.
(i) JURISDICTION AND VENUE. In the event that any legal proceedings
are commenced in any court with respect to any matter arising under this
Agreement, the parties hereto specifically consent and agree that the
courts of the State of New York and/or the Federal Courts located in the
State of New York shall have jurisdiction over each of the parties hereto
and over the subject matter of any such proceedings, and the venue of any
such action shall be in Monroe County, New York and/or the U.S. District
Court for the Western District of New York.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this agreement
as of the 30th day of May, 1995.
ARTISTIC GREETINGS INCORPORATED VALCHECK COMPANY
By: Valassis Direct Response, Inc.,
its Managing Partner
By: /s/ David C. Lee
By: /s/ Robert L. Recchia
Title: President and COO
Title: CFO and Treasurer
EXHIBIT 10-1
PURCHASE AGREEMENT
THIS AGREEMENT is made between VALCHECK COMPANY a Delaware general
partnership with its principal office located at 401 Exchange Drive,
Arlington, Texas 76011 ("Seller"), ARTISTIC GREETINGS INCORPORATED, a
Delaware corporation with its principal office located at One Komer Center,
Elmira, New York 14902-1999 ("Buyer") and VALASSIS COMMUNICATIONS, INC., a
Delaware corporation with its principal office located at 36111 Schoolcraft
Road, Livonia, Michigan 48150 (the "Valassis").
WHEREAS, Seller has heretofore operated a certain business known as
Check-itOut and engaged in the business of the manufacture and direct mail
marketing and sale of checks (the "Business"); and
WHEREAS, Seller desires to sell certain assets, properties and rights
now owned and held by it and used in connection with the operation of the
Business; and
WHEREAS, a wholly-owned subsidiary of Valassis owns 80% of the
partnership interests of Seller; and
WHEREAS, Buyer desires to purchase such assets, properties and rights
of Seller upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants hereinafter contained, the Parties hereto agree as
follows:
ARTICLE I
PURCHASE AND SALE
1.01 PURCHASE OF ASSETS. Seller agrees to sell, convey, transfer,
assign and deliver to Buyer, and Buyer agrees to purchase and accept,
subject to the terms and conditions and in reliance upon the
representations and warranties in this Agreement, on the date described in
Article V hereof (the "Closing" or the "Closing Date"), certain assets,
properties and rights of Seller as follows (the "Assets"):
<PAGE>
A. All of Seller's inventory wherever located, including raw
materials, work in process, finished goods and stock and supplies, as
summarized and described in SCHEDULE 1.01A hereto.
B. All of the machinery, equipment and tools owned by Seller,
located at the Business premises and used or useable in the Business,
including but not limited to the items listed and described in SCHEDULE
1.01 B hereto, and excluding all leased items.
C. All of Seller's intangible assets and records as they relate
to the Business as follows: Seller's trade names (including the name Check-
it-Out), trade secrets and know-how related to advertising and marketing,
artwork, 800 telephone numbers, customer lists, mailing lists, sales and
purchasing correspondence and records, data processing records, and all of
the operational books, records and data used by Seller in connection with
the Business.
D. (i) All of Seller's customer orders from Seller's customers
that are unfilled as of the Closing Date, and (ii) all customer orders
received by Seller after Closing.
E. All of Seller's contracts described in SCHEDULE 1.01 E.
Notwithstanding anything herein to the contrary, the following assets
shall not be transferred to Buyer: (i) all rights of insurance coverage
relating to the liabilities being retained by Seller after the Closing;
(ii) income tax records of Seller; (iii) all partnership records of Seller;
and (iv) the rights of Seller under this Agreement, the Investment
Agreement and the amounts payable to Seller thereunder.
1.02 ASSIGNMENT OF CONTRACTS. Seller agrees to assign to Buyer, and
Buyer agrees to assume and accept, all of Seller's right, title and
interest in and to and obligations under the customer orders described in
SECTION 1.01D and under the contracts described in SECTION 1.01E.
1.03 LIABILITIES. It is expressly understood and agreed that Buyer
does not, nor will it assume or become liable for, any of the liabilities
of Seller of any kind or nature at any time existing or asserted, whether
fixed, contingent or otherwise, including without limitation accounts,
notes and taxes payable, products liability or warranty claims, lease
obligations accrued prior to the Closing Date, salesmen's employment
commissions, union contracts, salaries, wages, severance or separation pay,
or vacation, profit sharing, retirement, pension, bonus, hospitalization or
other employee benefits or any unemployment or old age benefit taxes
relating to Seller's employees; PROVIDED, however, that Buyer shall perform
all of Seller's obligations from and after the Closing Date with respect to
the following (the "Assumed Obligations") (i) the customer orders and
contracts assumed pursuant to PARAGRAPH 1.02 hereof, and (ii) customer
orders filled by Seller prior to the Closing Date but for which Seller is
required after Closing either to correct and refill or to issue refunds.
1.04 PURCHASE PRICE. The aggregate purchase price to be paid by Buyer
to Seller for the Assets (the "Purchase Price") shall be as follows:
A. 500,000 shares of $.10 par value common stock (the "Shares")
of Buyer, to be purchased and held pursuant to an Investment Agreement to
be executed at Closing by Seller and Buyer, in the form of SCHEDULE 1.04
hereto ( the "Investment Agreement");
B. Plus 20% of the revenues received by Buyer from all customer
orders
(i) described in PARAGRAPH 1.01D(I); and (ii) that are first time orders
received within one year after the Closing Date, in each case that are
filled by Buyer pursuant to PARAGRAPH 1.02;
C. Less 80% of the purchase price of the correction orders
refilled by Buyer, and 100% of all refunds issued by Buyer, pursuant to
clause (ii) of PARAGRAPH 1.03; and
D. Less 80% of the purchase price of any customer orders
described in PARAGRAPH 1.01D, which Seller has forwarded to Buyer for
fulfillment without payment.
1.05 ALLOCATION OF PURCHASE PRICE. The Purchase Price shall be
allocated to the various portions of the Assets as set forth in SCHEDULE
1.05 hereto.
1.06 PAYMENT OF PURCHASE Price. The Purchase Price shall be paid or
evidenced by the delivery at and after the Closing of the following:
A. A certificate representing the Shares, fully executed by the
Seller and containing such restrictive legends as may be provided for in
the Investment Agreement.
B. Buyer shall account to Seller, as of the 15th and the last
day of each month for the first three (3) months after the Closing Date,
and thereafter as of the last day of each month, for the amounts payable to
and owed by Seller pursuant to SECTION 1.04B, 1.04C AND 1.04D. Such
accounting shall show (i) regarding orders with respect to which payment is
due pursuant to PARAGRAPH 1.04B, the number of all existing and new
customer orders filled by Buyer during the period accounted for, the amount
of the purchase price received by Buyer with respect thereto, the 20% of
such amount received to be credited to Seller, and the 80% of any purchase
price not received by Buyer to be credited to Buyer; (ii) the number of
correction orders refilled by Buyer, the purchase price thereof, and the
80% of such Purchase Price to be credited to Buyer; and (iii) the amount of
all refunds issued by Buyer. Each reconciliation will be accompanied by
either Buyer's check payable to Seller for the net amount due Seller, or an
invoice from Buyer to Seller for the net amount due Buyer. Any net amount
due Buyer shall be paid within fifteen (1 5) days of receipt of the invoice
by Seller.
1.07 RIGHT OF OFFSET. Buyer may, at its option, use part or all of
any amounts due Seller or Valassis pursuant to the terms of this Agreement,
the Advertising Agreement (as defined in PARAGRAPH 6.05G below), or the
Investment Agreement to apply against or satisfy any failure of Seller or
Valassis to satisfy any of its obligations or agreements hereunder, whether
due to the breach of any representation or warranty made hereunder or
otherwise, together with all expenses, including reasonable attorneys' fees
and the costs of defense, incurred by Buyer as a result of or in connection
therewith; and, if so used by Buyer, such amounts shall be, and shall
constitute, a complete and absolute offset against any such payments which
are or may become due from Buyer to Seller or Valassis pursuant to the
terms of this Agreement, the Advertising Agreement or the Investment
Agreement. Nothing contained in this PARAGRAPH 1.07 shall be construed so
as to limit or modify, except to provide for a right of offset, Seller's
and Valassis' general obligation to indemnify Buyer set forth in PARAGRAPH
4.05 hereof. Prior to exercising any right of offset pursuant to this
Paragraph, Buyer shall provide written notice of any claim on which Buyer
intends to base such right and shall negotiate in good faith with Seller or
Valassis in attempting to resolve such claim, but Buyer shall not be
required to continue such negotiations beyond 30 days after the date on
which it notifies Seller or Valassis of such claim.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF
SELLER AND VALASSIS
Seller and Valassis jointly and severally represent and warrant to
Buyer as follows:
2.01 CORPORATE STANDING. Seller is a general partnership existing
under the laws of the State of Delaware, and Valassis is a corporation,
duly organized, validly existing and in good standing under the laws of the
State of Delaware.
2.02 CORPORATE STRUCTURE. Valassis Direct Response, Inc., a Delaware
corporation which is a wholly-owned subsidiary of Valassis, ("VDR") owns an
80% partnership interest of Seller, and DRB Holdings, Inc., a Texas
corporation, ("DRB") owns a 20% partnership interest in Seller. Seller
does not have any outstanding options or warrants to purchase, or contracts
to issue, or contracts or any other rights or commitments entitling anyone
other than VDR or DRB to acquire, an additional partnership interest in the
Seller.
2.03 CORPORATE AUTHORITY. Seller has full partnership power and
authority to enter into this Agreement, to sell, transfer and deliver the
Assets, and to perform all of its obligations contained herein and in the
Investment Agreement and in all other documents to be executed pursuant
hereto; and Valassis has full corporate power and authority to enter into
this Agreement and the Advertising Agreement, and to perform all of its
obligations set forth herein and therein. Seller and Valassis have taken
all such partnership and corporate action as may be necessary or advisable
and proper to authorize respectively this Agreement, the Investment
Agreement and the Advertising Agreement, the execution and delivery hereof
and thereof, the consummation of the transactions contemplated hereby and
thereby and the execution and delivery of each of the documents required to
be delivered hereunder and thereunder; so that each of Seller and Valassis,
as the case may be, have full right, power and authority to sell and
deliver the Assets to Buyer and to perform all of its obligations under
this Agreement, the Investment Agreement and the Advertising Agreement.
2.04 ABSENCE OF RESTRICTIONS. Except as set forth in SCHEDULE 2.04,
Seller has made no other agreement with any other party with respect to the
sale or encumbrance of the Assets. Except as set forth in SCHEDULE 2.04,
the execution and delivery of this Agreement, and the consummation of the
transactions provided hereunder, does not require any third party consent
(other than the consent of VDR and DRB) and does not violate, conflict
with, result in the breach of, or cause the acceleration of or default
under any provision of (a) Seller's Joint Venture Agreement, as the same
may have been amended from time to time or (b) any obligation, mortgage,
lien, lease, agreement, instrument, law, order, arbitration award,
judgment, decree or any other restriction to which Seller is a party or by
which Seller is subject or bound.
2.05 TITLE TO ASSETS. Except as set forth in SCHEDULE 2.05 hereto,
Seller has good and marketable title to all of the Assets, free and clear
of all liabilities, mortgages, conditional sales agreements, security
interests, leases, liens, pledges, encumbrances, restrictions, charges,
claims or imperfections of title whatsoever, so that Buyer shall, after
consummation of the transactions contemplated hereunder, be free to
utilize, sell or otherwise dispose of all of the Assets in whatever manner
and at whatever locations Buyer may desire.
2.06 FIXED ASSETS. SCHEDULE 1.01B hereto contains a list or
description of all machinery, equipment and tools owned by Seller and sets
forth the basis and manner by which said Assets have been depreciated. All
of such Assets are in good working condition and useable in the ordinary
course of the Business. No such Asset included in Seller's financial
statements or records has been valued in excess of its cost less
accumulated depreciation as of March 31, 1995.
2.07 LNVENTORY. All of Seller's inventory included in the Assets and
the location thereof is shown on SCHEDULE 1.01A, is useable or saleable in
the ordinary course of the Business, and is in a quantity and of a quality
suitable for sale in the ordinary course of the Business. Said inventory
has a value, at the lower of cost or market, on a first in/first out basis,
in excess of $300,000.
2.08 CONTRACTS. The customer orders described in PARAGRAPH 1.01D(I)
and the contracts referred to in SECTION 1.01E are either in full force and
effect or are offers which have not been cancelled; Seller has not violated
any of the terms thereof in any material respect; no claim has been made by
any party thereto that Seller is in default thereunder or in violation of
any law, rule or regulation related thereto; and Seller has received no
notice that any such order or contract is being or will be cancelled. Each
of such orders and contracts is assignable to Buyer and neither such
assignment nor the consummation of any of the transactions contemplated by
this Agreement will result in a default under or termination of any such
order or contract. Full and complete copies of each of such orders and
contracts have been supplied by Seller to Buyer on or prior to the date
hereof, and there have been no subsequent changes in such orders or
contracts.
2.09 TRADEMARKS, TRADENAMES, ETC. Except as set forth in SCHEDULE
2.09 hereto, Seller owns no trademarks or trade names, nor does it have any
applications pending with respect thereto, nor does Seller utilize any
assumed names, nor is Seller a party to any trademark license agreement;
and the ability of the Buyer to discharge the Assumed Obligations, does not
require the ownership or use of any trademark, trade name or assumed name,
except as set forth in SCHEDULE 2.09 hereto. Seller is not a party to, nor
does Seller have any knowledge of, any trademark infringement litigation or
claim affecting or which might affect the Business or the ability of Buyer
to discharge the Assumed Obligations, or any basis for any such claim.
2.10 TAXES. Seller has filed returns for and paid in full all of its
federal, state and local taxes to the extent such filings and payments are
required prior to the date of this Agreement. All such returns were true
and correct in all material respects when filed.
2.11 LITIGATION AND CLAIMS. There is no litigation, proceeding, suit,
action, controversy or claim in law or in equity (including proceedings by
or before any governmental board or agency) existing, pending or, to the
best of Seller's knowledge, threatened against Seller which might adversely
affect Buyer's purchase or use of the Assets, or Buyer's ability to
discharge the Assumed Obligations, and there is no fact known to Seller
which could form the basis for any such litigation, proceeding, suit,
action, controversy or claim. There are no judgments, orders, laws or
regulations existing, whether or not filed, against Seller which might
affect the Assets and Buyer's purchase thereof or Buyer's ability to
discharge the Assumed Obligations.
2.12 GOVERNMENTAL COMPLIANCE. Seller has complied in all material
respects with all applicable laws, rules, regulations and orders of all
federal, state and local authorities with respect to the Business and the
Assets. Seller has not received any notice that it is claimed to be in
default with respect to any judgment, order, injunction, decree, rule or
regulation of any court, administrative agency or other governmental
agency. All reports, returns and other documents which have been filed by
Seller with any administrative agency or governmental authority are true,
correct and complete in all material respects.2.13CUSTOMER FILES. All
Seller's customer files as they exist on the date hereof, including, all
information contained therein regarding inquiries from customers and
potential customers, all computer records and data, and hard copies of all
customer orders received by Seller since it commenced business that are in
Seller's possession, have been delivered to Buyer; and the customer files
so delivered contain the names of not less than 750,000 customers as of the
date hereof.
2.14 INVESTMENT AGREEMENT. All of the representations and warranties
of the Seller set forth in the Investment Agreement are true and complete
and are incorporated herein by reference.
2.15 GENERAL WARRANTY. No representation or warranty of Seller or
Valassis contained or incorporated in this Agreement, nor any Schedule,
statement or certificate furnished to or to be furnished by Seller to Buyer
pursuant to the terms hereof, or in connection with the transactions
contemplated hereby, contains or will contain any untrue statement of a
material fact, or fails or will fail to state a material fact necessary to
make the statements contained or incorporated therein or herein not
misleading.
<PAGE>
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller and Valassis as follows:
3.01 CORPORATE STANDING. Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Delaware. Buyer has full corporate power and authority to own its
properties and to carry on its business as currently
conducted.
3.02 CORPORATE AUTHORITY. Buyer has full corporate power and
authority to enter into this Agreement, and to purchase the Assets and to
issue the Shares as provided in this Agreement, and to enter into the
Investment Agreement and the Advertising Agreement. Buyer has taken all
such corporate action as may be necessary or advisable and proper to
authorize this Agreement, the Investment Agreement and the Advertising
Agreement, the execution and delivery hereof and thereof, the consummation
of the transactions contemplated hereby and thereby and the execution and
delivery of each of the documents required to be delivered hereunder and
thereunder, so that Buyer will have full right, power and authority to
purchase the Assets from Seller and to issue the Shares as provided in this
Agreement, and to perform all of its obligations under this Agreement, the
Investment Agreement and the Advertising Agreement.
3.03 CONSENTS. The execution of this Agreement, the Investment
Agreement and the Advertising Agreement by Buyer and its consummation of
the transactions contemplated hereby and thereby do not require the consent
of any third party and do not violate, conflict with, result in the breach
of, or cause the acceleration of or default under any provision of (a)
Buyer's Certificate of incorporation and By-laws, as the same may have been
amended from time to time or (b) any obligation, mortgage, lien, lease,
agreement, instrument, law, order, arbitration award, judgment, decree or
any other restriction to which Buyer is a party or by which Buyer is
subject or bound.
3.04 LITIGATION AND CLAIMS. There is no litigation, proceeding, suit,
action, controversy or claim in law or in equity (including proceedings by
or before any governmental board or agency) existing, pending or, to the
best of Buyer's knowledge, threatened against Buyer which might adversely
affect Buyer's purchase or use of the Assets, or Buyer's ability to
discharge the Assumed Obligations and to perform its other obligations
under this Agreement, the Investment Agreement and the Advertising
Agreement, and there is no fact known to Buyer which could form the basis
for any such litigation, proceeding, suit, action, controversy or claim.
There are no judgments, orders, laws or regulations existing, whether or
not filed, against Buyer which might affect the Assets and Buyer's purchase
thereof or Buyers ability to discharge the Assumed Obligations and to
perform its other obligations under this Agreement, the Investment
Agreement and the Advertising Agreement.
3.05 GENERAL WARRANTY. No representation or warranty of Buyer
contained or incorporated in this Agreement, nor any statement or
certificate furnished or to be furnished to Seller or Valassis by Buyer
pursuant to the terms hereof, or in connection with the transactions
contemplated hereby, contains or will contain any untrue statement of a
material fact, or fails or will fail to state a material fact necessary to
make the statements contained or incorporated therein or herein not
misleading.
3.06 COMPLIANCE WITH REPORTING OBLIGATIONS. Buyer has timely filed
all reports and other documents required to be filed by it under Sections
13,14, and 15(d) of the Securities Exchange Act of 1934, as amended
(collectively, the "Reports"). No such Reports (i) contain any statement
which was at the time and in light of the circumstances under which it was
made, false or misleading with respect to any material fact, or (ii) omit
to state any material fact necessary in order to make the statements
therein not false or misleading.
3.07 CAPITALIZATION AND SHARES. Buyer's authorized capital stock
consists of 10,000,000 shares of common stock $.10 par value, of which
5,821,293 shares were issued and outstanding as of May 12, 1995. On
delivery of a certificate representing the Shares at Closing pursuant to
this Agreement, the Shares will be duly and validly authorized and issued,
fully paid and non- assessable.
<PAGE>
ARTICLE IV
FURTHER COVENANTS OF SELLER, VALASSIS AND BUYER
4.01 SELLER AND VALASSIS. Seller and Valassis jointly and severally
further covenant and agree as follows:
A. CONDUCT OF Business. To conduct the Business pending the
Closing in the normal and usual manner consistent with past practice and,
without the prior approval of Buyer (which approval may be withheld by
Buyer for any reason in its sole discretion); not to make any change which
materially adversely affects the policies relating to the operation and
conduct of the Business; and not to commence negotiations for, or enter
into, any material or unusual contracts or agreements affecting the
Business or the Assets, or extending beyond the Closing that will have a
material and adverse effect on the Assets, or the Buyer's ability to
purchase the Assets and to discharge the Assumed Obligations.
B. RETENTION OF BUSINESS. To use and exert best efforts
between the date hereof and Closing to keep and retain the Business as a
going business and to provide such assistance and cooperation as may be
requested or necessary to assure the orderly transfer of the Assets to
Buyer and the discharge of the Assumed Obligations by Buyer subsequent to
the Closing.
C. CHANGES. Between the date hereof and the Closing, to notify
Buyer of any unusual changes, problems or developments with respect to the
Business and the status of Seller's liabilities, obligations and
relationships with its customers.
D. LIABILITIES. To pay and discharge, or make adequate
provision for the payment and discharge of, all of Sellers liabilities,
indebtedness, obligations, claims and losses not specifically assumed by
Buyer in this Agreement, as they become due and payable.
E. ACCESS. To allow the authorized personnel and agents of
Buyer to have access to any and all of the records and premises of Seller
at all reasonable times between the date hereof and the Closing; to furnish
Buyer with all information concerning
<PAGE>
Seller's affairs as Buyer may reasonably request; and to permit Buyer to
make extracts from, and copies of, all of Seller's books, records, files,
customer orders, and other Business records and, for a period of nine
months subsequent to the Closing, to make Ken Teeter, or other individuals
able to assist with the issues at hand at the time, available to Buyer at
Buyer's request for consultation and advice concerning the Assets and
Buyers discharge of the Assumed Obligations.
F. INDEMNIFICATION. To fully indemnify and hold harmless
Buyer, its directors, officers, agents, employees, successors and assigns,
as applicable, from and against and in respect of any and all liabilities,
obligations, damages, losses and expenses, including claims of every kind
and nature, whether accrued, absolute, contingent or otherwise, and
including reasonable attorneys' fees and the costs of defense, incurred by
any of them as a result, or by reason, of the breach, falsity or failure of
any of Seller's or Valassis' representations, warranties, covenants or
undertakings contained in this Agreement, the Investment Agreement or the
Advertising Agreement, including without limitation, any claims arising by
reason of the failure of Seller to comply with any "Bulk Transfer"
provisions of the Uniform Commercial Code as enacted and presently in
effect in the State of Texas; it being agreed by the parties that the
provisions of this indemnification shall survive the Closing Date and may
be enforced by Buyer's offset against any payments due to Seller or
Valassis pursuant to the provisions of PARAGRAPH 1.07 hereof without
limiting in any respect any and all other rights which Buyer may have
against Seller and Valassis, in law or in equity, to enforce the provisions
hereof. Buyer shall give notice to Seller and Valassis promptly after
Buyer has actual knowledge of any claim as to which indemnity may be
sought, and shall permit Seller and Valassis (at their joint and several
expense) to assume the defense of any claim or any litigation resulting
therefrom, provided that all counsel who shall conduct the defense of such
claim or litigation on behalf of the indemnitees shall be reasonably
satisfactory to Buyer, and shall not have any material conflict of interest
in representing all indemnitees involved in such claim or litigation.
Buyer may participate in such defense, but only at Buyers expense.
G. COOPERATION. To execute, acknowledge and deliver to Buyer
on demand, both prior and subsequent to the Closing, all such instruments,
consents, authorizations, certifications, books, records and data, and to
take all other action, as heretofore agreed or as may be reasonably
necessary or advisable in the opinion of Buyer to satisfy the Conditions to
Closing by Buyer contained in ARTICLE VI hereof, to effectuate the
provisions and intent of this Agreement, including, without limitation,
Buyer's discharge of the Assumed Obligations and to better assign, transfer
and convey title and possession of the Assets to Buyer; and further to
assist and cooperate with Buyer in connection with any litigation involving
the Business or the Assets. In furtherance, but not in limitation, of the
foregoing:
(i) Seller agrees to instruct the U.S. Post Office to
forward all of Seller's mail relating to the Business to Buyer and agrees
to forward to Buyer daily any customer orders otherwise received by Seller
after the Closing Date, including both the purchase orders and any checks,
money orders or other form of payment, in the form received. The same
shall be forwarded to Buyer, at Buyers expense, on the day of receipt by
overnight delivery, using a carrier reasonably acceptable to Buyer and
Seller. Seller hereby authorizes Buyer to indorse Seller's name and take
all other action necessary to indorse and process any checks, money orders,
credit card vouchers or other forms of payment, in order that Buyer can
deposit such payments to Buyer's account; and
(ii) With regard to Seller's customer files described in
SECTION 1.01C (a) Seller agrees to use its best efforts and to cooperate
with Buyer, to obtain delivery from Response Media Products, Inc.
("Response"), in computer readable form, of all information contained in
all of Response's data files regarding Seller's check customers, and (b) to
cooperate to assist Buyer to extract from Seller's customer file database
all information contained therein.
H. NONCOMPETITION. For a period of five (5) years from and
after the Closing Date: not to engage or compete, directly or indirectly,
as a principal, on its own account, or as a shareholder, agent, officer,
director, partner or joint venturer in any corporation or business entity,
in any business engaged in the manufacturer of checks and/or direct mail
marketing of checks and/or the direct mail sale of checks from, at or into
the United States; nor within the same area to extend credit, lend money,
furnish quarters or give advice to any such business or proposed business
entity; nor without the consent of the Buyer, directly or indirectly
discuss, publish or otherwise divulge any information regarding the
Business or its methods of operation, unless such information is publicly
known, other than by reason of a violation of this Agreement by Seller or
Valassis, PROVIDED that nothing contained herein shall be construed as
preventing the investment in corporate securities which are traded on a
recognized stock exchange. If any of the restrictions on post-Closing
competitive activities contained in this PARAGRAPH 4.01H shall for any
reason be held by a court of competent jurisdiction to be excessively broad
as to duration, geographical scope, activity or subject, such restrictions
shall be construed so as thereafter to be limited or reduced to be
enforceable to the extent compatible with the applicable law as it shall
then appear; it being understood that by the execution of this Agreement
the parties hereto regard such restrictions as reasonable and compatible
with their respective rights.
4.02 BUYER. Buyer further covenants and agrees to fully indemnify and
hold harmless each of Seller and Valassis, and the directors, officers,
agents, employees, successors and assigns of each, as applicable, from and
against and in respect of any and all liabilities, obligations, damages,
losses and expenses, including claims of every kind and nature, whether
accrued, absolute, contingent or otherwise, and including reasonable
attorneys' fees and the costs of defense, incurred by any of them as a
result, or by reason, of the breach, falsity or failure of any of Buyer's
representations, warranties, covenants or undertakings contained in this
Agreement, the Investment Agreement or the Advertising Agreement, it being
agreed by the parties that the provisions of this indemnification shall
survive the Closing Date and may be enforced by Seller's and Valassis'
offset against any payments due to Buyer pursuant to the provisions of this
Agreement, the Investment Agreement or the Advertising Agreement, without
limiting in any respect any and all other rights which Seller and Valassis
may have against Buyer, in law or in equity, to enforce the provisions
hereof. Seller and Valassis shall give notice to Buyer promptly after
either has actual knowledge of any claim as to which indemnity may be
sought, and shall permit Buyer to assume the defense of any claim or any
litigation resulting therefrom, provided that all counsel who shall conduct
the defense of such claim or litigation on behalf of the indemnitees shall
be reasonably satisfactory to Seller or Valassis, as the case may be, and
shall not have any material conflict of interest in representing all
indemnitees involved in such claim or litigation. Each of Seller and
Valassis may participate in such defense, but only at its own expense.
ARTICLE V
CLOSING
Closing hereunder shall take place at the office of Jenkins &
Gilchrist at 1445 Ross Avenue, Suite 3200, Dallas, Texas, on May 30, 1995,
or at such other time and place as Seller and Buyer may subsequently agree
in writing.
ARTICLE VI
CONDITIONS OF CLOSING BY BUYER
The obligation of Buyer to consummate the transactions contemplated by
this Agreement shall be subject, at Buyer's sole option, to the
satisfaction of the following conditions precedent:
6.01 REPRESENTATIONS. All of the representations and warranties of
Seller and Valassis herein contained or incorporated herein shall be true
and correct as of the date of this Agreement, and as of the Closing Date as
if expressly made on and as of the Closing Date.
6.02 PERFORMANCE OF COVENANTS. All of the covenants to be performed
and all of the conditions to be satisfied by Seller and Valassis prior to
the Closing Date shall have been performed or satisfied on or before the
Closing.
6.03 BOOKS AND RECORDS. Seller shall have delivered to Buyer on or
before the Closing Date all of Seller's operational books, records, data
and materials included among or related to the Assets or which are or would
be necessary or useful to Buyer in exercising ownership of the Assets or in
discharging the Assumed Obligations, expressly EXCLUDING, however, the
excluded assets listed in SECTION 1.01 but expressly INCLUDING all of
Seller's customer and sales records and all of the other documents referred
to in this Agreement.
6.04 CONDITION OF PROPERTY. All of the Assets shall be in the same
condition on the Closing Date as the same are as of the date hereof,
ordinary wear and tear alone excepted, it being understood and agreed
between the Parties hereto that any destruction, loss or damage by fire or
casualty prior to the Closing which exceeds One Thousand Dollars ($1,000)
or which could result in a substantial disruption of Buyers exercising
ownership of the Assets or in discharging the Assumed Obligations shall
constitute a failure of the condition precedent set forth herein.
6.05 DELIVERY OF DOCUMENTS. Buyer shall have received all such
documents, certificates, opinions and papers required of Seller pursuant to
the terms of this Agreement, or which shall have been reasonably requested
by Buyer in connection therewith, in form and substance as approved prior
to the Closing by Underberg & Kessler, attorneys for Buyer, including
expressly, but not limited to, possession of all of the Assets and the
following:
A. Duly executed warranty Bills of Sale, Assignments and
instruments of transfer and assignment of the Assets.
B. Duly executed assignments of Seller's customer orders and
the contracts referred to in PARAGRAPH 1.02.
C. A certificate of Seller executed by VDR and DRB, as
venturers of Seller, sufficient to authorize Sellers execution of this
Agreement, its consummation of the transactions contemplated hereby and its
execution and delivery of the documents required to be delivered hereunder.
A certificate of resolutions adopted by Valassis' Board of Directors
authorizing the execution of this Agreement and the Advertising Agreement,
the consummation of the transactions contemplated hereby and thereby and
the execution and delivery of the documents required to be delivered
hereunder and thereunder, appropriately certified by Valassis' Chief
Financial Officer.
D. A certificate dated as of the Closing Date, to the effect
that, as of the Closing Date, all of the representations and warranties of
Seller and Valassis contained in this Agreement and the Schedules hereto
are true and correct and that all of the covenants and conditions contained
in this Agreement to be performed or satisfied by Seller prior to the
Closing have been performed or satisfied, such certificate to be executed
by Seller's Managing Venturer and by Valassis.
E. A written opinion of McDermott, Will & Emery, attorneys for
Seller, dated as of the Closing Date, in form and substance satisfactory to
Buyer, in the form of SCHEDULE 6.05E.
F. An Advertising Agreement duly executed by Valassis in the
form of SCHEDULE 6.05F (the "Advertising Agreement") hereto.
G. A Investment Agreement duly executed by Seller, in the form
of SCHEDULE 1.04 hereto (the "Investment Agreement").
ARTICLE VII
CONDITIONS OF CLOSING BY SELLER AND VALASSIS
The obligation of Seller and Valassis to consummate the transactions
contemplated by this Agreement shall be subject, at Seller's sole option,
to the satisfaction of the following conditions precedent:
7.01 REPRESENTATIONS. All of the representations and warranties of
Buyer herein contained shall be true and correct as of the date of this
Agreement, and as of the Closing Date as if made on and as of the Closing
Date.
7.02 COVENANTS AND CONDITIONS. All of the covenants to be performed
and all of the conditions to be satisfied by Buyer prior to the Closing
Date shall have been performed or satisfied on or before the Closing.
7.03 DELIVERY OF DOCUMENTS. Seller shall have received all such
documents, certificates, opinions and papers required of Buyer pursuant to
the terms of this Agreement, or which shall have been reasonably requested
by Seller in connection therewith, in form and substance as approved prior
to the Closing by McDermott, Will & Emery, attorneys for Seller, including
expressly, but not limited to, the following:
A. A certificate of resolutions adopted by Buyer's Board of
Directors authorizing the execution of this Agreement, the Investment
Agreement (and the issuance of the Shares pursuant thereto) and the
Advertising Agreement, the consummation of the transactions contemplated
hereby and thereby and the execution and delivery of the documents required
to be delivered hereunder and thereunder, appropriately certified to Seller
and Valassis by Buyer's corporate Secretary.
B. A written opinion of Messrs. Underberg & Kessler, attorneys
for Buyer, dated as of the Closing Date, in form and substance satisfactory
to Seller, in the form of
SCHEDULE 7.03B.
C. The Advertising Agreement duly executed by Buyer.
D. The Investment Agreement duly executed by Buyer.
E. A certificate dated as of the Closing Date, to the effect
that, as of the Closing Date, all of the representations and warranties of
Buyer contained in this Agreement are true and correct and that all of the
covenants and conditions contained in this Agreement to be performed or
satisfied by Buyer prior to the Closing have been performed or satisfied,
such certificate to be executed by Buyer's President and Secretary.
ARTICLE VIll
CONTINGENT FINANCIAL MATTERS
8.01 TAX STATUS AND EFFECT. It is understood and agreed that neither
Seller nor Valassis, on the one hand, nor Buyer, on the other, has or have
made any representations to each other as to the tax status or tax effect
of the transactions contemplated by this Agreement, and each of the parties
is therefore separately taking counsel as to such matters and each is
assuming, subject only to the express and specific provisions of this
Agreement, the tax, if any, which may be incurred by reason of the carrying
out of the terms and provisions hereof.
<PAGE>
8.02 SALES OR USE TAX. In the event that any sales or use tax shall
be due to any state or local governmental authority by reason of the sale
of the Assets, such tax shall be borne by Buyer and Seller equally.
8.03 BROKERAGE COMMISSIONS. Seller, Valassis and Buyer represent and
warrant, each to the other, that this Agreement and the transactions
contemplated hereunder were brought about without the assistance of any
broker, person or firm, and that no one is entitled to a commission, fee or
payment of any kind relative to this Agreement or the transactions
contemplated hereby.
8.04 RISK OF LOSS. All risk of loss to the Assets shall remain in
Seller until the transfer of the Assets on the Closing Date. In the event
of any casualty or loss to the Assets prior to the Closing and Buyer elects
to consummate this transaction, Buyer may, at Buyer's option, either
require Seller at Closing to assign by specific assignment to Buyer all of
Seller's claims under and the proceeds of any and all insurance policies
(including proceeds received by Seller prior to Closing) as well as claims
against any third parties relating to such casualty or loss on the property
subject thereto or, alternatively, reduce the Purchase Price by the amount
of the loss and permit Seller to retain such claims and proceeds.
8.05 EXPENSES OF PARTIES. All expenses involved in the preparation,
authorization and consummation of this Agreement, including, without
limitation, all fees and expenses of agents, representatives, counsel and
accountants, shall be borne solely by the Party which shall have incurred
the same, and the other Party shall have no liability with respect thereto.
ARTICLE IX
MISCELLANEOUS PROVISIONS
9.01 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties contained in this Agreement shall survive the execution and
delivery of this Agreement and the transfer of the Assets for a period of
one year from the Closing Date, provided, however, that the representations
and warranties set forth in PARAGRAPHS 2.03,
2.04, 2.05, 2.11, 2.12, AND 2.14 shall survive indefinitely and those set
forth in Paragraph
2.08 shall expire at the end of two years after the Closing Date.
9.02 BENEFIT AND ASSIGNABILITY. This Agreement shall be binding upon
and inure to the benefit of the respective successors and assigns of Seller
and Buyer.
9.03 NOTICES. Any notice or other communication required or permitted
under this Agreement shall be in writing and shall be deemed to have been
duly given (i) upon hand delivery, or (ii) on the third day following
delivery to the U.S. Postal Service as certified or registered mail, return
receipt requested and postage prepaid, or (iii) on the first day following
delivery to a nationally recognized United States overnight courier
service, fee prepaid, return receipt or other confirmation of delivery
requested, or (iv) when telecopied or sent by facsimile transmission if an
additional notice is also given under (i), (ii) or (iii) above within three
days thereafter. Any such notice or communication shall be delivered or
directed to a party at its address set forth below or at such other address
as may be designated by a party in a notice given to all other parties
hereto in accordance with the provisions of this paragraph.
Notice to Seller or Valassis shall be sent to:Valassis Communications, Inc.
361 1 1 Schoolcraft Road
Livonia MI 48150
Attn:Barry P. Hoffman, Esq.
with a copy to:McDermott, Will & Emery
1211 Avenue of the Americas
New York, NY 10036
Attn: Mark Thoman, Esq.
<PAGE>
Notice to Buyer shall be sent to:Artistic Greetings Incorporated
One Komer Center
Elmira, NY 14905
Attn: Stuart Komer, Chairman
with a copy to:Underberg & Kessler
1800 Chase Square
Rochester, NY 14604
Attn: Michael C. Dwyer, Esq.
9.04 PUBLICITY AND CONFIDENTIALITY. No publicity shall be released by
any party prior to or after the Closing Date concerning the execution of
this Agreement and the transactions contemplated hereunder except with the
consent of the other parties. If for any reason the transactions provided
for hereunder shall not be consummated, each party (a) shall return all
confidential information which it received from any other party in the
course of investigating and negotiating the transactions provided for
hereunder and (b) shall not disclose to any third party any such
confidential information, except with the approval of the other party or as
required by law; PROVIDED, however, that this provision shall be applicable
only with respect to information which was clearly identified as
confidential by the furnishing party when originally submitted and (a) was
not then known or subsequently independently developed by the receiving
party, nor (b) subsequently rightfully obtained from a third party, nor (c)
then or subsequently publicly known or available otherwise than through the
improper conduct of the other party.
9.05 INTERPRETATION. This Agreement shall be construed and enforced in
accordance with the laws of the State of New York. The waiver by any party
of a breach of any provision of this Agreement must be in writing, and the
waiver of one breach shall not operate as, nor be construed as, a waiver of
any subsequent breach thereof. This Agreement represents the entire
agreement between the parties with respect to the transactions contemplated
hereby and may be modified only by a subsequent written document executed
by the parties. Throughout this Agreement, the masculine gender shall be
deemed to include the feminine and neuter, and the singular shall be deemed
to include the plural, and vice versa. The headings of the Articles and
Paragraphs of this Agreement are inserted for convenience only and do not
constitute a part of this Agreement. This Agreement may be executed in
several counterparts, each of which shall be deemed an original and all of
which shall constitute but one and the same instrument.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement on May 30, 1995.
BUYER:
ARTISTIC GREETINGS INCORPORATED
By: /S/ DAVID C.LEE
Its: President and COO
SELLER
VALCHECK COMPANY
By: Valassis Direct Response, Inc.
Its: Managing Venturer
By:/S/ ROBERT L. RECCHIA
Robert L. Recchia
Its: Chief Financial Officer
VALASSIS
VALASSIS COMMUNICATIONS, INC.
By: /S/ ROBERT L. RECCHIA
Robert L Recchia
Its: Chief Financial Officer
The Registrant agrees to furnish supplementally to the Commission a copy of
any omitted schedules or exhibits to this Agreement upon request.
