SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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) November 29, 1995
ASTRONICS CORPORATION
(Exact Name of Registrant as Specified in Charter)
New York 0-7087 16-0959303
(State or Other (Commission (IRS Employer
Jurisdiction File Number) Identification
of Incorporation) No.)
1801 Elmwood Avenue, Buffalo, New York 14207
(Address of Principal Executive Offices (Zip Code)
Registrant's telephone number, including area code (716) 447-9013
N/A
(Former Name or Former Address, if Changed Since Last Report)
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Item 2. Acquisition or Disposition of Assets
On November 29, 1995, the Company acquired the business
of Loctite Luminescent Systems, Inc., Lebanon, New Hampshire, a
wholly-owned subsidiary of Loctite Corporation, in an asset
transaction at a purchase price of approximately $6.5 million in
cash. The business acquired is engaged in the manufacture and
distribution of electroluminescent lamps, formation lights and
egress lighting systems. The business will be integrated into
the Company's E-L FlexKey Technologies, Inc. subsidiary and will
continue to be devoted to lighting products.
In connection with financing the acquisition, the
Company has restructured its existing debt with an $11 million
revolving line of credit from Fleet Bank, Buffalo, New York,
which was used, in part, to pay for the Loctite Luminescent
Systems acquisition and closing costs related to the transaction.
The credit facility provides that up to $9 million may be
converted to a term loan payable over four years. At the
Company's election, interest will be at the bank's prime rate or
a rate equal to LIBOR plus 1.25%. The loan facility is secured
by a pledge of the stock of the Company's subsidiaries. The loan
agreements include customary covenants for transactions of this
nature, including the maintenance of various ratios.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits.
(a) and (b). It was impracticable to file the required
financial statements for the business acquired, as well as the
required pro forma financial information respecting the
acquisition, at the time this report was filed. The omitted
information will be filed as soon as practicable, but in no event
later than 60 days after this report is required to be filed.
(c). The following exhibit is filed as a part of this
report:
Exhibit 2.1: Stock Purchase Agreement dated November
29, 1995 among Astronics Corporation, Loctite Corporation and
Loctite Luminescent Systems, Inc. Pursuant to Rule 601(b)(2) of
Regulation S-K, exhibits and schedules to this agreement have
been omitted. The Company hereby agrees to supplementally
provide to the Securities and Exchange Commission copies of the
schedules upon request.
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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 hereunto duly authorized.
ASTRONICS CORPORATION
ASTRONICS CORPORATION
(Registrant)
Date: December 13, 1995 By:Kevin T. Keane
Kevin T. Keane
President and Chief
Executive Officer
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Exhibit 2.1
ASSET PURCHASE AGREEMENT
AGREEMENT made as of this 29th day of November, 1995,
by and among Astronics Corporation, a New York corporation
("Buyer"), Loctite Corporation, a Delaware corporation
("Loctite") and Loctite Luminescent Systems, Inc., a New
Hampshire corporation ("Seller").
WHEREAS, Seller, a wholly-owned subsidiary of Loctite,
is engaged in the business of designing, developing,
manufacturing and selling electroluminescent lamps, formation
lights and egress lighting systems and products and systems
related to the foregoing (which business, together with all other
business conducted at Seller's Lebanon, New Hampshire facilities,
is hereafter referred to as the "Business"); and
WHEREAS, Buyer desires to purchase, through its wholly-
owned subsidiary, E-L FlexKey Technologies, Inc. ("E-L"), and
Seller desires to sell, substantially all of the assets of the
Business upon the terms, conditions and provisions hereinafter
set forth; and
WHEREAS, in order to induce Buyer to acquire the
Business, Loctite and Seller will, among other things, agree not
to engage in competition with the Business as provided in
Article XIII of this Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
PURCHASE AND SALE OF ASSETS
1.1 Asset Purchase. Subject to the terms and
conditions set forth in this Agreement, Buyer will purchase from
Seller, and Seller will sell, assign and transfer to Buyer on the
Closing Date (as defined in Section 2.5), free and clear of all
liens, encumbrances, security interests, pledges, mortgages,
claims or any other limitations or restrictions and assets of the
Business of every kind, nature and description, tangible and
intangible, wherever situated, other than those specifically
excluded in Section 1.2 hereto, (the "Purchased Assets"),
including, without limiting the generality of the foregoing, the
following:
(a) all inventories of supplies, materials and
products, including raw materials, work in process, finished
and semifinished products, and all other merchandise on hand
at Seller's business premises or at other locations
("Inventory");
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(b) the real property lease rights as described in
Schedule 1.1(b) attached hereto (the "Leases") and all
related leasehold improvements belonging to Seller or
Loctite, if any;
(c) Seller's entire right, title and interest in and
to the contracts, leases and agreements with other parties
listed on Schedule 1.1(c) attached hereto (the "Assumed
Contracts");
(d) all machinery and equipment of every kind,
including, without limitation, machinery and equipment owned
by Seller but located at any suppliers or vendors,
manufacturing machines and equipment, assembly machines and
equipment, warehouse equipment, shipping equipment,
vehicles, spare parts, supplies, tools, fixtures and dies,
office equipment, and office furniture, furnishings and
supplies and specifically including, but not limited to,
machinery and equipment identified on Schedule 1.1(d)
attached hereto ("Equipment");
(e) all registered and unregistered patents,
trademarks, service marks, tradenames, copyrights, and
applications therefor, and all related rights, associated
goodwill and other intangible property, and specifically
including, but not limited to, those listed on
Schedule 1.1(e) attached hereto;
(f) all books and records of every kind pertaining to
the Business, including but not limited to books and records
pertaining to Inventory, Equipment, intangible property,
agreements, customers, credit information, sales prospects
and suppliers;
(g) all trade secrets, technology, know-how and
similar information, including, without limitation, tooling
design, specifications, drawings, formulae, bills of
material, parts lists and engineering documentation;
(h) all advertising and promotional literature and
material, including, without limitation, catalogs,
brochures, pamphlets, artwork and printing plates used in
connection with the Business, subject, however, to
Section 5.12 of this Agreement;
(i) all trade accounts receivable, notes receivable
and any other receivables owing to Seller (whether or not
currently payable) (the "Receivables"); provided, however,
that the Receivables shall exclude all such receivables
relating to Seller's business operations in Belgium and
relating to transactions between Seller's affiliates and
other intercompany entities;
(j) all unfilled customer orders accepted by Seller in
the ordinary course, where the products of the Business have
not been delivered nor paid for, which orders shall be set
forth on Schedule 1.1(j) (the "Customer Orders"); and
(k) all goodwill associated with the Business.
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Without limiting the foregoing, the Purchased Assets
specifically shall include the exclusive right to
manufacture and sell Seller's Dimension Lamp (the "Lamp")
and the chemical binder used in producing the Lamp (the
"Binder") and all other assets relating to the design,
manufacture and sale of the Lamp.
1.2 Excluded Assets. The purchase and sale of the
Purchased Assets pursuant to Section 1.1 shall exclude only the
following assets of Seller ("Excluded Assets") as of the Closing
Date:
(a) cash on hand and in banks;
(b) the stock ledger, tax returns and minute books of
Seller and other records required by statute to be
maintained pursuant to applicable tax and securities laws
and regulations, subject, however, to Section 5.13;
(c) any right of Seller to any federal, state or local
tax refund;
(d) refunds on prepaid insurance or other prepaid
items as provided in Section 2.3;
(e) any rights to the name "Loctite" or trademarks or
trade names using the name "Loctite" except for the rights
granted to Buyer pursuant to Section 5.12 of this Agreement.
1.3 Assumption of Liabilities. At the Closing, Buyer
shall assume and undertake to pay or fulfill, as the case may be
(i) the trade accounts payable of Seller which are unpaid at the
Closing Date but only to the extent that such trade payables were
incurred by Seller in the ordinary course of the Business and
goods or services in respect of such trade payables were received
by Seller not more than thirty-five (35) days prior to the
Closing Date, (ii) the Customer Orders identified on
Schedule 1.1(j), and (iii) the open purchase orders identified on
Schedule 3.8. (collectively the "Assumed Liabilities"). Except
as provided in the preceding sentence or in Section 1.5 below,
Buyer shall not and does not assume, and shall not in any way
become liable for, any contracts, obligations or liabilities of
Seller or Loctite of any nature whatsoever (whether accrued,
absolute or contingent, whether disclosed or undisclosed, whether
known or unknown, whether related to Business or otherwise and
regardless of when asserted).
1.4 Hiring of Seller's Employees. (a) Seller shall
be solely responsible for all wages, benefits and other
compensation payable to, or accrued with respect to, its
employees for all periods up to the Closing Date including,
without limitation, disability benefits, workers' compensation
benefits, and accrued vacation; provided, however, that Buyer
shall be responsible for all costs of the Christmas week (1995)
holiday of the Business. Seller shall also be solely responsible
for all liability, cost, expense and sanctions resulting from
Seller's failure to comply with the Worker Adjustment and
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Retraining Notification Act, as amended, and the regulations
thereunder in connection with the consummation of the
transactions contemplated by this Agreement.
(b) On the Closing Date, Buyer shall offer employment
to those employees of Seller listed on Schedule 1.4 attached
hereto who are actively working in the Business on the Closing
Date. Buyer shall be solely responsible for the terms and
conditions of employment extended to Seller's former employees
upon their employment with Buyer.
(c) On the Closing Date, Buyer may, at its option,
offer employment to the three employees of Loctite or its Belgium
affiliate providing services to the Business located in Belgium
("Belgium Employees"). With respect to any Belgium Employee to
whom Buyer does not offer employment or who is terminated by
Buyer on or before January 31, 1996, Loctite shall be solely
responsible for any severance benefits due to such employee.
With respect to any Belgium Employee hired by Buyer and whose
employment with Buyer is continued past January 31, 1996, Buyer
shall be solely responsible for any severance benefits due to
such employee. In the event Loctite pays severance with respect
to one or more Belgium Employees and Buyer or an affiliate of
Buyer subsequently hires, rehires or otherwise engages such
person, Buyer shall reimburse Loctite for such severance.
1.5 Assumption of Contracts and Leases. Buyer shall
assume the following obligations of Seller as of the Closing
Date:
(a) the Leases listed on Schedule 1.1(b) hereto; and
(b) the Assumed Contracts listed on Schedule 1.1(c)
hereto.
Notwithstanding the foregoing, Buyer shall not assume any
obligation under the Leases or Assumed Contracts relating to any
breach thereof by Seller or any wrongful act or omission of
Seller prior to the Closing Date.
1.6 Assets From Seller's Affiliates.
(a) At the Closing, Seller and Loctite will cause
their affiliate, Loctite UK Limited, to sell, assign and
transfer to Buyer, free and clear of all liens,
encumbrances, security interests, pledges, mortgages, claims
or any other limitations or restrictions, all of Loctite UK
Limited's right, title and interest in and to Escapline
Limited, the Business' joint venture with MTL Industries
Group, plc.
(b) Also at the Closing, Seller and Loctite will cause
their affiliate, Loctite Belgium N.V., to sell, assign and
transfer to Buyer, free and clear of all liens, liabilities,
encumbrances, security interests, pledges, mortgages, claims
or any other limitations or restrictions, good and
marketable title to those assets relating to the Business'
operations in Belgium, which assets are identified on
Schedule 1.6.
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(c) For purposes of the representations and warranties
set forth in Article III of this Agreement, the assets to be
sold, assigned and transferred to Buyer from Seller's and
Loctite's affiliates pursuant to this Section 1.6 (the
"Affiliate Assets") shall be deemed to be included in the
term "Purchased Assets" and such representations shall apply
to the Affiliate Assets as if they were sold directly by
Seller. The Purchase Price (as hereinafter defined) shall
be reduced by the amount of any purchase price paid by Buyer
for the Affiliate Assets; provided, however, that in no
event will Buyer pay more than $12,500.00 for the Affiliate
Assets.
ARTICLE II
PURCHASE PRICE
2.1 Consideration. The total consideration to be paid
by Buyer for the Purchased Assets and Seller's and Loctite's
performance of this Agreement (the "Purchase Price") shall be
FIVE MILLION NINE HUNDRED SEVENTY-SEVEN THOUSAND FIVE HUNDRED AND
00/100 DOLLARS ($5,977,500.00), plus the Assumed Liabilities (as
defined in Section 1.3), and the contracts and leases assumed
pursuant to Section 1.5 hereof.
2.2 Manner of Payment. The Purchase Price will be
paid by Buyer to Seller on the Closing Date by wire transfer in
such amount.
2.3 Prepaid Expenses. Buyer shall reimburse Seller
for those prepaid expenses of Seller shown on Schedule 2.3 hereto
that will benefit Buyer after Closing.
2.4 Allocation of Purchase Price. The Purchase Price
shall be allocated to the Purchased Assets and Seller's and
Loctite's covenants under Article XIII of this Agreement as set
forth on Schedule 2.4 hereto. The parties hereto agree to take
positions consistent with the foregoing on all tax and other
returns and reports filed by them or including them.
2.5 Closing Date. The "Closing Date" as used in this
Agreement shall mean November 29, 1995 or such other date as the
parties hereto may agree upon in writing. The closing (the
"Closing") shall take place at the offices of Seller in Lebanon,
New Hampshire or at such other place as the parties may agree
upon in writing. The sale of the Purchased Assets and all other
transactions provided for in this Agreement shall be effective
for all purposes on and as of the opening of business on the
Closing Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller and Loctite hereby jointly and severally
represent and warrant to Buyer, which representations and
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warranties shall be true and correct on and as of the date of
this Agreement and the Closing Date, as follows:
3.1 Good Standing. Seller is a corporation duly
organized, validly existing and in good standing under the laws
of the State of New Hampshire and has the corporate power and
authority to own and use its properties and to transact the
Business. Seller is also qualified to do business in the State
of Connecticut. Seller is not qualified, and is not required to
be qualified, to do business in any other state. Except as
specified on Schedule 3.1, Seller does not have, and the
Purchased Assets do not include, any subsidiary or any ownership
interest in any other business organization or entity.
3.2 Authorization. This Agreement and the
transactions contemplated hereby have been duly authorized by the
Board of Directors and shareholder of Seller, and all corporate
action of Seller and Loctite necessary to authorize the execution
and delivery of this Agreement and the consummation of the
transactions contemplated hereby has been duly taken. This
Agreement constitutes the legal, valid and binding obligation of
Seller and Loctite enforceable against each of them in accordance
with its terms. The execution and delivery of this Agreement do
not, and the consummation of transactions contemplated by this
Agreement will not (i) violate or conflict with any provisions of
the Articles of Incorporation or Bylaws of Seller or Loctite,
(ii) violate, with or without the giving of notice or the passage
of time, any provision of law applicable to Seller or Loctite,
(iii) result in the creation of any lien, liability, encumbrance,
claim, security and marketable interest or other restriction upon
any of the Purchased Assets; or (iv) except as specified on
Schedule 3.2, conflict with or result in a breach of any of the
Contracts (as defined in Section 3.16).
3.3 Title to Assets; Liens and Encumbrances. Seller
has good and marketable title to all of the Purchased Assets,
free and clear of all liens (including tax liens other than
inchoate tax liens), encumbrances, security interests, pledges,
mortgages, claims or any other limitations or restrictions
whatsoever. Except as specified in Schedule 3.3 hereto, all
Purchased Assets are located at Seller's premises.
3.4 Inventory. Schedule 3.4 hereto sets forth a
complete and accurate list of all Inventory as of November 14,
1995 and all such Inventory is being sold to Buyer on an "as is"
basis. All Inventory acquired after November 14, 1995 has been
acquired in the ordinary course of the Business, in customary
quantities and at prevailing prices, is not obsolete and is not
in disrepair, and consists of items of a quality and quantity
that is usable and saleable in the ordinary course of the
Business.
3.5 Patents, Trademarks and Copyrights.
Schedule 1.1(e) hereto lists all patents, trademarks, service
marks, tradenames, and copyrights (or applications therefor),
heretofore or presently used or required to be used by Seller in
connection with the Business. Seller has the right to make, use
and sell all the products of the Business and is the sole and
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outright owner of any patents, trademarks, service marks,
tradenames, and copyrights (or applications therefor) trade
secrets or know-how or other intellectual property used therein
(including, but not limited to, those listed on Schedule 1.1(e)),
has the sole right and power to sell, convey or otherwise dispose
of the same without approval of any person, and none of the same
are subject to any outstanding licenses, liens, encumbrances,
claims or other restrictions. Neither Seller nor Loctite has
received any written notice that the Business as heretofore
conducted by Seller infringes, or has infringed, the rights of
any third party and to the best knowledge of Seller and Loctite,
the Business as heretofore conducted by Seller does not infringe,
and has not infringed, the rights of any third party.
3.6 Leases. Each of the Leases are in full force and
effect and Seller is not in default of any material term thereof
nor, to Seller's knowledge, is any other party thereto in
default. True and correct copies of the Leases, as amended, have
been provided to Buyer on or prior to the date hereof.
Schedule 1.1(c) hereto lists all leases of personalty to which
Seller is a party, and which will be assigned to and assumed by
Buyer as of the Closing Date. Except as specified on
Schedule 3.2, consummation of the transactions contemplated by
this Agreement will not violate or cause a breach under any of
the Leases or the aforesaid leases of personal property.
3.7 Insurance. There are no product liability, third
party liability or, except as set forth on Schedule 3.7, worker's
compensation claims or proceedings pending or, to the knowledge
of Seller, threatened against Seller. Schedule 3.7 hereto also
sets forth a complete and accurate list of all policies of
property, liability and other forms of insurance carried by the
Business since 1986, stating in each case the nature of the risks
covered and the amount of coverage. Seller is not in default in
any material respect with respect to any provision contained in
any insurance policy; representations made in all applications
for such insurance policies are accurate and remain true; and
Seller has not failed to give any notice or present any material
claim under any insurance policy in due and timely fashion. All
claims, if any, made against Seller which are covered by
insurance are being defended by the appropriate insurance
companies.
3.8 Purchase Orders and Sales Commitments.
Schedule 3.8 sets forth a complete and accurate list of all
outstanding purchase orders issued by Seller to vendors and
Schedule 1.1(j) sets forth a list of all sales commitments
received and/or accepted by Seller from its customers. All
purchase orders and sales commitments outstanding on the date
hereof or entered into between the date hereof and the Closing
Date have been entered into in the ordinary course of business
and in accordance with past practice. Except as specified on
Schedule 3.2, consummation of the transactions contemplated by
this Agreement will not violate or cause a breach under any such
purchase order or sales commitment. Except as specified on
Schedule 3.8, Seller has not received any prepayment in respect
of any such sales commitment.
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3.9 Legal Proceedings, Orders, Decrees, Etc. Except
as specified on Schedule 3.9 hereto, to the best knowledge of
Seller and Loctite, there are no actions, suits, proceedings or
investigations (whether or not purportedly on behalf of Seller)
instituted by or against Seller, at law or in equity or before
any governmental department, commission, board, agency or
instrumentality, domestic or foreign, whether or not fully
covered by insurance, and Seller is not in default or non-
compliance with respect to any order, writ, injunction, permit,
authorization or decree of any court or any such department,
commission, board, agency or instrumentality, domestic or
foreign. To the best knowledge of Seller and Loctite, there are
no orders, decrees, injunctions or regulations of any court or
any governmental department, commission, board, agency or
instrumentality issued specifically against Seller which affect,
limit or control Seller's method or manner of doing business.
3.10 Condition of Property. The Equipment and all
other property owned or otherwise used by Seller are in such
operating condition and repair as is sufficient to conduct the
Business, subject to normal wear and tear in the ordinary course
of business, in the same manner in which the Business has been
conducted prior to the date of this Agreement.
3.11 Compliance with the Law. To the best of Seller's
knowledge and belief, Seller has complied with all laws, orders
and regulations of any governmental department, commission, board
or agency or instrumentality, domestic or foreign, having
jurisdiction over Seller or its operations relating to
occupational safety and health, environmental protection, water
or air pollution, toxic substances control, consumer product
safety, hiring, wages, hours, employee benefit plans and
programs, collective bargaining and the payment of withholding
and social security taxes, and non-compliance with which would
have a material impact on Seller's Business or the operation
thereof.
3.12 Government Approvals, Notices and Filings.
Except with respect to the government contracts identified on
Schedule 1.1(j), no consent or approval of, giving of notice to,
registration with, or taking of any action in respect of or by,
any federal, state or local governmental authority or agency is
required with respect to the execution, delivery or performance
by Seller of this Agreement.
3.13 Financial Statements. The unaudited internal
financial statements of Seller attached as Schedule 3.13 hereto
(the "Statements"), which were prepared by Seller in the normal
course for use in the management of the Business, present fairly
the financial position of Seller as of the dates stated thereon
and the results of its operations for the periods stated thereon,
with the following stipulations: (i) the information contained
in such Statements is limited to that information management
chose to present for its internal purposes; (ii) Loctite and
Seller each use different methods of allocating standard costs
and variances, although the aggregate cost of goods sold is the
same; and (iii) that while the Statements were utilized in the
preparation of the consolidated financial statements of Loctite,
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the Statements themselves do not include all items, adjustments
and notes necessary to conform with generally accepted accounting
principles, which are only prepared on a consolidated basis at
the time of the preparation of the consolidated financial
statements of Loctite.
3.14 Tax Matters. Seller has duly filed with the
appropriate foreign, federal, state and local governmental
agencies all tax returns and reports which are required to be
filed, and has paid in full all taxes (including interest and
penalties) owed by Seller. Seller is not a party to any pending
action or proceeding, nor is any action or proceeding threatened,
by any governmental authority for assessment or collection of
taxes, and no claim for assessment or collection of taxes, has
been asserted against Seller.
3.15 Condition of Real Estate. Seller does not own,
occupy or otherwise have an interest in, and the Purchased Assets
do not include an interest in, any real property except for the
real property which is the subject of the Leases. The real
property which is the subject of the Leases is hereinafter
referred to collectively as the "Premises". Except as specified
on Schedule 3.15:
(a) to the best knowledge of Seller and Loctite, the
Premises and all improvements located thereon, comply with
all zoning, land use, environmental, building and fire laws,
codes, ordinances and regulations;
(b) to the best knowledge of Seller and Loctite, there
are no actions, suits, proceedings or investigations pending
or threatened before any federal, state, municipal,
regulatory or administrative authority affecting the
Premises;
(c) Seller is not in default with respect to any
order, judgment, injunction or decree of any court or other
governmental authority with respect to the Premises;
(d) Seller is not in default under any agreement,
contract or lease relating to the Premises;
(e) to the best knowledge of Seller and Loctite, the
improvements located on the Premises are in good condition
and are free from all structural defects;
(f) to the best knowledge of Seller and Loctite, all
mechanical systems serving the Premises, including, but not
limited to the heating, ventilation, air conditioning,
plumbing and electrical systems, are in good working order;
(g) to the best knowledge of Seller and Loctite, the
improvements located on the Premises do not contain asbestos
of any kind whatsoever, or urea formaldehyde foam
insulation;
(h) except for the Leases, there are no leases or
subleases affecting the Premises;
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(i) all water, sewer, gas, electric, telephone and
drainage facilities and all other utilities required for the
use and operation of the Premises are available;
(j) except as consistent with applicable Environmental
Laws, (as hereinafter defined) neither Seller nor, to the
best of Seller's and Loctite's knowledge, any other person
has caused or permitted Hazardous Substances (as hereinafter
defined) to be present on or below the surface of the
Premises or any improvements located thereon;
(k) neither Seller nor, to the best of Seller's and
Loctite's knowledge, any other person has used the Premises
for the manufacture, refining, generating, treatment,
storage, or disposal of any Hazardous Substances;
(l) neither Seller nor, to the best of Seller's and
Loctite's knowledge, any other person has caused or
permitted the soil, ground water, or surface water of the
Premises to be contaminated by any Hazardous Substances;
(m) except as permitted under applicable Environmental
Laws, no Hazardous Substances are emitted, discharged or
released from the Premises or improvements located thereon
directly or indirectly, into the atmosphere, soil, ground
water or surface water;
(n) neither Seller, Loctite, nor to the best of
Seller's and Loctite's knowledge, any present or former
owner or operator of all or a portion of the Premises, has
the potential to be liable for cleanup or response costs
with respect to the emission, discharge, or release of any
Hazardous Substance at the Premises or any other location or
for any other matter arising under the Environmental Laws
due to its ownership, lease or operation of all or a portion
of the Premises;
(o) no "underground storage tank" (as that term is
defined in regulations promulgated by the Environmental
Protection Agency) is located in the Premises; and
(p) each such underground storage tank identified in
Schedule 3.15 is in compliance with applicable Environmental
Law.
As used in this Agreement (i) "Hazardous Substances"
shall mean waste, substance, materials, smoke, gas or particulate
matter defined or regulated, as hazardous, toxic or dangerous
under any Environmental Law and (ii) "Environmental Law" shall
mean the Comprehensive Environmental Response Compensation and
Liability Act and any other law commonly referred to as
"superfund" or "superlien", the Clean Water Act, the Resource
Conservation and Recovery Act, the Clean Air Act or any successor
to such laws or any other applicable federal, state or local
environmental, health or safety law, rules or regulations
imposing liability or standards concerning or in connection with
hazardous, toxic or dangerous waste, substance, materials, smoke,
gas or particulate matter.
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Seller has no knowledge of any pending or threatened
assessments for municipal improvements which may affect or become
a lien on the Premises. Except for the matter addressed in
Section 5.14(c), neither Seller nor Loctite has knowledge of any
material capital expenditure which will be required in order to
cause the Business and the operation of the Business to maintain
compliance with applicable Environmental Laws.
3.16 Contracts. Seller is not a party to or subject
to any agreement, contract or commitment (whether oral or
written) which is material to the conduct of the Business except
for the Leases, Assumed Contracts, Customer Orders and the
outstanding purchase orders listed on Schedule 3.8 (collectively,
the "Contracts"). Each of the Contracts is valid, binding and in
full force and effect and Seller is not in default or alleged to
be in default thereunder and Seller has no knowledge that any
other party thereto is in default. Nothing has occurred which,
with or without the passage of time or giving of notice or both,
would constitute a default by Seller or any other party under any
of the Contracts. Except as specified on Schedule 3.2, each of
the Contracts may be assigned to Buyer without the consent of any
other person and without giving notice to any person regarding
this Agreement or the sale and transfer of the Purchased Assets
or other transactions contemplated hereby.
3.17 Labor Matters. There are no strikes,
arbitrations, grievances, other labor disputes or union
organizational drives pending or threatened between Seller and
any of its employees. Seller is not party to any union,
collective bargaining or other similar agreements. Seller has
paid in full or accrued for all wages, salaries, commissions,
bonuses and other compensation (including vacation benefits) for
all services performed by its employees. Schedule 3.17 hereto
sets forth with respect to each employee of Seller, his name,
position, salary or wage, and all other compensation paid to such
employee. Seller is not liable for any arrears of wages or any
payroll taxes or any penalties or other damages for failure to
comply with any applicable foreign, federal, state and local laws
relating to the employment of labor.
3.18 Transactions with Certain Persons. Except for
Loctite's manufacture of the Binder for Seller and certain other
administrative services provided by Loctite to Seller which
services are similar to services customarily performed by a
parent corporation for a wholly-owned subsidiary, no current or
former director, officer, employee, shareholder or other
affiliate of Seller or any of their affiliates has any interest
in any property, real or personal, tangible or intangible, used
in or pertaining to the Business and there have been no
transactions between Seller and any current or former director,
officer, employee, shareholder or other affiliate of Seller or
their affiliates except employment arrangements and the leases of
the Premises as disclosed in the Agreement or the Schedules
hereto.
3.19 Permits. To the best of Seller's and Loctite's
knowledge, Seller holds and is in compliance with all licenses,
permits, and other approvals that are required to permit it to
<PAGE>
conduct the Business as heretofore conducted. All such licenses,
permits, and other approvals are described in Schedule 3.19
hereto and are valid and in full force and effect. This
Agreement and consummation of the transactions contemplated
hereby will not terminate or adversely affect the existence,
validity and continued effectiveness of any of such licenses,
permits or other approvals.
3.20 Accounts Receivable. Schedule 3.20 sets forth a
complete and accurate list of all receivables of the Business as
of November 14, 1995 and, other than such list being accurate as
to existence and amount, all such Receivables are being sold by
Seller to Buyer "as is" without any representation or warranty of
collectability.
3.21 General Representation and Warranty. Neither
this Agreement nor any Schedule or other documents furnished by
or on behalf of Seller or Loctite in connection with this
Agreement contains any untrue statement of a material fact or
omits to state any material fact necessary to make the statements
contained herein or therein not misleading. The Purchased Assets
constitute all of the assets necessary to conduct the Business as
heretofore conducted by Seller.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby represents and warrants to Seller, which
representations and warranties shall be true and correct on and
as of the date of this Agreement and the Closing Date, as
follows:
4.1 Good Standing. Buyer is a corporation duly
organized, validly existing and in good standing under the laws
of the State of New York, and has the corporate power and the
authority to own and use its properties and to transact the
business in which it is engaged and the Seller's Business after
the Closing Date.
4.2 Authorization. This Agreement and the
transactions contemplated hereby shall have been duly authorized,
executed and delivered on behalf of Buyer, and this Agreement
constitutes the legal, valid and binding obligation of Buyer in
accordance with its terms. The execution and delivery of this
Agreement do not, and the transactions contemplated by this
Agreement will not violate or conflict with any provisions of the
Articles of Incorporation or Bylaws of Buyer.
4.3 Government Approvals, Notices and Filings. Except
as specified on Schedule 4.3, no consent or approval of, giving
of notice to, registration with, or taking of any action in
respect of or by, any federal, state or local governmental
authority or agency is required with respect to the execution,
delivery or performance by Buyer of this Agreement.
<PAGE>
4.4 Permits. To the best of Buyer's knowledge, Buyer
holds all licenses, permits and other approvals that are required
to permit it to conduct its business as heretofore conducted.
This Agreement and consummation of the transactions contemplated
hereby will not terminate or adversely affect the existence,
validity and continued effectiveness of any such licenses,
permits or other approvals.
4.5 General Representation and Warranty. Neither this
Agreement nor any Schedule or other document furnished by or on
behalf of Buyer in connection with this Agreement contains any
untrue statement of a material fact or omits to state any
material fact necessary to make the statements contained herein
or therein not misleading.
ARTICLE V
ADDITIONAL COVENANTS OF THE PARTIES
5.1 Publicity. Until the Closing Date, the parties
heretofore agree to keep the existence, terms and details of this
Agreement and all agreements related to the transactions
contemplated herein confidential except (i) to issue mutually
agreed upon press releases as soon as practicable after the
execution of this Agreement, (ii) as otherwise may be required in
order to comply with this Agreement and prepare for the Closing,
(iii) as required by applicable law, provided, however, that any
party which intends to make a disclosure that it believes is
required by applicable law will give prior notice thereof to each
other party or (iv) as required by each party's financial,
accounting, legal and other advisors (including Buyer's lenders)
in order to assist such party in connection herewith.
5.2 Operations. From the date hereof until the
Closing Date, except as otherwise expressly provided by this
Agreement, or as Buyer may otherwise consent to in writing,
Seller shall not, and Loctite shall cause Seller not to, engage
in any activity or enter into any transaction outside the
ordinary and usual course of its business or which would be
inconsistent with the terms of this Agreement or which would
render inaccurate as of the Closing Date any of the
representations and warranties set forth in Article III as if
such representations and warranties were made at and as of the
Closing Date. Without limiting the generality of the foregoing,
Seller shall, and Loctite shall cause Seller to, continue its
current practices and maintain its current systems with respect
to accounts receivables, trade payables and inventory.
5.3 Contract Novation. Before and after the Closing,
Seller will assist Buyer as reasonably requested in connection
with any contract novation.
5.4 Consultation. Seller will make Mr. Jeff
Piccolomini reasonably available for telephone consultation
before the Closing and for a reasonable period thereafter.
<PAGE>
5.5 Audit; SEC Reporting. Prior to the Closing Date,
Buyer will engage Ernst & Young LLP, its outside independent
auditor, to prepare audited financial statements of the Business
for fiscal years ending December 31, 1993 and 1994 or such other
or different periods required to satisfy Buyer's filing
obligations under the Securities and Exchange Act of 1934, as
amended. The financial statements and unqualified auditor's
report thereon shall be of form and content satisfactory to the
SEC. Loctite agrees to provide its friendly assistance and
cooperation in the preparation of the financial statements and
will, to the extent applicable without requiring Seller or
Loctite to incur outside professional fees, provide the customary
representations with respect to Buyer's preparation of the
financial statements required to satisfy Buyer's SEC filing
obligations. It shall be up to the sole discretion of Price
Waterhouse, LLP, the outside independent auditor of Loctite and
Seller, as to whether or not Price Waterhouse, LLP will provide
any consent in connection with such financial statements. The
representations made by Loctite to Buyer's auditors in connection
with the preparation of such statements shall be limited solely
to use in connection with such financial statements, but shall
not in any way, whether express or implied, constitute any
representation or warranty under this Agreement, or expand or
modify any representation, warranty or other provision of this
Agreement. Loctite shall have no obligation to make any
representation with respect to any event subsequent to the
Closing, other than (i) events relating to the conduct of the
Business prior to Closing, and (ii) the sale of the assets
hereunder and transactions related thereto. Neither Seller nor
Loctite makes any representations or warranties, whether express
or implied, with respect to the audited financial statements as
prepared by Buyer's auditors other than expressly provided
herein.
5.6 Manufacture of Binder. (a) For a period of one
(1) year following the Closing, or such shorter period as Buyer
may determine, Loctite will manufacture the Binder for Buyer.
Buyer will pay Loctite $70 per kilogram of Binder. Loctite shall
have no proprietary interest in the Binder or the technology
related thereto and shall not use or permit the use of or
disclose or permit the disclosure of, any information related to
the Binder except as reasonably required to manufacture the
Binder for Buyer.
(b) Following the Closing, Loctite will consult
with Buyer regarding Buyer's manufacture of the Binder and will
do all things reasonably necessary in order to transfer the
technology regarding the manufacture of the Binder to Buyer.
Buyer will pay all reasonable out-of-pocket expenses necessarily
incurred by Loctite in connection with such consulting services.
(c) Also following the Closing, Loctite will, at
Buyer's request, assist Buyer in transferring the technology
regarding the manufacture of the Binder to any vendor selected by
Buyer.
<PAGE>
5.7 Releases. At the Closing, Seller and Loctite will
execute and deliver to Buyer a general release in the form of
Schedule 5.7A hereto, and Buyer will execute and deliver to
Seller and Loctite a general release in the form of Schedule 5.7B
hereto.
5.8 Estoppel Certificates. At the Closing, Seller
will cause each of RSS Realty Trust and Bond Optics, Inc., as
landlords under two of the Leases, to execute and deliver to
Buyer an estoppel certificate in the form of Schedule 5.8 hereto.
5.9 Access to Information.
(a) Seller and Loctite shall afford Buyer and its
representatives full access, during normal business hours and
upon reasonable notice, to all of the assets, properties, books,
records, and agreements of the Business, and shall furnish to
Buyer and its representatives such information regarding the
Business as Buyer may reasonably request. Seller and Loctite
shall cooperate with Buyer in visiting or contacting employees
and customers of, and persons having other business relationship
with, the Business as Buyer shall specify prior to the Closing.
Seller and Loctite shall also cooperate with Buyer in an
inspection of the Premises.
(b) Prior to the Closing, Seller shall engage a
qualified environmental consultant acceptable to Buyer to conduct
a ASTM Standard E1527 Phase I Site Assessment of the Premises
(the "Phase I Audit") and deliver to Buyer a copy of the final
Phase I Site Assessment upon which Buyer may expressly rely
together with all drafts thereof. The cost of the Phase I Audit
shall be shared equally by Buyer and Seller. The investigation
by Buyer and furnishing of information to Buyer shall not affect
the right of Buyer to rely on the representations, warranties,
covenants and agreements of Seller and Loctite in this Agreement.
5.10 Consents of Others. Prior to the Closing, Seller
and Loctite shall obtain all consents of others required to
permit the consummation of the transactions contemplated by this
Agreement and the continuation of the Business by Buyer.
Notwithstanding the foregoing, with respect to consents of third
parties required to assign the Contracts to Buyer, Seller and
Loctite will be required to obtain prior to Closing such consents
for those Contracts listed on Schedule 3.2 under the heading
"Preclosing." With respect to those Contracts listed on
Schedule 3.2 under the heading "Postclosing," Seller and Loctite
will assist Buyer as reasonably requested by Buyer to obtain any
consents of third parties required to assign such Contracts to
Buyer.
5.11 Aircraft Products and Insurance Continuation.
Seller will continue its aircraft liability coverage with its
existing insurance carrier (or any other reputable and
financially sound carrier reasonably satisfactory to Buyer) with
the same policy limits as of the date hereof for seven (7) years
from the Closing Date with respect to products of the Business
designed, manufactured and sold by Loctite or Seller prior to the
<PAGE>
Closing Date and will undertake to name Buyer and E-L as
additional insureds thereon. A certificate from the insurance
carrier with respect to the foregoing will be delivered to Buyer
on or before the Closing Date.
5.12 Interim Use of Seller's Trademark or Trade Names
With respect to trademarks and trade names not
included in the Purchased Assets:
(a) Trade Name and Trademark Use on Products and
Product Packaging. Buyer shall have the right to continue to use
the trade names of the Business (i) on inventory existing on the
Closing Date until the depletion of such inventory, (ii) on
packaging materials existing on the Closing Date until the
depletion of such inventory, (iii) on molds and tooling existing
on the Closing Date for a period of twelve (12) months after the
Closing Date, and (iv) on inventory manufactured by Seller within
a period of eighteen (18) months after the Closing Date using the
molds and tooling referred to in item (iii) above, until the
depletion of such inventory to the extent that such trademarks
are generated by existing molds and tooling (but not nameplate
making equipment where imprinting of such trademarks shall cease
within thirty (30) days). Notwithstanding the foregoing, Buyer
may continue to use Seller's nameplates with respect to Customer
Orders until such Customer Orders are novated.
(b) Trade Name and Trademark Use on Sales Aids
and Literature. Buyer shall delete or obliterate all use of the
Seller's trademarks or trade names from all sales literature
within a reasonable period after the Closing Date, but in no
event later than six (6) months after the Closing Date. Buyer
shall have the right in such sales literature to indicate that
they are conducting the Business as successor to Seller.
(c) Trade Name, Trademark and Wordmark Use in
Trade Identification. Buyer shall cease using and destroy (or
return to Seller) within a reasonable time not to exceed three
(3) months after the Closing Date (1) all documents (including
but not limited to letterhead, envelopes, business cards,
standard business forms, invoices and purchase orders) bearing
the trade names or the trademarks of the Seller; and (2) all
trade signs at facilities or on vehicles that include the trade
name or the trademark of the Seller. Notwithstanding the
foregoing, Buyer shall be permitted to use the Seller's trade
name as long as is required for the purpose of collecting the
Receivables.
(d) Trade Names and Trademark Use on Drawings.
Buyer shall delete or obliterate all reference to the Seller's
trade names or trademark within a reasonable time not to exceed
six (6) months on all drawings still in active use within the
Business.
(e) Trade Name and Trademark Use in General.
Except as specifically provided above, Buyer shall not have any
other rights to use the Seller's trade names or trademarks or any
confusingly similar trade identification or trademark.
<PAGE>
5.13 Access to Books and Records. After the Closing,
Buyer, Loctite and Seller shall each permit the other to have
access to and the right to make copies of such books, records and
files in its possession relating to the Business for any
reasonable purpose at any time during regular business hours,
such as for use in contract administration, engineering,
production or design, litigation or financial reporting, tax
return preparation, or tax or securities law compliance matters.
In addition to the foregoing, within seven (7) business days
after the Closing Date, Buyer will generate and deliver to Seller
interim financial statements of the Business as of the close of
business on the day immediately preceding the Closing Date, which
financial statements shall be in the form customarily prepared by
the Business; provided, however, Buyer shall make no
representation or warranty regarding such financial statements
and shall have no obligation or liability with respect thereto.
5.14 Environmental Covenants.
(a) The parties acknowledge the existence of a
10,000 gallon underground storage tank on the Premises which is
used by the Business to store fuel oil, which tank is identified
on Schedule 3.15 (the "UST"). Buyer may, at its option, continue
to use the UST until September 1, 1996 and upon Buyer's
termination of use of the UST (which termination shall be no
later than September 1, 1996) it shall give prompt written notice
to Loctite and Seller. During Buyer's use of the UST and upon
Buyer's termination of its use of the UST, Loctite and Seller
shall, at their sole expense, take all action required under any
applicable law or regulation or under any Lease, to test,
inspect, upgrade, remove, close or replace the UST and remediate
any associated environmental condition, including without
limitation, any soil or groundwater contamination; provided,
however, that any spill or leak caused on or after the Closing
Date by Buyer or any third party (except for third parties acting
on Seller's or Loctite's behalf) shall be the responsibility of
Buyer who shall, at Buyer's expense, clean up such spill or leak
and remediate any resulting environmental condition.
Loctite and Seller shall have the right, at their
expense and subject to any consent required from the landlord, to
place monitoring wells near the UST to monitor its condition. In
the event that, on or after the Closing Date, any leak is
detected in the UST or the UST fails to pass any tightness or
pressure test, Loctite and Seller shall have the option to have
the UST removed as soon as practicable (while making a good faith
effort to allow Buyer time to install an alternate heating
source), notwithstanding that Buyer may be required under the
preceding paragraph to clean up any such leak and remediate any
resulting environmental condition, unless Buyer is able to
identify an interim remedy that does not increase the likelihood
of further leakage and Buyer agrees to pay all costs associated
with any such interim remedy.
(b) From and after the Closing, Loctite and Seller
shall, at their own expense, promptly remedy any instance of non-
compliance with applicable law, rule or regulation reported in
the Phase I Audit.
<PAGE>
(c) The parties acknowledge that the Business and the
Premises are the subject of certain pending federal (USEPA),
state (NHDES) and local (City of Lebanon, N.H.) regulatory
actions regarding waste water discharges (the "Pending Regulatory
Actions"), and that the Pending Regulatory Actions may result in,
among other things, the Business being required to acquire and
install waste water pretreatment, control or monitoring
equipment, technology or procedures. Following the Closing,
Seller and Loctite will at their expense (i) continue to
diligently work to expeditiously resolve the Pending Regulatory
Actions on behalf of Buyer and the Business; (ii) acquire and
install any such equipment, technology or procedures as may be
required to resolve the Pending Regulatory Actions (the
"Solution"); (iii) pay any fine, penalty or expense imposed or
incurred as a result of or arising out of the failure of the
Business to comply, prior to the Closing, with any federal, state
or local statute, rule or regulation concerning waste water
("Waste Water Requirements"); and (iv) pay any fine, penalty or
expense imposed or incurred as a result of or arising out of the
failure of the Business to comply, after the Closing, with any
Waste Water Requirements but only to the extent that such failure
is attributable to Buyer's continuation of Seller's practices
with respect to waste water pending the determination and
implementation by Seller and Loctite of the Solution. Seller and
Loctite will keep Buyer informed as to the status of the Pending
Regulatory Actions and the Solution and promptly transmit to
Buyer copies of any reports, data or other information or
documents arising from the Pending Regulatory Actions and the
Solution. Buyer will cooperate with Seller and Loctite and
provide Seller, Loctite and their experts, consultants or
contractors with reasonable access to the Premises in connection
with their obligations under this Section 5.14(c). Seller,
Loctite and their agents, consultants or contractors will perform
their obligations under this Section 5.14(c) in a manner which
shall minimize interference with Buyer's operation of the
Business. Seller and Loctite shall determine, in their sole
reasonable discretion, the Solution provided that the Solution
chosen shall (i) constitute a final resolution of the Pending
Regulatory Actions, (ii) be commercially reasonable (iii) not
materially adversely affect the operations of the Business or the
costs thereof; and (iv) comply with all Waste Water Requirements.
Seller and Loctite shall be responsible for any capital cost
associated with the Solution, but Buyer shall be responsible
thereafter for the operation and ongoing expense of continuing or
maintaining such Solution. Neither Seller nor Loctite shall have
any liability to Buyer or E-L attributable to or arising out of
the failure of Buyer or any other party to operate the Business
in a manner consistent with the Solution following its
implementation.
5.15 Accounts Receivable. Upon the Closing, Seller and
Loctite will, upon request by Buyer, execute and deliver to all
customers of the Business a mutually satisfactory notice of the
sale of the Business to Buyer which notice may include, among
other things, instructions with respect to payments of the
Receivables. In addition, Seller and Loctite will promptly
deliver to Buyer payment for Receivables received by Seller or
Loctite on or after the Closing Date.
<PAGE>
5.16 British Aerospace. Prior to the Closing, Seller
shall pay to British Aerospace Operations (Seller's customer
No. 001101), in cash, all credits due thereto, including but not
limited to, the credit balance showing on Schedule 3.20.
ARTICLE VI
CONDITIONS TO BUYER'S OBLIGATION TO CLOSE
The obligations of Buyer under this Agreement are, at
the option of Buyer, subject to each of the conditions set forth
below, any of which may be waived in writing by Buyer.
6.1 Agreements and Conditions. On or before the
Closing Date, Seller and Loctite shall have complied with and
duly performed all agreements and conditions, including the
deliveries set forth in Article VIII of this Agreement, on its
part to be complied with and performed pursuant to or in
connection with this Agreement on or before the Closing Date.
6.2 Representations and Warranties. The
representations and warranties of Seller contained in this
Agreement shall be true and correct in all material respects on
and as of the Closing Date with the same force and effect as
though such representations and warranties had been made on and
as of the Closing Date.
6.3 Opinion of Counsel. Buyer shall have received an
opinion of counsel for Seller and Loctite, dated as of the
Closing Date, on the matters covered by Sections 3.1, 3.2, 3.3
(as to security interests and liens of record), and 3.12 of this
Agreement which opinion shall be in form and substance the same
as Schedule 6.3 hereto.
6.4 No Legal Proceedings. No court action or
proceeding shall have been instituted against Seller or Buyer or
any officer or director of either party to restrain or prohibit
the acquisition by Buyer, or the conveyance by Seller, of the
Purchased Assets, or which questions the validity of this
Agreement.
6.5 Consents to be Obtained by Seller. Subject to
Section 5.10, Seller shall have obtained the consent of each
other party to all contracts and agreements to be assigned to
Buyer pursuant to this Agreement to which Seller is a party,
which are not assignable to Buyer without the consent of the
other party at the time of Closing.
6.6 Bulk Sales, Etc. Seller shall provide at Closing
a list of Seller's creditors which shall contain the name and
address of each creditor and the amount due each creditor, and
shall be certified by the President of Seller.
6.7 Environmental Audit. Based on the results of the
Phase I Audit, Buyer shall be reasonably satisfied that there is
no Hazardous Substance on the Premises which (i) would violate
<PAGE>
any federal, state or local law or regulation, (ii) could impose
any potential liability on Buyer, or (iii) could result in the
incurrence of any expense by Buyer.
ARTICLE VII
CONDITIONS TO SELLER'S OBLIGATION TO CLOSE
The obligations of Seller under this Agreement are
subject to each of the conditions set forth below, any of which
may be waived in writing by Seller.
7.1 Agreements and Conditions. On or before the
Closing Date, Buyer shall have complied with and duly performed
all of the agreements and conditions on its part required to be
complied with or performed pursuant to this Agreement on or
before the Closing Date.
7.2 Representations and Warranties. The
representations and warranties of Buyer contained in this
Agreement shall be true and correct in all material respects on
and as of the Closing Date with the same force and effect as
though such representations and warranties had been made on and
as of the Closing Date.
7.3 Opinion of Counsel. Seller shall have received an
opinion of counsel for Buyer, dated as of the Closing Date, on
the matters covered by Sections 4.1, 4.2, and 4.3 which opinion
shall be in form and substance the same as Schedule 7.3 hereto.
7.4 No Legal Proceedings. No court action or
proceeding shall have been instituted against Seller or Buyer or
any officer or director of either party to restrain or prohibit
the acquisition by Buyer, or the conveyance by Seller, of the
Purchased Assets, or which questions the validity of this
Agreement.
ARTICLE VIII
DELIVERIES OF SELLER ON THE CLOSING DATE
Seller and Loctite agree on the Closing Date to deliver
to Buyer, in form satisfactory to Buyer, the following:
8.1 Instruments of Transfer. A bill of sale and
assignment in the form of Schedule 8.1 hereto and such other
instruments as Buyer shall reasonably request in order to
effectively transfer to vest in Buyer good and marketable title
to all of the Purchased Assets free and clear of all liabilities
and all liens, encumbrances, security interests, claims and other
restrictions.
8.2 Opinion of Counsel. The opinion of counsel for
Seller described in Section 6.3 hereof.
<PAGE>
8.3 Release. The general release described in
Section 5.7 hereof.
8.4 Estoppel Certificates. The Estoppel Certificates
described in Section 5.8 hereof.
8.5 Officer's Certificates. Certificates of officers
of Seller and Loctite certifying that the conditions set forth in
Sections 6.1 and 6.2 hereof have been fulfilled, which
certificates shall be in form and substance the same as
Schedule 8.5 hereto.
8.6 Consents. The consents of third parties described
by Section 5.10 hereof.
ARTICLE IX
DELIVERIES OF BUYER ON THE CLOSING DATE
Buyer agrees as of the Closing Date to deliver to
Seller, in form satisfactory to Seller, the following:
9.1 Payments. The Purchase Price to be delivered
pursuant to Section 2.2 hereof.
9.2 Opinion of Counsel. The opinion of counsel for
Buyer described in Section 7.3 hereof.
9.3 Undertaking. An undertaking of Buyer to pay the
Assumed Liabilities in accordance with their terms and to assume,
subject to Section 1.5, Seller's obligations under the Assumed
Contracts and the Leases, which undertaking shall be in form and
substance the same as Schedule 9.3 hereto.
9.4 Officer's Certificate. A Certificate of an
Officer of Buyer certifying that the conditions set forth in
Sections 7.1 and 7.2 hereof have fulfilled, which certificate
shall be in form and substance the same as Schedule 9.4 hereto.
ARTICLE X
OBLIGATIONS AFTER THE CLOSING
10.1 Documents of Transfer. Seller and Loctite agree,
from time to time after the Closing, upon the request of Buyer,
to do, execute, acknowledge and deliver, all such further acts,
assignments, transfers, powers of attorney and assurances as may
be reasonably required for the better assigning, transferring,
conveying, and confirming to Buyer, or to its successors and
assigns, or for the aiding, assisting, collecting and reducing to
possession of, any or all of the Purchased Assets and any or all
obligations of Seller and Loctite as provided herein.
<PAGE>
ARTICLE XI
CONFIDENTIALITY
11.1 Confidentiality of Buyer. Until the Closing,
Buyer shall continue to be bound by the terms of the
Confidentiality Agreement, dated August 21, 1995, between Buyer
and Dillon, Read & Co. Inc. regarding the Business.
11.2 Confidentiality of Seller. Following the
Closing, Seller and Loctite agree not to, directly or indirectly,
without the prior written consent of Buyer, use or disclose to
any person, firm or corporation other than Buyer or its
authorized representatives, any information, trade secrets,
confidential customer information, technical data or know-how
relating to the products, processes, methods, or equipment of the
Business.
ARTICLE XII
INDEMNIFICATION; SURVIVAL
12.1 Indemnification by Seller. From and after the
Closing, Seller and Loctite hereby jointly and severally agree to
defend, indemnify and hold Buyer and E-L and their officers,
directors, employees and agents, harmless from and against any
and all loss, cost, damage, claim and expense, including
reasonable attorneys' fees which Buyer and E-L or any of the
foregoing may sustain at any time by reason of (a) any debt,
liability, obligation or contract of, or claim against, the
Business, Seller or Loctite not otherwise expressly assumed by
Buyer or E-L pursuant to this Agreement, (b) a breach or
inaccuracy of or failure of Seller or Loctite to comply with, or
the existence of any facts resulting in an inaccuracy of, any of
the warranties or representations of Seller or Loctite contained
in this Agreement or in any agreement or document delivered
pursuant hereto by Seller and Loctite, (c) the failure of Seller
or Loctite to comply with any covenant or agreement of Seller or
Loctite contained in this Agreement or in any agreement or
document delivered pursuant hereto by Seller or Loctite, or
(d) any liability or obligation arising from any product sold by
Seller before the Closing Date.
12.2 Indemnification by Buyer. From and after the
Closing, Buyer and E-L hereby jointly and severally agree to
defend, indemnify and hold Seller and Loctite, and each officer,
director, employee and agent of Seller and Loctite harmless from
and against any and all loss, cost, damage, claim and expense,
including reasonable attorneys' fees, which Seller, Loctite or
any of the foregoing may sustain at any time by reason of (a) a
breach or inaccuracy of or failure of Buyer to comply with, or
the existence of any facts resulting in the inaccuracy of, any of
the warranties or representations of Buyer contained in this
Agreement or in any agreement or document delivered pursuant
hereto by Buyer, (b) the failure of Buyer to comply with any
covenant or agreement of Buyer contained in this Agreement or in
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any agreement or document delivered pursuant hereto by Buyer,
(c) any liability or obligation arising from any product sold by
Buyer on or after the Closing Date; or (d) the failure by Buyer,
after the Closing Date, to operate the Business in compliance
with applicable Environmental Laws, except with respect to any
such failure attributable to Buyer's continuation of Seller's
practices with respect to waste water pending resolution of the
Pending Regulatory Actions.
12.3 Threshold. No claim for indemnification with
respect to a breach of representation or warranty hereunder shall
be brought hereunder by Buyer or Seller until the aggregate
amount claimed by such party with respect to all such breaches
exceeds One Hundred Thousand Dollars ($100,000), provided,
however, that the foregoing shall not apply with respect to a
breach of representation or warranty by Seller or Loctite under
Section 3.15.
12.4 Environmental Indemnification.
(a) In addition to and not in lieu of any other
right or remedy that Buyer or E-L may have under this Agreement
or otherwise, from and after the Closing, Seller and Loctite
hereby jointly and severally agree to defend, indemnify and hold
Buyer and E-L and their officers, directors, employees, agents
and affiliates harmless from and against any and all loss, cost,
damage, penalty, claim or expense, including reasonable
attorney's fees which Buyer, E-L or any of the foregoing may
sustain at any time by reason of: (i) any Hazardous Substance
generated prior to the Closing Date by the Business or at the
Premises and disposed of, released, treated, stored or otherwise
handled at any location off the Premises; (ii) any Hazardous
Substance on or under the Premises (whether or not generated or
released by the Business) as of the Closing Date, including, but
not limited to, toluene or petroleum or any petroleum-related
substances; or (iii) the presence at the Premises or use by the
Business of the UST.
(b) Seller's and Loctite's obligations under this
Section 12.4 shall survive the Closing and continue for an
indefinite period from and after the Closing Date.
12.5 Breach; Arbitration. Any dispute arising under
this Agreement, including without limitation, any dispute with
respect to any claim for indemnification, (but not including any
dispute arising under Article XI or XIII) shall be settled by
arbitration in New York, New York pursuant to the rules then
obtaining of the American Arbitration Association. Such decision
of the arbitrators shall be final and binding on the parties
hereto, and may be enforced by either party in a court of
competent jurisdiction.
12.6 Survival. Each party hereto agrees that all
representations, warranties, covenants, conditions and agreements
contained herein on its part shall survive the execution and
delivery of this Agreement, the Closing hereunder and any
investigation or audit made by any party hereto. Notwithstanding
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the foregoing, neither party may assert a claim against the other
(or others) based upon a breach of the representations and
warranties contained in Article III (with respect to Seller and
Loctite) or Article IV (with respect to Buyer) after the second
anniversary of the Closing Date unless such party shall have
notified the other (or others) in writing of such breach prior to
the second anniversary of the Closing Date; provided however,
that this time limitation shall not apply to a breach of Seller's
and Loctite's representations of warranties contained in
Sections 3.3 and 3.15 of this Agreement.
12.7 Indemnification Procedure. Any party seeking
indemnification under this Article XII (the "Indemnitee") shall
notify the party or parties liable for such indemnification
(each, an "Indemnitor") in writing of any event, omission or
occurrence which the Indemnitee has determined are indemnifiable
hereunder (such written notice being hereinafter referred to as a
"Notice of Claim"). Any Notice of Claim shall be given promptly
after the Indemnitee becomes aware of such claim; provided, that
the failure of any Indemnitee to give notice as provided in this
Section 12.7 shall not relieve the Indemnitor of its obligations
under this Section 12.7, except to the extent that the Indemnitor
is actually prejudiced by such failure to give notice. A Notice
of Claim shall specify in reasonable detail the nature and any
particulars of the event, omission or occurrence giving rise to a
right of indemnification.
ARTICLE XIII
NON-COMPETITION BY SELLER
Seller and Loctite each agree, for a period of five (5)
years after the Closing Date, that it will not, anywhere in the
world, engage or become interested, directly or indirectly, as
owner, employee, partner, through stock ownership (except
ownership of less than one percent (1%) of the number of shares
outstanding of any securities which are listed for trading on any
securities exchange), investment of capital, lending of money or
property, licensing of property, rendering of services, or
otherwise, whether alone or in association with others, in the
manufacture or sale of products similar to or that compete with
any product at any time heretofore manufactured by the Business.
Seller and Loctite agree that the time period and the
geographical areas of non-competition specified in this
Article XIII are reasonable and necessary in light of the
transactions entered into pursuant to this Agreement, that breach
by Seller or Loctite of this covenant or the covenants in
Article XIII would likely cause irreparable injury to Buyer in
conducting the Business being acquired hereunder, and that in
such event Buyer shall be entitled, without limiting other
remedies available to it, to temporary and permanent injunctive
relief against Seller and Loctite in any court of competent
jurisdiction. It is understood that Seller and Loctite are
entering into this non-competition agreement in order to induce
Buyer to enter into this Agreement. If any provision in this
Article XIII shall for any reason be held to be excessively broad
<PAGE>
as to any activity or subject, it shall be construed, by limiting
and reducing it, to be enforceable to the extent compatible with
applicable law. If any provision in this Article XIII shall,
notwithstanding the preceding sentence, be held illegal or
unenforceable, such illegality or unenforceability shall not
affect any other provision of this Article XIII but this
Agreement shall be construed as if such illegal or unenforceable
provision had never been contained herein.
ARTICLE XIV
TERMINATION
This Agreement may be terminated and completion of the
transactions contemplated by this Agreement abandoned:
(a) By mutual consent of Buyer and Seller;
(b) By either Buyer or Seller if there has been a
misrepresentation or error, misstatement or omission in a
representation, or breach of any covenant or warranty, on
the part of the other party, if such event alone is, or if
such events in the aggregate are, materially adverse to the
party seeking termination;
(c) By either Buyer or Seller at any time if a
material condition precedent to the performance of the
obligations, respectively, of Seller or Buyer, hereunder
cannot be satisfied as and when required herein and will not
be waived;
(d) By either Buyer or Seller in the event of the
initiation or imminent threat by any federal, state, or
local governmental authority or by any other person of
litigation or proceedings against Buyer or Seller to enjoin,
materially hinder or delay or to obtain damages or other
material relief in connection with this Agreement or the
transactions contemplated hereby; or
(e) By either Buyer or Seller if the Closing has not
occurred by the close of business on December 1, 1995.
ARTICLE XV
MISCELLANEOUS
15.1 Entire Agreement. This Agreement, including the
Schedules and Exhibits hereto, sets forth the entire agreement
and understanding between the parties as to the subject matter
hereof and merges and supersedes all prior discussions,
agreements and understandings of every kind and nature between
them. This Agreement shall not be changed, modified or amended
except by a writing signed by the party to be charged.
<PAGE>
Seller and Buyer acknowledge that, on and after the
Closing, Seller, Buyer, E-L and certain third parties who are
parties to the Leases and Assumed Contracts may execute and
deliver agreements or instruments pursuant to which the Leases
and Assumed Contracts will be assigned to E-L with the consent of
such third parties (the "Third Party Documents"). Seller,
Loctite and Buyer agree that the terms and conditions upon which
the Leases and Assumed Contracts shall be assigned to Seller
through E-L are as set forth in this Agreement notwithstanding
the terms of any such Third Party Documents.
15.2 Governing Law. This Agreement and its validity,
construction and performance shall be governed in all respects by
the law of the State of Connecticut, without giving effect to
principles of conflict of laws.
15.3 Benefit of Parties; Assignment. This Agreement
shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and permitted
assigns. This Agreement may not be assigned by any party hereto
except with the prior written consent of the other party;
provided, however, that Buyer may assign any or all of its rights
(but may not delegate any of its obligations) under this
Agreement to E-L.
15.4 Headings. The headings in the sections,
paragraphs, Schedules and Exhibits of this Agreement are inserted
for convenience of reference only and shall not constitute a part
hereof.
15.5 Brokers. Buyer and Seller each represents to the
other that no broker or finder has been involved with any of the
transactions relating to this Agreement other than Dillon, Read &
Co. Inc. which has been retained by Seller, and Seller shall be
solely responsible for its fees and charges. In the event of a
claim by any other broker or finder that such broker or finder
represented or was retained by Seller or Buyer in connection
herewith, Seller or Buyer, as the case may be, agrees to
indemnify and hold the other harmless from and against any and
all loss, cost, damage, claim and expense, including reasonable
attorneys' fees and disbursements, which may be incurred in
connection with such claim.
15.6 Notices. All notices and other communications
provided by this Agreement shall be in writing and shall be
deemed to have been given at the time when mailed, addressed to
the address of the parties stated below or to such changed
address as such party may have fixed by notice:
To Seller or: Loctite Luminescent Systems, Inc.
Loctite c/o Loctite Corporation
Hartford Square North
10 Columbus Boulevard
Hartford, CT 06106
<PAGE>
- with a copy to -
Charles H. Lenore, Esq.
Day, Berry & Howard
CityPlace I
Hartford, CT 06103
To Buyer: Astronics Corporation
1801 Elmwood Avenue
Buffalo, NY 14207
Attn: Kevin T. Keane, President and CEO
- with a copy to -
John B. Drenning, Esq.
Phillips, Lytle, Hitchcock,
Blaine & Huber
3400 Marine Midland Center
Buffalo, NY 14203
provided, that any notice of change of address shall be effective
only upon receipt.
15.7 Severability. If any provision of this Agreement
or any Exhibit hereto shall be held invalid or unenforceable for
any reason, such holding shall not affect the validity or
enforceability of the remainder of this Agreement.
15.8 Fees and Expenses. Each party shall pay and be
responsible for all of its own fees and expenses of its counsel,
financial advisers, accountants and other experts and all other
expenses incurred by it incident to the negotiation, preparation
and execution of this Agreement and the consummation of the
transactions contemplated herein.
15.9 Counterparts. This Agreement may be
simultaneously executed in several counterparts, each of which
shall be deemed to be an original but which together shall
constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed on the day and year first above written.
Loctite Luminescent Systems, Inc.
By:JEFFREY C. PICCOLOMINI
Jeffrey C. Piccolomini,
President
Loctite Corporation
By:DAVID FREEMAN
David Freeman, President and
Chief Executive Officer
<PAGE>
Astronics Corporation
By:KEVIN T. KEANE
Kevin T. Keane, President and
Chief Executive Officer
<PAGE>
INDEX OF SCHEDULES
Schedule 1.1(b) Leases
Schedule 1.1(c) Assumed Contracts
Schedule 1.1(d) Equipment
Schedule 1.1(e) Intellectual Properties
Schedule 1.1(j) Customer Orders
Schedule 1.4 Employees of Business
Schedule 1.6 Belgium Assets
Schedule 2.3 Prepaid Expenses
Schedule 2.4 Allocation of Purchase Price
Schedule 3.1 Ownership Interests in Other Entities
Schedule 3.2 Contracts for which Consents are Required
Schedule 3.3 Purchased Assets Not at Seller's Premises
Schedule 3.4 Inventory as of 11/14/95
Schedule 3.7 Pending Worker's Compensation Claims
and Other Insurance Information
Schedule 3.8 Outstanding Purchase Orders
Schedule 3.9 Legal Proceedings
Schedule 3.12 Government Approvals, Notices and Filings
Schedule 3.13 Financial Statements
Schedule 3.15 Real Property Matters
Schedule 3.17 Labor Matters
Schedule 3.19 Licenses & Permits
Schedule 3.20 Receivables as of 11/14/95
Schedule 4.3 Government Approvals - Buyer
Schedule 5.7A Form of Release
Schedule 5.7B Form of Release
Schedule 5.8 Form of Estoppel Certificate
Schedule 6.3 Form of Seller's Counsel's Opinion
Schedule 7.3 Form of Buyer's Counsel's Opinion
Schedule 8.1 Form of Bill of Sale and Assignment
Schedule 8.5 Form of Seller's Officer's Certificate
Schedule 9.3 Form of Buyer's Undertaking
Schedule 9.4 Form of Buyer's Officer's Certificate
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