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: March 1, 1996
PUBLICKER INDUSTRIES INC.
(Exact name of registrant as specified in its charter)
Pennsylvania
(State of incorporation)
1-3315 23-0991870
(Commission file number) (I.R.S. Employer
Identification No.)
1445 East Putnam Avenue
Old Greenwich, Connecticut 06870
(Address of principal executive offices) (Zip code)
(203) 637-4500
(Registrant's telephone number, including area code)
<PAGE>
Item 5. Acquisition or Disposition of Assets
(a) On February 16, 1996, Publicker Industries
Inc. ("Publicker") sold substantially all
of the assets of its Bright Star
Industries, Incorporated ("BSI") subsidiary
to Bright Star Acquisition Corp. ("BSAC")
for $5.5 in million cash, subject to certain
post-closing adjustments which are not
expected to be material.
The assets sold include accounts
receivable, inventories, machinery,
equipment and miscellaneous furniture and
fixtures. BSAC assumed certain liabilities
of BSI including trade accounts payable,
certain accrued liabilities and certain
contractual liabilities.
BSI, located in Wilkes-Barre, Pennsylvania,
manufactures and sells flashlights,
lanterns and batteries.
Item 7. Financial Statements and Exhibits
(a) Not Applicable
(b) Not Applicable
(c) Exhibit 10.1 - Asset Purchase Agreement
among Bright Star Industries, Incorporated,
Hanten Acquisition Co., Publicker
Industries Inc. and Bright Star Acquisition
Corp. dated February 16, 1996.
<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 hereunto duly authorized.
PUBLICKER INDUSTRIES INC.
/s/Antonio L. DeLise
Antonio L. DeLise
Vice President,
Chief Financial Officer
and Secretary
Dated: March 1, 1996<PAGE>
EXHIBIT 10.1
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this "Agreement") is made this
16th day of February, 1996 among (i) Bright Star Industries,
Incorporated, a Delaware corporation with its principal executive
offices at Hanover Industrial Estates, 380 Stewart Road, Wilkes-Barre,
Pennsylvania 18706 as seller ("Seller"), (ii) Publicker
Industries Inc., a Pennsylvania corporation with its principal
executive offices at 1445 East Putnam Avenue, Old Greenwich,
Connecticut 06870, ("Publicker"), (iii) Hanten Acquisition Co., a
Delaware corporation with its principal executive offices at 1445
East Putnam Avenue, Old Greenwich, Connecticut 06870 (the "Parent",
and together with Publicker, the "Shareholders"), and (iv) Bright
Star Acquisition Corp., a Delaware corporation with its principal
executive offices at c/o BancBoston Ventures Inc., 100 Federal
Street, Boston, Massachusetts 02110, as buyer ("Buyer").
RECITALS:
WHEREAS, Seller is engaged in the "Business" (as hereinafter
defined);
WHEREAS, Publicker owns all of the issued and outstanding
shares of stock of Parent and Parent owns all of the issued and
outstanding shares of stock of Seller; and
WHEREAS, Seller desires to sell, transfer and assign to
Buyer, and Buyer desires to purchase and acquire from Seller, on
the terms and subject to the conditions set forth in this
Agreement, substantially all of the assets used in the conduct of
the Business.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements hereinafter set forth, and intending to be legally
bound, the parties hereto agree as follows:
1. Interpretation.
A. Definitions. As used in this Agreement, the following
terms shall have the following meanings:
"Business" shall mean the business in which the Seller is
engaged on the Closing Date, as described in Schedule 1.A.1.
hereto, at the locations listed in Schedule 1.A.2. hereto.
"Know-How" shall mean all know-how and information (not
necessarily proprietary) used by Seller in the Business on the
Closing Date including, without limitation, (1) design drawings,
(2) specifications and performance criteria, (3) operating
instructions and maintenance manuals, (4) manufacturing information
including production documentation, methods, layouts and supplier
and cost information, (5) copies of on-site computer software and
related documentation, including, without limitation, source and
object code to the extent available, (6) prototypes, models or
samples, (7) files relating to applications for Intellectual
Property Rights, and (8) all files relating to customers and other
tangible materials that are used in the Business on the Closing
Date.
"Copy Rights" shall mean all published and unpublished rights
in works of authorship including, without limitation, (1) literary
works, including books, periodicals, catalogs, directories, textual
advertising such as brochures, pamphlets and other literature,
tabular lists, lectures, manuals and computer programs and data
bases; (2) pictorial, graphic and sculptural works, including maps,
architectural plans and renderings, blueprints, photographs, prints
and pictorial illustrations such as labels and pictorial
advertising, posters, brochures and pamphlets, and pattern designs;
(3) audiovisual works; (4) sound/recordings; and (5) mask works,
and all U.S. pending and issued copyright or mask work
registrations thereon.
"Patent Rights" shall mean all (1) rights to
inventions/conceived on or before the Closing Date by employees of
the Seller who are engaged solely in the operation of the Business;
(2) pending U.S. and foreign applications owned by the Seller; and
(3) U.S. and foreign patents owned by the Seller, or for which the
Seller has the right to apply for as of the Closing Date.
"Trademarks" shall mean trade names, trademarks, service
marks, trade dress and product configurations that are used by the
Seller to identify the Business or any part thereof and all
(1) goodwill and associated common law rights; (2) registration
applications pending thereon in any province, state or country; and
(3) registrations issued thereon.
"Trade Secrets" shall mean all proprietary information that
is used by the Seller in the Business and that (1) derives
independent economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by, third
parties who can obtain economic value from its disclosure or use
and (2) is the subject of efforts by the Seller that were
reasonable under the circumstances to maintain its secrecy, such
as, without limitation, proprietary specifications, formulas,
drawings, models, blueprints, software, production techniques and
processes, retail and wholesale customer lists, vendor lists,
compilations, merchandising information, cost and pricing
information, business systems and methods.
"Intellectual Property Rights" shall mean the Patent Rights,
Copy Rights, Trademarks and Trade Secrets as more fully described
herein and other similar rights in technology that are in each case
used by the Seller in the Business, including, without limitation,
those items set forth in Schedule 1.A.3 hereto.
2. Sale of Assets and Assumption of Liabilities.
A. Assets Sold and Retained.
1. Assets Purchased. At the Closing, Seller agrees
to sell, transfer, convey, assign and deliver to Buyer and
Buyer agrees to purchase and acquire, according to the terms
and conditions of this Agreement, all of Seller's right,
title, and interest in and to all of the assets and
properties, other than the assets identified in Section 2.A.2
hereof, of the Seller (collectively, the "Purchased Assets"),
including, without limitation, the following:
(a) all personal property leases listed
on Schedule 2.A.1.a hereto (the "Personal Property
Leases") and all real property leases listed on
Schedule 2.A.1.a hereto (the "Real Property Leases")
and all leasehold improvements and structures on the
real property leased thereby, and, to the extent
covered by the Real Property Leases, any and all
fixtures, machinery, installations, equipment and other
property attached thereto or located thereon (the
"Leased Real Property");
(b) all contracts of the Business,
including, without limitation, customer contracts,
royalty and license agreements and rights, contracts
and agreements for the purchase or sale of utilities,
goods, materials and services, rights to use technology
owned by others and certain other agreements, including
without limitation the contracts listed on Schedule 4.K
other than the contracts indicated on Schedule 4.K as
contracts which the Buyer is not assuming,
(collectively, the "Contracts");
(c) all prepaid expenses and deposits of
the Business;
(d) all accounts receivable of the
Business or other rights to receive payment for
services provided by the Business as of the Closing
Date (the "Closing Date Receivables");
(e) all inventory of supplies, raw
materials, component parts, work-in-progress and
finished goods of the Business on hand (the
"Inventory");
(f) all plants, fixtures, machinery,
installations, equipment, tools, spare parts, fittings,
supplies, injection molds for manufacturing flashlight
lantern parts, and other tangible personal property
used in the Business, including without limitation,
those items described on Schedule 4.R hereto, (the
"Equipment");
(g) all on-site computer hardware and
software owned by the Seller and used in the Business
at the locations identified in Schedule 1.A.2 hereto
(the "Computer Hardware and Software");
(h) all goodwill of the Business;
(i) the Know-How;
(j) the Intellectual Property Rights and
all business names, including the right to use the name
"Bright Star Industries Incorporated" or derivations
thereof in the conduct of the Business and other
intangible assets relating to the Business set forth
on Schedule 2.A.1.j attached hereto;
(k) all operating data, books and records
of Seller, including employment and personnel records,
customer lists and information, relating to customers
and suppliers, with respect to the Business;
(l) to the extent assignment to the Buyer
is permitted by law or contract, all rights, licenses,
permits, and other operating agreements (in each case,
both governmental and private) with respect to the
Seller's right to provide services of the Business at
the locations identified in Schedule 1.A.2 hereto or
for which the Seller is the licensee, including without
limitation those set forth on Schedule 4.F attached
hereto, (the "Licenses and Permits");
(m) all of the Seller's rights under any
agreements with respect to the employee plans described
on Schedule 2.A.1.m hereto (the "Assumed Benefit
Arrangements"); and
(n) all other assets, whether tangible or
intangible that are used by Seller in the Business
except as excluded by Section 2.A.2 (the "Other
Assets").
2. Assets Retained. Notwithstanding the provisions
of Section 2.A.1, the Seller is not selling, assigning,
transferring or conveying to Buyer the following assets,
which shall be excluded from the transactions contemplated
by this Agreement (the "Excluded Assets"):
(a) all receivables from either of the
Shareholders or any of their subsidiaries or
affiliates;
(b) all cash, and cash equivalents and
investment securities;
(c) all prepaid expenses and deposits of
the Business to the extent not included in the Closing
Date Balance Sheet;
(d) subject to Section 6.C.1 hereof, all
of the Seller's pension plan or 401(k) plan assets;
(e) insurance policies of the Seller,
except for those policies specifically listed on
Schedule 2.A.2.e; and
(f) all federal, state and local income
or franchise tax refunds, deposits or credits.
3. Transfers of Personal Property Leases, Real
Property Leases and Contracts. To facilitate the assignment
or transfer of Personal Property Leases, Real Property Leases
and Contracts, Seller shall execute such documents of
assignment or transfer as may be prepared by Buyer and
reasonably acceptable to Seller (and which shall not impose
any liability or obligation on Shareholders or Seller) that
are necessary or appropriate for evidencing or recording the
assignments or transfers to Buyer. Buyer agrees to provide
insurance certificates to the Seller of such type, at such
times and in the manner required to be delivered to the
lessor by the lessee under the Real Property Leases. Subject
to the terms of Section 2.E hereof, in the event any
assignment or transfer of any Personal Property Lease, Real
Property Lease or Contract cannot be obtained, Seller and
Buyer shall enter into a mutually satisfactory license,
sublicense, lease, or independent contractor agreement,
agency or other relationship with respect hereto with the
intent of providing the same benefits and obligations to
Buyer as if such assignment had occurred.
4. Transfer of Know-How. The communication of
transferred Know-How from Seller to Buyer shall occur
primarily through Buyer's acquisition of property and
engagement of Seller's personnel, provided that Seller shall
have no responsibility to insure that any of its employees
become the employees of Buyer. In addition, in order to
facilitate the transfer of such Know-How, Seller shall use
reasonable efforts, for a period of two (2) years from the
Closing Date, to provide to Buyer, upon Buyer's written
request, copies of any documents or other information in
Seller's possession, defining or specifying the subject
matter, nature and extent of the Know-How and take such other
action as the parties mutually agree is reasonably necessary
or appropriate to effectuate the transfer of such Know-How.
B. Assignment of Intellectual Property Rights. On the
Closing Date, Seller shall execute and deliver assignments with
respect to the Intellectual Property Rights set forth on Schedule
1.A.3, including all goodwill associated therewith.
C. Risk of Loss. The risk of loss and all obligations to
insure the tangible assets of the Business shall remain with Seller
until the Closing, and shall transfer from Seller to Buyer at the
time of Closing.
D. "As Is" Condition. EXCEPT AS EXPRESSLY SET FORTH IN
THIS AGREEMENT, THE PURCHASED ASSETS ARE BEING SOLD "AS IS" AND
"WHERE IS" AND "WITH ALL DEFECTS" WITHOUT ANY REPRESENTATION OR
WARRANTY WHATSOEVER, EXPRESS OR IMPLIED.
E. Assumption of Contractual Rights and Obligations
Related Thereto. At the time of Closing, the Buyer shall assume,
and hereby agrees to perform, the rights and obligations, and any
other contractual obligations pursuant to the Personal Property
Leases, Real Property Leases, the Contracts, bids, quotations,
proposals and similar agreements entered into or made in the
ordinary course of Business hereto (collectively, the "Transferred
Rights, Obligations and Agreements"), which are assigned to the
Buyer to the extent the obligations arise or are to be performed
following the Closing Date.
To the extent that the assignment hereunder of any of the
Transferred Rights, Obligations, Agreements or the assignment under
Section 2.B above shall require the consent of any other party (or
in the event that any of the same shall be non-assignable), neither
this Agreement nor any actions taken hereunder shall constitute an
assignment or an agreement to assign if such assignment or
attempted assignment would constitute a breach thereof or result
in the loss or diminution thereof; provided, however, that in each
such case, the Seller and the Buyer shall use commercially
reasonable efforts to obtain the consent of such other party to an
assignment to the Buyer.
If such consent is not obtained, the Seller shall cooperate
with the Buyer in a reasonable arrangement designed to provide the
Buyer with the benefits and burdens of any such Transferred Rights,
Obligations and Agreements and under the Intellectual Property
Rights, including appointing the Buyer to act as its agent to
perform all of the Seller's obligations under such Transferred
Rights, Obligations and Agreements and to collect and promptly
remit to the Buyer all compensation received by Seller pursuant to
those Transferred Rights, Obligations and Agreements and to
enforce, for the account and benefit of the Buyer, any and all
rights of the Seller against any other person arising out of the
breach or cancellation of such Transferred Rights, Obligations and
Agreements by such other person or otherwise (any and all of which
arrangements shall constitute, as between the parties hereto, a
deemed assignment or transfer); provided that, to the extent that
Seller is required to undertake any services or take any actions
in furtherance of the performance of such Transferred Rights,
Obligations and Agreements, any such services or actions shall be
the subject of a separate agreement that the parties shall, in good
faith, negotiate as promptly as possible and which shall be
mutually acceptable to the parties.
F. Assumption of Certain Liabilities by Buyer. From and
after the Closing, Buyer shall, without any further responsibility
or liability of or recourse to Seller, or any of its affiliates or
their respective directors, shareholders, officers, employees,
agents, consultants, representatives, successors, transferees or
assignees, assume and be solely liable and responsible for the
following liabilities and obligations arising out of the ownership
of the Purchased Assets or the operation of the Business (the
"Assumed Liabilities"):
1. all liabilities and obligations of Seller under
all Personal Property Leases, Contracts and all other of the
Transferred Rights, Obligations and Agreements assigned or
transferred to Buyer pursuant to Section 2.A hereof (or
deemed assigned or transferred pursuant to Section 2.E
hereof) which arise or are to be performed following the
Closing Date, but excluding the "Excluded Liabilities" (as
defined in Section 2.G hereof);
2. all trade accounts payable and accrued
liabilities of the Seller reflected on the unaudited
November 30, 1995 balance sheet of the Seller to the extent
that such accounts payable and accrued liabilities remain
outstanding at the Closing, but excluding any Excluded
Liabilities;
3. all trade accounts payable and accrued
liabilities of the type set forth on the unaudited November
30, 1995 balance sheet of the Seller incurred by the Seller
in connection with the Business in the ordinary course of
business subsequent to November 30, 1995 and through the
Closing Date to the extent accrued in accordance with GAAP
and reflected on the Closing Balance Sheet, but excluding any
Excluded Liabilities; and
4. liabilities of the Seller for any contractual
product warranty claim with respect to any product sold or
manufactured by the Seller prior to the Closing Date solely
to the extent of any reserve therefor on the Final Closing
Balance Sheet.
The assumption by Buyer of the Assumed Liabilities and the
transfer thereof by Seller shall in no way expand the rights or
remedies of any third party against Seller or Buyer as compared to
the rights and remedies which such third party would otherwise have
had.
G. All Other Liabilities Excluded. Notwithstanding the
foregoing, Seller agrees that Buyer is assuming only those
liabilities and obligations enumerated in Section 2.F and no others
and Buyer and its affiliates and their respective directors,
shareholders, officers, employees, agents, consultants,
representatives, successors and transferees or assignees, shall
have no liability or responsibility for any liability or obligation
arising out of Seller's ownership or operation of the Purchased
Assets or the Business prior to the Closing Date (except as
expressly provided in Section 2.F), including, without limitation,
the following liabilities and obligations of Seller (the "Excluded
Liabilities"):
1. any obligation of the Seller to either of the
Shareholders or any of their subsidiaries or affiliates;
2. any current or long-term liability or obligation
of the Seller with respect to indebtedness for borrowed money
and any related debt issuance costs and with respect to any
uncleared checks issued by the Seller which are outstanding
on the Closing Date (all of which will be paid by Seller);
3. any liability or obligation of the Seller for
federal, state or local income or franchise taxes;
4. any liability with respect to any of the matters
disclosed on Schedules 4.A (other than any Permitted
Encumbrances), 4.G, 4.L, and 4.O hereto; and
5. any liability for any contractual product
warranty claim with respect to any product sold or
manufactured by Seller prior to the Closing Date, to the
extent that such liability exceeds the reserve therefor on
the Final Closing Balance Sheet ("Warranty Claims").
3. Purchase Price: Payment: Adjustment.
A. Purchase Price. The purchase price for the sale and
transfer of the Purchased Assets shall be Five Million Five Hundred
Thousand Dollars ($5,500,000), plus the assumption of the Assumed
Liabilities set forth in Section 2.F hereof, subject to adjustment
as provided in Section 3.C (the "Purchase Price").
B. Payment of Purchase Price. At the Closing, (i)
$200,000 of the Purchase Price (the "Escrowed Funds") shall be
deposited by Buyer into an Escrow Account to be established in
accordance with the terms of an escrow agreement in the form of
Exhibit A hereto (the "Escrow Agreement") and (ii) $5,300,000,
which represents the balance of the Purchase Price (the "Cash
Purchase Price") shall be paid by Buyer to Seller in immediately
available funds.
C. Adjustment to and Payment of the Balance of the
Purchase Price. The Purchase Price has been derived by and agreed
upon by the parties based on the Net Book Value (as defined below)
as set forth on the balance sheet of Seller as of November 30,
1995, as shown on Exhibit B hereto (the "Opening Balance Sheet").
The Purchase Price is subject to a dollar for dollar adjustment,
upward or downward, based upon the change in the Net Book Value as
set forth on the Final Closing Balance Sheet (as defined below)
from that shown on the Opening Balance Sheet ($3,762,000). Such
adjustment shall be the "Differential." The Differential shall be
determined as follows:
1. Within forty-five (45) days after the Closing
Date, Seller shall prepare and deliver to Buyer an unaudited
balance sheet (the "Final Closing Balance Sheet") showing the
Net Book Value as of the close of business on the Closing
Date immediately prior to giving effect to the Closing (the
"Final Book Value"). The Final Closing Balance Sheet shall
be prepared in accordance with GAAP. Inventories included
on the Final Closing Balance Sheet shall be valued on the
basis of a physical inventory conducted by the Buyer and the
Seller, with their respective independent accountants, within
two (2) days following the Closing Date. Following delivery
of the Final Closing Balance Sheet by Seller, Seller shall
cooperate with the Buyer's independent accountants in
connection with their review of the Final Closing Balance
Sheet and shall permit the Buyer's accountants to review and
make copies of all work papers, schedules and calculations
used in the preparation thereof.
2. When the Seller delivers the Final Closing
Balance Sheet, the Seller shall also deliver a certificate
(i) certifying that the Final Closing Balance Sheet was
prepared in accordance with GAAP in accordance with the
procedures set forth in paragraph 1 above and (ii) containing
the Seller's calculations, based on the Final Closing Balance
Sheet (the "Seller's Proposed Calculations") of the Net Book
Value as of the Closing Date.
3. Within forty-five (45) days after receipt of the
Final Closing Balance Sheet and the accompanying certificate,
the Buyer shall notify the Seller of its agreement or
disagreement with the Final Closing Balance Sheet and the
accuracy of any of the Seller's Proposed Calculations.
During such forty-five (45) day period, the Buyer shall have
the right to direct its independent accountants, at the
Buyer's expense, to review and test the Final Closing Balance
Sheet. If the Buyer, after such review and test, disagrees
with the Seller's Proposed Calculations, and the Seller does
not accept the Buyer's proposed alternative calculations (the
"Buyer's Proposed Calculations"), then, within thirty (30)
days after the date of the Seller's rejection of the Buyer's
Proposed Calculations, the Seller and the Buyer shall select
another nationally recognized independent accounting firm
(other than the Seller's independent accountants and the
Buyer's independent accountants) to resolve the remaining
disputed items (the "Remaining Disputed Items") by conducting
its own review and test of the Final Closing Balance Sheet
and thereafter selecting either the Buyer's Proposed
Calculations of the Remaining Disputed Items or the Seller's
Proposed Calculations of the Remaining Disputed Items or an
amount in between the two. Each of the Buyer and the Seller
agree that it shall be bound by such other accounting firm's
determination of the Remaining Disputed Items. The fees and
expenses of such accounting firm shall be paid jointly by the
Buyer and the Seller, provided that if the difference between
the Final Adjustment (as defined below) and the Final
Adjustment that would have resulted from the use of the
Proposed Calculations of one of the parties hereto (the
"Erroneous Party") is more than twice as great as the
difference between the Final Adjustment and the Final
Adjustment that would have resulted from the use of the other
party's Proposed Calculations, the Erroneous Party shall pay
all of the fees and expenses of such accounting firm.
4. Upon the determination pursuant to paragraph 3 of
this Section 3.C of the Final Closing Balance Sheet and Net
Book Value as of the Closing Date, the Purchase Price shall
be adjusted in accordance with this paragraph 4. If the Net
Book Value as of the Closing Date as reflected on the Final
Closing Balance Sheet (the "Closing Date Net Book Value") is
greater than $3,762,000, the Buyer shall pay the amount of
such excess to the Seller in cash and all of the Purchase
Price Escrow Amount (as defined in the Escrow Agreement)
shall be released to the Seller. If the Closing Date Net
Book Value is less than $3,762,000 and the amount of such
difference is less than the Purchase Price Escrow Amount, the
Seller shall pay the amount of such difference to the Buyer
by releasing the Purchase Price Escrow Amount to the extent
sufficient to cover such payment and the balance of the
Purchase Price Escrow Amount shall be released to the Seller.
If the Closing Date Net Book Value is less than $3,762,000
and the amount of such difference is greater than the
Purchase Price Escrow Amount, the Seller shall pay the amount
of such difference to the Buyer by releasing all of the
Purchase Price Escrow Amount to the Buyer and by paying the
balance of such difference in cash to the Buyer. Any
adjustment to the Purchase Price made pursuant to this
paragraph 4 is referred to herein as the "Final Adjustment".
Any such payment and release of the Purchase Price Escrow
Amount shall be made within ten (10) days after the
determination of the Final Adjustment pursuant to this
paragraph 4.
5. For the purposes of preparing the Opening Balance
Sheet and the Final Closing Balance Sheet, the following
accounts and all other Excluded Assets and Excluded
Liabilities have been and will be excluded therefrom:
(i) cash;
(ii) goodwill;
(iii) accrued income taxes; and
(iv) inter-company accounts.
6. For purposes of this Section 3.C, (a) the term
"GAAP" means generally accepted accounting principles applied
on a basis consistent with the Financial Statements and (b)
the term "Net Book Value," with respect to any balance sheet
of the Seller, shall mean the Purchased Assets less the
Assumed Liabilities, in each case as set forth on such
balance sheet.
7. Notwithstanding any other provision of this
Agreement, Buyer's sole and exclusive remedy in connection
with any disagreement with the Final Closing Balance Sheet,
Seller's Proposed Calculations or any certificate delivered
by Seller pursuant to this Section 3.C shall be to invoke the
dispute resolution mechanism set forth in paragraph 3 of this
Section 3.C, and Buyer shall not be entitled to seek
indemnification pursuant to Section 8 hereof in connection
with any of the foregoing.
D. Closing Date. The closing of this transaction shall
take place on or before February 16, 1996 (herein the "Closing or
"Closing Date"), at which time the transfer of title to and
possession of the Purchased Assets shall occur and the payment of
the Purchase Price as set forth in Section 3.B shall occur. At the
Closing, each of the parties hereto shall execute and deliver all
consideration, instruments and documents reasonably required to
carry out the terms and provisions of this Agreement. Possession
of all of the Purchased Assets shall be delivered to Buyer by
Seller immediately upon the Closing. The Closing shall take place
in the offices of Bingham, Dana & Gould, 150 Federal Street,
Boston, Massachusetts at 10:00 a.m. local time on February 16, 1996
or at an earlier date and time to be mutually agreed upon between
the parties.
E. Waiver of Bulk Transfer Provisions. Buyer hereby
waives compliance with all provisions of the Bulk Sales Laws of
Pennsylvania, if applicable to the transactions herein
contemplated, and in consideration of such waiver Seller agrees to
indemnify Buyer against and hold it harmless from any and all loss,
cost, damage, liability, deficiency or expense resulting from or
arising out of such noncompliance to the extent not involving an
Assumed Liability, provided that the provisions of Section 8.C
hereof shall apply to this indemnity as if it were set forth
therein.
4. Representations and Warranties of Seller and Shareholders.
In order to induce Buyer to enter into this Agreement and to
consummate the transactions contemplated hereunder, Seller and
Shareholders, jointly and severally, represent and warrant to
Buyer, as follows:
A. Title to Assets. Seller has, and will have on the
Closing Date, good and marketable title to and legal right and
power to convey all of the Purchased Assets being transferred
hereby, free and clear of any and all mortgages, liens, pledges,
security interests, privileges, charges, claims or encumbrances of
every kind, nature and description (collectively, "Encumbrances")
except as set forth on Schedule 4.A attached hereto. Upon the
consummation of the transactions contemplated hereby, Buyer will
acquire (i) good title to the Purchased Assets owned by Seller,
free and clear of any Encumbrances and (ii) the right to use, and
valid leasehold interest in, any of the Purchased Assets not owned
by Seller, in each case subject to the liens, rights of others and
lease agreements reflected on Schedule 4.A (the "Permitted
Encumbrances").
B. Organization and Qualification. Seller is a
corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware with corporate power to own
its properties and to carry on its business as it is now being
conducted and Seller is duly qualified to transact business and is
in good standing as a foreign corporation in the Commonwealth of
Pennsylvania and the States of California and New Jersey.
C. Power and Authority. Each of Seller and Shareholders
has the corporate power to execute and deliver this Agreement, the
Escrow Agreement and the other documents and instruments
contemplated hereby (the "Transaction Documents") and to incur and
perform its obligations hereunder and thereunder. The execution,
delivery and performance of the Transaction Documents and the
transactions contemplated hereby and thereby have been duly
authorized by all necessary corporate action on the part of Seller
and Shareholders, and each of the Transaction Documents is the
legal, valid and binding obligation of each of Seller and
Shareholders, enforceable in accordance with its terms.
D. Approvals and Consents; Noncontravention. The
execution, delivery, and performance of the Transaction Documents
by Seller and Shareholders and the consummation of the transactions
contemplated hereby and thereby by Seller and Shareholders, will
not (i) violate any statute, regulation or ordinance of any
governmental authority or require any filing with or authorization,
consent or approval of any government or governmental agency,
(ii) conflict with, result in the breach of, or constitute a
violation or default under any of the provisions of the respective
Articles of Incorporation or By Laws of Seller and Shareholders,
(iii) conflict with or result in a breach of any material
agreement, deed, contract, mortgage, indenture, writ, order,
decree, contractual obligation or instrument to which Seller or
Shareholders is a party or by which either of them or any of the
Purchased Assets are or may be bound, or constitute a default (or
an event which with the lapse of time or the giving of notice, or
both, would constitute a default) thereunder, or (iv) result in the
creation or imposition of any lien, charge or encumbrance, on or
with respect to the Purchased Assets.
E. Tax Returns; Withholdings. Seller has filed all
federal tax returns and all state and any foreign or local tax
returns which are required to have been filed, and has paid all
taxes and governmental charges shown thereon as due. All amounts
required to be withheld by Seller from employees for income tax,
social security contributions, unemployment tax and workers'
compensation have been withheld and either (i) have been paid to
the appropriate governmental agencies or (ii) will be paid by the
Seller to the appropriate governmental agencies when due.
F. Compliance with Laws; Permits. At all times since
February 8, 1991, Seller has complied in all material respects with
all applicable laws and regulations of foreign, federal, state and
local governments and all agencies thereof and all orders,
judgments, injunctions, decrees or similar commands, in each case
that affect the Business or the Purchased Assets, and no claims
have been filed alleging a material violation of any such law,
regulation, order, judgment, injunction or decree. Seller holds,
and the Licenses and Permits listed on Schedule 4.F constitute, all
of the material permits, licenses, certificates and other
authorizations of foreign, federal, state and local governmental
agencies necessary to conduct the Business as it is presently being
conducted or required in connection with the ownership of the
Purchased Assets. All such permits, licenses and certificates are
in full force and effect, and Seller has not since January 1, 1995
received any notice of intent to revoke or not to renew any of such
permits, licenses and certificates. Except as expressly designated
on Schedule 4.F hereto, all of the Licenses and Permits are
transferable to Buyer and true and complete copies of such Licenses
and Permits as are listed on Schedule 4.F have previously been
delivered to Buyer.
G. Litigation. There are no legal actions, suits,
arbitrations or other legal, administrative or other governmental
proceedings pending against or affecting Seller, the Business or
the Purchased Assets, and, to Seller's knowledge, there are no
legal actions, suits, arbitrations or other legal, administrative
or other governmental proceedings threatened against or affecting
Seller, the Business or the Purchased Assets which could reasonably
be expected to have a material adverse effect on the Business or
the ability of Seller to consummate the transactions contemplated
hereby, in each case at law or in equity or by or before any
governmental department, commission, board, agency, bureau,
tribunal or instrumentality, except as shown on Schedule 4.G
attached hereto ("Litigation").
H. Financial Statements. Seller has delivered to Buyer
copies of the unaudited financial statements of the Seller, as of
November 30, 1995 ("Financial Statements"). The Financial
Statements (i) have been prepared from and are in accordance with
the Seller's books and records and (ii) fairly present in all
material respects the financial condition or results of operations
of Seller as of the relevant dates thereof and for the periods
covered thereby in accordance with generally accepted accounting
principles and Seller's accounting practices, policies and
procedures, applied on a consistent basis throughout the periods
indicated. The Opening Balance Sheet, attached hereto as Exhibit
B, was prepared from the Financial Statements in accordance with
this Section 4.H to reflect the elimination of (i) cash balances,
(ii) goodwill, (iii) accrued income taxes, (iv) intercompany
account balances and (v) all other Excluded Assets and Excluded
Liabilities.
I. Absence of Undisclosed Liabilities. Except for the
obligations or liabilities (i) disclosed or referred to in the
Opening Balance Sheet, or (ii) incurred by Seller with respect to
the Business in the ordinary course of business after the date of
the Opening Balance Sheet and either discharged prior to the
Closing or reflected or reserved against on the Final Closing
Balance Sheet, there are no obligations or liabilities arising out
of or relating to transactions or events with respect to the
Business entered into or occurring prior to the date hereof that
would be required to be reserved against or disclosed in a balance
sheet of Seller prepared in a manner consistent with the
preparation of the Opening Balance Sheet.
J. Personnel.
1. Compensation. Schedule 4.J.1 hereto sets forth
a complete and accurate list of (a) each employee of the
Seller and the rate and amount of the compensation paid to
such employee for the fiscal year ended December 31, 1995,
and (b) the rate and amount of such compensation paid to each
such employee through January 31, 1996. There have been no
changes in such compensation since such date. Except as
listed in Schedule 4.J.1 hereto, the Seller has no employment
agreement, written or oral, with any currently active
employee, including any agreement to provide any bonus or
benefit to any such employee. Except as set forth on
Schedule 4.J.1, since November 30, 1995, the Seller has not
made any pension, bonus or other payment, other than base
salary, or become obligated to make any such payment, to any
employee of the Seller. Except as set forth on
Schedule 4.J.1, the Seller has no outstanding loans or
advances to employees.
2. Employee Benefit Plans.
(a) Except as set forth on Schedule 4.J.2
hereto, neither the Seller nor any trade or business
(whether or not incorporated) that is a member of a
group described in Section 414(b) or Section 414(c) of
the United States Internal Revenue Code of 1986, as
amended (the "Code"), of which the Seller is a member
(a "Related Entity") maintains or has any obligation
to make contributions to any employee benefit plan
within the meaning of Section 3(3) of the United States
Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), or any other retirement, profit
sharing, deferred compensation, stock option, bonus,
share appreciation right, severance, group or
individual health, dental, medical, life insurance,
survivor benefit or other benefit program for officers,
employees, consultants or directors, current or former,
of the Business. Each employee benefit plan (within
the meaning of Section 3(3) of ERISA) set forth on
Schedule 4.J.2 hereto, other than any such plan which
is a multiemployer plan as defined at Section 3(37) or
Section 4001(a)(3) (a "Multiemployer Plan"), is
hereinafter referred to as an "ERISA Plan", and each
other plan, program or arrangement set forth on
Schedule 4.J.2 hereto (other than any such plan,
program or arrangement that is a Multiemployer Plan)
is hereinafter referred to as a "Non-ERISA Plan". The
Seller has heretofore delivered to the Buyer true,
correct and complete copies of each ERISA Plan and of
each Non-ERISA Plan and, with respect to any such Plan
which is an Assumed Benefit Arrangement, copies of
(i) any associated trust, custodial, insurance or
service agreements, (ii) any annual report, actuarial
report or disclosure materials (including any summary
plan descriptions) submitted to any governmental agency
or distributed to participants or beneficiaries
thereunder in the current or any of the six (6)
preceding calendar years and (iii) the most recently
delivered IRS determination letter, and any other
governmental advisory opinions or rulings applicable
to such Plan. All ERISA Plans and Non-ERISA Plans
which are Assumed Benefit Arrangements have been
maintained and operated in material compliance with all
federal, state and local laws and regulations
applicable to such plans, and the terms and conditions
of the respective plan documents.
(b) Neither the Seller nor any Related
Entity has engaged in any transaction with or involving
an Assumed Benefit Arrangement in connection with which
it could be subject to either a civil penalty assessed
pursuant to Section 502(i) of ERISA, or a tax imposed
by Section 4975 of the Code or any tax or penalty under
any federal, state or local laws applicable to any Non-ERISA
Plan which is an Assumed Benefit Arrangement.
Except as otherwise noted in Schedule 4.J.2 hereto, no
ERISA Plan is subject to Title IV of ERISA. Neither
the Seller nor any Related Entity has incurred, or is
expected to incur, any material liability to the United
States Pension Benefit Guaranty Corporation ("PBGC"),
any Multiemployer Plan or to any other governmental
authority, pension or retirement board, or other
agency, under any federal, state or local law.
(c) Full payment has been made of all
amounts that the Seller or any Related Entity is
required, under the terms of each ERISA Plan, Non-ERISA
Plan and Multiemployer Plan which is an Assumed Benefit
Arrangement, or pursuant to applicable federal, state
or local law, to have paid as contributions to such
ERISA Plan, Non-ERISA Plan or Multiemployer Plan (as
the case may be) as of the last day of the most recent
fiscal year of such ERISA Plan, Non-ERISA Plan or
Multiemployer Plan (as the case may be) ended prior to
the date hereof, and no accumulated funding deficiency
(as defined in Section 302 of ERISA and Section 412 of
the Code), whether or not waived, exists with respect
to any ERISA Plan.
(d) Except as set forth on
Schedule 4.J.2 hereto,
(i) no action, suit,
proceeding or investigation is pending or
threatened against the Seller, other than
routine claims for benefits, concerning any
Assumed Benefit Arrangement or, to the best
knowledge of the Seller and the Shareholders,
any fiduciary or service provider thereof and,
to the best knowledge of the Seller and the
Shareholders, there is no basis for any such
legal action or proceeding;
(ii) no communication, report
or disclosure has been made which, at the time
made, did not accurately reflect the terms and
operations of any Assumed Benefit Arrangement;
(iii) no Assumed Benefit
Arrangement provides welfare benefits subsequent
to termination of employment to employees or
their beneficiaries (except to the extent
required by applicable state insurance laws and
Title I, Part 6 of ERISA and Section 4980(B) of
the Code);
(iv) no benefits due under any
Assumed Benefit Arrangement have been forfeited
subject to the possibility of reinstatement
(which possibility would still exist on or after
the Closing Date); and
(v) the Seller has not
undertaken to maintain any Assumed Benefit
Arrangement for any period of time and each such
Arrangement is terminable at the sole discretion
of the sponsor thereof, subject only to such
constraints as may be imposed by applicable law.
(e) Effect of Transactions. The
execution of this Agreement and the consummation of the
transactions contemplated hereby will not result in any
payment (whether of severance pay or otherwise)
becoming due from any ERISA Plan or Non-ERISA Plan of
the Seller to any current or former director, officer,
consultant or employee of the Seller or result in the
vesting, acceleration of payment or increases in the
amount of any benefit payable to or in respect of any
such current or former director, officer, consultant
or employee.
K. Contracts. Schedule 4.K sets forth a complete and
accurate list of all contracts to which the Seller is a party or
by which the Seller is bound or to which the Seller or any of the
Purchased Assets is subject (the "Material Agreements"), except
(a) contracts or purchase orders for goods and services entered
into in the ordinary course of business which have a remaining term
of less than one year and each of which does not require payments
in the aggregate by any party thereto of more than $10,000,
(b) contracts terminable by the Seller upon 30 days' notice or less
without the payment of any termination fee or penalty, and
(c) contracts listed in other Schedules hereto. As used in this
Section 4.K, the word "contract" means and includes every agreement
or understanding of any kind, written or oral, which is legally
enforceable by or against the Seller, and specifically includes
(a) contracts and other agreements with any current or former
officer, director, employee, consultant or shareholder or any
partnership, corporation, joint venture or any other entity in
which any such person has an interest; (b) agreements with any
labor union or association with respect to the representation of
any employee; (c) contracts and other agreements for the provision
of services by the Seller; (d) bonds or other security agreements
provided by any party in connection with the business of the
Seller; (e) contracts and other agreements for the sale of any of
the Seller's assets or properties other than in the ordinary course
of business or for the grant to any person of any preferential
rights to purchase any of the Seller's assets or properties;
(f) joint venture agreements relating to the assets, properties or
business of the Seller or by or to which it or any of its assets
or properties are bound or subject; (g) contracts or other
agreements under which the Seller agrees to indemnify any party,
to share tax liability of any party, or to refrain from competing
with any party; (h) any contracts or other agreements with regard
to indebtedness for borrowed money; or (i) any other contract or
other agreement whether or not made in the ordinary course of
business. The Seller has delivered to the Buyer true, correct and
complete copies of all Material Agreements, together with all
modifications and supplements thereto. All of the Material
Agreements are in full force and effect, and no breach or default
by Seller or, to the best of Seller's knowledge, by any other party
has occurred with respect thereto. Except as identified on
Schedule 4.K, no approval or consent of any person is needed in
order that the Material Agreements continue in full force and
effect following the assignment of such contracts to the Buyer
pursuant to this Agreement.
L. Employment. Except as listed in Schedule 4.L hereto,
Seller has complied in all material respects with all applicable
laws relating to the employment of labor, including provisions
thereof relating to wages, hours, equal opportunity and collective
bargaining, with respect to any employees of the Business. In the
last five (5) years, Seller has experienced no strikes. None of
the employees of the Sellers are covered by any collective
bargaining agreement, and no collective bargaining agreement is
currently being negotiated by the Seller.
M. Intellectual Property Rights. Schedule 1.A.3 hereto
sets forth a complete and accurate list of all of the Seller's
pending and issued copyright registrations, U.S. and foreign
patents and patent applications, trade names, trademarks, service
marks, trademark registrations, trademark applications, and all
written agreements under which the Seller licenses Intellectual
Property Rights (other than software licenses in the licensor's
standard form). Seller owns or has a valid right or license to use
all of the Intellectual Property Rights which are necessary for the
conduct of, or are used in, the Business as the Business is
presently being conducted and such rights and interests are either
(i) freely transferable to Buyer in the transaction contemplated
by this Agreement or (ii) will be licensed and made available for
use by Buyer without cost. Seller has no knowledge and has
received no notice to the effect that any service or products that
it provides or sells, or any process, method, part or material it
employs in the Business, infringes on any trademark, trade name,
copyright or patent or is in conflict with any asserted right of
another. There is no pending or, to the knowledge of Seller,
threatened, claim or litigation against Seller contesting its right
to use any of the Intellectual Property Rights being transferred
or licensed to Buyer, or asserting its misuse of any thereof, which
would deprive Buyer of its right to assert its rights thereunder
or which would prevent the sale of any service or product produced,
provided or sold by Buyer utilizing the Intellectual Property
Rights to be transferred to Buyer.
N. Intentionally Omitted.
O. Environmental Matters.
1. Definitions. As used in this Agreement:
(a) "Hazardous Materials" means (a) any and all
hazardous substances, pollutants, and contaminants (as
defined by the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended
("CERCLA")), hazardous wastes (as defined by the Resource
Conservation and Recovery Act ("RCRA")); hazardous materials
(as defined by the Hazardous Materials Transportation Act);
toxic substances (as defined by the Toxic Substances Control
Act ("TSCA")); toxic chemicals or extremely hazardous
substances (as defined by the Emergency Planning and
Community Right-To-Know Act); hazardous air pollutants (as
defined by the Clean Air Act); hazardous substances (as
defined by the Clean Water Act); (b) petroleum or petroleum
products; polychlorinated biphenyls ("PCBs"); asbestos-containing
materials; and (c) any other toxics, chemicals,
wastes, substances, or materials which are regulated under
any of the Environmental Laws (as defined herein);
(b) "Environmental Laws" means all applicable
federal, state, local and foreign laws, rules, regulations,
codes, ordinances, orders, decrees, permits, licenses and
judgments in effect as of the date of this Agreement and
relating to the environment and/or the use, generation,
storage, disposal, treatment, transportation, recycling, sale
or release of Hazardous Materials, including, without
limitation, CERCLA, RCRA, the Clean Water Act, the Clean Air
Act and TSCA;
(c) "Environmental Matters" means matters
relating to pollution, contamination or protection of the
environment, release or disposal of Hazardous Materials,
compliance with Environmental Laws (including, without
limitation, matters relating to any "Environmental Costs" (as
defined herein)) or to any releases or threatened releases
of Hazardous Materials into the air, surface water,
groundwater or soil, or resulting from the generation, use,
storage, treatment, recycling, transportation, disposal or
sale of Hazardous Materials); and
(d) "Environmental Costs" means any cleanup
costs, remediation, removal, or other response or site
rehabilitation costs (including, without limitation, costs
to bring the Business into compliance with all applicable
Environmental Laws), investigation costs (including, without
limitation, the reasonable fees and costs of consultants,
legal counsel and other experts in connection with any
environmental investigation, testing, audits, assessments or
studies), losses, liabilities, obligations, payments, damages
(including, without limitation, any actual, punitive or
consequential damages (a) to third parties (including
employees) for personal injury or damage to property, or (b)
to natural resources, fines, penalties, judgments, and
amounts paid in settlement arising out of or resulting from
any Environmental Matter.
2. Environmental Representations and Warranties of
Seller and Shareholders. Except as disclosed in Schedule 4.O
hereto:
(a) all material permits, approvals,
authorizations, licenses, certificates of authorization,
registrations or other consents required under all applicable
Environmental Laws for the operation of the Business and the
occupancy of the properties listed on Schedule 2.A.1.a
hereto, (the "Environmental Permits") have been obtained or
applied for, and there are no pending or, to the knowledge
of Seller and Shareholders, threatened actions to modify,
restrict, rescind or challenge any Environmental Permit;
(b) there are no material violations of any
Environmental Permit at any of the properties listed on
Schedule 2.A.1.a hereof;
(c) Seller has not received any notice in
writing (i) of the violation of any Environmental Laws by
Seller in connection with the operation of the Business at
any of the properties listed on Schedule 2.A.1.a hereof or
(ii) of any pending or threatened legal action against Seller
in connection with the operation of the Business at any of
the properties listed on Schedule 2.A.1.a hereof under the
authority of any Environmental Law or related to the release
of or exposure to any Hazardous Material;
(d) since February 8, 1991, no amounts of
Hazardous Materials were disposed of by Seller prior to the
Closing Date in, on, under, above or around the properties
listed on Schedule 2.A.1.a, except in accordance with all
applicable Environmental Laws;
(e) the processes and activities of Seller are
in substantial compliance with all applicable Environmental
Laws and regulations;
(f) there are no underground storage tanks on,
at or below any of the real property listed on
Schedule 2.A.1.a hereof; and
(g) since February 8, 1991, there have been no
releases (i.e. no past or present releasing, spilling,
leaking, pumping, pouring, emitting, emptying, discharging,
injecting, escaping, disposing or dumping) or threatened
releases of Hazardous Materials on, upon, into or from any
real property listed on Schedule 2.A.1.a hereto except in
accordance with all applicable Environmental Laws.
P. Absence of Certain Changes. Except as set forth on
Schedule 4.P, since November 30, 1995 the Seller has carried on the
Business only in the ordinary course, and there has not been
(a) any change in the assets, liabilities, sales, income or
business of the Seller or in its relationships with suppliers,
customers or lessors, other than changes which have not been,
either in any case or in the aggregate, materially adverse; (b) any
acquisition or disposition by the Seller of any asset or property
with a value in excess of $10,000 other than in the ordinary course
of business; (c) any damage, destruction or loss, whether or not
covered by insurance, materially and adversely affecting, either
in any case or in the aggregate, the property or business of the
Seller; (d) any declaration, setting aside or payment of any
dividend or any other distributions in respect of the Seller's
capital stock; (e) any increase in the compensation, pension or
other benefits payable or to become payable by the Seller to any
of its officers or employees, or any bonus payments or arrangements
made to or with any of them (other than pursuant to the terms of
any existing written agreement or plan of which the Buyer has been
supplied complete and correct copies of); (f) any forgiveness or
cancellation of any debt or claim by the Seller or any waiver of
any right of material value other than compromises of accounts
receivable in the ordinary course of business and other than debts
or claims forgiven or cancelled by the Seller in an aggregate
amount less than $10,000; (g) any entry by the Seller into any
material transaction, or any incurrence by the Seller of any
material obligations or liabilities, whether absolute, accrued,
contingent or otherwise (including, without limitation, liabilities
as guarantor or otherwise with respect to obligations of others),
other than, in each case, in the ordinary course of business; or
(h) any discharge or satisfaction by the Seller of any lien or
encumbrance or payment by the Seller of any obligation or liability
(fixed or contingent) other than (A) current liabilities included
in the Opening Balance Sheet, (B) current liabilities incurred
since the date of the Opening Balance Sheet in the ordinary course
of business and (C) any other obligations or liabilities of the
Seller which in the aggregate do not exceed $10,000.
Q. Real Property Leases. Schedule 2.A.1.a hereto lists
all leases pursuant to which the Seller holds any real property for
use in the Business. Complete and accurate copies of the Real
Property Leases have been delivered to the Buyer. Neither the
Seller nor the Shareholders has received any notice that either the
whole or any portion of the Leased Real Property is to be
condemned, requisitioned or otherwise taken by public authority.
Neither the Seller nor the Shareholders has any knowledge of any
public improvements which may result in special assessments against
or otherwise affect the Leased Real Property. Each of the Real
Property Leases is valid and subsisting and, upon receipt of any
consents required in connection with the transfer of such leases
as contemplated hereby, no event or condition exists which
constitutes, or after notice or lapse of time or both would
constitute, a default thereunder by the Seller, or to the knowledge
of Seller and Shareholders, by any other party thereto. The
leasehold interests of the Seller with respect to any Real Estate
Lease are subject to no Encumbrances.
R. Equipment. Schedule 4.R hereto sets forth a complete
and accurate list and the location of all injection molds used in
the Business. The Personal Property Leases listed on
Schedule 2.A.1.a hereto include all leases by the Seller of any
item of personal property used in the Business which require
payments in excess of $2,000 per annum.
S. Purchased Assets Complete. The Purchased Assets,
together with the Excluded Assets, constitute substantially all of
the assets used by the Seller in the conduct of the Business as
currently conducted by the Seller.
T. Accounts Receivable. All Closing Date Receivables
represent sales made in the ordinary course of business and are
valid obligations owing to the Seller.
5. Representations and Warranties of Buyer.
In order to induce Seller and Shareholders to enter into this
Agreement and to consummate the transactions contemplated
hereunder, Buyer represents and warrants to Seller and Shareholders
as follows:
A. Organization and Qualification. Buyer is a corporation
duly organized, validly existing and in good standing under the
laws of the State of Delaware with corporate power to own its
properties and to carry on its business as presently conducted.
B. Power and Authority. Buyer has the corporate power to
execute and deliver the Transaction Documents to which it is a
party and to incur and perform its obligations hereunder and
thereunder. The execution and delivery of the Transaction
Documents to which the Buyer is a party and the transactions
contemplated hereby and thereby have been duly authorized by all
necessary corporate action on the part of Buyer, and each of the
Transaction Documents to which the Buyer is a party is a legal,
valid and binding obligation of Buyer enforceable in accordance
with terms.
C. Approvals and Consents; Noncontravention. The
execution, delivery, and performance by Buyer of the Transaction
Documents to which it is a party and the consummation of the
transactions contemplated hereby and thereby, will not (i) violate
any statute, regulation or ordinance of any governmental authority
or require any filing with or authorization, consent or approval
of any government or governmental agency, (ii) conflict with,
result in the breach of, or constitute a violation or default under
any of the provisions of the Certificate of Incorporation or By
Laws of Buyer, (iii) conflict with or result in a breach of any
material agreement, deed, contract, mortgage, indenture, writ,
order, decree, contractual obligation or instrument to which Buyer
is a party or by which it or any of its assets are or may be bound,
or constitute a default (or an event which, with the lapse of time
or the giving of notice, or both, would constitute a default)
thereunder.
6. Covenants.
A. Publicity. Buyer, Seller and Shareholders shall
consult with each other before issuing any press release or other
public announcement concerning the transactions contemplated by
this Agreement and, except as may be required by applicable law or
any listing agreement with or regulation or rule of any listing
agreement with or regulation or rule of any stock exchange on which
securities of Seller, Buyer or Shareholders are listed or traded,
will not issue any such press release or announcement prior to such
consultation. If Buyer, Seller or Shareholders is so required to
issue such press release or announcement it shall use its best
efforts to inform the other party hereto prior to issuing such
press release.
B. Retention of and Access to Books and Records. For a
period of seven (7) years after the Closing Date, the parties shall
retain books or records relating to the Business, and any party,
wishing to dispose or destroy books or records, shall provide not
less than thirty (30) days prior written notice to the other party
of such proposed action. If the recipient of such notice desires
to obtain any of such documents, it may do so by notifying the
other party in writing at any time prior to the scheduled date for
such destruction or disposal. Such notice must specify the
documents which the requesting party wishes to obtain. The parties
shall then promptly arrange for the delivery of such documents.
All out-of-pocket costs associated with the delivery of the
requested documents shall be paid by the requesting party. Buyer
shall, subject to such reasonable limitations as may be necessary
to protect proprietary information, at the expense of Seller, and
on reasonable prior notice to Buyer, (a) afford Shareholders and
Seller, and their counsel, accountants, consultants and other
representatives reasonable access during normal business hours at
the business locations of the Purchased Assets to examine and copy
the books, tax returns, records and files of Seller which relate
to periods prior to the Closing Date, and (b) cooperate with
reasonable requests of Shareholders and Seller with respect to
gathering information contained therein which may be necessary to
respond to inquiries or requests made by any governmental authority
or courts which relate to any tax returns or other documents filed
by or on behalf of Shareholders and Seller prior to or relating to
the periods prior to the Closing Date. Seller shall, at Buyer's
sole expense, during normal business hours, afford Buyer and its
agents reasonable access to and the opportunity to review and make
copies of, all canceled checks of Seller relating to the Business
in connection with any reasonable request of Buyer.
C. Covenants of Seller and Shareholders.
1. 401(k) Plan. Effective as of the Closing Date,
Seller's obligation to make contributions to (other than
contributions attributable to the periods ending on or prior
to the Closing Date but payable thereafter), the Publicker
Industries Inc. 401(k) Plan (the "Publicker 401(k) Plan")
shall cease, and the employees of the Business shall cease
to accrue benefits under the Publicker 401(k) Plan. As soon
as practicable thereafter, Seller shall (i) pay to the
trustee of the Publicker 401(k) Plan all employee and
employer contributions attributable to periods ending on or
prior to the Closing Date, (ii) cause such amounts to be
allocated to participant accounts and (iii) cause the trustee
of the Publicker 401(k) Plan to transfer to the trust
established within 75 days after Closing pursuant to, or the
annuity contract purchased in connection with, Buyer's 401(k)
Plan in accordance with Section 414(1) of the Code an amount
in cash equal to the aggregate account balances (vested or
unvested) under the Publicker 401(k) Plan of those Hired
Employees employed by Buyer as of the date of transfer. Such
account balances shall be determined as of the Closing Date
but shall be reduced by any benefit or withdrawal payments
made to such Hired Employees to the date of transfer, be
adjusted by the contributions heretofore described and by any
gains or losses properly allocable to each such account from
the Closing Date to the date of transfer.
Notwithstanding the foregoing, if any Hired Employee
has an outstanding loan from the Publicker 401(k) Plan as of
the date of the transfer, the promissory note representing
the same and any and all ancillary and related documents
shall be assigned to Buyer's 401(k) Plan in lieu of cash in
the amount then due under such loan. Pending the transfer
described here, or the termination of the Hired Employee's
employment with Buyer if earlier, Buyer shall withhold from
the Hired Employee's pay and remit to the Publicker 401(k)
Plan any required repayment of an outstanding loan from such
Plan as and when due under the terms of such loan and Buyer
and Seller shall otherwise cooperate as reasonably necessary
to avoid a deemed distribution of such outstanding loan.
Buyer's 401(k) Plan shall credit each Hired Employee
whose account is transferred to such Plan with service for
purposes of participation and vesting equal to that credited
to such Hired Employee under the Publicker 401(k) Plan as of
the Closing Date. Such service shall be determined solely
from data reflected on a schedule to be prepared by the
Shareholder and furnished to the Buyer as soon as practicable
after the Closing Date.
Seller and Shareholders hereby represent and warrant
that the Publicker 401(k) Plan has determined by the Internal
Revenue Service (the "IRS") to constitute a qualified plan
under 401(a) of the Code, that nothing has occurred since
the date of the last such determination which could
reasonably be expected to result in a revocation of such
determination, and that to the best of the knowledge of
Seller and Shareholders, the Publicker 401(k) Plan has been
at all relevant times been maintained and operated in
material compliance with applicable law, including the Code.
Buyer hereby represents and warrants that Buyer's
401(k) Plan will be a newly established plan and either
(i) will be a prototype plan that is the subject of an
outstanding favorable opinion as to its form under 401(a)
of the Code or (ii) that Buyer will submit such Plan promptly
following its adoption to the IRS for a determination as to
its initial qualification under 401(a) of the Code and make
such amendments thereto as the Internal Revenue Service may
request to secure such determination.
1A. Welfare Plans. Effective as of the Closing Date,
the Hired Employees shall cease to be covered under any
employee welfare benefit plans maintained by Shareholder, and
except as those plans may otherwise provide, Shareholder
shall have no obligation to make premium or other payments
on behalf of the Hired Employees in respect of periods after
such date. Buyer shall assume the plans listed on Schedule
2.A.1.m. as of the Closing Date, and Shareholder and Seller
shall have no responsibility, liability or obligations as to
such plans in respect of periods after such date.
2. Protection of Confidential Information. Each of
Seller and Shareholders hereby agree, for a period of five
(5) years after the Closing Date to safeguard against
disclosure to third parties all Trade Secrets transferred to
Buyer hereunder, by using reasonable secrecy measures and not
less than the same degree of care as for its own similar
proprietary information.
3. Solicitation of Employees. For a period of five
(5) years after the Closing Date, each of Seller and
Shareholders shall not, without Buyer's prior written
consent, directly or indirectly solicit any person known to
Seller to be an employee of Buyer nor shall Seller or
Shareholders encourage any such employee to terminate his or
her employment with Buyer.
4. Intellectual Property. To the extent Seller
fails to transfer any Intellectual Property Rights or to make
available any which are currently used in the operation of
the Business as it is presently conducted, Seller shall take
all commercially reasonable actions required to effect or
assist such transfer so as to confer upon Buyer those
benefits held by Seller which attend a use of such
Intellectual Property Rights in connection with the Business.
5. Name. As of the Closing, Seller shall amend its
articles of incorporation to change its name to a name not
similar to "Bright Star Industries, Incorporated."
6. Non-Competition. Each of the Seller and the
Shareholders agrees that for a period commencing on the
Closing Date and continuing through the fifth anniversary of
the Closing Date, the Seller and the Shareholders will not
engage in the Designated Industry anywhere in the world,
alone or as a shareholder, partner or consultant of any other
business organization; provided, that the foregoing
restriction shall not prevent the Seller or Shareholders from
(i) owning ten percent (10%) or less of the equity securities
of any publicly traded company engaged in the Designated
Industry or (ii) acquiring and operating any entity which
derives less than ten percent (10%) of its gross revenues
from the Designated Industry. The term "Designated Industry"
means the business of the manufacture, distribution or sale
of flashlights or batteries.
D. Covenants of Buyer.
1. Employment. As of the Closing, the Buyer will
hire all employees of the Business at substantially the same
level of compensation and benefits as provided by the Seller
immediately prior to the Closing (except (i) with respect to
Maurice L. Kirwan who will enter into a separate written
employment agreement with the Buyer and (ii) the Buyer's
401(k) Plan will be established after the Closing in
accordance with the terms of this Agreement), other than the
employees disclosed on Schedule 6.D.1 hereto (the "Discharged
Employees"), to continue working in their present capacities
with the Business (all such employees other than the
Discharged Employees being referred to herein as the "Hired
Employees"); provided, however, that nothing contained in
this Section 6.D.1 shall (x) require that Buyer continue to
employ any employee after the Closing Date or (y) restrict
the Buyer's ability to change the level of compensation and
benefits provided to any Hired Employee after the Closing
Date. Any obligations under the Worker Adjustment and
Retraining Notification Act ("WARN") attributable to the
failure of Buyer to employ or continue to employ all such
persons are hereby assumed by Buyer. The Seller shall be
responsible for the severance or displacement pay, if any,
due for any Hired Employee if any severance or displacement
pay is due to such Hired Employee as a consequence of his
termination by Seller even though such employee is hired by
the Buyer on the Closing Date and the Buyer shall be
responsible for the severance or displacement pay, if any,
due to any Hired Employee subsequently terminated by the
Buyer, with any such obligations to be determined by the
terms of the severance or displacement pay arrangements
maintained by the Seller and the Buyer, respectively. The
Seller and the Shareholders represent to the Buyer that the
amount of any severance pay owing to each Discharged Employee
is as set forth on Schedule 6.D.1. Notwithstanding that
severance payments are not Assumed Liabilities hereunder, the
Buyer agrees to pay (a) fifty percent (50%) of the severance
pay owed by the Seller to Kim Straus up to a maximum amount
of $42,500 and (b) all of the severance pay owed by the
Seller to the Discharged Employees other than Kim Straus up
to a maximum amount of $18,000, in each case as and when such
payments are due. For purposes of the definition of Net Book
Value, the term Assumed Liabilities shall be deemed not to
include the Buyer's obligations under this Section 6.D.1.
7. WARRANTY CLAIMS.
The Buyer hereby agrees that it will service any Warranty
Claims after the Closing Date, provided, that, with respect to each
such Warranty Claim, the Seller shall pay to the Buyer an amount
equal to 100% of the out-of-pocket costs incurred by the Buyer in
connection with the servicing of such Warranty Claim. Promptly
following the end of each calendar month, the Buyer shall furnish
to the Seller a statement of all servicing costs incurred by the
Buyer with respect to any Warranty Claims during the previous
calendar month and the Seller shall pay 100% of such amount within
15 days after receipt of such statement. If at any time, the
Seller shall fail to timely pay to the Buyer any amounts required
to be paid to the Buyer pursuant to this Section 7, and such
failure remains uncured within ten (10) days after written notice
from the Buyer to the Seller, the Buyer shall have no further
obligation to service any Warranty Claims.
8. Indemnification.
The indemnification provided by this Section 8 shall be the
exclusive remedy for any breach of, or failure to perform, any
representations, warranties, covenants or agreements set forth in
this Agreement or any Schedule or Exhibit hereto.
A. Seller's and Shareholders' Indemnity. Seller and
Shareholders, jointly and severally, shall indemnify, defend and
hold Buyer harmless from, against and in respect of any and all
claims, expenses, liabilities, damages, losses, costs, government
proceedings, causes of action, demands, judgments (including,
without limitation, reasonable attorneys fees) (collectively, the
"Claims") to the extent suffered or incurred by Buyer by reason of
any of the following:
1. Seller's failure to pay, discharge or perform any
of its liabilities or obligations other than the Assumed
Liabilities, but including, without limitation, the Excluded
Liabilities;
2. any violations of any Environmental Law resulting
from the operation of the Business or occupancy of the
property listed in Schedule 1.A.2 hereto after February 8,
1991 and through the Closing Date;
3. any breach of, or failure by Seller or
Shareholders to perform, any of its representations,
warranties, covenants or agreements set forth in this
Agreement or any Schedule or Exhibit hereto; and
4. the presence on the property listed on Schedule
1.A.2 of any Hazardous Materials including contamination of
ground water, surface water, air or soils on, over, under or
around said property or on, over, under or around adjacent
property prior to the Closing Date.
B. Buyer's Indemnity. Buyer shall indemnify defend and
hold Seller and Shareholders harmless from, against and in respect
of any and all claims, expenses, liabilities, damages, losses,
costs, government proceedings, causes of action, demands, and
judgments (including, without limitation, reasonable attorney's
fees) (collectively, the "Claims") to the extent suffered or
incurred by Seller or Shareholders by reason of any of the
following:
1. any claim or cause of action by any party arising
from Buyer's failure to pay, discharge or perform any of the
Assumed Liabilities;
2. any claim or cause of action by any party arising
from Buyer's operation of the Business and use of the
Purchased Assets after the Closing, other than a claim or
cause of action which is subject to indemnification pursuant
to Section 8.A hereof;
3. any violations of any Environmental Law resulting
from the operation of the Business or occupancy of the
property listed in Schedule 1.A.2 hereto subsequent to the
Closing Date other than a violation which is subject to
indemnification pursuant to Section 8.A hereof; and
4. any breach of, or failure by Buyer to perform,
any of its representations, warranties, covenants or
agreements set forth in this Agreement or any Schedule or
Exhibit hereto.
C. Indemnity Procedure. Subject to the time limitations
and amounts set forth in Section 8.D below, the Buyer, Seller and
Shareholders shall each follow the following procedures, as the
case may be:
1. Notice. Any party seeking indemnification
hereunder (the "Indemnified Party") shall promptly notify the
other party hereto (the "Indemnifying Party") of any action,
suit, proceeding, demand or breach (a "Claim") with respect
to which the Indemnified Party claims indemnification
hereunder, provided that failure of the Indemnified Party to
give such notice shall not relieve the Indemnifying Party of
its obligations under this Section 8 except to the extent,
if at all, that such Indemnifying Party shall have been
prejudiced thereby.
2. Third Party Claims. If such Claim relates to any
action, suit, proceeding or demand instituted against the
Indemnified Party by a third party (a "Third Party Claim"),
the Indemnifying Party shall be entitled to participate in
the defense of such Third Party Claim after receipt of notice
of such claim from the Indemnified Party. Within thirty (30)
days after receipt of notice of a particular matter from the
Indemnified Party, the Indemnifying Party may assume the
defense of such Third Party Claim, in which case the
Indemnifying Party shall have the authority to negotiate,
compromise and settle such Third Party Claim, if and only if
the following conditions are satisfied:
(i) the Indemnifying Party shall have
confirmed in writing that it is obligated hereunder to
indemnify the Indemnified Party with respect to such
Third Party Claim; and
(ii) the Indemnified Party shall not have
given the Indemnifying Party written notice that it has
determined, in the exercise of its reasonable
discretion, that a conflict of interest make separate
representation by the Indemnified Party's own counsel
advisable.
The Indemnified Party shall retain the right to employ its
own counsel and to participate in the defense of any Third
Party Claim, the defense of which has been assumed by the
Indemnifying Party pursuant hereto, but the Indemnified Party
shall bear and shall be solely responsible for its own costs
and expenses in connection with such participation. Each of
the parties hereto shall cooperate with each other in the
defense of any Third Party Claim by the other party hereto.
Each of the parties shall make available to the other party
reasonable access to books and records relating to the Third
Party Claim and shall make available such party's personnel
to the extent reasonably necessary in connection with the
defense of such Third Party Claim.
3. Method and Manner of Paying Claims. In the event
of any claims under this Section 8, the claimant shall advise
the party or parties who are required to provide
indemnification therefor in writing of the amount and
circumstances surrounding such claim. With respect to
liquidated claims, if within thirty days the other party has
not contested such claim in writing, the other party will pay
the full amount thereof within ten days after the expiration
of such period; provided that payment of any amount required
to be paid by the Seller or the Shareholders to the Buyer
under this Section 8 shall be made from the Escrowed Funds
in accordance with the provisions of the Escrow Agreement.
Any amount owed by an Indemnifying Party hereunder with
respect to any Claim may be set-off by the Indemnified Party
against any amounts owed by the Indemnified Party to any
Indemnifying Party.
D. Limitations of Indemnities.
1. Notwithstanding the provisions of Sections 8.A,
8.B and 8.C hereof, no payment shall be made by an
indemnifying party to an indemnified party based upon any
claim of an indemnified party under this Section 8 until the
amount of all such claims (after deducting insurance proceeds
and third party recoveries paid to or for the benefit of the
indemnified party) shall total, in the aggregate of fifty
thousand dollars ($50,000) for any liabilities (excluding tax
liabilities which shall be fully reimbursed) (the "Minimum
Damages"), in which event only the amount of such claims of
the indemnified party in excess of the Minimum Damages (after
deducting any insurance proceeds and third party recoveries
paid to or for the benefit of the indemnified party) shall
be subject to indemnification in accordance with the terms
of Sections 8.A, 8.B and 8.C hereof. Notwithstanding the
provisions of Sections 8.A, 8.B and 8.C hereof, the maximum
liability of the Shareholders and the Seller (in the
aggregate) or of the Buyer under this Section 8 shall be
limited to an amount equal to the cash portion of the
Purchase Price.
2. The parties' respective obligations to indemnify
each other under Sections 8.A, 8.B and 8.C hereof shall
expire on the following anniversaries of the Closing Date:
(a) the seventh (7th) anniversary, with respect
to all tax claims and all claims involving
Environmental Matters; and
(b) the second anniversary, with respect to all
other matters.
E. Remedies. The indemnification provisions set forth in
this Section 8 shall be Seller's and Buyer's sole and exclusive
remedy against each other and Shareholders for any breach or
misrepresentation of any covenant or representation made herein,
provided that, Seller and Buyer shall retain all remedies at law
or in equity in the event of any willful fraud committed by the
other party hereto in connection with the terms of this Agreement.
9. Closing Conditions.
A. Conditions to Seller's Obligations. The obligations
of Seller to consummate the transactions provided for herein are
subject, in the discretion of Seller, to the satisfaction, on or
prior to the Closing Date, of each of the following conditions;
provided that Seller shall have the right to waive any such
condition, and the parties hereto agree that the Closing of this
Agreement constitutes a waiver by Seller of any such condition and
of any claim or right relating to the subject matter of any such
condition:
1. Representations, Warranties and Covenants. All
representations and warranties of Buyer contained in this
Agreement shall be true and correct in all material respects
at and as of the Closing Date, except as and to the extent
that the facts and conditions upon which such representations
and warranties are based are expressly required or permitted
to be changed by the terms hereof, and Buyer shall have
performed all agreements and covenants required hereby to be
performed by it prior to or at the Closing Date.
2. Consents. All consents, approvals and waivers
from governmental authorities and other parties necessary to
permit Buyer to purchase the Purchased Assets from Seller as
may be contemplated hereby shall have been obtained.
3. No Governmental Proceedings or Litigation. No
action, suit or proceeding before any court or governmental
body shall have been instituted (and be pending) by any
governmental authority to restrain or prohibit this Agreement
or the consummation of the transactions contemplated hereby.
No preliminary or permanent injunction or other order issued
by any federal or state court of competent jurisdiction
preventing consummation of the transactions contemplated
hereunder shall be in effect.
4. Certificates. Buyer will furnish Seller with
such certificates of its officers and others to evidence
compliance with the conditions set forth in this Article 9
as may be reasonably requested by Seller.
5. Corporate Documents. Seller shall have received
resolutions adopted by the board of directors of Buyer
approving this Agreement and the transactions contemplated
hereby, certified by Buyer's corporate secretary.
6. Legal Opinion. Bingham, Dana & Gould, counsel to
the Buyer, shall have delivered to the Seller a written
opinion, dated the Closing Date and addressed to the Seller,
substantially in the form of Exhibit D hereto.
7. Agreements. The Buyer shall have executed and
delivered the Transaction Documents to which it is a party,
and such agreements shall be in full force and effect.
B. Conditions to Buyer's Obligations. The obligations of
Buyer to consummate the transactions provided for hereby are
subject, in the discretion of Buyer, to the satisfaction, on or
prior to the Closing Date, of each of the following conditions;
provided that Buyer shall have the right to waive any such
condition, and the parties hereto agree that the Closing of this
Agreement constitutes a waiver by Buyer of any such condition and
of any claim or right relating to the subject matter of any such
condition:
1. Representations, Warranties and Covenants. All
representations and warranties of Seller and Shareholders
contained in this Agreement shall be true and correct in all
material respects at and as of the Closing Date, except as
and to the extent that the facts and conditions upon which
such representations and warranties are based are expressly
required or permitted to be changed by the terms hereof, and
Seller and Shareholders shall have performed all agreements
and covenants required hereby to be performed by them prior
to or at the Closing Date.
2. Consents. All consents, approvals and waivers
from governmental authorities and other parties necessary to
permit Seller to transfer the Purchased Assets to Buyer as
contemplated hereby, and in the aggregate sufficient and
adequate to carry on the Business as presently being
conducted, shall have been obtained.
3. No Governmental Proceedings or Litigation. No
action, suit or proceeding before any court or governmental
body shall have been instituted (and be pending) by any
governmental authority to restrain or prohibit this Agreement
or the consummation of the transactions contemplated hereby.
No preliminary or permanent injunction or other order issued
by any federal or state court of competent jurisdiction
preventing consummation of the transactions contemplated
hereunder shall be in effect.
4. Certificates. Seller will furnish Buyer with
such certificates of its officers and others to evidence
compliance with the conditions set forth in this Article 9
as may be reasonably requested by Buyer.
5. Corporate Documents. Buyer shall have received
from Seller and Shareholders, resolutions adopted by the
board of directors of Seller approving this Agreement and the
transactions contemplated hereby, certified by Seller's and
each of the Shareholder's corporate secretary.
6. Legal Opinion. Kaye, Scholer, Fierman, Hays &
Handler, LLP, counsel to the Seller and the Shareholders,
shall have delivered to the Buyer a written opinion, dated
the Closing Date and addressed to the Buyer, substantially
in the form of Exhibit E hereto.
7. Agreements. The Seller and the Shareholders
shall have executed and delivered the Transaction Documents
to which they are a party, and such agreements shall be in
full force and effect.
10. Closing Documents.
A. Provided by Buyer.
1. Funds. Wire transfer of the full amount of the
Purchase Price as set forth in Section 3.B.
2. Assumptions. Executed Bills of Sale and
Assignments of Contracts in the form attached hereto as
Exhibit C and executed assignments of lease agreements as
specified in Schedule 2.A.1.a hereto.
3. Secretary's Certificates. All resolutions of the
Board of Directors of Buyer authorizing the transactions
contemplated by this Agreement, certified by the Secretary
of Buyer.
B. Provided By Seller.
1. Assignments and Bills of Sale. Executed Bills of
Sale and Assignments of Contracts in the form attached hereto
as Exhibit C and executed assignments of lease agreements as
specified in Schedule 2.A.1.a hereto.
2. Secretary's Certificates. All resolutions of the
Board of Directors of Seller and Shareholders and the Parent
as the sole shareholder of Seller authorizing the
transactions contemplated by this Agreement, certified by the
Secretary of Seller and each Shareholder.
11. Miscellaneous.
A. Successors and Assigns. Except as otherwise provided
in this Agreement, no party hereto shall assign this Agreement or
any rights or obligations hereunder (including by operation of law)
without the prior written consent of the other parties hereto and
any such attempted assignment without such prior written consent
shall be void and of no force and effect. This Agreement shall
inure to the benefit of and shall be binding upon the successors
and permitted assigns of the parties hereto.
B. Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New
York.
C. Expenses. Seller, Shareholders and Buyer will pay
their respective costs and expenses, including the expenses of
their accounting and legal representatives, in connection with the
origin, negotiation, execution and performance of this Agreement.
D. Force Majeure. No party hereto shall be liable for any
failure of or delay in the performance of this Agreement for the
period that such failure or delay is due to acts of God, public
enemy, civil war, strikes or labor disputes or any other cause
beyond the parties' reasonable control. Each party agrees to
notify the other party promptly upon the occurrence of any such
cause and to carry out this Agreement as promptly as practicable
after such cause is terminated.
E. Severability. If any part or provision of this
Agreement shall be determined to be invalid or unenforceable by a
court of competent jurisdiction or any other legally constituted
body having jurisdiction to make such determination, such part or
provision shall be valid and enforceable to the maximum extent
permitted by law and the remaining provisions of this Agreement
shall be fully effective.
F. Brokers' and Finders' Fees. Each of the parties
represents and warrants that, with the exception of Mr. Ronald
Shapss and Pride Capital Group Inc., it has dealt with no broker
or finder in connection with any of the transactions contemplated
by this Agreement and, insofar as it knows, no broker or other
person other than Mr. Ronald Shapss and Pride Capital Group Inc.
is entitled to any commission or finder's fee in connection with
any of these transactions. Seller acknowledges that it is solely
responsible for the payment of any commission or finder's fee due
Mr. Ronald Shapss in connection with these transactions and Buyer
acknowledges that it is solely responsible for the payment of any
commission or finder's fee due Pride Capital Group Inc. in
connection with these transactions.
G. Notices. All notices, requests, demands and other
communications under this Agreement shall be in writing and shall
be deemed to have been duly given (i) on the date of service if
served personally on the party to whom notice is to be given, (ii)
on the day of transmission if sent by facsimile transmission to the
facsimile number given below, and telephonic confirmation of
receipt is obtained promptly after completion of transmission,
(iii) on the day after delivery to Federal Express or similar
overnight courier or the Express Mail service maintained by the
United States Postal Service, or (iv) on the fifth (5th) day after
mailing, if mailed to the party to whom notice is to be given, by
first class mail, registered or certified, postage prepaid and
properly addressed, to the party as follows:
If to Seller or
Shareholders: Bright Star Industries, Incorporated
c/o Publicker Industries Inc.
1445 East Putnam Avenue
Old Greenwich, Connecticut 06870
Attention: Mr. James J. Weis
Telephone: (203) 637-4500
Facsimile: (203) 637-4807
Copy to: Kaye, Scholer, Fierman, Hays & Handler, LLP
425 Park Avenue
New York, NY 10022
Attention: Joel I. Greenberg,
Esq.
Telephone: (212) 836-8000
Facsimile: (212) 836-7246
If to Buyer: c/o BancBoston Ventures Inc.
100 Federal Street
Boston, Massachusetts 02110
Attention: John Cullinane,
Vice President
Telephone: (617) 434-5591
Facsimile: (617) 434-1153
Copy to: Bingham, Dana & Gould
150 Federal Street
Boston, Massachusetts 02110
Attention: Robert M. Wolf,
Esq.
Telephone: (617) 951-8000
Facsimile: (617) 951-8736
Any party may change its address for the purpose of this Section
11.G by giving the other party notice of its new address in the
manner set forth above.
H. Amendments; Waivers. This Agreement may be amended,
modified, superseded or cancelled, and any of the terms, covenants,
representations, warranties or conditions hereof may be waived,
only by written instrument executed by both parties hereto, or in
the case of a waiver, by the party waiving compliance. Any waiver
by any party of any condition, or of the breach of any provision,
term, covenant, representation or warranty contained in this
Agreement, in any one or more instances, shall not be deemed to be
nor construed as further or continuing waiver of any such
condition, or of the breach of any other provision, term, covenant,
representation or warranty of this Agreement.
I. Entire Agreement. This Agreement, the Escrow Agreement
and the exhibits referred to herein contain the entire agreement
of the parties hereto with respect to the sale and purchase of the
Purchased Assets and the other transactions contemplated herein,
and any reference herein to this Agreement shall be deemed to
include the schedules and exhibits attached hereto. All oral or
written agreements, statements, representations, warranties, and
understandings made or entered into by the parties prior to or
contemporaneously with the execution of this Agreement are hereby
rendered null and void and are merged herewith.
J. Further Matters. Each party agrees to execute such
further instruments of assignment and transfer and to perform such
additional acts and as are necessary to consummate the transactions
contemplated by this Agreement.
K. Parties in Interest. Nothing in this Agreement is
intended to confer, or confers, any rights or remedies under or by
reason of this Agreement on any persons other than the parties to
it and their respective successors and assigns. Nothing in this
Agreement is intended to, or does, relieve or discharge the
obligations or liability of any third persons to any party to this
Agreement. No provision of this Agreement shall give any third
persons any right of subrogation or action over or against any
party to this Agreement.
L. Survival. The representations, warranties and
covenants of the parties set forth herein shall survive the Closing
date of this Agreement for the periods set forth in Section 8.D
hereof.
M. Section and Paragraph Headings. The section and
paragraph headings in this Agreement are for reference purposes
only and shall not affect the meaning or interpretation of this
Agreement.
N. Counterparts. This Agreement may be executed in
several counterparts each of which shall be deemed an original but
all of which together shall constitute one and the same instrument.
O. Liquidated Damages. The Seller's sole and exclusive
remedy for the Buyer's failure to consummate the transactions to
be accomplished at the Closing shall be recourse to the sum of
$100,000 as liquidated damages under the Deposit Escrow Agreement,
subject to the terms and conditions in the letter agreement dated
as of December 19, 1995 among the shareholders of the Buyer, the
Seller and Publicker.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above
written.
SHAREHOLDERS:
Publicker Industries Inc.
By:
Title:
Hanten Acquisition Co.
By:
Title:
SELLER:
Bright Star Industries,
Incorporated
By:
Title:
BUYER:
Bright Star Acquisition Corp.
By:
Title:
