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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) November 22, 1996
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NSA INTERNATIONAL, INC.
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(Exact name of registrant as specified in its charter)
Tennessee 0--19487 62-1387102
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
4260 East Raines Road, Memphis, Tennessee 38118
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (901) 366-9288
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Not Applicable
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(Former name, former address and former fiscal year, if changed
since last report)
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INFORMATION TO BE INCLUDED IN THE REPORT
ITEM 1. CHANGES IN CONTROL OF REGISTRANT.
None.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On November 22, 1996, the Registrant completed negotiations for the
sale of certain of the assets of three of its wholly owned operating
subsidiaries, National Safety Associates of America (U.K.) Limited, a British
corporation ("NSA UK"), NSA B.V., a Dutch corporation ("NSA Netherlands"), and
NSA, S.A., a Belgium corporation ("NSA Belgium"), to Nova Vita Ltd, a limited
liability company registered in England (the "Buyer").
The agreed upon aggregate purchase price for the assets acquired was
$250,000 (U.S.), based on the approximate book value of the assets. The
purchase price for these transactions consists of the delivery and payment in
accordance with the terms of the Buyer's non-interest bearing promissory note
in the principal amount of $250,000 which is due and payable over a seven year
period. The note is secured by certain of the assets of the Buyer.
Additionally, as a condition of the sale, the Registrant entered into
a distribution contract with the Buyer which provides that the Buyer will
continue to purchase products from the Registrant for resale in the United
Kingdom, Republic of Ireland, Belgium and The Netherlands.
ITEM 3. BANKRUPTCY OR RECEIVERSHIP.
None.
ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT.
None.
ITEM 5. OTHER EVENTS.
None.
ITEM 6. RESIGNATIONS OF REGISTRANT'S DIRECTORS.
None.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements.
None.
(b) Exhibits.
10.28 Asset Purchase Agreement between National Safety
Associates of America (U.K.) Limited and Nova Vita,
Ltd
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ITEM 8. CHANGE IN FISCAL YEAR.
None.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
NSA INTERNATIONAL, INC.
Date: November 25, 1996 By: /s/ Stan C. Turk
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Stan C. Turk
Chief Financial Officer
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Exhibit 10.28
ASSET PURCHASE AGREEMENT
BY AND BETWEEN
NATIONAL SAFETY ASSOCIATES OF
AMERICA (U.K.) LIMITED
AND
NOVA VITA LIMITED
Effective as of October 1, 1996
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TABLE OF CONTENTS
(This Table of Contents is not a part of the Agreement and is only for
convenience of reference.)
<TABLE>
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Page
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1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 1 -
2. Basic Transaction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 2 -
(a) Purchase and Sale of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 2 -
(b) Assumption of Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 2 -
(c) Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 3 -
(d) The Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 3 -
(e) Deliveries at the Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 3 -
(f) Allocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 3 -
(g) Proration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 3 -
(h) Taxes and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 3 -
3. Representations and Warranties of the Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 3 -
(a) Organization of the Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 3 -
(b) Authorization of Transaction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 3 -
(c) Noncontravention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 4 -
(d) Title to Property and Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 4 -
(e) Other Transfer Instruments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 4 -
4. Representations and Warranties of the Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 4 -
(a) Organization of the Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 4 -
(b) Authorization of Transaction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 4 -
(c) Noncontravention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 4 -
(d) Physical Condition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 4 -
5. Deliveries at Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 5 -
(a) Documents to be Delivered by the Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 5 -
(b) Documents to be Delivered by Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 5 -
6. Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 5 -
(a) Affected Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 5 -
(b) Responsibilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 6 -
(c) Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 6 -
7. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 6 -
(a) Survival of Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 6 -
(b) No Third-Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 6 -
(c) Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 6 -
(d) Succession and Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 7 -
(e) Relationship between the Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 7 -
(f) Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 7 -
(g) Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 7 -
(h) Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 7 -
(i) Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 8 -
</TABLE>
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<TABLE>
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(j) Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 8 -
(k) Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 8 -
(l) Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 8 -
(m) Incorporation of Exhibits and Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 8 -
(n) Condition of the Acquired Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 8 -
(o) Attorney's Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 8 -
(p) Premises. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 8 -
(q) Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 9 -
SCHEDULE 1(a) Acquired Tangible Personal Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . Schedule 1(a)-1
SCHEDULE 1(b) Acquired Utility Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Schedule 1(b)-1
SCHEDULE 1(c) Acquired Prepaid Items and Security Deposits . . . . . . . . . . . . . . . . . . . . . . . Schedule 1(c)-1
SCHEDULE 1(d) Distributor Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Schedule 1(d)-1
SCHEDULE 1(e) Excluded Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Schedule 1(e)-1
SCHEDULE 6(a) Affected Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Schedule 6(a)-1
EXHIBIT 2(c) Form of Buyer Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2(c)-1
EXHIBIT 2(f) Allocation of Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2(f)-1
EXHIBIT 5(a)(iii) Security Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5(a)(iii)-1
EXHIBIT 5(a)(vi) Assignment and Assumption Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5(a)(vi)-1
EXHIBIT 5(b)(i) Bill of Sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5(b)(i)-1
EXHIBIT 7(p) Licence of Premises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7(p)-1
</TABLE>
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ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT is entered into as of the 1st day of
October, 1996, by and between NATIONAL SAFETY ASSOCIATES OF AMERICA (U.K.)
LIMITED, of 39 Queen Street, Maidenhead, Berkshire (the "Seller"), and NOVA
VITA LTD of 39 Queen Street, Maidenhead, Berkshire (the "Buyer"), both being
limited liability companies registered in England. The Buyer and the Seller
are referred to collectively herein as the "Parties."
W I T N E S S E T H:
WHEREAS, the Seller owns and operates a multi-level distributorship
organization based in Maidenhead, Berkshire, England, and desires to sell
certain of the assets and assign certain of the liabilities of such business;
and
WHEREAS, the Buyer is willing to purchase certain of the assets and
assume certain of the liabilities of such business;
NOW, THEREFORE, in consideration of the mutual covenants,
representations, warranties and promises herein contained, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Definitions.
"Acquired Assets" means all of the right, title, and interest, if any,
that the Seller possesses and has the right to transfer in and to all of its
assets, excluding the Excluded Assets, but including (a) the equipment,
furniture, fixtures, vehicles, leasehold improvements, and other depreciable or
amortizable assets of Seller, listed on SCHEDULE 1(A); (b) the utility deposits
listed on SCHEDULE 1(B); (c) the prepaid items and security deposits listed on
SCHEDULE 1(C); (d) the Distributor contracts listed on SCHEDULE 1(D); (e)
goodwill, (f) customer lists, and (g) the right to hold itself out as successor
in interest to the Seller.
"Affiliate" means a Person that directly, or indirectly, through one
or more intermediaries, controls, or is controlled by, or is under common
control with a specified Person.
"Assumed Liabilities" means (a) all obligations and liabilities of the
Seller under any agreements, contracts, leases, licenses, and other
arrangements referred to in the definition of Acquired Assets either (i) to
furnish goods, services or other benefits to another party after the Closing
Date or (ii) to pay for goods, services or other benefits that another party
will furnish to it after the Closing Date, including without limitation, all
obligations and liabilities of the Seller under those Distributor contracts
listed on SCHEDULE 1(D) hereto and (b) all obligations and liabilities
expressly assumed by Buyer pursuant to this Agreement.
"Buyer" has the meaning set forth in the preface above.
"Buyer Note" has the meaning set forth in SECTION 2(C) below.
"Cash" means cash and cash equivalents calculated in accordance with
GAAP applied on a consistent basis.
"Closing" has the meaning set forth in SECTION 2(D) below.
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"Closing Date" has the meaning set forth in SECTION 2(D) below.
"Excluded Assets" means (a) the assets of the Seller listed on SCHEDULE
1(E), (b) the corporate charter, qualifications to conduct business,
arrangements with registered agents relating to necessary qualifications,
taxpayer and other identification numbers, seals, minute books, stock transfer
books, blank stock certificates, and other documents relating to the
organization, maintenance, and existence of the Seller as a corporation, (c) any
Cash on hand or Cash in any bank(s) as of the Closing Date, (d) all accounts
receivable of the Seller, (e) any and all stock, or other applicable ownership
or economic interest, in another Person which is held by the Seller of record or
beneficially, and (f) any of the rights of the Seller under this Agreement or
any related documents (or under any side agreement between the Seller on the one
hand and the Buyer on the other hand entered into on or after the date of this
Agreement).
"GAAP" means generally accepted accounting principles as in effect
from time to time in the United Kingdom (UK GAAP).
"Income Tax" means any taxation of income and includes Corporation Tax
and any interest, penalty, or addition thereto, whether disputed or not.
"Income Tax Return" means any return, declaration, report, claim for
refund, or information return or statement relating to Income Taxes, including
any schedule or attachment thereto.
"Knowledge" means the actual knowledge of the officers of Seller,
without independent investigation.
"Liability" means any liability (whether known or unknown, asserted or
unasserted, absolute or contingent, accrued or unaccrued, liquidated or
unliquidated, and whether due or to become due).
"Ordinary Course of Business" means the ordinary course of business
consistent with past custom and practice.
"Party" has the meaning set forth in the preface above.
"Person" means an individual, a partnership, a corporation, an
association, a joint stock company, a limited liability company, a trust, a
joint venture, an unincorporated organization, or a governmental entity (or any
department, agency, or political subdivision thereof).
"Purchase Price" has the meaning set forth in SECTION 2(C) below.
"Seller" has the meaning set forth in the preface above.
"Shareholder" shall mean NSA International, Inc., a Tennessee
corporation.
2. Basic Transaction.
(a) Purchase and Sale of Assets. On and subject to the terms and
conditions of this Agreement, the Buyer agrees to purchase from the Seller, and
the Seller agrees to sell, transfer, convey, and deliver to the Buyer, at the
Closing, all of the Acquired Assets for the consideration specified in this
SECTION 2.
(b) Assumption of Liabilities. On and subject to the terms and
conditions of this Agreement, the Buyer agrees to assume and become responsible
for all of the Assumed Liabilities on the Closing Date. The
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Buyer will not assume or have any responsibility, however, with respect to any
other obligation or liability of the Seller not included within the definition
of Assumed Liabilities.
(c) Purchase Price. The purchase price for the Acquired Assets shall
be Two Hundred Fifty Thousand United States Dollars ($250,000 U.S.), plus the
assumption of the Assumed Liabilities (the "Purchase Price") which shall be
comprised of the following payments and obligations (i) the Buyer's assumption
of all of the Assumed Liabilities and (ii) the Buyer's delivery to the Seller
and payment in accordance with the terms of the promissory note (the "Buyer
Note") in substantially the form attached hereto as EXHIBIT 2(C).
(d) The Closing. The closing of the transactions contemplated by
this Agreement (the "Closing") shall take place at the offices of Elliott &
Company in Manchester, England, at such time and date as the Buyer and the
Seller shall agree (the "Closing Date"); provided, however, that the Closing
Date shall not be later than November 1, 1996.
(e) Deliveries at the Closing. At the Closing, (i) the Buyer will
deliver to the Seller the various certificates, instruments, and documents
referred to in SECTION 5(A) below; and (ii) the Seller will deliver to the
Buyer the various certificates, instruments, and documents referred to in
SECTION 5(B) below.
(f) Allocation. The Parties agree to allocate the Purchase Price
(and all other capitalizable costs) among the Acquired Assets for all purposes
(including financial accounting and tax purposes) as set out in EXHIBIT 2(F).
(g) Proration. The following proration relating to the Acquired
Assets will be made as of the Closing, with the Seller liable to the extent
such items relate to any time period up to the Closing Date and the Buyer
liable to the extent such items relate to any time period occurring on and
after the Closing Date. To the extent possible, the net amount of all such
prorations will be settled and paid at the Closing.
(i) VAT and other taxes, if any, on or with respect to the
Acquired Assets.
(ii) rents, additional rents, taxes and other items payable
by the Seller under any lease, license, permit, contract or other
agreement or arrangement to be assigned to or assumed by Buyer.
(iii) the amount of rents, taxes, and charges for sewer,
water, fuel, telephone, electricity, and other utilities; provided
that if practicable, meter readings shall be taken on the Closing Date
and the respective obligations of the parties determined in accordance
with such readings.
(h) Taxes and Expenses. The Seller shall be responsible for any
business, occupation, withholding or similar tax, or any taxes of any kind
related to the Seller's business for any period prior to the Closing Date.
3. Representations and Warranties of the Seller. The Seller
represents and warrants to the Buyer that the statements contained in this
SECTION 3 are correct and complete as of the date of this Agreement and will be
correct and complete as of the Closing Date (as though made then and as though
the Closing Date were substituted for the date of this Agreement throughout
this SECTION 3).
(a) Organization of the Seller. The Seller is a corporation duly
organized and validly existing under the laws of England.
(b) Authorization of Transaction. The Seller has full power and
authority to execute and deliver this Agreement and to perform its obligations
hereunder. Without limiting the generality of the foregoing, the
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board of directors of the Seller and the Shareholder have duly authorized the
execution, delivery, and performance of this Agreement by the Seller. This
Agreement constitutes the valid and legally binding obligation of the Seller,
enforceable in accordance with its terms and conditions,
(c) Noncontravention. To the Knowledge of the Seller, neither the
execution and the delivery of this Agreement, nor the consummation of the
transactions contemplated hereby will (i) violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge, or
other restriction of any government, governmental agency, or court to which the
Seller is subject or any provision of the Memorandum and Articles of
Association of the Seller or (ii) conflict with, result in a breach of,
constitute a default under, result in the acceleration of, create in any party
the right to accelerate, terminate, modify, or cancel, or require any notice or
consent under any agreement, contract, lease, licence, instrument, or other
arrangement to which the Seller is a party or by which it is bound or to which
any of its assets is subject, except where the violation, conflict, breach,
default, acceleration, termination, modification, cancellation, failure to give
notice or obtain consent, or security interest would not have a material
adverse effect on any of the Acquired Assets, the financial condition of the
Seller or on the ability of the Parties to consummate the transactions
contemplated by this Agreement.
(d) Title to Property and Assets. The Seller has good and marketable
title to all of the Acquired Assets subject to no mortgage, pledge, lien,
security interest, lease, charge, encumbrance or conditional sale except for
liens for taxes not yet due and payable.
(e) Other Transfer Instruments. Following the Closing, at the
request of the Buyer, the Seller shall deliver any further instruments of
transfer and take all reasonable action as may be necessary or appropriate (A)
to vest in the Buyer all of the Seller's title to the Acquired Assets, and (B)
to transfer to the Buyer all of the Seller's rights to licenses and permits
necessary for the operation of the Acquired Assets.
4. Representations and Warranties of the Buyer. The Buyer represents
and warrants to the Seller that the statements contained in this SECTION 4 are
correct and complete as of the date of this Agreement and will be correct and
complete as of the Closing Date (as though made then and as though the Closing
Date were substituted for the date of this Agreement throughout this SECTION
4).
(a) Organization of the Buyer. The Buyer is a limited liability
company duly organized and validly existing under the laws of England.
(b) Authorization of Transaction. The Buyer has full power and
authority (including full corporate power and authority) to execute and deliver
this Agreement and to perform its obligations hereunder. This Agreement
constitutes the valid and legally binding obligation of the Buyer, enforceable
in accordance with its terms and conditions.
(c) Noncontravention. Neither the execution and the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby will
(i) violate any constitution, statute, regulation, rule, injunction, judgment,
order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which the Buyer is subject or any provision
of its Memorandum and Articles of Association or (ii) conflict with, result in
a breach of, constitute a default under, result in the acceleration of, create
in any party the right to accelerate, terminate, modify, or cancel, or require
any notice under any agreement, contract, lease, licence, instrument, or other
arrangement to which the Buyer is a party or by which it is bound or to which
any of its assets is subject. The Buyer does not need to give any notice to,
make any filing with, or obtain any authorization, consent, or approval of any
government or governmental agency in
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order for the Parties to consummate the transactions contemplated by this
Agreement (including the assignments and assumptions referred to in SECTION 6
hereof).
(d) Physical Condition. The Buyer has inspected the physical
condition of all the Acquired Assets. The Buyer covenants that it will accept
the conveyance of the Acquired Assets, "as is, where is" in their present state
and condition, subject to reasonable use from the date hereof up to the
Closing.
5. Deliveries at Closing.
(a) Documents to be Delivered by the Buyer. At the Closing, the
Buyer shall deliver the following instruments and documents to the Seller:
(i) the Buyer Note in the form attached hereto as EXHIBIT
2(C) in the principal amount of Two Hundred Fifty Thousand United
States Dollars ($250,000 U.S.);
(ii) certified resolutions of the Buyer's board of directors
and shareholders, in a form satisfactory to the Seller's legal
advisers authorizing the execution and performance of the Agreement
and all other actions to be taken by the Buyer hereunder;
(iii) the Security Agreement in the form attached hereto as
EXHIBIT 5(A)(III) and any required financing statements securing the
obligations of the Buyer under the terms of the Buyer Note;
(iv) an opinion of the Buyer's Solicitor in a form reasonably
satisfactory to Seller's Legal Advisor regarding the validity of the
transactions contemplated hereby;
(v) an executed Distribution Agreement between the Buyer and
the Shareholder in the form attached hereto as EXHIBIT 5(A)(V);
(vi) an Assignment and Assumption Agreement with respect to
the Assumed Liabilities, in the form attached hereto as EXHIBIT
5(A)(VI);
(vii) Written confirmation from the Buyer or its shareholders
to the Seller and its Legal Advisor that the Buyer has at least Four
Hundred Thousand United States Dollars ($400,000 U.S.) available for
working capital at the Closing.
(viii) such other documents as Seller may reasonably request
to effect the transactions contemplated by this Agreement.
(b) Documents to be Delivered by Seller. At the Closing, the Seller
shall deliver the following instruments and documents to the Buyer:
(i) a Bill of Sale regarding the tangible personal property
in the form attached hereto as EXHIBIT 5(B)(I)
(ii) certified resolutions of the Seller's board of directors
and Shareholder, in a form satisfactory to the Buyer's solicitors,
authorizing the execution and performance of the Agreement and all
other actions to be taken by the Seller hereunder;
(iii) all documents referred to in SECTION 5(A) which require
execution by the Seller; and
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(iv) such other documents as the Buyer may reasonably request
to effect the transactions contemplated by this Agreement.
6. Employees.
(a) Affected Employees. "Affected Employees" shall mean all
employees of the Seller, a list of whom is attached hereto as SCHEDULE 6(A), on
the Closing Date.
(i) It is acknowledged and agreed by the parties that the sale of the
Acquired Assets hereunder constitutes a "relevant transfer" for the
purposes of the Transfer of Undertakings (Protection of Employment)
Regulations 1981 ("the Transfer Regulations") and that accordingly the
contracts of employment of the Affected Employees will, at Closing, be
transferred to the Buyer as provided by the Transfer Regulations.
(ii) The Seller shall:
(x) forthwith comply with any statutory or other duty to give
information and to consult representatives of any recognized trade
union and the Affected Employees about the transfer pursuant to the
Transfer Regulations of their contracts of employment from the Seller
to the Buyer; and
(y) before Closing pay to each of the Affected Employees all
emoluments (including bonuses and other benefits, but excluding
accrued holiday pay) due to him for the period ending on the Closing
Date.
(iii) All salaries and other emoluments, including holiday pay, tax
and national insurance payments and contributions to retirement
benefit schemes, relating to the Affected Employees shall be borne by
the Seller up to the Closing Date and all necessary apportionments
shall be made.
(iv) The Buyer shall forthwith give to the Seller such information
concerning the measures envisaged by the Buyer relating to the
Affected Employees as will enable the Seller to perform its duty
pursuant to subclause (c)(i) above.
(b) Responsibilities. The Seller agrees to satisfy, or cause its
insurance carriers to satisfy, all claims for medical, health and hospital
benefits, whether insured or otherwise under the Seller's benefit plans,
brought by, or in respect of, Affected Employees and former employees of the
Seller for events occurring prior to the Closing Date, in accordance with the
terms and conditions of such benefit plans without interruption as a result of
the employment by the Buyer of any such employees after the Closing Date. The
Buyer shall be responsible for any claims arising as a result of events
occurring on or after the Closing Date.
(c) Indemnity. Notwithstanding the foregoing provisions of this
clause in the event that any of the Affected Employees at any time after the
Closing Date are paid or awarded any monies by way of compensation for
redundancy, unfair dismissal or wrongful dismissal whether voluntarily by the
Buyer or following the order of a court or tribunal then the Seller shall
reimburse the Buyer on an indemnity basis an amount equal to such part of any
such monies as have to be paid/are awarded which are in excess of the
compensation which that employee would have been entitled to had his employment
with the Buyer only commenced in law on or after the Closing Date.
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<PAGE> 10
7. Miscellaneous.
(a) Survival of Representations and Warranties. The representations
and warranties of the Parties contained in this Agreement shall not survive the
Closing hereunder.
(b) No Third-Party Beneficiaries. This Agreement shall not confer
any rights or remedies upon any Person other than the Parties and their
respective successors and permitted assigns.
(c) Entire Agreement. This Agreement (including the documents
referred to herein) constitutes the entire agreement between the Parties and
supersedes any prior understandings, agreements, or representations by or
between the Parties, written or oral, to the extent they related in any way to
the subject matter hereof.
(d) Succession and Assignment. This Agreement shall be binding upon
and inure to the benefit of the Parties named herein and their respective
successors and permitted assigns. No Party may assign either this Agreement or
any of its rights, interests, or obligations hereunder without the prior
written approval of the other Party.
(e) Relationship between the Parties. This Agreement shall not
create the relationship of principal and agent between the Parties. The Buyer
shall have no authority to make any commitment on behalf of the Seller and the
Seller shall have no authority to make any commitment on behalf of the Buyer.
The Buyer represents and warrants that it shall not act or represent itself to
be an agent for the Seller, nor to create or attempt to create any obligation
or liability on behalf of the Seller. The Seller warrants that it shall not
act as or represent itself to be an agent for the Buyer, nor create or attempt
to create any obligation on behalf of the Buyer.
(f) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.
(g) Headings. The section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
(h) Notices. All notices, requests, demands, claims, and other
communications hereunder will be in writing. Any notice, request, demand,
claim, or other communication hereunder shall be deemed duly given if (and then
two business days after) it is sent by registered or certified mail, return
receipt requested, postage prepaid, and addressed to the intended recipient as
set forth below:
If to the Seller: Copy to:
Charles R. Evans G. Robert Morris, Esq.
National Safety Associates of Baker, Donelson, Bearman & Caldwell
of America (U.K.) Limited 165 Madison Ave., Suite 2000
39 Queen Street Memphis, Tennessee 38103
Maidenhead
Berkshire
SL6 1NB
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<PAGE> 11
If to the Buyer: Copy to:
Charles G. Elliott Katharine Mellor
Nova Vita Limited Elliott & Company, Solicitors
39 Queen Street Centurion House, Deansgate,
Maidenhead Manchester M3 3WT,
Berkshire SL6 1NB United Kingdom
Any party may send any notice, request, demand, claim or other
communication hereunder to the intended recipient at the address set forth
above, using any other means (including personal delivery, expedited courier,
messenger service, telecopy, telex, facsimile, ordinary mail, or electronic
mail), and such notice, request, demand, claim or other communication shall be
deemed in the absence of manifest error to have been received within 48 hours
after dispatch (in the case of ordinary mail) on signature of receipt (for
messenger service and personal delivery) and on confirmation of dispatch (in
the case of facsimile or electronic mail).
(i) Amendments and Waivers. No amendment of any provision of this
Agreement shall be valid unless the same shall be in writing and signed by the
Buyer and the Seller. The Seller may consent to any such amendment at any time
prior to the Closing with the prior authorization of its board of directors;
provided, however, that any amendment effected after the Shareholder has
approved this Agreement will be subject to any restrictions or actions required
by applicable law. No waiver by any Party of any default, misrepresentation,
or breach of warranty or covenant hereunder, whether intentional or not, shall
be deemed to extend to any prior or subsequent default, misrepresentation, or
breach of warranty or covenant hereunder or affect in any way any rights
arising by virtue of any prior or subsequent such occurrence.
(j) Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction shall not affect
the validity or enforceability of the remaining terms and provisions hereof or
the validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction.
(k) Expenses. The Buyer and the Seller will bear their own costs and
expenses (including legal fees and expenses) incurred in connection with this
Agreement and the transactions contemplated hereby.
(l) Construction. The Parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the Parties and no presumption or burden of proof
shall arise favoring any Party by virtue of the authorship of any of the
provisions of this Agreement. Any reference to any statute, law or regulation
shall be deemed also to refer to all rules and regulations promulgated
thereunder, unless the context requires otherwise. The word "including" shall
mean including without limitation.
(m) Incorporation of Exhibits and Schedules. The Exhibits and
Schedules identified in this Agreement are incorporated herein by reference and
made a part hereof. The Parties agree and acknowledge that the Exhibits and
Schedules will be prepared jointly by the Parties.
(n) Condition of the Acquired Assets. THE ACQUIRED ASSETS SHALL BE
DELIVERED TO THE BUYER "AS IS" AND EXCEPT AS SPECIFICALLY SET FORTH HEREIN THE
SELLER MAKES NO WARRANTIES, GUARANTIES, OR REPRESENTATIONS OF ANY KIND, EITHER
EXPRESS OR IMPLIED, ARISING BY LAW OR OTHERWISE WITH RESPECT TO THE ACQUIRED
ASSETS, AND THE SELLER SHALL HAVE NO LIABILITY OR OBLIGATION RESULTING FROM ANY
SUCH
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<PAGE> 12
REPRESENTATION OR WARRANTY OF MERCHANTABILITY OR IMPLIED WARRANTY OF FITNESS
FOR A PARTICULAR PURPOSE.
(o) Attorney's Fees. If any legal action or arbitration or other
proceeding is brought for the enforcement of this Agreement or because of an
alleged dispute, breach, default or misrepresentation in connection with any of
the provisions of this Agreement, the prevailing party or parties shall be
entitled to recover reasonable attorney's fees and other costs incurred in such
action or proceeding, in addition to any other relief to which it or they may
be entitled.
(p) Premises. The Buyer and the Seller shall, at Closing, enter into
a licence for the Buyer's use of the Seller's premises at 39 Queen Street,
Maidenhead, which shall expire on or before March 31, 1997, in the form
attached as EXHIBIT 7(P).
(q) Governing Law. This Asset Purchase Agreement and the Bill of
Sale attached hereto as EXHIBIT 5(B)(I) shall be governed by and construed in
accordance with the laws of England and the parties submit to the non-exclusive
jurisdiction of the Courts of England. The governing law of the Buyer Note,
Security Agreement, Distribution Agreement, and Assignment and Assumption
Agreements shall be as set forth in each of these documents and agreements.
8. Value Added Tax.
(a) The parties shall use all reasonable endeavours to procure that
the sale of the Acquired Assets is deemed to be a transfer of a business as a
going concern for the purposes of the Value Added Tax Act 1994 Section 49 and
Schedule 4 paragraph 8(1)(a).
(b) The Seller shall forthwith deliver to the Buyer all the records
relating to the Acquired Assets for Value Added Tax purposes which are required
by the Value Added Tax Act 1994 Section 49 (1)(b) to be preserved by the Buyer.
(c) The Buyer shall for a period of not less than six years from the
Closing Date preserve the records delivered to it by the Seller and upon
reasonable notice make them available to the Seller or its agents during normal
business hours.
(d) Notwithstanding the provisions of SECTION 8(B) hereof, the
Seller, or its designee in the United Kingdom, shall use its reasonable best
efforts to obtain a direction from HM Customs & Excise that the Seller remains
liable to ensure that the records required to be preserved by the Value Added
Tax Act 1994 Section 49(1)(b) shall be preserved for a period of not less than
six (6) years from the Closing Date.
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<PAGE> 13
AS WITNESS the hands of the duly authorized representatives of the
Parties the date first above written.
Signed by Charles Elliot for and
on behalf of BUYER:
NOVA VITA LIMITED
/s/ Charles Elliot
--------------------------------
Title: Director
Signed by Darlene Baker for and
on behalf of SELLER:
NATIONAL SAFETY ASSOCIATES OF
AMERICA (U.K.) LIMITED
/s/ Darlene Baker
--------------------------------
Title: Director
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