Assumption of Certain Liabilities. (a) On the terms of and subject to the conditions set forth herein, Purchaser shall (i) assume at the Closing and discharge or perform when due the Assumed Liabilities on and after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers. (b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract. (c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties. (d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation. (e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 2 contracts
Sources: Asset Purchase Agreement, Asset Purchase Agreement (New Century Financial Corp)
Assumption of Certain Liabilities. (a) On the terms of and subject to the conditions set forth herein, Purchaser shall (i) assume at the Closing and discharge or perform when due the Assumed Liabilities on and after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in expressly contemplated by this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities1.4, Purchaser shall not assume any Liability Liabilities of any nature Seller (whether or kind whatsoever of Sellers.
(b) From time not related to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business DayTransferred Assets, the next succeeding Business Day or the Excluded Assets). At the Closing, Purchaser shall (A) assume the lesser of (x) One Million Five Hundred Thousand Dollars ($1,500,000) of indebtedness under the Sallyport Facility and (y) the actual amount of indebtedness under the Sallyport Facility (including the principal amount thereof and accrued and unpaid interest thereunder) (the “Contract Notification DeadlineSallyport Assumed Debt Amount”); (B) assume Seller’s obligation to refund a security deposit in the amount of Five Hundred Forty-Eight Thousand Three Hundred Sixty-Four Dollars ($548,364) (the “Security Deposit Amount”) to its subtenant pursuant to the Sublease Agreement, dated as of December 27, 2017, between Say Media, Inc. and Cloudpassage, Inc., at the end of such sub-tenancy on or about August 31, 2018; (C) assume, discharge and perform as and when due all of the obligations of Seller under the Seller Contracts identified on Schedule 1.1(d) and under the Real Property Leases; provided, however, if Seller shall not have obtained, prior to the Closing Date, any Consent required to be obtained from any Person with respect to the assignment or delegation to Purchaser shallof any rights or obligations under a Seller Contract identified on Schedule 1.1(d), the respective benefits and burdens under such Seller Contract shall be treated as set forth in Section 6.11; (D) assume Seller’s obligations with respect to all sales commissions that remain unpaid as of the Closing payable to any Seller Service Provider with respect to Seller’s second and third fiscal quarters of its sole discretionfiscal year ending December 31, notify Sellers 2018; (E) assume the Liabilities of Seller set forth on Schedule 1.4; and (iF) each Assigned Contract that Purchaser has agreed the Liabilities of Seller arising in the ordinary course of business from and after July 31, 2018 through to assume and including the Closing (each, an “Accepted Contract” andclauses (A) through (F), collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded ContractsAssumed Liabilities”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 2 contracts
Sources: Asset Purchase Agreement, Asset Purchase Agreement (theMaven, Inc.)
Assumption of Certain Liabilities. (a) On the terms of and subject a. Notwithstanding anything contained in this Agreement or in any Exhibit to the conditions set forth hereincontrary, Purchaser shall (i) assume at the Closing and discharge or perform when due the Assumed Liabilities on and after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that Buyer is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser and shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance liabilities of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser Business or of the Assigned Contracts is approvedSeller, subject only to (A) payment by Purchaser except for the following liabilities of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related Seller pertaining solely to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 operation of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date (the “Assumed Liabilities”):
i. The obligations of Seller and at Purchaser’s sole cost related payment requirements from and expenseafter the Closing Date under the unexpired facility leases for the office of Seller as set forth on the Schedule of Lease Obligations attached hereto as Exhibit 5-A1.
ii. The obligations of Seller and related payment requirements from and after the Closing Date under any equipment lease, a subcontract, sublease lease/purchase or sublicensemaintenance agreements for those items of office equipment to be purchased by Buyer pursuant to this Agreement, as may set forth on the Schedule of Equipment Leases attached hereto as Exhibit 5-A2.
iii. The obligation to pay the Buyer’s customary and normal commissions with respect to mortgage transactions which are pending at the time of Closing and which are finalized following Closing.
iv. The obligation to pay to Shareholder monthly rent in the amount of SIX THOUSAND FOUR HUNDRED ELEVEN and 45/100 Dollars ($6,411.45), as well as one prorated payment of THREE THOUSAND TWO HUNDRED FIVE and 73/100 Dollars ($3,205.73), that has been prepaid by Seller Parties through March 2007. Such amount shall be applicable, to Sellers’ rights Related paid pursuant to the Business pursuant to such Assigned ContractPromissory Note.
b. Notwithstanding anything contained in this Agreement or in any Exhibit to the contrary, Buyer does not assume any liability not being identified herein as being assumed by Buyer, and in particular (cby way of illustration and not limitation) With respect Buyer does not assume any of the following liabilities, which liabilities will remain the obligations of Seller (such liabilities are herein collectively referred to each Assigned Contractas the “Excluded Liabilities”):
i. Any and all trade payables outstanding, Sellers shallaccrued to, within 60 days after or due as of the later Closing Date.
ii. Any and all accrued salaries, overtime pay, vacation pay, holiday pay, accrued time off pay of any type, expenses and other employee compensation for both temporary and permanent employees of Seller payable up to the Closing Date unless otherwise assumed hereunder.
iii. FICA, withholding, and other payroll related taxes payable up to the Closing Date for any and all periods prior to the Closing Date.
iv. Sales tax obligations for any and all services rendered prior to the Closing Date.
v. Other taxes, fees and assessments payable by Seller or accrued as of the Closing Date.
vi. Audit or other similar adjustments, including any penalties or fines, related to FICA and other payroll taxes, sales taxes, retirement plan contributions, workers’ compensation insurance and similar expenses subject to audits and adjustments for occurrences and time periods prior to the Closing Date.
vii. Federal and state taxes on income earned by Seller prior to the Closing Date and accrued to or payable as of the Closing Date.
viii. Revolving credit line obligations or other short term bank borrowings, long term bank loans or installment payment debts of Seller.
ix. Notes and other financial instruments payable by Seller.
x. Any and all notes payable, advances, deferred compensation or other debts owed to Shareholders, or any other employee of, or contractor to, Seller, including any payments related to compensation, vacation pay, sick pay, fringe benefits, or reimbursable expenses related to the employment of, or services performed by, any of such individuals prior to the Closing Date.
xi. Any and all other liabilities of Seller existing as of the Closing Date and not specifically listed as being assumed by Buyer in Section 5a of this Agreement.
xii. Any contingent or unstated liabilities of Seller including, but not limited to, liabilities occurring as a result of legal actions, suits or other claims and resulting from actions or other occurrences which took place prior to the Closing Date.
c. All of the Assets shall be free of any liens, claims, liabilities, charges, restrictions, royalties, fees or other encumbrances other than (i) liens for Taxes which are not due and payable as of the Contract Determination Date for such Assigned Contract or Closing Date, (ii) the Contract Notification Deadlineleases set forth on the Schedule of Lease Obligations at Exhibit 5-A1, advise Purchaser in writing (iii) the equipment leases, lease/purchase or maintenance agreements set forth on the Schedule of Equipment Leases at Exhibit 5-A2, and (iv) encumbrances which would not have a material adverse effect on the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional ContractsPermitted Encumbrances”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to No later than the Closing Date, Sellers the Seller shall file a Supplemental Motion with secure written releases for the Bankruptcy Court for entry Assets acquired from the holder of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement lien, security interest or other obligation of the parties thereto in accordance with the terms Seller related to any lien, security interest or other encumbrance attaching to all or any category of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreementassets of Seller.
Appears in 2 contracts
Sources: Agreement for Sale and Purchase of Assets (MBI Financial, Inc.), Agreement for Sale and Purchase of Assets (MBI Financial, Inc.)
Assumption of Certain Liabilities. At the Closing, the Buyer will assume the following specified Liabilities of the Company (a) On the terms “Assumed Liabilities”), but no others:
2.7.1 all Liabilities for post-Closing performance under the Contracts arising after the Closing other than liabilities arising from any violation, breach or default of and subject legal requirements or contractual obligations by the Company occurring prior to the conditions Closing;
2.7.2 all accounts payable, to the extent the same are reflected on the Estimated Closing Balance Sheet and will be reflected on the Closing Balance Sheet;
2.7.3 all other Liabilities reflected in the Most Recent Balance Sheet (including any notes thereto), to the extent they have not been paid or discharged prior to the Closing, and all Liabilities (other than the Retained Liabilities) incurred, from the date thereof through the Closing, in the Ordinary Course of Business and which do not have, and are not reasonably likely to have, a Material Adverse Effect;
2.7.4 except as otherwise specifically provided herein, any Liability of the Company as of the Closing Date in respect of accrued salary and wages and Flexible Time Off of Transferred Employees, in each case solely to the extent the same are reflected on the Closing Balance sheet;
2.7.5 any Liability of the Company under any Contractual Obligation entered into in the Ordinary Course of Business and which does not have, and is not reasonably likely to have, a Material Adverse Effect;
2.7.6 any Liability of the Company with respect to the capital expenditures listed on Schedule 2.7.6; and
2.7.7 all Liabilities as of the Closing set forth hereinin Schedule 2.7.7. Notwithstanding any provision in this Agreement to the contrary, Purchaser the Buyer is not assuming, and shall (i) assume at not be deemed to have assumed, any obligations or liabilities of the Closing and discharge or perform when due Company of whatever nature other than the Assumed Liabilities on and after specifically described above. No assumption by the Closing Date and (ii) assume all obligations for and pay and discharge when due Buyer of any of the Cure Amounts relating Assumed Liabilities shall relieve or be deemed to each Assigned Contract at relieve any of the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in Sellers from any obligation or liability under this Section 2.7, Purchaser shall not assume or have any Liability or responsibility Agreement with respect to any Liability representations or warranties made by the Sellers or any of any nature or kind whatsoever relating them to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of SellersBuyer.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Assumption of Certain Liabilities. (a) On a. Upon the terms of and subject to the conditions set forth hereinof this Agreement, Purchaser shall hereby assumes and agrees to pay, perform and discharge when due, effective as of the Closing, only the following liabilities exclusively relating to the Acquired Assets or the Business (the "Assumed Liabilities"):
(i) assume at the Closing and discharge or perform when due the Assumed all Current Liabilities on and after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever exclusively relating to the Business or the Purchased Acquired Assets that exists, or arises out to the maximum of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contractamounts reflected on the Interim Balance Sheet, plus (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of and all liabilities, obligations and commitments incurred after the Bankruptcy Code Interim Balance Sheet date and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From Agreement, in the date hereof until ordinary course of business, and consistent with prior practice;
(ii) all obligations and liabilities of Seller under the Contract Notification DeadlineAcquired Contracts set forth on SCHEDULE 4.9a, Sellers shall not reject excluding any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaserobligations or liabilities for any breach thereof occurring prior to the Closing or resulting from Seller's performance or non- performance prior to the Closing except as described in detail on SCHEDULE 4.9b; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d)Required Consent Contract, Purchaser shall pay assume the legal fees of Sellers involved obligations thereunder only to the extent set forth in any such litigation.SECTION 2.5a;
(eiii) Prior all obligations or liabilities for sales, use, transfer, documentary or registration taxes, charges or levies imposed by any government (in its capacity as a government and not as a customer or vendor) or any similar taxes (but not including any income, franchise or business and occupation taxes) arising from or associated with the sale and transfer from Seller to Purchaser of the Acquired Assets, the license by Seller of the Licensed Intellectual Property, the execution and delivery of the Ancillary Agreements and other documents contemplated by this Agreement or the assumption by Purchaser of the Assumed Liabilities; and
(iv) notwithstanding SECTION 2.6b(iii), all obligations and liabilities for Taxes attributable to the operation of the Business or ownership of the Acquired Assets subsequent to the Closing Date. To the extent that a taxable period encompasses but does not end on the Closing Date, Sellers the Parties agree that Taxes pertaining to the Acquired Assets or the Business shall file be allocated between the Parties. Taxes in the nature of ad valorem taxes, including real and personal property taxes, shall be allocated on a Supplemental Motion per diem basis according to the number of days during such period the Acquired Assets were owned by each Party. Taxes measured by gross or net income or gross receipts shall be allocated on a "closing of the books" basis, with Seller liable for Taxes arising out of the Bankruptcy Court operation of the Business and ownership of the Acquired Assets through the Closing Date (excluding any Taxes arising from action of the Purchaser not in the ordinary course of business on the Closing Date but after the Closing). Notwithstanding anything else in this Agreement to the contrary, Purchaser shall not assume or be responsible for entry any obligations of a Supplemental Order to assume Seller except the Assumed Liabilities. The Assumed Liabilities do not include any of the Excluded Liabilities.
b. All other liabilities of Seller (including the NMO Unit) and assign to Purchaser any Ancillary Servicing-Related Agreements that have its Affiliates shall be deemed "Excluded Liabilities" and shall not otherwise been be assumed by Sellers Purchaser. Excluded Liabilities shall include all obligations and assigned liabilities:
(i) of Seller under this Agreement, the Ancillary Agreements, and any other agreements, instruments and certificates delivered in connection with this Agreement;
(ii) related to any of the Excluded Assets;
(iii) subject to SECTION 2.6a(iv), for Taxes attributable to the operation of the Business or ownership of the Acquired Assets on or prior to the Closing Date;
(iv) under Employment Agreements;
(v) under consulting agreements not specifically acquired by Purchaser by agreement inclusion on SCHEDULE 4.9a;
(vi) under all Employment Benefit Plans of Seller and Affiliates of Seller;
(vii) without limiting the generality of SECTION 7.1e, arising out of or related to the employment of any person by Seller, including the termination by Seller of such person; and
(viii) relating to or arising out of the parties thereto in accordance with the terms operation of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to Business, the Cure Amount relating to any such Ancillary Servicing-Related Agreementownership of the Acquired Assets or the ownership of the Licensed Intellectual Property, except as included in Assumed Liabilities or in SECTION 2.5a.
Appears in 1 contract
Sources: Asset Purchase Agreement (Tcsi Corp)
Assumption of Certain Liabilities. (a) On the terms Closing Date, Buyer shall not be obligated to assume, and shall not assume, any of and subject the liabilities or obligations of Seller (absolute, accrued, contingent or otherwise), whether existing prior to the conditions set forth herein, Purchaser shall (i) assume at or as of the Closing and discharge Date, or perform when due the Assumed Liabilities on and asserted after the Closing Date and relating to events that occurred before the Closing Date, or otherwise, except Buyer shall assume and agrees to pay, perform and discharge, in accordance with their respective terms, the following (collectively referred to herein as the "Assumed Liabilities"):
(a) all obligations of Seller arising in the ordinary course of business under the Assigned Leases or the Assigned Contracts to the extent transferable;
(b) all trade accounts payable, customer deposits and accrued expenses, but not any accrued income or sales taxes or employee related expenses including, but not limited to, withholding taxes, 401(k) withholdings or matching contributions, company payroll taxes, vacation accruals, bonuses, miscellaneous withholdings, or accrued salaries and wages, associated with the Assets of Seller as of the Closing Date arising in the ordinary course of business;
(c) the obligations of Seller as of the Closing Date to fill orders received by Seller in the ordinary course of business (i) for the manufacture and sale of lodging and office furniture, (ii) assume for the sale of parts, or (iii) for service and maintenance of said furniture or parts; and
(d) the other obligations and liabilities of Seller that are listed on Exhibit 1.7 hereto. Nothing in this Agreement shall be deemed to create any obligation on the part of Buyer to continue the employment of any individual or to create any contract right or entitlement with respect thereto. Buyer shall have no responsibility for any amounts, obligations, liabilities, compensation, severance pay or benefits of any kind or nature due to Seller's employees through the Closing Date or arising as a result of the termination by Seller of any such employees in connection with the transactions contemplated by this Agreement, including, without limitation, any benefits that may arise under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, and any and all such liabilities and obligations shall be the sole responsibility of Seller. Seller shall prepare and file all payroll reports and Forms W-2 for and pay and discharge when due its employees through the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded ContractsClosing Date. Except as set forth Unless expressly stated in this Section 2.71.7 or in Exhibit 1.7, Purchaser nothing in this Agreement shall not assume or have be deemed to create any Liability or responsibility obligation on behalf of the Buyer with respect regard to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises liabilities arising out of the operation of the Seller's Business or the ownership of the Purchased Assets prior to or the Business, prior to, at or after, through the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability Date of any nature whatsoever, whether known or kind whatsoever of Sellers.
(b) From time to time after the date hereofunknown, direct or indirect, contingent or accrued, matured or unmatured including, but in no event later than 60 days following the Closing Date ornot limited to, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible claims for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution violation of any assumption objection under Section 365(c)(1) statutes, laws, regulations, rules, ordinances or (c)(2) orders of the Bankruptcy Code any authority, whether federal, state or local, tax claims or tax liens, labor relation claims, OSHA related claims, EEOC related claims, employee benefit claims, ERISA related claims, employee claims, environmental, health and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadlinesafety claims, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; providedEPCRA related claims, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible forproduct warranty, product return and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date product liability claims for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal products sold prior to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to through the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court medical, dental and workers' compensation claims, computer software license claims, claims for entry personal injury, claims for injury to property, claims for breach of a Supplemental Order to assume contract, claims for compensatory damages, claims for punitive damages, creditor claims, claims by lenders, claims on accounts, claims for unpaid debts, any and assign to Purchaser all claims by Seller's shareholders, and any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement all litigation arising out of the parties thereto in accordance with the terms foregoing claims. All liabilities of the Sale Approval Order. Sellers Seller not herein defined as Assumed Liabilities shall retain all liabilities and obligations with respect hereinafter be referred to as the Cure Amount relating to any such Ancillary Servicing-Related Agreement"Retained Liabilities."
Appears in 1 contract
Assumption of Certain Liabilities. (a) On Subject to the terms and --------------------------------- conditions of and subject to this Agreement, except as otherwise specifically provided in this Section 1.2 (including in respect of the conditions Retained Liabilities, as set forth hereinin paragraph (b) below), Purchaser shall on the Closing Date, Buyer will assume and agree to pay, discharge or perform, as appropriate, the following specific liabilities and obligations of Sellers (the "Assumed Liabilities"): -------------------
(i) all executory liabilities and obligations of Sellers in respect of the Contracts arising after Closing, except that Buyer shall not assume at the Closing and or agree to pay, discharge or perform when due any
(1) liabilities or obligations of the Assumed Liabilities on and after aforesaid character existing as of the Closing Date and which under GAAP should have been accrued or reserved for on a balance sheet as a liability or obligation; and
(2) liabilities or obligations arising out of any breach or default (including for this purpose any event which, with notice or lapse of time would constitute such a breach or default) by Sellers or any of their Affiliates of any provision of any Contract, including liabilities or obligations arising out of Sellers' or any of their Affiliates' failure to perform any agreement, contract, commitment or lease in accordance with its terms prior to the Closing;
(ii) the trade payables of the Business set forth in detail on Schedule 1.2(a)(ii) and reflected on the Closing Balance Sheet or if no Closing ------------------- Balance Sheet is prepared, on the Interim Balance Sheet; and
(iii) accruals for payroll, payroll taxes, vacation and holiday pay, and bonuses for calendar 2000 for Transferred Employees made in accordance with GAAP and consistent with past practices and reflected on the Closing Balance Sheet or if no Closing Balance Sheet is prepared, on the Interim Balance Sheet.
(b) Buyer will not assume any liabilities, commitments or obligations (known or unknown, contingent or absolute and whether or not determinable as of the Closing) of Sellers or any of their Affiliates except for the Assumed Liabilities as specifically and expressly provided for above, whether such liabilities or obligations relate to payment, performance or otherwise, and all liabilities, commitments or obligations (known or unknown, contingent or absolute and whether or not determinable as of the Closing) not expressly transferred to Buyer hereunder as Assumed Liabilities are being retained by Sellers or their Affiliates (the "Retained Liabilities"), who shall remain -------------------- liable therefor unconditionally and without right of set-off; Sellers, on behalf of themselves and their Affiliates, hereby irrevocably and unconditionally waive and release Buyer from all Retained Liabilities, including any Retained Liabilities created by statute or common law. Without limitation to the foregoing, all of the following shall be considered Retained Liabilities and not Assumed Liabilities for and pay and discharge the purposes of this Agreement (whether or not accrued or reserved for on the Interim Balance Sheet):
(i) any product liability or similar claim for injury to person or property, regardless of when due made or asserted, which arises out of or is based upon a theory of strict liability under Section 402A of the Cure Amounts Restatement (2nd) of Torts, negligence, gross negligence or any analogous or similar provision of statutory or common law, or any express or implied representation, warranty, agreement or guarantee made by Sellers or their Affiliates or alleged to have been made by Sellers or their Affiliates or which is imposed or asserted to be imposed by operation of law, in connection with any service performed or product manufactured, sold or leased by or on behalf of Sellers or their Affiliates, including any such claim relating to each Assigned Contract at any product delivered in connection with the respective Contract Determination performance of such service and any such claim seeking recovery for consequential damages, lost revenue or income;
(ii) any federal, state, foreign or local Tax (as defined in Section 2.13(c)) (A) payable with respect to the business, assets, properties or operations of Sellers, any predecessor of Sellers or any member of any affiliated group of which any of them is a member, for any period (1) ending prior to the Closing Date or (2) beginning before and ending after the Closing Date, (B) incident to or arising as a consequence of the negotiation or consummation by Sellers (or, any predecessor of Sellers or any member of any affiliated group of which any of them is a member) of this Agreement and the transactions contemplated hereby or (C) payable with respect to any business, assets, properties, or operations of Sellers, any predecessor of Sellers or any of their Affiliates other than the Business, for such Assigned Contract; provided, that, any taxable period;
(iii) except as set forth in Section 2.7(b)1.2(a)(iii) and Section 4.5, in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume any liability or have any Liability or responsibility obligation with respect to any Liability compensation or employee benefits of any nature owed to any employees, former employees, agents or kind whatsoever relating to independent contractors of Sellers or any of their Affiliates, whether or not employed by Buyer after the Business or the Purchased Assets Closing, that exists, or (A) arises out of or relates to the operation employment or ownership service provider relationship between such Sellers, or such Affiliates and any such individuals, (B) arises out of the Purchased Assets or the Business, prior to, at relates to any Benefit Plan or after, (C) arises out of or relates to events or conditions occurring on or before the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.Date;
(biv) From time to time after any liability or obligation of Sellers or their Affiliates, arising or incurred in connection with the date hereofnegotiation, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers preparation and execution of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement and the transactions contemplated hereby, and fees and expenses of counsel, accountants, brokers, finders and other experts;
(whether v) any liability or obligation of Sellers or any of their Affiliates existing as a result of an inaccuracy any act, failure to act or other state of facts or occurrence which constitutes a breach or violation of Sellers' representations, warranties and covenants contained in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement or the other Transaction Documents (whether as defined in Section 1.7);
(vi) any Environmental Liability (as defined in Section 7.15);
(vii) any liability of Sellers or the Business to Sellers or any of Sellers' Affiliates incurred prior to the Closing, including any intercompany payables or receivable credits specified in the Interim Balance Sheet (the "Intercompany Payables"); ---------------------
(viii) any liability under applicable bulk transfer laws, or similar statutes, laws or regulations, including without limitation, state or local tax laws or creditor related laws, arising as a result of an inaccuracy in a representation or warranty or breach of a covenantthe transactions contemplated by this Agreement; or
(ix) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf any other liability of Sellers underor their Affiliates whatsoever, each Assigned Contractincluding any liability arising out of or relating to the ownership or operation of the Acquired Assets (including any liability or indebtedness associated with the Community Economic Betterment Account Agreement, together with all among the Iowa Department of Sellers’ reasonableEconomic Development, necessarythe City of Keokuk and Keokuk Steel Castings, ordinary courseInc. dated June 20, post-Closing obligations that are specifically attributable 1991) and the Business on or prior to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7(including any predecessor operations), Purchaser’s Carrying Costs shall not include including any attorneys’ claims, obligations or financial advisory fees litigation arising from and directly related out of or relating to the Bankruptcy Cases events or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between conditions occurring on or before the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to (including the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease threatened or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be pending litigation set forth on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(dSchedule 2.20 hereto), Purchaser shall pay regardless ------------- of when made or asserted, except for the legal fees of Sellers involved in any such litigationAssumed Liabilities as specifically and expressly set forth herein.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Assumption of Certain Liabilities. (a) On Upon the terms of and subject to the conditions set forth hereinof this Agreement, Purchaser shall (i) assume at the Closing Buyer shall, or shall cause a Sub-Buyer to, assume and agree to pay, perform and discharge or perform when due the Assumed Liabilities on due, and indemnify Seller from and after the Closing from, such trade payables which are owing and unpaid by any Seller Party as of the Closing and which were incurred by Seller Parties (i) in the ordinary course of business after the Filing Date and (ii) assume all obligations for and pay and discharge when due not in material breach of any provision of O&M Agreement (such trade payables being hereinafter referred to as the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract"Post-Petition Trade Payables"); provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser that Buyer shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating hereunder, and each Seller Party shall remain solely responsible for the payment of, all Post-Petition Trade Payables to the Business or extent that the Purchased Assets that existsaggregate amount thereof exceeds $500,000. To the extent that, or arises out in the reasonable determination of Buyer, the aggregate amount of all Post-Petition Trade Payables outstanding as of the operation or ownership of the Purchased Assets or the BusinessClosing exceeds $500,000, prior toBuyer shall, at or afteron such basis as it deems reasonable, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not determine which Post-Petition Trade Payables it (and/or Sub-Buyers) will assume any Liability of any nature or kind whatsoever of Sellershereunder.
(b) From time Buyer agrees to time perform and discharge, or to cause a Sub-Buyer to perform and discharge, all liabilities and obligations incurred after the date hereofClosing under all Accepted Contracts which, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed upon the approval of the Bankruptcy Court and at the prior written direction of Buyer, are assumed by Buyer pursuant to assume (each, an “Accepted Contract” and, collectively, Section 365 of the “Accepted Contracts”) and Bankruptcy Code or (ii) each Assigned Contract that Purchaser does are not desire assumable by Seller pursuant to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by Bankruptcy Code but the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay parties to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract have, prior to the Closing, consented in writing (on terms at least as favorable as the Contract Determination Date for pre-default contract terms) to the assignment of such Accepted Contract. In furtherance Contract to such Buyer Party (each of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned an "Assumed Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b"). From the date hereof until the Contract Notification DeadlineExcept pursuant to Section 1.3(a), Sellers Buyer Parties shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; providedassume hereunder, that Sellers and each Seller Party shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be remain solely responsible for, the payment and shall pay in accordance with Section 2.7(c)performance of, all costs obligations incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable prior to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each by such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession Seller Party under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contractall Assumed Contracts.
(c) With respect Buyer does not hereby agree to each Assigned Contractperform, Sellers shalldischarge or in any other way be liable for, within 60 days after the later contingently or otherwise, any liabilities or other obligations of (iSeller Parties of whatsoever nature or description and whenever incurred other than as expressly set forth in Section 1.3(a) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (iib) under this Section 2.7above (hereinafter, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline"Excluded Liabilities"). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Sources: Asset Purchase Agreement (Kti Inc)
Assumption of Certain Liabilities. (a) On the terms of and subject to the conditions set forth herein, Purchaser shall (i) and subject to Section 1.4 hereof, from and after the Closing, the Buyer will assume at the Closing and discharge satisfy or perform when due only (i) those liabilities and obligations of the Assumed Liabilities on and Seller arising after the Closing Date under the Leases and the Contracts (other than under those Contracts referred to in subsection (iii) below), (ii) assume all subject to Section 9.2(g) and 9.5, any obligations of the Seller under product warranties for products sold prior to the Closing Date, (iii) those liabilities and pay obligations of the Seller arising after the Closing Date under The Area Lighting Research 401(k) Savings Plan, The Area Lighting Research Employee Health and discharge when due Prescription Drug Plan, Area Lighting Research, Inc. Dental Plan with Allmerica Financial December 16, 1996, and the Cure Amounts relating Area Lighting Research, Inc. Christmas Club and The Area Lighting Research, Inc. Dependent Care and Flexible Spending Account Plan (the "Assumed Plans"), subject to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as terms and conditions set forth in Section 2.7(b)subparagraph (c) below, and (iv) any and all trade payable liabilities and accrued expenses of the Seller incurred in no event shall Purchaser assume the ordinary course of the Seller's business and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth not in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability violation of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership terms of this Agreements and outstanding on the Purchased Assets or Closing Date (the Business, prior to, at or after"Assumed Payables") (collectively, the Closing and that is not an "Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of SellersObligations").
(b) From time to time after The Buyer shall deduct the date hereofamount the amount of the Assumed Payables from the cash portion of the Purchase Price. The Seller shall calculate the amount of the Assumed Payables between January 31, but in no event later than 60 days following the Closing Date or1997 and February 2, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for 1997 and shall pay certify to each applicable Person that is a party the Buyer as to an Accepted Contract the respective Cure Amount for such Accepted Contract amount thereof on February 3, 1997. Notwithstanding anything to the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as contrary set forth in this Section 2.7Agreement, Purchaser’s Carrying Costs the Buyer shall not include assume and shall not be liable for any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 Assumed Payables in excess of the Bankruptcy Code. With respect amount of Assumed Payables certified to each Assigned Contract, between by the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned ContractSeller.
(c) With Effective as of the Closing Date, the Buyer will assume sponsorship of the Assumed Plans. The Seller and Buyer agree to cooperate to transfer the sponsorship of the Assumed Plans as soon as practical and effective as of the Closing. In connection therewith, the Seller shall use its best efforts to cause to be assigned to the Purchaser such policies of insurance or other contracts as the Buyer designates in writing as pertained to the funding of benefits under any of the Assumed Plans, or in case where such assignment is commercially impractical, the Seller shall cooperate in arranging for the issuance of new or modified policies or contracts. The Seller and the Buyer agree to provide assistance and cooperation to each other in the administration of the Assumed Plans and their respective responsibilities with respect to each Assigned Contract, Sellers shall, within 60 days obligations or liabilities under the Assumed Plans before and after the later Closing Date. Notwithstanding the assumption of Assumed Plans by the Buyer, the Seller shall (i) prepare, file and/or distribute to the Contract Determination Date for such Assigned Contract appropriate government agencies and plan participants all Annual Reports (Form 5500 series, including audited financial statements if required), summary annual reports, summary of material modifications, benefit statements and any other reports or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect disclosures required to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time made by applicable law with respect to any Assigned Contract plan year ending on or before the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding thereforClosing Date, and (ii) account for and remit to the Purchaser or the trustee in the event any benefits under this Section 2.7the Assumed Plans are held in trust all contributions, including with respect any employer contributions required to be contributed under the obligation to pay the Cure Amount Assumed Plan and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party employee contributions (whether by virtue of salary reduction agreements or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaserotherwise) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required period ending on or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Assumption of Certain Liabilities. Subject to the further provisions of this Section 1, Buyer hereby assumes all of Seller's liabilities and obligations (collectively, "Liabilities") as of 12:01 a.m. on __________________________, 1998, (the "Effective Time of Closing"), in respect to:
(a) On the terms of and subject to the conditions The Assumed Deposits, as set forth hereinon Schedule 1 attached hereto;
(b) The Leases, Purchaser shall as set forth on Schedule 2 attached hereto;
(ic) assume at the Closing and discharge or perform when due the The Assumed Liabilities Contracts, as set forth on Schedule 3 attached hereto;
(d) Seller's obligations to provide services from and after the Closing Date in connection with the Assets and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval OrderDeposits, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount safe deposit boxes located at the Branch as set forth in the agreements relating to such boxes and their contents;
(e) Accrued Expenses, as set forth on Schedule 4 attached hereto;
(f) Any liabilities or obligations for compliance with any Environmental Law associated with the Real Estate, Real Estate Improvements, Leasehold Improvements or other Assets (subject only to Buyer's right of reimbursement pursuant to Section 6.5(c) of the Acquisition Agreement for Actual Costs as defined in such Ancillary ServicingSection 6.5(c); and
(g) The Other Liabilities, as set forth in Schedule 5 attached hereto. Notwithstanding any provision of this Agreement or the Acquisition Agreement that might be constructed to the contrary, Liabilities do not include any of the Non-Related AgreementAssumed Liabilities or any liabilities with respect to Leases or Assumed Contracts as to which any consents required to transfer the same to Buyer at Closing have not been obtained by Seller Buyer hereby accepts the transfer of all ▇▇▇ Deposits to Buyer, and Buyer accepts appointment as the successor custodian under all ▇▇▇ Deposits.
Appears in 1 contract
Sources: Branch Purchase and Assumption Agreement (Surety Capital Corp /De/)
Assumption of Certain Liabilities. At, and effective as of, the --------------------------------- Closing Date, Buyer shall: accept, assume and pay, when such payment is required to be made under applicable Law, the obligations and liabilities to the Transferred Employees, the Post-Closing Hires and the De-Selected Employees (aall as hereinafter defined) On for accrued vacation as described in Section 1.3(a); and -------------- accept, assume and comply with the terms liabilities and obligations of the Sellers arising under the Subsidiaries' Assigned Contracts and the ▇▇▇▇▇▇▇▇'▇ Assigned Contracts (collectively, the "Assigned Contracts"), unless any such contract ------------------ shall have been excluded from the Purchased Assets in accordance with Section ------- 1.3(b) and, subject to the conditions set forth hereinprovisions of Section 5.13, Purchaser shall HRC's liabilities and ------ ------------ obligations under the Additional Truck Leases (i) assume at the Closing liabilities and discharge or perform when due obligations being assumed by Buyer being collectively referred to herein as the "Assumed ------- Liabilities"). Without limiting the generality of the foregoing, the Assumed ----------- Liabilities on shall include the obligations and liabilities of the respective Sellers under the Assigned Contracts and the Additional Truck Leases, whether existing prior to or after the Closing Date and (ii) assume all Date, including, but not limited to, obligations for and pay and discharge when due to make payments or to take any other actions to cure any defaults on the Cure Amounts relating to each Assigned Contract at part of the respective Contract Determination Date Sellers under the Assigned Contracts under Bankruptcy Code Section 365. Following the Closing, Buyer shall perform and satisfy, and shall be solely responsible for, the Assumed Liabilities, and waives any right to seek reimbursement from the Sellers or their affiliates for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out on account of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed LiabilityLiabilities. Except as set forth in this Section 2.7, other Other than the Assumed Liabilities, Purchaser shall Buyer does not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but and shall in no event later than 60 days following the Closing Date orbe liable for any liabilities, if such date does debts or obligations of any Seller, whether accrued, absolute, matured, contingent or otherwise (and those liabilities which are not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline Assumed Liabilities shall be deemed to be an "Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(bLiabilities"). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.---------------------
Appears in 1 contract
Sources: Asset Purchase Agreement (Matthews Studio Equipment Group)
Assumption of Certain Liabilities. On the Closing Date (as hereinafter defined), Buyer shall, subject to Section 1.4, assume and hereby agrees to pay, perform and discharge, when due, only those debts, liabilities, obligations and commitments of Seller which are set forth below:
(a) On all liabilities of Seller reflected on the terms February 28, 1998 balance sheet contained in the Financial Statements (as defined below) and, without limitation, all liabilities of and subject to Seller reflected on the conditions set forth herein, Purchaser shall balance sheet contained in the Reviewed Financial Statements (i) assume at the Closing and discharge or perform when due the Assumed Liabilities on and after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(bdefined below), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.;
(b) From time to time after the date hereofaccounts payable, but in no event later than 60 days following the Closing Date oraccrued expenses and other liabilities as listed on Schedule 1.2, if such date does not fall on a Business Dayincluding, the next succeeding Business Day (the “Contract Notification Deadline”)without limitation, Purchaser shallaccrued salaries, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) wages and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall vacation pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract Transferred Employees (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.hereinafter defined);
(c) With respect to each Assigned Contractdebts, Sellers shallliabilities, within 60 days after obligations and commitments arising under the later of Real Property Leases (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadlineincluding, advise Purchaser in writing of the amount of the Carrying Costs without limitation, accrued real estate taxes not yet due and payable with respect to such Assigned Contract in sufficiently reasonable detail; providedthe Real Property Leases), thatPermits, without limiting Personal Property Leases and the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect Contracts transferred to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.Buyer;
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry indebtedness owing and other obligations of Seller to Bank One, Milwaukee, N.A. in an Order of the Bankruptcy Court (the “Supplemental Order”) amount not to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.exceed $2,848,003;
(e) Prior all of Seller's obligations to NCH Promotional Services ("NCH") arising from NCH's services with respect to product coupons;
(f) all of Seller's obligations listed on Schedule 1.2 under open purchase orders with respect to co-packers;
(g) any liabilities of Seller under collective bargaining agreements pertaining to employees of Seller; any liabilities of Seller to pay severance benefits to employees of Seller whose employment is terminated in connection with or following the sale of the Property pursuant to the provisions hereof (except to the extent any such liability is expressly retained by Seller under Sections 1.4 and 5.7); any liability in connection with Buyer's offers of employment to former employees of Seller; or any liability under any Federal or state civil rights or similar law, or the Workers Adjustment and Retraining Notification Act, 29 U.S.C. Sec. 2101 et seq. (the so-called "WARN Act"), resulting from the termination of employment of employees; and
(h) all other liabilities of Seller (whether known or unknown, whether absolute or contingent, whether liquidated or unliquidated, and whether due or to become due), incurred by Seller in the ordinary course of the Business as of the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry . The liabilities of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been Seller being assumed by Sellers and assigned Buyer are hereinafter collectively referred to Purchaser by agreement of as the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement"Assumed Liabilities."
Appears in 1 contract
Sources: Asset Purchase Agreement (Delicious Frookie Co Inc /De/)
Assumption of Certain Liabilities. Purchaser shall assume and agrees to pay, perform and discharge when due, and to indemnify and hold Seller harmless from, only the following liabilities and obligations of Seller (a) On individually, an "Assumed Liability" or collectively, the terms "Liabilities"), and no other liabilities of Seller, which relate to and subject arise during the period subsequent to the conditions set forth herein, Purchaser shall Closing:
(i) assume at All liabilities and obligations of Seller arising from or under Seller's accounts payable listed on Schedule 4.1(i) attached hereto;
(ii) All liabilities and obligations of Seller arising from or under the Closing equipment leases identified on Schedule 4.1(ii) attached hereto, including postage meter;
(iii) All liabilities and discharge obligations of Seller arising from or perform when due under the Contracts, the Other Contracts and the Intellectual Property;
(iv) All liabilities and obligations of Seller arising from or under all written agreements, leases and licenses, existing and holdover, held by Seller for the use of real estate on which the Business is operated, including those described on Schedule 4.1(iv) (the "Leases"); and
(v) All liabilities and obligations of Seller arising from or under the software leases listed on Schedule 4.1(v) attached hereto.
(vi) Unknown product warranty claims. Purchaser and Seller agree that the Assumed Liabilities shall not exceed $438,888.20 (which is $452,666.20 less $13,786.00). The parties agree that for purposes of determining whether the Assumed Liabilities exceed this dollar limit, amounts which may be due for periods on and or after the Closing Date and (ii) assume all obligations for and pay and discharge when due under various contracts of Seller that are assumed by the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
be taken into account (b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, thatexample, without limiting the foregoing, Sellersrent under the Seller's Lease for periods on or after the Closing Date shall not be counted as part of the dollar cap in this section). To the extent that Purchaser may satisfy the Assumed Liabilities by payment of less than $438,880.20 (either because the Assumed Liabilities on Seller's books and records do not aggregate that amount, or because the holder of such liabilities are willing to accept lesser amounts, or for any other reason), then Purchaser agrees to assume so much of the Seller's Excluded Liabilities as is equal to the difference between $438,880.20 and the amount actually paid by Purchaser to satisfy the Assumed Liabilities. Seller shall designate which of its Excluded Liabilities shall be paid pursuant to this paragraph. (To illustrate the foregoing, if Purchaser is able to satisfy the Assumed Liabilities in their sole discretionfull by payment of an aggregate $338,880.20, may advise then Purchaser in writing will agree to assume an additional $100,000 of Seller's Excluded Liabilities.) Purchaser shall make its books and records relating to the Assumed Liabilities available for inspection by the Seller from time to time after the Closing on reasonable advance notice to verify the amount of Carrying Costs at any time payment made by Purchaser with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the partiesAssumed Liabilities.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Assumption of Certain Liabilities. (a) On Upon the terms of and subject to the conditions set forth hereinof this Agreement, at the Closing, Purchaser shall agrees to assume, pay, perform and discharge when due, all liabilities or obligations listed in this Section 2.2, and only such liabilities or obligations listed in this Section 2.2, whether arising before or after the Closing and whether known or unknown, fixed or contingent (the "Assumed Liabilities"):
(i) assume at All liabilities set forth on the Closing summary adjusted balance sheet and discharge income statement of the Company as of December 31, 1998, a copy of which is included as Exhibit 2.2 (the "Adjusted December 31, 1998 Balance Sheet") or perform when due arising thereafter in the Assumed Liabilities on and after the Closing Date and ordinary course of business; and
(ii) assume all obligations liabilities for and pay and discharge when due payment or performance under the Cure Amounts relating to each Assigned Contract at terms of the respective Contract Determination Date for such Assigned Contract; provided, thatCommitments, except as set forth in Commitments excluded pursuant to Section 2.7(b10.3(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time Notwithstanding anything herein to time after the date hereof, but in no event later than 60 days following contrary or any other writing to the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”)contrary, Purchaser shallshall assume only the Assumed Liabilities, and neither Purchaser nor any of its Affiliates shall assume any other liability or obligation of the Sellers (or any predecessor owner of all or part of the Business) of whatever nature whether presently in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) existence or arising hereafter. All such other liabilities and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline obligations shall be deemed retained by and remain obligations of the Sellers (or any such predecessor owner) (all such liabilities and obligations not being assumed being herein referred to be an as the "Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded ContractLiabilities"). Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract Without limiting the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance generality of the foregoing, the Sale Approval Order Excluded Liabilities shall provide that include the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.following:
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations which are attributable to any of the Excluded Assets, or associated with respect the realization of the benefits of any of the Excluded Assets;
(ii) all Tax liabilities (excluding the Permitted Encumbrances);
(iii) all liabilities and obligations relating to compensation and any pension, deferred compensation, vacation, medical benefit, life insurance, severance or other employee health or safety matters and any other employee benefit plans, programs or arrangements associated with or relating to the Cure Amount employment in the Business, prior to the Closing, of any employee or former employee (including, but not limited to, all Employee Benefit Plans) and all liabilities and obligations relating to or arising from the employment or cessation of employment of any such Ancillary Servicingemployee prior to the Closing, except to the extent that such liabilities are accrued on the Closing Date Balance Sheet;
(iv) all liabilities and obligations arising from worker's compensation claims relating to pre-Related AgreementClosing events;
(v) all liabilities and obligations covered, but only to the extent covered, by any insurance maintained by the Sellers or any of their respective Affiliates;
(vi) Commitments excluded pursuant to Section 10.3(b);
(vii) all liabilities and obligations arising from the suits, claims and actions described on Exhibit 5.19; and
(viii) all other liabilities and obligations of the Sellers to the extent not relating to the Business.
Appears in 1 contract
Sources: Asset Purchase Agreement (Standard Automotive Corp)
Assumption of Certain Liabilities. (a) On Upon the terms of and subject to the conditions set forth hereinof this Agreement, Purchaser shall (i) assume at assume, effective as of the Closing Closing, and discharge or perform when due the Assumed Liabilities on from and after the Closing Purchaser shall pay, perform and discharge when due, all the following liabilities, obligations and commitments of Seller and Seller Sub (the "ASSUMED LIABILITIES"):
(i) any liability, obligation or commitment relating to or arising out of the Business or any Acquired Asset, whether express or implied, liquidated, absolute, accrued, contingent or otherwise, or known or unknown, and based upon, arising out of or resulting from any fact, circumstance, occurrence, condition, act or omission occurring after the Closing Date and , but not based on, arising out of or resulting from any fact, circumstance, occurrence, condition, act or omission existing on or occurring on or prior to the Closing Date;
(ii) assume all liabilities, obligations for and pay and discharge when due commitments of Seller or Seller Sub under the Cure Amounts relating Assigned Contracts arising after the Closing Date, except obligations, liabilities or obligations arising out of any actual or alleged breach on or prior to each Assigned Contract at the respective Contract Determination Closing Date for such by Seller or Seller Sub of, or nonperformance on or prior to the Closing Date by Seller or Seller Sub under, any Assigned Contract; providedand
(iii) all accounts payable and accrued expenses of Seller or Seller Sub arising out of the operation or conduct of the Business on or prior to the Closing Date, that, except but only to the extent included in Closing Working Capital.
(b) Except as set forth in Section 2.7(b1.03(a), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in notwithstanding any other provision of this Section 2.7Agreement or any Ancillary Agreement, Purchaser shall not assume any liabilities, obligations and commitments of Seller and Seller Sub (the "EXCLUDED LIABILITIES"), all of which shall be retained and paid, performed and discharged when due by Seller and Seller Sub, including:
(i) any liability, obligation or have commitment of Seller or Seller Sub not specifically listed in Section 1.03(a);
(ii) any Liability liability, obligation or responsibility with respect to any Liability commitment of any nature Seller or kind whatsoever Seller Sub, except as specifically set forth in Section 1.03(a), relating to or arising out of the Business or the Purchased Assets that existsany Acquired Asset, whether express or implied, liquidated, absolute, accrued, contingent or otherwise, or arises known or unknown, and based upon, arising out of or resulting from any fact, circumstance, occurrence, condition, act or omission existing on or occurring on or prior to the Closing Date;
(iii) any liability, obligation or commitment of Seller or Seller Sub, whether express or implied, liquidated, absolute, accrued, contingent or otherwise, or known or unknown, arising primarily out of the operation or ownership conduct by Seller or any of its affiliates of any business other than the Business;
(iv) any liability, obligation or commitment of Seller or Seller Sub arising primarily out of any actual or alleged breach by Seller or Seller Sub of, or nonperformance by Seller or Seller Sub under, any Contract (including any Assigned Contract) on or prior to the Closing;
(v) any liability, obligation or commitment of Seller or Seller Sub arising primarily out of (A) any claim, suit, action or proceeding ("PROCEEDING") pending or, to the knowledge of Seller or Seller Sub, threatened as of the Purchased Closing Date or (B) any actual or alleged violation by Seller or any of its affiliates of any Applicable Law on or prior to the Closing;
(vi) any account payable or accrued expense of Seller or Seller Sub to the extent not included in Closing Working Capital and any indebtedness for borrowed money or guarantees thereof;
(vii) any liability, obligation or commitment of Seller or Seller Sub to the extent it relates to, or that arises out of, any Excluded Asset, or that arises out of the distribution to, or ownership by, Seller or Seller Sub of the Excluded Assets or associated with the realization of the benefits of any Excluded Asset;
(viii) any liability, obligation or commitment for Taxes, whether or not accrued, assessed or currently due and payable, (A) of Seller or Seller Sub (including any and all income Taxes of each of Seller and Seller Sub), or for which either of Seller and Seller Sub is liable, under Treasury Regulation section 1.1502-6, as a transferee, by contract, or otherwise, or (B) levied with respect to the Acquired Assets for the Pre-Closing Tax Period as provided in Section 5.18(b) and in any case which have not been explicitly assumed by Purchaser pursuant to this Agreement;
(ix) except as expressly provided in Section 5.09, any liability, obligation or commitment of Seller or Seller Sub arising under any Seller Benefit Plan;
(x) any liability, obligation or commitment arising under any Environmental Law in respect of the Acquired Assets or Business, to the extent arising out of conditions existing or events occurring on or prior to the Closing Date;
(xi) any liability, obligation or commitment of Seller or Seller Sub that relates to, at or afterthat arises out of, services performed or products manufactured, shipped or sold by or on behalf of Seller or Seller Sub on or prior to the Closing Date (including claims of negligence, personal injury, product damage, product liability, product warranties, promotional obligations, strict liability, product recall or any other claims (including workers' compensation, employer's liability or otherwise)), whether such liability, obligation or commitment relates to or arises out of accidents, injuries or losses occurring on or prior to the Closing Date;
(xii) any liability, obligation or commitment of Seller or Seller Sub that relates to, or that arises out of, the termination of the employment with Seller or Seller Sub of any Business Employee, former Business Employee or service provider of the Business (including as a result of the transactions contemplated by this Agreement) or the service of any employee or consultant with Seller or Seller Sub on or prior to the Closing Date, including any salary, severance, bonuses, vacation, stock options or other employee benefits, rights or obligations under any Seller Benefit Plan, except to the extent expressly provided otherwise in Section 5.09; and
(xiii) any liability, obligation or commitment of Seller or Seller Sub to any of their respective affiliates.
(c) Purchaser shall acquire the Acquired Assets free and that is not an Assumed Liability. Except as set forth in this Section 2.7clear of all liabilities, obligations and commitments of Seller or Seller Sub, other than the Assumed Liabilities, Purchaser shall not assume any Liability and free and clear of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereofall Liens, but in no event later other than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the partiesPermitted Liens.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order Seller and Purchaser acknowledge that certain expenses of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectivelyBusiness are paid on a periodic basis. Accordingly, the “Additional Contracts”) thatitems listed below, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Orderextent not included in Closing Working Capital, shall be apportioned between Seller and Seller Sub and Purchaser, with the same effect as if Seller and Seller Sub being responsible for all such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect expenses attributable to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be periods on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior prior to the Closing Date, Sellers shall file a Supplemental Motion with and Purchaser being responsible for all expenses attributable to periods after the Bankruptcy Court for entry Closing Date:
(i) prepaid rent, tenant utility payments and all other percentage or additional rent, common area maintenance and sundry charges (including any HVAC charges) and commissions paid by tenants;
(ii) utility company charges, including electricity, gas, fuel, water and sewer charges;
(iii) general and special assessments and other public or private charges affecting the Leased Property; and
(iv) other items typically apportioned in sale of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement assets transactions of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related type contemplated by this Agreement.
Appears in 1 contract
Assumption of Certain Liabilities. Buyer will assume, pay and perform only the following obligations and liabilities of Seller arising in connection with the Film Assets: (a) On the terms outstanding principal and interest as of and subject to the conditions set forth herein, Purchaser shall (i) assume at the Closing and discharge or perform when due the Assumed Liabilities on and after the Closing Date and (ii) assume all obligations for and pay and discharge when due on the Cure Amounts relating loans owed to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts Buyer or any Affiliate of Buyer relating to the Excluded Contracts. Except motion pictures "Color of Night", "Scarlet Letter", "▇▇▇▇▇", "Evita" and "Shadow Conspiracy" (the "DISNEY LOANS"); (b) the outstanding principal and interest as set forth in this Section 2.7of the Closing Date under the Credit, Purchaser Security, Pledge and Guaranty Agreement dated as of August 16, 1994, between Cinergi Productions N.V. Inc. and The Chase Manhattan Bank, as Agent ("CHASE") (the "CHASE CREDIT AGREEMENT") up to a maximum amount of Ten Million Dollars ($10,000,000) to the extent and only to the extent such outstanding principal and interest under the Chase Credit Agreement is directly attributable to Seller's payment of production costs for the Picture presently entitled "An ▇▇▇▇ ▇▇▇▇▇▇▇ Film", which production costs shall not assume or have any Liability or responsibility include financing costs and interest solely attributable to loans under the Chase Credit Agreement for the Picture presently entitled "An ▇▇▇▇ ▇▇▇▇▇▇▇ Film"; (c) all Guild Obligations and Participation Obligations relating to the Pictures; provided that Buyer's Participation Obligations with respect to any Liability the motion picture entitled "Die Hard III" shall be limited to Buyer's and/or Buyer's Affiliate's Pro Rata Share of any nature the Participation Obligations arising only from Buyer's or kind whatsoever relating Buyer's Affiliate's exercise of Buyer's or Buyer's Affiliate's rights under the BVI Die Hard Distribution Agreement as described in Section 2.13 below, and Buyer's Guild Obligations with respect to the Business motion picture entitled "Die Hard III" shall be limited to the Guild Obligations arising from Buyer's or Buyer's Affiliate's exploitation of its rights under the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) BVI Die Hard Distribution Agreement; and (iid) each Assigned Contract those certain obligations pursuant to Existing Exploitation Agreements that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed are to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract performed in accordance with the terms of this Section 2.7(b)such Existing Exploitation Agreements on or after the Closing Date, but only if such obligations are specifically listed on SCHEDULE 2.1 attached hereto. From the date hereof until the Contract Notification Deadline, Sellers Buyer shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers assume and shall not be deemed liable for any other liabilities or obligations except as expressly set forth in breach under this Agreement the preceding sentence, including without limitation the following excluded liabilities (whether as a result collectively, the "EXCLUDED LIABILITIES"): (1) any claims against Seller or any obligations or liabilities of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible forSeller (including, and shall pay in accordance with Section 2.7(c)without limitation, all costs incurred by Sellers with respect toclaims, obligations and all amounts due by liabilities relating to the claims described on SCHEDULE 3.14 attached hereto) which arise from facts, circumstances, conditions, actions or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable failures to each such Assigned Contract (the “Carrying Costs”) during the period from take actions existing or occurring prior to the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7regardless of whether any suit, Purchaser’s Carrying Costs shall not include any attorneys’ claim or financial advisory fees arising from and directly proceeding related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior thereto was commenced prior to the Closing Date, Sellers shall file a Supplemental Motion with other than the Bankruptcy Court for entry liabilities assumed in (a), (b) or (c) above; (2) any claims against Seller or Seller's Affiliates or any obligations or liabilities of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect Seller or Seller's Affiliates arising from or related to the Cure Amount relating ▇▇▇▇▇ ▇▇▇▇▇▇ Bros. Soundtrack Rights or arising under the ▇▇▇▇▇ ▇▇▇▇▇▇ Bros. Soundtrack Agreement, in either case, whether or not such obligations and liabilities arise before or after the Closing Date; and (3) any obligations or liabilities to any the shareholders of Seller, in their capacities as shareholders, whether or not such Ancillary Servicing-Related Agreementobligations and liabilities arise before or after the Closing Date.
Appears in 1 contract
Sources: Purchase and Sale Agreement (Cinergi Pictures Entertainment Inc)
Assumption of Certain Liabilities. (a) Buyer shall not assume any Liabilities of Seller except for those Liabilities which Buyer expressly assumes pursuant to this Section 0. On the terms of and subject to the conditions set forth hereinof this Agreement, Purchaser shall (i) assume at Buyer shall, on the Closing and discharge or perform when due the Assumed Date, only assume those Liabilities on and after of Seller, if any, as of the Closing Date Date, which are detailed on Schedule 2.2(a) (the “Assumed Liabilities”). Seller shall retain and (ii) assume all obligations be responsible for paying, performing and pay discharging when due, and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser Buyer shall not assume or have any Liability responsibility for, any Liabilities of Seller as of the Closing Date other than the Assumed Liabilities (such Liabilities, other than the Assumed Liabilities being referred to herein as “Retained Liabilities”). Without limiting the generality of the foregoing, the retained liabilities shall include, without limitation, all of the following Liabilities: (i) any claims or responsibility with respect to any Liability Liabilities of any nature or kind whatsoever relating creditors of Seller that do not relate to the Business or the Purchased Assets that existsAssets; (ii) any Taxes of Seller for any taxable period, including any liability for Taxes arising from or arises out attributable to the operation of the operation Business or use or ownership of the Purchased Assets for any taxable periods (or the Business, portions thereof) ending on or prior to, at or after, to the Closing Date (the “Pre-Closing Tax Period”), and that including any Transfer Taxes (as such term is not an Assumed Liability. Except as set forth defined in Section 0), in each case alllocable to Seller pursuant to this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume Agreement; (iii) any Liability of any nature Seller relating to or kind whatsoever arising out of Sellers.
(b) From time to time after the date hereof, but or incurred in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under connection with this Agreement and the transactions contemplated hereby and thereby, including transaction related costs and expenses; (whether as a result of an inaccuracy in a representation or warranty or breach of a covenantiv) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection Liability under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expensethat arises out of or relates to a breach of, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, default under that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser ; (v) all Employee Liabilities; (vi) any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement Liability of the parties thereto in accordance with the terms Seller to any Affiliate of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect Seller or other related Person of the Seller; (vii) any Liability to the Cure Amount relating indemnify, reimburse or advance any amounts to any such Ancillary ServicingEmployee or to any officer, director or agent of the Seller; (viii) any Liability to distribute to any of the Seller’s shareholders or otherwise apply all or any part of the consideration received by the Seller under this Agreement; (ix) any Liability in respect of leased premises of Seller commonly known as 7▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ or any other leased premises used by Seller in the Business; (x) any Liability in respect of any inter-Related Agreementcompany debt, loans or similar agreements or arrangements between the Seller and any of its Affiliates; and (xi) any Liability arising out of or resulting from the Seller’s compliance or non-compliance with any applicable law.
Appears in 1 contract
Assumption of Certain Liabilities. (a) On At the terms Closing, Buyer will assume only the following liabilities of and subject to the conditions set forth herein, Purchaser shall (i) assume at the Closing and discharge or perform when due the Assumed Liabilities on and after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts Seller relating to the Excluded ContractsBusiness (the "Assumed Liabilities"). Except as set forth specifically described in this Section 2.71.3, Purchaser Buyer shall not assume any liability or have obligation of Seller whatsoever, whether or not any Liability such liability or responsibility with respect to any Liability of any nature or kind whatsoever relating obligation pertains to the Business or the Purchased Assets Assets.
1.3.1. Buyer shall assume all payment or performance obligations and related liabilities that existsarise after the Closing (without giving effect to the consequences of any breach by Seller) under all instruments, contracts and agreements assigned to Buyer under Section 1.1 or arises out Section 1.2.5.
1.3.2. Buyer shall assume only such expenses relating to promoting and marketing the Business ("Promotional Expense") and such prepayments relating to concession agreements ("Prepaid Concession Expense") as are incurred in compliance with the following procedure. Seller will not incur any Promotional Expense or Prepaid Concession Expense without the consent of Amin ▇▇▇▇▇▇ ("▇hou▇▇") ▇r Davi▇ ▇▇▇▇▇ ("Lahar"), which consent shall not be unreasonably withheld. In the operation event Khou▇▇ ▇▇ Laha▇ ▇▇▇sents to such Promotional Expense or ownership Prepaid Concession Expense, Buyer will assume the cost of the Purchased Assets such Promotional Expense or the Business, prior to, Prepaid Concession Expense at or after, the Closing and will pay all such expenses (to the extent previously paid by Seller) as additional Cash Purchase Price at the Closing. If Seller incurs a Promotional Expense or Prepaid Concession Expense without the consent of Khou▇▇ ▇▇ Lahar, Seller will be responsible for paying such Promotional Expense or Prepaid Concession Expense. Buyer will at the Closing assume the cost of and pay (to the extent previously paid by Seller) as additional Cash Purchase Price at the Closing all Promotional Expenses and Prepaid Concession Expenses between March 4, 1997 10 and the Closing Date that is are reasonably necessary to maintain the value of the Business as a going concern, so long as Khou▇▇ ▇▇ Laha▇ consents to such Promotional Expenses or Prepaid Concession Expenses, which consent shall not an be unreasonably withheld. Liabilities for accrued but unpaid Promotional Expenses and Prepaid Concession Expenses so consented to by Khou▇▇ ▇▇ Lahar will be included in the Assumed LiabilityLiabilities. Except as set forth In no event shall Seller's obligation to incur Promotional Expenses from March 4, 1997 to the Closing Date exceed $67,000 in this Section 2.7, the aggregate nor extend to matters other than the Assumed LiabilitiesDisney production film, Purchaser shall not assume any Liability ESPN local ad spot, Golf Channel spot, long drive contest and Nitro express printing and mailing the details of any nature or kind whatsoever of Sellers.
(b) From time which have been provided by Seller to time after the date hereof, but in Buyer. In no event later shall Seller's obligation to incur Prepaid Concession Expenses (other than 60 days following Prepaid Concession Expenses in the amounts of $1,375 in favor of Arizona Golf Resort, $1,466 in favor of Palm Brook Country Club, $7,791 in favor of the Phoenician Resort, and $2,108 in favor of Lago Mar Country Club, which are hereby consented to) from March 4, 1997 to the Closing Date exceed $10,000 in the aggregate. In the event that the Closing shall not have occurred on or before April 30, 1997, Buyer shall promptly pay to Seller the amount of Prepaid Concession Expenses described in the parenthetical clause in the previous sentence and the amount of all Promotional Expenses and Prepaid Concession Expenses incurred after March 4, 1997 and before April 30, 1997 (or, if such date does not fall on a Business Dayearlier, the next succeeding Business Day (date of termination of this Agreement) that Khou▇▇ ▇▇ Laha▇ ▇▇▇roved, except where Seller has failed to fulfill its obligations hereunder and the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers termination of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation results solely from such failure.
1.3.3. Buyer shall assume all payment or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for performance obligations and shall pay related liabilities with respect to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance operation of the foregoingNitro trade show booth.
1.3.4. Buyer shall assume all payment or performance obligations and related liabilities that arise, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) occur or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business dated after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provideddeductions, thatoff-sets, without limiting chargebacks, price protection provisions, cooperative advertising allowances or other reductions or dilutions that arise, occur or are dated after the Closing Date or that pertain to returns of products of a type constituting Purchased Assets to Buyer or Seller after the Closing. Notwithstanding the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing Buyer will not assume any such obligation or liability resulting from a legal obligation of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior arising prior to the Closing Date, Sellers shall file that either is a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements verbal obligation or liability that have not otherwise been is disclosed in Schedule 1.3.4 or is evidenced in writing (other than such obligations expressly assumed by Sellers and assigned Buyer pursuant to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related AgreementSection 1.3 or Schedule 1.3.
Appears in 1 contract
Sources: Asset Acquisition Agreement (Sport Supply Group Inc Et Al)
Assumption of Certain Liabilities. (a) On the terms of and subject to the conditions set forth hereinherein and in the Sale Order, effective as of the Closing, in addition to the payment of the Cash Payment in accordance with Section 2.1, Purchaser shall irrevocably assume from each Seller (ior with respect to Taxes, if applicable, from such Seller’s applicable Affiliate) assume at the Closing and discharge or perform when due the Assumed Liabilities on (and after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the pay, perform, discharge, or otherwise satisfy in accordance with their respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(bterms), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume Sellers (or have any Liability or responsibility with respect to any Liability Taxes, if applicable, from such Seller’s applicable Affiliate) shall irrevocably transfer, assign, convey, and deliver to Purchaser, only the following Liabilities (and no other Liabilities, which other Liabilities shall be retained by Sellers), without duplication and only to the extent not paid, performed, discharged or otherwise satisfied on or prior to the Closing (collectively, the “Assumed Liabilities”):
(a) all Cure Costs in an amount not to exceed $1,400,000 (the “Assumed Cure Costs”);
(b) all Liabilities and obligations of any nature or kind whatsoever relating Seller under the Assigned Contracts and any Acquired Lease solely to the extent first arising after the Closing and, for the avoidance of doubt, excluding any Excluded Rebate Liability;
(c) all Liabilities arising out of the conduct of the Business or the Purchased Assets that exists, ownership or arises out operation of the operation or ownership of the Purchased Acquired Assets or the Business, prior toin each case, at by Purchaser on or after, after the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.Date;
(bd) From time all trade payables of Sellers to time after non-Affiliated third parties in connection with the date hereof, but in no event later than 60 days following Business existing on the Closing Date or, if such date does that remain unpaid and are not fall on a Business Day, delinquent as of the next succeeding Business Day (Closing Date and incurred in the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Ordinary Course and other Liabilities of Sellers of the types included in the definition of Closing Working Capital but not including any Excluded Rebate Liability or any Liabilities to the extent relating to or otherwise arising, whether before, on or after the Closing, under any of the Excluded Contracts (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted ContractsAssumed Current Liabilities”;
(e) and (ii) each all recoupment obligations of any Seller under any Assigned Contract that Purchaser does not desire Contracts or Excluded Contracts solely to assume (eachthe extent related to claims by any pharmaceutical drug manufacturer or Group Purchasing Organizations pursuant to any Assigned Contract, an “or Excluded Contract” and, for the recoupment of any Rebate Assets (collectively, the “Excluded ContractsAssumed Rebate Liability”); provided, that but excluding any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed Liabilities related to be an Excluded Contract; any billed and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly unbilled manufacture rebate receivable related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 business of the Bankruptcy Code. With EIC;
(f) without duplication: (i) all Liabilities for Taxes with respect to each Assigned Contractthe Acquired Assets, between the Closing Date and such Assigned Contract’s respective Contract Determination DateBusiness, Sellers shall provide, to or the extent reasonably necessary Transferred Employees for Purchaser to operate the Business any taxable period (or portion thereof) beginning after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding thereforDate, and (ii) under this all Transfer Taxes pursuant to Section 2.7, including with respect 9.1;
(g) all Liabilities relating to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, Transferred Employees that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days arise after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain ; and
(h) all liabilities and obligations with respect Liabilities relating to the Cure Amount relating to any such Ancillary Servicing-Related Agreementtermination of Scheduled Employees who do not receive a Transfer Offer from Purchaser in compliance with Section 6.3(a).
Appears in 1 contract
Assumption of Certain Liabilities. (a) On Upon the terms of ---------------------------------- and subject to the conditions set forth hereinof this Agreement, Purchaser or a Purchaser Designee shall assume, effective as of the Closing, and from and after the Closing Purchaser or a Purchaser Designee shall pay, perform and discharge when due, all the following Liabilities of Lyondell and the Lyondell Selling Subsidiaries (the "Assumed Liabilities"), other than any Excluded Liabilities: -------------------
(i) assume at all Liabilities of Lyondell or the Lyondell Selling Subsidiaries under the Assigned Contracts to the extent such Liabilities relate to or arise in the period from and after the Closing;
(ii) all accounts payable and other accrued liabilities of Lyondell or the Lyondell Selling Subsidiaries arising primarily out of the operation or conduct or ownership of the Polyols Business prior to the Closing, but only to the extent they are included in the Closing Working Capital Statement;
(iii) all other Liabilities arising from the operation or conduct or ownership of the Polyols Business by Purchaser or any Purchaser Affiliate from and discharge after the Closing;
(iv) any Liability arising under or perform when due relating to Environmental Laws, which Liability arises from the Assumed operation or conduct or ownership of the Polyols Business by Purchaser or any Purchaser Affiliate after the Closing; and
(v) any of the following Liabilities to the extent unpaid and then only to the extent such Liabilities arise on and or after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises arise out of the operation or conduct or ownership of the Purchased Assets Polyols Business on or the Business, prior to, at or after, after the Closing Date:
(i) rent, tenant utility payments, common area maintenance and that is not an Assumed Liability. Except sundry charges (including any HVAC charges); and
(ii) utility company charges, including electricity, gas, fuel, water and sewer charges;
(vi) any Liabilities for price, volume or other product rebate accruals, but only to the extent they are included in the Closing Working Capital Statement;
(vii) the Liabilities imposed on Purchaser or any Purchaser Affiliate under Applicable Law and the Liabilities assumed by Purchaser or any Affiliate of Purchaser as set forth provided in Section 4.08(f) in respect of Foreign Plans;
(viii) all Liabilities specifically assumed by Purchaser or any Purchaser Designee pursuant to the provisions of this Agreement or any Polyols Transfer Document; and
(ix) the Liabilities identified on Schedule 1.03(a)(ix).
(b) Notwithstanding Section 2.7, other than the Assumed Liabilities1.03(a), Purchaser shall not assume any Liability Excluded Liability, each of any nature or kind whatsoever which shall be retained and paid, performed and discharged when due by Lyondell and the Lyondell Selling Subsidiaries, unless and to the extent being contested in good faith. For the avoidance of Sellers.
(b) From time to time after the date hereofdoubt, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); except as provided, that any Assigned Contract that has this Section 1.03(b) is not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed intended to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach limit Purchaser's other obligations under this Agreement or any other Transaction Document (whether as a result for example, pursuant to Section 6.02 of an inaccuracy in a representation this Agreement or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance Section 4.04 of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification DeadlineMaster Transaction Agreement). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.term "Excluded Liability" means: ------------------
Appears in 1 contract
Sources: Master Asset and Stock Purchase Agreement (Lyondell Chemical Co)
Assumption of Certain Liabilities. a. Notwithstanding anything contained in this Agreement or in any Exhibit to the contrary, Buyer is not and shall not assume any liabilities of the Business or of the Seller, except for the following liabilities of the Seller pertaining solely to the operation of the Business after the Closing Date (athe “Assumed Liabilities”):
i. The obligations of Seller and related payment requirements from and after the Closing Date under the unexpired facility leases for the office of Seller as set forth on the Schedule of Lease Obligations attached hereto as Exhibit 5-A1.
ii. The obligations of Seller and related payment requirements from and after the Closing Date under any equipment lease, lease/purchase or maintenance agreements for those items of office equipment to be purchased by Buyer pursuant to this Agreement, as set forth on the Schedule of Equipment Leases attached hereto as Exhibit 5-A2.
iii. The obligation to pay the Buyer’s customary and normal commissions with respect to mortgage transactions which are pending at the time of Closing and which are finalized within a reasonable period of time following Closing.
b. Notwithstanding anything contained in this Agreement or in any Exhibit to the contrary, Buyer does not assume any liability not being identified herein as being assumed by Buyer, and in particular (by way of illustration and not limitation) On Buyer does not assume any of the terms following liabilities, which liabilities will remain the obligations of Seller (such liabilities are herein collectively referred to as the “Excluded Liabilities”):
i. Any and all trade payables outstanding, accrued to, or due as of the Closing Date.
ii. Any and all accrued salaries, overtime pay, vacation pay, holiday pay, accrued time off pay of any type, expenses and other employee compensation for both temporary and permanent employees of Seller payable up to the Closing Date unless otherwise assumed hereunder.
iii. FICA, withholding, and other payroll related taxes payable up to the Closing Date for any and all periods prior to the Closing Date.
iv. Sales tax obligations for any and all services rendered prior to the Closing Date.
v. Other taxes, fees and assessments payable by Seller or accrued as of the Closing Date.
vi. Audit or other similar adjustments, including any penalties or fines, related to FICA and other payroll taxes, sales taxes, retirement plan contributions, workers’ compensation insurance and similar expenses subject to audits and adjustments for occurrences and time periods prior to the conditions set forth hereinClosing Date.
vii. Federal and state taxes on income earned by Seller prior to the Closing Date and accrued to or payable as of the Closing Date.
viii. Revolving credit line obligations or other short term bank borrowings, Purchaser long term bank loans or installment payment debts of Seller.
ix. Notes and other financial instruments payable by Seller.
x. Any and all notes payable, advances, deferred compensation or other debts owed to Shareholders, or any other employee of, or contractor to, Seller, including any payments related to compensation, vacation pay, sick pay, fringe benefits, or reimbursable expenses related to the employment of, or services performed by, any of such individuals prior to the Closing Date.
xi. Any and all other liabilities of Seller existing as of the Closing Date and not specifically listed as being assumed by Buyer in Section 5a of this Agreement.
xii. Any contingent or unstated liabilities of Seller including, but not limited to, liabilities occurring as a result of legal actions, suits or other claims and resulting from actions or other occurrences which took place prior to the Closing Date.
c. All of the Assets shall be free of any liens, claims, liabilities, charges, restrictions, royalties, fees or other encumbrances other than (i) assume at the Closing liens for Taxes which are not due and discharge or perform when due the Assumed Liabilities on and after payable as of the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall encumbrances which would not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to a material adverse effect on the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded ContractsPermitted Encumbrances”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the No later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers the Seller shall file a Supplemental Motion with secure written releases for the Bankruptcy Court for entry Assets acquired from the holder of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement lien, security interest or other obligation of the parties thereto in accordance with the terms Seller related to any lien, security interest or other encumbrance attaching to all or any category of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreementassets of Seller.
Appears in 1 contract
Sources: Agreement for Sale and Purchase of Assets (Local Telecom Systems Inc)
Assumption of Certain Liabilities. Seller shall assume liability effective as of the Closing Date of certain Liabilities of Company relating to those certain Third-Party Claims listed on Schedule 3.4 (a) On the terms “Specified Litigation”), whether such Specified Litigation arises from Third-Party Claims made before or after the Closing Date. If applicable, any Losses incurred by Purchaser or the Company arising from the Specified Litigation shall be handled in accordance with Article VIII. Seller shall defend, with counsel reasonably satisfactory to Purchaser, at the sole cost and expense of and subject Seller, all Specified Litigation by all appropriate proceedings, which proceedings will be diligently prosecuted or defended by Seller to a final conclusion or will be settled at the conditions set forth herein, discretion of Seller (but only with the prior written consent of Purchaser shall in its sole discretion in the case of any settlement (i) assume at that provides for any relief other than the Closing and discharge or perform when due the Assumed Liabilities on and after the Closing Date and payment of monetary damages, (ii) assume that provides for the payment of monetary damages by Purchaser or its Affiliates, (iii) that does not expressly unconditionally release Purchaser from all Liabilities with respect to such claim and all other claims arising out of the same or similar facts and circumstances, with prejudice, or (iv) that could adversely affect any Tax or other Liability of Purchaser and its Affiliates). Subject to the immediately preceding sentence, Seller will have full control of such defense and proceedings, including any compromise or settlement thereof. If requested by Seller, Purchaser will, at the sole cost and expense of Seller, provide reasonable cooperation to Seller in contesting the Specified Litigation. Seller hereby guarantees timely payment and performance by Seller of all obligations for of Seller described in this Section 3.4(b) and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; providedshall fulfill, thaton demand, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as all obligations of Seller set forth in this Section 2.73.4(b) if Seller fails to do so. If applicable, any Losses incurred by Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of Company arising from the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline Specified Litigation shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract handled in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned ContractArticle VIII.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Sources: Acquisition and Share Exchange Agreement (Corporate Resource Services, Inc.)
Assumption of Certain Liabilities. (a) On the terms Closing Date, Buyer shall not be obligated to assume, and shall not assume, any of and subject the liabilities or obligations of Seller (absolute, accrued, contingent or otherwise), whether existing prior to the conditions set forth herein, Purchaser shall (i) assume at or as of the Closing and discharge Date, or perform when due the Assumed Liabilities on and asserted after the Closing Date and relating to events that occurred before the Closing Date, or otherwise, except Buyer shall assume and agrees to pay, perform and discharge, in accordance with their respective terms, the following (collectively referred to herein as the "Assumed Liabilities"):
(a) all obligations of Seller arising in the ordinary course of business under the Assigned Leases or the Assigned Contracts to the extent transferable;
(b) all trade accounts payable, customer deposits and accrued expenses, but not any accrued income or sales taxes or employee related expenses including, but not limited to, withholding taxes, 401(k) withholdings or matching contributions, company payroll taxes, vacation accruals, bonuses, miscellaneous withholdings, or accrued salaries and wages, associated with the Assets of Seller as of the Closing Date arising in the ordinary course of business;
(c) the obligations of Seller as of the Closing Date to fill orders received by Seller in the ordinary course of business (i) for the manufacture and sale of lodging and office furniture, (ii) assume for the sale of parts, or (iii) for service and maintenance of said furniture or parts; and
(d) the other obligations and liabilities of Seller that are listed on Exhibit 1.7 hereto. Nothing in this Agreement shall be deemed to create any obligation on the part of Buyer to continue the employment of any individual or to create any contract right or entitlement with respect thereto. Buyer shall have no responsibility for any amounts, obligations, liabilities, compensation, severance pay or benefits of any kind or nature due to Seller's employees through the Closing Date or arising as a result of the termination by Seller of any such employees in connection with the transactions contemplated by this Agreement, including, without limitation, any benefits that may arise under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, and any and all such liabilities and obligations shall be the sole responsibility of Seller. Seller shall prepare and file all payroll reports and Forms W-2 for and pay and discharge when due its employees through the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded ContractsClosing Date. Except as set forth Unless expressly stated in this Section 2.71.7 or in Exhibit 1.7, Purchaser nothing in this Agreement shall not assume or have be deemed to create any Liability or responsibility obligation on behalf of the Buyer with respect regard to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises liabilities arising out of the operation of the Seller's Business or the ownership of the Purchased Assets prior to or the Business, prior to, at or after, through the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability Date of any nature whatsoever, whether known or kind whatsoever of Sellers.
(b) From time to time after the date hereofunknown, direct or indirect, continigent or accrued, matured or unmatured including, but in no event later than 60 days following the Closing Date ornot limited to, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible claims for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution violation of any assumption objection under Section 365(c)(1) statutes, laws, regulations, rules, ordinances or (c)(2) orders of the Bankruptcy Code any authority, whether federal, state or local, tax claims or tax liens, labor relation claims, OSHA related claims, EEOC related claims, employee benefit claims, ERISA related claims, employee claims, environmental, health and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadlinesafety claims, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; providedEPCRA related claims, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible forproduct warranty, product return and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date product liability claims for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal products sold prior to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to through the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court medical, dental and workers' compensation claims, computer software license claims, claims for entry personal injury, claims for injury to property, claims for breach of a Supplemental Order to assume contract, claims for compensatory damages, claims for punitive damages, creditor claims, claims by lenders, claims on accounts, claims for unpaid debts, any and assign to Purchaser all claims by Seller's shareholders, and any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement all litigation arising out of the parties thereto in accordance with the terms foregoing claims. All liabilities of the Sale Approval Order. Sellers Seller not herein defined as Assumed Liabilities shall retain all liabilities and obligations with respect hereinafter be referred to as the Cure Amount relating to any such Ancillary Servicing-Related Agreement"Retained Liabilities."
Appears in 1 contract
Assumption of Certain Liabilities. (a) On At the terms Closing, the Buyer shall assume and agree to perform, pay and discharge from and after the Closing as and when due, in accordance with their respective terms, the liabilities of and subject to the conditions Companies set forth hereinbelow, Purchaser which shall be the only liabilities (whether performance, payment or otherwise) assumed by the Buyer hereunder (the “Assumed Liabilities”):
(i) assume at all contractual obligations of any of the Companies pursuant to the Assumed Contracts solely to the extent that such contractual obligations arise after the Closing Date, other than any Liabilities arising out of any breach or default (including for this purpose any event which, with notice or lapse of time would constitute such a breach or default) occurring prior to the Closing;
(ii) all liabilities with respect to the Transferred Permits solely to the extent attributable to the ownership or operation of the Business on or after the Closing Date;
(iii) all liabilities for any Taxes related to the Acquired Assets accruing after the Closing which are attributable to the ownership or use by Buyer of the Acquired Assets on or after the Closing Date (except for Taxes for which Company is liable pursuant to this Agreement);
(iv) all liabilities under Membership Contracts for which any deposits, prepaid expenses, prepaid or deferred revenue and discharge similar amounts included in the Acquired Assets pursuant to Section 2.1(a) above have been paid, but only to the extent such liabilities arise as a result of Buyer’s operation of the Business after the Closing;
(v) all liabilities for acts or perform when due omissions of the Assumed Liabilities Buyer with respect to the Acquired Employees which accrued on and after the Closing Date; and
(vi) all other current payables of the Companies primarily related to the Business (A) incurred in the ordinary course of business, (B) not aged more than forty-five days as of Closing Date and (iiC) assume all obligations for and pay and discharge when due not associated with breaches of any Contract by a Company prior to the Cure Amounts relating Closing, which shall be of a reasonably similar nature to each Assigned Contract at those payables reflected in the respective Contract Determination Date for such Assigned Contractillustrative spreadsheet attached as Schedule 2.2(a)(vi); provided, that, except as set forth for the avoidance of doubt, such current payables shall not include transaction expenses incurred by the Companies in Section 2.7(b), connection with this Agreement or the other Transaction Documents.
(b) Notwithstanding any provision in no event shall Purchaser assume and discharge when due the Cure Amounts relating this Agreement to the Excluded Contracts. Except as set forth in this Section 2.7contrary, Purchaser except for the Assumed Liabilities, each Company shall retain, and be responsible and liable for, and Buyer shall not assume or have any Liability be obligated to pay, perform or responsibility otherwise discharge or be responsible or liable pursuant to this Agreement or otherwise with respect to to, any Liability Liabilities of any nature the Companies, whether or kind whatsoever relating to the Business or the Purchased Assets that existsnot of, associated with, or arises out arising from any of the operation or ownership of the Purchased Acquired Assets or the Business, prior to, at or after, otherwise and whether carried or not carried on the Closing books and that is records of the Companies (all such liabilities and obligations not an Assumed Liability. Except being assumed being herein referred to as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification DeadlineExcluded Liabilities”), Purchaser shallincluding, in its sole discretion, notify Sellers of but not limited to:
(i) each Assigned Contract that Purchaser has agreed all Indebtedness and other Liabilities of any Company or the Business which are not expressly assumed by the Buyer pursuant to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”Section 2.2(a) and above;
(ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by payable to brokers or other third parties acting on behalf of Sellers under, each Assigned Contract, together Companies or KLIM in connection with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in transactions contemplated by this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.Agreement;
(ciii) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time all Liabilities with respect to any Assigned Contract municipal violations of the Carrying Costs of Business or property subject to Leases occurring prior to the Closing Date;
(iv) all Taxes which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object were due and payable prior to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts Closing Date or relate to resolve such objection and, absent resolution within 10 Business Days any period of Purchaser’s objection, the matter shall be submitted time prior to the Bankruptcy Court, whose determination shall be final and binding upon the parties.Closing Date;
(dv) Sellers shall file a motion all Liabilities arising from or related to the Excluded Assets;
(vi) all Liabilities related to the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order operation of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior prior to the Closing Date, Sellers shall file whether or not the same is disclosed pursuant to Section 3.6 herein;
(vii) all Liabilities prior to the Closing Date related to a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement violation or alleged violation of the parties thereto in accordance with the terms WARN Act;
(viii) all Liabilities for any failure by any of the Sale Approval Order. Sellers shall retain all liabilities and obligations Companies to comply with any Laws or to hold any required Permit with respect to the Cure Amount Business to the extent arising, occurring or existing prior to the Closing,
(ix) all environmental, health or safety liabilities arising out of or relating to the Companies’ ownership or operation of the Business and the Acquired Assets prior to Closing;
(x) all Liabilities arising under the organizational documents of any Company, or related to any person or entity’s interest in any such Ancillary Servicing-Related Agreemententity;
(xi) all common area maintenance charge adjustments and charges for Taxes under the Leases that accrue prior to the Closing Date, whether or not assessed as of the Closing Date; and
(xii) all escheat Liability in connection with Membership Agreements or other deferred revenue accruing prior to Closing.
Appears in 1 contract
Sources: Asset Purchase Agreement (Town Sports International Holdings Inc)
Assumption of Certain Liabilities. Seller shall assign ---------------------------------- and Purchaser will assume certain liabilities of Seller as set forth on the Closing Balance Sheet of Seller which shall be one of the Closing Financial Statements (a) On as defined hereinafter), and as approved by Purchaser (the terms "Assumed Liabilities"). Assumed Liabilities shall include accounts payable, "Bonus Accrual" as defined in Paragraph 14 hereof (upon which Purchaser shall withhold all applicable federal, state and local taxes as required by law), accrued expenses, payroll taxes and other liabilities arising in the ordinary course of and subject business, provided all such liabilities are disclosed to Purchaser on the Closing Balance Sheet delivered pursuant to Paragraph 14 hereof. Notwithstanding anything to the conditions set forth hereincontrary contained above, Purchaser shall (i) assume at the Closing and discharge or perform when due the Assumed Liabilities on shall not include any obligation or liability of Seller with respect to income taxes, penalties and after interest thereon; loans or other credit granted to Seller or its officers, directors or employees; pension, profit-sharing or other similar obligations of Seller whether or not arising from ERISA qualified or approved plans; any liabilities for items outside the ordinary course of business, any liabilities for acts or omissions of Seller, its officers, directors or employees through the Closing Date which are not disclosed on the Closing Balance Sheet and approved in writing by Purchaser (ii) assume all obligations for including but not limited to contingent liabilities, and pay and discharge when due any pending or threatened claims, proceedings, actions, or investigations, whether or not asserted before Closing). Purchaser will advise Seller promptly upon receipt of the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability Closing Balance Sheet of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is liabilities disclosed thereon which Purchaser will not accept as an Assumed Liability. Except as set forth Seller shall have five (5) days thereafter to dispute same in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date orwriting and, if such date does not fall on a Business Daydisputed, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary accountants for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser Seller shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good make best faith efforts to resolve such objection andsame. Notwithstanding, absent Seller shall remain liable therefore pending resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to dispute. Purchaser any additional Contracts or any Separation Shared Contractsmay, in each case that have not been previously rejected by Sellersits discretion, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for pay any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to bedisputed liability, and shall be extended untilentitled to offset the amount paid against any payments due under the Note and Royalty Agreement upon resolution of the dispute in its favor. Seller will indemnify Purchaser for any liability other than Assumed Liabilities which are asserted against Purchaser in connection with the transaction or the Assets acquired hereby, including reasonable attorneys fees. Purchaser shall give prompt written notice to Seller of any such asserted liabilities and Seller shall have a reasonable opportunity to defend. In the later event such liability is not paid by Seller, or the claim against Purchaser dismissed within sixty (60) days of (x) the date that is 45 days after of notice to Seller, or adequate security or bond provided to Purchaser and acceptable to Purchaser's counsel, Purchaser may offset the date that amount of such Additional Contract is identified by Purchaser liabilities (and its reasonable attorneys fees) against any payments due to SellersSeller or Mr. Shapiro under this Agreement or any document executed ▇▇ ▇▇▇▇▇▇▇ion herewith, subject including, but not limited to the approval of Sellers in their sole discretion; Note and Royalty Agreement (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadlineas hereinafter defined). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Sources: Asset Purchase Agreement (Touchstone Applied Science Associates Inc /Ny/)
Assumption of Certain Liabilities. (a) On Upon the terms of and subject to the conditions set forth herein, Purchaser shall (i) assume at the Closing and discharge or perform when due First Closing, GFB-AS shall agree to guaranty, on terms reasonably acceptable to GFB-AS, the Assumed Liabilities on and after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except bank debt of approximately $12.9 million as set forth on Schedule 1.3 attached hereto ("Bank Debt") consisting of nine lenders holding as collateral, limited partner investor notes in Section 2.7(bthe approximate amount of $17.7 million as set forth on Schedule 1.3 attached hereto ("Investor Notes"). The GFB-AS guaranty will be on terms reasonably acceptable to GFB-AS, which shall include a requirement that the holders of the Bank Debt, at their cost, continue to use their best efforts on collection of the Investor Notes, which shall include litigation if necessary, that GFB-AS or Grand Court, if requested, will send out the standard notices of collection, and the best efforts of Grand Court, if requested, to assist in no event the collection process and that GFB-AS shall Purchaser assume and discharge when due the Cure Amounts relating only be called upon to the Excluded Contractspay under its guaranty if such collection efforts fail. Except as expressly set forth in this Section 2.7Agreement, Purchaser shall GFB-AS do not hereby assume or agree to pay any other liabilities or obligations of Grand Court, the limited partners of the Partnerships, the Partnership, or any other entity. Each GFB-AS subsidiary that is admitted as a general partner of an Owning Partnership or an Investing Partnership shall have any Liability liability for obligations of such Partnership arising or responsibility with respect to any Liability of any nature or kind whatsoever relating accruing after such admission as general partner to the Business or full extent provided by applicable law for an incoming general partner and the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liabilitywithdrawing general partner shall have no liability for such obligations. Except as set forth provided above, it is expressly understood that GFB-AS shall not be liable for and do not assume any of Grand Court's, the limited partners' of the Partnerships, the Partnerships', or any other entity's obligations or liabilities (whether known or unknown, matured or unmatured, or fixed or contingent) other than the guaranty of the Bank Debt as expressly provided in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall 1.3 and those obligations and liabilities expressly set forth on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded ContractSchedule 1.3 attached hereto. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of Without limiting the foregoing, the Sale Approval Order shall provide that the assignment GP Interests and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs Management Rights shall not include (a) any attorneys’ claims for workmen's compensation, (b) any federal, state, or financial advisory fees local taxes on income or any federal, state, or local taxes arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 by reason of the Bankruptcy Code. With respect to each Assigned Contractsale of the rights as herein provided or otherwise or any other Taxes (as hereinafter defined), between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect any liability for any violation by Grand Court or the Partnerships of any applicable statutes, laws, regulations, or ordinances of any federal, state, or local government, (d) any liability for any breach of contract, negligence, or misconduct by Grand Court or the Partnerships or any of its or their respective agents, servants, or employees, (e) any liability of Grand Court or the Partnerships arising out of or pursuant to each Assigned Contractthis Agreement, Sellers shall(f) any liability of Grand Court or the Partnerships relating to any litigation arising from any event, within 60 days after action, or omission, (g) any liability for any employee or other compensation, including, without limitation, any salaries, bonuses, incentive compensation, or accrued vacation time, relating to services provided to Grand Court or the later Partnerships, before the First Closing, as to the Partnerships, (h) any liability of Grand Court or the Partnerships relating to employee benefit plans maintained by Grand Court or the Partnerships, before the First Closing, as to the Partnerships, (i) any liability arising out of or incurred in respect of any transaction of Grand Court occurring before or after the Contract Determination Date First Closing, (j) any liability for such Assigned Contract any accrued and unpaid federal, state, or local taxes of Grand Court based on income of its employees, (k) any trade or other accounts payable of Grand Court or the Partnerships, or (iil) any other liability or obligation of Grand Court or the Contract Notification DeadlinePartnerships other than the Bank Debt, advise Purchaser in writing of the amount of the Carrying Costs with respect to unless such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which liabilities are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the partiesset forth on Schedule 1.3 attached hereto.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Sources: Asset Purchase Agreement (Grand Court Lifestyles Inc)
Assumption of Certain Liabilities. (a) On Notwithstanding the terms provisions of and subject Section 3.1 hereof to the conditions set forth hereincontrary, Purchaser covenants and agrees that on the Date of Closing, it shall execute and deliver to Sellers an Assumption Agreement in substantially the form of Exhibit B hereto (the "Assumption Agreement") pursuant to which it will assume and agree to perform and discharge the following debts, liabilities and obligations of Sellers:
a. All debts, liabilities and obligations of Sellers arising under the Operating Contracts which become performable after the Date of Closing, except that Purchaser expressly does not assume any liabilities for (i) assume at products sold or services rendered by the Closing and discharge Business under such Operating Contracts on or perform when due prior to the Assumed Liabilities on and after the Closing Date and of Closing, (ii) assume all for any debts, liabilities or obligations for and pay and discharge when due arising as a result of a breach or default by either Seller under any of such Operating Contracts occurring on or before the Cure Amounts relating to each Assigned Contract at Date of Closing or as a result of the respective Contract Determination Date for such Assigned Contract; providedconsummation of the transactions contemplated hereby, that(iii) any long-term indebtedness (including the current portion thereof), except as set forth in Section 2.7(b)on Schedule 3.2 hereto; or (iv) any fees or commissions payable by Sellers or any other person to brokers, in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7consultants, Purchaser shall not assume finders or have any Liability or responsibility others with respect to any Liability the offer or sale of any nature Sellers' franchises or kind whatsoever relating to area development agreements, except as reflected in the Business or deferred revenues from the Purchased Assets that existssale of franchises on the Closing Balance Sheet;
b. All of Sellers' trade accounts payable, or arises deferred revenues from the sale of franchises, and other current liabilities, in each case arising out of the operation or ownership of the Purchased Assets or Business in the BusinessOrdinary Course of Business (as hereinafter defined) which remain unpaid on the Date of Closing, prior to, at or after, but only to the extent reflected on the Closing and Balance Sheet; provided that is Purchaser expressly does not an Assumed Liability. Except assume (i) any accrued taxes of any nature, (ii) any liabilities to any Related Person (as hereinafter defined), or (iii) any long-term debt (including the current portions thereof), except as set forth in this Section 2.7on Schedule 3.2 hereto; and
c. All debts, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to of Sellers identified on Schedule 3.2 hereto (including leases for the Cure Amount relating to any such Ancillary Servicing-Related AgreementLeased Premises).
Appears in 1 contract
Assumption of Certain Liabilities. (a) On Seller shall assign and Purchaser will assume certain liabilities of Seller as set forth on Schedule 2(a) (the terms "Assumed Liabilities"). Assumed Liabilities shall include, but not be limited to, the accounts payable in the ordinary course of business and subject the shareholder loan by Faith Takes to Seller in the approximate amount as of 7/31/98 of $86,600 (the "Takes Loan"), the obligations under the Capital Bank Trust/SBA loan, the obligations under the TFC Credit Corporation loan, the obligations under the Ballston Spa bridge loan, accrued expenses, payroll taxes and other liabilities arising in the ordinary course of business, provided all such liabilities are disclosed to Purchaser on the Closing Balance Sheet delivered pursuant to Paragraph "11" hereof. Notwithstanding anything to the conditions set forth hereincontrary contained above, Purchaser shall (i) assume at the Closing and discharge or perform when due the Assumed Liabilities on shall not include any obligation or liability of Seller with respect to income taxes, penalties and after the Closing Date and interest thereon (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b(b) below); pension, profit-sharing or other similar obligations of Seller whether or not arising from ERISA qualified or approved plans; any liabilities for items outside the ordinary course of business which are not disclosed to Purchaser and approved in no event shall writing by Purchaser; any liabilities for material acts or omissions of Seller, its officers, directors or employees through the Closing Date which are not disclosed on the Closing Balance Sheet and approved in writing by Purchaser assume (including but not limited to contingent liabilities, and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7any pending or threatened claims, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that existsproceedings, actions, or arises out of the operation investigations, whether or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellersasserted before Closing).
(b) From time Purchaser and Seller agree that Purchaser shall accept on the Closing Balance Sheet as an Assumed Liability an accrual for income taxes equal to time after the date hereof, but in no event later than 60 days following thirty-five (35%) percent of Federal taxable income of Seller as of the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract calculated by the Contract Notification Deadline shall be deemed certified public accountants for Seller to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related distributed to the Bankruptcy Cases or Sellers and their Affiliates status Shareholders in such amounts as debtors-in-possession under Chapter 11 of the Bankruptcy Codedetermined by such accountants. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract3.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Sources: Asset Purchase Agreement (Touchstone Applied Science Associates Inc /Ny/)
Assumption of Certain Liabilities. On the Closing Date, Buyer shall not be obligated to assume, and shall not assume, any of the liabilities and obligations of Seller, whether existing as of the Effective Time, or asserted or first arising after the Effective Time and relating to events that occurred before the Effective Time, or otherwise, which liabilities and obligations Seller agrees to pay and discharge (collectively, the "Excluded Liabilities"), except that Buyer shall assume and agree to pay, perform and discharge the following liabilities and obligations of Seller as of the Effective Time, which shall be assumed by Buyer on the Closing Date as of the Effective Time:
(a) On the terms future obligations of Seller under the Contracts and the Permits;
(b) except as provided to the contrary in Sections 2.1(e) and 11.2 and the Assignment and Assumption Agreement, the future obligations of Seller with respect to the Real Property, the Additional Property (if applicable) and the Leasehold Property, including Seller's obligations under the Bellwood Quarry Lease and the Rockmart Quarry Lease, including Environmental Liability; and
(c) subject to Seller's delivery of the conditions set forth hereinAsphalt Supply Agreement in the form contemplated by Section 2.1(e), Purchaser Seller's liability to ▇▇▇▇▇▇ County, Georgia for royalty payments pursuant to the Bellwood Quarry Lease. Anything to the contrary in this Agreement or otherwise notwithstanding, Buyer shall not assume, and shall have no liability with respect, to any liabilities or obligations of Seller which are not expressly assumed by Buyer pursuant to this Article III, including, without limitation, any of the following items, each of which items shall constitute an Excluded Liability hereunder:
(i) assume at the Closing and discharge any liability or perform when due the Assumed Liabilities on and after the Closing Date and obligation arising out of any Employee Benefit Plan (as hereinafter defined) maintained by or covering employees of Seller or to which Seller has made any contribution or to which Seller could be subject to any liability; (ii) assume all obligations for any losses, costs, expenses, damages, claims, demands and pay judgments of every kind and discharge when due nature (including the Cure Amounts relating defenses thereof and reasonable attorneys' and other professional fees) related to, arising out of, or in connection with Seller's failure to each Assigned Contract at comply with any bulk sales or transfer act or any similar statute as enacted in any jurisdiction, domestic or foreign; (iii) any liability or obligation arising out of any breach by Seller or any of the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating Shareholders prior to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume Effective Time of any provision of any contract to which Seller or have any Liability of the Shareholders is a party and any liability or responsibility obligation of Seller related to the performance required under the Contracts and the Permits before the Effective Time; (iv) any liability of Seller or any of the Shareholders with respect to any Liability claim or cause of any nature action, regardless of when made or kind whatsoever relating to the Business or the Purchased Assets that existsasserted, or which arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser out of or in connection with the Cure Amounts for each Assigned Contractbusiness and operations of Seller prior to the Effective Time, (B) resolution with respect to any product purchased or manufactured or any service provided by Seller prior to the Effective Time, including, without limitation, any liability or obligation of Seller or any assumption objection under Section 365(c)(1of the Shareholders (I) pursuant to any express or implied representation, warranty, agreement, or guarantee made by Seller, or (c)(2II) imposed by operation of the Bankruptcy Code and (C) Purchaser’s right to designate law, in connection with any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadlineservice performed or product designed, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; providedmanufactured, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation sold or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due leased by or on behalf of Sellers underSeller prior to the Effective Time, each Assigned Contractincluding, together with all of Sellers’ reasonablewithout limitation, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly claim related to any product delivered in connection with the Bankruptcy Cases performance of such service and any claims seeking to recover for consequential damage, lost revenue or Sellers income, including pursuant to any doctrine of product liability, or (C) out of or in connection with the Business and their Affiliates status as debtors-in-possession operations of Seller prior to the Effective Time under Chapter 11 any federal, state, or local law, rule, or regulation relating to (I) taxation, or (II) employment or termination of employment; (v) any liabilities or obligations of Seller or any of the Bankruptcy Code. With respect Shareholders relating to each Assigned Contractthe Retained Assets; (vi) any liability or obligation, between arising prior to the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provideEffective Time or as a result of the Closing, to the extent reasonably necessary for Purchaser to operate the Business any employee, agent or independent contractor of Seller, whether or not employed by Buyer after the Closing Date and at Purchaser’s sole cost and expenseClosing, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later under any Employee Benefit Plan maintained by or covering employees of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.Seller;
Appears in 1 contract
Assumption of Certain Liabilities. (a) On Subject to the terms and conditions of and subject to this Agreement, except as otherwise specifically provided in this Section 1.3 (including in respect of the conditions Retained Liabilities, as set forth hereinin paragraph (b) below), Purchaser shall Buyer hereby assumes and agrees to pay, discharge and/or perform, as appropriate, the following specific liabilities and obligations of Seller (the "Acquired Liabilities"):
(i) assume at all liabilities and obligations of Seller in respect of the Business existing as of the Interim Balance Sheet Date (as defined in Section 2.6), representing accounts payable and accrued expenses (including any accrued expenses for any leases categorized as "operating leases" in accordance with GAAP (as defined in Section 7.12(k) and accrued Taxes (other than any Income Tax of Seller) payable with respect to the Business, assets, properties or operations of Seller), but only if and to the extent that: (A) the same are accrued or reserved for on the face of the Interim Balance Sheet and the Closing Date Balance Sheet and remain unpaid and undischarged on the Closing Date, and (B) the same are also reflected in the calculation of Closing Date Working Capital (as defined in Section 1.6(c));
(ii) all liabilities and obligations of Seller in respect of the Business representing accounts payable and accrued expenses (including any accrued expenses for any leases categorized as "operating leases" in accordance with GAAP and accrued Taxes (other than any Income Tax of Seller) payable with respect to the Business, assets, properties or operations of Seller) arising in the regular and ordinary course of business between the Interim Balance Sheet Date and the Closing Date, but only if and to the extent that: (A) the same are accrued or reserved for on the face of the Closing Date Balance Sheet (excluding notes or schedules thereto) and remain unpaid and undischarged on the Closing Date, and (B) the same are also reflected in the calculation of Closing Date Working Capital;
(iii) the liabilities described on Schedule 1.3; and
(iv) all liabilities and obligations of Seller in respect of the Contracts, except that Buyer shall not assume or agree to pay, discharge or perform when due any:
(1) liabilities or obligations of the Assumed aforesaid character existing as of the Interim Balance Sheet Date and which under GAAP should have been accrued or reserved for on a balance sheet as a liability or obligation, if and to the extent that the same were not accrued or reserved against on the face of the Interim Balance Sheet;
(2) liabilities or obligations of the aforesaid character existing as of the Closing Date and which under GAAP should have been accrued or reserved for on a balance sheet as a liability or obligation, if and to the extent that the same were not accrued or reserved on the face of the Closing Date Balance Sheet or not reflected in the Closing Date Working Capital; provided, however, if the Press Agreement Conditions are satisfied, this subparagraph (2) shall not apply to any liabilities or obligations in respect of the Press Agreement; and
(3) liabilities or obligations arising out of any breach or default by Seller of any provision of any Contract, including liabilities or obligations arising out of Seller's failure to perform any agreement, contract, commitment or lease in accordance with its terms prior to the Closing.
(b) Buyer will not assume any liabilities, commitments or obligations (known or unknown, contingent or absolute and whether or not determinable as of the Closing) of Seller, except for the Acquired Liabilities as specifically and expressly provided for above, whether such liabilities or obligations relate to payment, performance or otherwise, and all liabilities, commitments or obligations (known or unknown, contingent or absolute and whether or not determinable as of the Closing) not expressly transferred to Buyer hereunder as Acquired Liabilities are being retained by Seller (the "Retained Liabilities"), who shall remain liable therefor unconditionally and without right of set-off. Seller on behalf of itself, hereby irrevocably and unconditionally waives and releases Buyer from all Retained Liabilities, including any Retained Liabilities created by statute or common law. Without limitation to the foregoing, all of the following shall be considered Retained Liabilities and not Acquired Liabilities (except as specified below) for the purposes of this Agreement (whether or not accrued or reserved for on Interim Balance Sheet or the Closing Date Balance Sheet):
(i) any (A) Income Tax of Seller or any member of any affiliated group which Seller is or was, prior to the Closing, a member or (B) other Tax payable with respect to the business, assets, properties or operations of Seller or any member of any affiliated group of which Seller is or was, prior to the Closing, a member, for (1) any period ending prior to the Closing Date or (2) the portion of any period beginning before and ending after the Closing Date that precedes the Closing Date to the extent such Taxes exceed the accrual therefor set forth on the face of the Closing Date Balance Sheet, (C) except as provided in Section 4.11(b) hereof, incident to or arising as a consequence of the negotiation or consummation by Seller (or any member of any affiliated group of which any of them is a member) of this Agreement and the transactions contemplated hereby, or (iiD) assume all obligations payable with respect to any business, assets, properties, or operations of Seller, other than the Business or the Acquired Assets, for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contractany taxable period; provided, thathowever, except as set forth in Section 2.7(b), that in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have term "Retained Liabilities" include any Liability or responsibility with respect to any Liability of any nature or kind whatsoever Tax relating to the Business or the Purchased Acquired Assets that existsrelates to a period following the Closing;
(ii) except as provided in Section 4.10 hereof, any liability or obligation with respect to compensation or employee benefits of any nature owed to any employees, former employees, agents or independent contractors of Seller, whether or not employed by Buyer after the Closing, that (A) arises out of or relates to the operation employment or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing service provider relationship between Seller and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contractindividuals, (B) resolution arises out of or relates to any assumption objection under Section 365(c)(1) Benefit Plan, or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right arises out of or relates to designate events or conditions occurring on or before the Closing Date;
(iii) any Assigned Contract an Excluded Contract liability or obligation of Seller arising or incurred in accordance connection with the terms negotiation, preparation and execution of this Section 2.7(b). From Agreement and the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible fortransactions contemplated hereby, and shall pay in accordance with Section 2.7(cfees and expenses of counsel, accountants, brokers, finders and other experts;
(iv) any product liability or similar claim, regardless of when made or asserted, which arises out of or is based upon any express or implied representation, warranty, agreement or guarantee made or alleged to have been made or which is imposed or asserted to be imposed by operation of law (including by reason of any "strict liability" or related theory of tort law), all costs incurred by Sellers in connection with respect toany product manufactured, and all amounts due leased or sold by, or any service performed by or on behalf of Sellers underSeller prior to the Closing, each Assigned Contractincluding any such claim seeking recovery for consequential damages, together with all lost revenue or income, it being understood, however, that Seller's liabilities in respect of Sellers’ reasonableany standard product warranties given by Seller in respect of its products or services in the ordinary course of business under Contracts (as opposed to product liability claims) are being assumed by Buyer under Section 1.3(a)(iv);
(v) any liability or obligation of Seller existing as a result of any act, necessaryfailure to act or other state of facts or occurrence which constitutes a breach or violation of Seller's representations, warranties and covenants contained in this Agreement or the other Transaction Documents (as defined in Section 1.7(c));
(vi) any Environmental Liability (as defined in Section 7.12(g));
(vii) any indebtedness for borrowed money of Seller of any kind, including (A) any obligation evidenced by bonds, notes debentures or other similar instruments, (B) any obligation (whether contingent or otherwise) for the deferred purchase price of any property or services (whether structured as a bonus payment contingent on achievement of performance objectives, consulting payment or non-compete payment), but excluding obligations to trade creditors incurred in the ordinary course, post-Closing obligations course of business that are specifically attributable to each such Assigned Contract unsecured and are not overdue by more than six months, unless being contested in good faith, (the “Carrying Costs”C) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except all obligations of Seller as set forth lessee or lessees under leases categorized as "capital leases" in this Section 2.7accordance with GAAP, Purchaser’s Carrying Costs shall not include (D) any attorneys’ assumption, guarantee or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 endorsement of the Bankruptcy Code. With respect to each Assigned Contractobligations, between either directly or indirectly, of any Person (as defined in Section 7.12(q)), (E) all obligations resulting from bank overdrafts, (F) all obligations secured by a Lien on the Closing Date Owned Real Property, (G) all reimbursement and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs other obligations with respect to such Assigned Contract in sufficiently reasonable detail; providedletters of credit, thatbankers' acceptances and surety bonds, without limiting the foregoingwhether or not matured, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to (H) all obligations under commodity purchase or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts option agreements or any Separation Shared Contractsother commodity price hedging arrangements, in each case whether contingent or matured, (I) all obligations under any foreign exchange contract, currency swap agreement, interest rate swap, cap or collar agreement or other similar agreement or arrangement designed to alter the risks of that have not been previously rejected by SellersPerson arising from fluctuations in currency values or interest rates, as identified by Purchaser in each case whether contingent or matured, (J) all accrued but unpaid interest (or interest equivalent) on any of the items referred to in this Section 1.3(b)(vii) and approved by Sellers (K) any liability in their sole discretion respect of any redemption premium, call premium, prepayment obligation, or other provision requiring payment in excess of 100% of principal and accrued interest on any of the items referred to in this Section 1.3(b)(vii);
(each, an “Additional Contract” and, collectively, the “Additional Contracts”viii) that, for any reason, are not assumed and assigned to Purchaser pursuant liabilities to the Sale Approval Order, with extent that Seller is entitled to insurance proceeds or otherwise indemnified or which would have been entitled to insurance proceeds (or indemnification) (other than by reason of Section 6.6) but for a claim by the same effect as if such Contracts insurer (or the indemnitor) that Seller (or the indemnitees) had been Assigned Contracts (i) breached its obligations under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and policy of insurance (iior the contract of indemnity) under this Section 2.7, including with respect to or had committed fraud in the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for insurance application;
(ix) any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party liability of Seller to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of its Affiliates;
(x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellersany liabilities or obligations in respect of any Excluded Asset; or
(xi) any other liability of Seller whatsoever, subject including any liability arising out of or relating to the approval ownership or operation of Sellers in their sole discretion; the Acquired Assets and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required on or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior prior to the Closing DateDate (including any predecessor operations), Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry including any claims, obligations or litigation arising out of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount or relating to any such Ancillary Servicing-Related Agreementevents or conditions occurring on or before the Closing Date (including the threatened or pending litigation set forth on Schedule 2.9 hereto), regardless of when made or asserted, except for the Acquired Liabilities as specifically and expressly set forth herein.
Appears in 1 contract
Assumption of Certain Liabilities. (a) On Upon the terms of and subject to the conditions set forth herein, Purchaser shall (i) assume at the Closing and discharge or perform when due First Closing, GFB-AS shall agree to guaranty, on terms reasonably acceptable to GFB-AS, the Assumed Liabilities on and after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except bank debt of approximately $12.9 million as set forth on Schedule 1.3 attached hereto ("Bank Debt") consisting of nine lenders holding as collateral, limited partner investor notes in Section 2.7(bthe approximate amount of $17.7 million as set forth on Schedule 1.3 attached hereto ("Investor Notes"). The GFB-AS guaranty will be on terms reasonably acceptable to GFB-AS, which shall include a requirement that the holders of the Bank Debt, at their cost, continue to use their best efforts on collection of the Investor Notes, which shall include litigation if necessary, that GFB-AS or Grand Court, if requested, will send out the standard notices of collection, and the best efforts of Grand Court, if requested, to assist in no event the collection process and that GFB-AS shall Purchaser assume and discharge when due the Cure Amounts relating only be called upon to the Excluded Contractspay under its guaranty if such collection efforts fail. Except as expressly set forth in this Section 2.7Agreement, Purchaser shall GFB-AS do not hereby assume or agree to pay any other liabilities or obligations of Grand Court, the limited partners of the Partnerships, the Partnership, or any other entity. Each GFB-AS subsidiary that is admitted as a general partner of an Owning Partnership or an Investing Partnership shall have any Liability liability for obligations of such Partnership arising or responsibility with respect to any Liability of any nature or kind whatsoever relating accruing after such admission as general partner to the Business or full extent provided by applicable law for an incoming general partner and the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liabilitywithdrawing general partner shall have no liability for such obligations. Except as set forth provided above, it is expressly understood that GFB-AS shall not be liable for and do not assume any of Grand Court's, the limited partners' of the Partnerships, the Partnerships', or any other entity's obligations or liabilities (whether known or unknown, matured or unmatured, or fixed or contingent) other than the guaranty of the Bank Debt as expressly provided in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall 1.3 and those obligations and liabilities expressly set forth on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded ContractSchedule 1.3 attached hereto. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of Without limiting the foregoing, the Sale Approval Order shall provide that the assignment GP Interests and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs Management Rights shall not include (a) any attorneys’ claims for workmen's compensation, (b) any federal, state, or financial advisory fees local taxes on income or any federal, state, or local taxes arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 by reason of the Bankruptcy Code. With respect to each Assigned Contractsale of the rights as herein provided or otherwise or any other Taxes (as hereinafter defined), between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect any liability for any violation by Grand Court or the Partnerships of any applicable statutes, laws, regulations, or ordinances of any federal, state, or local government, (d) any liability for any breach of contract, negligence, or misconduct by Grand Court or the Partnerships or any of its or their respective agents, servants, or employees, (e) any liability of Grand Court or the Partnerships arising out of or pursuant to each Assigned Contractthis Agreement, Sellers shall(f) any liability of Grand Court or the Partnerships relating to any litigation arising from any event, within 60 days after action, or omission, (g) any liability for any employee or other compensation, including, without limitation, any salaries, bonuses, incentive compensation, or accrued vacation time, relating to services provided to Grand Court or the later Partnerships, before the First Closing, as to the Partnerships, (h) any liability of Grand Court or the Partnerships relating to employee benefit plans maintained by Grand Court or the Partnerships, before the First Closing, as to the Partnerships, (i) any liability arising out of or incurred in respect of any transaction of Grand Court occurring before or after the Contract Determination Date First Closing, (j) any liability for such Assigned Contract any accrued and unpaid federal, state, or local taxes of Grand Court based on income of its employees, (k) any trade or other accounts payable of Grand Court or the Partnerships, or (ii1) any other liability or obligation of Grand Court or the Contract Notification DeadlinePartnerships other than the Bank Debt, advise Purchaser in writing of the amount of the Carrying Costs with respect to unless such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which liabilities are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the partiesset forth on Schedule 1.3 attached hereto.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Sources: Asset Purchase Agreement (Grand Court Lifestyles Inc)
Assumption of Certain Liabilities. As further consideration for the purchase of the Purchased Assets, Buyer shall by instruments executed and delivered at the Closing, which instruments shall be reasonably satisfactory to Seller (the "ASSUMPTION AGREEMENTS") assume the following liabilities of the Seller (collectively, the "ASSUMED LIABILITIES"):
(a) On the terms all liabilities and obligations of and subject Seller to the conditions set forth herein, Purchaser shall (i) assume at the Closing and discharge be paid or perform when due the Assumed Liabilities on and performed after the Closing Date and (ii) assume all obligations for and pay and discharge when due under the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth Contracts included in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that existsand identified in Schedule 2.1(a)(iv), but only if and to the extent the same are agreed by Buyer to be assigned and transferred to Buyer;
(b) all liabilities and obligations of Seller set forth on the Closing Date Balance Sheet; and
(c) any obligation accruing to Seller for Texas unemployment compensation resulting from Buyer's failure to hire or arises employ any of Seller's employees (other than individual Partners) after the Closing Date or Buyer's later termination of any such employees, which obligations Buyer expressly agrees promptly to discharge on behalf of Seller or otherwise reimburse Seller in respect thereof. Buyer does not hereby, and will not at any time be required to, assume, pay, perform or discharge any other obligations, claims, liabilities, costs or expenses of Seller including, without limitation, the following: (i) any obligation or liability, direct or indirect, fixed or contingent, known or unknown, incurred prior to the Closing Date, arising out of the operation of, resulting from or ownership of in any way related to the Purchased Assets or the BusinessBusiness of Seller, including any employment (including accrued payroll expenses) or severance obligations of Seller (other than as expressly assumed pursuant to Section 2.4(c)); (ii) any obligation or liability, direct or indirect, fixed or contingent, known or unknown to Seller, arising out of an event, act, condition or occurrence which took place or occurred on or prior to, at or after, to the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, Date other than the Assumed Liabilities, Purchaser shall not assume ; (iii) any Liability Tax liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretionSeller; and (yiv) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect any liability of any kind, direct or indirect, fixed or contingent, arising out of, resulting from or relating to any action required actions taken or permitted omitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay Seller after the legal fees of Sellers involved in any such litigationClosing.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Sources: Asset Purchase Agreement (Rti International Metals Inc)
Assumption of Certain Liabilities. (a) Avanex shall not assume any Liabilities of Corning except for those Liabilities which Avanex expressly assumes pursuant to this Section 3.5. On the terms of and subject to the conditions set forth hereinof this Agreement, Purchaser shall Avanex shall, on the Closing Date (as defined below), assume only the following liabilities and obligations of Corning (the “Assumed Corning Liabilities”):
(i) assume at all obligations and liabilities of Corning under the Closing Corning Transferred Agreements and discharge the Corning Transferred Third Party IP Contracts, but only to the extent such liabilities or perform when due the Assumed Liabilities on obligations (A) first arise or are first incurred from and after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; providedDate, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume extent such Corning Transferred Agreements or have any Liability or responsibility with respect Corning Transferred Third Party IP Contracts are assigned and transferred to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, Avanex at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does or to the extent the benefits and obligations of any Corning Transferred Agreement or Corning Transferred Third Party IP Contracts not fall on a Business Day, properly assigned or transferred to Avanex at the next succeeding Business Day (Asset Purchase Closing shall exist for the “Contract Notification Deadline”account of Avanex pursuant to Section 8.9(d)(iii), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution do not arise from or relate to a breach by Corning of any assumption objection under Section 365(c)(1) or (c)(2) provision of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior Corning Transferred Agreements prior to the Closing Date, Sellers shall file (C) do not arise from or relate to any event, circumstance or condition occurring or existing on or prior to the Closing Date that, with notice or lapse of time, would constitute or result in a Supplemental Motion with the Bankruptcy Court for entry breach of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto Corning Transferred Agreements or Corning Transferred Third Party IP Contracts, and (D) are in accordance with exchange for consideration which is included in the terms Purchased Corning Assets received by Corning prior to the Closing Date,
(ii) all obligations and liabilities relating to the ownership, use or operation of the Sale Approval Order. Sellers shall retain Purchased Corning Assets by Avanex which first arise or are first incurred from and after the Asset Purchase Closing,
(iii) the Corning Repair and Warranty Obligations,
(iv) all liabilities obligations and Liabilities assumed or agreed to by Avanex under Section 8.4, and
(v) all obligations with respect to and Liabilities first arising under the Cure Amount relating to any such Ancillary Servicing-Related AgreementCorning Milan Lease Agreement following the Closing Date.
Appears in 1 contract
Sources: Share Acquisition and Asset Purchase Agreement (Avanex Corp)
Assumption of Certain Liabilities. (a) On At the terms Closing, each of the Purchaser, Continental and subject Mattituck will, jointly and severally, assume and become responsible for, and will thereafter pay, perform and discharge when due, all of the following liabilities, whether absolute or contingent, known or unknown, matured or unmatured or whether arising prior to or after the conditions set forth hereinClosing (collectively, the “Assumed Liabilities”) pursuant to an Assumption Agreement in the form attached to this Agreement as Exhibit A (the “Assumption Agreement”); provided, however, that nothing contained herein shall require the Purchaser to pay or discharge any liabilities or obligations expressly assumed hereunder so long as the Purchaser shall in good faith contest or cause to be contested the amount or validity thereof; provided, further, that notwithstanding the foregoing, as between Purchaser and Seller, Purchaser shall (i) assume at the Closing and discharge pay or perform when due the Assumed Liabilities on and after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating amount of any such liabilities or obligations, or portion thereof, (i) that are not being contested in good faith, (ii) that are reimbursable pursuant to each Assigned Contract at Section 7.5, (iii) which are found by a court or Governmental Entity (and such finding is binding, final and not subject to further appeal) to be legitimate liabilities or obligations or (iv) which it voluntarily agrees to pay despite there being a good faith reason for contesting them:
(i) all liabilities of the Seller (including any liabilities of their respective Contract Determination Date predecessors, Subsidiaries and Affiliates for such Assigned Contractwhich Seller has liability) related to the Business, including, without limitation, all aviation- and product liability-related litigation and claims and future aviation- and product liability-related litigation and claims related to or arising out of the Continental Business or the Mattituck Business (which claims include, without limitation, those claims listed on Schedule 4.12 of the Disclosure Schedules) and any self-insured retentions and deductibles related to the Existing Policies; provided, thathowever, except as set forth that to the extent that such assumption would result in Section 2.7(ba claim or liability that would otherwise be covered under the Existing Policies to no longer be covered under such Existing Policies, then such claim or liability shall not be assumed by the Purchaser, Continental or Mattituck and instead the Purchaser, Continental and Mattituck shall, jointly and severally, promptly reimburse the Seller for any amounts actually paid (provided such payments were made with Purchaser’s written consent, which consent shall not be unreasonably withheld, conditioned or delayed) by the Seller or any of the Seller’s Affiliates related to such claim or liability; provided further, that the Purchaser, Continental and Mattituck shall conduct activities related to all aviation- and product liability-related litigation and claims and future aviation- and product liability related litigation and claims arising out of the Continental Business or the Mattituck Business (which claims include, without limitation, those claims listed on Schedule 4.12 of the Disclosure Schedules), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility including with respect to administration, handling, management, defense and settlement in substantially the same manner as if such claim or liability had been assumed by the Purchaser, Continental and Mattituck.
(ii) all liabilities and obligations of the Seller with respect to Employees and former employees which Purchaser has agreed to assume pursuant to Section 8 of this Agreement, including, without limitation, the Teledyne Continental Motors Union 401(k) Plan (“Union 401(k) Plan”) liabilities and those liabilities and obligations for sale bonus and stay/severance bonuses (but not any Liability obligations under annual incentive plans, stock option plans, performance share plans or restricted stock programs) pursuant to sale and stay bonus agreements and severance commitments listed on Schedule 2.3(a)(ii), but excluding any obligations of Seller under any nature or kind whatsoever relating Seller Sponsored Employee Benefit Plans and those payments characterized in those agreements listed on Schedule 2.3(a)(ii) as “Option Alternative Payments”; and
(iii) all liabilities and obligations of the Seller with respect to the Business or the Purchased Assets that existsTeledyne Aviation Exposure Escrow Fund, or arises out including, without limitation, all administrative responsibilities and future contribution obligations, related to those asbestos cases identified on Schedule 4.12 of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing Disclosure Schedules and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellersapplicable future asbestos claims.
(b) From time to time after At the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business DayClosing, the next succeeding Business Day Purchaser and Continental will assume and become responsible for, and will thereafter pay, perform and discharge when due, all of the liabilities and obligations arising from or related to the Purchased Assets pursuant to an Assignment and Assumption Agreement for Intellectual Property in the form attached to this Agreement as Exhibit C (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded ContractsAssignment Agreement”); provided, however, that nothing contained herein shall require the Purchaser to pay or discharge any Assigned Contract that has not been designated by liabilities or obligations expressly assumed hereunder so long as the Purchaser as either an Accepted Contract shall in good faith contest or an Excluded Contract by the Contract Notification Deadline shall be deemed cause to be an Excluded Contractcontested the amount or validity thereof; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of notwithstanding the foregoing, as between Purchaser and Seller, Purchaser shall pay or discharge when due the Sale Approval Order shall provide that the assignment and assumption to Purchaser amount of the Assigned Contracts is approvedany such liabilities or obligations, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contractor portion thereof, (Bi) resolution of any assumption objection under Section 365(c)(1) that are not being contested in good faith or (c)(2ii) of the Bankruptcy Code and which are found by a court or Governmental Entity (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Datefinding is binding, Sellers shall provide, final and not subject to the extent reasonably necessary for Purchaser further appeal) to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease be legitimate liabilities or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contractobligations.
(c) With respect to each Assigned ContractExcept as expressly set forth in this Agreement or the Ancillary Agreements, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing none of the amount Purchaser, Continental or Mattituck shall assume any other liabilities of the Carrying Costs Seller, whether or not in connection with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting this Agreement and the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding thereforAncillary Agreements, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount transactions contemplated hereby and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigationthereby.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Assumption of Certain Liabilities. (a) On In connection with the sale, transfer, conveyance, assignment and delivery of the Assets pursuant to this Agreement, on the terms of and subject to the conditions set forth hereinin this Agreement, Purchaser shall assume and become responsible for, from and after the Closing, only the following obligations or liabilities (the “Assumed Liabilities”): (i) assume at the Closing those obligations or liabilities arising under any Assumed Contract that accrue and discharge or perform when due the Assumed Liabilities on are required to be performed from and after the Closing Date and Closing; (ii) assume the following promotional liabilities of Seller (the “Promotional Liabilities”): (A) any and all obligations complimentaries or jackpot liabilities of Seller, (B) mailings and “match the deal” promotions, pull tab “carry out games” and (C) “two for one” dining coupons and dining gift certificates, all as more particularly described in Section 1.02(a)(ii) of the Disclosure Schedule, in an aggregate amount not to exceed $30,000.00; (iii) the accrued vacation pay and discharge when due sick leave with respect to Employees of Seller who accept employment with Purchaser as of the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; providedClosing Date, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume 1.02(a)(iii) of the Disclosure Schedule and discharge when due (iv) those Liens described on Section 1.02(a)(iv) of the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Disclosure Schedule.
(b) Purchaser shall not assume or have any Liability otherwise become responsible for, and Seller shall remain liable for and discharge when due, all liabilities or responsibility obligations (whether known or unknown, absolute or contingent, liquidated or unliquidated, due or to become due; and whether claims with respect to any Liability thereto are asserted before or after the Closing) of any nature or kind whatsoever relating to the Business or the Purchased Assets Seller that existsare not Assumed Liabilities (collectively, or arises out “Retained Liabilities”). In furtherance and not in limitation of the operation foregoing, within ten (10) days following the Closing Date, Seller shall file or ownership of the Purchased Assets or caused to be filed all Washington state Tax Returns required to be filed in connection with the Business, prior topay all Taxes required to be paid in connection therewith, at or afterand promptly thereafter furnish Purchaser with copies of such Tax Returns, together with evidence of filing the Closing same and payment of Taxes due thereunder; provided that is not an Assumed Liability. Except notwithstanding the above, all Transfer Taxes shall be paid as set forth in this Section 2.7, other than the Assumed Liabilities, 1.08 hereof. It is expressly understood and agreed by Seller that Purchaser shall not assume any Liability of any nature liability or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for obligation and shall pay have no liability or obligation to each applicable Person that is a any third party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether except as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth expressly provided in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Sources: Asset Purchase Agreement (Nevada Gold & Casinos Inc)
Assumption of Certain Liabilities. (a) On Subject to Section 1.4(b), the terms Purchaser shall not assume any Liabilities of and subject the Seller (whether or not related to the conditions set forth hereinTransferred Assets or the Business), Purchaser shall including without limitation: (i) assume at any Liabilities of the Seller relating to the Excluded Assets; (ii) any Tax Liabilities of the Seller, except to the extent allocated to the Purchaser under Sections 1.5 and 5.4(b); (iii) any Liabilities of the Seller relating to accounts payable or other indebtedness; (iv) any wages or salaries or other Liabilities relating to employment (or termination of employment) of any employees of the Seller (including accrued vacation); (v) any Liabilities under any Seller Contracts (other than Liabilities relating to Transferred Contracts that arise after the Closing Date); or (vi) any other Liabilities of the Seller.
(b) Notwithstanding Section 1.4(a) or any other provision of this Agreement to the contrary, from and after the Closing, the Purchaser shall assume, discharge or and perform as and when due all of the Assumed Liabilities obligations of the Seller under the Transferred Contracts, including assuming liability for any claims based on and or relating to the transfer of the Product Materials acquired from [**] by the Seller to the Purchaser pursuant to this Agreement, but in any case only to the extent that such obligations: (i) arise after the Closing Date and (ii) assume all obligations for do not arise from or relate to any breach by the Seller of any provision of any of such Transferred Contracts; and pay and discharge when due (iii) do not arise from or relate to any event, circumstance or condition occurring or existing on or prior to the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Closing Date for such Assigned Contract; provided, that, except with notice or lapse of time, would constitute or result in a breach of any of such Transferred Contracts (the “Assumed Liabilities”). Notwithstanding the terms of that certain Consent Letter by and among the Purchaser, the Seller and The Rockefeller University, dated November 30, 2011 (the “Consent Letter”), for purposes of clarity, the Seller acknowledges and agrees that the Purchaser is only assuming the obligations of the Seller under the Rockefeller License Agreement and the Ancillary Agreements (as defined in the Consent Letter) subject to the limitations set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date orsentence and, if such date does not fall on a Business Dayany conflict exists between the Consent Letter and this Agreement, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether shall control as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for between Seller and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Sources: Asset Purchase Agreement (Momenta Pharmaceuticals Inc)
Assumption of Certain Liabilities. 2.5.1 Purchaser shall assume, pay, fulfill perform or otherwise discharge only the following liabilities and obligations of Seller to Unrelated Parties ("Assumed Liabilities") on the Closing Date:
(a) On all of Seller's trade, and other accounts payable and liabilities reflected or reserved against as of November 25, 1996 and included on Schedule 2.5.1(a), plus additional expenses or liabilities arising in the terms usual and ordinary course of business consistent with past practice after November 25, 1996 and subject to the conditions set forth herein, Purchaser shall (i) assume at before the Closing Date, which in the aggregate do not exceed $130,000.00;
(b) all liabilities and discharge or perform when due obligations of the Assumed Liabilities Purchased Business accruing on and after the Closing Date under contracts, agreements, licenses, leases and similar documents which are to be transferred to Purchaser, specifically including the obligation to provide, during the term of each Subscriber's or Dealer's contract with Seller, continuing monitoring services of the Central Monitoring Station to all such Subscribers and Dealers; and
(iic) assume all those liabilities and obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except of Seller otherwise specifically assumed by Purchaser in this Agreement as set forth on Schedule 2.5.1(c).
2.5.2 Except as provided in Section 2.7(b)2.5.1, in no event Purchaser shall Purchaser assume not be required to assume, pay, perform, defend or discharge any, and Seller shall retain, pay, perform, defend and discharge when due the Cure Amounts relating to the Excluded Contractsall, of Seller's liabilities and obligations of any and every kind whatsoever, whether disclosed, undisclosed, direct, indirect, absolute, contingent, secured, unsecured, accrued or otherwise, whether known or unknown. Except as set forth in this Section 2.7Further, Purchaser shall not assume or have any Liability agree to pay, perform or responsibility with respect to any Liability of any nature discharge, nor shall Purchaser be, directly or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be indirectly responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by any obligation or on behalf liability of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including Seller with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for breach of any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior commitment prior to the Closing Date, Sellers shall file a Supplemental Motion with or any action, suit or proceeding pending at the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement Closing which is asserted in respect of the parties thereto in accordance with the terms conduct by Seller of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect its business prior to the Cure Amount relating to any such Ancillary Servicing-Related AgreementClosing Date.
Appears in 1 contract
Sources: Asset Purchase Agreement (Security Associates International Inc)
Assumption of Certain Liabilities. (a) On Subject to the terms and conditions of this Agreement, and subject excluding any Retained Liabilities, Buyers are assuming and agreeing to the conditions set forth hereinpay, Purchaser shall (i) assume at the Closing and discharge or perform when due the Assumed Liabilities on and after the Closing Date and (ii) assume all obligations for and pay and discharge when due only the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts following Liabilities relating to the Excluded Acquired Assets and Sellers’ operation of the Business (collectively, the “Assumed Liabilities”) to the extent not previously performed or discharged:
(a) all Liabilities arising, and accruing with respect to the period, after the Closing under the Assumed Contracts. Except as set forth in this Section 2.7, Purchaser ; provided that Buyers shall not assume any Liabilities attributable exclusively to a breach by any Seller that occurred prior to the Closing Date or have any Liabilities relating to the financing of the Sellers;
(b) any and all Liabilities arising, and accruing with respect to the period, after Closing and relating to the ownership, use or sale of any of the Acquired Assets or the sale of the Products (including any Liabilities relating to any product liability, consumer protection, consumer fraud, breach of warranty or similar claim for injury to Person or property), solely with respect to Products sold by Buyers and their Affiliates after the Closing; provided that Buyers shall not assume any Liabilities attributable exclusively to a breach by any Seller that occurred prior to the Closing Date;
(c) any and all Liabilities arising out of the Manufacture, production, distribution, marketing, sale or use of any Product based on, utilizing or otherwise incorporating all or any portion of the Acquired Assets and that is sold on or after the Closing Date; provided that Buyers shall not assume any Liabilities attributable exclusively to a breach by any Seller that occurred prior to the Closing Date;
(d) all Pre-Ordered Items listed on Schedule 1.3(d);
(e) all Accounts Payable relating to the Business (excluding any Accounts Payable relating to Contracts that are not Assumed Contracts and any Liabilities Sellers are responsible for under Section 5.10(b)); and
(f) any and all Liabilities arising out of or relating to the ownership or use of the Acquired Product Registrations or the Acquired Intellectual Property arising, and accruing with respect to the period, on or after the Closing Date. No assumption by Buyers of any of the Assumed Liabilities shall relieve or be deemed to relieve Sellers from any Liability or responsibility under this Agreement with respect to any Liability of any nature representations or kind whatsoever relating to the Business warranties or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred covenants made by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned ContractBuyers.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Sources: Asset Purchase Agreement (Icad Inc)
Assumption of Certain Liabilities. (a) On the terms of and subject to the conditions set forth hereinherein and in the Sale Order, effective as of the Closing, in addition to the payment of the Cash Payment in accordance with Section 2.1, Purchaser shall irrevocably assume from Seller (i) assume at and from and after the Closing pay, perform, discharge, or otherwise satisfy in accordance with their respective terms), and discharge or perform when due Seller shall irrevocably transfer, assign, convey, and deliver to Purchaser, only the following Liabilities, without duplication and only to the extent not paid prior to the Closing (collectively, the “Assumed Liabilities on XE “Assumed Liabilities” ”):
(a) The obligations (the “Assumed Vendor Liabilities”) of Seller with respect to the Critical Vendors (which for the avoidance of doubt, shall exclude the Seller-Responsible Vendor Liabilities);
(b) The Liabilities of Seller from and after the Closing Date and (ii) assume all obligations including, for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; providedavoidance of doubt, that, except cure costs as set forth contemplated in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2365(b) of the Bankruptcy Code and (C) Purchaser’s right to designate other than Seller-Responsible Vendor Liabilities on account of any Seller-Responsible Cure Amount for any Assigned Contract an Excluded Contract in accordance with which the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as counterparty is a result of an inaccuracy in a representation or warranty or breach of a covenantCritical Vendor) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, to Contracts and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract leases (the “Carrying CostsDesignated Contracts”) during that Purchaser chooses to assume at Closing, which list of Designated Contracts is included as Schedule 1.3(b) hereto and may be amended at the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related sole discretion of Purchaser up to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.Closing;
(c) With respect to each Assigned ContractTo the extent not Assumed Liabilities under Sections 1.3(a) and (b) of the Agreement, Sellers shall, within 60 days the Liabilities of Seller under the Vehicle Rental Agreements in effect as of or any time after the later of (i) the Contract Determination Petition Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, thatincluding, without limiting the foregoinglimitation, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object Liabilities relating to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days administration of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.Vehicle Rental Agreements including application or release of driver security deposits;
(d) Sellers shall file a motion All Liabilities of Seller and HFIS under Automobile Insurance Programs whether arising prior to or after the Closing including without limitation (i) deductibles; (ii) claims, (iii) self-insured retentions; and (iv) fees, costs and expenses related to the “Supplemental Motion”Automobile Insurance Programs and the processing of claims thereunder;
(e) with the Bankruptcy Court for entry of an Order All Liabilities (including all government charges or fees) arising out of the Bankruptcy Court (ownership of the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared ContractsAcquired Assets, in each case that have case, from and after the Closing Date;
(f) All Liabilities (including, for the avoidance of doubt, Taxes other than income Taxes of Seller) relating to amounts required to be paid, or actions required to be taken or not been previously rejected by Sellersto be taken, as identified by Purchaser and approved by Sellers in their sole discretion under the Transaction Agreements; and
(each, an “Additional Contract” and, collectively, the “Additional Contracts”g) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts Without duplication: (i) under all Taxes with respect to the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, Acquired Assets for any taxable period (or portion thereof) beginning after the Closing Date; and (ii) under this Section 2.7, including all non-income Taxes with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs Acquired Assets for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request Straddle Period (other than Transfer Taxes to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion be paid by Seller pursuant to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of PurchaserSection 9.1) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days period after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Assumption of Certain Liabilities. (a) On Upon the terms of and subject to the conditions set forth hereinin this Agreement, Purchaser shall Buyer agrees to assume only (i) assume at Seller’s accounts payable and accrued expenses identified on Schedule 1.3(a)(i) to this Agreement, but only up to the Closing amount shown on such Schedule for each of such accounts payable and discharge or perform when due accrued expenses (collectively, the “Assumed Payables”); and (ii) those liabilities and obligations under the Assumed Liabilities Contracts identified on Schedule 1.3(a)(ii) to this Agreement and the obligations under the Assumed Contracts to the extent that such obligations are required pursuant to such Contracts to be performed after the Closing Date (collectively, the “Assumed Contract Liabilities”); and (iiiii) assume all Seller’s express obligations under its standard written warranty to repair or replace products sold by Seller within eighteen (18) months prior to Closing (collectively the “Contract Warranty Obligations”); and (iv) Seller’s obligations for customer prepayments and pay deposits received by Seller prior to Closing and discharge when due identified on Schedule 1.3(a)(iv) to this Agreement (the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after“Assumed Prepayment/Deposit Obligations (collectively, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7Prepayment/Deposit Obligations, other than Contract Warranty Obligations, the Assumed Contract Liabilities and the Assumed Payables being called the “Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers”).
(b) From time to time after Exclusive of solely the date hereofAssumed Liabilities, but in no event later than 60 days following the Closing Date orall other obligations, if such date does not fall on a Business DayIndebtedness, the next succeeding Business Day debts, Taxes, operating expenses, rents, utilities, payables and other liabilities and obligations of Seller of any kind, character or description, whether accrued, absolute, known or unknown, disclosed or undisclosed, contingent or otherwise now existing or hereafter arising (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded ContractsLiabilities”); provided, that any Assigned Contract that has are not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser assumed by Buyer and shall be responsible for retained and shall pay fully paid, satisfied and discharged without cost to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted ContractBuyer by Seller. In furtherance Without limitation of the foregoing:
(i) Buyer shall not assume any, the Sale Approval Order and Seller shall provide that the assignment and assumption to Purchaser retain as part of the Assigned Contracts is approvedExcluded Liabilities, subject only to all Intercompany Obligations (Aas defined in Section 8.16(g) payment by Purchaser of this Agreement);
(ii) Buyer shall not assume any, and Seller shall retain as part of the Cure Amounts for each Assigned ContractExcluded Liabilities, all loans, accounts and other Indebtedness (Bas defined in Section 8.16(f) resolution of this Agreement) owed by Seller, whether as obligor, guarantor or accommodation party, and whether to financial institutions, officers, members, Shareholder, Affiliates or otherwise to any other Person (as defined in Section 8.16(n) of this Agreement);
(iii) Buyer shall not assume, and Seller shall retain as part of the Excluded Liabilities, all liabilities and obligations of Seller in respect of any assumption objection under Taxes (as defined in Section 365(c)(1) or (c)(23.21(a)(ii) of the Bankruptcy Code and this Agreement);
(Civ) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers Buyer shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible forassume, and Seller shall pay in accordance with Section 2.7(c)retain as part of the Excluded Liabilities, all costs incurred by Sellers with respect to, liabilities and obligations under all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations Contracts that are specifically attributable not Assumed Contracts. In particular, but without limitation, Seller shall retain and will be liable, directly or indirectly, to each such Assigned Contract (any of the “Carrying Costs”) during the period from terminated Employees on or before the Closing Date through the for severance pay or other severance benefits, whether by policy, benefit plan, practice or Contract Determination Date for each such Assigned Contractand Buyer will not assume any liabilities, obligations or Indebtedness now existing or hereafter arising under, or be deemed a successor company to Seller in connection with, any Employee Plan, collective bargaining agreement or other employment related arrangement to which any present or former employees of Seller is or were entitled (including any severance arrangements). Except as set forth Further, Buyer shall have no obligation to employ any of Seller’s employees; and
(v) Unless specifically identified in this Section 2.7Agreement as part of the Assumed Liabilities, Purchaser’s Carrying Costs Buyer shall not include any attorneys’ or financial advisory fees arising from assume any, and directly related to the Bankruptcy Cases or Sellers and their Affiliates status Seller shall retain as debtors-in-possession under Chapter 11 part of the Bankruptcy Code. With respect Excluded Liabilities, all liabilities and obligations (whether direct or indirect, accrued or contingent, and whether now existing or hereafter arising) which arise in connection with or relate in any manner to each Assigned Contract, between any of the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned ContractExcluded Assets.
(c) With respect Seller covenants to each Assigned Contractpay, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs discharge and satisfy fully as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted when due to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigationpaid or performed all Excluded Liabilities.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Assumption of Certain Liabilities. (a) On In connection with the sale, transfer, conveyance, assignment and delivery of the Assets pursuant to this Agreement, on the terms of and subject to the conditions set forth hereinin this Agreement, Purchaser shall assume and become responsible for, from and after the Closing, only the following obligations or liabilities (the “Assumed Liabilities”): (i) assume at the Closing those obligations or liabilities arising under any Assumed Contract that accrue and discharge or perform when due the Assumed Liabilities on are required to be performed from and after the Closing Date and Closing; (ii) those liabilities described on Section 1.02(a)(ii) of the Disclosure Schedule; (iii) liabilities of Seller for non-inventoried gaming chips existing and redeemable as of the Closing; and (iv) the following liabilities of Seller existing and redeemable as of the Closing (the “Promotional Liabilities”): (A) liabilities for player’s club points and pull tabs, and (B) any and all complimentaries, gift certificates and promotions of Seller. In furtherance of the preceding sentence and solely in order to assist the Parties with the physical inventory at the Closing, on the day immediately preceding the Closing, Seller shall provide to Purchaser an estimated amount of all gaming chips and Promotional Liabilities as of such date supported with sufficient documentation for the Promotional Liabilities, including for all purchased gaming chips and a physical inventory count of all gaming chips on hand. The final amount of the gaming chips and Promotional Liabilities shall be determined following the joint inventory by the Parties on the Closing Date. Notwithstanding the foregoing, except for those liabilities set forth in clause (i), (ii), (iii) and (iv) of this Section 1.02(a), Purchaser shall not assume, and Seller shall remain liable for jackpots and any other gaming instruments of Seller then representing a claim against Seller existing as of the Closing Date.
(b) Purchaser shall not assume all obligations or otherwise become responsible for, and Seller shall remain liable for and pay and discharge when due, all liabilities or obligations (whether known or unknown, absolute or contingent, liquidated or unliquidated, due or to become due, and whether claims with respect thereto are asserted before or after the Cure Amounts relating Closing) of Seller that are not Assumed Liabilities (collectively, “Retained Liabilities”). In furtherance and not in limitation of the foregoing, within the required period under applicable Law, Seller shall file or caused to each Assigned Contract at be filed all Washington state Tax Returns required to be filed in connection with the respective Contract Determination Date for Business, pay all Taxes required to be paid in connection therewith, and promptly thereafter furnish Purchaser with copies of such Assigned ContractTax Returns, together with evidence of filing the same and payment of Taxes due thereunder; providedprovided that notwithstanding the above, that, except all Transfer Taxes shall be paid as set forth in Section 2.7(b), in no event shall Purchaser assume 1.08 hereof. It is expressly understood and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets agreed by Seller that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature liability or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for obligation and shall pay have no liability or obligation to each applicable Person that is a any third party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether except as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth expressly provided in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
Appears in 1 contract
Sources: Asset Purchase Agreement (Nevada Gold & Casinos Inc)
Assumption of Certain Liabilities. (a) On the terms of and subject to the conditions set forth herein, in the Sale Order, and in the Canadian Sale Recognition Order, effective as of the Closing, in addition to the payment of the Cash Payment in accordance with Section 2.1, Purchaser or a Designated Purchaser shall irrevocably assume from each Seller (i) assume at the Closing and discharge or perform when due the Assumed Liabilities on from and after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the pay, perform, discharge, or otherwise satisfy in accordance with their respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(bterms), in no event and Sellers shall irrevocably transfer, assign, convey, and deliver to Purchaser assume or a Designated Purchaser, only the following Liabilities, without duplication and discharge when due the Cure Amounts relating only to the Excluded Contracts. Except as set forth in this Section 2.7extent not paid prior to the Closing (collectively, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability the “Assumed Liabilities”):
(a) all Liabilities and obligations of any nature or kind whatsoever relating to Seller under the Business or Assigned Contracts that become due from and after the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.Closing;
(b) From time all cure costs required to time after be paid pursuant to section 365 of the date hereof, but Bankruptcy Code in no event later than 60 days following connection with the Closing Date or, if such date does not fall on a Business Day, assumption and assignment of the next succeeding Business Day Assigned Contracts (the “Contract Notification DeadlineCure Costs”);
(c) all Liabilities (including, for the avoidance of doubt, Taxes other than income Taxes of Sellers) relating to amounts required to be paid, or actions required to be taken or not to be taken, by Purchaser shall, in its sole discretion, notify Sellers of under this Agreement and all Transfer Taxes;
(id) each Assigned Contract that all Liabilities agreed to be assumed by Purchaser or for which Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with this Agreement; and
(e) all Liabilities arising out of or relating to any environmental, health or safety matter, including those arising under or relating to Environmental Laws or Hazardous Materials, in connection with ownership, operation, use or maintenance of the terms of this Section 2.7(b). From the date hereof until the Contract Notification DeadlineAcquired Assets, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation whenever arising or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract occurring (the “Carrying CostsEnvironmental Liabilities”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this other than those Environmental Liabilities
(i) that are with proper notice dischargeable, or capable of being sold free and clear, pursuant to Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 363 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination DateCCAA, Sellers shall providethe Sale Order or the Canadian Sale Recognition Order, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing that are with proper notice otherwise dischargeable pursuant to Section 1141 of the amount Bankruptcy Code, the CCAA, the Sale Order or the Canadian Sale Recognition Order, or (iii) from which the Acquired Assets are with proper notice otherwise released as of the Carrying Costs with respect Closing pursuant to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court or Canadian Court, including the Sale Order and Canadian Sale Recognition Order, respectively (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, all those Environmental Liabilities described in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion clauses (each, an “Additional Contract” and, collectivelyi-iii), the “Additional ContractsExcluded Environmental Liabilities”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
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Sources: Asset Purchase Agreement
Assumption of Certain Liabilities. Notwithstanding the provisions of Section 3.1 hereof to the contrary, Purchaser covenants and agrees that on the Date of Closing, it shall execute and deliver to Seller an Assignment and Assumption Agreement in substantially the form of Exhibit 3.2 hereto (the "Assumption Agreement"), pursuant to which it will assume and agree to perform and discharge the following debts, liabilities and obligations of Seller and ICL:
(a) On All of Seller's trade accounts payable (being maintained by Seller consistent with its past practices) arising out of the terms operation of and subject to the conditions set forth herein, Purchaser shall Cellular Business in the Ordinary Course of Business which (i) are reflected on Seller's books and records as of the Date of Closing and (ii) remain unpaid as of the opening of business on the Date of Closing;
(b) All debts, liabilities and obligations of Seller arising under the Operating Contracts (i) which are listed on Schedule 1.1(f) or (ii) which require aggregate annual payments of less than $12,000 and which have a duration of less than one year after the date of this Agreement (provided that the maximum aggregate liability assumed by Purchaser pursuant to this subparagraph (b)(ii), determined as if Purchaser on the date of Closing provided notice of termination to the other parties to all such agreements, shall not exceed $50,000), except that Purchaser does not assume any liabilities for products sold or services rendered in connection with the operation of the Cellular Business under such Operating Contracts prior to the Date of Closing and provided that liabilities assumed hereunder are only assumed to the extent they accrue after the Date of Closing and are not attributable to any default of Seller thereunder except for trade payables assumed pursuant to subsection (a) above;
(c) All amounts accrued as of the close of business on the Date of Closing for wages, salaries and vacation and sick leave, payable to those employees who are employed by Purchaser on the Date of Closing and who will be listed on Schedule 3.2(c), which Schedule will be attached hereto at the Closing (collectively, the "Hired Employees");
(d) Seller's obligation to provide cellular telephone and discharge or perform when due related services to its customers in accordance with the Assumed Liabilities Customer Contracts in effect on and after the Closing Date and (ii) assume all obligations for and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; provided, that, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as set forth in this Section 2.7, Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract in accordance with the terms of this Section 2.7(b). From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned Contract.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.Closing;
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all All liabilities and obligations with respect to of Seller for the Cure Amount relating to any such Ancillary Servicing-Related AgreementAssigned Leases as accrued on and after the Date of Closing; and
(f) all obligations under the FCC Licenses.
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Assumption of Certain Liabilities. Seller shall assume liability effective as of the Closing Date of certain Liabilities of Company relating to those certain Third-Party Claims listed on Schedule 3.4 (a) On the terms “Specified Litigation”), whether such Specified Litigation arises from Third-Party Claims made before or after the Closing Date. If applicable, any Losses incurred by Purchaser or the Company arising from the Specified Litigation shall be handled in accordance with Article VIII. Seller shall defend, with counsel reasonably satisfactory to Purchaser, at the sole cost and expense of and subject Seller, all Specified Litigation by all appropriate proceedings, which proceedings will be diligently prosecuted or defended by Seller to a final conclusion or will be settled at the conditions set forth herein, discretion of Seller (but only with the prior written consent of Purchaser shall in its sole discretion in the case of any settlement (i) assume at that provides for any relief other than the Closing and discharge or perform when due the Assumed Liabilities on and after the Closing Date and payment of monetary damages, (ii) assume that provides for the payment of monetary damages by Purchaser or its Affiliates, (iii) that does not expressly unconditionally release Purchaser from all Liabilities with respect to such claim and all other claims arising out of the same or similar facts and circumstances, with prejudice, or (iv) that could adversely affect any Tax or other Liability of Purchaser and its Affiliates). Subject to the immediately preceding sentence, Seller will have full control of such defense and proceedings, including any compromise or settlement thereof. If requested by Seller, Purchaser will, at the sole cost and expense of Seller, provide reasonable cooperation to Seller in contesting the Specified Litigation. Seller hereby guarantees timely payment and performance by Seller of all obligations for of Seller described in this Section 3.4(b) and pay and discharge when due the Cure Amounts relating to each Assigned Contract at the respective Contract Determination Date for such Assigned Contract; providedshall fulfill, thaton demand, except as set forth in Section 2.7(b), in no event shall Purchaser assume and discharge when due the Cure Amounts relating to the Excluded Contracts. Except as all obligations of Seller set forth in this Section 2.73.4(b) if Seller fails to do so. If applicable, any Losses incurred by Purchaser shall not assume or have any Liability or responsibility with respect to any Liability of any nature or kind whatsoever relating to the Business or the Purchased Assets that exists, or arises out of Company arising from the operation or ownership of the Purchased Assets or the Business, prior to, at or after, the Closing and that is not an Assumed Liability. Except as set forth in this Section 2.7, other than the Assumed Liabilities, Purchaser shall not assume any Liability of any nature or kind whatsoever of Sellers.
(b) From time to time after the date hereof, but in no event later than 60 days following the Closing Date or, if such date does not fall on a Business Day, the next succeeding Business Day (the “Contract Notification Deadline”), Purchaser shall, in its sole discretion, notify Sellers of (i) each Assigned Contract that Purchaser has agreed to assume (each, an “Accepted Contract” and, collectively, the “Accepted Contracts”) and (ii) each Assigned Contract that Purchaser does not desire to assume (each, an “Excluded Contract” and, collectively, the “Excluded Contracts”); provided, that any Assigned Contract that has not been designated by Purchaser as either an Accepted Contract or an Excluded Contract by the Contract Notification Deadline Specified Litigation shall be deemed to be an Excluded Contract; and provided, further, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for and shall pay to each applicable Person that is a party to an Accepted Contract the respective Cure Amount for such Accepted Contract on the Contract Determination Date for such Accepted Contract. In furtherance of the foregoing, the Sale Approval Order shall provide that the assignment and assumption to Purchaser of the Assigned Contracts is approved, subject only to (A) payment by Purchaser of the Cure Amounts for each Assigned Contract, (B) resolution of any assumption objection under Section 365(c)(1) or (c)(2) of the Bankruptcy Code and (C) Purchaser’s right to designate any Assigned Contract an Excluded Contract handled in accordance with the terms of this Section 2.7(b)Article VIII. From the date hereof until the Contract Notification Deadline, Sellers shall not reject any Assigned Contract unless such contract has been designated an Excluded Contract by Purchaser; provided, that Sellers shall not be deemed in breach under this Agreement (whether as a result of an inaccuracy in a representation or warranty or breach of a covenant) or otherwise if Sellers shall reject an Excluded Contract. Purchaser shall be responsible for, and shall pay in accordance with Section 2.7(c), all costs incurred by Sellers with respect to, and all amounts due by or on behalf of Sellers under, each Assigned Contract, together with all of Sellers’ reasonable, necessary, ordinary course, post-Closing obligations that are specifically attributable to each such Assigned Contract (the “Carrying Costs”) during the period from the Closing Date through the Contract Determination Date for each such Assigned Contract. Except as set forth in this Section 2.7, Purchaser’s Carrying Costs shall not include any attorneys’ or financial advisory fees arising from and directly related to the Bankruptcy Cases or Sellers and their Affiliates status as debtors-in-possession under Chapter 11 of the Bankruptcy Code. With respect to each Assigned Contract, between the Closing Date and such Assigned Contract’s respective Contract Determination Date, Sellers shall provide, to the extent reasonably necessary for Purchaser to operate the Business after the Closing Date and at Purchaser’s sole cost and expense, a subcontract, sublease or sublicense, as may be applicable, to Sellers’ rights Related to the Business pursuant to such Assigned ContractARTICLE IV.
(c) With respect to each Assigned Contract, Sellers shall, within 60 days after the later of (i) the Contract Determination Date for such Assigned Contract or (ii) the Contract Notification Deadline, advise Purchaser in writing of the amount of the Carrying Costs with respect to such Assigned Contract in sufficiently reasonable detail; provided, that, without limiting the foregoing, Sellers, in their sole discretion, may advise Purchaser in writing of the amount of Carrying Costs at any time with respect to any Assigned Contract the Carrying Costs of which are equal to or greater than $100,000. Purchaser shall pay the Carrying Costs as so indicated within 10 Business Days after such notification; provided, that Purchaser may object to the Carrying Costs within such 10 Business Day period. If Purchaser makes such an objection, Sellers and Purchaser shall first use good faith efforts to resolve such objection and, absent resolution within 10 Business Days of Purchaser’s objection, the matter shall be submitted to the Bankruptcy Court, whose determination shall be final and binding upon the parties.
(d) Sellers shall file a motion (the “Supplemental Motion”) with the Bankruptcy Court for entry of an Order of the Bankruptcy Court (the “Supplemental Order”) to assume and assign to Purchaser any additional Contracts or any Separation Shared Contracts, in each case that have not been previously rejected by Sellers, as identified by Purchaser and approved by Sellers in their sole discretion (each, an “Additional Contract” and, collectively, the “Additional Contracts”) that, for any reason, are not assumed and assigned to Purchaser pursuant to the Sale Approval Order, with the same effect as if such Contracts had been Assigned Contracts (i) under the Sale Approval Order, including setting a proposed cure amount and seeking a Cure Finding therefor, and (ii) under this Section 2.7, including with respect to the obligation to pay the Cure Amount and Carrying Costs with respect to each such Additional Contract; provided, that Purchaser’s obligation to pay the Carrying Costs for any Additional Contract shall commence upon the date that Sellers approve Purchaser’s request to treat such contract as an Additional Contract hereunder. The Sale Approval Order shall provide that a motion to assume and assign an Additional Contract shall be on notice only to Purchaser and to the non-debtor party or parties to such Contract. If the non-debtor party to any such Additional Contract objects to the assumption and assignment of such Contract or to Sellers’ proposed cure amount, then Sellers shall either settle, at Purchaser’s cost, the objection of such party (subject to approval of Purchaser) or shall litigate, at Purchaser’s cost, such objection under such procedures as the Bankruptcy Court shall approve and proscribe. The Contract Notification Deadline for any Additional Contract shall be deemed to be, and shall be extended until, the later of (x) the date that is 45 days after the date that such Additional Contract is identified by Purchaser to Sellers, subject to the approval of Sellers in their sole discretion; and (y) the date that is three Business Days after the date that the Bankruptcy Court makes a Cure Finding for such Contract (in each case if such date would be after the date that would otherwise be the Contract Notification Deadline). The Sale Approval Order shall provide that with respect to any action required or permitted to be taken by Sellers pursuant to this Section 2.7(d), Purchaser shall pay the legal fees of Sellers involved in any such litigation.
(e) Prior to the Closing Date, Sellers shall file a Supplemental Motion with the Bankruptcy Court for entry of a Supplemental Order to assume and assign to Purchaser any Ancillary Servicing-Related Agreements that have not otherwise been assumed by Sellers and assigned to Purchaser by agreement of the parties thereto in accordance with the terms of the Sale Approval Order. Sellers shall retain all liabilities and obligations with respect to the Cure Amount relating to any such Ancillary Servicing-Related Agreement.
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