EXHIBIT 2.11 AMENDED AND RESTATED ASSET PURCHASE AGREEMENT, DATED AS OF MAY 14,
2003, BY AND AMONG JPE, INC., PLASTIC TRIM, INC. AND PTI ACQUISITION, LLC
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AMENDED AND RESTATED
ASSET PURCHASE AGREEMENT
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BY AND AMONG
PTI ACQUISITION, LLC
PLASTIC TRIM, INC.
AND
JPE, INC.
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TABLE OF CONTENTS
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Article I CERTAIN DEFINITIONS....................................................................... 1
Article II PURCHASE AND SALE OF THE PURCHASED ASSETS................................................. 3
2.1 Purchased Assets.......................................................................... 3
2.2 Excluded Assets........................................................................... 4
Article III PURCHASE PRICE............................................................................ 5
3.1 Purchase Price............................................................................ 5
3.2 Assumption of Liabilities................................................................. 5
3.3 Excluded Liabilities...................................................................... 5
3.4 Allocation of Purchase Price and Assumed Liabilities...................................... 6
3.5 Closing Date Balance Sheet................................................................ 7
3.6 Post-Closing Adjustment................................................................... 8
Article IV COVENANT NOT TO COMPETE................................................................... 8
Article V REPRESENTATIONS AND WARRANTIES OF THE SELLERS............................................. 9
5.1 Organization and Qualification............................................................ 9
5.2 No Conflicts.............................................................................. 9
5.3 Subsidiaries.............................................................................. 10
5.4 Compliance with Laws...................................................................... 10
5.5 Litigation................................................................................ 10
5.6 Financial Statements...................................................................... 10
5.7 Accounts Receivable and Inventory......................................................... 10
5.8 Real Property............................................................................. 11
5.9 Personal Property......................................................................... 11
5.10 List of Contracts......................................................................... 11
5.11 Contracts................................................................................. 12
5.12 Insurance................................................................................. 12
5.13 Trademarks and Intellectual Property...................................................... 12
5.14 Tax Matters............................................................................... 12
5.15 Employee Benefits......................................................................... 13
5.16 Labor Matters............................................................................. 14
5.17 Affiliated Agreements..................................................................... 14
5.18 Environmental Matters..................................................................... 14
5.19 Absence of Certain Changes and Events..................................................... 15
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5.20 Product Design; Warranties................................................................ 15
5.21 Brokers................................................................................... 15
5.22 Sellers' Knowledge........................................................................ 16
Article VI REPRESENTATIONS AND WARRANTIES OF BUYER................................................... 16
6.1 Organization and Qualification............................................................ 16
6.2 Power and Authorization................................................................... 16
6.3 No Conflicts.............................................................................. 16
6.4 Financial Condition....................................................................... 17
6.5 WARN Act.................................................................................. 17
6.6 Investigation and Evaluation.............................................................. 17
6.7 Brokers................................................................................... 17
Article VII PRE-CLOSING COVENANTS..................................................................... 18
7.1 Sellers' Covenants........................................................................ 18
7.2 Publicity................................................................................. 19
7.3 Cooperation and Best Efforts.............................................................. 20
7.4 Employee Arrangements..................................................................... 20
7.5 Exclusive Negotiation Provision........................................................... 21
Article VIII POST-CLOSING COVENANTS.................................................................... 21
8.1 Books and Records......................................................................... 21
8.2 Compliance with WARN Act.................................................................. 22
8.3 Transition................................................................................ 22
8.4 Internal Revenue Service Forms............................................................ 22
Article IX CONDITIONS PRECEDENT TO THE BUYER'S PERFORMANCE........................................... 22
9.1 Accuracy of Representations and Warranties; Performance by Sellers........................ 22
9.2 Closing Deliveries........................................................................ 23
9.3 Absence of Litigation..................................................................... 23
9.4 Consents.................................................................................. 23
9.5 Satisfaction of Outstanding Indebtedness.................................................. 23
Article X CONDITIONS PRECEDENT TO THE SELLERS' PERFORMANCE.......................................... 23
10.1 Accuracy of Representations and Warranties; Performance by Buyer.......................... 23
10.2 Shareholder Consent....................................................................... 23
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TABLE OF CONTENTS
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10.3 Closing Deliveries........................................................................ 23
10.4 Absence of Litigation..................................................................... 24
10.5 Consents.................................................................................. 24
Article XI THE CLOSING............................................................................... 24
11.1 The Closing............................................................................... 24
11.2 Deliveries at the Closing................................................................. 24
Article XII TERMINATION............................................................................... 26
12.1 Termination............................................................................... 26
12.2 Rights Not Impaired....................................................................... 26
12.3 Procedure for Termination................................................................. 27
Article XIII INDEMNITY................................................................................. 27
13.1 Indemnification of Buyer.................................................................. 27
13.2 Indemnification of Seller................................................................. 28
13.3 Indemnification Procedures................................................................ 28
13.4 Recovery of Costs; Limitation of Damages.................................................. 29
13.5 Disclaimer of Warranties.................................................................. 30
Article XIV MISCELLANEOUS............................................................................. 30
14.1 Survival of Representations and Warranties................................................ 30
14.2 Counterparts.............................................................................. 30
14.3 Assignment................................................................................ 31
14.4 Fees and Expenses......................................................................... 31
14.5 Notices................................................................................... 31
14.6 Governing Law............................................................................. 32
14.7 Further Actions and Assurances............................................................ 32
14.8 Effect of Headings........................................................................ 32
14.9 Severability.............................................................................. 32
14.10 Representations........................................................................... 32
14.11 Entire Agreement; Modification; Waiver.................................................... 33
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AMENDED AND RESTATED
ASSET PURCHASE AGREEMENT
This Amended and Restated Asset Purchase Agreement ("Agreement") is
made and entered into this 14th day of May 2003 by and among PTI Acquisition,
LLC, an Ohio limited liability company ("Buyer"), Plastic Trim, Inc., an Ohio
corporation ("PTI" or "Company"), and JPE, Inc., a Michigan corporation ("JPE"
or "Shareholder"). PTI and JPE are sometimes individually referred to in this
Agreement as a "Seller" and collectively as "Sellers".
WHEREAS, Shareholder owns one hundred percent (100%) of the issued and
outstanding shares of capital stock of the Company;
WHEREAS, Company and Shareholder desire to sell to Buyer, and Buyer
desires to purchase from Company and Shareholder, substantially all of the
assets of Company and certain assets of Shareholder used in the business of
Company; and
WHEREAS, Buyer and Sellers entered into an Asset Purchase Agreement
dated as of April 28, 2003 (the "Original Purchase Agreement") and now desire to
amend and restate such agreement.
NOW THEREFORE, in consideration of the foregoing premises and the
mutual covenants, agreements, representations and warranties herein contained,
and for other valuable consideration the receipt and sufficiency of which are
hereby acknowledged, Buyer and Sellers do hereby agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
As used in this Agreement, the following terms have the following
meaning unless the context requires otherwise:
"AUTHORIZATION" means any consent, license, permit, franchise, grant or
authorization of any Governmental Authority.
"BUYER DISCLOSURE STATEMENT" means the disclosure statement delivered
to Sellers by Buyer in connection with the transactions contemplated by this
Agreement.
"BUYER TRANSACTION DOCUMENTS" mean the agreements, instruments and
documents required to be delivered by Buyer in connection with the transactions
contemplated by this Agreement.
"CLOSING" means the consummation of the transactions described in
Article II of this
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Agreement in accordance with Article XI of this Agreement.
"CLOSING DATE" means the date defined in Section 11.1 of this
Agreement.
"COMPANY TRANSACTION DOCUMENTS" means the agreements, instruments and
documents required to be delivered by the Company in connection with the
transactions contemplated by this Agreement.
"CONTRACT" means any contract, agreement, license, lease, understanding
or arrangement or other legally binding contractual right or obligation (whether
written or oral).
"DISCLOSURE STATEMENT" means the disclosure statement delivered to
Buyer by the Sellers in connection with this Agreement.
"ENCUMBRANCE" means any restriction, mortgage, deed of trust, pledge,
lien, option, right of first refusal, security interest or other similar charge,
claim or encumbrance, including any restriction on use, transfer, voting,
receipt of income or other attribute of ownership.
"ENVIRONMENTAL HEALTH AND SAFETY LAWS" means the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, the Resource
Conservation and Recovery Act of 1976 and the Occupational Safety and Health Act
of 1970, each as amended, together with all other Laws concerning pollution or
protection of the environment, public health and safety or employee health and
safety, including Laws relating to emissions, discharges, releases or threatened
releases of pollutants, contaminants or Hazardous Substances into ambient air,
surface water, ground water or lands, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants or chemical, industrial, Hazardous
Substances or wastes.
"ERISA AFFILIATE" means any entity under common control with the
Company, within the meaning of Sections 414(b), 414(c), 414(m) or 414(o) of the
Code (as herein defined) or Section 4001(b) of ERISA (as herein defined).
"GOVERNMENTAL AUTHORITY" means any federal, state, local or other
governmental authority, or any political subdivision thereof, and any
governmental, judicial, public or statutory instrumentality, tribunal, agency,
authority, body or entity having legal jurisdiction over any matter or Person in
question.
"HAZARDOUS SUBSTANCE" means (i) any substance designated or listed as a
"hazardous substance" under Section 101(14) of the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980 or the regulations adopted
pursuant thereto; (ii) any substance designated or listed as a "hazardous
substance" under Sections 307 or 311 of the Clean Water Act or the regulations
adopted pursuant thereto; or (iii) any substance defined, designated or listed
as a "hazardous waste" under Section 1004(5) of the Resource Conservation and
Recovery Act or the regulations adopted pursuant thereto.
"LAW" means any ordinance, regulation, decree, order, statute,
regulation, permit,
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license or certificate, or any judgment, order or award, of any court or other
Governmental Authority.
"MATERIAL" OR "MATERIALLY" as used in Sections 9.1, 10.1 and 12.1(c),
(d) and (e) means, in respect to representations, warranties or covenants that
the falsity or breach thereof would reasonably be likely to result in Damages
(as defined in Section 13.1) to the party who did not make the false
representations or warranties or breach the covenants in excess of $250,000 in
the aggregate.
"MATERIAL CONTRACT" means any Contract to which a Seller is a party
that is included in the Purchased Assets and either which, in the reasonable
expectation of the Sellers, could involve future payments in excess of $100,000
per annum or which is not terminable upon not more than thirty (30) days notice
without payment of premium or penalty by a Seller in an amount in excess of
$50,000.
"PERSON" means an individual, corporation, partnership (limited or
general), association, limited liability company, joint stock company, trust,
estate, unincorporated organization or court or other Governmental Authority or
any agency or subdivision thereof, or any other legally recognizable entity.
"SHAREHOLDER TRANSACTION DOCUMENTS" means the agreements, instruments
and documents required to be delivered by Shareholder in connection with the
transactions contemplated by this Agreement.
"TAXES" means any federal, state, county, local or foreign taxes,
charges, fees, levies, or other assessments, including all net income, gross
income, sales and use, ad valorem, transfer, gains, profits, excise, franchise,
real and personal property, gross receipts, capital stock, production, business
and occupation, disability, employment, payroll, license, estimated, stamp,
custom duties, severance or withholding taxes or charges imposed by any
Governmental Authority, and includes any interest and penalties (civil or
criminal) on or additions to any such taxes.
"TAX RETURN" means a report, return or other information required to be
supplied periodically to a Governmental Authority with respect to Taxes.
"TRANSACTION DOCUMENT(S)" means one or more Buyer Transaction Document,
Company Transaction Document or Shareholder Transaction Document, as applicable.
ARTICLE II
PURCHASE AND SALE OF THE PURCHASED ASSETS
2.1 PURCHASED ASSETS. Subject to the terms and conditions set
forth in this Agreement, at the Closing, Sellers shall sell, convey, assign and
transfer to Buyer, and Buyer shall purchase from Sellers, all right, title and
interest of Sellers in and to all of the assets of
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Sellers, wherever located, except the Excluded Assets (collectively, the
"Purchased Assets"), including, but not limited to, the following assets,
properties and rights:
(a) all raw material, work in process and finished goods
inventory;
(b) all accounts receivable;
(c) the machinery, equipment, vehicles, furniture and
fixtures, and the supplies and spare parts related thereto, as set forth on
Section 2.1 of the Disclosure Statement, subject to any changes in such items as
shall occur in the ordinary course of business between the date hereof and the
Closing;
(d) all of the leasehold and ownership interests, as
applicable, of the Sellers in the real property listed in Section 5.8 of the
Disclosure Statement;
(e) all Contracts entered into by Sellers, including, but
not limited to, those described in Schedule 5.10 of the Disclosure Statement;
(f) the Authorizations of the Sellers listed in Sections
5.4 and 5.18 of the Disclosure Statement;
(g) all existing records, books, ledgers, files,
documents, correspondence, advertising, promotional and marketing materials,
studies and reports relating to the operation of the business of the Company,
including Detroit Red Wings season ticket rights of Sellers; and
(h) all patents, trademarks and tradenames, including,
but not limited to, Plastic Trim and Starboard Industries, owned by the Sellers.
2.2 EXCLUDED ASSETS. Expressly excluded from the Purchased Assets
sold by Seller to Buyer pursuant to Section 2.1 hereof are the following assets
of the Seller (collectively, the "Excluded Assets"):
(a) all cash, investment securities, bank accounts, safe
deposit boxes, prepaid insurance and the capital stock of PTI;
(b) all claims for income tax refunds to the extent such
refunds relate to periods ending on or prior to the Closing;
(c) all corporate seals, articles of incorporation,
minute books, stock books, tax returns and other records having to do with the
corporate organization and capitalization of a Seller and any predecessor
organizations;
(d) all rights that accrue or will accrue to the Sellers
under this Agreement;
(e) any receivable of Company from Shareholder or ASC,
Incorporated or Shareholder from Company or ASC, Incorporated;
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(f) any assets of JPE that do not relate to the Company
or its business, including, without limitation, any rights or interests of JPE
in connection with the sale of assets and stock of its former subsidiary, Dayton
Parts, Inc. ("Dayton Parts"), the capital stock of JPE Finishing, Inc. and any
assets used by JPE in running the holding company and not used in the business
of the Company;
(g) any agreements between JPE and employees on JPE's
payroll and any agreements between JPE and any employee on PTI's payroll;
(h) the tradename, trademarks and related intellectual
property rights in respect to the name "JPE", "ASCET", and "ASC Exterior
Technologies"; and
(i) all assets, properties and rights, if any, listed on
Schedule 2.2(i).
ARTICLE III
PURCHASE PRICE
3.1 PURCHASE PRICE. Subject to adjustment as provided in Section
3.6, the aggregate purchase price paid to Sellers by Buyer for the purchase of
the Purchased Assets shall be Eight Million Seven Hundred Fifty Thousand Dollars
($8,750,000). One Million Dollars ($1,000,000) of the Purchase Price (the
▇▇▇▇▇▇▇ Money Deposit") was, contemporaneously with the execution of the
Original Purchase Agreement, deposited by Buyer with Standard Federal Bank to be
held in escrow in accordance with the terms of an escrow agreement executed
April 28, 2003 and disbursed as follows: (i) if the Closing occurs, shall be
retained in escrow as set forth below; (ii) if this Agreement is terminated as
provided in Section 12.1(a), (b), (c), (e) or (f) shall be paid to Buyer; and
(iii) if this Agreement is terminated as provided in Section 12.1(d), shall be
paid to Sellers. The Purchase Price shall be paid in cash to Sellers by Buyer on
the Closing Date by wire transfer of immediately available funds to an account
designated by Sellers. Buyer and Sellers shall give instructions to the escrow
agent consistent with the provisions of this paragraph. The ▇▇▇▇▇▇▇ Money
Deposit (the "Purchase Price Escrow Amount") shall be retained in the escrow
account (the "Purchase Price Adjustment Escrow") with Standard Federal Bank and
disbursed in accordance with Section 3.6(a) below.
3.2 ASSUMPTION OF LIABILITIES. At the Closing, Buyer shall assume
and agree to pay, discharge or perform, as appropriate, all of the liabilities
and obligations of the Sellers relating to the operation of the business of
Company (whether incurred by JPE or PTI), except for Excluded Liabilities
(defined below) (collectively, the "Assumed Liabilities").
3.3 EXCLUDED LIABILITIES. Buyer shall not assume or become
responsible for any of the following liabilities or obligations of the Sellers
(collectively, the "Excluded Liabilities"), whether accrued, absolute or
contingent and Sellers shall be responsible for the Excluded Liabilities:
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(a) any liabilities and obligations for taxes of Sellers
or any subsidiary or parent entity of Sellers, except to the extent included in
the determination of Certified Net Working Capital (as herein defined);
(b) any liabilities and obligations that accrue or will
accrue to the Sellers under this Agreement;
(c) any liabilities and obligations to any Person in
respect to indebtedness for money borrowed;
(d) any liabilities and obligations that arise under
ERISA (as herein defined) as a result of Sellers being an ERISA Affiliate of
certain other Persons and that do not relate to actions or omissions of the
Company;
(e) any final payment obligations of Sellers to MB
Associates or its owners, Sellers agreeing to make such payment
contemporaneously with Closing;
(f) any obligations (i) to those sixteen salaried
employees of Sellers that Buyer indicated in a letter to Sellers dated May 1,
2003 that it will not hire ("Terminated Employees") and does not hire within six
months of Closing, and (ii) for any payments in connection with a
change-in-control of Sellers, including, but not limited to, completion bonus
payments or bonus awards;
(g) any liabilities of JPE that do not relate to the
Company or the Purchased Assets, including, without limitation, any liabilities
relating to Excluded Assets, any liabilities in connection with the sale of
assets and stock of Dayton Parts and any liability to shareholders of JPE;
(h) any liabilities of Company to Shareholder or ASC,
Incorporated or of Shareholder to Company or ASC, Incorporated;
(i) any liability or obligation resulting from a lawsuit
commenced by a third party against (x) a Seller prior to the Closing Date, or
(y) Buyer after the Closing Date, but in the case of (y) only to the extent
relating to a breach by a Seller of an obligation of a Seller in the operation
of the business of the Company prior to the Closing Date; and
(j) any liability of Company to vendors, General Motors
and Sports Carrier Inc. in respect of the GMT 265 program.
3.4 ALLOCATION OF PURCHASE PRICE AND ASSUMED LIABILITIES. The
Purchase Price and the Assumed Liabilities shall be allocated among the
Purchased Assets as set forth on Schedule 3.4, provided that such allocation
shall be adjusted appropriately to reflect adjustments to the Purchase Price
made pursuant to Section 3.6 below. The allocation determined pursuant to this
section shall be conclusive and binding for all purposes, and each party will
file all forms, returns and other documents in a manner consistent with such
allocation.
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3.5 CLOSING DATE BALANCE SHEET.
(a) Within sixty (60) days after the Closing Date,
Sellers shall prepare and deliver, or cause to be prepared and delivered, to
Buyer the balance sheet for the Company as of the close of business on the
Closing Date (the "Closing Date Balance Sheet"), except that the amount of the
unfunded pension liability, if any, ("Unfunded Pension Liability") under the
Plastic Trim, Inc. Hourly Pension Plan ("PTI Pension Plan") shall be determined
as of April 30, 2003. The Closing Date Balance Sheet shall set forth the
consolidated Net Working Capital (as defined below) of the Sellers, and shall be
prepared in accordance with United States generally accepted accounting
principles ("GAAP") used in the preparation of the Historic Financial Statements
(as defined in Section 5.6) of the Sellers, consistently applied, provided that
the amount of the Unfunded Pension Liability as of April 30, 2003 shall be
reasonably determined by the Company actuary using generally accepted actuarial
principles and practices consistent with the requirements of the governing plan
document, the Internal Revenue Code of 1986, as amended, and ERISA (as herein
defined) and consistent with those used in determining the unfunded pension
liability for Sellers' financial statements for the year ended December 31,
2002. For purpose of this Agreement, Net Working Capital shall be defined as set
forth on Schedule 3.5." Buyer shall permit representatives of Sellers that are
employed by Buyer to be reasonably available to Seller to assist Seller in the
preparation of the Closing Date Balance Sheet.
(b) Unless the Buyer within 20 days after receipt of the
Closing Date Balance Sheet gives the Sellers a notice objecting thereto and
specifying the basis for such objection and the amount in dispute ("Notice of
Objection"), such Closing Date Balance Sheet shall be considered accepted and
binding upon the Sellers and Buyer. Sellers shall make available to Buyer during
such 20 day period, at Buyer's written request, the working papers utilized by
Sellers in preparing the Closing Date Balance Sheet. If within 20 days after the
receipt of the Closing Date Balance Sheet, Buyer gives a Notice of Objection to
the Sellers, the Sellers and Buyer shall negotiate in good faith with a view to
resolving any differences. If such negotiations fail to resolve all disputed
items within 15 days after Notice of Objection was first given by Buyer, the
remaining disputed items shall be submitted to Deloitte & Touche or, if such
accounting firm cannot serve for any reason, another recognized accounting firm
reasonably satisfactory to Buyer and Sellers (the "Nonpartisan Accountants") for
final resolution. After affording the Buyer and its representatives and the
Sellers and their representatives the opportunity to present their positions as
to the disputed items (which opportunity shall not extend for more than 30
days), the Nonpartisan Accountants shall resolve all disputed items in writing
in accordance with the terms and conditions of this Agreement. Such resolution
shall be final and binding upon the parties and shall be reflected in any
necessary revisions to the Closing Date Balance Sheet. The fees, costs and
expenses of the Nonpartisan Accountants in connection with any such
determination shall be divided evenly between the Sellers and Buyer. Otherwise,
the Sellers and Buyer shall each pay its costs in connection with this Section,
including the fees and expenses of their respective attorneys and accountants,
if any.
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3.6 POST-CLOSING ADJUSTMENT.
(a) If the Net Working Capital as of the Closing Date as
conclusively determined as provided in Section 3.5 (such conclusive
determination is referred to herein as "Certified Net Working Capital"), is less
than $6,180,000, then Sellers cause the amount of such deficiency to be paid to
Buyer out of the Purchase Price Escrow Amount. The parties acknowledge that
$700,000 was used as the Unfunded Pension Liability amount in computing the Net
Working Capital base amount of $6,180,000 for purposes of this Section as Buyer
is assuming that amount of Unfunded Pension Liability as of the Closing. The
Unfunded Pension Liability is reflected in accounts ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ on
Schedule 3.5. In the event that the Purchase Price Escrow Amount is less than
the amount of the adjustment, if any, payable to Buyer under this Section
3.6(a), Sellers shall pay or cause to be paid, to Buyer the amount of such
deficiency. The positive remainder, if any, of (i) the Purchase Price Escrow
Amount plus any net accrued interest earned on the Purchase Price Escrow Amount,
less (ii) the amount of the adjustment, if any paid to Buyer out of the Purchase
Price Adjustment Escrow under this Section 3.6(a), shall be paid to Sellers. In
the event that no amount is payable to Buyer under this Section 3.6(a), then the
entire Purchase Price Escrow Amount, plus all net accrued interest earned
thereon, shall be paid to Sellers. If the Certified Net Working Capital is
greater than $6,180,000, then Buyer shall pay, or cause to be paid, to Sellers
the amount of such excess. Any payment pursuant to this Section 3.6(a) shall be
made within five (5) business days following the determination of Certified Net
Working Capital (such fifth business day, the "Due Date"). Any payment not made
by the Due Date therefor shall bear interest from the Due Date at the rate of
six percent (6%) per annum. Any amount payable to Buyer under this Section
3.6(a) shall be paid, first, out of the Purchase Price Adjustment Escrow. Buyer
and Sellers shall give instructions to the escrow agent consistent with the
provisions of this paragraph.
(b) Payments made pursuant to this Section 3.6 shall be
made by wire transfer of immediately available funds to an account designated by
the party receiving such payment.
ARTICLE IV
COVENANT NOT TO COMPETE
For a period of one year following the Closing, Sellers shall not
engage in the business of manufacturing or distributing plastic trim side
moldings in the United States or Canada to original equipment manufacturers of
motor vehicles.
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ARTICLE V
REPRESENTATIONS AND WARRANTIES OF
THE SELLERS
Shareholder and the Company hereby represent and warrant to Buyer as of
the date of this Agreement and as of the Closing Date as follows:
5.1 ORGANIZATION AND QUALIFICATION. The Shareholder is duly
organized, validly existing and in good standing under the Laws of the State of
Michigan. The Company is duly organized, validly existing and in good standing
under the Laws of the State of Ohio. Each Seller has all requisite corporate
power and authority to own, operate and lease its assets and properties and to
carry on its business as presently conducted. Each Seller is duly qualified to
do business as a foreign corporation in each jurisdiction set forth beside its
name in Section 5.1 of the Disclosure Statement.
5.2 NO CONFLICTS.
(a) Except as set forth in Section 5.2(a) of the
Disclosure Statement, the execution, delivery and performance of this Agreement
do not and will not:
(i) violate or conflict with the articles of
incorporation or bylaws of either Seller, or
any Law binding upon either Seller;
(ii) violate or conflict with, result in a breach
of or constitute a default or otherwise
cause any loss of benefit under any Material
Contract to which a Seller is a party, or
give to others any rights (including rights
of termination, foreclosure, cancellation or
acceleration) in or with respect to the
Purchased Assets; or
(iii) result in, require or permit the creation or
imposition of any Encumbrance upon or with
respect to the Purchased Assets.
(b) Section 5.2(b) of the Disclosure Statement sets forth
each consent or approval of, or registration, notification, filing and/or
declaration with, any Governmental Authority, creditor, lessor or other Person
required to be given or made by a Seller in connection with the execution,
delivery and performance by Sellers of this Agreement and the Company
Transaction Documents and the Shareholder Transaction Documents (the "Company
Consents"). Except as set forth in Section 5.2(b) of the Disclosure Statement,
all Company Consents have been obtained or made or Company will use reasonable
efforts to have such Company Consents as are indicated on Section 5.2(b) of the
Disclosure Statement obtained or made prior to the Closing.
(c) The Sellers have not received any request from any
Governmental Authority for information with respect to the transactions
contemplated hereby.
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5.3 SUBSIDIARIES. Shareholder's only subsidiaries are the Company
and JPE Finishing, Inc. JPE Finishing, Inc. is not conducting an active
business. The Company has no subsidiaries.
5.4 COMPLIANCE WITH LAWS.
(a) Other than with respect to Environmental Health and
Safety Laws, as to which Sellers represent and warrant to Buyer solely as set
forth in Section 5.18, each Seller is in compliance in all material respects
with all Laws applicable to the conduct of its business.
(b) Other than with respect to Environmental Health and
Safety Laws, as to which Sellers represent and warrant to Buyer solely as set
forth in Section 5.18: (i) each Seller owns, holds, possesses or lawfully uses
in the operation of its business all Authorizations that are necessary for it to
conduct such business, (ii) set forth in Section 5.4 of the Disclosure Statement
is a list of all material Authorizations of Sellers, and (iii) neither Seller is
in default in any material respect, nor has any Sellers received any written
notice of any claim of default, under any Authorization.
5.5 LITIGATION. Except as set forth in Section 5.5 of the
Disclosure Statement, there are no claims, actions, suits, proceedings
(arbitration or otherwise) or investigations involving or affecting either
Seller pending either in court or before any other Governmental Authority, or
before an arbitrator of any kind, which if adversely determined could reasonably
be expected to cause an Encumbrance to be imposed on the Purchased Assets. To
the knowledge of Sellers, no such claim, action, suit, proceeding or
investigation is presently threatened, which if adversely determined could
reasonably be expected to cause an Encumbrance to be imposed on the Purchased
Assets. There are no unsatisfied judgments, penalties or awards against or
affecting the Sellers' assets or properties.
5.6 FINANCIAL STATEMENTS
(a) Section 5.6 of the Disclosure Statement includes the
balance sheet of the Sellers as at February 28, 2003 (the "Balance Sheet") and
the related statement of income for the two (2) months then ended (collectively,
the "Historic Financial Statements"). The Historic Financial Statements fairly
present, in all material respects, the financial condition and results of
operations of the Sellers as of the respective dates thereof and for the periods
therein referred to, all in accordance with GAAP, consistently applied, except
for the omission of footnotes.
(b) The Balance Sheet fairly reflects, as of the date
thereof, all material liabilities of the Sellers of the type required to be
reflected or disclosed in a balance sheet (or the notes thereto) prepared in
accordance with GAAP. The Sellers have no material liabilities of a nature
required to be reflected in a balance sheet prepared in accordance with GAAP
that are not reflected on the Balance Sheet, except for current liabilities
(within the meaning of GAAP) which have been incurred since the date thereof in
the ordinary course of business consistent with past practice.
5.7 ACCOUNTS RECEIVABLE AND INVENTORY.
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(a) All accounts receivable of the Company represent
obligations from sales made or services rendered in the ordinary course of
business. Such receivables, net of reserves for doubtful accounts reflected on
the Balance Sheet, are not, except as set forth in Section 5.7 of the Disclosure
Statement, subject to any valid dispute, counterclaims, encumbrances or setoff
known to the Company, or any other reduction or discount that has been agreed to
by the Company.
(b) The Company has sufficient amounts of saleable
inventory for the conduct of its business in the ordinary course.
5.8 REAL PROPERTY. Section 5.8 of the Disclosure Statement briefly
describes each interest in real property owned or leased by the Company,
including the location thereof (collectively, the "Premises"). Except as set
forth in Section 5.8 of the Disclosure Statement, the Company has good and
marketable title in fee simple to the Premises owned by it, and has all right,
title and interest in all leasehold estates and other rights purported to be
granted to it by the leases and other agreements referred to in Section 5.8 of
the Disclosure Statement, in each case free and clear of any Encumbrances except
for (i) liens for current taxes, assessments and governmental charges and levies
which may be paid without penalty, interest or other additional charge, (ii)
such easements and restrictions, if any, as do not materially detract from the
value or marketability of the property subject thereto and (iii) any
Encumbrances set forth in Section 5.8 of the Disclosure Statement. To the
knowledge of the Company, no building or structure included in the Premises
violates any restrictive covenant or encroaches on any property owned by others,
except for those restrictive covenants and encroachments that could not
reasonably be expected to have a Material Adverse Effect. No condemnation
proceeding is pending or, to the knowledge of the Company, threatened, with
respect to any of the Premises of the Company. The Company has made available to
Buyer true and complete copies of all deeds and other instruments (as recorded)
by which the Company acquired the Premises. To the knowledge of the Company,
except as set forth in the Section 5.8 of the Disclosure Statement or in the
leases and agreements identified therein, there are no lease agreements,
purchase agreements, rights of first refusal, options or other agreements or
commitments in effect conveying to any Person any rights with respect to the
Premises.
5.9 PERSONAL PROPERTY. Each Seller has all right, title and
interest in and to all of its owned personal property included in the Purchased
Assets, including, except as they have since been affected by transactions in
the ordinary course of business, the personal property reflected as being owned
in the Balance Sheet, free and clear of any Encumbrances, except such as are
reflected in the Balance Sheet or Section 5.9 of the Disclosure Statement.
5.10 LIST OF CONTRACTS. Section 5.10 of the Disclosure Statement
sets forth the following:
(i) each Contract of the Company for the
purchase or sale of real property;
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(ii) each Material Contract of the Sellers
included in the Purchased Assets;
(iii) any guarantee by the Sellers of the
obligations of its customers, suppliers,
officers, directors, employees, affiliates
or others;
(iv) any agreement which provides for the
incurrence by the Sellers of indebtedness
for borrowed money; and
(v) any mortgage or other form of secured
indebtedness of the Sellers.
Section 5.10 of the Disclosure Statement also sets forth the primary
terms of all Contracts required to be listed thereon which are not in writing.
5.11 CONTRACTS. Except as set forth in Section 5.11 of the
Disclosure Statement, each Material Contract included in the Purchased Assets to
which a Seller is a party or by which its assets are bound is to the actual
knowledge of the Sellers in full force and effect and is valid, binding and
enforceable against the Seller that is a party thereto in accordance with its
terms. Except as described in Section 5.11 of the Disclosure Statement, each
Seller has performed in all material respects all obligations required to be
performed by it under each such Material Contract included in the Purchased
Assets.
5.12 INSURANCE. The description of the policies and binders of
insurance of the Sellers contained in Section 5.12 of the Disclosure Statement
identifies: (i) the respective issuers and expiration dates thereof; (ii)
deductible amounts and amounts of coverage available and outstanding thereunder;
(iii) whether such policies and binders are "claims made" or "occurrences"
policies, (iv) all self-insurance programs or arrangements and (v) any
retrospective premium adjustments of which the Sellers have knowledge.
5.13 TRADEMARKS AND INTELLECTUAL PROPERTY. Section 5.13 of the
Disclosure Statement sets forth all material patents, tradenames, trademarks,
service marks, brandmarks, brandnames, copyrights or registrations, or other
material intellectual property or licenses thereof or applications therefor or
interests therein, which the Company presently is using (other than commercially
available software). The Company owns or has a valid license to use all of the
technology, manufacturing processes and formulations that are material to its
business as presently conducted. To the knowledge of the Company, the Company is
not violating or infringing, and there is no pending or threatened claim of
violation or infringement by the Company of any industrial property rights,
including without limitation any patents, copyrights, trademarks, tradenames and
trade secrets, owned by any third person.
5.14 TAX MATTERS. All Tax Returns that are due and required to be
filed by, or with respect to, the Company have been filed and will be filed to
the extent required prior to Closing. Payment has been made of all Taxes
required to be paid in respect of the periods covered by such Tax Returns. The
Company is not delinquent in the payment of any Tax, assessment or governmental
charge. There are no Tax liens upon the assets of the Company except liens for
Taxes not yet due or being contested in good faith through appropriate
proceedings. No
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deficiency for any Taxes has been proposed, asserted or assessed against the
Company that has not been resolved or paid in full. No audits or other
administrative proceedings or court proceedings are currently pending with
regard to any material Tax or Tax Returns of the Company. The Company is not a
party to any tax-sharing, allocation or indemnification agreement with any
party.
5.15 EMPLOYEE BENEFITS.
Section 5.15 of the Disclosure Statement identifies each "employee
pension benefit plan" ("Pension Plan"), as defined in Section 3(2) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA") and
"employee welfare benefit plan" ("Welfare Plan"), as defined in Section 3(1) of
ERISA maintained by or on behalf of the Company to provide benefits to employees
of the Company (collectively, "Employee Benefit Plans"). The term "employee
pension benefit plan" includes both funded and unfunded plans and both
tax-qualified and non-qualified pension and deferred compensation plans and
arrangements. In addition, Section 5.15 of the Disclosure Statement identifies
each executive compensation, incentive bonus or other bonus stock options, stock
purchase or severance pay program arrangement, agreement or commitment of
Company (collectively, "Compensation Arrangements").
(a) Except as set forth in Section 5.15 of the Disclosure
Statement, each Employee Benefit Plan and Compensation Arrangement has been
administered in material compliance with its terms and is in material compliance
with the applicable provisions of ERISA (including, without limitation, the
funding and prohibited transactions provisions thereof) and each Pension Plan
that is intended to be qualified under Section 401(a) of the Internal Revenue
Code of 1986, as amended (the "Code") has been administered in material
compliance with the applicable provisions of the Code.
(b) To the knowledge of the Company, there are no
inquiries or proceedings regarding a material amount of assets pending or
threatened by the Internal Revenue Service ("IRS"), the U.S. Department of
Labor, the Pension Benefit Guaranty Corporation, or any participant or
beneficiary, with respect to any Employee Benefit Plan or Compensation
Arrangement now or formerly maintained by the Company or to which the Company
has contributed (other than routine benefit claims of participants and
beneficiaries).
(c) Except as set forth in Section 5.15 of the Disclosure
Statement, the Company is not required to contribute to any "multiemployer
plan", as defined in Section 3(37) of ERISA.
(d) Each Pension Plan which is intended to be qualified
under Section 401(a) of the Code has been determined by the IRS to be so
qualified and, to the knowledge of Company, has not been disqualified.
(e) Except as set forth in Section 5.15 of the Disclosure
Statement, the Company is not bound by any collective bargaining agreement or
legally binding arrangement to maintain or contribute to any Employee Benefit
Plan or Compensation Arrangement. Except as set forth in Section 5.15 of the
Disclosure Statement, no Employee Benefit Plan is subject to the
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minimum funding requirements of Title I, Subtitle B, Part 3 of ERISA or subject
to Section 412 of the Code.
(f) Except as set forth in Section 5.15 of the Disclosure
Statement or as required under applicable law, (i) no Employee Benefit Plan
provides retiree medical benefits to any of its employees or former employees
and (ii) the Company is not contractually or otherwise obligated to provide any
of its employees or former employees with medical benefits upon retirement or
termination of employment.
(g) Complete and correct copies of the following
documents have been made available by the Company to the Buyer: (i) all current
plan documents and insurance contracts (if any), and amendments thereto, with
respect to each of the Employee Benefit Plans or Compensation Arrangement, (ii)
for each of the most recently ended two plan years, all IRS Form 5500 series
forms (and any financial statement and other schedules attached thereto) with
respect to any Employee Benefit Plan, (iii) the most recent IRS determination
letter for each Pension Plan (if any), and (iv) all current summary plan
descriptions and subsequent summaries of material modifications with respect to
each of the Employee Benefit Plans.
5.16 LABOR MATTERS. Except as set forth in Section 5.16 of the
Disclosure Statement, none of the employees of the Company are, or during the
last three years have been, represented by any union or other bargaining
representative, and no application or petition for certification of a collective
bargaining agent at or with respect to the Company is pending. Except as set
forth in Section 5.16 of the Disclosure Statement, to the knowledge of the
Company, during the last three years, no union has attempted to organize any
group of employees of the Company and no such group has sought to organize into
a union or similar organization for the purpose of collective bargaining. Except
as set for on Section 5.16 of the Disclosure Statement, there are no pending
grievances, arbitration proceedings, unfair labor practice charges or other
similar controversies between the Company and any of their respective employees.
5.17 AFFILIATED AGREEMENTS. Except as described in Section 5.17 of
the Disclosure Statement, there are no agreements, arrangements or
understandings between the Company and Shareholder that are included in the
Purchased Assets.
5.18 ENVIRONMENTAL MATTERS. Except as set forth in Section 5.18 of
the Disclosure Statement:
(a) The Company has no knowledge of and has not received
any written notice of violation or other written notification from any
Governmental Authority or any third party alleging that the Company is in
violation of any Environmental, Health and Safety Laws;
(b) The Company is not the subject of any administrative
or judicial proceedings or investigations pursuant to any Environmental, Health
and Safety Laws;
(c) To the knowledge of the Company, the Premises do not
contain any Hazardous Substance that, under any Environmental, Health and Safety
Laws currently in effect: (x) imposes or could reasonably be expected to impose
on any Person liability for removal,
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remediation, or other cleanup, or damage to natural resources; or (y) could
reasonably be expected to result in the imposition of an Encumbrance on the
Premises or any of the assets of the Company;
(d) The Company has not received any request for
information from any Governmental Authority or other Person related to any site
which is, or may be, subject to actions for removal, response, remediation or
cleanup of any Hazardous Substances, including, without limitation, any
information request pursuant to the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, or similar laws of any state or province
where the Company operates; and
(e) The Company has not received any order, demand, or
other claim: (x) for removal, response, remediation or cleanup of any regulated
substances; (y) for damage to natural resources; or (z) for personal injury or
property damage related to the release or discharge of Hazardous Substances.
5.19 ABSENCE OF CERTAIN CHANGES AND EVENTS. Except as set forth in
Section 5.19 of the Disclosure Statement, since the date of the Balance Sheet,
the Company has conducted its business in the usual and ordinary course
consistent with past practice and there has not been any:
(i) material increase in any compensation
payable to any shareholder, director,
officer or employee of the Company;
(ii) adoption of or change in any Employee
Benefit Plan, except as required by Law;
(iii) change in the accounting methods, principles
or practices followed by the Company; or
(iv) agreement, whether or not in writing, to do
any of the foregoing.
5.20 PRODUCT DESIGN; WARRANTIES. Schedule 5.21 includes a copy of
the current standard warranty of the Company and the Company's current warranty
policy with respect to products created, manufactured, sold, distributed or
licensed by the Company, other than any such implied by law. To the knowledge of
the Company, there are no material, manufacturing or other defects, latent or
otherwise, with respect to any such products. Except as described on Schedule
5.21, no products have been sold or distributed by the Company under an
understanding or agreement by the Company that such products are returnable
except pursuant to such warranties.
5.21 BROKERS. No Person acting on behalf of the Sellers or under
the authority of any of the foregoing is or will be entitled to any broker's or
finder's fee or any other commission or similar fee, directly or indirectly,
from any of such parties in connection with any of the transactions contemplated
by this Agreement, other than W.Y. ▇▇▇▇▇▇▇▇ & Company, whose fees and expenses
shall be paid by Seller.
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5.22 SELLERS' KNOWLEDGE. For purposes of this Agreement, "to the
knowledge of the Sellers" or "to the knowledge of the Company" or words of
similar import shall be conclusively deemed to be only that knowledge actually
possessed by ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ (based in Beavercreek facility) and ▇▇▇▇▇▇▇
▇▇▇▇▇. The Sellers shall not be deemed to have actual or constructive knowledge
of any fact, circumstance or occurrence known to any person other than as set
forth in the preceding sentence.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby represents and warrants to Sellers as of the date of this
Agreement and as of the Closing Date as follows:
6.1 ORGANIZATION AND QUALIFICATION. Buyer is duly organized,
validly existing and in good standing under the Laws under which it has been
formed and has all requisite corporate power and authority to own, operate and
lease its assets and properties and to carry on its business as presently
conducted.
6.2 POWER AND AUTHORIZATION. Buyer has full entity right, power
and authority necessary to enter into and perform its obligations under this
Agreement and under the Buyer Transaction Documents. This Agreement has been
and, at the Closing, each Buyer Transaction Document will have been, duly and
validly executed and delivered by Buyer. This Agreement constitutes, and each
Buyer Transaction Document will constitute when executed and delivered by Buyer,
Buyer's legal, valid and binding obligation, enforceable against it in
accordance with its terms.
6.3 NO CONFLICTS.
(a) Except as set forth in Section 6.3(a) of the Buyer
Disclosure Statement, the execution, delivery and performance of this Agreement
and the Buyer Transaction Documents do not and will not:
(i) violate or conflict with the certificate or
articles of incorporation or bylaws of Buyer
or other organizational documents of Buyer,
or any Law binding upon Buyer; or
(ii) violate or conflict with, result in a breach
of, or constitute a default or otherwise
cause any loss of benefit under any material
Contract to which Buyer is a party.
(b) Section 6.3(b) of the Buyer Disclosure Statement sets
forth each consent or approval of, or registration, notification, filing and/or
declaration with, any court or other
- 16 -
Governmental Authority, creditor, lessor or other Person required to be given or
made by Buyer in connection with the execution, delivery and performance of this
Agreement and the Buyer Transaction Documents (the "Buyer Consents"). Except as
set forth in Section 6.3(b) of the Buyer Disclosure Statement, all Buyer
Consents have been obtained or made or Buyer will use reasonable efforts to have
same obtained or made prior to Closing.
(c) There are no actions, proceedings or investigations
pending or, to the knowledge of Buyer, threatened that question any of the
transactions contemplated by, or the validity of, this Agreement or the Buyer
Transaction Documents or which, if adversely determined, would have an adverse
effect upon the ability of Buyer to enter into or perform its obligations under
this Agreement or the Buyer Transaction Documents.
(d) Buyer has not received any request from any
Governmental Authority for information with respect to the transactions
contemplated hereby.
6.4 FINANCIAL CONDITION. Buyer has on hand or has access to the
funds necessary to enable it to consummate the transactions contemplated by this
Agreement. Buyer is not aware of any fact or circumstance that could reasonably
be expected to prevent Buyer from obtaining the funds sufficient to consummate
the transactions contemplated by this Agreement.
6.5 WARN ACT. Buyer does not contemplate any "plant closing" or
"employee layoff," as such terms are used in the Worker's Adjustment and
Retraining Notification Act, as amended (the "WARN Act"), on or before the date
is sixty-one (61) days from and after the Closing Date with respect to any
employee of the Company.
6.6 INVESTIGATION AND EVALUATION. Buyer acknowledges that: (a)
Buyer is experienced in the operation of the type of businesses conducted by the
Company; (b) Buyer and its directors, officers, employees, attorneys,
accountants and advisors have been given the opportunity to (i) examine to the
full extent deemed necessary and desirable by Buyer all books, records and other
information with respect to the Sellers and (ii) visit with each Seller and meet
with its officers and other representatives to discuss the business and the
assets, liabilities, financial condition, cash flow and operations of the
Company; (c) Buyer has taken full responsibility for determining the scope of
its investigations of the Sellers and for the manner in which such
investigations have been conducted, and has made its own independent
examination, investigation, analysis and evaluation of the Sellers, including
Buyer's own estimate of the value of the Purchased Assets; (d) Buyer is fully
capable of evaluating the adequacy and accuracy of the information and material
obtained by Buyer in the course of such investigations; and (e) Buyer has not
relied on the Sellers with respect to any matter in connection with Buyer's
evaluation of the Sellers, other than the representations and warranties of
Sellers specifically set forth in Article V hereof.
6.7 BROKERS. No Person acting on behalf of Buyer or any of its
affiliates or under the authority of any of the foregoing is or will be entitled
to any brokers' or finders' fee or any other commission or similar fee, directly
or indirectly, from any of such parties in connection with any of the
transactions contemplated by this Agreement.
- 17 -
ARTICLE VII
PRE-CLOSING COVENANTS
7.1 SELLERS' COVENANTS. Sellers covenant as follows:
(a) Buyer's Access to Premises and Information. Buyer and
its representatives shall, prior to Closing, have reasonable access during
normal business hours to the properties and business and the books and records
of the Sellers to the extent pertaining to the business of the Company and the
Purchased Assets. The Sellers shall furnish, or cause to be furnished, Buyer
with such financial and operating data and other information as to the business
and properties of the Sellers to the extent pertaining to the business of the
Company and the Purchased Assets as Buyer shall from time to time reasonably
request and as are reasonably available to the Sellers, including, but not
limited to, the audited financial statements of JPE as at and for the 12 months
ended December 31, 2002. Buyer acknowledges that certain of the information
which may be made available to it is proprietary and includes confidential
information. Buyer agrees that all information provided or made available to it
or any of its representatives will be subject to the Confidentiality Agreement
dated April 7, 2003 between ▇.▇. ▇▇▇▇▇▇▇▇ and W.Y. ▇▇▇▇▇▇▇▇ & Company
("Confidentiality Agreement") which agreement shall remain in full force and
effect.
(b) Conduct of Business in Normal Course. Until the
Closing, the Sellers shall carry on their business and activities only in the
ordinary course, except Sellers may terminate such employees as Buyer has
notified Sellers it will not hire as referred to in Section 7.4(a).
(c) Maintenance of Facilities and Assets. Until the
Closing, the Sellers shall maintain the Purchased Assets and facilities operated
by Company in substantially the same state of repair, order and condition as
they were in as the date hereof, reasonable wear and tear excepted.
(d) Preservation of the Business. Until the Closing, the
Company shall use reasonable efforts to preserve its business, business
relationships and goodwill.
(e) Maintenance of Insurance. Until the Closing, the
Sellers shall maintain insurance relating to the Company's business in the
amounts and with the coverages described in Section 5.12 of the Disclosure
Statement, subject to variations in amounts required by the ordinary operations
of such businesses, and will pay all premiums thereon when due.
(f) Further Covenants. Except as expressly provided
herein, between the date hereof and the Closing, except as may otherwise be
consented to by Buyer, each Seller shall:
(i) not subject any of the Purchased Assets to
any Encumbrance, other than Encumbrances
disclosed in the Disclosure Statement, or
dispose of any material assets other than
inventory sold or used,
- 18 -
accounts receivable collected upon and
supplies used, in each case in the ordinary
course of business consistent with past
practice, and other than assets not used or
useful in the conduct of its business;
(ii) maintain its books and records on a basis
consistent with prior practice and the
provisions herein;
(iii) not:
(1) amend its articles of incorporation
or bylaws in a manner that could prevent the
consummation of the transactions contemplated hereby;
or
(2) fail to pay or discharge, in a
manner consistent with past practice, any of its
liabilities or obligations.
(iv) comply in all material respects with all
Laws and perform its contractual obligations
without default in any material respect,
other than matters contested in good faith;
and
(v) cooperate with Buyer in obtaining all
necessary consents and approvals required in
connection with the transactions
contemplated hereby.
(g) Union Contract. Company shall permit Buyer to attempt
to negotiate with union leadership of the union which represents certain
employees of Company an amendment to the current union contract, provided that
such negotiation shall only take place in the presence of a representative of
Company and only in accordance with an agenda agreed upon by Company. Any
amendment that is agreed upon with union leadership shall only be presented to
union membership for ratification on and after the date Buyer's right to
terminate this Agreement under Section 12.1(e)(i) expires. Anything herein to
the contrary notwithstanding, union leadership agreeing to an amendment or union
membership ratifying any amendment shall not be a condition to Closing
hereunder, and Buyer may not terminate this Agreement if no such amendment is
agreed upon.
7.2 PUBLICITY. Buyer, on the one hand, and Sellers, on the other
hand, shall not, except to the extent required by Law or the rules of any
securities exchange on which a party's or its affiliates' securities are traded,
make any public announcement (whether written or oral) or notice to the press
relating to any transaction contemplated by this Agreement without the prior
approval of the other party hereto, which approval shall not be unreasonably
withheld. In the case of any public announcement or other disclosure required by
Law or the rules of any securities exchange on which a party's or its
affiliates' securities are traded, each party shall, insofar as is practicable,
consult with the other party prior to any such disclosure, but the other party's
approval shall not be required.
- 19 -
7.3 COOPERATION AND BEST EFFORTS. Each party hereto agrees to
cooperate with the others in the performance of all obligations under this
Agreement and to use its reasonable best efforts to fulfill its obligations
under this Agreement, and to satisfy or cause to be satisfied, at or before the
Closing, the conditions to its performance under this Agreement that are under
its control.
7.4 EMPLOYEE ARRANGEMENTS.
(a) Effective as of the Closing Date, Buyer shall offer
employment with Buyer to all of the employees of the Company except that Buyer
may refuse to offer employment to the Terminated Employees. A list of Company's
employees, their titles, full or part time status and compensation method (i.e.
salaried, hourly union or hourly non-union) as of the date hereof is set forth
on Schedule 7.4(a). The Company shall provide Buyer with an updated Schedule
7.4(a) at the Closing which shall reflect all changes in such employees that
occur between the date hereof and the Closing. Any offer of employment to such
employees by Buyer shall, subject to Section 8.2, not be construed to limit the
ability of Buyer to terminate any such employee at any time for any reason.
Except as otherwise expressly contemplated by this Section 7.4, and except with
respect to annual or hourly compensation, all such offers of employment pursuant
to this Section 7.4(a) shall be for employment on terms and conditions
(including severance) which, taken in the aggregate, are substantially
comparable to the terms and conditions of employment currently in effect for
such employees. Each such employee who accepts, as of the Closing Date, such
offer of employment shall hereinafter be referred to as a "Transferred
Employee."
(b) (i) This subsection (i) shall apply to non-tax
qualified employee benefit plans. On and after the Closing Date, Buyer shall
provide the Transferred Employees with substantially similar employee benefits,
taken in the aggregate, as such employees were receiving as pre-Closing
employees of Company (the "Buyer's Employee Benefits"), and shall credit the
Transferred Employees for service with the Seller for purposes of eligibility
and vesting under all of the Buyer's Employee Benefits to the extent that such
service credit is applicable. No exclusions for pre-existing conditions shall
apply to any disability or medical benefit plan for which Transferred Employees
may otherwise be eligible. Except as otherwise expressly provided in this
Section 7.4, the Company, effective as of the Closing, shall give notice to all
Transferred Employees that no additional benefits shall accrue under the
Company's employee benefit plans and that the Transferred Employees will
commence participation in the Buyer's employee benefit plans.
(ii) This subsection (ii) shall apply to
tax-qualified employee benefit plans. Company is the sponsor of the Plastic
Trim, Inc. Hourly Employees 401(k) Plan ("PTI's 401(k) Plan") and the PTI
Pension Plan. Effective as of the Closing Date, Buyer and Company shall take
such actions as are necessary to cause Buyer to assume sponsorship of PTI's
401(k) Plan and PTI's Pension Plan, together with the related trusts. All PTI's
401(k) Plan and PTI's Pension Plan assets and liabilities shall be transferred
to Buyer in accordance with the requirements of applicable law.
To the extent any Transferred Employee is
not a member of the
- 20 -
International Union, United Automobile, Aerospace and Agricultural Implement
Workers of America, Local Union 888 and is a participant in the JPE, Inc. 401(k)
Savings Plan, Buyer shall allow any such Transferred Employee to "roll over"
such employee's vested account balance (including any outstanding loans in such
account) in the JPE, Inc. 401(k) Savings Plan to a tax qualified 401(k) plan to
be established by Buyer, in which such Transferred Employees shall be eligible
to participate ("Buyer's 401(k) Plan"). Buyer's 401(k) Plan shall provide
substantially similar benefits, and have substantially similar terms and
conditions, as the JPE, Inc. 401(k) Savings Plan. Buyer's 401(k) Plan shall
credit any such Transferred Employee for service with the Sellers for purposes
of eligibility and vesting. Buyer shall establish Buyer's 401(k) Plan as of the
Closing Date.
7.5 EXCLUSIVE NEGOTIATION PROVISION. Until such time, if any, as
this Agreement is terminated pursuant to Article XII, Sellers will refrain from
negotiations with any potential buyer of all or substantially all of the stock
or assets of Company. Notwithstanding the foregoing, if (A) a Seller receives an
unsolicited bona fide proposal in writing by any Person relating to a purchase
of all or substantially all of the stock or assets of a Seller ("Competing
Transaction"), (B) the Board of Directors of JPE, after duly considering the
advice of outside legal counsel to JPE, determines in good faith that the
failure to negotiate with or enter into a letter of intent or other transaction
agreement with such a Person regarding a Competing Transaction would be
reasonably likely to constitute a breach of its fiduciary duties to stockholders
imposed by applicable Law, (C) JPE notifies Buyer in writing that it intends to
take such action, (D) in the event that JPE proposes to enter into a transaction
agreement with respect to such Competing Transaction, JPE attaches the most
current version of such agreement to such notice, and (E) Buyer does not make,
within 96 hours of receipt of JPE's written notification of its intention to
take such action, a written offer that is at least as favorable, from a
financial point of view (after considering all of the terms of such Competing
Transaction) to the stockholders of JPE as such Competing Transaction, as
determined in good faith by the Board of Directors of JPE after duly considering
the advice of JPE's investment bankers, JPE may terminate this Agreement upon
written notice to Buyer and payment to Buyer of a breakup fee equal to $437,500
plus actual documented out of pocket expenses of up to $150,000. Upon such
termination, neither the Sellers on the one hand nor the Buyer on the other hand
shall have any further right or obligation to the other (under Article XII
hereof or otherwise), except that Buyer shall continue to be bound by the
non-disclosure terms of the Confidentiality Agreement.
ARTICLE VIII
POST-CLOSING COVENANTS
8.1 BOOKS AND RECORDS. Buyer will use its best efforts to preserve
all books and records of the Sellers included in the Purchased Assets, and to
provide Shareholder or its agents reasonable access to such books and records
for a period of six years following the Closing Date, or until such later date
as preservation of and access to those books and records is no longer required
by any governmental or similar body.
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8.2 COMPLIANCE WITH WARN ACT. Effective as of Closing, Buyer shall
comply in all respects with the WARN Act and shall not take any action that
would subject Sellers to any liability or obligation, including, without
limitation, any disclosure or announcement obligation, under the WARN Act.
8.3 TRANSITION. Shareholder shall permit Buyer to use the sales
office currently utilized by Company in Auburn Hills, Michigan and the related
phone and e-mail system for sales activities for a period of up to 4 months
after Closing at a monthly rate of $2,000 per month, payable at the Closing and
on the first day of each month thereafter, so long as Buyer complies with the
operating terms of Shareholder's lease of such premises. Buyer shall permit
Shareholder and Company to use computers and software included in the Purchased
Assets and located in Auburn Hills, Michigan for a period of approximately 4
months after Closing at no charge to Shareholder or Company.
8.4 INTERNAL REVENUE SERVICE FORMS. Pursuant to the "Alternative
Procedure" provided in Section 5 of the Revenue Procedure 96-60, 1996 C.B. 399,
with respect to filing and furnishing Internal Revenue Service Forms W-2, W-3
and 941, (i) Sellers shall report, and the Buyer shall report, on a
"predecessor-successor" basis as set forth therein, (ii) Sellers shall be
relieved from furnishing Forms W-2 to Transferred Employees, and (iii) the Buyer
shall assume the obligations of Sellers to furnish such forms to such employees
for the full 2003 calendar year. Sellers represent and warrant that all amounts
withheld from employees for taxes, assessments and other governmental charges
have been paid over to the appropriate governmental authority, together with all
matching amounts due and owing from the Company (e.g., social security
employee/employer portions).
8.5 USE OF NAME. Company shall change its name so that Buyer can
use the name "Plastic Trim" and "Starboard Industries."
ARTICLE IX
CONDITIONS PRECEDENT TO THE BUYER'S PERFORMANCE
The obligation of Buyer to purchase the Purchased Assets from Seller
under this Agreement is subject to the satisfaction, on or before the Closing
Date, of all the conditions set forth in this Article IX. Buyer may waive any or
all of these conditions in whole or in part, but only in writing.
9.1 ACCURACY OF REPRESENTATIONS AND WARRANTIES; PERFORMANCE BY
SELLERS. The representations and warranties of the Company and Shareholder
contained in this Agreement shall be true and correct in all Material respects,
except for changes permitted or contemplated by this Agreement or as otherwise
set forth on an updated disclosure letter (the "Bring-Down Letter") attached to
the closing certificate to be delivered to Buyer pursuant to Section 11.2(b)(i),
on and as of the time of Closing with the same effect as though such
representations and warranties had been made at and as of such time (except to
the extent that they expressly relate to an earlier date). The Company and
Shareholder shall have performed and complied with all
- 22 -
Material covenants, agreements and conditions required by this Agreement to be
performed or complied with by it prior to or at the Closing.
9.2 CLOSING DELIVERIES. Buyer shall have received the deliveries
set forth in Sections 11.2(a) and 11.2(b).
9.3 ABSENCE OF LITIGATION. No order shall have been entered by any
court or other Governmental Authority to restrain or prohibit the transactions
contemplated by this Agreement that shall not have been dismissed or resolved.
9.4 CONSENTS. All material consents, approvals, permits, orders
and actions set forth in Section 5.2(b) of the Disclosure Statement that are
indicated as being obtained as a condition to Closing and Section 6.3(b) of the
Buyer Disclosure Statement shall have been obtained and shall be in full force
and effect.
9.5 SATISFACTION OF OUTSTANDING INDEBTEDNESS. At or before the
Closing, all liens on the Purchased Assets securing indebtedness for borrowed
money shall have been released.
ARTICLE X
CONDITIONS PRECEDENT TO THE SELLERS' PERFORMANCE
The obligation of the Sellers to sell and transfer the Purchased Assets
to Buyer under this Agreement is subject to the satisfaction, at or before the
Closing, of all conditions set forth in this Article X. The Sellers may waive
any or all of these conditions in whole or in part, but only in writing.
10.1 ACCURACY OF REPRESENTATIONS AND WARRANTIES; PERFORMANCE BY
BUYER. The representations and warranties of Buyer contained in this Agreement
shall be true and correct in all Material respects, except for changes permitted
or contemplated by this Agreement, on and as of the time of Closing with the
same effect as though such representations and warranties had been made at and
as of such time (except to the extent that they expressly relate to an earlier
date). Buyer shall have performed and complied with all Material covenants,
agreements and conditions required by this Agreement to be performed or complied
with by it prior to or at the Closing Date.
10.2 SHAREHOLDER CONSENT. The sale and transfer of the Purchased
Assets to Buyer shall have been approved by the vote of the holders of a
majority of the outstanding capital stock of Shareholder entitled to vote
thereon.
10.3 CLOSING DELIVERIES. Seller shall have received the deliveries
set forth in Section 11.2(c).
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10.4 ABSENCE OF LITIGATION. No order shall have been entered by any
court or other Governmental Authority to restrain or prohibit the transactions
contemplated by this Agreement that shall not have been dismissed or resolved.
10.5 CONSENTS. All consents, approvals, permits, orders and actions
set forth in Section 5.2(b) of the Disclosure Statement that are indicated as
being obtained as a condition to Closing shall have been obtained and shall be
in full force and effect.
ARTICLE XI
THE CLOSING
11.1 THE CLOSING. The "Closing Date" refers to the date upon which
the parties consummate the purchase and sale of the Purchased Assets as
contemplated herein, and shall occur on or before June 6, 2003 or such later
date as the parties agree. The consummation of the purchase and sale of the
Purchased Assets (the "Closing") shall take place at the offices of Drinker
▇▇▇▇▇▇ & ▇▇▇▇▇ LLP, One ▇▇▇▇▇ Square, ▇▇▇▇ & ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, commencing at 10:00 a.m., local time, on the Closing Date,
and shall be effective as of 12:01 a.m. eastern standard time on the Closing
Date. Subject to Article XII, failure to consummate the Closing shall not result
in the termination of this Agreement or relieve any Person of any obligation
hereunder.
11.2 DELIVERIES AT THE CLOSING. At the Closing, in addition to the
other actions contemplated elsewhere herein:
(a) Shareholder shall deliver, or shall cause to be
delivered, to Buyer the following:
(i) a certificate, dated the Closing Date and
signed by the President or any Vice
President of the Shareholder, to the effect
set forth in Section 9.1.
(ii) a Certificate of Good Standing as of a
recent date for the Shareholder, certified
by the Secretary of the State of Michigan.
(iii) copies of the resolutions of the board of
directors and shareholders of the
Shareholder authorizing the execution,
delivery and performance of this Agreement
and the Shareholder Transaction Documents,
certified as of the Closing by the Secretary
or an Assistant Secretary of the
Shareholder.
(iv) a ▇▇▇▇ of Sale, Assignment and Assumption
Agreement (the "▇▇▇▇ of Sale and Assumption
Agreement"), in form and substance
reasonably satisfactory to counsel for Buyer
and JPE and duly
- 24 -
executed by JPE, conveying to Buyer all of
the JPE's right, title and interest in and
to the Purchased Assets.
(b) Company shall deliver to Buyer the following:
(i) a certificate, dated the Closing Date and
signed by the President or any Vice
President of the Company, to the effect set
forth in Section 9.1.
(ii) a copy of the Company's articles of
incorporation and bylaws, and all amendments
thereof to date, certified as of a recent
date by the Secretary of the State of Ohio
and by the Secretary or an Assistant
Secretary of the Company, and accompanied by
a Certificate of Good Standing as of a
recent date for the Company, certified by
the Secretary of the State of Ohio.
(iii) copies of the resolutions of the board of
directors and sole shareholder of the
Company authorizing the execution, delivery
and performance of this Agreement and the
Company Transaction Documents, certified as
of the Closing by the Secretary or an
Assistant Secretary of the Company.
(iv) a ▇▇▇▇ of Sale, Assignment and Assumption
Agreement (the "▇▇▇▇ of Sale and Assumption
Agreement"), in form and substance
reasonably satisfactory to counsel for Buyer
and PTI and duly executed by PTI, conveying
to Buyer all of the PTI's right, title and
interest in and to the Purchased Assets.
(v) a deed, an assignment of lease and such
other instruments of transfer and
conveyance, in form and substance reasonably
satisfactory to counsel for Buyer and PTI
and duly executed by PTI, as are required in
order to transfer to Buyer good and
marketable title to or a valid leasehold
interest in, as applicable, the Premises.
(c) Buyer shall deliver, or shall cause to be delivered,
to Sellers the following:
(i) immediately available funds in the amount of
the Purchase Price.
(ii) a certificate, dated the Closing Date signed
by the President or any Vice President of
Buyer, to the effect set forth in Section
10.1.
(iii) a copy of Buyer's articles or certificate of
incorporation and bylaws (or other
organizational documents) and all amendments
thereof to date, certified as of a recent
date by the Secretary of State of Ohio and
by the Secretary or an Assistant Secretary
of Buyer, and
- 25 -
accompanied by a certificate of good
standing as of a recent date for Buyer,
certified by the Secretary of State of Ohio.
(iv) a copy of the resolutions of the board of
directors of Buyer authorizing the
execution, delivery and performance by Buyer
of this Agreement and the Buyer Transaction
Documents, certified as of the Closing by
the Secretary or an Assistant Secretary of
Buyer.
ARTICLE XII
TERMINATION
12.1 TERMINATION. This Agreement may be terminated prior to the
Closing Date:
(a) by mutual consent of Buyer and Sellers; or
(b) by Buyer or Sellers if the transactions contemplated
hereby are not consummated on or before June 16, 2003; provided, however, that
the right to terminate this Agreement shall not be available to any party whose
failure to fulfill any obligation under this Agreement has been the cause of, or
resulted in, the failure of the Closing to occur on or before such date; or
(c) by Buyer, if any representation or warranty of the
Company or Shareholder made in or pursuant to this Agreement is untrue or
incorrect in any Material respect or the Company or Shareholder Materially
breaches the covenants or other terms of this Agreement; or
(d) by Sellers if any representation or warranty of Buyer
made in or pursuant to this Agreement is untrue or incorrect in any Material
respect or Buyer Materially breaches the covenants or other terms of this
Agreement; or
(e) by Buyer on or before May 14, 2003, if Buyer's due
diligence investigation unveils material liabilities that were not disclosed in
the Disclosure Statement and Sellers are unwilling to indemnify Buyer against
such material liabilities, or
(f) by Seller pursuant to Section 7.5.
12.2 RIGHTS NOT IMPAIRED. Except as otherwise specifically provided
in Section 7.5, in the event of any failure to consummate any transaction
contemplated by this Agreement, no provision of this Agreement shall impair,
limit or otherwise affect the right of any party hereto to ▇▇▇ any Person for
breach of contract, including, without limitation, for breach of any
representations, warranties or covenants contained herein. Under no
circumstances shall any party hereto be liable for any special, consequential,
indirect or punitive damages for any misrepresentation or breach of any
provision of, or any other matter arising pursuant to, this Agreement or any
Transaction Document.
- 26 -
12.3 PROCEDURE FOR TERMINATION. A party terminating this Agreement
pursuant to Section 12.1 shall give written notice thereof to each other party
hereto, whereupon this Agreement shall terminate and the transactions
contemplated hereby shall be abandoned without further action by any party.
ARTICLE XIII
INDEMNITY
13.1 INDEMNIFICATION OF BUYER.
From and after the Closing, Sellers shall jointly and severally indemnify and
hold Buyer harmless from and against any liabilities, obligations, losses,
damages, costs, charges or other expenses of every kind and character, including
reasonable attorneys' fees and disbursements (collectively, "Damages") arising
after the Closing and actually suffered by or incurred by Buyer arising out of
or as a result of (i) the inaccuracy of any of the representations or warranties
contained in the second sentence of Section 5.8, Section 5.9, Section 5.14,
Section 5.18 and Section 5.21 ("Surviving Representations") or the breach,
nonfulfillment or nonperformance of any covenant or agreement of the Company or
Shareholder under this Agreement or any other Transaction Document, (ii) any and
all amounts which relate to liability for income taxes of the Sellers for any
period or periods ending on or before the Closing Date, (iii) any and all
amounts which relate to liabilities and obligations that arise under ERISA (as
herein defined) as a result of the Company being an ERISA Affiliate of certain
other Persons and that do not relate to actions or omissions of the Company, or
(iv) customer mandated containment due to parts produced by Company prior to the
Closing Date. Notwithstanding the foregoing, Sellers shall not be required to
indemnify or hold harmless Buyer with respect to any Damages incurred by Buyer
under clauses (i) or (iv) above unless, until and then only to the extent that
the aggregate amount of all Damages incurred by Buyer in respect of which
Sellers would be liable to Buyer under clauses (i) and (iv) above exceeds
$500,000 ("Basket"), except that the Basket shall not apply to Damages incurred
by Buyer as a result of a breach of the Surviving Representations. Further,
notwithstanding anything contained herein to the contrary, the aggregate amount
required to be paid by Sellers pursuant to this Section 13.1 in respect of all
Damages for which Sellers would be liable to Buyer under clauses (i) and (iv)
above shall not exceed $4,000,000 and in no event shall Sellers be liable under
clause (iv) above for containment costs for a period of more than six (6) months
after same is mandated. In no event shall Sellers be liable under this Section
13.1 for Damages if C. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ or ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
had actual knowledge on or prior to the Closing Date of the misrepresentation,
breach of warranty or nonperformance or breach of covenant giving rise to such
Damages. A claim relating to indemnification arising out of a breach of the
Surviving Representations or out of a breach by Sellers of a covenant or
agreement under this Agreement or any Transaction Document or under clause (ii)
or (iii) above may be made at any time before the expiration of the statute of
limitations that would be applicable to an action brought by the appropriate
Person with respect to the matters forming the basis for such claim. A claim
under clause (iv) above may be made at any time before 190 days after the
Closing.
- 27 -
(a) The remedy provided by this Section 13.1, subject to
the limitations set forth in this Article XIII, shall be Buyer's sole and
exclusive remedy for the recovery of any damages, losses, deficiencies,
liabilities, costs and expenses resulting from, relating to or arising out of
any (i) misrepresentation or breach of warranty made by or on behalf of the
Sellers in this Agreement or in any certificate delivered by the Sellers
pursuant hereto, (ii) non-fulfillment of any agreement or covenant on the part
of the Sellers or (iii) any other aspect of any transaction contemplated by this
Agreement.
(b) Notwithstanding any other provision hereof, Seller
shall have no liability in respect of any claim for indemnification under this
Section 13.1:
(i) if and to the extent that provision or
reserve for or in respect of the liability
or other matter giving rise to such claim
has been made in the Closing Date Balance
Sheet;
(ii) if and to the extent that such claim arises
or is increased as a result of any change in
legislation that takes effect
retrospectively;
(iii) if and to the extent that such claim occurs
or is increased as a result of any increase
in the rate of taxation in force at the date
hereof;
(iv) if and to the extent that such claim is
wholly or partly attributable to any
voluntary act, omission, transaction or
arrangement of Buyer from and after the
Closing;
(v) to the extent that Buyer is insured against
any loss or damage suffered by it arising
out of such breach or claim under the terms
of any insurance policy; or
(vi) to the extent that such claim relates to any
matter disclosed in the Disclosure Statement
or the Bring Down Letter.
13.2 INDEMNIFICATION OF SELLER. From and after the Closing, Buyer
shall indemnify and hold harmless each of the Sellers from and against any and
all Damages arising after the Closing and actually suffered or incurred by a
Seller arising out of or as a result of (i) the inaccuracy of any representation
or warranty or the breach, nonfulfillment or nonperformance of any covenant or
agreement of Buyer under this Agreement or any other Transaction Document or
(ii) the ownership or operation by Buyer of the Purchased Assets and the conduct
by Buyer of the business that had been conducted by Company, including, without
limitation, any liability arising under any Environmental, Health and Safety
Laws; or (iii) Sellers having made payments to Terminated Employees under
Section 3.3(f) that Buyer rehires within six months of Closing.
13.3 INDEMNIFICATION PROCEDURES.
(a) No party hereto shall be deemed to have breached any
representation, warranty, or covenant if (i) such party shall have notified the
other party hereto in writing, on or
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prior to the Closing Date, of the breach of, or inaccuracy in, or of any facts
or circumstances constituting or resulting in the breach of, or inaccuracy in,
such representation, warranty or covenant and (ii) such other party has
permitted the Closing to occur, in which case such other party shall be deemed
to have waived such breach or inaccuracy.
(b) In case any claim is made, or any suit or action is
commenced, by a third party against Buyer in respect of which indemnification
under Section 13.1 may be sought by it hereunder, or a Seller in respect of
which indemnification under Section 13.2 may be sought hereunder, the
indemnified party (the "Indemnitee") shall promptly give the indemnifying party
(the "Indemnifying Party") notice thereof and the Indemnifying Party shall be
entitled to control the defense thereof. The Indemnitee may (but need not)
retain its own counsel, but the fees and expenses of such counsel shall be at
the expense of the Indemnitee. The Indemnifying Party may at any time notify the
Indemnitee of its intention to settle or compromise any claim, suit or action
against the Indemnitee and provide the Indemnitee with the specifics of the
intended settlement or compromise, and the Indemnifying Party may settle or
compromise any such claim, suit or action unless the Indemnitee notifies the
Indemnifying Party in writing (within ten (10) business days after the
Indemnifying Party has given written notice of its intention to settle or
compromise) that the Indemnitee intends to conduct or to continue to conduct the
defense of such claim, suit or action. Unless the Indemnitee gives the notice
referred to in the foregoing sentence with respect to settlements or
compromises, any such settlement or compromise of, or (notwithstanding any
notice from the Indemnitee referred to in the foregoing sentence) any final
judgment or decree entered on or in respect of any claim, suit or action shall
be binding upon, the Indemnitee as fully as if the Indemnitee had assumed and
controlled the defense thereof and a final judgment or decree had been entered
in such suit or action, or with regard to such claim, by a court of competent
jurisdiction for the amount of such settlement, compromise, judgement or decree.
If the Indemnitee conducts or continues the conduct of the defense of any claim,
suit or action as aforesaid, it shall do so at its own cost and expense above
the terms of an intended settlement or compromise proposal by the Indemnifying
Party, holding the Indemnifying Party harmless from all costs, fees, expenses,
debts, liabilities and charges in connection with such defense.
(c) If an Indemnitee is entitled to be indemnified
hereunder other than in respect of a claim made or action commenced against
Buyer or a Seller as referred to in Section 13.3(b), the Indemnifying Party
shall be given written notice thereof promptly by the Indemnitee, which notice
shall specify the amount and nature of the amounts to be indemnified and include
the request of the Indemnitee for indemnification of such amount. The
Indemnifying Party shall within twenty (20) days pay to the Indemnitee the
amount so specified, or deliver to the Indemnitee written notice setting forth
in reasonable detail why Indemnifying Party is not obligated to pay such amount,
in which event the parties shall use good faith efforts to resolve any disputed
matters. Upon payment in full of any claim, the party making payment shall be
subrogated to the rights of the indemnified party against any Person with
respect to the subject matter of such claim.
13.4 RECOVERY OF COSTS; LIMITATION OF DAMAGES. If any dispute
resolution, legal or equitable action is brought for the enforcement of this
Agreement, or because of an alleged dispute, breach, default, or
misrepresentation in connection with any of the provisions of this
- 29 -
Agreement, the successful or prevailing party or parties shall be entitled to
recover reasonable attorneys' fees and other costs incurred in that action, in
addition to any other relief to which it or they may be entitled. Under no
circumstances shall any party hereto be liable for any special, consequential,
indirect or punitive damages for any misrepresentation or breach of any
provision of, or any other matter arising pursuant to, this Agreement or any
Transaction Document. Notwithstanding anything herein to the contrary, Damages
shall be computed on an after-tax basis, and shall be net of any insurance
recoveries and any refunds, rebates and/or reductions of taxes resulting from
each item of Damages and/or the events giving rise thereto. In addition, under
no circumstances shall Damages include any losses, claims, liabilities, damages,
obligations, costs or expenses to the extent they affect or relate to any
business or operation of Buyer, including, without limitation, the financial
condition, prospects or operations thereof, other than the business of the
Company from and after the Closing.
13.5 DISCLAIMER OF WARRANTIES. EXCEPT AS EXPRESSLY SET FORTH IN THE
SURVIVING REPRESENTATIONS, SELLERS ARE SELLING THE PURCHASED ASSETS (AND THE
BUSINESS REPRESENTED THEREBY) ON AN "AS IS, WHERE IS" BASIS AND DISCLAIMS ALL
OTHER WARRANTIES, REPRESENTATIONS AND GUARANTEES, WHETHER EXPRESS OR IMPLIED.
SELLERS MAKE NO REPRESENTATION OR WARRANTY AS TO MERCHANTABILITY OR FITNESS FOR
ANY PARTICULAR PURPOSE AND NO IMPLIED WARRANTIES WHATSOEVER. Buyer acknowledges
that neither the Sellers nor their respective representatives or other Persons
shall be deemed to have made to Buyer any representation or warranty other than
as expressly made by Sellers in Article V hereof, including without limitation
any representation or warranty, express or implied, as to the accuracy or
completeness of any memoranda, charts, forecasts or other forward looking
information, summaries or schedules heretofore made available to Buyer or any
other information which is not included in this Agreement or the Disclosure
Statement. Neither the Sellers nor their respective representatives or other
Persons will have or be subject to any liability to Buyer or any other Person
resulting from the distribution of any such information to, or use of any such
information by, Buyer or any of its agents, consultants, accountants, counsel or
other representatives.
ARTICLE XIV
MISCELLANEOUS
14.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Other than the
Surviving Representations, the representations and warranties of the parties
contained in this Agreement, or in any instrument, certificate, opinion, or
other writing provided for in it, shall not survive the Closing Date. The
Surviving Representations shall survive the Closing until the expiration of the
statute of limitations that would be applicable to an action brought by the
appropriate Person alleging a breach of such representation or warranty.
14.2 COUNTERPARTS. This Agreement may be executed simultaneously in
one or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute
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one and the same instrument. Photostatic or facsimile reproductions of this
Agreement may be made and relied upon to the same extent as originals.
14.3 ASSIGNMENT. This Agreement shall be binding on, and shall
inure to the benefit of, the parties to it and their respective heirs, legal
representatives, successors, and assigns, but this Agreement shall not be
assignable by a party without the prior written consent of the other party,
except that Buyer may assign this Agreement to an affiliate of Buyer, but in
such event the original signatory hereto as well as the affiliate assignee shall
be jointly and severally liable for the obligations of Buyer hereunder.
14.4 FEES AND EXPENSES. The Sellers and Buyer shall pay all fees,
costs, and expenses (including without limitation legal and accounting expenses)
incurred or to be incurred by each in negotiating and preparing this Agreement
and in closing and carrying out the transactions contemplated by this Agreement;
provided, however, that Buyer shall pay all documentary, transfer, and sales
taxes that arise out of or in connection with the transactions contemplated by
this Agreement, except for taxes imposed on the transfer of the owned Premises
described in Section 5.8 above which taxes shall be paid one-half by Sellers and
one-half by Buyer.
14.5 NOTICES. All notices, waivers and other communications under
this Agreement must be in writing and will be deemed to have been duly given (i)
when delivered by hand (with written confirmation of receipt), (ii) when sent by
facsimile (with written confirmation of successful transmission) or, (iii) two
business days following deposit thereof (with all postage and other fees paid)
with a nationally recognized overnight delivery service, in each case to the
appropriate addresses and facsimile numbers, as applicable, set forth below (or
to such other addresses and facsimile numbers as a party may designate by notice
to the other parties):
Buyer: PTI Acquisition LLC
c/o C. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
With a Copy to: Coolidge, Wall, Womsley & Lombard Co., LPA
▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇ III
Company: Plastic Trim, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇, General Manager
- 31 -
Shareholder: JPE, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇, President & COO
With a Copy to: Drinker ▇▇▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
14.6 GOVERNING LAW. This Agreement shall be construed in accordance
with, and governed by, the internal Laws of the State of Ohio without regard to
the principles of conflicts of Laws thereof.
14.7 FURTHER ACTIONS AND ASSURANCES. Each of the parties hereto
shall use such party's reasonable best effort to take such action as may be
necessary or reasonably requested by the other parties hereto to carry out and
consummate the transactions contemplated by this Agreement. From time to time,
at Buyer's request, whether at or after the Closing and without further
consideration, Sellers shall execute and deliver such further instruments of
assignment, conveyance and transfer and take such other actions as Buyer may
reasonably request to convey and transfer more effectively to Buyer any of the
Purchased Assets. Buyer shall, after the Closing, from time to time, promptly
execute, acknowledge and deliver any other assurances or documents reasonably
requested by Sellers. In addition, Buyer shall, at the reasonable request of
Sellers, make Transferred Employees reasonably available to assist Sellers in
the preparation of its financial statements for the period prior to the Closing
and to assist, at Sellers' expense, Sellers in the defense of any claims for
which Sellers have responsibility hereunder.
14.8 EFFECT OF HEADINGS. The subject headings of the articles and
sections of this Agreement are included for purposes of convenience only, and
shall not affect the construction or interpretation of any of its provisions.
14.9 SEVERABILITY. The invalidity or unenforceability of any
particular provision, or part of any provision, of this Agreement shall not
affect the other provisions or parts hereof, and this Agreement shall be
construed in all respects as if such invalid or unenforceable provisions or
parts were omitted.
14.10 REPRESENTATIONS. No representation or warranty in this
Agreement shall be deemed violated if the information required to be disclosed
by a party in any such representation or warranty is disclosed by such party in
or in response to any other representation or warranty of such party in this
Agreement.
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14.11 ENTIRE AGREEMENT; MODIFICATION; WAIVER. This Agreement,
together with the other agreements referred to herein, constitute the entire
agreement between the parties pertaining to the subject matter contained in it
and supersedes all prior agreements, representations, and undertakings of the
parties hereto. No supplement, modification, or amendment of this Agreement
shall be binding unless executed in writing by all the parties. No waiver of any
of the provisions of this Agreement shall be deemed, or shall constitute, a
waiver of any other provision, whether or not similar, nor shall any waiver
constitute a continuing waiver. No waiver shall be binding unless executed in
writing by any party making the waiver.
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IN WITNESS WHEREOF, the parties to this Agreement have duly executed it
on the day and year first above written.
JPE, INC.
By: _____________________________________
Name:
Title:
PLASTIC TRIM, INC.
By: _____________________________________
Name:
Title:
PTI ACQUISITION, LLC
By: ______________________________________
Name: C. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: President
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