ASSET PURCHASE AGREEMENT
BY AND BETWEEN
ALLTRISTA CORPORATION
TRIANGLE PLASTICS, INC.,
TRIENDA CORPORATION
AND
▇▇▇▇▇ ▇. ▇▇▇▇
TABLE OF CONTENTS
Page
ARTICLE I. DEFINITIONS.......................................................1
1.1 Definitions 1
1.2 Index of Other Defined Terms..................................................5
ARTICLE II. TRANSFER OF ASSETS................................................6
2.1 Purchase and Sale of Assets...................................................6
2.2 Excluded Assets...............................................................7
2.3 Instruments of Transfer and Assignment........................................7
2.4 Consents to Assignments.......................................................8
2.5 Subsequent Documentation......................................................8
ARTICLE III. PURCHASE PRICE....................................................8
3.1 Consideration, Payment........................................................8
3.2 Adjustment 8
3.3 Allocation of Consideration..................................................10
ARTICLE IV ASSUMPTION OF LIABILITIES........................................10
4.1 Assumption 10
ARTICLE V REPRESENTATIONS, WARRANTIES AND AGREEMENTS
OF THE SELLER....................................................11
5.1 Disclosure Schedule..........................................................11
5.2 Organization, Good Standing, Power, Etc......................................11
5.3 Articles of Incorporation and Bylaws.........................................11
5.4 Authorization of Agreement...................................................11
5.5 Effect of Agreement, Etc.....................................................11
5.6 Consents and Approvals.......................................................12
5.7 Financial Information........................................................12
5.8 No Undisclosed Liabilities, Claims, Etc......................................12
5.9 Litigation .................................................................13
5.10 Taxes .................................................................13
5.11 Accounts Receivable and Accounts Payable.....................................13
5.12 Inventory .................................................................14
5.13 Absence of Certain Changes or Events.........................................14
5.14 Contracts and Commitments....................................................16
5.15 OSHA, Environmental..........................................................17
5.16 Customers and Vendors........................................................19
5.17 Books and Records............................................................19
5.18 Employment Matters...........................................................19
5.19 Employee Benefit Plans.......................................................20
5.20 Employees ..................................................................20
5.21 Finder ......................................................................21
5.22 Sufficiency of Assets........................................................21
5.23 Governmental Authorizations..................................................21
5.24 Compliance with Applicable Laws..............................................21
5.25 Title to Assets, Absence of Liens and Encumbrances, Etc......................22
5.26 Intellectual Property........................................................22
5.27 Realand Leased Property......................................................22
5.28 Personal Property............................................................24
5.29 Year 2000 .................................................................24
ARTICLE VI REPRESENTATIONS,WARRANTIES AND AGREEMENTS OF
THE BUYER........................................................25
6.1 Organization, Etc............................................................25
6.2 Authorization of Agreement...................................................25
6.3 Approvals .................................................................25
6.4 Finder .................................................................26
6.5 Effect of Agreement, Etc.....................................................26
6.6 Projections 26
6.7 Financial Condition..........................................................26
ARTICLE VII COVENANTS OF THE PARTIES.........................................27
7.1 Operation Of Business Prior To Closing.......................................27
7.2 Approvals, Consents, Etc.....................................................28
7.3 Further Assurances...........................................................28
7.4 Access Prior to Closing......................................................28
7.5 Turn Over .................................................................29
7.6 Seller's Employees, Retirement Benefits......................................29
7.7 Access After the Closing.....................................................29
7.8 Taxes .................................................................30
7.9 Environmental Matters........................................................31
7.10 No Solicitation..............................................................31
7.11 Confidentiality..............................................................31
7.12 Non-Competition..............................................................31
7.13 [Reserved]...................................................................32
7.14 Bedliner Litigation..........................................................33
7.15 Enforcement .................................................................33
7.16 Corporate Name...............................................................33
7.17 Portage Remediation..........................................................33
7.18 Shareholder Net Worth........................................................33
7.19 Certain Permit Applications..................................................34
ARTICLE VIII CLOSING................................................................34
8.1 Closing .................................................................34
8.2 Buyer's Conditions to Closing................................................34
8.3 Seller's and Shareholder's Conditions to Closing.............................36
ARTICLE IX DISPUTE RESOLUTION...............................................38
9.1 Initial Meeting..............................................................38
9.2 Mediation .................................................................38
9.3 Binding Arbitration..........................................................38
9.4 Discovery .................................................................38
9.5 Expeditious Proceedings......................................................38
9.6 Attorneys' Fees..............................................................39
9.7 Enforcement of Awards........................................................39
9.8 Equitable Relief.............................................................39
ARTICLE X INDEMNIFICATION..................................................39
10.1 Indemnification by Seller....................................................39
10.1A Portage Indemnity............................................................40
10.2 Indemnification by Buyer.....................................................40
10.2A Hold Harmless, Waiver and Release............................................41
10.3 Limits .................................................................41
10.4 Procedure .................................................................42
10.5 Exclusive Remedy.............................................................43
10.6 Insurance and Taxes..........................................................43
ARTICLE XI TERMINATION......................................................43
11.1 Termination .................................................................43
11.2 Risk of Loss.................................................................44
ARTICLE XII GENERAL..........................................................44
12.1 Expenses .................................................................44
12.2 Survival of Representations and Warranties...................................44
12.3 Updates to Schedules.........................................................44
12.4 Waivers .................................................................44
12.5 Binding Effect; Benefits; Assignment.........................................44
12.6 Notices .................................................................45
12.7 Entire Agreement.............................................................46
12.8 Headings .................................................................46
12.9 Governing Law................................................................46
12.10 Amendments ..................................................................46
12.11 Severability.................................................................46
12.12 Press Releases...............................................................46
12.13 Counterparts.................................................................46
ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT (this "Agreement") dated as of March 12, 1999
among Alltrista Corporation, an Indiana corporation (the "Buyer"), Triangle
Plastics, Inc., an Iowa corporation ("Triangle"), TriEnda Corporation, a
Wisconsin corporation and Seller's wholly-owned subsidiary ("Subsidiary", and
collectively with Triangle, the "Seller"), and ▇▇▇▇▇ ▇. ▇▇▇▇ ("Shareholder").
RECITALS:
WHEREAS, Seller is engaged in the Business:
WHEREAS, Triangle and Subsidiary desire to sell to the Buyer substantially
all of each Company's assets;
WHEREAS, Buyer desires to purchase from Seller and Subsidiary such assets
and properties of each Company, pursuant to the terms and conditions of this
Agreement.
NOW, THEREFORE, in consideration of the premises and mutual agreements
hereinafter set forth, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions. As used herein, the following terms have the following
meanings:
"Accounts Receivable" means each Company's accounts receivable in
existence on the Closing Date.
"Blin Controlled Real Property" means the Owned Real Property and the
Leased Real Property.
"Business" means all of the business, products, support and services of
each Company as of the date hereof and as of the Closing Date.
"Cadillac litigation" means the litigation summarized on Schedule 4.1(e) as
Cadillac Products v. TriEnda Corporation, No. 98-75206, U.S. District Court,
Eastern District of Michigan.
"Closing Approvals" means those approvals and consents to be obtained prior
to Closing, as designated on Sections 5.5. and ------------ 5.6 of the
Disclosure Schedule. ---
"Companies" means Triangle and Subsidiary, "either Company" means either
Triangle or Subsidiary, and "each Company" or "each of the Companies" means each
of Triangle and Subsidiary.
"Contracts" means all of each Company's personal property leases and other
agreements, supply agreements, licenses, purchase orders from customers,
purchase orders to suppliers, contracts and commitments related to the Business,
which are limited to (a) the leases, agreements, contracts and commitments
relating to or necessary to the conduct and operation of the Business set forth
on Schedule 1.1(a) attached hereto and (b) all contracts under which the
obligations of the Companies thereunder in any fiscal year are individually less
than Fifty Thousand Dollars ($50,000).
"Environmental Conditions" means the state of the environmental, including
soil, surface water, ground water, any present or potential drinking water
supply, subsurface strata or ambient air, relating to or arising out of the use,
handling storage, treatment, recycling generation, transportation, spilling,
leaking, pumping, pouring, injecting, emptying, discharging, emitting, escaping,
leaching, dumping, disposal, release, or threatened release of Hazardous
Materials.
"Environmental Laws" means any applicable laws (including duties imposed by
common law), rules, regulations, orders, ordinances, judgments and decrees of
all governmental authorities relating to the environment, including but not
limited to the Comprehensive Environmental Response, Compensation, and Liability
Act of 1980, as amended ("CERCLA") (42 U.S.C. Sections 9601, et seq.), the
Hazardous Materials Transportation Act, as amended (49 U.S.C. Section 1801, et
seq.), the Resource Conservation and Recovery Act, as amended (42 U.S.C.
Sections 6901, et seq.), the Federal Water Pollution Control Act, as amended (33
U.S.C. Sections 1251, et seq.), the Clean Air Act, as amended (42 U.S.C.
Sections 7401, et seq.), the Toxic Substances Control Act, as amended (15 U.S.C.
Sections 2601, et seq.), the Clean Water Act, as amended (33 U.S.C. Sections
1251, et seq.) and similar state and local laws and any regulations issued in
connection with the foregoing.
"Estimated Net Working Capital and Improvements" means an amount equal to
Twenty-four Million Two Hundred Thirty Thousand Dollars ($24,230,000).
"Hazardous Substances" means solvents, pollutants, chemicals, flammables,
contaminants, gasoline, petroleum products, crude oil, explosives, radioactive
materials, hazardous materials or toxic materials, substances, or wastes, or
polychlorinated biphenyls.
"HSR Act" means the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976,
as amended to date.
"Intellectual Property" means all United States and foreign patents and
patent applications (whether utility, design, or plant product), registered and
unregistered trademarks, service marks, trade names (including the names
"TriEnda" and "Triangle Plastics"), logos, brands, business identifiers, private
labels, trade dress (including all goodwill and reputation symbolized by any of
the foregoing), rights of publicity, processes, industrial designs, inventions,
registered and unregistered copyrights and copyright applications, product
formulas, know-how, and trade secrets, and all rights with respect to the
foregoing, and all other proprietary rights that Seller owns, licenses, or
possesses the right to use with respect to the Assets or in the conduct of the
Business.
"Inventory" means all inventory, work in progress, raw materials, finished
products, supplies, packaging and shipping containers and materials of each
Company (on-site, off-site and consigned) as of the Closing Date.
"Knowledge" or "best knowledge" or "known" or the like, when used with
respect to the Companies, either Company, each Company or the Seller, means the
actual knowledge of the Shareholder, ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇.
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇.
"Leased Real Property" means the Real Property designated as being owned by
The Blin Corporation on Schedule 1.1(b).
"Material" or "material" means material in relation to the consolidated
financial position and results of operations of either Company individually or
the Companies taken as a whole.
"Material Adverse Effect" means, when used with respect to Seller or the
Subsidiary, a material adverse effect on the Assets, operations, business,
competitive position or financial condition of Triangle or Subsidiary, as
applicable.
"Net Working Capital and Improvements " means an amount calculated in
accordance with Schedule 1.1(c) hereof as of the close --------------- of
business on the Closing Date.
"Owned Real Property" means the real property designated as owned by either
Company on Schedule 1.1(b) hereto.
"Permitted Encumbrances" means any encumbrance set forth on Schedule
1.1(d).
"Permitted Liens" means the liens set forth on Schedule 1.1(e), liens for
taxes or governmental assessments, charges or claims the payment of which is not
yet due, statutory liens of landlords and liens of carriers, warehousemen,
mechanics, materialmen and other similar persons and other liens imposed by
applicable law incurred in the ordinary course of business for sums not yet
delinquent or immaterial in amount and being contested in good faith, and liens
constituting or securing executory obligations under any lease. Permitted Liens
shall also include Permitted Encumbrances.
"Person" means any individual, corporation, partnership, joint venture,
association, limited liability company, joint stock company, trust, or
unincorporated association, or any governmental agency, officer, department,
commission, board, bureau or instrumentality thereof.
"Phase I Reports" means (i) the Hydrogeologic Investigation Report, Penda
Corporation, Portage, Wisconsin, dated January 1990 prepared by RMT, Inc; (ii)
the Groundwater Quality Site Assessment Plan for Penda Corporation, dated July
12, 1990, prepared by RMT, Inc; (iii) Remedial Action Plan, for the Penda
Corporation, Lewiston Facility, Portage, Wisconsin, dated January 1992, prepared
by RMT, Inc; (iv) the Environmental Compliance Assessment, TriEnda Corporation,
Portage, Wisconsin, dated May 1995, prepared by RMT, Inc; (v) the Review of
Environmental Database Search of the Area Surrounding TriEnda Corporation,
Portage Wisconsin, dated December, 1998, prepared by RMT, Inc., (vi) the 1996
Annual Groundwater Monitoring Report, dated March, 1997, with respect to TriEnda
Corporation and Portage Wisconsin, prepared by RMT, Inc., (vii) the 1997 Annual
Groundwater Monitoring Report, prepared for TriEnda Corporation, Portage,
Wisconsin, prepared by RMT, Inc., dated February 1998; (viii) the 1998 Annual
Groundwater Monitoring Report, prepared for TriEnda Corporation, Portage,
Wisconsin, prepared by RMT, Inc., dated January, 1999; (ix) Phase I
Environmental Site Assessment of TriEnda Corporation, Portage, Wisconsin,
prepared by RMT, Inc., dated March, 1999; (x) the Phase I Environmental Site
Assessment and Environmental Compliance Audit of Triangle Plastics, Oelwein,
Iowa, dated November, 1998, prepared by RMT, Inc.; (xi) environmental
assessments performed by and for Amoco, as set forth in Appendix C of the RMT,
Inc. report for Oelwein, Iowa; (xii) the Phase I Environmental Site Assessment
and Compliance Audit of Triangle Plastics, Independence, Iowa, dated November,
1998, prepared by RMT, Inc; (xiii) the Phase I Environmental Site Assessment and
Compliance Audit of Triangle Plastics, Site Assessment and Environmental
Compliance Audit of Triangle Plastics, Winthrop, Iowa, dated November, 1998,
prepared by RMT, Inc., (xiv) the Phase I Environmental Site Assessment and
Environmental Compliance Audit of Triangle Plastics, Cookeville, Tennessee,
dated December 1998, prepared by RMT, Inc.; (xv) the Phase I Environmental Site
Assessment and Environmental Compliance Audit of Triangle Plastics, Auburndale,
Florida, dated December 1998, prepared by RMT, Inc.; and (xvi) the Environmental
Site Assessment Report for Progress Plastics, Inc., for 103 and ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇▇ Florida, dated June 5, 1995, prepared by Atlanta Testing and Engineering
and set forth in Appendix C of the RMT, Inc. report for Oelwein.
"Post-Closing Tax Period" means any tax period (or portion thereof) ending
after the Closing Date.
"Pre-Closing Tax Period" means any tax period (or portion thereof) ending
on or before the close of business on the Closing Date.
"Real Property" means the real property owned or leased by either Company
and related to the Business which is located at the locations set forth on
Schedule 1.1(b) hereto. Unless the context otherwise requires, references to the
Leased Real Property and Warehouse Leased Real Property are references to the
leasehold interest created by the related lease.
"Taxes" means all federal, state, local, or foreign taxes (including excise
taxes, occupancy taxes, employment taxes, unemployment taxes, ad valorem taxes,
custom duties, transfer taxes, and fees), levies, imposts, fees, impositions,
assessments, or other governmental charges of any nature imposed upon a Person
including all taxes or governmental charges imposed upon any of the personal
properties, real properties, tangible or intangible assets, income, receipts,
payrolls, transactions, stock transfers, capital stock, net worth or franchises
of a Person (including all sales, use, withholding or other taxes which a Person
is required to collect and/or pay over to any government), and all related
additions to tax, penalties or interest thereon.
"Tax Returns" means any return, report, information return, or other
document (including any related or supporting information) filed or required to
be filed with any governmental agency, department, commission, board, bureau, or
instrumentality in connection with the determination, assessment, collection, or
administration of any Taxes.
"Triangle Shareholders" means the direct and indirect shareholders of
Seller on the Closing Date.
"TriEnda Agreement" means the Agreement dated January 2, 1998 among Seller,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, as amended or supplemented.
"Union Contract" means the contract dated December 1, 1998 between Seller
and United Food & Commercial Workers Local 431 and any amendments or successor
contracts with respect thereto.
"Warehouse Leased Real Property" means leases of warehouse and office space
from third parties set forth on Schedule 1(b) hereto.
1.2 Index of Other Defined Terms. In addition to terms defined above, the
following terms shall have the respective meanings given to them in the Sections
set forth below:
Defined Term Section
------------ -------
Aggregate Consideration 3.1
Agreement Preamble
Assets 2.1
Assumed Liabilities 4.1
Basket 10.3
Benefit Plan 5.19
Buyer Preamble
Cap 10.3
Claims 10.1
Closing 8.1
Closing Date 8.1
Closing Date Statement 3.2
Commitments 5.14
Code 3.3
Confidential Information 7.12
Customers 5.16
Disclose 7.11
Disclosure Schedule 5.1
Drop Dead Date 11.1
ERISA 5.19
Excluded Assets 2.2
Excluded Records 2.1(j)
Financial Information 5.7
Incremental Tax Amount 3.3
Information 7.11
Licensed Intellectual Property 5.26
Material Adverse Change 8.2(o)
Minimum Claim 10.3
Notice of Dispute 9.1
Owned Intellectual Property 5.26
Plan 5.19
Property Laws 5.27
Portage Condition 10.1A
Purchase Price 3.1
Section 10.1 Indemnified Parties 10.1
Section 10.2 Indemnified Parties 10.2
Receivables Basket 10.3
Seller Preamble
Seller Parties 10.2A
Scheduled Intellectual Property 5.26
Shareholder Preamble
Statement of Objections 3.2
Subsidiary Recitals
Triangle Preamble
Transferred Employees 7.6
Vendors 5.16
ARTICLE II
TRANSFER OF ASSETS
2.1 Purchase and Sale of Assets. At the Closing and on the Closing Date, on
the terms and conditions set forth herein, the Seller shall, and shall cause the
Subsidiary to, sell, assign, transfer and deliver to the Buyer and the Buyer
shall purchase from each Company, all of the Assets owned by such Company, free
and clear of all liens, encumbrances, security interests, options, pledges of
any kind whatsoever, except for Permitted Liens and Permitted Encumbrances other
than the Excluded Assets. The assets, properties and rights to be sold by each
Company and purchased by the Buyer under this Agreement (collectively, the
"Assets") are:
(a) the Real Property designated as being owned by each Company on
Schedule 1.1(b) hereto and the leasehold interests owned by each Company in
the Warehouse Leased Real Property;
(b) the Accounts Receivable which shall be set forth on a listing
delivered by Seller at Closing or as soon as practicable thereafter and
reasonably acceptable to Buyer;
(c) the Inventory which shall be set forth on a listing delivered by
Seller at Closing or as soon as practicable thereafter and reasonably
acceptable to Buyer;
(d) all machinery, equipment, furniture, fixtures, vehicles, computer
hardware and software (including software licenses) and other personal
property of each Company used in the Business set forth on Schedule 2.1(d)
attached hereto;
(e) all of the following items used by each Company in the conduct and
operation of the Business: (i) customer and contact lists, including names,
addresses and telephone numbers, (ii) sales, product and promotional data,
catalogs, brochures, literature, forms, mailing lists, art work,
photographs and advertising materials, (iii) vendor lists, including names,
addresses and the names of their representatives, (iv) product
specifications and plans and drawings related thereto and (v) other
Intellectual Property;
(f) all of the prepaid expenses, deposits and credits relating to the
Business set forth on Schedule 2(f) -------------- hereto;
(g) subject to the provisions of Section 2.4 below, all of each
Company's rights under the Contracts; -----------
(h) all backlog, orders, contracts and commitments for the sale of
products sold by the Business;
(i) subject to the provisions of Section 2.4 below, all permits,
approvals, qualifications, and the like issued by any government or
governmental unit, agency, board, body, or instrumentality, whether
foreign, federal, state, local or otherwise relating to or necessary to the
conduct and operation of the Business set forth on Schedule 2.1(i) which by
their express terms are assignable; and
(j) all business records relating to the Business (but excluding any
tax analysis and workpapers and core corporate records, including minute
books of each Company's Board of Directors and shareholders (the "Excluded
Records")).
2.2 Excluded Assets. Notwithstanding the foregoing, the Assets shall not
include the items set forth on Schedule 2.2 attached hereto (the "Excluded
Assets").
2.3 Instruments of Transfer and Assignment. On the Closing Date the Seller
shall deliver or cause to be delivered to the Buyer duly executed bills of sale,
deeds (which, with respect to the Real Property owned by each Company, shall be
a general warranty deed), licenses and such other instruments of transfer and
assignment as may be necessary to vest in the Buyer, subject to Section 2.4 and
the Assumed Liabilities, good and valid title to, and all of the Seller's right,
title and interest in and to, the Assets, free and clear of all liens,
encumbrances, options and pledges of any kind other than Permitted Liens and
Permitted Encumbrances and except as noted herein and the Schedules hereto,
which bills of sale, deeds, licenses and other instruments of transfer and
assignment shall be in form and substance reasonably satisfactory to the Buyer.
2.4 Consents to Assignments. Nothing in this Agreement or the documents to
be executed and delivered at the Closing shall be deemed to constitute an
assignment or an attempt to assign any permit, contract or other agreement to
which the Seller is a party, if the attempted assignment thereof without the
consent of the other party to such permit, contract or other agreement would
constitute a breach thereof or affect in any way the rights of the Seller
thereunder. If any such consent shall not be obtained at or prior to the
Closing, or if an attempted assignment would be ineffective or would adversely
affect a Company's rights thereunder, the Seller shall cooperate, and shall
cause the Subsidiary to cooperate, in any arrangement the Buyer may reasonably
request (provided that the payment of money to any party shall not be required)
to provide for the Buyer the benefits under such permit, contract or other
agreement.
2.5 Subsequent Documentation. At any time and from time to time after the
Closing Date, the Seller shall, upon the request and expense of the Buyer, and
the Buyer shall, upon the request and expense of the Seller, promptly execute,
acknowledge, and deliver, or cause to be executed, acknowledged, and delivered,
such further instruments and other documents, and perform or cause to be
performed such further acts, as may be reasonably required to evidence or
effectuate the sale, conveyance, transfer, assignment, and delivery hereunder of
the Assets, the assumption by the Buyer of the Assumed Liabilities, the
performance by the parties of any of their other respective obligations under
this Agreement, and to carry out the purposes and intent of this Agreement.
ARTICLE III
PURCHASE PRICE
3.1 Consideration, Payment. (a) The cash consideration to be paid by the
Buyer to the Seller for the Assets is One Hundred Forty-eight Million Dollars
($148,000,000), less the aggregate amount of any obligations or liabilities or
interest-bearing debt agreed upon by Seller and Buyer at least one business day
prior to Closing as liabilities to be assumed by Buyer in addition to the
Assumed Liabilities (the "Purchase Price"). In no case shall the Purchase Price
be reduced by payments by Buyer to Seller for certain working capital
liabilities satisfied by Seller and reimbursed by Buyer as set forth on Schedule
1.1(c).
(b) The Purchase Price shall be paid at Closing in immediately
available funds.
(c) The Purchase Price is in addition to all liabilities and
obligations of each Company to be assumed by Buyer pursuant to Article IV.
Such Assumed Liabilities, together with the Purchase Price, are
collectively referred to as the "Aggregate Consideration."
3.2 Adjustment. Not more than sixty (60) days following the Closing Date,
Seller shall deliver to Buyer an unaudited statement as of the Closing Date (the
"Closing Date Statement") that sets forth the actual Net Working Capital and
Improvements transferred on the Closing Date. The Closing Date Statement shall
be prepared in accordance with generally accepted accounting principles
consistent with those used in the Financial Information (assuming all such
financial information had been prepared on a consolidated basis and after giving
effect to purchase accounting adjustments necessitated by the acquisition of the
Subsidiary).
Upon receipt of the Closing Date Statement, Buyer (and at Buyer's expense,
its independent certified public accountants) shall be permitted during the
succeeding thirty (30) day period to examine, and Seller shall make available,
the books and records relied upon by Seller in preparing the Closing Date
Statement. As promptly as practicable, and in no event later than the last day
of such thirty (30) day period, Buyer shall either inform Seller in writing that
the Closing Date Statement is acceptable or object to the Closing Date Statement
by delivering to Seller a written statement setting forth a specific description
of Buyer's objection to the Closing Date Statement (the "Statement of
Objections") and Buyer's calculation of any disputed amounts.
If Buyer shall fail to deliver a Statement of Objections within such thirty
(30) day period, the Closing Date Statement shall be deemed to have been
accepted by Buyer. If a Statement of Objections is delivered, Buyer and Seller
shall attempt in good faith to resolve any dispute within fifteen (15) days
after delivery. If Seller and Buyer are unable to resolve the dispute within
such fifteen (15) days, Buyer and Seller shall engage the Minneapolis office of
a "Big 5" accounting firm reasonably acceptable to Buyer and Seller to resolve
any unresolved objections. The fees of such firm shall be paid by Seller if
Buyer's calculation of disputed amounts as set forth in the Statement of
Objections is closer to such accountant's final determination than Sellers'
determination, and otherwise such fees shall be paid by Buyer. Such firm's
resolution of the dispute shall be conclusive and binding upon the parties and
nonappealable and shall not be subject to further review under the dispute
resolution provisions of Article IX.
If Net Working Capital and Improvements on the Closing Date Statement
(after resolution of all disputes related thereto) exceeds Estimated Net Working
Capital and Improvements, Buyer shall pay Seller the difference between Net
Working Capital and Improvements and Estimated Net Working Capital and
Improvements. If Estimated Net Working Capital and Improvements exceeds Net
Working Capital and Improvements on the Closing Date Statement (after resolution
of all disputes related thereto), Seller shall pay Buyer the difference between
Estimated Net Working Capital and Improvements and Net Working Capital and
Improvements. The amount of any payment hereunder shall be increased by an
interest factor, equal to the reference rate publicly announced by U.S. Bank (or
other major financial institution agreed by the parties) on the Closing Date.
Buyer shall also reimburse Seller for those working capital items designated as
being reimbursed by Buyer on Schedule 1.1(c) to the extent Seller has satisfied
such items. Such interest shall accrue from the Closing Date through and
including the date such payment is made, with such prime rate being compounded
annually. Such payments shall be made in immediately available funds within five
(5) days after deemed acceptance of or resolution of disputes related to the
Closing Date Statement.
Notwithstanding the foregoing, no payments shall be made by either party
hereunder (except for payments by Buyer to Seller for liabilities satisfied by
Seller as set forth on Schedule 1.1(c)) if the difference between Net Working
Capital and Improvements on the Closing Date Statement (after resolution of all
disputes related thereto) and Estimated Net Working Capital and Improvements is
less than or equal to Five Hundred Thousand Dollars ($500,000). If such
difference exceeds Five Hundred Thousand Dollars ($500,000), such payment shall
be made only to the extent it exceeds $500,000.
3.3 Allocation of Consideration. Seller and the Buyer shall allocate the
Aggregate Consideration among the Assets as set forth in Schedule 3.3 hereto.
The Buyer and Seller shall, and Seller shall cause the Subsidiary to file, in
accordance with Section 1060 of the Internal Revenue Code of 1986 (the "Code")
an Asset Allocation Statement on Form 8594 which reflects the allocations set
forth on Schedule 3.3 with its federal income tax return for the tax year in
which the Closing Date occurs and shall contemporaneously provide the other
party with a copy of the Form 8594 being filed. Each party agrees not to assert,
in connection with any tax return, audit or other similar proceeding, any
allocation of the Aggregate Consideration which differs from the allocation set
forth on Schedule 3.3.
ARTICLE IV
ASSUMPTION OF LIABILITIES
4.1 Assumption. The Buyer is not assuming or agreeing to assume or
discharge any liability or obligation of either Company whatsoever, whether now
existing or hereafter incurred, including without limitation, any liability or
obligation relating to the Assets or the sale thereof, excepting only the
following (the "Assumed Liabilities") for which Buyer agrees to be solely
responsible:
(a) those liabilities and obligations of each Company related to
future performance to be discharged or performed after the Closing Date
under the Contracts;
(b) all accounts payable of each Company, which will be set forth on a
payables schedule in the form attached as Schedule 4.1 delivered by Seller
to Buyer at the Closing; ------------
(c) obligations of each Company relating to warranty commitments;
(d) all liability for leases and equipment leases of each Company
(other than any leases replaced pursuant to Section 8.3(i)), including
those set forth on Schedule 4.1(d);
(e) those liabilities and obligations of each Company set forth on
Schedule 4.1(e).
The Seller and the Subsidiary, as applicable, shall pay and be responsible
for any liabilities or obligations of the applicable Company arising from or
relating to the Business which are not Assumed Liabilities.
ARTICLE V
REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF
THE SELLERARTICLEVREPRESENTATIONS,WARRANTIESANDAGREEMENTSOFTHESELLER
The Seller and the Shareholder, hereby jointly and severally represent and
warrant to and agree with the Buyer as follows, all of which representations,
warranties and agreements are made as of the date of this Agreement and as of
the Closing Date:
5.1 Disclosure Schedule. The disclosure schedule attached hereto as
Schedule 5.1 hereto (the "Disclosure Schedule") is divided into sections which
correspond to the Sections of this Agreement. Any item on the Disclosure
Schedule shall be considered an exception to all representations and warranties
even if not specifically cross referenced or referred to herein or therein.
5.2 Organization, Good Standing, Power, Etc. Each Company is a corporation
duly organized and validly existing under the laws of the jurisdiction of its
incorporation. Each Company is qualified to do business and is in good standing
in each jurisdiction in which the character and location of the assets or the
nature of the Business transacted by the Company makes such qualification
necessary or the failure to qualify would have a material adverse effect on the
business, operations or financial condition of the Business. Each Company has
the requisite corporate power and authority to own or lease and operate its
Assets and conduct its Business and to consummate the transactions contemplated
hereby. Seller owns all of the issued and outstanding stock of Subsidiary,
subject to the lien of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ pursuant to the
TriEnda Agreement and the lien of ▇. ▇▇▇▇▇▇ Gavinsky pursuant to the Stock
Pledge Agreement dated September 1, 1996 between ▇. ▇▇▇▇▇▇ Gavinsky and TriEnda
Corporation.
5.3 Articles of Incorporation and Bylaws. Each Company has furnished the
Buyer with (a) the Articles of Incorporation of such Company, as amended to date
and (b) the Bylaws of such Company, as amended to date. Such Articles of
Incorporation and Bylaws are in full force and effect.
5.4. Authorization of Agreement. The execution, delivery and performance of
this Agreement by the Seller has been duly and effectively authorized by the
Board of Directors of each Company and, at the Closing Date, consummation of the
transactions contemplated hereby will be duly and effectively authorized by the
Board of Directors and shareholders of each Company and no other corporate
proceedings will be necessary to authorize this Agreement and the transactions
contemplated hereby. This Agreement has been duly and validly executed and
delivered by the Seller and the Shareholder and constitutes the valid and
binding obligation of the Seller and the Shareholder enforceable in accordance
with its terms.
5.5 Effect of Agreement, Etc. Except as set forth on the Disclosure
Schedule, the execution, delivery and performance of this Agreement by each
Company and the Shareholder and consummation by each Company and the Shareholder
of the transactions contemplated hereby will not, with or without the giving of
notice and the lapse of time, or both, (a) violate any provision of law,
statute, rule or regulation to which either Company or the Shareholders are
subject, (b) violate any judgment, order, writ or decree of any court applicable
to either Company or the Shareholders, (c) have any Material Adverse Effect on,
or be a material violation of, any of the permits, licenses, orders or approvals
relating to the Business or the ability of the Buyer to make use of such
permits, licenses, orders or approvals, or (d) result in a material breach of or
conflict with any term, covenant, condition or provision of, result in a
material modification or termination of, constitute a material default under, or
result in the creation or imposition of any lien, security interest,
restriction, charge or encumbrance upon any of the Assets (other than Permitted
Liens and the Assumed Liabilities) pursuant to any Articles of Incorporation,
Bylaws, organizational documents, commitment, contract or other agreement or
instrument to which either Company or the Shareholder is a party or by which any
of the Assets are or may be bound or affected or from which either Company
derives benefits with respect to the Business.
5.6 Consents and Approvals. Except as set forth on the Disclosure Schedule,
no permit, application, notice, transfer, consent, approval, order,
qualification, waiver from, or authorization of, or declaration, filing or
registration with, any governmental authority is necessary in connection with
the execution and delivery by the Seller and the Shareholder of this Agreement
or the consummation by either Company or the Shareholder of the transactions
contemplated hereby and no consent of any third party is required to consummate
any of the transactions contemplated hereby.
5.7 Financial Information. Buyer has been provided with (i) audited
unconsolidated balance sheets of Triangle and the Subsidiary as of December 31,
1997, 1996 and 1995 and the related statements of income (or with respect to the
Subsidiary, statements of operations), changes in stockholders equity (or with
respect to the Subsidiary, changes in retained earnings) and cash flows for the
years then ended, and (ii) the audited consolidated financial statements of
Triangle and Subsidiary as of December 31, 1998, which are attached to the
Disclosure Schedule (the information referred to in clause (i) and (ii) is
referred to as the "Financial Information"). Except as set forth on the
Disclosure Schedule, the Financial Information (a) is in accordance with the
books and records of the applicable Company, (b) presents fairly in all material
respects the operations and financial condition of the applicable Company for
the periods and as of the dates indicated and (c) was prepared in accordance
with generally accepted accounting principles (except, in the case of the
unaudited Financial Information, for the omission of recurring year end audit
adjustments and the omission of footnotes).
5.8 No Undisclosed Liabilities, Claims, Etc. Except as set forth on the
Disclosure Schedule, neither Company has any outstanding liabilities or
obligations, whether accrued, absolute, contingent or otherwise, relating to the
Business and exceeding Fifty Thousand Dollars ($50,000) or liabilities in the
aggregate exceeding Two Hundred Fifty Thousand Dollars ($250,000), except (i) to
the extent reflected or taken into account in determining net worth in the most
recent balance sheet for the applicable Company included in the Financial
Information and required to be accrued under generally accepted accounting
principles consistently applied; (ii) to the extent specifically set forth in or
incorporated by express reference in the Disclosure Schedule or any of the other
schedules or information attached hereto; (iii) normal liabilities incurred in
the ordinary course of business since December 31, 1998, and (iv) the Contracts.
It is expressly agreed that Buyer shall have no claim for breach of the
foregoing warranty related to an undisclosed liability which is not assumed by
Buyer under Article IV, except as otherwise provided by Article X.
5.9 Litigation. Except as set forth in the Disclosure Schedule, there is no
claim, action, suit, proceeding, arbitration, investigation or hearing or notice
of hearing pending or, to the best of Seller's knowledge, threatened, against
either Company or any of the Assets or with respect to the transactions
contemplated by this Agreement. No such claim, action, suit, proceeding,
arbitration, investigation or hearing will prevent the closing of this Agreement
or the consummation of the transaction contemplated hereby. There are no
unsatisfied judgments against the Seller, the Business, the Assets or the
Shareholder.
5.10 Taxes. Except as set forth in the Disclosure Schedule, (a) each
Company has prepared and filed, with the appropriate foreign, federal state and
local tax authorities, all income, excise and other Tax Returns required to be
filed by it related to the Business as of the date hereof and each Company has
paid all Taxes shown on such returns to be due or which have become due pursuant
to any assessments, deficiency notice, 30 day letter or similar notice received
by it; (b) there are no claims pending or threatened for Taxes against either
Company attributable to the Business known to the Seller in excess of the
amounts reflected on the books and the Financial Information for such Taxes for
the applicable Company; (c) each Company has paid or provided adequate reserves
for all Taxes attributable to the Business of the Company; (d) no deficiencies
on either Company's Tax Returns or reports attributable to or otherwise
allocable to the Business known to the Seller have been threatened in writing as
of the date hereof; and (e) each Company has made all withholding required to be
made under all applicable federal, state, local and foreign laws and regulations
with respect to compensation paid to employees and amounts withheld have been
properly paid over to the appropriate authorities.
5.11 Accounts Receivable and Accounts Payable. (a) All Accounts Receivable
reflected on the Financial Information, and to be in existence on the Closing
Date, represent sales actually made or leases entered into in the ordinary
course of business or valid claims as to which substantial performance has been
rendered. Except as set forth in the Disclosure Schedule or to the extent
reserved against, no material counterclaims or offsetting claims with respect to
the Accounts Receivable are pending or, to the knowledge of the Seller,
threatened. The listing of Accounts Receivable attached to the Disclosure
Schedule is true and correct (including the aging thereon) as of the date of
preparation and no material change has occurred since the date of preparation,
except in the ordinary course of business. All such Accounts Receivable are
collectible in the ordinary course of business except to the extent of reserves
therefor as of the Closing Date. For purposes of determining collectability,
cash received from account debtors without reference to specific invoice shall
be applied to the oldest outstanding invoice to such account debtor, unless a
bona fide dispute exists with respect to such invoice.
(b) The accounts payable of each Company reflected on the Financial
Information and to be in existence on the Closing Date arose, or will
arise, from bona fide transactions in the ordinary course of business, and
all such accounts payable either have been paid, are not yet due and
payable under the applicable Company's payment policies and procedures or
are being contested by the applicable Company in good faith. The listing of
accounts payable attached to the Disclosure Schedule is true and correct as
of the date of preparation and no material change has occurred since that
date, except in the ordinary course of business.
5.12 Inventory. The Inventory is (a) except to the extent of normal scrap
quantities incurred in the production process and except to the extent of
reserves therefore in the Financial Information, salable or usable in the normal
course of the Business, (b) at levels consistent with the ordinary course of
business and consistent with past practices of the Business, and (c) carried on
the books of each Company pursuant to the normal inventory valuation policies of
the applicable Company, as reflected in the applicable Financial Information.
5.13 Absence of Certain Changes or Events. Except as set forth on the
Disclosure Schedule, since December 31, 1998, each Company has conducted its
Business only in the ordinary course and consistent with past practices and the
Companies have not:
(a) suffered any damage, destruction or loss of any of the Assets,
whether or not covered by insurance, in excess of Fifty Thousand Dollars
($50,000);
(b) suffered any change in the financial condition of the Companies or
suffered any other event or condition of any character which individually
or in the aggregate had or has a Material Adverse Effect;
(c) paid, discharged or satisfied any claims, liabilities or
obligations (absolute, accrued, contingent or otherwise) except in the
ordinary course of business;
(d) waived any claims or rights of substantial value of the Companies
taken as a whole, except in each case in the ordinary course of business;
(e) pledged or permitted the imposition of any lien on (other than
Permitted Liens and the Assumed Liabilities) or sold, assigned, transferred
or otherwise disposed of any of the Assets, except the sale of Inventory in
the ordinary course of business;
(f) made any change in any method of accounting or accounting
principle or practice;
(g) except for de minimus adjustments, written up or down the value of
the Inventory or determined as collectible any notes or Accounts Receivable
of or arising out of the Business that were previously considered to be
uncollectable, except for write-ups or write-downs and other determinations
in the ordinary course of business and consistent with past practice;
(h) granted any general increase in the compensation payable or to
become payable to its officers or employees (including any such increase
pursuant to any bonus, pension, profit-sharing or other plan or
commitment), or any special increase in the compensation payable or to
become payable to any such officer or employee, or made any bonus payments
to any such officer or employee, except for normal merit and cost of living
increases in the ordinary course of business and in accordance with past
practice;
(i) entered into any employment agreements with any employees;
(j) sold, assigned or transferred any of the Assets except in the
normal course of business;
(k) executed any amendment, cancellation, or termination of any
contract, license, or other instrument material to the Business (other than
an amendment to the TriEnda Agreement which provides for dispute resolution
with respect to additional amounts payable by Triangle);
(l) failed to repay any material obligation, except where such failure
would not have a Material Adverse Effect;
(m) failed to operate the Business in the ordinary course or to
preserve the Business intact, to keep available to the Buyer the services
of the employees of the Companies and to preserve for the Buyer the
goodwill of the Companies' suppliers, customers, and other having business
relations with it, except where such failure would not have a Material
Adverse Effect;
(n) declared, set aside or paid any dividends or distributions in
respect of any outstanding securities of the Seller, any redemption,
purchase, or other acquisition of any of the Seller's outstanding
securities, or any other payments, including the payment of any amounts due
on obligations of Seller to its shareholders or directors other than
distributions and repayment of amounts due shareholders necessary for the
payment of taxes and other than intercompany transactions;
(o) incurred indebtedness for borrowed money or any commitment to
borrow money by the Seller (other than borrowing under the Magna Bank N.A.
line of credit), or any loans made or agreed to be made by the Seller, or
any guarantee, assumption, endorsement of, or other assumption of any
obligation by Seller with respect to any liabilities or obligations of any
other Person;
(p) incurred any liability involving Fifty Thousand Dollars ($50,000)
or more, or any increase or change in any assumptions underlying or methods
of calculating any bad debt, contingency, or other reserves of the Seller
except for (i) purchases of raw materials (including utilities, contract
manufacturing and subassembling) in the ordinary course of business in
accordance with past practice, (ii) payroll accruals in the ordinary course
of business in accordance with past practice, (iii) intercompany debt, and
(iv) advertising, insurance premiums, sales commissions, and purchases of
tooling in the ordinary course of business in accordance with past
practice;
(q) issued any purchase order for an amount greater than One Hundred
Thousand Dollars, or group of related purchase orders, for an aggregate
amount in excess of One Hundred Thousand Dollars ($100,000), except for
purchases of raw materials (including contract manufacturing and
subassembling) in the ordinary course of business in accordance with past
practice;
(r) made individual capital commitments on behalf of or relating to
the Business in excess of One Hundred Thousand Dollars ($100,000);
(s) failed to maintain accounts receivable, inventory, accounts
payable and other tangible capital accounts relating to the Business;
(t) entered into any individual agreement to provide goods or services
that would result in a loss (based on the knowledge of Seller and current
market and economic conditions) at the gross profit level in an amount
greater than One Hundred Thousand Dollars ($100,000); or
(u) agreed, whether in writing or otherwise, to take any action
described in this Section 5.13.
5.14 Contracts and Commitments. Schedule 1.1(a) and 4.1(d) and the
Disclosure Schedule contain a complete and accurate list of (i) with respect to
Seller, sales by part numbers for parts with revenues for the most recently
completed fiscal year in excess of One Hundred Thousand Dollars ($100,000) and
purchases by part number with costs for the most recently completed fiscal year
in excess of One Hundred Thousand Dollars ($100,000), and with respect to
Subsidiary, a listing of sales by part numbers for parts with revenues for the
most recently completed fiscal year in excess of One Hundred Thousand Dollars
($100,000) and purchases from vendors for the most recently completed fiscal
year which aggregated more than One Hundred Thousand Dollars ($100,000) and (ii)
all other Contracts, and all other material agreements and commitments, whether
written or oral, that are not in the ordinary course of business (collectively,
the "Commitments"). Except as set forth on the Disclosure Schedule, (i) all of
the Commitments are in full force and effect and enforceable against the other
parties thereto in accordance with their terms; and (ii) no event has occurred
or circumstance exists which, with the giving of notice or the lapse of time or
both, would constitute a material default or a material event of default by
either Company under any of the Commitments, and to the Seller's knowledge no
event has occurred or circumstance exists that, with the giving of notice or the
lapse of time or both, would constitute a default or an event of default under
any of the Commitments by any other party thereto (it being understood in all
cases that unless otherwise set forth, sales and purchases are made on open
purchase orders without long term commitment by either party).
Schedule 5.14 lists all:
(a) employment, consulting, bonus, profit-sharing, percentage
compensation, deferred compensation, pension, welfare, retirement, stock
purchase or stock option plans and agreements with any employees,
directors, agents or affiliates, excluding agreements terminable by the
Seller on not more than 30 days' notice without liability or penalty;
(b) notes, mortgages, contracts, agreements, and commitments for the
repayment or borrowing of money by either Company in excess of $25,000 in
any one case, or for a line of credit including borrowings by either
Company in the form of guarantees of, indemnification for, or agreements to
acquire any obligations of others, and all security or pledge agreements
related thereto;
(c) contracts, agreements, and commitments relating to any joint
venture, partnership, strategic alliance, or sharing of profits or losses
with any person;
(d) contracts, agreements, and commitments containing covenants
purporting to limit the freedom of either Company or any of their employees
to compete in any business or in any geographic area
(e) contracts, agreements, and commitments requiring payments or
distributions to the Shareholder, any director or employee of either
Company, or any relative or affiliate of any such person;
(f) contracts, agreements, and commitments not disclosed on any other
Schedule to this Agreement and which involve or may involve the payment or
receipt by either Company (whether in payment of a debt, as a result of a
guarantee or indemnification, for goods or services, or otherwise) of more
than $100,000 per year or $200,000 over the initial term thereof, or are
otherwise material to the Business; and
(g) contracts not made in the ordinary course of business;
Schedule 5.14 identifies whether each of the plans, notes, mortgages,
contracts, agreements, and commitments listed thereon are Contracts. The Seller
has made true and complete copies of all the foregoing plans, notes, mortgages,
contracts, agreements, and commitments available to the Buyer.
Except as set forth in Schedule 5.14, there are no material transactions
relating to the Business presently pending or planned or initiated or completed
since December 31, 1998 between either Company and the Shareholder, any
director, or any employee of either Company, or any relative or affiliate of any
such person, including any contract, agreement, or other arrangement (i)
providing for the furnishing of material services by either Company, (ii)
providing for the rental of material real or personal property by either
Company, or (iii) otherwise requiring material payments from either Company
(other than for services as officers or directors of either Company) to any such
person or corporation, partnership, trust, or other entity in which any such
person has a substantial interest as a shareholder, officer, director, trustee,
or partner.
5.15 OSHA, Environmental. (a) Except as set forth on the Disclosure
Schedule, neither Company has received any written notice from a governmental
authority that its operations or Assets have not been in the preceding three
fiscal years or are presently not in compliance with OSHA and any applicable
state provisions and to the knowledge of the Seller the Assets and operations of
each Company related to the Business are in material compliance with OSHA and
any similar or related applicable state law provisions.
(b) Except as set forth on the Disclosure Schedule or in the Phase I
Reports:
(i) Neither Company has deposited or caused to be deposited, on,
under or about any facility of either Company, including without
limitation into the ambient air, surface water, groundwater, land
surface, or subsurface strata, any Hazardous Substances, except in
compliance with Environmental Laws, and to the knowledge of the
Seller, no such disposal has been made by any owner or prior lessee of
any facility of either Company;
(ii) Neither Company has used any facility owned or leased by it
to generate, manufacture, refine, transport, treat, store, handle,
dispose, transfer, produce, process or in any manner deal with
Hazardous Substances, except in compliance with applicable
Environmental Laws;
(iii) Each Company has obtained all required registrations,
permits, licenses, and other authorizations which are required under
federal, state and local laws and regulations relating to pollution or
protection of the environment, including, but not limited to, all
Environmental Laws and including all laws relating to emissions,
discharges, releases, or threatened releases of Hazardous Substances
or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous
Substances;
(iv) Each Company is in compliance in all material respects with
all terms and conditions of required registrations, permits, licenses
and authorizations, and is also in compliance with all other material
limitations, restrictions, conditions, standards, prohibitions,
requirements, obligations, schedules and timetables contained in the
Environmental Laws or contained in any regulation, code, plan, order,
decree, judgment, injunction, notice or demand letter issued, entered,
promulgated or approved thereunder;
(v) There is no civil, criminal, or administrative action, suit,
demand, claim, hearing, notice of violation, investigation,
proceeding, notice or demand letter pending or threatened with respect
to either Company relating in any way to (a) the violation of
Environmental Laws or any regulation, code, plan, order, decree,
judgment, injunction, notice or demand letter issued, entered,
promulgated, or approved thereunder, or (b) the release into the
environment of any Hazardous Substances, whether or not occurring at
or on a site owned, leased or operated by either Company;
(vi) There is no lien or encumbrance on any Blin Controlled Real
Property or to the knowledge of Seller, any other Real Property
imposed in accordance with any Environmental Law; and
(vii) Each Company has timely filed all reports, obtained all
required approvals, generated and maintained all required data,
documentation and records required by the Environmental Laws or any
regulation, code, plan, order, decree, judgment, injunction, notice or
demand letter issued, entered, promulgated, or approved thereunder.
5.16 Customers and Vendors. The Disclosure Schedule sets forth correct and
complete lists of the customers of each Company which resulted in revenues
during the most recently completed fiscal year in excess of Five Hundred
Thousand Dollars ($500,000) ("Customers") and vendors ("Vendors") of each
Company during the most recently completed fiscal year which resulted in
expenditures by a Company in such fiscal year in excess of Five Hundred Thousand
Dollars ($500,000). Except as set forth in the Disclosure Schedule, there are no
outstanding material disputes with any Customer or Vendor listed thereon and no
Customer or Vendor listed thereon has refused to continue to do business with
either Company or has stated in writing, or to Seller's best knowledge, orally,
to either Company its intention not to continue to do business with either
Company in any material respect. Since December 31, 1997, there has not been any
material shortage or unavailability of the raw materials necessary to
manufacture the products sold by either Company, and, to the knowledge of the
Seller, there is no current shortage or unavailability which leads it to believe
that any such shortages will occur within 12 months from the date hereof.
5.17 Books and Records. The books of account and other financial and
corporate records of each Company related to the Accounts Receivable, Inventory
and fixed assets of the applicable Company are in all material respects
substantially complete and correct and are maintained in accordance with good
business practices.
5.18 Employment Matters. (a) Except as provided in the Disclosure Schedule,
each Company is in material compliance with all laws, rules and regulations
respecting employment, employment practices, terms and conditions of employment
and wages and hours with respect to employees of the applicable Company. Each
Company has withheld all amounts required by law or agreement to be withheld
from the wages or salaries of, and other payments to, its employees and any
former employees and is not liable for any arrearage of wages, salaries or other
payments to such employees and any former employees or any taxes or penalties
for failure to comply with any of the foregoing.
(b) Except as set forth on the Disclosure Schedule, and except for the
Union Contract, there are no pending demands for recognition of a union as
collective bargaining agent for- all or any part of the employees of either
Company. Except as set forth on the Disclosure Schedule, and except for the
Union Contract, neither Company is a party to any collective bargaining or
other labor agreement and there is no unfair labor practice charge or
complaint against either Company pending or to the knowledge of either
Company, threatened before the National Labor Relations Board or any other
comparable authority. There is no labor strike, dispute, slowdown, or
stoppage actually pending or, to the knowledge of Seller, threatened
against or involving either Company; no attempt to organize any group or
all of the employees of either Company has been made or proposed in the
last 5 years; no grievance or arbitration which might have a Material
Adverse Effect on either Company or the Business is pending and, to the
knowledge of the Seller, no claim therefor exists; no private agreement
restricts either Company from relocating, closing, or terminating any of
its operations or facilities; and neither Company has in the past 5 years
experienced any work stoppage or other labor difficulty or committed any
unfair labor practice.
5.19 Employee Benefit Plans. (a) Each retirement plan of each Company that
is intended to be a tax qualified plan (the "Plan") has been and is being
operated in accordance with the documents and instruments governing such Plan,
and such documents and instruments are consistent with those provisions of the
Employee Retirement Income Security Act of 1974 and the regulations adopted
pursuant thereto ("ERISA") which are effective and operative as of the date of
this Agreement, except to the extent that such documents and instruments have
not yet been amended for certain changes in laws and regulations. To the best of
the Seller's knowledge, no Plan has incurred any material accumulated funding
deficiency within the meaning of Section 302 of ERISA, whether or not waived,
and neither Company has incurred any material liability with respect to the Plan
that is not reflected in the Financial Information in accordance with generally
accepted accounting principles. To the best of the Seller's knowledge, no Plan
nor any trust created thereunder nor any trustee or administrator thereof has
engaged in a prohibited transaction within the meaning of ERISA or Section 4975
of the Code for which an exception is not available. At no time has either
Company contributed to or had any employees of the Business who were covered by
any defined benefit plan, including any multiemployer plan, as such term is
defined in Section 3(37) of ERISA, which is a defined benefit plan. Each Company
shall make all requested Contributions to each Plan within the period required
by ERISA and the Code.
(b) The Disclosure Schedule contains a list of each "employee pension
benefit plan" (as defined in section 3(2) of ERISA), "employee welfare
benefit plan" (as defined in Section 3(l) of ERISA), pension plan, stock
option, stock purchase, deferred compensation plan or arrangement, and
other employee fringe benefit plan or arrangement currently maintained,
contributed to or required to be maintained or contributed to by Seller for
the benefit of any present employees of the Business or their dependents
(all the foregoing being herein called "Benefit Plans"). Seller has
delivered or made available to Buyer true, complete and correct copies of
(1) each Benefit Plan (or, in the case of any unwritten Benefit Plans,
descriptions thereof) and (2) the most recent summary plan description for
each Benefit Plan (if any such description was required).
(c) Each Benefit Plan has been operated and is being operated in
material compliance with all applicable requirements of the Internal
Revenue Code, as amended, including all applicable regulations thereunder
("Code"), and ERISA, and in accordance with the documents and instruments
governing such Benefit Plan, except to the extent that such documents and
instruments have not yet been amended for certain changes in laws and
regulations, which amendments are not yet legally required.
5.20 Employees. The Disclosure Schedule sets forth a complete and accurate
list of all employees of each Company as of the date set forth therein, showing
for each: name, hire date, current job title or description, current salary
level and any bonus, commission or other remuneration paid during the most
recently completed fiscal year. Except as set forth on the Disclosure Schedule,
as of the date hereof none of the employees (including leased employees) of'
either Company is currently on short-term or long-term disability, absence,
maternity or other leave of absence.
5.21 Finder. There is no person or entity that is entitled to a finder's
fee or any type of commission in relation to or in connection with the
transactions contemplated by this Agreement as a result of any agreement or
understanding with either Company or the Shareholders, other than the fees of
▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc. which are payable by Seller.
5.22 Sufficiency of Assets. Except as otherwise provided in this Agreement
or the Disclosure Schedule and except for the Excluded Assets and any consent to
assignment of a contract, license or permit, which is not received prior to
Closing, the Assets to be transferred by each Company at the Closing Date will
include all of such Company's assets, including fixed assets, intangible assets,
licenses, permits, contracts and rights that relate to, arise from, are used or
held by such Company in the operation of the Business as presently conducted.
5.23 Governmental Authorizations. Each Company has all licenses, permits or
other authorizations from governmental, regulatory or administrative agencies or
authorities required for the operation of its Business in the manner presently
conducted, each of which will be in full force and effect on the Closing Date
except to the extent failure to obtain any such license does not have a Material
Adverse Effect. A list of all such material governmental authorizations is set
forth on the Disclosure Schedule.
5.24 Compliance with Applicable Laws. Except as set forth in Schedule 5.24,
each Company has been for the prior fiscal year, is, and on the Closing Date
will continue to be, in material compliance in all respects with all applicable
laws (including duties imposed by common law), rules, regulations, orders,
ordinances, judgments and decrees of all governmental authorities (federal,
state, local and foreign) having jurisdiction over, applicable to or otherwise
concerning its Business, Assets, and the products and employees of the
applicable Company, except to the extent any non-compliance would not have a
Material Adverse Effect.
5.25 Title to Assets, Absence of Liens and Encumbrances, Etc.
(a) Schedule 2.1(d) contains a summary description of all of each
Company's material fixed assets (other than the Real Property and the
Excluded Assets). As of the Closing Date and except for the Assumed
Liabilities and subject to Section 2.4, each Company will own all right,
title and interest in and to its Assets, free and clear of all liens,
encumbrances, security interests, options and pledges, other than Permitted
Liens.
(b) The leases and other agreements or instruments included in the
Contracts, under which each Company holds, leases or is entitled to the use
of any real or personal property used in the Business, are in full force
and effect and all rentals, or other payments payable thereunder prior to
the date hereof have been duly paid and each Company enjoys peaceable and
undisturbed possession under all such leases.
5.26 Intellectual Property. Section 5.26 of the Disclosure Schedule lists
all United States and foreign (a) registered patents and patent applications,
(b) registered trademarks and service marks and (c) registered copyrights (the
"Owned Intellectual Property"). Section 5.26 of the Disclosure Schedule also
sets forth a list of license agreements pursuant to which either Company
licenses Intellectual Property (the "Licensed Intellectual Property"). The Owned
Intellectual Property and the Licensed Intellectual Property are referred to
herein as the "Scheduled Intellectual Property." The Scheduled Intellectual
Property, together with commercially available software, trade secrets and
know-how in the possession of employees of the Companies, and flow sheets and
other technical documents available at the premises of the companies and
included in the Assets, includes all Intellectual Property necessary for the
conduct and operation of the business as presently conducted. Except as set
forth on Section 5.26 of the Disclosure Schedule, and except for the Licensed
Intellectual Property, all Intellectual Property material to the Business is
owned by Seller or the Subsidiary, free and clear of all Liens, validly issued
and enforceable and to the knowledge of Seller is not subject to any challenge.
Neither Company is aware of any facts that would invalidate or render any
Intellectual Property unenforceable. Except as disclosed on Section 5.26 of the
Disclosure Schedule, (a) there are no licenses now outstanding or other rights
granted to third parties to use any Intellectual Property, and (b) neither
Seller, the Subsidiary or the Shareholder is a party to any agreement or
understanding with respect to any Intellectual Property. Except as described on
Section 5.26 of the Disclosure Schedule, there are no material unresolved claims
made, and there has not been communicated to Seller or the Subsidiary, the
threat of any such claim, that any of the Intellectual Property or activities of
seller or the subsidiary in connection with the Intellectual Property
constitutes unfair competition or is in violation or infringement of any patent,
trademark, trade name, service ▇▇▇▇, trade dress, right of publicity, copyright,
or application or registration therefor, of any other Person. All patentable
technology invented by any employees of either Seller or the Subsidiary has been
validly transferred to Seller or the Subsidiary.
5.27 Real and Leased Property.
(a) Except as set forth on the Disclosure Schedule, there are no
physical or mechanical defects in any of the improvements on the Blin
Controlled Real Property which would materially impair the intended use of
the Blin Controlled Real Property, and all such improvements are in good
operating condition and repair (subject to normal wear and tear);
(b) Except as set forth on the Disclosure Schedule, the current use
and operation of the Blin Controlled Real Property are fully entitled,
without restriction or conditions, and are in compliance with applicable
codes, ordinances, rules, laws, regulations and requirements, including,
without limitation, those applicable to subdivisions, construction of
improvements, zoning, land use, public safety, and the Americans with
Disabilities Act (collectively, "Property Laws"), except for such
restrictions or conditions or such non-compliance as could not reasonably
be expected to have a Material Adverse Effect, and Seller has received no
written notice of non-compliance with any Property Laws which has not been
resolved;
(c) There are no zoning or other land-use regulation proceedings or
any change or proposed change in any applicable Property Laws, which could
detrimentally affect the use or operation of the Blin Controlled Real
Property, except for such proceedings, changes or proposed changes as could
not reasonably be expected to have a Material Adverse Effect, and Seller
has not received written notice of any special assessment proceedings
affecting the Blin Controlled Real Property which has not been resolved;
(d) All water, sewer, gas, electric, telephone and drainage facilities
and all other utilities required by law or for the present use and
operation of the Blin Controlled Real Property are installed to the
property lines of the Blin Controlled Real Property, are all connected and
operating pursuant to valid permits, are adequate to service the Blin
Controlled Real Property and to permit compliance with all Property Laws
and the present usage of the Blin Controlled Real Property, and are
connected to the Real Property by means of one or more public or private
easements extending from the Blin Controlled Real Property to one or more
public streets, public rights-of-way or utility facilities except as would
not have a Material Adverse Effect;
(e) Each Company has obtained all approvals, easements and
rights-of-way (and all such items are currently in full force and effect)
required from private parties for the present use and operation of the Real
Property owned by it and to ensure free and unimpeded vehicular and
pedestrian ingress to and egress from the Real Property as required to
permit the present usage of the Real Property owned by it except as would
not have a Material Adverse Effect;
(f) The Subsidiary is the sole owner of good, marketable and insurable
fee simple title to the Real Property designated as owned by it on Schedule
1.1(b), free and clear of all liens, security interests, covenants,
conditions, rights-of-way, easements and encumbrances of any kind or
character whatsoever, subject only to the Permitted Encumbrances, the
Assumed Liabilities as noted in the Schedules hereto. Seller is the sole
owner of good, marketable and insurable fee simple title to the Real
Property designated as owned by it on Schedule 1.1(b), free and clear of
all liens, security interests, covenants, conditions, rights- of-way,
easements and encumbrances of any kind or character whatsoever, subject
only to the Permitted Encumbrances, the Assumed Liabilities as noted in the
Schedules hereto. The Blin Corporation is the owner of the Real Property
designated as owned by it on Schedule 1.1(b);
(g) Neither Company has committed or obligated itself in any manner
whatsoever to sell the Owned Real Property, or any portion thereof, to any
party other than Buyer. Except with respect to Permitted Encumbrances and
Permitted Liens, neither Company has hypothecated or assigned any rents or
income from the Owned Real Property, or any portion thereof, in any manner
except pursuant to secured financing to be assumed or discharged at
Closing.
(h) Except as set forth in Section 5.27, none of the Leased Real
Property is subject to any sublease or grant to any person of any right to
the use, occupancy, or enjoyment of the property or any portion thereof.
Except as set forth on Schedule 5.27, the Leased Real Property is not
subject to any Liens (other than the lien, if any, of current property
taxes and assessments not in default). The Leased Real Property is not
subject to any use restrictions, exceptions, reservations, or limitations
which in any material respect interfere with or impair the present and
continued use thereof in the ordinary course of the Business. There are no
pending or, to the knowledge of Seller, threatened condemnation proceedings
relating to any of the Leased Real Property.
(i) The Warehouse Leased Property is adequate for the uses to which it
is put.
5.28 Personal Property. (a) Each Company has a legal, valid and binding
leasehold interest in all leased personal property used by it.
(b) Except as set forth in the Disclosure Schedule, all material
tangible personal properties and assets of each Company which are used by
it are in all material respects structurally sound and are in operating
condition and repair (subject to normal wear and tear) and are adequate for
the uses to which they are put, except for such required routine
replacement, maintenance and repair, which, if not performed, could not
reasonably be expected to have a Material Adverse Effect on the Business
and except for routine replacements, to be performed in the future pursuant
to Triangle's capital budget as set forth in its 1999 Business and plan and
Subsidiary's capital budget set forth in its business plan dated February
9, 1999.
5.29 Year 2000.
(a) Each Company has conducted an initial review of whether its
systems, processes, products, equipment and services are "Year 2000 Ready."
Interim results of such review are set forth on Schedule 5.29. "Year 2000
Ready" means that the systems, processes, products, equipment and services
of each Company (including any software embedded in any products)
("Services"), will correctly identify, recognize and process four-digit
year dates, and the Services will: (1) continue to function properly with
regard to dates before, during and after the transition to year 2000
including, but not limited to, the ability to roll dates from December 31,
1999 to January 1, 2000 and beyond with no errors or system interruptions;
(2) accurately perform calculations and comparisons on dates that span
centuries; (3) accept and properly process dates that could span more than
100 years (e.g., calculating a person's age from their birth date and the
current date); (4) properly sort and sequence dates that span centuries;
(5) understand that the year 2000 starts on a Saturday; (6) recognize that
February 29, 2000 is a valid date and that the Year 2000 has 366 days; (7)
prohibit use of date fields for any purpose other than to store valid
dates; and (8) preclude the use of 12/31/99 or any other valid date to
indicate something other than a date (e.g., 12/31/99 in a date field means
"do not ever cancel"). To the knowledge of the Company, and except as set
forth on Schedule 5.29, the Company's systems, processes and equipment are
Year 2000 Ready except where the failure to be ready would not have a
Material Adverse Effect.
(b) Each Company has conducted an audit of its critical contractors
and suppliers regarding their Year 2000 Readiness. To the best knowledge of
the Seller, the Year 2000 Readiness of such critical contractors and
suppliers is as set forth on Schedule 5.29.
(c) Each Company has made no express or implied warranties to any
third party regarding the Year 2000 Readiness of themselves, or any of
their Services, except as set forth on Schedule 5.29.
ARTICLE VI
REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF
THE BUYER
The Buyer hereby represents, warrants and covenants to and agrees with the
Seller as follows, all of which representations, warranties and agreements are
made as of the date of this Agreement and as of the Closing Date:
6.1 Organization, Etc. The Buyer is a corporation duly organized and
validly existing under the laws of its state of incorporation. The Buyer has the
corporate power to execute, deliver and perform this Agreement and consummate
the transactions contemplated hereby.
6.2 Authorization of Agreement. The execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated hereby have
been duly authorized and approved by the Board of Directors of the Buyer. This
Agreement constitutes, and the documents to be executed at Closing, upon
execution and delivery thereof, will constitute, valid and binding obligations
of the Buyer enforceable in accordance with their terms, except that such
enforcement may be limited by (a) bankruptcy, insolvency or other similar laws
affecting the enforcement of creditors' rights generally, and (b) general
principles of equity, regardless of whether enforcement is sought in a
proceeding in equity or at law.
6.3 Approvals. Except for filings under the HSR Act, no consent or approval
is required of any person or entity, private or governmental, for the execution,
delivery and performance of this Agreement and the documents to be delivered at
Closing by the Buyer, and the execution, delivery or performance, nor the
consummation of the transactions contemplated herein, do not breach any
provision of the Buyer's Articles of Incorporation or Bylaws or any law, rule,
regulation, judgment, order, decree, agreement, instrument or arrangement that
would have a material adverse effect on the Buyer's ability to perform its
obligations hereunder.
6.4 Finder. There is no person or entity that is entitled to a finder's fee
or any type of commission in relation to or in connection with the transactions
contemplated by this Agreement as a result of any agreement or understanding
with the Buyer, other than the fees of CIBC ▇▇▇▇▇▇▇▇▇▇▇ Corp., which are payable
by the Buyer.
6.5 Effect of Agreement, Etc. The execution, delivery and performance of
this Agreement by the Buyer and consummation by Buyer of the transactions
contemplated hereby will not, with or without the giving of notice and the lapse
of time, or both, (a) violate any provision of law, statute, rule or regulation
to which the Buyer is subject, (b) violate any judgment, order, writ or decree
of any court applicable to the Buyer, or (c) result in the breach of or conflict
with any term, covenant, condition or provision of, result in the modification
or termination of, constitute a default under, or result in the creation or
imposition of any lien, security interest, restriction, charge or encumbrance
upon any of the Assets pursuant to the Articles of Incorporation or Bylaws of
the Buyer, or any commitment, contract or other agreement or instrument to which
the Buyer is a party or by which any of the Assets is or may be bound or
affected or from which the Buyer derives benefit.
6.6 Projections. In connection with Buyer's investigation of the Business,
Buyer has received from Seller certain estimates, projections, forecasts, plans,
budgets and pro-forma information. Buyer acknowledges that there are
uncertainties inherent in attempting to make such estimates, projections,
forecasts, plans, budgets and pro-forma information, that Buyer is familiar with
such uncertainties, that Buyer is taking full responsibility for making its own
evaluation of the adequacy and accuracy of all estimates, projections,
forecasts, plans, budgets and pro-forma information furnished to it and that
Buyer will not assert any claims against Seller or its subsidiaries or
affiliates or any of their respective directors, officers, employees, agents or
representatives or hold any of them liable in connection with such estimates,
projections, forecasts, plans, budgets and pro forma information.
6.7 Financial Condition. Buyer has the liquidity and financial condition to
consummate the transaction without any financing (except for any financing or
commitments therefore in place as of the date hereof) and knows of no reason why
it cannot timely consummate the transactions contemplated herein prior to the
time set forth in the first sentence of Section 8. 1.
ARTICLE VII
COVENANTS OF THE PARTIES
7.1 Operation Of Business Prior To Closing. Between the date hereof and the
earlier of the termination of this Agreement pursuant to Article XI hereof or
the Closing Date:
(a) Negative Covenants. Seller covenants and agrees with Purchaser
that, except (1) as contemplated by this Agreement, or (2) with the prior
written consent of Buyer, which consent shall not be unreasonably withheld
or delayed, it shall not, and it will not permit Subsidiary to, do any of
the following with respect to the Business and the Assets other than in the
ordinary course of business:
(i) sell or otherwise dispose of any material Assets, cancel
any debts or claims involving any person related to the Business
or Assets, or pledge, assign or otherwise convey, or cause any
lien to be placed upon any Asset other than Permitted Liens or
the Assumed Liabilities;
(ii) amend its Articles of Incorporation or Bylaws in any
way that could reasonably be expected to have a Material Adverse
Effect either on the Business and the Assets or on the prospects
for consummating the transactions contemplated by this Agreement
(it is agreed the foregoing covenant expressly excludes any
restatement of the Subsidiary's Articles of Incorporation and
By-laws to make such documents consistent with Seller's
documents);
(iii) permit its corporate existence or any permit to be
suspended, lapsed, revoked or modified in any way that could
reasonably be expected to have a Material Adverse Effect;
(iv) amend or terminate any material contract in a manner
that would have a Material Adverse Effect;
(v) except as would not be material, allow any insurance
policy relating to the Business or any Asset to be amended or
terminated without replacing such policy with a policy providing
substantially equivalent coverage, insuring comparable risks and
issued by an insurance company financially comparable to the
prior insurance company; and
(vi) except as would not be material or except pursuant to
any agreements disclosed in the Disclosure Schedule or for normal
salary adjustments consistent with past practice, increase any
benefits payable, termination pay policies or employment
agreements with any employee of the Business.
(b) Affirmative Covenants. Seller shall use all reasonable efforts, in
the ordinary course of business, to:
(i) operate the Business in the normal course and maintain its
assets and properties used in the Business, reasonable wear and tear,
damage by fire and other casualty excepted;
(ii) comply in all respects with all applicable laws affecting
the Business, except for such noncompliance as could not reasonably be
expected to have a Material Adverse Effect;
(iii) pay accounts payable of the Business in accordance with its
past practice;
(iv) preserve its relationships with customers of and suppliers
to the Business and others having business relations with the
Business; and
(v) promptly following the Closing, request third parties who
received confidential information in connection with the sale of the
business to destroy such information and certify in writing that such
information has been destroyed.
7.2 Approvals, Consents, Etc. Each party shall use its reasonable efforts
to consummate the transactions contemplated hereby prior to the time set forth
in Section 8.1 and to obtain in writing prior to the Closing Date all Closing
Approvals in order to effectuate the transactions contemplated hereby and to
assume the Assumed Liabilities and shall deliver to the other party copies of
such approvals and consents in form and substance reasonably satisfactory to the
other party. Buyer and Seller shall proceed diligently and in good faith to make
and coordinate filings under the HSR Act as promptly as practicable (and in no
event more than five business days subsequent to the execution of this
Agreement) and to the extent feasible shall make such filings on the same date
and each of Buyer and Seller shall request early termination of the waiting
period.
7.3 Further Assurances. After the Closing Date, the Seller shall, at the
request and expense of the Buyer, execute, acknowledge and deliver to the Buyer
without further consideration, all such further assignments, conveyances,
endorsements, consents and other documents as the Buyer may reasonably request
(a) to transfer to and vest in the Buyer and protect its right, title and
interest in, all of the Assets, (b) to aid in the collection of Accounts
Receivable, (c) obtain any consent required to an assignment of a Contract or a
Commitment, and (d) otherwise to consummate the transactions contemplated by
this Agreement. Buyer shall take such action to further and more completely
evidence the assumption and performance of the Assumed Liabilities as shall be
reasonably requested by Seller. Buyer shall provide Seller with reasonable
assistance to process information and payments with respect to liabilities not
assumed by Buyer, so long as Seller reimburses Buyer for all payments made and
any direct out-of-pocket costs in connection therewith.
7.4 Access Prior to Closing. Prior to the Closing Date (or if earlier, the
date this Agreement is terminated), and except as set forth in Section 7.9, the
Seller shall provide the Buyer and its representatives with reasonable access
to, and will make available for inspection and review, all properties, books,
records and accounts, and with prior approval of Seller, personnel, of each
Company relating to the Business in order that the Buyer may have a reasonable
opportunity to make such investigation as it shall desire to make of the
Business during normal business hours.
7.5 Turn Over. Seller shall promptly remit to Buyer after receipt any funds
received after the Closing Date with respect to the Contracts and Assets to be
transferred hereunder or any other funds remitted by customers of the Business
after the Closing Date which are part of the Assets acquired hereunder.
7.6 Seller's Employees, Retirement Benefits. (a) Prior to the Closing Date,
the Buyer shall make employment offers to the employees on Section 5.20 of the
Disclosure Schedule ("Transferred Employees") (except those designated as having
been terminated) and such employment offer shall include comparable salaries (or
comparable hourly compensation) and benefits and so that such employees shall
retain their employment dates for purposes of eligibility and vesting for
benefits under Buyer's benefit plans. Provided however, that no Transferred
Employee shall count any period before his or her employment by the Buyer or be
eligible for the service factor portion of the security contribution under the
Alltrista Corporation Retirement and Savings Plans. Buyer shall notify Seller of
its plans to comply with the preceding sentence in a timely fashion prior to the
Closing and at such time provide Seller with any offer letter and other
materials to be used in connection with such offer. Buyer may establish one or
more retirement plans for eligible Transferred Employees (or, at Buyer's option,
amend existing retirement plan(s) to cover eligible Transferred Employees)
providing for an employer contribution level at least as great as that provided
by Seller or Subsidiary, as applicable, prior to Closing. Contingent on Buyer's
successful assumption of stop any insurance policies (including stop loss
policies), administrative service agreements and preferred provider coverage
commitments underlying the Companies' medical plans, Buyer may also establish a
medical plan or plans for the eligible Transferred Employees, whose benefits
shall mirror those under the medical plans of the Companies, which shall
continue through the remainder of the calendar year including the Closing Date.
The Seller and the Companies shall cooperate with Buyer's efforts to assume the
policies, agreements, and commitments referred to in the preceding sentence. For
one year from the Closing, Buyer shall pay any employee hired hereunder who
Buyer terminates without cause with a severance in accordance with the
applicable Company's involuntary severance policy in effect on the Closing (with
any such employee receiving full credit for its past service with the applicable
Company); provided, however, that the terms of this Section 7.6 shall not
prevent Buyer after the Closing Date (a) from modifying the terms and conditions
of such compensation and benefits, or (b) from terminating the employment of any
Transferred Employees.
7.7 Access After the Closing. Seller shall afford Buyer reasonable access
to the Excluded Assets and Excluded Records (including related computers and
computer records) or core corporate records retained by Seller if necessary to
operate the Business and Buyer shall afford Seller reasonable access to records
acquired hereunder and to the Transferred Employees to the extent necessary for
Seller to operate its business, to prepare its tax returns and to prepare the
Closing Date Statement. After the Closing Buyer shall afford Seller reasonable
access to any records acquired hereunder for legitimate business purposes.
7.8 Taxes. (a) Payment; Filing Returns. Seller shall pay all state and
local sales, transfer, excise, value-added, or other similar taxes (including
without limitation, all state and local taxes in connection with the transfer of
the Owned Real Property) and any deficiency, interest, or penalty asserted with
respect thereto, and all recording and filing fees that may be imposed by reason
of the sale, transfer, assignment, or delivery by Seller of the Assets. Seller
shall be responsible for the preparation and filing of all required Tax Returns
and (except for Taxes assumed by Buyer hereunder) shall be liable for the
payment of any and all Taxes relating to all periods through the Closing Date
(including all Taxes resulting from the sale and transfer by Seller of Assets
hereunder).
(b) Cooperation. The parties hereto agree to furnish or cause to be
furnished to one another, upon request, as promptly as practicable, such
information and assistance relating to the Assets, the Assumed Liabilities
and the Business as is reasonably necessary for the filing of all Tax
Returns, and making of any election related to Taxes, the preparation for
any audit by any taxing authority, and the prosecution or defense of any
claim, suit or proceeding relating to any Tax Return. The parties hereto
shall cooperate with each other in the conduct of any audit or other
proceeding related to taxes involving the Business and each shall execute
and deliver such other documents as are necessary to carry out the intent
of this Section 7.8(a). Buyer shall retain possession of all files and
records transferred to Buyer hereunder and coming into existence after the
Closing Date which relate to the Business before the Closing Date, for a
period not to exceed five (5) years from the Closing Date. Buyer shall
cooperate with Seller to retain records for a longer period if reasonably
requested by Seller and shall not dispose of records related to
environmental issues at the Portage facility and bedliner production and
litigation without reasonable prior notice to Seller. In addition, from and
after the Closing Date, upon reasonable notice and during normal business
hours, Buyer shall provide access to Seller and its attorneys, accountants,
and other representatives, at Seller's expense, to such files and records
as Seller may reasonably deem necessary to properly prepare for, file,
prove, answer, prosecute, and/or defend any such return, filing, audit,
protest, claim, suit, inquiry, or other proceeding.
(c) Allocations. All property taxes levied with respect to the Real
Property and any personal property included in the Assets for a taxable
period that includes (but does not end on) the Closing Date shall be
apportioned between Seller and Buyer as of the Closing Date based on the
number of days of such taxable period included in the Pre-Closing Tax
Period and the number of days of such taxable period included in the
Post-Closing Tax Period. Seller shall be liable for the proportionate
amount of such taxes that is attributable to the Pre-Closing Tax Period,
and Purchaser shall be liable for the proportionate amount of such taxes
that is attributable to the Post-Closing Tax Period. Utility payments shall
also be allocated among Buyer and Seller based on the portion of the
relevant period that such person occupied the property. Within a reasonable
period after the Closing, Seller and Buyer shall present a statement to the
other setting forth the amount of reimbursement to which each is entitled
under this Section 7.8(b), together with such supporting evidence as is
reasonably necessary to calculate the proration amount. The proration
amount shall be paid by the party owing it to the other within thirty (30)
days after delivery of such statement. Buyer and Seller shall cooperate
prior to the Closing to agree mutually acceptable allocations with respect
to any other cost typically allocated in connection with similar real
property closings.
7.9 Environmental Matters. Buyer acknowledges receipt of the Phase I
Reports and acknowledges such reports are sufficient to conclude its Phase I
environmental investigation of the Real Property. Buyer shall not conduct any
other environmental assessments or studies without the written approval of
Seller and Shareholder.
7.10 No Solicitation. From the date hereof until the Closing Date or the
date this Agreement is terminated pursuant to Article XI and except with respect
to the permitted disposition of assets in the ordinary course of business, the
Seller shall not, and shall ensure that each of its and the Subsidiary's
directors, officers, consultants, counsel, accountants, investment advisors and
other such representatives and agents shall not, solicit or entertain offers
from, negotiate with, or enter into any agreement with, any third party relating
to the acquisition of any of the Assets, in whole or in part other than
dispositions of Inventory in the ordinary course of business.
7.11 Confidentiality. (a) Each of the parties hereto agrees that it will
not use, or permit the use of, any of the information relating to any other
party hereto or the Assets or the Business with respect to the transactions
contemplated herein ("Information") in a manner or for a purpose detrimental to
such other party or otherwise than in connection with the transaction, and that
they will not disclose, divulge, provide or make accessible (collectively,
"Disclose"), or permit the Disclosure of, any of the Information to any person
or entity, other than their respective directors, officers, employees,
investment advisors, accountants, counsel and other authorized representatives
and agents (who shall be bound by this Section 7.11), except as may be required
by judicial or administrative process or, in the opinion of such party's
counsel, by other requirements of law; provided, however, that prior to any
Disclosure of any Information permitted hereunder, the disclosing party shall
first obtain the recipients' undertaking to comply with the provisions of this
subsection with respect to such information. The term "Information" as used
herein shall not include any information relating to a party which the party
disclosing such information can show: (i) to have been in its possession prior
to its receipt from another party hereto; (ii) to be now or to later become
generally available to the public through no fault of the disclosing party;
(iii) to have been available to the public at the time of its receipt by the
disclosing party; (iv) to have been received separately by the disclosing party
in an unrestricted manner from a person entitled to disclose such information;
or (v) to have been developed independently by the disclosing party without
regard to any information received in connection with this transaction. Each
party hereto also agrees to promptly return to the party from whom it originally
received such information all original and duplicate copies of written materials
containing Information should the transactions contemplated herein not occur. A
party hereto shall be deemed to have satisfied its obligations to hold the
Information confidential if it exercises the same care as it takes with respect
to its own similar information.
7.12 Non-Competition. (a) Each of Triangle, Shareholder and Subsidiary
acknowledge that in and as a result of its ownership of the Assets or other
interest in Triangle or Subsidiary, it has made use of, acquired, and/or added
to confidential information of a special and unique nature deriving independent
economic value, actual or potential, from not being generally known to, and not
being readily ascertainable by proper means by, other persons who can obtain
economic value from its disclosure or use (specifically excluding any
information generally available to the public at large or disclosed by Buyer to
third parties or any information disclosed because Triangle, Shareholder, or
Subsidiary has a legal obligation to make such disclosure). Such information is
hereinafter referred to as "Confidential Information" and includes, without
limitation, the following information: customers, vendors, products, systems,
data files, manuals, confidential reports, the amounts paid by or to customers,
licensers, licensees, and vendors, the amounts paid for products and services,
and other trade secrets and information Triangle, Shareholder, or Subsidiary
knows or has reason to know, or will know or have reason to know, Buyer intends
or expects to remain confidential. As a material inducement to Buyer to enter
into this Agreement, each of Triangle, Subsidiary and Shareholder covenants and
agrees that it shall not from and after the Closing and for a period of five (5)
years following the Closing Date, divulge or disclose for any purpose whatsoever
any Confidential Information except to the extent such information is or becomes
generally available to the public at large or disclosed by Buyer to third
parties or any information disclosed because Seller, the Subsidiary or
Shareholder has a legal obligation to make such disclosure. Notwithstanding the
foregoing, Seller, Triangle and Shareholder may reveal Confidential Information
to the extent reasonably necessary to determine amounts due ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ pursuant to the TriEnda Agreement, or to enforce rights under
the TriEnda Agreement, including furnishing such information to investment
bankers, appraisers, lawyers, accountants, courts and arbitrators.
(b) During the five year period following the date of this Agreement,
each of Triangle, Shareholder and Subsidiary shall not, except as may be
required by law or as may be done with Buyer's written consent, directly or
indirectly, either as a shareholder, member, principal, co-partner, agent,
financier, lender, consultant, manager or in any other individual or
representative capacity whatsoever (i) engage in any activities competitive
with the Business or the pallet logistics or refurbishing business in the
United States of America, (ii) solicit, serve, divert or assist any person
in so soliciting, servicing or diverting any customers or vendors of Buyer
or any of its affiliates to the extent such actions are related to the
Business in the United States of America, (iii) solicit the employment of
any of the employees of Triangle or Subsidiary that are employed by Buyer
pursuant to this Agreement. The foregoing shall not apply to the activities
of (i) Shareholder with respect to his actions on the Board of Directors of
Alloyd Incorporated and (ii) any entity of which Triangle, Subsidiary or
any Triangle Shareholder owns or beneficially owns less than ten percent
(10%) of the outstanding voting power.
(c) Buyer and each of Triangle, Shareholder and Subsidiary each agree
that the terms and covenants contained in this Section 7.12 herein are fair
and reasonable in all respects to protect the legitimate interests of
Buyer, including the geographical coverage and time period, and that these
restrictions are designed for the reasonable protection of Buyer's
business. Each of Triangle, Shareholder and Subsidiary recognize that any
breach of this Section 7.12 will cause irreparable injury to the goodwill
and proprietary rights of Buyer, inadequately compensable in monetary
damages. Accordingly, in addition to any other legal or equitable remedies
that may be available to the Buyer, each of Triangle, Shareholder and
Subsidiary agree that Buyer will be able to seek to obtain immediate
injunctive relief in the form of a temporary restraining order, preliminary
injunction, or permanent injunction against each of Seller, Shareholder and
Subsidiary to enforce this Agreement.
7.13 [Reserved]
7.14 Bedliner Litigation. Buyer shall make available management of Buyer to
Shareholder and Seller to assist in the defense of current and future litigation
related to the production of bedliners and any disputes with Penda Corporation.
Such assistance shall include preparation for deposition and court testimony and
time incurred for depositions and testimony. Seller shall reimburse Buyer for
out-of-pocket costs incurred in connection therewith. If requested by Seller,
Buyer will reasonably cooperate with Seller's efforts to secure insurance
against present and future bedliner litigation (naming Seller and Shareholder as
an insured), and administer such insurance, provided that Seller and Shareholder
shall pay any costs associated with such insurance. Seller and Shareholder shall
take reasonable steps to minimize Buyer's management time and disruption in
accordance with the performance of this covenant.
7.15 Enforcement. Triangle agrees, at the request and expense of Buyer, to
enforce the rights of Triangle against other parties to the TriEnda Agreement
and the parties to any other agreement in which Seller has acquired a business
from a third party; provided that (i) with respect to any matter for which money
damages would be adequate, Seller may at its option elect to pay such money
damages (without prejudice to Buyer's rights under Article X of this Agreement)
and (ii) Buyer is not also recovering duplicative damages from Seller and
Shareholder under this Agreement.
7.16 Corporate Name. Notwithstanding anything else in this Agreement,
Seller may continue to use current corporate names for a period of ninety (90)
days following the Closing. Sellers shall use reasonable efforts to change their
name prior to such date.
7.17 Portage Remediation. Buyer shall continue to remediate groundwater at
the Portage facility in accordance with current practice for so long as Buyer
owns the Portage facility to the extent that remediation remains a requirement
under applicable governmental orders or consent agreements with the State of
Wisconsin; provided, however, that the foregoing covenant shall not require
Buyer to continue to operate the Portage facility. For so long as Buyer
continues to remediate environmental conditions in the groundwater at Portage,
Wisconsin, Buyer, at its expense, shall provide Seller and Shareholder with
copies of all groundwater monitoring reports submitted to the State of Wisconsin
and shall also notify Seller of any material change from the current remediation
practice or any material change in groundwater contamination. In the event Buyer
ceases operation at the Portage facility or materially reduces groundwater
pumping remediation from Sellers' current practice in connection with operations
without the consent of the Sate of Wisconsin, Buyer, at its expense, shall
install and operate other comparable remediation devices reasonably satisfactory
to Seller and Shareholder, provided that the initial cost thereof does not
exceed $100,000. Buyer shall cause any subsequent transferee of the Portage
facility in a manner which also bind subsequent transferees to assume this
covenant for the benefit of Seller and Shareholder.
7.18 Shareholder Net Worth. For a period of five (5) years from the Closing
Date, Shareholder shall maintain a personal net worth of at least $15,000,000.
No later than March 31 of 2000, 2001, 2002, 2003 and 2004, Shareholder shall
provide Buyer with an unaudited written confirmation from Shareholder's
independent public accountant that the Shareholder's personal net worth at such
date is in excess of $15,000,000.
7.19 Certain Permit Applications. Not later than two business days
following the execution of this Agreement, Buyer shall provide Seller with (i) a
listing of requested operating or similar permits reasonably necessary to
operate Sellers facilities, or (ii) requested documentation supporting the
conclusion that such permits are in force or are not reasonably required for the
facilities of Seller where the Business is operated. Buyer shall promptly
respond in writing to any analysis from Shareholder stating a particular permit
is not necessary. Seller and Shareholder shall use their best efforts to secure
the requested permits and/or documentation prior to Closing, it being understood
that obtaining such permit is not a condition to Closing unless the failure to
have a permit or permits constitutes a Material Adverse Change. Seller and
Shareholder shall promptly provide Buyer with copies of any permit or related
documents filed with any governmental authorities. All expenses incurred by
Seller or Shareholder in connection with their obligations under this Section
7.19 shall be paid by Shareholder. At least three (3) business days prior to the
Closing Date, Seller shall provide Buyer with a written summary of action taken
and the status of any governmental filings.
ARTICLE VIII
CLOSING
8.1 Closing. The closing (the "Closing") of the transactions contemplated
hereby shall occur five (5) business days after the conditions to closing in
this Article VIII have been met. The Closing will be held at the offices of
▇▇▇▇▇▇▇, Street and Deinard, P.A., Suite 2300, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ at 10:00 a.m. or at such other time and place as the
parties mutually agree. The date upon which the Closing occurs is referred to
herein as the "Closing Date."
8.2 Buyer's Conditions to Closing. The obligations of the Buyer under this
Agreement are subject to the satisfaction of the following conditions as of the
Closing Date, any or all of which conditions may be waived by the Buyer in its
sole discretion:
(a) Accuracy of Representations, Warranties and Agreements. The
representations and warranties made by the Seller and the Shareholder
herein shall be true and correct on the date of this Agreement and at the
Closing Date with the same effect as though made at such time (except to
the extent the Buyer shall waive the same). The Seller and the Shareholder
shall have performed and complied in all material respects with all
agreements, covenants and conditions required by this Agreement to be
performed and complied with by it at or prior to the Closing Date and the
Seller and the Shareholder shall have delivered to the Buyer a certificate
certifying to such compliance and completion.
(b) Consents and Approvals, HSR. The Buyer shall have received all
Closing Approvals in form and substance reasonably satisfactory to the
Buyer. Any waiting period (and any extension thereof) under the HSR Act
applicable to the transactions contemplated hereby shall have expired or
been terminated.
(c) Transfer Documents. Each Company shall have executed and delivered
a ▇▇▇▇ of sale and deeds conveying the Assets to the Buyer in form
reasonably satisfactory to the Buyer and its counsel and any other
instrument required by Section 1.3 including assignments of contracts and
leases free and clear of all encumbrances other than Permitted Liens, the
Assumed Liabilities and other encumbrances noted in the Schedules and
Exhibits hereto.
(d) Motor Vehicles. Each Company shall have executed and delivered
certificates of title and assignments thereof for all motor vehicles
transferred to the Buyer as part of the Assets.
(e) Assets. Each Company shall have delivered a list of the Inventory,
Accounts Receivable and fixed assets as of the close of business on a date
as close as practicable to the Closing Date, which list shall be reasonably
satisfactory to Buyer.
(f) Litigation. No temporary restraining order, preliminary or
permanent injunction, or cease and desist order, issued by any court or
governmental authority preventing the transfers contemplated hereby or the
consummation of the Closing, shall be in effect at the Closing Date, and no
proceeding by any court or governmental authority seeking to restrict or
prohibit the transfer and exchange contemplated hereby or the consummation
of the Closing shall be pending or threatened on the Closing Date, except
for such proceedings which, if concluded successfully in such court or by
such governmental authority, could not reasonably be expected to have a
Material Adverse Effect.
(g) Secretary's Certificate. The Buyer shall have received a
certificate of the Secretary of each Company with respect to the
resolutions adopted by the Board of Directors and shareholders of each
Company, approving this Agreement and the transactions contemplated hereby.
(h) Good Standing Certificates, Etc.. The Buyer shall have received a
certificate dated within five (5) days before the Closing Date from the
office of the Secretary of State of the state of incorporation of each
Company certifying that the applicable Company is validly existing and in
good standing under the laws of its state of incorporation.
(i) Lien Search. The Seller, at its expense, shall have arranged for
and the Buyer shall have received UCC search reports, reasonably
satisfactory to the Buyer and its counsel, of a reputable search company
indicating that there are no liens, mortgages, encumbrances, charges or
other rights of third parties (other than Permitted Liens and the Assumed
Liabilities and encumbrances noted in the Schedules and Exhibits hereto) of
record with respect to each Company.
(j) Opinion of Counsel to the Seller. The Buyer shall have received
the opinion of ▇▇▇▇▇▇▇, Street and Deinard, PA, dated the Closing Date, in
the form set forth in Exhibit 8.2(j).
(k) Title Insurance. A commitment for an Owners Policy of Title
Insurance on an ALTA standard form shall have been issued to Buyer with
respect to the Owned Real Property, at Seller's expense, in such face
amounts as shall be agreed upon by Buyer and Seller prior to the Closing
Date.
(1) The Blin Corporation shall have entered into leases of the Leased
Real Property with Buyer in the form of Exhibit 8.2(l). --------------
(m) ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇ shall have entered into the
noncompetition agreements in the form attached hereto as Exhibit 8.2(m).
(n) The Buyer shall have received the Company's unaudited consolidated
financial statements as of February 28, 1999 and for the two months then
ended which, upon delivery, shall (i) be included within the definition of
"Financial Information" as set forth in Section 5.7 for all purposes of
this Agreement, and (ii) not reflect any Material Adverse Change.
(o) There shall not have been a material adverse change in the
condition of the Assets, operations, business, competitive position or
financial condition of Seller or the Subsidiary since the date of this
Agreement ("Material Adverse Change"); provided that no ruling on the
pending Rule 67 motion in the Cadillac litigation shall be considered a
Material Adverse Change.
8.3 Seller's and Shareholder's Conditions to Closing. The obligations of
the Seller and the Shareholder under this Agreement are subject to the
satisfaction of the following conditions as of the Closing Date, any or all of
which may be waived by the Seller and the Shareholder in its sole discretion:
(a) Accuracy of Representations, Warranties and Agreements. The
representations, warranties and agreements of the Buyer herein shall be
true and correct on the date of this Agreement and at the Closing Date
(except to the extent the Seller and the Shareholder waives the same); the
Buyer shall have performed and complied with all agreements, covenants, and
conditions to be performed or complied with by it in all material respects
at or prior to the Closing Date; and the Buyer shall have delivered to the
Seller and the Shareholder a certificate of an officer dated the Closing
Date certifying to such compliance and completion.
(b) Consents and Approvals. The Seller and the Shareholder shall have
received the Closing Approvals all in form and substance reasonably
satisfactory to the Seller. Any waiting period (and any extension thereof)
under the HSR Act applicable to the transactions contemplated hereby shall
have expired or been terminated.
(c) Litigation. No temporary restraining order, preliminary or
permanent injunction, or cease and desist order, issued by any court or
governmental authority preventing the transfers contemplated hereby or the
consummation of the Closing, shall be in effect at the Closing Date, and no
proceeding by any court or governmental authority seeking to restrict or
prohibit the transfer and exchange contemplated hereby or the consummation
of the Closing shall be pending or threatened on the Closing Date, except
for such proceedings which, if concluded successfully in such court or by
such governmental authority, could not reasonably be expected to have a
Material Adverse Effect.
(d) Secretary's Certificate. The Seller and Shareholder shall have
received a certificate of the Secretary of the Buyer with respect to the
resolutions adopted by the Board of Directors of the Buyer approving this
Agreement and the transactions contemplated hereby.
(e) Opinion of Counsel to the Buyer. Seller and Shareholder shall have
received the opinion of Ice ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇, counsel to the Buyer,
addressed to Seller, dated at the Closing Date, in the form set forth in
Exhibit 8.3(e) attached hereto.
(f) Purchase Price. The Purchase Price shall have been paid by wire
transfer in accordance with Section 3.1.
(g) Assumption Agreement. An Assumption Agreement, pursuant to which
the Buyer will assume all obligations of Seller under the Assumed
Liabilities in the form set forth as Exhibit 8.4(g) attached hereto.
(h) Release of Liabilities. Shareholder shall have been released of
all guarantees, liabilities, contingent liabilities and obligations related
to either Company and any related security interest or mortgage upon the
assets of Shareholder or his affiliates shall have been released.
(i) Real Estate Leases. Buyer shall have entered into the leases with
the Blin Corporation of the Leased Real Property in the form of Exhibit
8.2(l) (and with respect to the property in Independence, Iowa, such lease
shall not extend to the wing of the office building currently occupied by
Shareholder).
(j) Non-Competition Agreements. The noncompetition agreements set
forth in Section 8.2(m) shall have been entered into by the designated
employees and the Buyer.
(k) Iowa Taxation. Each Company and each Triangle Shareholder shall
not be subject to Iowa taxation as a result of the transactions to be
consummated on the Closing Date pursuant to Iowa Reg. Ruling No. 701
Section 40.38, as determined by the Shareholder.
(l) Buyer shall have entered into consulting agreements with the
Shareholder, ▇▇▇▇▇ ▇. ▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ on the form attached
hereto as Exhibit 8.3(l).
ARTICLE IX
DISPUTE RESOLUTIONARTICLEIXDISPUTERESOLUTION
9.1 Initial Meeting. In the event that there is a dispute arising out of or
relating to this Agreement (other than a dispute to be resolved pursuant to
Section 3.2 and other than a dispute with respect to leases of the Leased Real
Property) the parties shall attempt in good faith to resolve such disputes
promptly by negotiation between the parties. Any party may give the other
parties written notice that a dispute exists (a "Notice of Dispute"). The Notice
of Dispute shall include a statement of such party's position. Within ten (10)
days of the delivery of the Notice of Dispute, the parties shall meet at a
mutually acceptable time and place, and thereafter as long as they reasonably
deem necessary, to attempt to resolve the dispute. All documents and other
information or data on which each party relies concerning the dispute shall be
furnished or made available on reasonable terms to the other party at or before
the first meeting of the parties as provided by this Section 9. 1.
9.2 Mediation. If the dispute has not been resolved by negotiation within
thirty (30) days of the delivery of a Notice of Dispute, or if the parties have
failed to meet within ten (10) days of the Notice of Dispute, the parties shall
endeavor to settle the dispute by mediation under the then current CPR Model
Mediation Procedure for Business Disputes. Unless otherwise agreed, the parties
shall agree upon a mediator or, if they cannot agree upon a mediator, a mediator
selected by Seller, a mediator selected by Buyer and a third mediator selected
by those just selected by Buyer and Seller. Expenses of mediation shall be
divided equally between Seller and Buyer.
9.3 Binding Arbitration. Any controversy or claim arising out of or
relating to this Agreement or any agreement or document in connection therewith,
the breach, termination or validity thereof, or the transactions contemplated
herein (including any question arising as to whether or not any dispute falls
within the terms of this Section or the selection of arbitrators but excluding
any dispute to be resolved pursuant to Section 3.2 and excluding any dispute
with respect to the leases of the Leased Real Property) if not settled by
negotiation or mediation as provided in Section 9.1 and Section 9.2 shall be
settled by arbitration in Chicago, Illinois, in accordance with the CPR Rules
for Non-Administered Arbitration of Business Disputes, by an arbitrator mutually
acceptable to Seller and Buyer, or, if they cannot agree upon an arbitrator, an
arbitrator selected by Seller, an arbitrator selected by Buyer and a third
arbitrator selected by those just selected by Buyer and Seller. Any party may
initiate arbitration from and after 60 days following the delivery of a Notice
of Dispute if the dispute has not then been settled by negotiation or mediation.
The arbitration procedure shall be governed by the United States Arbitration
Act, 9 U.S. C. ss. 1-16, and the award rendered by the arbitrators shall be
final and binding on the parties and may be entered in any court having
jurisdiction thereof.
9.4 Discovery. Each party shall have discovery rights as provided by the
Federal Rules of Civil Procedure; provided, however, that all such discovery
shall be commenced and concluded within ninety (90) days of the initiation of
arbitration.
9.5 Expeditious Proceedings. It is the intent of the parties that any
arbitration shall be concluded as quickly as reasonably practicable. Unless the
parties otherwise agree, once commenced, the hearing on the disputed matters
shall be held four days a week until concluded, with each hearing date to begin
at 9:00 a.m. and to conclude at 5:00 p.m. The arbitrators shall use all
reasonable efforts to issue the final award or awards within a period of five
(5) business days after closure of the proceedings. Failure of the arbitrators
to meet the time limits of this Section 9.5. shall not be a basis for
challenging the award.
9.6 Attorneys' Fees. The arbitrators may instruct the non-prevailing party
to pay all costs of the proceedings, including the fees and expenses of the
arbitrators and the reasonable attorneys' fees and expenses of the prevailing
party, but only for the prevailing party that shall have complied with the
provisions of Sections 9.1 and Section 9.2 above. In the absence of such
instruction, Seller and Buyer shall be instructed to bear its own costs and to
pay one-half of the fees and expenses of the arbitrators.
9.7 Enforcement of Awards. Each party agrees that any legal proceeding
instituted to enforce an arbitration award hereunder may be brought in a court
of competent jurisdiction (either state or federal) in either Des Moines, Iowa,
or Indianapolis, Indiana and hereby submits to personal jurisdiction therein and
irrevocably waives any objection as to venue therein, and further agrees not to
plead or claim in any such court that any such proceeding has been brought in an
inconvenient forum.
9.8 Equitable Relief. Nothing herein shall be construed to prevent any
party from seeking equitable relief in any court of competent jurisdiction to
restrain or prohibit any breach or threatened breach of any covenant of the
parties set forth in this Agreement, whether or not the parties have first
sought to resolve the dispute through negotiation, mediation or arbitration
pursuant to this Article IX
ARTICLE X
INDEMNIFICATION
10.1 Indemnification by Seller. Triangle, Subsidiary and Shareholder
jointly and severally covenant and agree with the Buyer that it shall indemnify
the Buyer and its directors and officers, and their successors, assigns, heirs
and legal representatives ("Section 10.01 Indemnified Parties") and hold them
harmless from, against and in respect of any and all costs, losses, claims,
contribution claims, liabilities, fines, penalties, damages, response costs,
remedial action costs, clean-up costs and expenses (including interest which may
be imposed in connection therewith and court costs and fees and reasonable
disbursements of counsel) (hereinafter referred to as "Claims") arising out of
or with respect to:
(a) any liabilities or obligations of either Company arising prior to
the Closing Date (i) other than the Assumed Liabilities, (ii) except as set
forth in paragraph (c), other than any obligation associated with the
Cadillac litigation, and (iii) except as set forth in Section 10.1A, other
than with respect to Environmental Conditions disclosed in the Phase I
Reports or in the Disclosure Schedules;
(b) any breach of any of the representations, warranties, covenants or
agreements made by the Seller or the Shareholder in this Agreement or in
any certificate executed and delivered by either Company or Shareholder
pursuant hereto;
(c) for legal fees, costs and expenses (but not judgments, settlements
and the like) incurred in connection with the Cadillac litigation to the
extent such legal fees, costs and expenses do not exceed $500,000 (such
amounts shall be offset in equal shares for amounts due Shareholder and
▇▇▇▇▇ ▇. ▇▇▇▇ under consulting agreements entered into pursuant to Section
8.2(m)); and
(d) for any Claim associated with the litigation set forth on Schedule
10.1(d).
10.1A Portage Indemnity. (a) Triangle, Subsidiary and Shareholder shall
jointly and severally indemnify the Section 10.1 Indemnified Parties for all
Claims related to the presence, migration or release of Hazardous Substances
that result from currently known Hazardous Substances in the groundwater at the
Portage facility as set forth in the Phase I Reports (the "Portage Condition")
that result from Claims by third parties other than any Claim by any
governmental authority which does not seek to materially increase the type or
cost of remediation at the Portage facility.
(b) Notwithstanding the foregoing, the Section 10.1 Indemnified
Parties shall not be indemnified for (i) any Claim which resulted from
Buyer's exacerbation of the Portage Condition or any remediation or costs
incurred from construction on the Portage land by Buyer or (ii) any Claim
by a subsequent transferee of the Portage facility to the extent that such
Claim relates to costs incurred with respect to remediation in accordance
with current practice or such Claim relates to exacerbation (including
construction) of the Portage Condition by Buyer or any transferee.
10.2 Indemnification by Buyer. The Buyer hereby covenants and agrees with
the Seller that it shall indemnify each Company and each Triangle Shareholder
and each Company's directors, officers, and successors, heirs and legal
representatives ("Section 10.2 Indemnified Parties"), and hold them harmless
from, against and in respect of any and all Claims, arising out of or with
respect to:
(a) the operation of the Business or the Assets by the Buyer or its
successors, assigns or transferees on and following the Closing Date and
any liability arising after the Closing Date from the following caused by
Buyer: noncompliance with Environmental Law, any environmental
contamination, or presence, release of Hazardous Substances and the
handling, use treatment, removal, storage, decontamination, cleanup,
transport or disposal thereof, whether such contamination or Hazardous
Substances are located on or under the Real Property after the Closing
Date;
(b) the Buyer's assuming and agreeing to pay, perform and discharge
the obligations of each Company related to future performance to be
discharged or performed after the Closing Date under the Assumed
Liabilities or any failure to honor the terms and conditions of the Union
Contract; and
(c) any breach of any of the representations, warranties, covenants or
agreements made by Buyer in this Agreement or in any other certificate
executed and delivered by Buyer pursuant hereto.
10.2A Hold Harmless, Waiver and Release. (a) Buyer acknowledges it has
reviewed the Phase I Reports with respect to Portage, Wisconsin and acknowledges
it has been provided with the Phase I Reports which disclose the Portage
Conditions. Except as set forth in Section 10.1A, Buyer hereby expressly waives
and releases any present or future claim, it now has or may hereafter have
against the Companies and their officers, directors, shareholders (the "Seller
Parties") with respect to the Portage Conditions as they presently exist,
including any claim under CERCLA and present and future Environmental Laws.
(b) Buyer agrees to hold the Seller Parties Harmless from (i) any
Claim which resulted from Buyer's exacerbation of the Portage Condition or
any remediation or costs incurred from construction on the Portage land, or
(ii) any Claim by a governmental authority which does not seek to
materially increase the type or cost of remediation at the Portage facility
which relates to the Portage Conditions as they presently exist.
(c) Buyer expressly waives and releases any present or future Claim,
whether known or unknown, it now has or hereafter may have with respect to
any diminution in value of the Real Property in Portage Wisconsin, based on
the Portage Condition as disclosed in the Phase I Reports.
10.3 Limits. (a) (i) Except as set forth in paragraphs (ii), (iii) and
(iv), no claim for indemnification may be made by any party hereto except to the
extent the aggregate amount of such Claims by such party exceed one percent (1%)
of the adjusted Purchase Price (the "Basket") (and then only to the extent that
such claims exceed the Basket). In addition, no claim for indemnification shall
be made for any item that is less than Five Thousand Dollars ($5,000) ("Minimum
Claim").
(ii) No claim for indemnification shall be made by the Section
10.1 Indemnified Parties for breach of the representation and warranty
set forth in Section 5.11 except to the extent the aggregate amount of
such Claims exceed $250,000 (and then only to the extent that such
claims exceed such amount) (the "Receivables Basket"). The Minimum
Claim and Receivables Basket shall not apply to any Claim with respect
to nonpayment of amounts owed by Synergy World, Inc.
(iii) No claim for indemnification shall be made by the Section
10.1 Indemnified Parties for breach of the representation and warranty
set forth in Section 5.15(b) (i) and (ii) except to the extent the
aggregate amount of such Claims exceed $250,000 (and then only to the
extent that such claims exceed such amount).
(iv) No claim for indemnification shall be made by the Section
10.1 Indemnified Parties for breach of the representation and warranty
set forth in Section 5.15(b)(iii) through (vii) except to the extent
the aggregate amount of such claims exceeds $250,000 (and then only to
the extent that such claims exceed such amount).
(v) The Minimum Claim and Basket shall not apply to any Claim by
the Section 10.2 Indemnified Parties for indemnification from Buyer
with respect to (i) Buyer's failure to timely perform and discharge
the Assumed Liabilities or any failure to honor the terms and
conditions of the Union Contract and (ii) any payment or
indemnification due Seller pursuant to Sections 3.2, 7.8, 7.17,
10.2(a), or 10.2A(b) or, (iii) due the Section 10.1 Indemnified
Parties pursuant to Sections 3.2, 5.10, 5.25(a), 7.8, 10.1(c),
10.1(d), and 10.1A.
(b) The aggregate Claims indemnified against shall not exceed ten
percent (10%) of the adjusted Purchase Price (the "Cap"). The Cap shall not
apply to any Claim by the Section 10.2 Indemnified Parties for
indemnification from Buyer with respect to (i) Buyer's failure to timely
perform and discharge the Assumed Liabilities or any failure to honor the
terms and conditions of the Union Contract and (ii) any payment or
indemnification due the Section 10.2 Indemnified Parties pursuant to
Sections 3.2, 7.8, 7.17, 10.2(a), or 10.2A(b) or, (iii) due the Section
10.1 Indemnified Parties pursuant to Sections 3.2, 5.10, 5.25(a), 7.8,
10.1(c), 10.1(d), and 10.1A.
(c) No claim for indemnification shall be made (i) by either party for
indirect, special, consequential or punitive damages, (ii) by the Section
10.1 Indemnified Parties for any breach of any representation, warranty or
covenant of this Agreement by Seller or Shareholder of which Buyer has
knowledge prior to the Closing as a result of its due diligence
investigation or otherwise or (iii) with respect to any matter set forth in
Section 12.2, beyond the time period set forth in such Section.
(d) It is recognized that the Purchase Price payable hereunder has
been determined, in part, based on a multiple of earnings. Notwithstanding
the foregoing, no claim for an indemnity payment hereunder shall be made
based on a multiple of damages incurred, whether such claim relates to an
overstatement of prior earnings or other breach of a representation,
warranty or covenant, except in the case of fraud.
10.4 Procedure. (a) Promptly (and in any event within 15 days after the
service of any citation or summons) after acquiring knowledge of any Claim for
which one of the parties hereto (the "Indemnified Party") may seek
indemnification against another party (the "Indemnifying Party") pursuant to
this Article X, the Indemnified Party shall given written notice thereof to the
Indemnifying Party. Failure to provide notice shall not relieve the Indemnifying
Party of its obligations under this Article X except to the extent that the
Indemnifying Party demonstrates actual damage caused by that failure. The
Indemnifying Party shall have the right to assume the defense of any Claim with
counsel reasonably acceptable to the Indemnified Party upon delivery of notice
to that effect to the Indemnified Party. If the Indemnifying Party, after
written notice from the Indemnified Party, fails to take timely action to defend
the action resulting from the Claim, the Indemnified Party shall have the right
to defend the action resulting from the Claim by counsel of its own choosing,
but at the cost and expense of the Indemnifying Party. The Indemnified Party
shall have the right to settle or compromise any Claims against it, and, as the
case may be, recover from the Indemnifying Party any amount paid in settlement
or compromise thereof, if it has given written notice thereof to the
Indemnifying Party and the Indemnifying Party has failed to take timely action
to defend the same. The Indemnifying Party shall have the right to settle or
compromise any claim against the Indemnified Party without the consent of the
Indemnified Party provided that the terms of the settlement or compromise
provide for the unconditional release of the Indemnified Party and require the
payment of monetary damages only.
(b) Upon its receipt of any amount paid by the Indemnifying Party
pursuant to this Article X, the Indemnified Party shall deliver to the
Indemnifying Party such documents as it may reasonably request assigning to
the Indemnifying Party any and all rights, to the extent indemnified, that
the Indemnified Party may have against third parties with respect to the
Claim for which indemnification is being received.
10.5 Exclusive Remedy. The indemnification set forth in this Article X
shall be the sole and exclusive remedy of the parties against the other for
breach of the representations, warranties and covenants of this Agreement and
any Agreement or document executed in connection herewith, except for claims
arising from fraud.
10.6 Insurance and Taxes. Any claim for indemnification hereunder shall be
reduced by any insurance payment to be received by the party claiming
indemnification and any tax benefit to be realized by such indemnity with
respect to the matter for which indemnification is sought.
ARTICLE XI
TERMINATION
11.1 Termination. Anything in this Agreement to the contrary
notwithstanding, this Agreement may be terminated and the transactions
contemplated herein abandoned:
(a) by the mutual written consent of all of the parties hereto at any
time prior to the Closing.
(b) by the Buyer in the event of a breach by the Seller or Shareholder
of any provision of this Agreement, which breach is not remedied within ten
(10) days after receipt of notice thereof (or if earlier, the Drop Dead
Date);
(c) by the Seller or Shareholder in the event of a breach by the Buyer
of any provision of this Agreement, which breach is not remedied within ten
(10) days after receipt of notice thereof (or if earlier, the Drop Dead
Date);
(d) by either party if the Closing does not occur on or before May 1,
1999 (the "Drop Dead Date"). --------------
In the event this Agreement is terminated, no party shall have any
obligation or liability to the other party for the transactions contemplated
herein or for breach of any representation, warranty or covenant of this
Agreement or any document executed in connection herewith, except for the
provisions which survive pursuant to the next paragraph hereof
The provisions set forth in Article IX, this Section 11.1, and Sections
7.11, 12.1, 12.7 and 12.9 shall survive any termination.
11.2 Risk of Loss. The risk of loss to the Assets and all liability with
respect to injury and damage occurring in connection therewith shall remain with
and be the sole responsibility of the Seller until the time of the Closing.
ARTICLE XII
GENERAL
12.1 Expenses. The Buyer and the Seller shall pay their own respective
expenses and the fees and expenses of their respective counsel and accountants
and other experts. Shareholder shall reimburse Seller prior to Closing for all
legal fees and financial advisory fees paid prior to Closing in connection with
transactions contemplated by this Agreement.
12.2 Survival of Representations and Warranties. The representations,
warranties in this Agreement and in any ancillary certificate or document shall
survive the Closing for a period of one (1) year from the Closing Date, except
the representations and warranties contained in Section 5.15(b) shall survive
for a period of three (3) years from the Closing Date and the representations
and warranties contained in Sections 5.2, 5.4, 5.10, 5.25(a), 5.27(f), 6.2 and
6.6 which shall survive for the period of the applicable statute of limitations
and except for any representations and warranties which relate to the Portage
Condition which shall survive indefinitely. All covenants shall survive the
Closing for the applicable statute of limitations, except for Sections 7.17,
10.1A and 10.2A, which shall survive indefinitely.
12.3 Updates to Schedules. Seller may update the Schedules to reflect
changes permitted by this Agreement. For the purposes of determining the
accuracy as of the date hereof of the representations and warranties of Seller
and Shareholder as of the date hereof contained in Article V in order to
determine the fulfillment of conditions set forth in Section 8.2, the Disclosure
Schedule shall be deemed to exclude any information contained in any supplement
or amendment hereto delivered after delivery of the Disclosure Schedule.
12.4 Waivers. The waiver by any party hereto of a breach of any provision
of this Agreement shall not operate or be construed as a waiver of any
subsequent breach. The waiver by any party hereto at or before the Closing Date
of any condition to its obligations hereunder which is not fulfilled shall
preclude such party from seeking redress from the other party hereto for breach
of any representation, warranty, covenant or agreement contained in this
Agreement related to such waiver.
12.5 Binding Effect; Benefits; Assignment. This Agreement shall inure to
the benefit of and be binding upon the parties hereto and their respective
successors and permitted assigns, heirs and legal representatives. Except as
otherwise set forth herein, including the rights of the Triangle Shareholders
for indemnification, nothing in this Agreement, express or implied, is intended
to confer on any person other than the parties hereto or their respective
successors and permitted assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement. No party may assign its rights
hereunder without the consent of the other party except in connection with the
sale of substantially all of such party's assets; provided, however, that Buyer
may assign its rights to any wholly-owned subsidiary of Buyer, provided that
such subsidiary assumes the obligations of Buyer hereunder, such subsidiary
makes the representations and warranties of Buyer hereunder and Buyer
unconditionally guarantees the obligations of such Subsidiary hereunder and
under the documents executed at closing.
12.6 Notices. All notices, requests, demands and other communications which
are required to be or may be given under this Agreement shall be in writing and
shall be deemed to have been duly given when delivered in person or transmitted
by facsimile or three (3) days after deposit by certified or registered first
class mail, postage prepaid, return receipt requested, to the party to whom the
same is so given or made:
If to Triangle, Subsidiary, ▇▇▇▇▇ ▇. ▇▇▇▇
or the Shareholder, to: ▇▇ ▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇▇, Street and Deinard, P.A.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Buyer, to: Alltrista Corporation
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ICE ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address or facsimile number as such party shall have specified
by notice to the other party hereto.
12.7 Entire Agreement. This Agreement (including the Schedules and Exhibits
hereto) constitutes the entire agreement and supersedes all prior agreements and
understandings, oral and written, between the parties hereto with respect to the
subject matter hereof and cannot be changed or terminated orally. No
representations or warranties, express or implied, are made with respect to the
Business, either Company, Shareholder or the Assets except as expressly set
forth herein.
12.8 Headings. The Section and other headings contained in this Agreement
are for reference purposes only and shall not be deemed to be a part of this
Agreement or to affect the meaning or interpretation of this Agreement.
12.9 Governing Law. This Agreement shall be construed as to both validity
and performance and enforced in accordance with and governed by the laws of the
state of Minnesota, without giving effect to the choice of law principles
thereof
12.10 Amendments. This Agreement may not be modified or changed except by
an instrument or instruments in writing signed by the party against whom
enforcement of any such modification or amendment is sought.
12.11 Severability. The invalidity of all or any part of any
representation, warranty, covenant or indemnification Section of this Agreement
shall not render invalid the remainder of this Agreement or the remainder of
such Section. If any representation, warranty, covenant or indemnification
Section of this Agreement or portion thereof is so broad as to be unenforceable,
it shall be interpreted to be only so broad as is enforceable.
12.12 Press Releases. None of Seller, Shareholder or Buyer shall, and
Seller shall not permit the Subsidiary to, without the prior approval of the
other party, issue any press release or written statement for general
circulation relating to the transactions contemplated hereby, except as required
by law or the regulation of any stock exchange (but each party shall still
endeavor to allow the other party reasonable opportunity to review and comment
to the extent feasible).
12.13 Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original but all of which shall constitute one and the
same instrument. However, in making proof hereof it shall be necessary to
produce only one copy hereof signed by the party to be charged. Signature pages
delivered by facsimile to this Agreement or any document delivered in connection
herewith or at the Closing shall be binding to the same extent as an original.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed in their respective names by an officer thereunto duly authorized on the
date first above written.
SELLER: BUYER:
TRIANGLE PLASTICS, INC. ALLTRISTA CORPORATION
By: By:
--------------------------- -------------------------------------
Its: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------- President and Chief Executive Officer
SHAREHOLDER:
------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇
TRIENDA CORPORATION
By:
--------------------------
Its:
-------------------------
Exhibit 8.2(j)
(Subject to due diligence and review and approval by opinion committee.)
Seller's Opinion
______________1999 ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
612/▇▇▇-▇▇▇▇ (direct dial)
612/335-1657 (facsimile)
Alltrista Corporation
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Dear Sir or Madam:
We have acted as counsel to Triangle Plastics, Inc., an Iowa corporation
("Seller"), ▇▇▇▇▇ ▇. ▇▇▇▇ ("Shareholder") and TriEnda Corporation, a Wisconsin
corporation ("Subsidiary"), in connection with the Asset Purchase Agreement
dated as of ___________, 1999 (the "Agreement") among Seller, Subsidiary,
Shareholder and Alltrista Corporation, an Indiana corporation, a corporation
("Buyer"), and the ▇▇▇▇ of Sale, the Assignment and Assumption Agreement, the
deeds for the transfer of the Owned Real Property, and assignments of the Owned
Intellectual Property to be delivered under the Agreement (collectively, with
the Agreement, the "Documents"). This is the opinion contemplated by Section
8.2(j) of the Agreement. All capitalized terms used in this opinion without
definition have the respective meanings given to them in the Documents.
In rendering the opinion expressed below we have reviewed the Articles of
Incorporation and Bylaws of Seller and Subsidiary, the records of action of the
Board of Directors and shareholders of Seller and Subsidiary approving the
transactions contemplated by the Agreement, Certificates of Good Standing issued
by the Secretary of State of the States of Wisconsin and Iowa with respect to
Seller and Subsidiary, respectively, and the Documents. In all such reviews we
have (i) assumed the genuineness of all signatures, (ii) the due execution and
delivery of the Documents by all parties other than Seller, Shareholder and
Subsidiary and that the Documents are the legal, valid and binding obligations
of such parties, and (iii) each party to the Documents, other than the Seller,
Shareholder and Subsidiary has the full power, authority and legal right to
enter into and perform its obligations thereunder. We have also assumed the
accuracy of the representations and warranties in the Documents, the
authenticity of all documents submitted to us as originals, and the conformity
to authentic original or certified copies of all copies submitted to us as
conformed or reproduction copies. As to various questions of fact relevant to
our opinion, we have relied upon the representations and warranties in the
documents, statements of Shareholder and representatives of Seller and
Subsidiary and have not independently verified the accuracy of the information
so obtained. "Knowledge" means the actual knowledge of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇. ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇.
Our opinion is as follows:
1. Based solely upon the Certificate of Good Standing of Seller obtained
from the Secretary of State of the State of Iowa, and the Certificate of Good
Standing of Subsidiary obtained from the Secretary of State of the State
Wisconsin, Seller is a corporation validly existing under the laws of the State
of Iowa and Subsidiary is a corporation validly existing under the laws of the
State of Wisconsin.
2. Each of Seller and Subsidiary (i) has the corporate power to execute,
deliver and perform its obligations under the Documents to which it is a party,
(ii) has taken all necessary corporate action (including shareholder action) to
authorize the execution, delivery and performance of the Documents to which it
is a party and (iii) has duly executed and delivered the Documents to which it
is a party.
3. Shareholder has duly executed and delivered the Documents to which he is
a party.
4. The Documents to which Seller, Shareholder and Subsidiary are a party
are the valid and binding obligations of such party enforceable against such
party in accordance with their terms.
5. Neither the execution and delivery of the Documents nor the consummation
of the transactions contemplated thereunder by Seller, Shareholder and
Subsidiary (a) violates any provision of the Articles of Incorporation or Bylaws
of Seller or Subsidiary, or (b) violates any law, rule or regulation of the
United States of America or the State of Minnesota (a "Governmental Body") known
by us and normally considered, in our experience, in transactions of this
nature, or (c) to our knowledge, after giving effect to any consent received,
conflict with or violate or result in the creation or imposition of a lien,
charge or encumbrance upon any of the properties or assets of the Company or the
Subsidiary with respect to any contract set forth on Exhibit A hereto.
6. No approval of, or filing with, any Governmental Body is required in
connection with the execution, delivery and performance of the Documents by
Seller, Shareholder or Subsidiary pursuant to any law, rule or regulation or to
our knowledge, pursuant to any order, judgment, decree, agreement or other
instrument, other than (i) notification and termination of all applicable
waiting periods under the HSR Act, (ii) any approval or filing that may be
required in connection with the transfer of permits and government contracts and
(iii) filings and registrations necessary to record the transfer of the Owned
Intellectual Property.
As a matter of fact and not as a legal opinion, we hereby confirm to you
that to our knowledge, there is no action, proceeding, or investigation before
any court, governmental agency or other body or official pending or threatened
in writing against the Shareholder, the Company or the Subsidiary questioning
the validity of any action by the Company or the Subsidiary in connection with
the execution, delivery and performance of each of the Documents.
Our opinion is subject to the following qualifications:
(a) We are admitted to practice in the State of Minnesota, and we express
no opinion as to the laws of any jurisdiction other than the Federal law of the
United States of America, the laws of the State of Minnesota, the Iowa Business
Corporations Act and the Wisconsin Business Corporation Law;
(b) Our opinion in paragraph 4 above is subject to the effect of any
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance and similar laws affecting the enforcement of creditors' rights, and
to the effect of general principles of equity, including (without limitation)
concepts of materiality, reasonableness, good faith and fair dealing, and other
similar doctrines affecting the enforceability of agreements generally
(regardless of whether considered in a proceeding in equity or at law);
(c) With respect to the opinion set forth in paragraph 5(c), we have
assumed the laws of any state governing any contract set forth on Exhibit A are
the same as the laws of the State of Minnesota.
(d) We express no opinion or confirmation as to the right, title or
interest of the Seller, Shareholder or Subsidiary in any of the Assets or the
absence of any liens on any of the Assets or with respect to compliance with the
Federal Assignment of Claims Act;
(e) Our opinions and confirmation are limited to the specific issues
addressed and are limited in all respects to the laws existing on the date of
this letter and facts existing and known to us on the date of this letter;
(f) Our opinions and confirmation are given to you solely for purposes of
consummating the transactions contemplated in the Agreement. This letter may not
be relied upon by you for any other purpose, or by any other party for any
purpose whatsoever, or used, circulated, quoted or otherwise referred to without
our express prior written consent.
Sincerely,
▇▇▇▇▇▇▇ STREET AND DEINARD
PROFESSIONAL ASSOCIATION
By:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Exhibit A to Opinion Letter of ▇▇▇▇▇▇▇ Street and Deinard
1. Union Contract
2. TriEnda Corporation Stock Purchase Agreement between Triangle Plastics,
Inc. and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ dated January 2, 1998
3. Agreement of Pledge between Triangle Plastics, Inc., Boardman, Suhr, ▇▇▇▇▇
& Field, as Escrow Agent, and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ dated
January 2, 1998
4. Manufacturing Agreement between Triangle Plastics, Inc. and Synergy World,
Inc. dated June 16, 1998
5. Agreement between U.S. Postal Service and TriEnda Corporation dated October
2, 1998
6. Agreement between U.S. Postal Service and TriEnda Corporation dated
September 28, 1998
7. License Agreement between Penda Corporation (now TriEnda) and Cadillac
Products, Inc. dated July 1, 1991
8. Agreement among TriEnda Corporation and Shuert/Oakland, Inc. (d/b/a Shuert
Industries, Inc. and Shuert Industries Sales, Inc.), ▇▇▇▇ ▇▇▇▇▇▇, and
Packaging Solutions, Inc. dated June 7, 1996.
9. Technology Transfer Agreement between TriEnda Corporation and Flight Group
Limited dated October 1, 1996
10. Technology Transfer Agreement between TriEnda Corporation and PLM Plasticos
LTDA dated January 19, 1998
Exhibit 8.2(l)
Real Estate Leases
The attached form of lease shall be completed with the following terms and
conditions for the applicable parcel of Leased Real Property:
Parcel Base Rent Initial Term Expires Renewal Term Other Terms & Conditions
------ --------- -------------------- ------------ ------------------------
Independence $12,000 per month 5 years from closing Five years at $15,000 per Such lease shall not extend to the wing
month of the office building occupied by
Shareholder. Occasional use of
conference room at rate to be agreed.
FMV purchase option exercisable on six
months notice, with no notice delivered
for two years from closing.
Oelwein $18,000 per month 5 years from closing Five years at $20,000 per FMV purchase option exercisable on six
month months notice, with no notice delivered
for one year from closing.
Cookeville $11,000 per month 5 years from closing Five years at $12,000 per FMV purchase option exercisable on six
month months notice, with no notice delivered
for one year from closing.
LEASE
THIS LEASE (this "Lease") is made and entered into this ____ day
_____________of 1999, by and between THE BLIN CORPORATION, an Iowa corporation
whose address is __________________________ ("Landlord"), and Alltrista
Corporation, an Indiana corporation whose address is
____________________________________________ ("Tenant").
RECITALS
A. Landlord is the owner of certain improved land in the City of
_______________, ______________.
B. Tenant desires to lease from Landlord the land and improvements in order
to operate a manufacturing services facility thereon.
C. Landlord is willing to enter into such a lease and allow Tenant to
conduct such business, all on the terms, conditions and covenants hereinafter
set forth.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which each party hereby acknowledges, the parties agree as
follows:
ARTICLE I
PREMISES; AS IS; NET LEASE
1.1 Grant; Premises. In consideration of the full and timely performance by
Tenant of all the terms, conditions and covenants of this Lease, including
timely payment of all Base Rent and additional rent hereunder, Landlord does
hereby lease to Tenant, and Tenant does hereby lease from Landlord, that certain
parcel of improved land situated in the City of ________________, County of
___________________, State ______________ of _______________________ (the
"Property Jurisdiction") consisting of a building containing approximately
_______ square feet and including all fixtures, improvements, hereditaments and
appurtenances pertaining thereto, commonly known as [Street Address] the legal
description for which land (the "Land") is more particularly described in
Exhibit A attached hereto and incorporated herein and the building, parking lot
drive areas and any other improvements (the "Building and Improvements") being
more particularly shown on the site plan (the "Site Plan") attached hereto as
Exhibit A-1 and incorporated herein by reference (the Land and the Building and
Improvements are sometimes hereinafter collectively referred to as the
"Premises").
1.2 Subject to Taxes and Landlord's Title. The Premises are leased subject:
(a) to the lien of real estate taxes and installments of special assessments not
yet delinquent and interest thereon, and (b) to all title matters of public
record, to public streets and highways, to any matters that an accurate survey
or physical inspection of the Premises may show, and to all zoning, subdivision,
building and similar rules, regulations and ordinances now in effect that have
been reviewed and approved by Tenant as indicated by its execution of this Lease
or hereafter enacted.
1.3 Site Leased "As Is".
(a) Tenant takes the Premises in their present state and condition, "as is" and
without any obligation on the part of Landlord to make any alterations, changes,
improvements, repairs or replacements of any kind whatsoever. After inspection,
Tenant's taking possession of the Premises shall be conclusive evidence that the
Premises, including all fixtures, equipment and personal property thereon, were
in good repair and working order, and in clean and tenantable condition, at the
time possession was taken subject to Landlord's obligations under this Lease.
Landlord makes no covenants, representations or warranties as to the age,
quantity or condition of the Premises, their value, their fitness for any
specific purpose, or the title thereto (except as otherwise expressly stated in
this Lease), and no such covenants, representations or warranties shall be
implied.
(b) Nothing contained in this Section 1.3 will prejudice the rights of the
Tenant under a certain Asset Purchase Agreement between Tenant and Triangle
Plastics dated March ___, 1999 ("Asset Purchase Agreement").
1.4 Covenant for Quiet Enjoyment. Tenant shall and will, upon paying the
rent, taxes, assessments and insurance premiums and any other additional rental
payments herein provided to be paid by Tenant, and upon fully observing and
performing the terms, conditions and covenants herein provided to be observed
and performed by Tenant, quietly and peaceably hold and enjoy the Premises for
and during the full term of the lease, unless this Lease be sooner terminated as
provided herein.
1.5 Net Lease. It is the intention and purpose of the parties that, subject
to Landlord's express obligations under the Lease, this Lease shall be an
entirely "net lease" to the Landlord. Accordingly, during the lease term, any
extensions or renewals thereof, and any other holdover tenancy, Tenant shall pay
all costs or expenses of whatever character, nature or kind (other than those
costs or expenses that are Landlord's express responsibility under the terms of
this Lease, including Landlord's Major Building Systems Obligations (as defined
below) and to pay for any loss, costs, expenses or damages from Pre-Existing
Environmental Conditions) whether foreseen or unforeseen that may be necessary
with respect to (a) the operation and maintenance of the Premises, and (b)
Tenant's authorized use thereof during the entire term of this Lease. All
provisions of this Lease relating to costs and expenses are to be construed in
light of such intention and purpose to construe this Lease as a "net lease."
ARTICLE II
TERM; BASE RENT; SURRENDER; GUARANTY
2.1 Term; Lease Year. Tenant shall have and hold the Premises for a term of
five (5) years commencing on ______________________ (the "Commencement Date")
and extending until and including _____________________ (the "Expiration Date").
Each 12-month period commencing on January 1 and concluding on December 31 is
called a "Lease Year." The initial calendar year of the term, 1999, shall be a
"partial" Lease Year, as will the final calendar year of the Lease.
2.2 Base Rent. The "Base Rent" payable during the term of this Lease shall
be ___________ per Lease Year, payable in monthly installments of ____________
each. Base Rent for partial Lease Years shall be pro-rated on a calendar-year
basis.
2.3 Holding Over. Should Tenant continue to occupy the Premises after the
expiration or termination of this Lease, whether with or without the consent of
Landlord, such tenancy shall be on a month-to-month basis, and Base Rent shall
be increased to 150% of the Base Rent payable pursuant to Paragraph 2.2.
2.4 Payment of Base Rent; Late Charge.
(a) Tenant shall pay Base Rent to Landlord, without the necessity for demand,
and without setoff, counterclaim, abatement, recoupment, defense or deduction,
in advance on the first business day of each and every month during the term
hereof at Landlord's address set forth in the caption of this Lease, or such
other place as Landlord may from time to time designate in writing. If Base Rent
is not received by the tenth (10th) day of the month in which due, a late charge
equal to ten percent (10%) of the amount due shall be assessed and be
immediately due and payable. If the Commencement Date is not on the first day of
any month, Base Rent for such month shall be prorated and shall be payable on
the Commencement Date. Base Rent for the final month of the term of the Lease
shall also be prorated in the event the Expiration Date is not on the last day
of such month. For any partial month at the beginning or the end of the term of
this Lease, rent for such partial period shall be calculated by multiplying the
monthly installment of Base Rent due for the full month immediately following or
preceding (as the case may be) such partial month by a fraction, the numerator
of which shall be the number of days in such partial month, and the denominator
of which shall be the total number of days within the calendar month in which
such partial month falls.
(b) Subject to the provisions of Section 1.4, the obligation to pay Rent and
additional rent hereunder shall be absolute and unconditional and shall not, to
the fullest extent permitted by law, be affected by any circumstance, including
(i) any setoff, counterclaim, abatement, recoupment defense or deduction or
other right that Tenant or any person may have against Landlord or any person,
or (ii) any defect in title not affecting tenantability or habitability of the
premises or (iii) any other circumstance, happening or event whatsoever, whether
or not similar to the foregoing.
2.5 Tenant to Surrender Premises in Good Condition. Upon the expiration or
termination of the term of this Lease, Tenant shall at its own expense: (a)
remove from the Premises all moveable furnishings and other items of personal
property and equipment, including all such equipment purchased by Tenant under
the terms of the Asset Purchase Agreement (b) repair any damage or injury, and
make any necessary replacements, caused or necessitated by such removal,
ordinary wear and tear excepted; (c) remove, in compliance with law, any
"hazardous substances" as defined in Article XIII, that have been discharged or
stored by Tenant in, on or under the Premises; (d) remove all material
structural alterations not consented to by Landlord; and (e) quit and deliver up
the Premises to Landlord, peaceably and quietly, in as good order, condition and
repair as the same were on the date this Lease commenced, or were thereafter
placed in by Landlord, reasonable wear and tear, alterations to which Landlord
consented, other non-material, non-structural alterations and acts of God
excepted.
2.6 Renewal Term.
(a) Tenant shall have the option (the "Renewal Option") to extend the term of
this Lease for one additional five (5) year period (the "Renewal Term"), which
Renewal Term shall commence on the date immediately succeeding the Expiration
Date (the "Renewal Commencement Date") and end on the anniversary of the
Expiration Date (the "Renewal Expiration Date"), provided that this Lease shall
not have been previously terminated and that Tenant shall not be in material
default in the observance or performance of any of the terms, covenants or
conditions of this Lease (i) on the date Tenant gives Landlord written notice
(the "Renewal Notice") of Tenant's election to exercise the Renewal Option, and
(ii) on the Expiration Date. The Renewal Option shall be exercised with respect
to the entire Premises only and shall be exercisable by Tenant's delivery of the
Renewal Notice to Landlord at least six (6) months prior to the Expiration Date;
provided, however, if Tenant is in default on the date the Renewal Notice is
given or on the Expiration Date as hereinbefore provided, Landlord shall give
Tenant written notice ("Landlord's Notice") of such default, and Tenant shall
have a period of thirty (30) days after the Landlord's Notice to cure such
default.
(b) If Tenant exercises the Renewal Option in accordance with the terms set
forth above, the Renewal Term shall be upon the same terms, covenants and
conditions as those contained in this Lease, except that (i) the Base Rent shall
be per Lease Year, payable in monthly installments of ______________ each; (ii)
the provisions of subparagraph (a) above relative to Tenant's right to renew the
term of this Lease shall not be applicable during the Renewal Term; and (iv) the
Expiration Date shall, for the purposes of the Lease, be defined as the Renewal
Expiration Date.
ARTICLE III
USE; COMPLIANCE WITH LAWS
3.1 Permitted Use. Subject to all the terms and conditions of this Lease,
Tenant shall use and occupy the Premises only as a facility for the design and
custom manufacture of thermoformed plastic parts with related office and storage
space and for no other use without Landlord's prior written consent, which
consent shall not be unreasonably withheld, conditioned or delayed. Tenant shall
not in any manner deface or injure the Premises or any part thereof, or overload
the floors of the Premises, unless Tenant makes the repairs as required under
the terms of this Lease or alterations to accommodate such overloading. Tenant
shall not do anything or permit anything to be done upon the Premises which
would constitute a public or private nuisance or waste, or would tend
unreasonably to disturb occupants of neighboring properties, taking into account
the applicable zoning and industrial character of the Premises, or would cause
structural injury to the improvements or cause the value or usefulness of the
Premises or any part thereof to diminish in any material respect. Tenant shall
install and maintain at all times in the Premises fixtures, furnishings,
fittings and equipment which are substantially the same quality as those items
in place at the Premises as of the Commencement Date. Tenant shall conduct its
business in a reputable manner.
Tenant shall not use the Premises for the retail sale of property or
conduct or permit to be conducted any auction or auction sale at the Premises.
3.2 Compliance with Laws. Tenant shall not use or occupy the Premises or
permit the Premises to be used or occupied by its agents or employees contrary
to any statute, rule, order, ordinance, requirement or regulation applicable
thereto (including, but not limited to, "environmental laws" described in
Article XIII below) or in a manner which would violate any certificate of
occupancy affecting the same, or for illegal or immoral purposes. Tenant shall
observe and comply in all material respects with all conditions and requirements
necessary to preserve and extend any and all rights, licenses, permits
(including but not limited to zoning variances, special exemptions and
nonconforming uses approved by Tenant), privileges, franchises and concessions
which are now applicable to the Premises, or which have been granted to or
contracted for by Tenant or Landlord in connection with any existing or
presently contemplated use of the Premises.
3.3 Permits and Approvals. Tenant shall, at its sole cost and expense,
procure any and all necessary permits, certificates, licenses or other
authorizations required for its use of the Premises as set forth in Section 3.1
above. If the owner of the Premises is required by law to join in any such
application, Landlord shall reasonably cooperate with Tenant in connection with
such application, but at Tenant's cost.
3.4 Rules and Regulations. Tenant shall comply with, and shall cause
Tenant's employees, contractors and all other persons brought to the facility to
comply with, Landlord's Rules and Regulations, attached hereto as Exhibit B.
Such Rules and Regulations may be reasonably amended by Landlord from time to
time.
3.5 Parking Areas. Landlord and Tenant agree that Landlord will not be
responsible for any loss, theft or damage to vehicles, or the contents thereof,
parked or left in the parking areas of the Premises and Tenant shall install at
least one sign in the parking areas so advising its employees, visitors or
invitees who may use such parking areas. Except as otherwise provided in this
Section 3.5, parking areas shall be used for parking by vehicles no larger than
full-size passenger automobiles or pick-up trucks, herein called "Permitted Size
Vehicles." Vehicles other than Permitted Size Vehicles shall be parked and
loaded or unloaded as directed by Landlord in the Rules and Regulations. Tenant
shall not permit or allow any vehicles that belong to or are controlled by
Tenant or Tenant's employees, suppliers, shippers, customers, contractors or
invitees to be loaded, unloaded or parked in areas other than those designated
by Landlord for such activities. Tenant agrees not to use or permit its
employees, visitors or invitees to use the parking areas for overnight storage
of vehicles, except for trucks on the Premises in the process of loading or
unloading, and except for semi-tractors and trailers parked in the areas shown
on the Site Plan as "Tenant's Designated Truck Parking". Tenant covenants and
agrees that it shall not permit any of its employees, agents, contractors,
vendors or shippers to park trucks, automobiles, trailers or other vehicles on
any of the public streets in the general vicinity of the Premises or the
industrial or business park in which the Premises are located. If Tenant permits
or allows any of the prohibited activities described above for a period of five
(5) business days after written notice from Landlord, then Landlord shall have
the right, without further notice, in addition to such other rights and remedies
that it may have, to remove or tow away the vehicle involved at Landlord's risk
and expense. All responsibility for damage and theft to vehicles and their
contents is assumed by the parties owning the same, including, respectively,
Tenant or Tenant's partners, trustees, officers, directors, shareholders,
members, invitees, or any of Tenant's assignees, subtenants or assignees' or
subtenants' agents, employees, contractors, customers, suppliers, servants,
guests, or independent contractors (collectively, "Tenant Parties"). Tenant
shall repair or cause to be repaired, at Tenant's sole cost and expense, any and
all damage, ordinary wear and tear excepted, to any portion of the Property
caused by the use by Tenant Parties of the driveway or parking areas within the
Property. Landlord shall not be liable to Tenant by reason of any moratorium,
initiative, referendum, statute, regulation or other governmental action which
could in any manner prevent or limit the parking rights of Tenant hereunder. Any
governmental charges or surcharges or other monetary obligations imposed
relative to Parking rights with respect to the Building shall be considered
assessments and shall be Payable by Tenant as set forth in Paragraph 4.1; as of
the Commencement Date, Landlord represents there are no such charges or
surcharges imposed on the Premises.
3.6 Access and Parking. Landlord represents to Tenant that the Premises
enjoy reasonable access to one or more public thoroughfares or by way of a
dedicated easement without necessity for additional consents from any third
parties, and by way of the points of ingress and egress to the parking areas
shown on the Site Plan. Landlord shall make available to Tenant, for Tenant's
exclusive use those parking spaces shown on the Site Plan as "Tenant's Exclusive
Parking" and as "Tenant's Designated Truck Parking." Landlord shall not alter or
diminish the parking or drive areas shown on the Site Plan without Tenant's
prior written consent
ARTICLE IV
ADDITIONAL RENT; TAXES; UTILITIES
4.1 Tenant to Pay Taxes and Assessments. As further consideration for this
Lease, Tenant shall pay all real estate taxes, charges and assessments of every
kind and nature which shall be due and payable, and for which any non-payment
would result in a delinquency, during the term of this Lease, including all
installments of special assessments now or hereafter levied and interest
thereon. Provided, however, that regardless of the payment dates for real estate
taxes due and payable in [year of Commencement Date] and in [Year of Expiration
Date] (and, in the event that Tenant exercises the Renewal Option, in [Year of
Renewal Expiration Date]), and any installments of special assessments and
interest thereon payable therewith, such taxes and assessments (including any
installments referenced below) shall be prorated between Landlord and Tenant on
a daily basis to reflect the term of this Lease and any extension or renewal
thereof, and any holdover tenancy. The parties agree that any special
assessments assessed against the Premises after the Commencement Date shall be
paid in installments spread over the longest period of time permitted under law
and Tenant shall be obligated only to pay those installments due and payable
during the term of this Lease. Notwithstanding anything to the contrary, in the
event that the Premises are assessed for an improvement requested by Tenant or
required because of Tenant's use of the Property, Tenant shall be solely liable
for such assessment and shall pay such assessment in full prior to the
Expiration Date (or, if Tenant has exercised the Renewal Option, the Renewal
Expiration Date). Landlord represents to Tenant that, as of the Commencement
Date, Landlord is not delinquent in the payment of any taxes or assessments on
or affecting the Premises for the current or any prior tax year. In no event
shall Tenant be responsible for any taxes in the nature of income, inheritance,
capital gains, franchise or rental taxes of Landlord.
4.2 Personal Property Taxes. Tenant shall pay or cause to be paid all
personal property taxes under any laws hereafter in force, levied against
personal property of any kind or nature owned by, leased to or otherwise being
used by Tenant in the operation of its business from the Premises and which is
located on the Premises.
4.3 Time of Payment of Taxes and Receipts. Subject to the provisions of
Section 4.1 Tenant shall pay all said taxes, charges and assessments in each and
every instance as the same become due and payable and before any fine, penalty,
interest or costs may be added thereto for non-payment, excepting only interest
on deferred installments of special assessments. Tenant shall deliver to
Landlord receipts (or duplicate receipts) showing the full and prompt payment of
all such taxes, charges and assessments within ten (10) days after written
demand therefore from Landlord. Landlord shall provide all tax bills for the
Premises and any personal property located thereon with five (5) days after
Landlord's receipt of such bills from the applicable taxing authority.
4.4 Tenant to Pay for Utilities. Tenant shall fully and promptly pay when
due all utility charges for all services furnished to or upon the Premises
during the full term of this Lease and any holdover tenancy, including, without
limitation, water, gas, electricity, sewage disposal, and telephone tolls. Under
no circumstances, except for causes resulting from the negligence or willful
misconduct of Landlord, shall an interruption of any or all of said utilities
constitute a constructive eviction or be deemed a default by Landlord under this
Lease. Water, gas, electricity, sewer disposal, adequate storm water drainage
and telephone utilities are currently available at the Premises.
4.5 Definition of Rent. All payments to be made by Tenant under the Lease,
however denominated, shall be considered, and are payable, as rent.
ARTICLE V
MAINTENANCE, INDEMNITY, INSURANCE
5.1 Maintenance. As Tenant has complete control over the Premises and the
parties have agreed that the Lease shall be construed as a "net lease" to
Landlord, Landlord shall have no obligation whatsoever to maintain the Premises
except for those certain Major Building Systems Obligations set out in Section
5.1(d).
Except with respect to the Landlord's Major Building Systems Obligations
set forth in Section 5.1(d), Tenant shall, at all times during the lease term,
and any extensions or renewals thereof, and any holdover tenancy, be responsible
for replacement, maintenance and repair of all of the components of the Premises
and all fixtures and equipment thereon or therein, including, without
limitation, roofs, ▇▇▇▇▇, gutters, exterior walls, foundation, the HVAC system,
all plate glass, all interior and exterior windows, boilers, elevators and other
equipment and fixtures, and each and every walkway, alley, access road, parking
lot and passageway appurtenant or contiguous to the Premises. Tenant shall keep
such components in good repair and safe and working condition and in substantial
compliance with all laws, ordinances and regulations then in force, making
whatever replacement is necessary under the circumstances. Tenant's obligations
under this Section 5.1 includes, but is not limited to all routine maintenance
for all portions of the Premises, including the painting of all surfaces,
clearance of snow, periodic coating and restriping of parking areas,
landscaping, etc. Notwithstanding anything to the contrary, Tenant shall be
responsible for the replacement, repair, construction, addition or installation
(and, if required by Landlord, removal) of all leasehold Alterations.
The term "Major Building Systems" means the roof, exterior or load-bearing
walls, the parking lot, the foundation, electrical mains, and water, storm,
sanitary sewer and drainage systems of the Premises. The term "Significant
Repair" means any repair to a Major Building System for the purpose of
significantly increasing the useful life of such Major Building system.
Notwithstanding Section 5.1(b), Landlord shall be responsible for the
replacement or Significant Repair of all Major Building Systems (collectively,
Landlord's "Major Building Systems Obligations"), but only to the extent that
the need for such replacement or Significant Repair has not been made necessary
by (i) the failure of Tenant to properly maintain the Major Building System,
(ii) an alteration to the Premises by Tenant, or (iii) the results of any
willful or grossly negligent act or omission of Tenant or Tenant's employees,
agents, contractors, suppliers or invitees.
Tenant shall be responsible for the replacement of all Major Building
Systems to the extent that the need for such replacement or Significant Repair
of has been made necessary by (i) the failure of Tenant to properly maintain the
Major Building System, (ii) an alteration to the Premises by Tenant, or (iii)
the result of any willful or grossly negligent act or omission of Tenant or
Tenant's employees, agents, contractors, suppliers or invitees.
5.2 Waiver of Liability. Landlord shall not be liable to Tenant, or
Tenant's agents, employees, customers, or invitees, for injury, death or
property damage occurring in, on or about the Premises directly resulting from
Tenant's activities from the Premises or from the activities of any other
parties, other than the Landlord Parties. Except for Landlord's gross negligence
or willful misconduct, Tenant shall indemnify, protect, defend and hold harmless
the Premises, Landlord and Landlord's partners, trustees, officers, directors,
shareholders, members, employees, heirs and assigns (collectively, the "Landlord
Parties") from and against any and all claims, loss of rents and/or damages,
costs, liens, judgments, penalties, loss of permits, attorneys' and consultants'
fees, expenses and/or liabilities arising out of, directly or indirectly, in
whole or in part involving, or in connection with, the occupancy of the Premises
by Tenant, the conduct of Tenant's business, any act, omission or neglect of
Tenant, or the Tenant Parties (as hereinafter defined). Landlord shall
indemnify, protect, defend and hold harmless Tenant and Tenant's officers,
directors, shareholders, members, employees, heirs and assigns (collectively,
the "Tenant Parties") from and against any and all claims, loss, damages, costs,
liens, judgments, penalties, loss of permits, attorneys' and consultants' fees,
expenses and/or liabilities arising out of or in connection with any act,
omission or neglect of Landlord or the Landlord Parties in connection with this
Lease or the Premises. The foregoing shall include, but not be limited to, the
defense or pursuit of any claim or any action or proceeding involved therein,
and whether or not (in the case of claims made against Landlord or any Landlord
Party or against Tenant or any Tenant Party) litigated and/or reduced to
judgment. In case any action or proceeding be brought against either party by
reason of any of the foregoing matters, the party responsible for indemnifying
the other ("Indemnifying Party") upon notice from the other party shall defend
the same at the Indemnifying Party's expense by counsel reasonably satisfactory
to the other party, and the other party shall cooperate with the Indemnifying
Party in such defense. A party indemnified hereunder need not have first paid
any such claim in order to be so indemnified. The indemnity obligations under
this Paragraph shall survive the expiration or earlier termination of the Lease.
Except for Landlord's indemnity hereunder, Landlord shall not be liable for, and
Tenant hereby waives and releases Landlord from, injury or damage to the person
or goods, wares, merchandise or other property of Tenant, Tenant's employees,
contractors, invitees, customers, or any other person in or about the Premises,
whether such damage or injury is caused by or results from fire, steam,
electricity, gas, water or rain, or from the breakage, leakage, obstruction or
other defect of pipes, fire sprinklers, wires, appliances, plumbing, air
conditioning or lighting fixtures, or from any other cause, whether said injury
or damage results from conditions arising upon the Premises or from other
sources or places, and regardless of whether the cause of such damage or injury
or the means of repairing the same is accessible or not.
5.3 General Liability and Related Insurance. During the entire term of this
Lease and any extensions or renewals thereof, and any holdover tenancy Tenant
shall obtain and keep in full force and effect, at its sole cost and expense, a
policy of comprehensive public liability insurance with respect to the Premises
and the business of Tenant thereon, written on an "occurrence", and not a
"claims made" basis, by a responsible casualty or indemnity company authorized
to do business in the Property Jurisdiction, under which policy Landlord and
Lenders, if any, shall be named as additional insureds, and with single coverage
limits for each occurrence of injury or property damage in amounts reasonably
acceptable to Landlord. Prior to the Commencement Date, Tenant shall cause such
insurance policy to furnish Landlord with said policy or with a certificate that
said insurance is in effect, states that Landlord will be notified in writing
thirty (30) days prior to any cancellation, material change or renewal of said
insurance. If the Premises has a boiler or steam vessel, Tenant shall also place
and carry boiler insurance with such a casualty or indemnity company in an
amount of coverage reasonably acceptable to Landlord, and Tenant shall comply
fully with all applicable laws, ordinances, and regulations with reference to
the operation and inspection of such boiler and steam vessel. Tenant shall also
maintain such other insurance coverages, naming Landlord and Lenders, if any, as
additional insureds with coverage limits satisfactory to Landlord, as Landlord
may reasonably conclude are prudent or advisable based on the use to which
Tenant is putting the Premises.
5.4 Casualty Insurance. Tenant shall keep all buildings, structures and
other improvements constructed, erected or made upon the Premises, insured on an
"occurrence" basis and not a "claims made" basis, under an "all risk" form of
fire insurance policy, with full extended coverage endorsements added, with
coverage equal to the then full replacement cost of the buildings, with
deductibles reasonably acceptable to Landlord and Tenant improvements and
fixtures, without deduction for physical depreciation. In case of loss or damage
from any of the hazards covered by said policy, Tenant shall be entitled to
receive the proceeds, to be used in repairing, restoring or rebuilding the
building, structures and other improvements of the Premises to at least as good
condition as they were in before such loss or damage, pursuant to Article VI;
and the balance of said proceeds, if any, shall be the property of Tenant.
5.5 Worker's Compensation Insurance. Tenant shall maintain at all times any
worker's compensation insurance coverage as may be required by law and, upon
request, shall present a certificate of such insurance to Landlord.
5.6 INTENTIONALLY OMITTED.
5.7 Form of Policies. The minimum limits of policies of insurance required
of Tenant under this Lease shall in no event limit the liability of Tenant under
this Lease. Such insurance shall (i) name Landlord and Lenders, if any, as an
additional insured; (ii) specifically cover the liability assumed by Tenant
under this Lease, including, but not limited to, Tenant's obligations to
indemnify Landlord under this Lease; (iii) be issued by an insurance company
having a rating of not less than A-IX[?] in Best's Insurance Guide or which is
otherwise reasonably acceptable to Landlord and licensed to do business in the
Property Jurisdiction; (iv) be primary insurance as to all claims thereunder and
provide that any insurance carried by Landlord is excess and is non-contributing
with any insurance requirement of Tenant; and (v) contain a cross-liability
endorsement or severability of interest clause reasonably acceptable to
Landlord. Tenant shall use its best efforts to cause such insurance policies to
provide that the insurance carrier will give Landlord and any additional insured
thirty (30) days written notice before any such policy is canceled, expires or
the coverage changed. Tenant shall deliver said policy or policies or
certificates thereof to Landlord on or before the Lease Commencement Date and at
least thirty (30) days before the expiration dates thereof. In the event Tenant
shall fail to procure such insurance, or to deliver such policies or
certificate, Landlord may, after fifteen (15) days' prior written notice to
Tenant, at its option, procure such policies for the account of Tenant, and the
cost thereof shall be paid to Landlord as additional rent thirty (30) days after
delivery to Tenant of bills therefor.
5.8 Subrogation of Claims. Landlord and Tenant hereby waive any and all
claims and causes of action against each other based on the destruction of or
damage to the Premises or the contents thereof as a result of any cause that is
to be insured pursuant to this Article V, and agree that their respective
insurers shall be bound by this waiver, even if such loss or damage was caused
by the fault or negligence of the other party or anyone for whom the other party
may be responsible.
5.9 Damage Not to Terminate Lease. Should any building, structure or other
improvement upon the Premises be damaged or destroyed by any cause, such damage
or destruction shall not effect a cancellation of this Lease, effect any
reduction or abatement of rent, or release Tenant from liability for the full
performance of all of the covenants of this Lease, past, present or future,
except as expressly provided in Section 5.10, below.
5.10 Rebuilding after Damage.
(a) In case any building, structure, or other improvement on the Premises
shall be damaged or destroyed by fire or other casualty covered by the aforesaid
casualty insurance policy, unless Tenant has terminated the Lease as hereinafter
provided in Section 5.10(c) Landlord shall, as soon as possible after the date
of such injury or destruction, commence to repair, restore or rebuild such
building, structure or other improvement, and shall complete the same as rapidly
as possible, but in any event not later than one (1) year after such damage or
destruction. In connection with such repair, Landlord shall not be required to
expend any sums in excess of insurance proceeds actually received by Landlord.
Such repair, restoration and rebuilding shall be accomplished pursuant to the
provisions of Article VI and the requirements of Landlord's mortgagee, if any.
(b) In case any building, structure, or other improvement on the Premises
shall be injured or destroyed by a casualty which is not covered by the
aforesaid casualty insurance policy, or if the Premises is totally destroyed by
a casualty, regardless of insurance coverage, Landlord shall have the right, but
no obligation, to repair, restore or rebuild such building, structure or other
improvement. If Landlord elects not to repair, restore or rebuild the building,
structure or other improvement, Landlord shall provide written notice thereof to
Tenant within ninety (90) days after the casualty. Tenant shall then have the
right, but not the obligation to repair, restore or rebuild. Tenant shall notify
Landlord whether or not Tenant elects to rebuild, restore or repair within sixty
(60) days after receipt of Landlord's notice. In the event Tenant elects to
repair, restore or rebuild, it shall complete the same as rapidly as possible,
but in any event no later than one (1) year after such injury or destruction.
Such repair, restoration or rebuilding shall be accomplished pursuant to the
provisions of Article VI. In the event neither party shall elect not to repair,
restore or rebuild under this Section 5.10(b), this Lease shall terminate as of
the date of the casualty, and all rents and other amounts and obligations due
hereunder shall be apportioned as of the date of the casualty and all proceeds
from the casualty insurance policy for the Premises shall belong to Landlord.
Notwithstanding the effective date of such termination, upon the written
request of Landlord, Tenant shall have the continuing obligation to raze any
partially damaged or destroyed building or improvement upon the Premises and to
remove all debris and building materials, to the extent such razing or removal
the same would be covered under insurance Tenant is required to carry under the
Lease. In the event that Landlord so requests, Tenant shall level the ground
upon completion of said razing and removal. Said razing, removal and leveling
shall be accomplished at no cost or expense to Landlord.
(c) In the event the Premises are damaged or destroyed by fire or other
casualty to the extent that Tenant determines, in the exercise of its reasonable
discretion, that (i) the Premises are not suitable, either on a temporary basis
exceeding thirty (30) days or on a permanent basis, for the conduct of its
business from the Premises to permit full and efficient operation in the manner
desired by Tenant, or (ii) the Premises cannot be fully restored to Tenant's
satisfaction within one (1) year after the date of such casualty, then,
irrespective of whether such damage or destruction is covered by insurance,
Tenant may terminate this Lease upon written notice ("Termination Notice") to
Landlord given no more than forty-five (45) days after the date of such
casualty. Upon such Termination Notice, the Lease shall be deemed to have
terminated as of the date of the casualty, and Tenant shall have no further
obligations under the Lease from and after such date.
(d) In the event Tenant undertakes to repair or restore the Premises as
permitted in this Lease, Landlord shall make available to Tenant all proceeds
from any insurance covering the damage to or destruction of the Premises, and
such proceeds shall be used by Tenant for such repair or restoration.
(e) During any period where the Premises are being repaired or restored as
provided in this Section 5.10, Basic Rent and any other payments by Tenant under
this Lease shall ▇▇▇▇▇ in the same proportion that the square footage in the
building on the Premises which is unusable for the conduct of Tenant's business
as determined by Tenant, in the exercise of its reasonable discretion, (the
"Unusable Square Footage") bears to the total square footage of the building on
the Premises.
5.11 Termination for Failure to Rebuild. If either Landlord or Tenant shall
not commence to repair, restore or rebuild a damaged or destroyed building,
structure, or other improvement as soon as possible, and complete the same as
provided in Section 5.10(a) or Section 5.10(b), respectively, then the party not
responsible for such repair may terminate this Lease as provided herein and, if
this Lease be terminated, any and all proceeds of the aforesaid fire insurance
policy and the policy shall thereupon belong absolutely to Landlord except for
any proceeds from insurance covering Tenant's equipment, machinery, inventory or
other personal property and any fixtures or leasehold improvements installed or
constructed on the Premises at Tenant's expense. In addition, Tenant shall pay
over to Landlord on demand any cost of replacing the Premises in excess of
insurance proceeds actually received, including any deductible amount under any
applicable insurance policy.
ARTICLE VI
ALTERATIONS; CONSTRUCTION STANDARDS
6.1 Alterations. Tenant may, at its sole cost and expense, expand, alter,
remodel or enlarge (collectively, "Alterations") any now or hereafter existing
improvement without Landlord's consent, provided that if the cost of such
Alterations is estimated to exceed the "Alteration Threshold" (as defined in
Section 6.2, below) it first secures the written consent of Landlord to the
plans and specifications therefor and further provided that any such work shall
be in accordance with the provisions of Paragraph 6.2. Any leasehold
improvements made by Tenant, and any fixtures (except trade fixtures) installed
on the Premises by Tenant, shall be the property of Landlord from and after the
time of their construction or installation; provided, however, that Landlord may
require that any or all leasehold improvements be removed by the expiration or
earlier termination of this Lease, notwithstanding that the installation of such
leasehold improvements may have been consented to by Landlord, unless Landlord
has indicated to Tenant in such consent, that such removal will not be required.
Every alteration shall comply with all building codes and other applicable
regulations. In no event shall Landlord's approval of any alteration serve as a
representation or warranty by Landlord regarding the fitness or adequacy of such
leasehold improvement, including, without limitation, any warranty that such
improvement complies with any code or regulation.
6.2 Construction Standards. Any such work, and any rebuilding and
restoration under Article V or IX with a cost in excess of $25,000 for any
single improvement, or $100,000 in the aggregate in any single calendar year,
(collectively, the "Alteration Threshold"), shall be constructed and installed
according to plans and specifications prepared by Tenant's architect or agent,
and approved in writing by Landlord. In all of the foregoing construction and
installation described in the preceding sentence undertaken by Tenant, whether
or not approved by Landlord, Tenant shall be bound by and do all of the
following:
Complete said construction and installation as rapidly as practicable and
pay for all labor performed and materials furnished, when due and payable,
unless Tenant is disputing such payment;
(b) Keep the Premises free and clear of all liens for labor performed and
materials furnished, and defend, at its sole cost and expense, each and every
lien asserted or filed against the Premises or any part thereof, and pay each
and every judgment made or given against said Premises, or any part thereof, on
account of any such lien, or if Tenant is contesting such lien or judgment, make
any other provisions reasonably acceptable to Landlord to protect it from such
lien or judgment;
(c) Indemnify and save Landlord harmless from and against any and every claim,
demand, action, cause of action, or charge, including reasonable attorneys' fees
incurred by Landlord, arising out of or connected with or alleged to arise out
of or to be connected with any act or omission of Tenant, or any agent,
employee, contractor or sub-contractor in or about the Premises, or connected
with the assertion or filing of any lien against said Premises;
(d) Procure, or cause its general contractor to procure, before entering onto
the Premises, and maintain in full force until all work is fully completed, a
policy of builder's risk insurance covering the completed value of any work to
be performed, and a policy of indemnity insurance written by a casualty or
indemnity company authorized to do business in the Property Jurisdiction,
indemnifying Landlord against all liability for injury arising out of, or in any
way connected with, or alleged to arise out of or in any way be connected with
any said work, with not less than $1,000,000 single coverage limits for each
occurrence of injury or property damage. In connection with all said work on the
Premises, Tenant or its contractors shall procure and maintain in force such
workers' compensation or other insurance as may be required by the laws of the
Property Jurisdiction, fully protecting Landlord. Landlord shall be named as an
additional insured under said policies, and said policies, or certificates
evidencing that such insurance is in effect, shall be delivered by Tenant to
Landlord prior to any contractor's commencement of work on the Premises. Tenant
shall use its best efforts to provide policies or certificates that state that
the Landlord will be notified in writing thirty (30) days prior to any
cancellation, material change or non-renewal of any such insurance;
(e) At Landlord's election, deposit all insurance or condemnation proceeds with
a title company of Landlord's choice to be disbursed pursuant to a disbursement
agreement of the kind typically used in construction loans for similar projects.
6.3 Landlord's Consent. Landlord shall not unreasonably withhold, condition
or delay its consent to a proposed alteration, or the plans and specifications
therefor, if no substantial change in use of the Premises is contemplated and
the value of the Premises is not likely to be diminished thereby.
6.4 Landlord's Oversight of Improvements. Landlord shall have the right to
inspect any leasehold improvements as they are being constructed or once
completed, so long as such inspections are conducted at reasonable times and in
a manner that does not interfere with any work being performed by Tenant or its
Contractors. In no event shall Landlord's inspection or oversight of a leasehold
improvement serve as a representation or warranty by Landlord regarding the
fitness or adequacy of such leasehold improvement, including, without
limitation, any warranty that such improvement complies with any code or
regulation.
ARTICLE VII
ASSIGNMENT AND SUBLETTING; ENCUMBRANCES
7.1 No Assignment of Tenant's Interest. Tenant shall not, without the prior
written consent of Landlord, which consent shall not be unreasonably withheld,
conditioned or delayed assign, mortgage, pledge, hypothecate, encumber, or
permit any lien to attach to, or otherwise transfer, this Lease or any interest
hereunder, permit any assignment or other such foregoing transfer of this Lease
or any interest hereunder, sublet the Premises or any part thereof, or permit
the use of the Premises by any persons other than Tenant and its agents,
contractors, subcontractors and employees (all of the foregoing are hereinafter
sometimes referred to collectively as "Transfers" and any person to whom any
Transfer is made or sought to be made is hereinafter sometimes referred to as a
"Transferee"). If Tenant shall desire Landlord's consent to any Transfer, Tenant
shall notify Landlord in writing, which notice (the "Transfer Notice") shall
include (i) the proposed effective date of the Transfer, which shall not be less
than twenty (20) days nor more than ninety (90) days after the date of delivery
of the Transfer Notice, (ii) a description of the portion of the Premises to be
transferred (the "Subject Space"), (iii) all of the material terms of the
proposed Transfer and the consideration therefor, in connection with such
Transfer, the name and address of the proposed Transferee, and a copy of all
existing and/or proposed documentation pertaining to the proposed Transfer,
including all existing operative documents to be executed to evidence such
Transfer or the agreements incidental or related to such Transfer, and (iv)
where Tenant will be relieved of all obligations under the Lease following such
transfer, current financial statements of the proposed Transferee certified by
an officer, partner or owner thereof, and any other information reasonably
required by Landlord, which will enable Landlord to determine the financial
responsibility, character, and reputation of the proposed Transferee, the nature
of such Transferee's business and proposed use of the Subject Space, and such
other information as Landlord may reasonably require. Landlord shall respond to
any properly delivered Transfer Notice within fifteen (15) business days,
stating with reasonable specificity Landlord's objections to such Transfer where
Landlord withholds its consent to such Transfer. Any Transfer made without
Landlord's prior written consent shall, at Landlord's option, be null, void and
of no effect, and shall, at Landlord's option, constitute a default by Tenant
under this Lease. Whether or not Landlord shall grant consent, Tenant shall pay
Landlord's reasonable review and processing fees, as well as any reasonable
legal fees incurred by Landlord not to exceed $1,000, within thirty (30) days
after written request by Landlord, for a Transfer in the ordinary course of
business.
7.2 Effect of Transfer. If Landlord consents to a Transfer, (i) the terms
and conditions of this Lease shall in no way be deemed to have been waived or
modified, (ii) such consent shall not be deemed consent to any further Transfer
by either Tenant or a Transferee, (iii) Tenant shall deliver to Landlord,
promptly after execution, an original executed copy of all documentation
pertaining to the Transfer in form reasonably acceptable to Landlord, (iv) no
Transfer relating to this Lease or agreement entered into with respect thereto,
shall relieve Tenant from liability under this Lease, unless Landlord has
expressly consented to a Transfer where one of the terms of which is Tenant's
release from the obligations under this Lease.
7.3 INTENTIONALLY OMITTED.
7.4 Non-Transfers. Notwithstanding anything to the contrary contained in
this Paragraph, an assignment or subletting of all or a portion of the Premises
to an affiliate of Tenant (an entity which is controlled by, controls, or is
under common control with, Tenant, with "control" meaning beneficial ownership
of 50% of all voting equity interests), shall not be deemed a Transfer under
this Paragraph, provided that Tenant notifies Landlord of any such assignment or
sublease and promptly supplies Landlord with any documents which Landlord may
reasonably request. In no event will Tenant be required to obtain Landlord's
prior consent to any Transfer to any successor to Tenant by liquidation, merger,
consolidation or other transaction where such successor has a net worth equal to
the net worth of Tenant immediately prior to such transaction.
7.5 Landlord May Assign. Except as expressly provided in this Lease,
Landlord's right to assign this Lease or sell or convey the Premises, subject to
this Lease, are and shall remain unqualified. Upon any said assignment, sale or
conveyance, so long as any transferee or assignee expressly undertakes the
performance of all of Landlord's obligations, under this Lease, including,
without limitation, any uncured defaults of Landlord, Landlord shall thereupon
be entirely freed of all obligations of the Landlord hereunder accruing
thereafter and shall not be subject to any liability resulting from any act or
omission or event occurring after said assignment, sale or conveyance.
7.6 Tenant to Place No Mortgage. Except for any collateral assignment of
Tenant's interest under this Lease in connection with any of Tenant's financing,
Tenant shall not at any time during the term of this Lease place, suffer or
allow any mortgage, deed of trust or similar security instrument upon its
leasehold interest created hereby, even though Landlord's title is superior to
said mortgage, deed of trust or instrument.
7.7 Landlord May Place Mortgage. Landlord shall have the unrestricted night
at any time during the fall term of this Lease to place any mortgage, deed of
trust or similar security instrument upon the Landlord's interest in the
Premises.
7.8 Other Liens Prohibited. Tenant shall not cause, suffer or acquiesce in
the attachment of any other liens or encumbrances resulting from any act or
failure to act on the part of any Tenant Parties with regard to any of Tenant's
obligations under this Lease, including without limitation, any mechanic's or
materialmen's liens, judgment liens, tax liens or lien for the cost of
environmental remediation, to the Premises or the Landlord's or Tenant's
interest therein. Except for the liens hereinbefore set forth which are Tenant's
responsibility, Landlord shall not cause, suffer or acquiesce in the attachment
of any mechanic's or materialmen's lien, tax lien or for the cost of
environmental remediation, to the Premises.
ARTICLE VIII
LANDLORD'S CURATIVE RIGHTS
8.1 Landlord May Pay Taxes, Liens, etc. In the event Tenant shall fail or
neglect at the times and as herein provided to pay any tax, charge or assessment
against the Premises, or to pay any lien or judgment against or affecting the
Premises created by Tenant's acts or omissions, or to provide and pay for any
insurance, or to make any other payment which it is the obligation of Tenant to
pay under the terms of this Lease, when due and payable, then in addition to all
other remedies provided by this Lease or as now or hereafter provided by law,
Landlord may, at its option, upon fifteen (15) days prior written notice to
Tenant, pay any such judgment, tax, charge or assessment, or procure such
insurance or pay the premiums therefor, and pay any other amount herein required
to be paid by Tenant. The amount or amounts so paid and interest thereon as
hereinafter provided shall thereupon be due and payable by Tenant to Landlord,
as additional rent hereunder, within thirty (30) days after Landlord has
invoiced Tenant for such amounts.
8.2 Tenant May Contest Taxes, etc. Tenant, however, shall not be required
to pay, remove or discharge any tax, assessments, tax lien, or any materialmen's
or mechanics' lien or judgment against the Premises so long as Tenant shall in
good faith contest the same or the validity thereof by appropriate legal
proceedings, and so long as Landlord's title and rights are not in any manner
impaired or jeopardized thereby, provided Tenant deposits with Landlord
sufficient funds or other security acceptable to Landlord to protect Landlord
and the Premises. Pending any such legal proceedings, Landlord shall not pay,
remove or discharge the tax, assessment, tax lien, materialmen's or mechanics'
lien or judgment thereby contested unless its title or rights are be aired or
jeopardized by such delay or by such contest, in which event Landlord may use
any such deposits to pay and discharge the same.
8.3 Tenant to Furnish Receipts. Upon demand by Landlord, Tenant shall
promptly furnish to Landlord receipts or other satisfactory evidence showing
that Tenant has fully and promptly paid and discharged all charges, premiums, or
any other payments required to be made by Tenant under the terms of this Lease.
8.4 Landlord's Advances to Bear Interest. Tenant will pay to Landlord the
greater of interest at the rate of twelve percent (12%) per annum or the late
fees in 2.4(a), or the maximum rate allowed by law, whichever is lower, on every
payment of every kind which Tenant is obligated to pay to Landlord under the
terms of this Lease (other than rent) from the date when such payment shall
become due and payable until the same is paid.
8.5 Landlord's Right to Enter Premises. Landlord, and its authorized agents
or attorney, shall have the right, but not be obligated to enter the Premises:
(a) at any time in an emergency, and (b) upon 48 hours prior notice to Tenant at
other reasonable times during normal business hours to inspect, and to make such
repairs, improvements and/or alterations in and to the Premises as Landlord may
reasonably deem necessary under the circumstances, and there shall be no
abatement of rents or any liability on the part of Landlord for any
inconvenience, annoyance, or injury to business resulting therefrom, provided
that Landlord shall use its best efforts to minimize interference with Tenant's
business and occupancy of the Premises.
ARTICLE IX
CONDEMNATION
9.1 Condemnation. In the event the Premises or any part thereof shall at
any time during the term of this Lease be condemned and taken by right of
eminent domain, the damages allowed therefor (whether or not the same be
specifically apportioned by the Court or the Commissioner, or by any other body
making or supervising such condemnation, and regardless of such apportionment,
if any) shall be the sole property of Landlord, except that Tenant shall be
entitled to any separate award for the loss of Tenant's leasehold and for
Tenant's relocation expenses as defined by applicable law.
9.2 Rent after Condemnation; Termination. If the whole of the Premises be
condemned and taken, rent hereunder shall cease from the time Tenant shall be
deprived of possession of the Premises, and this Lease shall thereupon terminate
and Landlord shall refund to Tenant any prepaid and unearned rent. If a part,
but not the whole, of the Premises be so taken or condemned, then this Lease and
all of its provisions shall continue in full force and effect as to the
remainder of the Premises not so taken until the expiration of the full term of
this Lease, except that the Base Rent to be paid by Tenant may be adjusted as
provided in Paragraph 9.3, if the provisions of said paragraph are applicable;
provided, nonetheless, that in the event of a partial condemnation and taking
which materially and substantially interferes with the operation of Tenant's
business, as reasonably determined by Tenant, Tenant shall have the right, by
notice given to Landlord not later than 60 days following the date Tenant shall
be deprived of possession of a portion of the Premises, to terminate this Lease,
and upon the giving of such notice, this Lease shall terminate as of the date
specified in the notice. Any rents and other amounts and obligations due
hereunder shall be apportioned as of said date.
9.3 Abatement after Material Taking. In the event of a partial condemnation
and taking which materially and substantially interferes with the operation of
Tenant's business, and Tenant does not terminate this Lease as herein provided,
Base Rent for the Premises shall (in the absence of agreement by the parties) be
equitably abated based on application to the appropriate District Court or at
Tenant's option, shall be abated in the same proportion that the Unusable Square
Footage following such taking bears to the total square footage of the building
on the Premises.
9.4 If the Lease is not terminated as provided in this Article IX, Landlord
shall restore the Premises, at Landlord's sole cost and expense, to an
economically-viable whole reasonably suitable for the conduct of Tenant's
business from the Premises.
ARTICLE X
DEFAULT; REMEDIES
10.1 Default. In the event Tenant shall violate, fail to perform or be in
breach of (a) any covenant to pay Base Rent, additional rent, or any other
amount due hereunder and for more than five (5) days after the same is due, or
(b) any other term, condition or covenant hereof and shall fail to cure the same
within thirty (30) days after being given notice by Landlord, or (c) any term,
condition or covenant of any of the Other Leases described in Section 14.12
below after the expiration of any applicable cure period permitted under the
applicable Other Lease abandons the Premises for a period of thirty (30)
consecutive days and does not make reasonable provisions for the security and
protection of the Premises from vandalism, then Landlord may, without further
notice to Tenant, but without a breach of the peace either (x) re-enter the
Premises and terminate Tenant's right to possession thereof, without terminating
this Lease or (y) re-enter the Premises and terminate both Tenant's right to
possession thereof and this Lease. To the extent permitted by law, such re-entry
may be effected without further notice to Tenant or judicial proceedings and
upon such re-entry Landlord shall have the right to remove all persons and
personal property from the Premises. No such re-entry shall be deemed a
termination of this Lease unless Landlord notifies Tenant that this Lease is
terminated; and any such termination shall be effective only as of the date set
forth in such notice. Landlord may, in its sole discretion, after written notice
to Tenant, store any personal property so removed at the sole cost and expense
of Tenant. Nothing in this Section 10.1 shall relieve Tenant's obligation to pay
any late fee or other charge required under the terms of this Lease.
10.2 Payment by Tenant Upon Re-entry. Upon such re-entry, whether or not
Landlord shall terminate this Lease, Tenant shall pay to Landlord upon demand
(a) all Base Rent, additional rent and any other amount due to Landlord at the
time of such re-entry and (b) all costs and expenses incurred by Landlord to
effect such re-entry, including, without limitation, reasonable attorneys' fees,
and reasonable costs to repair the Premises for reletting (hereinafter "Re-entry
Costs") and (c) a sum equal to the present value of the difference, if any,
between the total amount of Base Rent, additional rent and any other amounts due
or other liquidated damages and the fair rental value of the Premises for the
period between such re-entry and the Expiration Date (or, if Tenant has
exercised the Renewal Option, the Renewal Expiration Date), based upon a
discount rate of 3% per annum.
10.3 Reletting on Tenant's Behalf. Following any re-entry, Landlord shall
use its best efforts to relet the Premises or any part thereof for the account
of Tenant for such term or terms (whether longer or shorter than the unexpired
initial or option period term of this Lease), at such rent and upon such
conditions and covenants as Landlord, in its sole discretion, may reasonably
deem advisable. Upon each such reletting, all rent received by Landlord shall be
applied to the following obligations of Tenant to the extent not then satisfied:
first, to Re-entry Costs; second, to any costs and expenses incurred by Landlord
in reletting the Premises or part thereof, including, without limitation, the
costs of reasonable brokers' attributable to the period from the reletting to
the expiration of the term of the Lease and attorneys' fees; third, to the
payments of Base Rent, additional rent and liquidated damages unpaid and due to
Landlord at the time of such reletting; fourth, to any other unpaid amount then
due from Tenant to Landlord; and the balance, if any, shall be held by Landlord
and applied in payment of Base Rent, additional rent and liquidated damages as
the same shall become due hereunder. If the rent received upon such reletting
during any calendar month shall be less than the total of (i) Base Rent that
would have been paid by Tenant for that month plus (ii) any additional rent
payable therewith, Tenant shall pay the deficiency to Landlord, such deficiency
being calculated and paid monthly.
10.4 No Election of Remedy. No remedy provided to Landlord hereunder shall
be deemed an exclusive remedy and the election by Landlord of any such remedy
shall not bar Landlord from pursuing any other remedy, for damages or otherwise,
whether available to Landlord hereunder or existing at law or in equity.
10.5 Landlord May Terminate Lease on Tenant's Bankruptcy, etc. In the event
Tenant's interest under this Lease be assigned by operation of law, or in event
of the bankruptcy, insolvency, voluntary or involuntary liquidation or winding
up of the affairs of Tenant, or in event of any corporate reorganizations or
arrangements under the bankruptcy or insolvency laws of the United States of any
State involving the interest of Tenant hereunder, Landlord may, at its election,
by thirty (30) days' written notice to Tenant, the trustee in bankruptcy, the
receiver, or other legal representative in charge of the interest of Tenant
hereunder, terminate and cancel this Lease.
10.6 Landlord's Default and Tenants Remedies. In the event Landlord shall
default under any of its obligations under the terms of this Lease and such
default is not cured by Landlord within thirty (30) days after written notice
from Tenant, Tenant shall be entitled to exercise all remedies available to it
at law or in equity, including, without limitation, the remedies of self-help or
termination of the Lease and enforcement of Landlord's performance of its
obligations by specific performance.
ARTICLE XI
SUBORDINATION; ESTOPPEL
11.1 Subordination. This Lease is subject and subordinate to the lien of
any mortgage or ground lease which may now or hereafter encumber the Premises.
In confirmation of such subordination, Tenant shall, at Landlord's request from
time to time, promptly execute any certificate or other document requested by
the holder of the mortgage; provided the holder of such mortgage executes an
agreement whereby such holder and any party taking by or through the holder,
shall not disturb Tenant's quiet enjoyment of the Premises, so long as Tenant is
not in default under the Lease ("Non-Disturbance Agreement"). Tenant agrees that
in the event that any proceedings are brought for the foreclosure of any
mortgage, subject to Tenant receiving a Non-Disturbance Agreement, Tenant shall
immediately and automatically attorn to the purchaser at such foreclosure sale,
as the landlord under this Lease, and Tenant waives the provisions of any
statute or rule of law, now or hereafter in effect, which may give or purport to
give Tenant any right to terminate or otherwise adversely affect this Lease or
the obligations of Tenant hereunder in the event that any such foreclosure
proceeding is prosecuted or completed. Notwithstanding anything to the contrary
in this Section 11, so long as Tenant is not in default under this Lease, this
Lease shall remain in full force and effect and the holder of the Mortgage and
any purchaser at foreclosure sale thereof shall not disturb Tenant's rights
and/or possession hereunder.
11.2 Estoppel Certificates. Landlord and Tenant each agree at any time and
from time to time, upon not less than thirty (30) days prior written notice by
the other, to execute, acknowledge and deliver to the requesting party or a
party designated by such requesting party an estoppel statement in the form
reasonably requested by the requesting party, and including such other matters
relating to this Lease as may reasonably be requested. Any such statement
delivered pursuant thereto may be relied upon by the requesting party and, to
the extent identified in the request for the estoppel statement, any prospective
purchaser of the Premises, any mortgagee or prospective mortgagee of the
Premises or of Landlord's interest, or any prospective assignee of any such
mortgagee, any purchaser of Tenant, any equity interest in Tenant or Tenant's
assets or any lender of Tenant.
ARTICLE XII
NOTICES
All notices required or permitted hereunder shall be in writing and shall
be deemed given either when personally delivered to either Landlord or Tenant
at, or three (3) business days after mailed U.S. Mail first class, postage
prepaid, registered or certified mail to, the addresses specified in the caption
of this Lease. Either party may, by proper notice, change its address hereunder.
In the event Landlord or Tenant cannot be found at its said address, or at its
then current address hereunder, notice shall be deemed given when mailed in the
aforesaid manner to its last known address, or in the case of Tenant, when
personally delivered to an officer of Tenant or its manager at the Premises.
ARTICLE XIII
ENVIRONMENTAL PROVISIONS
13.1 Definitions. For the purposes of this Lease, the term "environmental
laws" means, collectively, all applicable laws, ordinances, and regulations
(including consent decrees and administrative orders) relating to public health
and safety and protection of the environment, including but not limited to the
Comprehensive Environmental Response, Compensation, and Liability Act
("CERCLA"), 42 U.S.C. ss.9601, et seq., or the Hazardous Materials
Transportation Act, 49 U.S.C. ss.1801, et seq., the Resource Conservation and
Recovery Act ("RCRA"), 42 U.S.C. ss.6901, et seq., and any other applicable
federal, state or local law, regulation, ordinance or requirement (including
consent decrees and administrative orders) relating to or imposing liability or
standards of conduct concerning any hazardous, toxic, or dangerous waste,
substance or material, all as amended and modified from time to time. For
purposes of this Lease, the term "hazardous material" means: (i) "hazardous
substances" or "toxic substances" as those terms are defined by CERCLA, or any
other environmental law, (ii) "hazardous wastes," as that term is defined by
RCRA; (iii) any pollutant or contaminant or hazardous, dangerous, or toxic
chemicals, materials, or substances within the meaning of any environmental law;
(iv) crude oil or any fraction of it that is liquid at standard conditions of
temperature and pressure (60 degrees Fahrenheit and 14.7 pounds per square inch
absolute); (v) any radioactive material, including any source, special nuclear,
or by-product material as defined at 42 U.S.C. ss.201 1, et seq., as amended to
and after this date; (vi) asbestos in any form or condition; and (vii)
polychlorinated biphenyls (PCBs) or substances or compounds containing PCBs.
13.2 Tenant's Compliance With Law and Environmental Matters. Tenant
represents, warrants and covenants to Landlord that Tenant will cause the
activities of the Tenant, its agents, employees, contractors and suppliers at
the Premises at all times to be and remain in compliance with all environmental
laws. Tenant agrees to obtain and keep in effect all governmental permits and
approvals relating to the use or operation of the Premises required by
applicable environmental laws for Tenant's business, and Tenant agrees to comply
with the terms of the same.
13.3 Tenant's Use of Hazardous Materials. Tenant represents, warrants and
covenants to Landlord that Tenant will not cause or permit to occur through the
actions of its agents or employees, contractors and suppliers any generation,
manufacture, storage, treatment, transportation, release, or disposal of
hazardous material on, in, under, about or from the Premises except in
quantities required for the conduct of Tenant's business and pursuant to
handling practices permitted by applicable law (including, but not limited to,
all environmental laws). If Tenant or any one of its employees, agents,
contractors, suppliers or invitees causes, contributes to or aggravates any
release or disposal of any hazardous material on, in, under or about the
Premises, Tenant, at its own cost and expense, will immediately take such action
as is necessary to detain the spread of and remove the hazardous material to the
extent of Tenant's responsibility to the reasonable satisfaction of Landlord and
the appropriate governmental authorities.
13.4 Notification and Cure. Landlord and Tenant each represents, warrants
and covenants to the other that it will immediately notify the other and provide
copies upon receipt of all written complaints, claims, citations, demands,
inquiries, reports, or notices relating to compliance with environmental laws.
With respect to any spill or discharge of hazardous materials caused by Tenant,
its agent or employees, contractors and suppliers, Tenant will, at its sole
cost, (a) promptly cure and have dismissed with prejudice any such actions,
resulting from such spill or discharge and (b) keep the Premises free of any
lien imposed pursuant to any environmental laws, as a result of such spill or
discharge.
13.5 Investigation by Landlord. Landlord shall have the right at all
reasonable times and from time to time to conduct environmental audits of the
Premises at Landlord's cost and expense, and Tenant will cooperate in the
conduct of those audits. The audits will be conducted by a consultant of
Landlord's choosing, and if any hazardous material (other than quantities
handled as permitted by law) is detected and is the direct result of a violation
of any of Tenant's warranties, representations, or covenants contained in this
section, the fees and expenses of such consultant will be borne by Tenant and
will be paid as additional rent under this Lease on demand by Landlord.
13.6 Breach by Tenant. If Tenant breaches or fails to comply with any of
the foregoing warranties, representations, and covenants, and the Tenant has
failed to unertake the actions reasonably necessary in taking into account the
nature of and extent to which any hazardous materials are present on the
Premises as a result of such breach or failure to comply, Landlord may after
sixty (60) days prior written notice to Tenant cause the removal (or other
cleanup reasonably acceptable to Landlord) of any hazardous material released by
Tenant from the Premises. The costs of such hazardous material removal and any
other cleanup (including transportation and storage costs) will be additional
rent under this Lease, whether or not a court or administrative agency has
ordered the cleanup, due and payable on Landlord's demand. Tenant hereby grants
Landlord, its employees, agents and contractors, reasonable access to the
Premises to remove or otherwise clean up any hazardous material. Landlord,
however, has no affirmative obligation to remove or otherwise clean up any
hazardous material, from the Premises, and nothing in this Lease will be
construed as creating any such obligation, except as set forth in Section 13.7
below.
13.7 Indemnification. Tenant represents, warrants and covenants to Landlord
that Tenant shall indemnify, defend, and hold the Premises and Landlord free and
harmless from and against all losses, liabilities, obligations, penalties,
claims, litigation, demands, defenses, costs, judgments, suits, proceedings,
damages (including consequential damages), disbursements, or expenses of any
kind (including attorneys' and experts' fees and expenses and fees and expenses
incurred in investigating, defending, or prosecuting any litigation, claim, or
proceeding) that may at any time be imposed upon, incurred by, asserted, or
awarded against Landlord or any of them in connection with or arising from or
out of (i) any hazardous material on, in, under, or affecting all or any portion
of the Premises that was caused by Tenant's occupancy of the Premises; (ii) any
misrepresentation, inaccuracy, or breach of any warranty, covenant, or agreement
by Tenant contained or referred to in this Article XIII; (iii) any violation or
claim of violation by Tenant, its employees, agents, contractors, or suppliers
of any environmental law; or (iv) the imposition of any lien against the
Premises for the recovery of any costs for environmental cleanup or other
response costs relating to the release or threatened release of hazardous
material used and released by Tenant; provided, however, in no event will Tenant
be responsible for any loss, costs, expenses or damages resulting from any
hazardous material located on, under or about the Premises prior to the
Commencement Date or on any real estate adjacent to the Premises at any time
where Tenant has not caused such hazardous material to be located thereon
(collectively, "Pre-Existing Environmental Conditions"). This indemnification is
the continuing obligation of Tenant and shall survive termination of this Lease.
Tenant, its successors, and assigns waive, release, and agree not to make any
claim or bring any cost recovery action against Landlord or any Landlord Party
under CERCLA or any state equivalent or any similar law now existing or enacted
after this date, except for any claim with respect to any Pre-Existing
Environmental Conditions.
ARTICLE XIV
MISCELLANEOUS
14.1 Time is of Essence. Whenever any payment is to be made under this
Lease by Tenant at or within a specified time, or whenever any act is to be done
under this Lease by either party at or within a stated time, time is of the
essence.
14.2. No Recording. Neither party shall record this Lease without the prior
written consent of the other; provided, however, if requested by Tenant,
Landlord and Tenant shall execute a memorandum of this Lease, in recordable
form, memorializing the existence, term, option to purchase granted under any
other provisions reasonably requested by Tenant with respect to this Lease, and
Tenant may cause such memorandum to be recorded, at Tenant's expense, in the
appropriate governmental office or in the Property Jurisdiction.
14.3 Captions. The captions and headings herein are for convenience and
reference only and do not limit or construe the provisions hereof.
14.4 Severability. If any term, condition, covenant, agreement or provision
of this Lease, or the application thereof to any circumstance shall, to any
extent, be held by a court of competent jurisdiction or by any authorized
governmental authority to be invalid, void or unenforceable, the remainder of
this Lease shall not be affected by such holding, and the remaining terms,
conditions, covenants, agreements and provisions hereof shall continue in and be
accorded full force and effect.
14.5 Entire Agreement. This Lease represents the entire agreement between
the parties hereto with respect to the Premises, and there are no agreements,
understandings or undertakings relating to said subject matter except as set
forth herein, and all prior negotiations and writings between the parties and
their representatives, attorneys, brokers and agents are superseded hereby and
thereby.
14.6 Modifications. This Lease may not be amended, modified or supplemented
except by a writing, executed by the party against whom such amendment,
modification or supplement is sought to be enforced.
14.7 No Continuing Waiver. No waiver of any term, condition, covenant or
remedy hereunder or delay in the enforcement of any remedy hereunder in any one
instance shall be deemed to be a waiver of any other term, condition, covenant
or remedy in such instance or of such waived or delayed term, condition,
covenant or remedy in any other instance.
14.8 Binding. All of the terms, conditions, covenants, agreements and
provisions of this Lease shall be construed as covenants running with the land
and shall inure to the benefit of and be binding upon the parties hereto and
upon their respective personal representatives, heirs, successors and permitted
assigns.
14.9 Collection; Attorney's Fees. In the event Tenant defaults in its
obligations to pay Base Rent or additional rent or any other sum due and payable
hereunder, or if Landlord defaults in the performance of its obligations under
this Lease, the non-defaulting party shall be entitled to reimbursement from the
defaulting party for all of the non-defaulting party's costs of collection
(including reasonable attorney's fees), regardless of whether or not a suit has
been commenced. In the event any action is brought by Landlord or Tenant to
enforce any other provision of this Lease, the prevailing party shall be
entitled to an award of its costs and reasonable attorney's fees.
Notwithstanding anything to the contrary, Tenant agrees to look solely to
Landlord's interest in the Premises for the recovery of any judgment from
Landlord, it being agreed that Landlord and Landlord's partners, whether general
or limited (if Landlord is a partnership) or its directors, officers or
shareholders (if Landlord is a corporation), shall never be personally liable
for any such judgment.
14.10 Governing Law. This Lease shall be construed under the laws of the
Property Jurisdiction.
14.11 Option to Purchase.
In consideration of the mutual promises contained in this Lease, as a material
provision thereof, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, Landlord hereby grants and
conveys to Tenant or its nominee the exclusive and irrevocable option ("Option")
to purchase the Premises for the "Purchase Price" as defined in Section
14.11(b), below.
(b) The "Purchase Price" for the purchase of the Premises under the Option shall
be (i) the price mutually-acceptable to Landlord and Tenant, as agreed upon by
such parties within thirty (30) days after Tenant's exercise of the Option, or
(ii) in the event the parties cannot agree within that 30-day period upon a
mutually-acceptable price for the purchase of the Premises under the Option,
within sixty (60) days after Tenant's exercise of the Option, Landlord and
Tenant shall each appoint a reputable real estate appraiser licensed within the
Property Jurisdiction to conduct appraisals to establish the fair market value
("Value") of the real property and improvements constituting the Premises.
Within thirty (30) days after being so appointed, each of the appraisers shall
deliver to both Landlord and Tenant a written appraisal of the Value, and each
party shall be responsible for the appraiser's fee for the appraiser appointed
by such party. In the event that the Value established by one of the appraisals
is not more than ten percent (10%) higher than the Value established by the
other appraisal, and in the event the difference between the Values in the two
appraisals is not more than [$10,000], the Purchase Price shall be calculated by
adding the two Values and dividing the sum by two. In the event the Value
established by one appraisal is more than ten percent (10%) greater than the
Value established by the other appraisal, or where such difference between the
two Values in the appraisals is greater than [$10,000], the appraisers shall
attempt, for a period of thirty days after the latter appraisal is delivered, to
reach a consensus on an agreed Value, and if they cannot do so within that time,
or if either Landlord or Tenant objects to such agreed Value, either Landlord or
Tenant may advise the appraisers in writing of such objection (with a copy to
the other party) ("Objection Notice"). Upon delivery of the Objection Notice,
the appraiser appointed by the Landlord and the appraiser appointed by the
Tenant shall jointly appoint a third appraiser within fifteen (15) days after
the receipt of the Appraisal Notice. The third appraiser shall deliver to
Landlord and Tenant a report appraising the Value of the Premises within thirty
(30) days after such third appraiser's appointment, and the Value of the
Premises established by such third appraisal shall be conclusively deemed to be
the Purchase Price for purposes of Tenant's purchase of the Premises under the
Option.
(c) The Option shall commence on the date which is twelve [twenty-four for Tech
Center] calendar months after the Commencement Date ("Effective Option Date") of
the Lease and shall continue throughout the term of the Lease, including any
Renewal Term. The Option shall be exercised by Tenant's written notice to
Landlord of its election to purchase the Premises delivered no sooner than the
Effective Option Date, and shall be effective upon service of such notice to
exercise the Option (i) actually served upon the Landlord by personal delivery
or (ii) placed in an envelope directed to the Landlord at the address shown in
the Lease and deposited in the United States mail by certified or registered
mail, postage prepaid.
(d) If this Option is exercised, Tenant's obligations hereunder are subject to
the satisfaction of the following conditions:
(i) Within sixty (60) days after exercise of the Option, Tenant shall
have received, at Landlord's expense, a satisfactory survey ("Survey")
of the Premises certified as of a current date, showing the location
of all improvements and easements or restrictions located thereon.
(ii) Tenant must be satisfied that all of the Buildings and
Improvements on the Premises are located entirely within the bounds of
the Land, that there are no encroachments thereon and no existing
violations of zoning ordinances or other restrictions applicable to
the Land, and that there are no matters shown on any Survey of the
Premises that are objectionable to Tenant.
(iii) Within five (5) days after Landlord receives notice of the
exercise of this Option, Landlord shall order for Tenant, as soon as
the same can be prepared, a commitment for an owner's policy of title
insurance issued by a title insurance company satisfactory to Tenant
("Title Insurer"), in which the Title Insurer shall agree to insure
merchantable title in the name of Tenant after delivery of a general
warranty deed to Tenant from Landlord (irrespective of the date the
deed is recorded), and agrees to delete all standard pre-printed
exceptions in the standard form of owner's policy. Such title
insurance policy shall insure title for the full amount of the
Purchase Price and shall be at the expense of the party which would
bear such costs in accordance with the customary practice for real
estate transactions in the Property Jurisdiction. Landlord shall
convey title in the Land subject only to those title matters approved
by Tenant in writing, and Landlord shall use its best efforts to
remove any liens or encumbrances on the Premises as shown in the title
commitment or on the Survey. In the event Landlord fails or refuses to
remove any defect of title which can be removed by the payment of
money, Tenant shall be entitled, as part of the closing of Tenant's
purchase of the Premises, to make provision for the payment of such
amounts, and Tenant shall receive a credit against the Purchase Price
for any amounts so paid.
(iv) All taxes and assessments on the Premises shall be pro-rated as
of date of closing; provided, however, Landlord shall be responsible
for the payment of any transfer taxes or fees in connection with
conveyance of the Premises under the Option.
(v) Tenant shall be entitled, at Tenant's sole expense, to conduct any
and all tests or studies on the Premises as Tenant may deem advisable,
including any environmental testing, results of which tests or studies
shall be subject to Tenant's approval.
(vi) If any of the foregoing conditions are not met to Tenant's
complete satisfaction, Tenant may cancel or postpone for up to 180
days its purchase of the Premises upon written notice to Landlord. If
the Tenant cancels its purchase for any reason other than a defect in
title, Tenant shall reimburse Landlord for any costs for title
searches.
(e) (i) At the date of closing Landlord shall execute and deliver a general
warranty deed conveying the Land in the same condition as it is now in, ordinary
wear and tear excepted, a Vendor's Affidavit, a ▇▇▇▇ of Sale for any items of
personal property owned by Landlord located at the Premises and used in
connection with the operation of the Premises, a non-foreign affidavit, and any
and all other documents reasonably required by Tenant or customarily provided by
sellers of real property in the Property Jurisdiction, all in form and substance
satisfactory to Tenant.
(ii) The closing shall take place at the office of the Title Insurer
on a date and time designated by Tenant after all conditions to closing
have been satisfied but in no event prior to the date which is six (6)
calendar months after Tenant's exercise of the Option.
(iii) At the closing, Tenant shall pay to Landlord the Purchase Price,
less any credits against the Purchase Price as provided under this Option.
Landlord and Tenant shall each pay one-half of any closing fee charged by
the Title Insurer.
(iv) The Lease shall remain in full force and effect until the date on
which title to the Premises is vested in Tenant.
(v) The Lease shall in every event terminate at later of end of lease
or date on which Tenant decides not to consummate the purchase of the
Premises under this Option.
14.12 Cross Default With Other Leases. Landlord and Tenant have entered
into certain other leases described in Exhibit C attached hereto (the "Other
Leases"). Landlord and Tenant agree that in the event that either Landlord or
Tenant is in breach of any term, condition or covenant under any of the Other
Leases after the expiration of any applicable cure period permitted under the
applicable Other Lease, then the party in breach of such applicable Other Lease
shall be in default under this Lease and the non-defaulting party shall be
entitled to immediately exercise any right granted to such non-defaulting party
hereunder as if the party in breach of such Other Lease were in default
hereunder and all applicable cure periods herein had expired.
IN WITNESS WHEREOF, the parties have executed this instrument as of the
day and year first above written.
Landlord: THE BLIN CORPORATION, an Iowa corporation
By: _____________________________________________
Name: ___________________________________________
Its: ____________________________________________
Tenant: _________________________________________________
By: _____________________________________________
Name: ___________________________________________
Its: ____________________________________________
EXHIBIT B
RULES AND REGULATIONS
1. The sidewalks, truck drives, entrances, passages, stairways, corridors or
halls shall not be unreasonably, permanently obstructed or used for any
purpose other than ingress, egress, loading and unloading.
2. No awnings or other projection shall be attached to the outside walls of
the Premises without the prior written consent of Landlord. No curtains,
blinds, shades or screens shall be attached to, hung in or used in
connection with any window or door of the Premises without the prior
written consent of Landlord.
3. Unless Tenant shall repair and restore the same at the expiration of the
Lease, Tenant shall not ▇▇▇▇, paint, drill into or in any way deface any
part of the Premises, and no boring, cutting or stringing of wires shall be
permitted except with the prior written consent of Landlord and as Landlord
may direct.
4. Tenant shall not cause or permit any unusual or objectionable odors to be
produced upon or emanate from the Premises, taking into account the
industrial character of the Premises.
5. The Premises shall not be used for lodging, sleeping or any immoral or
illegal purpose.
6. Tenant shall not make or permit to be made any unseemly or disturbing
noises or disturb or interfere with occupants of the Premises, neighboring
buildings or premises or those having business with them, taking into
account the industrial character of the Premises.
7. No additional surface mounted locks or bolts of any kind shall be placed
upon the exterior of any of the doors or windows of the Premises by Tenant
without Landlord's prior written approval. Except as otherwise stated
immediately above, Tenant shall have the right to change any of the locks
in the Premises following delivery to Landlord of notice of such change
along with the keys that fit the new locks. Tenant must, upon termination
of its tenancy, return to Landlord all keys associated with the Premises;
and in the event of the loss of any keys so furnished, Tenant shall pay to
Landlord the cost of replacing the same or of changing the lock or locks
opened by such lost key if Landlord shall deem it necessary to make such
change.
8. Landlord reserves the option to reasonably prescribe the weight and
position of all unusually heavy objects, so long as the placement of such
objects does not unreasonably interfere with the efficient operation of
Tenant's business conducted from the Premises. Objects must be placed upon
supports approved by Landlord to distribute such weight, which supports
shall be installed at Tenant's sole expense.
9. Canvassing, soliciting and peddling in the Premises are prohibited; and
Tenant shall cooperate to prevent the same.
10. There shall not be used in any space or in the public halls of the
Premises, either by Tenant or others, any hand trucks except those equipped
with rubber tires.
11. All doors and truck doors opening to the exterior of the Premises shall be
kept closed except when in use for ingress, loading, unloading, egress and
for reasonable air circulation.
12. Landlord may at any time revoke, supplement or modify these Rules and
Regulations or any portions thereof whenever, in Landlord's reasonable
opinion, such changes are required for the care, cleanliness, safety or
preservation of good order in the Premises, subject to rule 15 below. All
such changes shall be effective five (5) days after delivery to Tenant of
written notice thereof except in the event of emergency, in which event
such changes shall be effective immediately upon receipt.
13. Tenant shall not conduct any business activities other than ingress,
egress, loading and unloading or store any materials outside of the
Premises or allow the same by Tenant's invitees, customers, contractors or
employees.
14. In the event of any conflict between the terms of these Rules and
Regulations and the terms set forth in the main body of the Lease, the
terms in the main body of the Lease shall govern.
15. In the event Landlord's consent is required for any items herein, such
consent shall not be unreasonably withheld, conditioned or delayed.
EXHIBIT C
OTHER LEASES
[TO BE COMPLETED PRIOR TO CLOSING]
Exhibit 8.2(m)
NON-COMPETITION AGREEMENT
NON-COMPETITION AGREEMENT (this "Agreement") made the ___ day of
__________________, 1999 by and between Alltrista Corporation, an Indiana
corporation ("Buyer"), and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ("Executive").
WITNESSETH:
WHEREAS, in a related transaction, Buyer agreed to acquire certain of the
assets and properties of Triangle Plastics, Inc., an Iowa corporation, and its
subsidiary (collectively, "Seller"), pursuant to a certain Asset Purchase
Agreement (the "Asset Purchase Agreement") dated ________________, 1999 by and
among Buyer, Seller, TriEnda Corporation and ▇▇▇▇▇ ▇. ▇▇▇▇ (the "Purchase
Agreement"), subject to the Executive executing and delivering this Agreement to
Buyer or its affiliates. Capitalized terms used but not defined herein have the
meanings set forth in the Asset Purchase Agreement.
WHEREAS, the Executive is an employee and/or owner of Seller, and will
benefit both directly and indirectly from the purchase of the assets and
properties of Seller by Buyer or its affiliates and Executive is also party to a
Consulting Agreement of even date herewith under which Buyer provides valuable
consideration to Executive.
WHEREAS, Buyer desires to protect its purchase of the assets and properties
of Seller by assuring that the Executive's knowledge and information concerning
the business and operations of Seller and Buyer, and the services of the
Executive, will not be used in competition with the business and operations of
Buyer or its affiliates.
NOW, THEREFORE, in order to induce Buyer to complete the transactions under
the Purchase Agreement, the Executive hereby covenants and agrees as follows:
1. Covenants of the Executive
a. Confidentiality. Executive acknowledges that in his position as an
employee and/or owner of Seller, he has made use of, acquired, and added to
confidential information of a special and unique nature deriving independent
economic value, actual or potential, from not being generally known to, and not
being readily ascertainable by proper means by, other persons who can obtain
economic value from its disclosure or use (specifically excluding any
information generally available to the public at large or disclosed by Buyer to
third parties or any information disclosed because Executive has a legal
obligation to make such disclosure). Such information is hereinafter referred to
as "Confidential Information" and includes, without limitation, the following
information: customers, vendors, products, systems, data files, manuals,
confidential reports, the amounts paid by or to customers, licensors, licensees,
and vendors, the amounts paid for products and services, and other trade secrets
and information Executive knows or has reason to know, or will know or have
reason to know, Buyer intends or expects to remain confidential. As a material
inducement to Buyer to enter into the Asset Purchase Agreement, Executive
covenants and agrees that he shall not, from and after the closing of the
transaction described in the Purchase Agreement and for a period of two (2)
years following such closing date, divulge or disclose for any purpose
whatsoever any Confidential Information except to the extent such information is
or becomes generally available to the public at large or disclosed by Buyer to
third parties or any information disclosed because Seller or Executive has a
legal obligation to make such disclosure. Notwithstanding the foregoing,
Executive may reveal Confidential Information to the extent necessary to
determine amounts due ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ pursuant to the
TriEnda Agreement and to enforce rights under the TriEnda Agreement, including
furnishing such information to investment bankers, appraisers, lawyers,
accountants, courts and arbitrators.
b. Non-Competition. During the two (2) year period following the date of
this Agreement, Executive shall not, except as may be required by law or as may
be done with Buyer's written consent, directly or indirectly, either as a
shareholder, member, principal, co-partner, agent, financier, lender,
consultant, manager or in any other individual or representative capacity
whatsoever (i) engage in any activities competitive with the Business or the
pallet logistics or refurbishing business in the United States of America, (ii)
solicit, serve, divert or assist any person in so soliciting, servicing or
diverting any customers or vendors of Buyer or any of its affiliates to the
extent such actions are related to the Business in the United States of America,
(iii) solicit the employment of any of the employees of Seller or its subsidiary
that are employed by Buyer pursuant to the Asset Purchase Agreement. The
foregoing shall not apply to (i) the activities of any entity of which Executive
owns or beneficially owns less than ten percent (10%) of the outstanding voting
power or (ii) attending industry meetings or (iii) own and hold ownership
interests in DekoRRA Products, LLC, the principal of which is Executive's son,
and provide services and counsel to such Company, so long as Executive does not
otherwise violate the terms of this Agreement.
c. Scope of Restrictive Covenants. The Executive agrees that all of the
restraints imposed in this Section 1 are necessary for the reasonable and proper
protection of Buyer and its affiliates, and that each and every one of the
restraints is reasonable in terms of subject matter, duration, and geographic
scope.
d. Enforceability. The covenants contained in this Section 1 shall be
enforceable by Buyer. This Agreement may not be assigned without the express
written consent of Executive and any assignment without such consent shall be
null and void. The covenants contained in this Section 1 shall not be
enforceable against any employer of Executive, or against Executive in the
course of such employment, if prior to such employment such employer was engaged
in a business substantially similar to the Business, and the Executive is not
directly or indirectly involved in the Business activities of such employer.
e. Remedies for Breach. The Executive acknowledges that the covenants and
agreements in this Section 1 are necessarily of a special, unique and
extraordinary nature, and that the loss arising from a breach thereof cannot
reasonably and adequately be compensated by money damages and will cause Buyer
or its affiliates to suffer irreparable harm. Accordingly, the Executive
consents and agrees that upon the failure of the Executive to comply with the
provisions of this Section 1 at any time, Buyer or its affiliates shall be
entitled, among and in addition to any other rights or remedies available
hereunder or otherwise, to injunctive or other extraordinary relief to prevent
the Executive from committing or continuing a breach of such provisions.
2. Miscellaneous.
a. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the state of Minnesota applicable to agreements made
and to be performed within such state.
b. Merger, Amendment, Counterparts. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof, and
supersedes all prior agreements with respect thereto, and may not be changed or
modified except by an instrument in writing, signed by the parties. This
Agreement may be executed in counterparts, both of which taken together shall
constitute but one and the same instrument.
c. Notices. Any notice or other communication required or permitted under
this Agreement shall be given in writing and must be delivered in person or by
deposit in the United States mail, postage prepaid, return receipt requested,
addressed as follows:
To Executive: ----------------------------
----------------------------
----------------------------
----------------------------
To Buyer: Alltrista Corporation
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Any party may designate by written notice to the other party any change in
address to which notices and other communications shall be sent. All notices and
other communications shall be deemed effective upon receipt if delivered in
person and three (3) days after deposit in the mail if delivered by United
States mail.
d. Severability. If for any reason any portion of any provision of this
Agreement is declared invalid, void, or unenforceable by a court of competent
jurisdiction, the validity and binding effect of any remaining provisions of
this Agreement shall remain in full force and effect as if this Agreement had
been executed with the invalid, void, or unenforceable portion or provision
eliminated.
e. Waiver. The failure of any of the parties to insist upon the strict
performance of any provision of this Agreement or to exercise any right, power
or remedy upon a breach thereof shall not constitute a waiver of that or any
other provision of this Agreement, or limit that party's right thereafter to
enforce any provision or exercise any right.
f. Dispute Resolution. The dispute resolution provisions of Article IX of
the Asset Purchase Agreement shall apply to this Agreement as if set forth
herein, mutatis mutandis.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the day and year first above written.
BUYER:
ALLTRISTA CORPORATION
By:
----------------------------------
Its:
---------------------------------
EXECUTIVE:
-------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
NON-COMPETITION AGREEMENT
NON-COMPETITION AGREEMENT (this "Agreement") made the ___ day of
__________________, 1999 by and between Alltrista Corporation, an Indiana
corporation ("Buyer"), and ▇▇▇▇▇ ▇. ▇▇▇▇ ("Executive").
WITNESSETH:
WHEREAS, in a related transaction, Buyer agreed to acquire certain of the
assets and properties of Triangle Plastics, Inc., an Iowa corporation, and its
subsidiary (collectively, "Seller"), pursuant to a certain Asset Purchase
Agreement (the "Asset Purchase Agreement") dated ________________, 1999 by and
among Buyer, Seller, TriEnda Corporation and ▇▇▇▇▇ ▇. ▇▇▇▇ (the "Purchase
Agreement"), subject to the Executive executing and delivering this Agreement to
Buyer or its affiliates. Capitalized terms used but not defined herein have the
meanings set forth in the Asset Purchase Agreement.
WHEREAS, the Executive is an employee and/or owner of Seller, and will
benefit both directly and indirectly from the purchase of the assets and
properties of Seller by Buyer or its affiliates and Executive is also party to a
Consulting Agreement of even date herewith under which Buyer provides valuable
consideration to Executive.
WHEREAS, Buyer desires to protect its purchase of the assets and properties
of Seller by assuring that the Executive's knowledge and information concerning
the business and operations of Seller and Buyer, and the services of the
Executive, will not be used in competition with the business and operations of
Buyer or its affiliates.
NOW, THEREFORE, in order to induce Buyer to complete the transactions under
the Purchase Agreement, the Executive hereby covenants and agrees as follows:
1. Covenants of the Executive
a. Confidentiality. Executive acknowledges that in his position as an
employee and/or owner of Seller, he has made use of, acquired, and added to
confidential information of a special and unique nature deriving independent
economic value, actual or potential, from not being generally known to, and not
being readily ascertainable by proper means by, other persons who can obtain
economic value from its disclosure or use (specifically excluding any
information generally available to the public at large or disclosed by Buyer to
third parties or any information disclosed because Executive has a legal
obligation to make such disclosure). Such information is hereinafter referred to
as "Confidential Information" and includes, without limitation, the following
information: customers, vendors, products, systems, data files, manuals,
confidential reports, the amounts paid by or to customers, licensors, licensees,
and vendors, the amounts paid for products and services, and other trade secrets
and information Executive knows or has reason to know, or will know or have
reason to know, Buyer intends or expects to remain confidential. As a material
inducement to Buyer to enter into the Asset Purchase Agreement, Executive
covenants and agrees that he shall not, from and after the closing of the
transaction described in the Purchase Agreement and for a period of five (5)
years following such closing date, divulge or disclose for any purpose
whatsoever any Confidential Information except to the extent such information is
or becomes generally available to the public at large or disclosed by Buyer to
third parties or any information disclosed because Seller or Executive has a
legal obligation to make such disclosure. Notwithstanding the foregoing,
Executive may reveal Confidential Information to the extent reasonably necessary
to determine amounts due ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ pursuant to the
TriEnda Agreement and to enforce rights under the TriEnda Agreement, including
furnishing such information to investment bankers, appraisers, lawyers,
accountants, courts and arbitrators.
b. Non-Competition. During the five (5) year period following the date of
this Agreement, Executive shall not, except as may be required by law or as may
be done with Buyer's written consent, directly or indirectly, either as a
shareholder, member, principal, co-partner, agent, financier, lender,
consultant, manager or in any other individual or representative capacity
whatsoever (i) engage in any activities competitive with the Business or the
pallet logistics or refurbishing business in the United States of America, (ii)
solicit, serve, divert or assist any person in so soliciting, servicing or
diverting any customers or vendors of Buyer or any of its affiliates to the
extent such actions are related to the Business in the United States of America,
(iii) solicit the employment of any of the employees of Seller or its subsidiary
that are employed by Buyer pursuant to the Asset Purchase Agreement. The
foregoing shall not apply to (i) the activities of any entity of which Executive
owns or beneficially owns less than ten percent (10%) of the outstanding voting
power or (ii) attending industry meetings or conferences of the Society of
Plastics Engineers.
c. Scope of Restrictive Covenants. The Executive agrees that all of the
restraints imposed in this Section 1 are necessary for the reasonable and proper
protection of Buyer and its affiliates, and that each and every one of the
restraints is reasonable in terms of subject matter, duration, and geographic
scope.
d. Enforceability. The covenants contained in this Section 1 shall be
enforceable by Buyer. This Agreement may not be assigned without the express
written consent of Executive and any assignment without such consent shall be
null and void. The covenants contained in this Section 1 shall not be
enforceable against any employer of Executive, or against Executive in the
course of such employment, if prior to such employment such employer was engaged
in a business substantially similar to the Business, and the Executive is not
directly or indirectly involved in the Business activities of such employer.
e. Remedies for Breach. The Executive acknowledges that the covenants and
agreements in this Section 1 are necessarily of a special, unique and
extraordinary nature, and that the loss arising from a breach thereof cannot
reasonably and adequately be compensated by money damages and will cause Buyer
or its affiliates to suffer irreparable harm. Accordingly, the Executive
consents and agrees that upon the failure of the Executive to comply with the
provisions of this Section 1 at any time, Buyer or its affiliates shall be
entitled, among and in addition to any other rights or remedies available
hereunder or otherwise, to injunctive or other extraordinary relief to prevent
the Executive from committing or continuing a breach of such provisions.
2. Miscellaneous.
a. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the state of Minnesota applicable to agreements made
and to be performed within such state.
b. Merger, Amendment, Counterparts. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof, and
supersedes all prior agreements with respect thereto, and may not be changed or
modified except by an instrument in writing, signed by the parties. This
Agreement may be executed in counterparts, both of which taken together shall
constitute but one and the same instrument.
c. Notices. Any notice or other communication required or permitted under
this Agreement shall be given in writing and must be delivered in person or by
deposit in the United States mail, postage prepaid, return receipt requested,
addressed as follows:
To Executive: -----------------------------
-----------------------------
-----------------------------
-----------------------------
To Buyer: Alltrista Corporation
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Any party may designate by written notice to the other party any change in
address to which notices and other communications shall be sent. All notices and
other communications shall be deemed effective upon receipt if delivered in
person and three (3) days after deposit in the mail if delivered by United
States mail.
d. Severability. If for any reason any portion of any provision of this
Agreement is declared invalid, void, or unenforceable by a court of competent
jurisdiction, the validity and binding effect of any remaining provisions of
this Agreement shall remain in full force and effect as if this Agreement had
been executed with the invalid, void, or unenforceable portion or provision
eliminated.
e. Waiver. The failure of any of the parties to insist upon the strict
performance of any provision of this Agreement or to exercise any right, power
or remedy upon a breach thereof shall not constitute a waiver of that or any
other provision of this Agreement, or limit that party's right thereafter to
enforce any provision or exercise any right.
f. Dispute Resolution. The dispute resolution provisions of Article IX of
the Asset Purchase Agreement shall apply to this Agreement as if set forth
herein, mutatis mutandis.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the day and year first above written.
BUYER:
ALLTRISTA CORPORATION
By:
----------------------------------
Its:
---------------------------------
EXECUTIVE:
-------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇
Exhibit 8.3(e)
Buyer's Opinion
[Subject to approval of IMDR Opinions Committee]
March , 1999
▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇
Triangle Plastics, Inc.
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We have acted as counsel for Alltrista Corporation, an Indiana corporation
(the "Buyer"), in connection with the Asset Purchase Agreement (the "Purchase
Agreement"), dated as of March ___, 1999, by and between the Buyer, Triangle
Plastics, Inc., an Iowa corporation ("Triangle"), TriEnda Corporation, a
Wisconsin corporation and Triangle's wholly-owned subsidiary ("Subsidiary", and
collectively with Triangle, the "Seller"), and ▇▇▇▇▇ ▇. ▇▇▇▇ ("Shareholder") and
the ▇▇▇▇ of Sale and the Assignment and Assumption Agreement (collectively, the
"Transaction Documents"). This opinion is being provided to you pursuant to
Section 8.3(e) of the Purchase Agreement. All capitalized terms used herein
without definition shall have the respective meanings assigned to such terms in
the Purchase Agreement.
In giving this opinion, we have examined copies of the Transaction
Documents, and originals or copies certified to our satisfaction of certain
corporate records of the Buyer and such other documents, records and other
matters as are in our opinion appropriate or necessary to enable us to render
this opinion. As to factual matters relevant to our opinions expressed below, we
have, without independent investigation, relied upon the representations and
warranties made in the Purchase Agreement and upon certificates of officers of
the Buyer and of public officials, and upon public records. In stating our
opinion, we have assumed the genuineness of all certificates and signatures and
the authenticity of all documents submitted to us as original counterparts or as
certified or photostatic copies.
In rendering this opinion letter to you, we have assumed with your
permission:
a) Each of the Transaction Documents has been or will be duly entered into,
executed, received and delivered by Seller, Subsidiary and Shareholder, as
applicable, and upon such execution and delivery constitute the legal,
valid and binding obligations of such parties, so that all of such
instruments have mutuality of binding effect.
b) The respective factual representations, statements and warranties of the
Buyer in the Transaction Documents, and in the other documents which we
have reviewed, and upon which we have relied, are accurate, complete and
truthful.
c) The execution and delivery of the Transaction Documents by all parties
thereto will be free of intentional or unintentional mistake, fraud, undue
influence, duress or criminal activity.
d) Each of the Transaction Documents has been appropriately completed,
executed and delivered in the forms submitted to us for review, with all
appropriate schedules and exhibits attached and all blanks appropriately
filled in.
e) All terms and conditions of, or relating to, the transactions are correctly
and completely contained in the Transaction Documents and the Transaction
Documents have not been otherwise amended or modified by oral or written
agreement or by conduct of the parties thereto.
Based upon the foregoing, and subject to the qualifications mentioned
below, we are of the opinion that:
1. The Buyer is a corporation validly existing under the laws of the State of
Indiana.
2. The Buyer has all necessary corporate power and corporate authority to
enter into the Transaction Documents and to consummate the transactions
contemplated thereby.
3. The Buyer has taken all necessary corporate action to authorize the
execution and delivery by it of the Transaction Documents.
4. The Transaction Documents have been executed and delivered by the Buyer and
are enforceable against the Buyer in accordance with their terms.
5. No approval of, or filing with, any Governmental Body is required in
connection with the execution, delivery and performance of the Transaction
Documents by Buyer pursuant to any law, rule or regulation or, to our
knowledge, pursuant to any order, judgment, decree, agreement or other
instrument, other than (i) notification and termination of all applicable
waiting periods under the HSR Act, (ii) any approval or filing that may be
required in connection with the transfer of government contracts and
permits, and (iii) filings and registrations necessary to record the
transfer of the Owned Intellectual Property.
6. The execution and delivery of the Transaction Documents, the consummation
of the transactions contemplated thereby, and the fulfillment of or
compliance with the terms and conditions of the Transaction Documents, do
not violate, conflict with, or result in a breach of any of the terms,
conditions, or provisions of:
(i) the Articles of Incorporation or Bylaws of the Buyer.
(ii) to our knowledge, any statute, law, writ, judgment, injunction, award
or decree of any consent, arbitration or governmental or regulatory
body against or binding upon, the Buyer. The opinions as expressed
herein are limited to those laws, statutes and regulations that a
lawyer exercising customary professional diligence would reasonably
recognize as being directly applicable to the Buyer and the
transactions contemplated by the Transaction Documents.
As a matter of fact and not as a legal opinion, we confirm to you that to
our knowledge there is no action, proceeding or investigation before any court,
governmental agency or other body or official pending or threatened in writing
against the Buyer questioning the validity of any action by Buyer in connection
with the execution, delivery and performance of each of the Transaction
Documents.
In addition to any assumptions, qualifications and other matters set forth
elsewhere herein, the opinions set forth above are subject to the following:
(A) Our opinion expressed in paragraph 1 as to the existence of the Buyer
is based solely on a certificate of the Secretary of State of the
State of Indiana dated March ___, 1999.
(B) Our opinion as to the enforceability of the Transaction Documents
described above is subject to bankruptcy, insolvency, moratorium,
reorganization, fraudulent conveyance, liquidation and other similar
laws generally affecting the rights of debtors or creditors.
(C) We note that certain of the agreements and other instruments executed
on the date hereof are governed by the laws of the State of Minnesota.
We have rendered our opinion as to the enforceability of the
agreements and any instrument executed as of the date hereof as if the
laws of the State of Indiana were the stated governing law. We render
no such opinion to the extent that the laws of the State of Indiana
are different from the laws of the State of Minnesota. The opinions
set forth herein are limited to the law of the State of Indiana and
the federal law of the United States of America. We do not express any
opinion as to any other law.
(D) Our opinion is subject to the effect of general principles of equity
(regardless of whether considered in a proceeding in equity or at law)
and matters of public policy which involve the exercise of judicial
discretion, including (without limitation) concepts of materiality,
reasonableness, good faith and fair dealing (regardless of whether
considered in a proceeding in equity or at law). No opinion is
expressed as to the enforceability of (i) the provision requiring
payment of attorneys' fees, (ii) self-help provisions, (iii) waiver of
constitutional rights, and (iv) provisions related to waivers of
remedies (or the delay or omission of enforcement thereof),
disclaimers, liability limitations with respect to third parties,
liquidated damages or the creation of remedies not available under
federal or Indiana law.
Whenever our opinion with respect to the existence or absence of facts is
indicated to be based on our knowledge or awareness, we are referring solely to
the actual knowledge of the following Ice ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇ attorneys who
have had primary responsibility in representing the Buyer in connection with the
Purchase Agreement and the consummation of the transactions contemplated
thereby: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇. We have not undertaken
any independent investigation to determine the existence or absence of facts and
no inference as to our knowledge concerning any facts should be drawn from the
fact that such representation has been undertaken by us.
This opinion is limited to the matters expressly set forth herein and no
opinion is implied or may be inferred beyond the matters expressly so stated.
This opinion is given as of the date hereof and we do not undertake any
liability or responsibility to inform you of any change in circumstances
occurring, or additional information becoming available to us after the date
hereof which might alter the opinions contained herein.
This opinion is furnished to you solely in connection with the transactions
described above and may not be relied upon by you for any other purpose or by
any other person in any manner or for any purpose.
Very truly yours,
Exhibit 8.3(l)
CONSULTING AGREEMENT\
THIS CONSULTING AGREEMENT (this "Agreement") is made and entered into as of
____________, 1999 by and between Alltrista Corporation, an Indiana corporation
("Alltrista") and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (the "Consultant").
BACKGROUND
A. Alltrista desires to and has offered to retain and engage the
Consultant, as an independent contractor, to make available to Alltrista, during
the term of this Agreement, the knowledge, experience and relationships of the
Consultant relating to the operation of the business formerly owned by Triangle
Plastics, Inc. as well as the acquisition of similar businesses, according to
the terms and conditions of this Agreement.
B. The Consultant is agreeable to such retention and engagement, according
to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
promises and covenants hereinafter set forth, the parties hereto agree as
follows:
SECTION I
CONSULTING AGREEMENT
1.1 Engagement of Consultant. Alltrista hereby retains and engages the
Consultant, and the Consultant hereby accepts such retention and engagement,
commencing as of the date hereof and continuing through termination in
accordance with Section 1.5 (the "Term"), to serve as, and in the capacity of,
an advisor and consultant with respect to the matters set forth in Section 1.2
hereof for the compensation hereinafter set forth.
1.2 Services of the Consultant. During the Term, the Consultant shall, on a
non-exclusive basis, undertake for and on behalf of, and to the extent
reasonably requested by Alltrista, to consult with and advise Alltrista with
respect to:
(i) the transition of the operation of the business formerly owned by
Triangle Plastics, Inc., such business having been purchased by Alltrista
as of the date hereof;
(ii) the acquisition of businesses similar to the business formerly owned
by Triangle Plastics, Inc., including advice regarding the selection of
businesses, the price to be paid, the structure of the acquisition and
post-acquisition operations; and
(iii) attend industry meetings, conferences and events as reasonably
requested by Alltrista.
1.3 Compensation. In consideration for all of the Services to be rendered
during the Term by the Consultant hereunder, Alltrista agrees to pay the
Consultant:
1.3.1 Alltrista shall make payments to Consultant totaling $200,000.00.
Such payments shall be payable in eight equal installments of $25,000 and shall
be paid on the last day of every third calendar month commencing on June 30,
1999 and ending with the final payment on March 31, 2001.
1.3.2 Alltrista shall promptly reimburse Consultant for reasonable expenses
associated with the Services rendered hereunder, for attending industry meetings
and trade shows upon presentation of documentation of such expenses.
1.3.3 Alltrista shall pay Consultant an amount equal to his COBRA payments
during each month of the Term, and such payments shall continue in equal amounts
after COBRA coverage expires for the remainder of the Term. Consultant shall be
responsible for maintaining his own health insurance coverage.
1.4 Time Commitment. The parties agree Consultant shall devote to his
activities hereunder an average of two days per week for the remainder of the
Term to the activities hereunder. Alltrista and Consultant shall work with one
another to schedule activities under this Agreement so as not to unreasonable
restrict Consultant's other activities.
1.5 Termination. The Term of this Agreement commences on the date hereof
and continues through March 31, 2001. Either party may terminate this Agreement
on 90 days notice; provided that Alltrista may only terminate this Agreement for
cause for Consultant's willful and continued failure to perform his duties
hereunder. . Sections 1.5, 3.1, 4.6, 4.7 and 4.8 shall survive termination.
SECTION II
RELATIONSHIP BETWEEN ALLTRISTA AND THE CONSULTANT
2.1 Independent Contractor. The Consultant is an independent contractor and
shall not be considered an employee, agent of, or joint venturer with, Alltrista
for any purpose whatsoever. The Consultant acknowledges and agrees that
Alltrista has no responsibility whatsoever (i) for the payment of any taxes,
including but not limited to duties, levies, assessments, income taxes, social
security taxes, payroll taxes, workers' compensation premiums, unemployment
insurance premiums or disability benefits which arise from the Consultant's
provision of the Services or (ii) for providing any employee benefits to the
Consultant. All such fees and taxes shall be paid by the Consultant.
2.2 Right to Contract with Others. Alltrista agrees Consultant shall be
free to provide services to others, provided, however, that Consultant shall not
provide such services if such services would violate the noncompetition
agreement between Alltrista and Consultant.
SECTION III
CONFIDENTIALITY
3.1 Confidential Information. Consultant hereby agrees that at all times he
shall maintain as confidential and hold in confidence all Confidential
Information as may be provided to Consultant by Alltrista. Consultant shall not
disclose publish or make use of Confidential Information without the prior
written consent of Alltrista unless such disclosure is required to be made by
law or Consultant obtains such information from an independent source. As used
in this Agreement, "Confidential Information" means any data or information of
or related to Alltrista's business which is valuable to Alltrista and not
generally known to competitors of Alltrista, including, without limitation,
general business information, industry information, analysis and other
information of a proprietary nature that relates to the business of Alltrista
(including any information relating to acquisitions Alltrista may undertake).
Confidential Information does not include any information which can be obtained
from a third party unaffiliated with Alltrista or which is otherwise in the
public domain.
SECTION IV
GENERAL PROVISIONS
4.1 No Waiver. No waiver of any term or provision of this Agreement shall
be effective unless in writing signed by the party purporting to have waived
such term or provision. The failure of any of the parties to insist upon the
strict performance of any provision of this Agreement or to exercise any right,
power or remedy upon a breach thereof shall not constitute a waiver of that or
any other provision of this Agreement, or limit that party's right thereafter to
enforce any provision or exercise any right.
4.2 Headings. The section and other headings contained in this Agreement
are for reference purposes only and shall not be deemed to be a part of this
Agreement or to affect the meaning or interpretation of this Agreement.
4.3 Merger, Amendment, Counterparts. This Agreement, the Asset Purchase
Agreement and the related noncompetition agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof, and may
not be changed or modified except by an instrument in writing, signed by the
parties. This Agreement may be executed in one or more counterparts, all of
which taken together shall constitute one and the same instrument.
4.4 Successors and Assigns. This Agreement and the rights and obligations
hereunder shall be binding upon and inure to the benefit of, the parties hereto
and their legal representatives, successors, heirs, beneficiaries and permitted
assigns, as the case may be. This Agreement and all rights hereunder cannot be
assigned by the parties hereto; provided that Consultant may assign his rights
and delegate his duties hereunder to an LLC solely owned by Consultant. Upon any
such assignment Consultant shall be deemed released from all of his obligations
hereunder except for those under Section 3.1.
4.5 Notices. Any notice or other communication required or permitted under
this Agreement shall be given in writing and shall be in the English language
and must be delivered by overnight courier or by facsimile. Notices shall be
addressed as follows:
If to the Alltrista: Alltrista Corporation
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile:
If to the Consultant: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile:(▇▇▇) ▇▇▇ ▇▇▇▇
With a copy to: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Reinhart, Boerner, Van Deuren ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Any party may designate by written notice to the other party any change in
address or facsimile number to which notices and other communications shall be
sent. All notices and other communications shall be deemed effective upon
receipt if delivered by facsimile or three (3) days after transmittal by
overnight courier.
4.6 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the state of Minnesota exclusive of the conflict of
laws provisions thereof.
4.7 Limitation on Consultant's Liability to Alltrista.
a. In no event shall Consultant be liable to Alltrista for lost
profits of Alltrista, or special, incidental or consequential damages (even
if Consultant has been advised of the possibility of such damages) except
with respect to fraud by Consultant, intentional misrepresentation by
Consultant or violation of any confidentiality provision herein contained
by Consultant.
b. Consultant's total liability under this Agreement for damages,
costs and expenses, regardless of cause (other than with respect to fraud
by Consultant , intentional misrepresentation by Consultant, or violation
of any confidentiality provision herein contained by Consultant), shall not
exceed the total amount of fees paid to Consultant by Alltrista under this
Agreement.
c. Consultant shall not be liable for any claim or demand made against
Alltrista by any third party other than with respect to fraud by
Consultant, intentional misrepresentation by Consultant, or a violation of
a confidentiality agreement by Consultant.
d. Alltrista shall indemnify Consultant and its owners, employees,
managers and governors against all claims, liabilities and costs, including
reasonable attorney fees incurred in defending any third party claim or
suit arising out of or in connection with this Agreement or in connection
with any acquisition. Consultant shall promptly notify Alltrista in writing
of such claim or suit and Alltrista shall have the right to fully control
the defense and any settlement of the claim or suit; provided, however,
that any settlement which would require any action or payment by
Consultant, or would require Consultant to undertake certain actions or to
refrain from acting, shall be subject to the written approval of
Consultant.
4.8 Dispute Resolution. The dispute resolution provisions set forth in
Article IX of the Asset Purchase Agreement as if set forth herein in full,
mutatis mutandis.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
ALLTRISTA CORPORATION
By
----------------------------------
Name:
Title:
------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (this "Agreement") is made and entered into as of
____________, 1999 by and between Alltrista Corporation, an Indiana corporation
("Alltrista") and [▇▇▇▇▇/▇▇▇▇▇ ▇▇▇▇] (this is the form of Consulting Agreement
to be entered into by each of ▇▇▇ and ▇▇▇▇▇ ▇▇▇▇. Each such Agreement shall
provide for an aggregate payment of $500,000) (the "Consultant").
BACKGROUND
A. Alltrista desires to and has offered to retain and engage the
Consultant, as an independent contractor, to make available to Alltrista, during
the term of this Agreement, the knowledge, experience and relationships of the
Consultant relating to the operation of the business formerly owned by Triangle
Plastics, Inc. as well as the acquisition of similar businesses, according to
the terms and conditions of this Agreement.
B. The Consultant is agreeable to such retention and engagement, according
to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
promises and covenants hereinafter set forth, the parties hereto agree as
follows:
SECTION I
CONSULTING AGREEMENT
1.1 Engagement of Consultant. Alltrista hereby retains and engages the
Consultant, and the Consultant hereby accepts such retention and engagement,
commencing as of the date hereof and continuing through termination in
accordance with Section 1.5 (the "Term"), to serve as, and in the capacity of,
an advisor and consultant with respect to the matters set forth in Section 1.2
hereof for the compensation hereinafter set forth.
1.2 Services of the Consultant. During the Term, the Consultant shall, on a
non-exclusive basis, undertake for and on behalf of, and to the extent
reasonably requested by Alltrista, to consult with and advise Alltrista with
respect to:
(i) the transition of the operation of the business formerly owned by
Triangle Plastics, Inc., such business having been purchased by Alltrista
as of the date hereof;
(ii) the acquisition of businesses similar to the business formerly owned
by Triangle Plastics, Inc., including advice regarding the selection of
businesses, the price to be paid, the structure of the acquisition and
post-acquisition operations;
[iii] [▇▇▇ ▇▇▇▇] attend industry meetings, conferences and events as
reasonably requested by Alltrista;
[iii] [▇▇▇▇▇ ▇▇▇▇] attend meetings, conferences and events of the Society
of Plastics Engineers;
[iv] [▇▇▇ ▇▇▇▇] participate in presentations to the investment community;
and
[v] [▇▇▇ ▇▇▇▇] review Alltrista's existing plastics operations and make
recommendations.
1.3 Compensation. In consideration for all of the Services to be rendered
during the Term by the Consultant hereunder, Alltrista agrees to pay the
Consultant:
1.3.1 Alltrista shall make payments to Consultant totaling $500,000.00 (the
"Consulting Fee"). Such payments shall be payable in eight equal installments of
$31,250.00 and shall be paid on the last day of every third calendar month
commencing on June 30, 1999 and ending with the final payment on March 31, 2001
("Final Payment Date").
1.3.2 Alltrista shall promptly reimburse Consultant for reasonable expenses
associated with the Services rendered hereunder, for attending industry meetings
and trade shows, and [for attending meetings of the Society of Plastics
Engineers] upon presentation of documentation of such expenses.
1.3.3 Consultant agrees that up to $250,000 of legal fees, costs and
expenses related to the Cadillac litigation referred to in Section 10.1(c) of
the Asset Purchase Agreement (the "Asset Purchase Agreement") dated as of
____________, 1999 among Alltrista, Triangle Plastics, Inc., TriEnda Corporation
and ▇▇▇▇▇ ▇. ▇▇▇▇ ("Cadillac Litigation Costs") may be offset against the
Consulting Fee due hereunder. Alltrista shall pay the Cadillac Litigation Costs
as incurred and shall provide evidence of the payment of such costs to
Consultant. If the Cadillac litigation is concluded before the Final Payment
Date, the difference between (i) $250,000 and (ii) one-half of the total
Cadillac Litigation Costs (not to exceed $250,000) shall be spread over the
remaining quarterly payments under Section 1.3.1. If the Cadillac litigation is
concluded after the Final Payment Date, the difference between (i) $250,000 and
(ii) one-half of the Cadillac Litigation Costs (not to exceed $250,000) shall be
promptly paid upon the conclusion of such litigation.
1.4 Time Commitment. The parties agree Consultant shall devote to his
activities hereunder an average of 10 hours per month during the first six (6)
months of the Term and thereafter five (5) hours per month for the remainder of
the Term to the activities hereunder.
1.5 Termination. The Term of this Agreement commences on the date hereof
and continues through March 31, 2001. Either party may terminate this Agreement
on 90 days notice; provided that if Alltrista terminates this Agreement or if
Consultant shall die or become permanently disabled, then Alltrista shall
continue to pay to Consultant (or his estate) the payments described in Section
1.3.1 and 1.3.3 for the remainder of the Term (or other applicable period
specified in Section 1.3.3) as if this Agreement had not been terminated or
Consultant had not died and become disabled. Sections 1.5, 3.1, 4.6, 4.7 and 4.8
shall survive termination.
SECTION II
RELATIONSHIP BETWEEN ALLTRISTA AND THE CONSULTANT
2.1 Independent Contractor. The Consultant is an independent contractor and
shall not be considered an employee, agent of, or joint venturer with, Alltrista
for any purpose whatsoever. The Consultant acknowledges and agrees that
Alltrista has no responsibility whatsoever (i) for the payment of any taxes,
including but not limited to duties, levies, assessments, income taxes, social
security taxes, payroll taxes, workers' compensation premiums, unemployment
insurance premiums or disability benefits which arise from the Consultant's
provision of the Services or (ii) for providing any employee benefits to the
Consultant. All such fees and taxes shall be paid by the Consultant.
2.2 Right to Contract with Others. Alltrista agrees Consultant shall be
free to provide services to others, provided, however, that Consultant shall not
provide such services if such services would violate the noncompetition
agreement between Alltrista and Consultant.
SECTION III
CONFIDENTIALITY
3.1 Confidential Information. Consultant hereby agrees that at all times he
shall maintain as confidential and hold in confidence all Confidential
Information as may be provided to Consultant by Alltrista. Consultant shall not
disclose publish or make use of Confidential Information without the prior
written consent of Alltrista unless such disclosure is required to be made by
law or Consultant obtains such information from an independent source. As used
in this Agreement, "Confidential Information" means any data or information of
or related to Alltrista's business which is valuable to Alltrista and not
generally known to competitors of Alltrista, including, without limitation,
general business information, industry information, analysis and other
information of a proprietary nature that relates to the business of Alltrista
(including any information relating to acquisitions Alltrista may undertake).
Confidential Information does not include any information which can be obtained
from a third party unaffiliated with Alltrista or which is otherwise in the
public domain.
SECTION IV GENERAL PROVISIONS
4.1 No Waiver. No waiver of any term or provision of this Agreement shall
be effective unless in writing signed by the party purporting to have waived
such term or provision. The failure of any of the parties to insist upon the
strict performance of any provision of this Agreement or to exercise any right,
power or remedy upon a breach thereof shall not constitute a waiver of that or
any other provision of this Agreement, or limit that party's right thereafter to
enforce any provision or exercise any right.
4.2 Headings. The section and other headings contained in this Agreement
are for reference purposes only and shall not be deemed to be a part of this
Agreement or to affect the meaning or interpretation of this Agreement.
4.3 Merger, Amendment, Counterparts . This Agreement, the Asset Purchase
Agreement and the related noncompetition agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof, and may
not be changed or modified except by an instrument in writing, signed by the
parties. This Agreement may be executed in one or more counterparts, all of
which taken together shall constitute one and the same instrument.
4.4 Successors and Assigns. This Agreement and the rights and obligations
hereunder shall be binding upon and inure to the benefit of, the parties hereto
and their legal representatives, successors, heirs, beneficiaries and permitted
assigns, as the case may be. This Agreement and all rights hereunder cannot be
assigned by the parties hereto; provided that Consultant may assign his rights
and delegate his duties hereunder to an LLC either solely owned by Consultant or
owned in whole by Consultant and [▇▇▇/▇▇▇▇▇ ▇▇▇▇]. Upon any such assignment
Consultant shall be deemed released from all of his obligations hereunder except
for those under Section 3.1.
4.5 Notices. Any notice or other communication required or permitted under
this Agreement shall be given in writing and shall be in the English language
and must be delivered by overnight courier or by facsimile. Notices shall be
addressed as follows:
If to the Alltrista: Alltrista Corporation
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile:
If to the Consultant:
Facsimile:
With a copy to: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇, Street and Deinard
Suite 2300
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Any party may designate by written notice to the other party any change in
address or facsimile number to which notices and other communications shall be
sent. All notices and other communications shall be deemed effective upon
receipt if delivered by facsimile or three (3) days after transmittal by
overnight courier.
4.6 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the state of Minnesota exclusive of the conflict of
laws provisions thereof.
4.7 Limitation on Consultant's Liability to Alltrista.
a. In no event shall Consultant be liable to Alltrista for lost
profits of Alltrista, or special, incidental or consequential damages (even
if Consultant has been advised of the possibility of such damages) except
with respect to fraud by Consultant, intentional misrepresentation by
Consultant or violation of any confidentiality provision herein contained
by Consultant.
b. Consultant's total liability under this Agreement for damages,
costs and expenses, regardless of cause (other than with respect to fraud
by Consultant, intentional misrepresentation by Consultant, or violation of
any confidentiality provision herein contained by Consultant), shall not
exceed the total amount of fees paid to Consultant by Alltrista under this
Agreement.
c. Consultant shall not be liable for any claim or demand made against
Alltrista by any third party other than with respect to fraud by
Consultant, intentional misrepresentation by Consultant, or a violation of
a confidentiality agreement by Consultant.
d. Alltrista shall indemnify Consultant and its owners, employees,
managers and governors against all claims, liabilities and costs, including
reasonable attorney fees incurred in defending any third party claim or
suit arising out of or in connection with this Agreement or in connection
with any acquisition. Consultant shall promptly notify Alltrista in writing
of such claim or suit and Alltrista shall have the right to fully control
the defense and any settlement of the claim or suit; provided, however,
that any settlement which would require any action or payment by Consultant
shall be subject to the written approval of Consultant.
4.8 Dispute Resolution. The dispute resolution provisions set forth in
Article IX of the Asset Purchase Agreement as if set forth herein in full,
mutatis mutandis.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
ALLTRISTA CORPORATION
By
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Name:
Title:
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[▇▇▇▇▇ / ▇▇▇▇▇ ▇▇▇▇]
Exhibit 8.4(g)
ASSIGNMENT AND ASSUMPTION AGREEMENT
ASSIGNMENT AND ASSUMPTION AGREEMENT (this "Agreement") is made and entered
into as of March ____, 1999 between Triangle Plastics, Inc., an Iowa corporation
("Seller"), TriEnda Corporation, a Wisconsin corporation ("Subsidiary") and
Alltrista Corporation, an Indiana corporation ("Buyer").
BACKGROUND
A. Seller, Subsidiary, Buyer and ▇▇▇▇▇ ▇. ▇▇▇▇ are parties to that certain
Asset Purchase Agreement dated as of March ___, 1999 (the "Purchase Agreement")
pursuant to which Seller and Subsidiary agreed to sell to Buyer, and Buyer
agreed to purchase from Seller and Subsidiary, substantially all of the Assets
of Seller and Subsidiary. Capitalized terms used but not defined herein have the
meanings set forth in the Purchase Agreement.
B. The Assets sold by Seller and Subsidiary and purchased by Buyer pursuant
to the Purchase Agreement include all of Seller's and Subsidiary's rights under
the Contracts.
C. Pursuant to the terms of the Purchase Agreement, Buyer must perform the
Assumed Liabilities.
D. Each of Seller and Subsidiary desire to transfer its interest in the
Contracts and Buyer desires to accept such transfer, and perform the Assumed
Liabilities according to the terms and conditions of this Agreement.
AGREEMENT
NOW, THEREFORE, the parties mutually agree as follows:
1. Assignment by Seller. Each of Seller and Subsidiary hereby assigns and
transfers all of Seller's right, title and interest in the Contracts to Buyer.
2. Assumption by Buyer. Buyer hereby accepts such assignment and transfer
from Seller and Subsidiary and Buyer hereby assumes all of the Assumed
Liabilities, and will promptly pay, perform and discharge all of the covenants
and obligations of all of the Assumed Liabilities, including all of the
covenants, agreements and obligations contained in the Contracts and
Commitments.
3. Successors and Assigns. The obligations assumed hereby shall be binding
upon Buyer's successors and assigns.
4. Counterparts. This Agreement may be executed and delivered in two or
more counterparts, each of which, when so executed and delivered, shall
constitute an original, but such counterparts shall constitute one and the same
instrument. Signatures delivered by facsimile shall be binding to the same
extent as an original.
5. Governing Law. This Agreement shall be construed in accordance with the
laws of the State of Minnesota, excluding the conflict of laws provisions
thereof. The dispute resolution and arbitration provisions set forth in Article
IX of the Purchase Agreement apply to this Agreement.
[Remainder of page is blank.]
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
BUYER: SELLER:
ALLTRISTA CORPORATION TRIANGLE PLASTICS, INC.
By By
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Name:
President and Chief
Executive Officer
SUBSIDIARY:
TRIENDA CORPORATION
By:
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Name: