ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (the "Agreement") is entered into as of November
28, 2001 by and among Plexus Corp., a Wisconsin corporation (the "Buyer"), MCMS,
Inc., a Delaware corporation ("MCMS"), MCMS Customer Services, Inc., an Idaho
corporation ("MCMS Customer Services"), MCMS International, Inc., a British
Virgin Islands corporation ("MCMS International"), MCMS Electronics (Xiamen)
Co., Ltd. a China corporation ("MCMS China"), and M.C.M.S. Sdn. Bhd., a Malaysia
corporation ("MCMS Malaysia"). MCMS and MCMS Customer Services are referred to
collectively herein as the "Sellers." MCMS International, MCMS China and MCMS
Malaysia are referred to collectively as the "Foreign Entities." The Buyer, the
Sellers and the Foreign Entities are referred to collectively herein as the
"Parties."
W I T N E S S E T H:
WHEREAS, on or about September 18, 2001 (the "Filing Date"), the Sellers and
MCMS Holdings, LLC, an Idaho limited liability company ("MCMS Holdings", and,
together with the Sellers, collectively, the "U.S. Entities") each filed a
voluntary petition for relief under Chapter 11 of Title 11 of the United States
Bankruptcy Code (the "Bankruptcy Code") in the United States Bankruptcy Court
for the District of Delaware (the "Bankruptcy Court") (the "Bankruptcy Case(s)"
or "Chapter 11 Cases(s)", as appropriate);
WHEREAS, the U.S. Entities intend to seek an order of the Bankruptcy Court
approving this Agreement and authorizing the Sellers to consummate the
transactions contemplated hereby;
WHEREAS, subject to approval of the Bankruptcy Court, the Sellers desire to
sell, transfer and assign to the Buyer and the Buyer desires to purchase and
acquire from the Sellers all of the Sellers' assets (other than certain excluded
assets) free and clear of all liens, claims, encumbrances, liabilities and other
obligations and interests, and, in connection with such purchase and
acquisition, the Buyer desires to assume certain obligations and liabilities of
the Sellers, all in accordance with the terms and condition set forth herein;
and
WHEREAS, certain capitalized terms used herein have the meanings set forth in
Article X of this Agreement.
NOW, THEREFORE, in consideration of the mutual representations, warranties,
covenants and undertakings herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged and
with the intent to be bound, the Parties agree as follows.
ARTICLE I
THE PURCHASE
1.1 Purchase and Sale of Acquired Assets.
(a) Upon and subject to the terms and conditions of this
Agreement, the Buyer shall purchase from the Sellers, and the Sellers shall
sell, transfer, convey, assign and deliver to the Buyer as a good faith
purchaser for value within the meaning of Section 363(m) of the Bankruptcy Code
and free and clear of all liens, claims, encumbrances and interests, at the
Closing, for the aggregate consideration specified below in this Article I, all
of the Sellers' right, title and interest in and to all of the tangible and
intangible assets of the Sellers (other than the Excluded Assets) existing as of
the Closing regardless of whether such assets existed prior to the commencement
of Sellers' Chapter 11 Cases or arose thereafter (collectively, the "Acquired
Assets", it being acknowledged and agreed that the Buyer shall have the right in
its sole discretion from time to time prior to the Closing to identify and
designate any of such Acquired Assets as Excluded Assets), including, without
limitation:
(i) (A) all inventory, raw materials, work in
process, supplies, parts, packaging materials, and accessories of the Sellers
and the Subsidiaries (the "Inventory") to the extent such Inventory is Quality
Inventory; and
(B) Inventory, other than Quality Inventory or
Obsolete Inventory, to the extent such Inventory relates to a customer that
prior to the Closing (1) has not notified any of the Parties of its intention to
disengage as a customer of the Sellers (or the Buyer after the Closing) and (2)
has supplied a forecast demonstrating demand for products after the Closing
(other than for repairs), which shall exclude any Inventory relating to Cisco
Systems, Inc. and any affiliates thereof (collectively, "Cisco" and such
Inventory, the "Cisco Inventory"), Nokia Corp. and any affiliates thereof
(collectively, "Nokia" and such Inventory, the "Nokia Inventory") or AT&T
Wireless Services, Inc. and any affiliates thereof (collectively, "ATT" and such
Inventory the "ATT Inventory") and (3) the value of which does not exceed five
million dollars ($5,000,000) in the aggregate, which value shall be calculated
at the acquisition cost of such Inventory by the Sellers or the Subsidiaries, as
applicable (such Inventory actually acquired by the Buyer being the "Non-Quality
Inventory");
(ii) all personal property and interests, including
but not limited to machinery, equipment, tooling, dies, jigs, spare parts and
supplies (including expendable tooling), furniture, fixtures, leasehold
improvements, motor vehicles and those items set forth on the fixed asset
property listing provided by Sellers to the Buyer which is set forth as Schedule
1.1(a)(ii) hereto;
(iii) all (A) patents, patent applications, patent
disclosures, all related continuation, continuation-in-part, divisional,
reissue, re-examination, utility model, certificate of invention and design
patents, patent applications, registrations and applications for registrations
and other industrial property rights acquired or available under the laws of any
jurisdiction, (B) trademarks, service marks, trade dress, logos, tradenames and
corporate names and registrations and applications for registration thereof
together with related goodwill, (C) copyrights and registrations and
applications for registration thereof, (D) mask works and registrations and
applications for registration thereof, (E) computer software, (including without
limitation, source code, object code, interpreted code, Java byte code,
firmware, middleware, programs, utilities, languages, subroutines or routines),
data, databases, compilations, documentation, data processing systems, networks
and network systems, website and other Internet and webcentric systems and
properties, domain names, content contained on any Internet
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or intranet site, and descriptions, flowcharts and other work product used to
design, plan, organize and develop any of the foregoing, (F) trade secrets and
confidential business information, whether patentable or unpatentable and
whether or not reduced to practice, know-how, manufacturing and product
processes and techniques, research and development information, copyrightable
works, financial, marketing and business data, pricing and cost information,
business and marketing plans and customer and supplier lists and information,
including, without limitation, all membership lists and databases and related
information and profiles (which include all website and other content whether
published by the members or otherwise), and internet domain names (G) other
proprietary rights relating to any of the foregoing (including, without
limitation, remedies against infringements thereof and rights of protection of
interest therein under the laws of all jurisdictions), and (H) copies and
tangible embodiments thereof (collectively, "Intellectual Property"), subject to
the limitations on the transferability of certain patent licenses under the
Bankruptcy Code. Included within the definition of "Intellectual Property" are
the items set forth in the listing on Schedule 1.1(a)(iii) (the "Intellectual
Property Listing");
(iv) all rights under all executory contracts and
unexpired leases, including leaseholds and subleaseholds in real property (and
easements, rights-of-way and other appurtenants thereto) of the Sellers (the
"Leased Real Property"), that are listed on Schedule 1.1(a)(iv)(A) hereto, as
such schedule hereafter may be supplemented or otherwise modified by the Buyer
at or prior to the Closing pursuant to Section 4.4(c) and all contract rights
therein, except for such contracts that are no longer in effect in accordance
with their terms and such contracts that are listed on Schedule 1.1(a)(iv)(B)
hereto (collectively, the "Assigned Contracts and Leases");
(v) all real property (and easements, rights-of-way,
private electric supply agreements and other appurtenants or rights thereto or
in connection therewith) owned by the Sellers or any Subsidiary, including but
not limited to the property set forth on Schedule 1.1(a)(v) hereto (the "Owned
Real Property");
(vi) (A) all rights, claims, and causes of action
against Buyer or any subsidiary thereof, except for such rights and causes of
action of the Sellers relating to this Agreement, the Ancillary Agreements or
the transaction contemplated hereby or thereby, (B) all avoidance claims or
comparable non-bankruptcy fraudulent transfer causes of action against any party
with which the Buyer has (or may have as a result of the transactions
contemplated by this Agreement) a business relationship (including but not
limited to under ss.ss.544, 547, 548 or 549 of the Bankruptcy Code) other than
any such claims or causes of action (i) referenced in Section 1.1(b)(ix) as
Excluded Assets or (ii) that relate to Excluded Assets and (C) all claims and
causes of action against any third party relating to any Intellectual Property
including, without limitation, rights under confidentiality or assignment of
invention agreements and any such claims for past, present or future
infringement;
(vii) other than those solely related to the Belgian
Entities or the Mexican Entities, all permits, licenses, registrations,
certificates, orders, approvals, franchises, variances and similar rights issued
by or obtained from any governmental, regulatory or administrative authority or
agency, court or arbitrational tribunal (a "Governmental Entity"),
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including, without limitation, those relating to the Leased Real Property and
the Owned Real Property (collectively, "Permits"), to the extent such Permits
are transferable;
(viii) except as excluded in Section 1.1(b)(viii)
below, all books, records, files, documents, correspondence, lists, engineering
drawings or specifications, product testing procedures and test results,
manufacturing and procedural manuals, advertising and promotional materials,
studies, reports and other printed or written materials in whatever format
relating to the items of Acquired Assets listed in clauses (i) through (vii)
above or in clauses (ix) and (x) below, including, without limitation, any and
all books, records or other documentation relating to any and all undertakings,
testing or compliance (or lack thereof) with ISO certifications with respect to
the Acquired Assets and any and all original (or if the original cannot be
located, then a copy thereof) files, applications, assignments and other
documentation relating to the prosecution and/or maintenance of any Intellectual
Property, provided that to the extent any of the foregoing are necessary for the
Buyer to get the benefit of any Acquired Asset or Assigned Contracts and Leases,
the Acquired Assets shall include any and all originals and copies thereof;
(ix) the accounts receivable of the Sellers,
excluding any accounts receivable relating to Cisco, Nokia or ATT (collectively,
the "Cisco/Nokia/ATT Accounts Receivable") and excluding any Foreign Entity
Inter-Company Payables (as defined in Section 1.4(b)(iv)), that are valid
receivables arising out of the sales of inventory or services not earlier than
45 days prior to the Closing and in the ordinary course of business subject to
no setoffs or counterclaims (other than the Assumed Payables), subject to the
limitations set forth in Section 1.6(b)(iii) and subject to the proviso on
Schedule 1.1(a)(ix) (as so determined, the "Included Receivables");
(x) the prepaid expenses and other current assets of
the Sellers of the type described in Schedule 1.1(a)(x) attached hereto relating
to the Acquired Assets (the "Included Current Assets");
(xi) any and all capital stock or other ownership
interests of the Sellers in MCMS International and, thereby, indirectly MCMS
China and MCMS Malaysia (for the avoidance of doubt, the Buyer is not directly
purchasing the stock of MCMS Malaysia or MCMS China); and
(xii) all of the Sellers' rights in, to and under all
nondisclosure and confidentiality agreements between the Sellers (or any
affiliates) and any employees of the Sellers (or any affiliates).
(b) Notwithstanding the provisions of Section 1.1(a), the
Acquired Assets shall not include the following assets (collectively, the
"Excluded Assets"):
(i) the corporate charter, qualifications to conduct
business as a foreign corporation, arrangements with registered agents relating
to foreign qualifications, taxpayer and other identification numbers, seals,
minute books, stock transfer books and other documents relating to the
organization and existence of the Sellers;
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(ii) any of the rights of the Sellers under this
Agreement or the Ancillary Agreements (for purposes of this Agreement,
"Ancillary Agreements" shall mean the Escrow Agreement, ▇▇▇▇ of sale, assignment
agreements and other instruments of conveyance referred to in Section 1.5(b)(v),
and the instrument of assumption and other instruments referred to in Section
1.5(b)(vi));
(iii) any rights of the Sellers under any order of
the Bankruptcy Court relating to this Agreement, the Ancillary Agreements or the
transactions contemplated hereby and thereby;
(iv) (A) all cash, cash equivalents of the Sellers or
similar type investments, uncollected checks, marketable securities,
investments, deposits, bank accounts of the Sellers, and (B) all trade and other
accounts receivable, notes receivable and any other right to receive payment of
the Sellers from any other party to the extent that it arises from the sale of
goods or the provision of services earned prior to the Closing except for the
Included Receivables (the "Retained Receivables");
(v) any and all capital stock or other ownership
interests owned by the Sellers in any direct Subsidiary thereof (other than the
ownership interests of MCMS in MCMS International), including without
limitation, the Belgian Entities and, reflecting the transactions contemplated
by Section 5.1(o) of this Agreement, the Mexican Entities;
(vi) all of the Sellers' right, title and interest
in, to and under the assets, properties and business, of every kind and
description, real, personal or mixed, tangible or intangible, and owned, held or
used solely in the conduct of the business of MCMS Netherlands, B.V., MCMS
Holdings, LLC and MCMS Belgium, SPRL (the "Belgian Entities") and/or in the
conduct of the business of MCMS Asia Pacific Pte Ltd., MCMS Singapore Pte Ltd.
and MCMS de Mexico, S de RL de CV (the "Mexican Entities"), except, with respect
to the Mexican Entities, such inventory and receivables to be transferred to
Buyer as provided in Schedule 1.1(a)(ix);
(vii) all rights under all executory contracts and
unexpired leases that are listed on Schedule 1.1(a)(iv)(B) and that are not
listed on Schedule 1.1(a)(iv)(A) attached hereto, as such Schedule 1.1(a)(iv)(A)
hereafter may be supplemented or otherwise modified by the Buyer in its sole
discretion at or prior to the Closing (it being understood that no contracts or
leases listed on Schedule 1.1(a)(iv)(B) shall become part of Schedule
1.1(a)(iv)(A);
(viii) (A) all originals and copies of all books,
records, files, papers, whether in hard copy or computer format, prepared in
connection with this Agreement or the transactions contemplated hereby and (B)
the items set forth in Section 1.1(a)(viii) above to the extent they relate
solely to the Excluded Assets, the Retained Liabilities or the Retained
Receivables, or, except in the case of Intellectual Property files with respect
to non-infringement opinions, are the subject of attorney-client privilege
between the Sellers and their attorneys (the Sellers specifically reserving and
not waiving any and all such attorney-client privileges, and the Sellers
reserving the right to retain a copy of any other items set forth in Section 1.1
(a)(viii) above to the extent they relate, but do not relate solely, to the
Excluded Assets or the Retained Liabilities); and
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(ix) all rights, claims, causes of action and
interests of MCMS in and to the litigations set forth on Schedule 1.1(b)(ix)
attached hereto and all rights, claims and causes of action arising under
contracts and agreements under which any of such litigation arose;
(x) all rights demands, actions and causes of action
that the Sellers may have against any third party that are not specifically
identified as Acquired Assets;
(xi) all of the Sellers' rights in and to any of the
Sellers' tax assets (including, without limitation, all refunds, credits or
claims for refunds or credits relating to the payment of taxes attributable to
any period ending on or before the Closing Date or any period beginning before
the Closing Date and ending after the Closing Date, but only with respect to
that period up to and including the Closing Date);
(xii) any records (including accounting records)
related to taxes paid or payable by the Sellers and all financial and tax
records relating to the business conducted by the Sellers that form part of the
Sellers' general ledger;
(xiii) any insurance policy, insurance claims and
proceeds not relating to the Acquired Assets;
(xiv) prepaid assets, including prepayments on
insurance and maintenance agreements, not relating to the Acquired Assets;
(xv) Inventory (including the Cisco Inventory, the
Nokia Inventory, the ATT Inventory and the Obsolete Inventory) that is not
Quality Inventory or Non-Quality Inventory;
(xvi) all assets specifically described in Section
1.1(a) as being assets that are not Acquired Assets;
(xvii) all credits of the Sellers with suppliers; and
(xviii) the other assets specifically set forth on
Schedule 1.1(b)(xviii) attached hereto.
1.2 Assumption of Liabilities.
(a) Upon and subject to the terms and conditions of this
Agreement (including but not limited to the Sellers' satisfaction of its
assumption and assignment obligations with respect to the Assigned Contracts and
Leases pursuant to Section 4.4(c) and the condition set forth in Section
5.1(b)), the Buyer shall assume and become responsible for, from and after the
Closing (collectively, the "Assumed Liabilities"):
(i) all obligations of the Sellers arising from and
after the Closing under the Assigned Contracts and Leases; provided, however,
that with respect to the liability of Buyer for warranties on parts and labor,
Buyer shall assume the unexpired portion of such liability on goods sold prior
to the Closing Date by Sellers to customers who are continuing customers of the
Buyer (the "Assumed Warranty Obligations");
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(ii) all accepted orders from customers of the
Sellers (excluding orders relating to the Belgian Entities, the Mexican
Entities, Cisco, Nokia or ATT) and all the purchase orders of the Sellers
(excluding orders relating to the Belgian Entities, the Mexican Entities, Cisco,
Nokia and ATT) issued in the ordinary course of business;
(iii) the customer accounts payable of the Sellers
(other than to any affiliates thereof) solely relating to customers that will be
continuing customers of the Buyer (the "Assumed Payables");
(iv) liabilities arising after the Closing out of the
ownership and operation of the Acquired Assets after the Closing, including,
without limitation, liability for personal injury of customers or employees;
(v) liabilities related to the termination of
employment after the Closing of any Continuing Employee, including, but not
limited to any liability arising under the WARN Act;
(vi) liabilities related to earned but unpaid salary,
payroll and related taxes and accrued but unpaid vacation and sick days
(collectively, the "Accrued Employee Liabilities"), of active employees of the
Sellers employed by the Buyer ("Continuing Employees") and, whether or not
accrued, any obligations under Section 4980B of the Internal Revenue Code to
provide continuation of group medical coverage with respect to any Continuing
Employee or other qualified beneficiary of any such Continuing Employee that
occur after the Closing;
(vii) the liabilities and obligations to make certain
specified payments in respect of the Retention Plan, the MCMS Plan and the
Executive Employment Agreements up to the maximum aggregate amount of
$3,700,000, subject to the terms of Section 1.4(c)(ii) and Section 1.8 hereof
(the Assumed Liabilities described in clauses (v) through this clause (vii)
collectively, the "Assumed Employee Liabilities");
(viii) all liabilities and obligations relating to
the Continuing Employees arising after the Closing Date as set forth in the
Buyer's Plans; and
(ix) all liabilities and obligations for taxes that
the Buyer is liable for pursuant to Section 6.6(b).
(b) The Buyer shall not assume or otherwise become responsible
for, and the Sellers shall remain liable for, any and all liabilities or
obligations (including but not limited to "claims" as defined under ss.101(5) of
the Bankruptcy Code) of the Sellers which are not Assumed Liabilities (whether
known or unknown, whether absolute or contingent, whether liquidated or
unliquidated, whether due or to become due, and whether claims with respect
thereto are asserted before or after the Closing) (collectively, the "Retained
Liabilities"). The Sellers agree that the Retained Liabilities shall constitute
claims and alleged claims in the Sellers' Bankruptcy Cases; provided, however,
that nothing herein shall grant or create any rights in favor of the holders of
Retained Liabilities or create any priority to right of payment. It is expressly
understood and agreed that the Parties intend that the Buyer shall not be
considered to be a successor to the Sellers by reason of any theory of law or
equity and that the Buyer shall
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have no liability except as expressly provided in this Agreement for any
liability of the Sellers. The Retained Liabilities shall include, without
limitation, the following (for purposes of the following clauses, the term
"Sellers" shall include the Sellers and each of its direct and indirect
subsidiaries):
(i) all liabilities and obligations of the Sellers
for any federal, state, foreign local or other taxes other than any liabilities
and obligations for taxes that the Buyer is liable for pursuant to Section
6.6(b);
(ii) all liabilities and obligations of the Sellers
for costs and expenses incurred by the Sellers in connection with this Agreement
or the consummation of the transactions contemplated by this Agreement;
(iii) all liabilities and obligations of the Sellers
under this Agreement or the Ancillary Agreements, or under the Prior Agreement;
(iv) all liabilities and obligations of the Sellers
under any agreements, contracts, leases or licenses which are not Assumed
Liabilities;
(v) all liabilities and obligations of the Sellers
relating to the design, manufacture, sale or distribution of products or the
provision of services, including, without limitation, claims for infringement,
product liability, customer support claims, or claims for repair, replacement or
return of products manufactured or sold or distributed by the Sellers prior to
the Closing (but excluding any of the foregoing liabilities or obligations
arising from the sale by the Buyer after the Closing of Acquired Assets
consisting of products produced by the Sellers, and excluding the Assumed
Warranty Obligations);
(vi) all liabilities and obligations of the Sellers
arising out of events, conduct or conditions to the extent existing or occurring
prior to the Closing that constitute a violation of or non-compliance with any
law, rule or regulation, any judgment, decree or order of any Governmental
Entity, or any Permit;
(vii) all liabilities and obligations of the Sellers
related directly or indirectly to the environmental condition (and any adverse
consequences arising therefrom) or operation of the facilities located on the
Owned Real Property or pursuant to the Leases (the "Facilities") under
applicable Environmental Laws, equipment and properties owned, leased or
operated by the Sellers (including but not limited to on- and off-site
liabilities and liabilities associated with the transportation or migration of
hazardous substances or environmental contaminants to an offsite location) or
arising out of events, conduct or conditions occurring prior to the Closing,
regardless of whether such condition or operation constitutes a violation of, or
non-compliance with, any Environmental Laws; provided, however, that to the
extent that the amount of any such liabilities or obligations with respect to
the environmental condition or operations of the Facilities which is known to
the Buyer is increased as a result of the Buyer's operations of the Facilities
occurring after the Closing, such increased amount of such liabilities or
obligations shall not be a Retained Liability;
(viii) except for the Assumed Employee Liabilities,
(A) all liabilities and obligations of the Sellers to pay any wages,
compensation, bonus, incentives, accrued salary,
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accrued vacation, sick pay or severance benefits, or unemployment compensation,
employee welfare or pension benefits, in each case to any current or former
employee, agent, consultant, advisor or independent contractor of the Sellers,
(B) all liabilities and obligations resulting from the termination of employment
of employees of the Sellers that arose under any federal, state, local or
foreign law or regulation or under any employee benefit plan established or
maintained by the Sellers and (C) all liabilities and obligations of the Sellers
with respect to any stock option plans or other equity benefit programs;
(ix) all liabilities and obligations of the Sellers
for injury to or death of persons or damage to or destruction of property
arising out of events, conduct or conditions to the extent occurring prior to
the Closing (except for obligations with respect to parts and labor as part of
Assumed Warranty Obligations);
(x) all liabilities and obligations of the Sellers
for medical, dental and disability (both long-term and short-term) benefits,
whether insured or self-insured, owed to employees or former employees of the
Sellers;
(xi) all liabilities and obligations of the Sellers
and each ERISA affiliate arising out of or with respect to any "multiemployer
plan" (as defined in Section 3(37) of ERISA) or other employee benefit plan,
including but not limited to any Section 401(k) benefits or matching
contribution obligations;
(xii) all liabilities and obligations of the Sellers
arising out of any claim, suit, action, arbitration, proceeding, investigation
or other similar matter which commenced prior to the Closing or relates to the
ownership of the Acquired Assets or the operation of the business of the Sellers
on or prior to the Closing;
(xiii) except for Assumed Liabilities, all
liabilities and obligations of the Sellers for any claims and administrative or
other expenses of whatever kind or nature, arising prior or subsequent to the
commencement of the Bankruptcy Case, whether or not asserted;
(xiv) all liabilities and obligations of the Sellers,
or any of their officers, directors or employees (in such capacities) to any
person or entity as a shareholder of the Sellers, including, without limitation,
in connection with any pending, threatened or future shareholder lawsuit; and
(xv) all liabilities and obligations of the Sellers
for trade debt (except for the Assumed Payables), borrowed money or other
indebtedness, including, without limitation, in connection with all notes, bonds
or other instruments or documents issued by the Sellers.
1.3 Purchase Price; Deposit.
(a) The aggregate transaction consideration to be paid by the
Buyer to the Sellers in respect of the Acquired Assets shall consist of (i) the
Purchase Price (as defined below), which shall be paid in cash as provided in
this Article I and (ii) the Buyer's assumption of the Assumed Liabilities. The
"Purchase Price" shall be equal to the Preliminary Purchase Price, as adjusted
in accordance with Sections 1.4, 1.6 and 1.6A. The Parties have agreed that the
Preliminary
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Purchase Price shall equal Forty-Five Million Dollars ($45,000,000) less (i) an
amount, up to $600,000, determined in accordance with Schedule 1.3A on the date
that is one day prior to the Closing Date, less (ii) $200,000 which represents
the amount of warranty reserves credited to Buyer for the Assumed Warranty
Obligations, less (iii) an amount equal to the aggregate sum of the value of any
material equipment that is the subject of any of the Assigned Contracts and
Leases (including, without limitation, any debt or lease financing) and which
cannot be located and provided to the Buyer at Closing, as reasonably determined
by the Buyer and the Sellers on the date that is one day prior to the Closing
Date, less (iv) the costs of the Foreign Entities Audit, up to the maximum
amount of $100,000, but only to the extent that the Sellers have not paid for
the costs of the Foreign Entities Audit prior to the Closing, less (v) an amount
determined in accordance with Schedule 1.3B. For the purposes of clause (iii) of
the preceding sentence, the "value" of such equipment that cannot be located
shall equal, with respect to owned equipment, the then current replacement cost
of such equipment or, with respect to leased equipment, the cost to replace such
leased equipment in accordance with the terms of the applicable lease.
(b) The Buyer has delivered to an escrow agent pursuant to the
Bidding Order $2,000,000 in cash by wire transfer of immediately available funds
(the "Deposit"), which Deposit shall be held by the Escrow Agent as an ▇▇▇▇▇▇▇
money deposit in accordance with an escrow agreement, in form and substance
reasonably satisfactory to the Parties, among the Sellers, the Buyer and the
Escrow Agent. The Deposit shall be (i) retained by the Sellers pursuant to
Section 1.5(b)(iii) if the Closing takes place or, in accordance with Section
7.2, if this Agreement is terminated by the Sellers pursuant to Section 7.1(b)
hereto, or (ii) returned to the Buyer in accordance with Section 7.2 if this
Agreement is terminated by the Sellers or the Buyer for any reason other than by
the Sellers pursuant to Section 7.1(b).
1.4 Estimated Purchase Price Adjustments; Escrow Amount.
(a) No later than five (5) business days (but in no event
earlier than ten (10) business days) prior to the Closing, the Buyer and the
Sellers shall in good faith jointly prepare, based on the books and records of
the Sellers and their Subsidiaries and, where applicable, with respect to all
United States assets and operations, in accordance with U.S. GAAP applied on a
consistent basis with the Financial Statements and the balance sheets of the
Foreign Entities, a certificate (the "Estimated Amounts Certificate") setting
forth in reasonable detail the calculations as of the date of such certificate
of the following: (i) the total amount of Accrued Employee Liabilities; (ii) the
total amount of the Assumed Payables; (iii) the total amount of Included Current
Assets; (iv) the total amount of the Foreign Entities Net Current Assets; (v)
the total amount of Included Receivables; (vi) the total amount of Quality
Inventory (as defined below); and (vii) the total amount of the Non-Quality
Inventory. For purposes of calculating the Estimated Amounts Certificate, all
references to the "Closing Date" in the definitions of capitalized terms used in
the preceding sentence shall mean the date of the Estimated Amounts Certificate.
(b) The "Estimated Purchase Price Adjustment" shall be an
amount equal to the sum of:
(i) seven hundred fifty thousand dollars ($750,000);
plus
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(ii) (A) twenty million dollars ($20,000,000) (the
"Net Working Capital Target"); minus
(B) the sum of the following (each of which
shall, subject to subsection (v) below, be as set forth on the Estimated Amounts
Certificate):
(1) the Included Receivables; plus
(2) the Quality Inventory (as defined
below); plus
(3) twenty percent (20%) of the total value
of the Non-Quality Inventory; plus
(4) the Included Current Assets; plus
(5) the Foreign Entities Net Current Assets,
minus
(6) the Accrued Employee Liabilities; minus
(7) the Assumed Payables; minus
(8) the Cancellation Fees.
(iii) For purposes hereof, "Quality Inventory" shall
mean Inventory (excluding the Cisco Inventory, the Nokia Inventory and the ATT
Inventory and Inventory held at or for use in the Belgian Entities or the
Mexican Entities, except as further provided in Schedule 1.1(a)(ix)), valued at
the Sellers' or the Subsidiaries', as applicable, (A) the Imputed Inventory
Value with respect to raw materials, (B) the Imputed Inventory Value for the raw
material portion, plus 50% of the transformation costs, with respect to Work in
Process or (C) the Imputed Inventory Value for the raw material portion, plus
100% of the transformation costs, with respect to finished goods if and to the
extent such Inventory meets the appropriate following criterion:
(1) as to raw material, it is to be used in
product (x) to be manufactured or
shipped pursuant to valid customer
purchase orders or orders placed under
Assigned Contracts and Leases placed
prior to the Closing with the Sellers or
Foreign Entities, or (y) to be
manufactured and shipped within 180 days
of the Closing based upon demand
forecasts supplied prior to the Closing
by customers that are party to contracts
that are Assigned Contracts and Leases
or otherwise have previously established
an ongoing customer relationship with
the Sellers or Foreign Entities;
(2) as to Work in Process or finished goods,
it was produced pursuant to
manufacturing orders dated (i.e., the
transformation from raw materials began)
not more than 60 days prior to the
Closing;
all as calculated in accordance with the methodology currently used by the
Sellers and as determined by the Buyer in its sole but reasonable discretion. In
exercising its discretion and making such determination, the Buyer shall discuss
with customers supplying such demand forecasts the basis for such forecasts and
shall take into account the accuracy of prior forecasts provided by such
customers as compared to products actually shipped.
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(iv) For purposes hereof, the term "Foreign Entity
Net Current Assets" shall mean the difference between (A) the sum of cash and
cash equivalents, trade accounts receivable, prepaid expenses and other current
assets of the Foreign Entities and (B) the sum of the accrued expenses, deferred
revenue, trade payables and taxes (direct or indirect) due, of the Foreign
Entities; provided that the amount of any accounts receivable owed by the
Sellers or any Belgian Entity or any Mexican Entity to any Foreign Entity (the
"Foreign Entity Inter-Company Receivables") and the amount of any accounts
payable owed by any Foreign Entity to the Sellers, any Belgian Entity or any
Mexican Entity (the "Foreign Entity Inter-Company Payables") shall be
disregarded for purposes of calculating the Foreign Entities Net Current Assets.
(v) In the event that the amount of the Quality
Inventory as set forth on the Estimated Closing Amounts Certificate is greater
than twenty million dollars ($20,000,000), then any amounts in excess of twenty
million dollars ($20,000,000) shall be excluded from the amount of Quality
Inventory for purposes of Section 1.4(b)(ii)(B)(2) above, such exclusion not to
exceed five million dollars ($5,000,000).
(vi) For purposes hereof, "Work in Process" shall
mean items as to which substantial transformation has begun pursuant to customer
order, and shall not include items located in a facility as to which assembly
processes have not yet begun.
(vii) For purposes hereof, "Cancellation Fees" shall
mean any fees, penalties or other charges arising under Assigned Contracts and
Leases payable as a result of cancellation prior to the Closing Date of an order
for any raw materials or other items of inventory which have not yet been
delivered to the Sellers to the extent such items would not be considered
"Quality Inventory" if in the possession of the Sellers, but excluding (A) any
such amounts included in Assumed Payables; or (B) any such amounts to the extent
reflected in the calculation of Foreign Entity Net Current Assets.
(c) The "Escrow Amount" shall be an amount equal to the sum
of:
(i) the Estimated Purchase Price Adjustment (to the
extent the same is a positive number);
(ii) $3,000,000 (which shall be applied by the Buyer
to fund the obligations under the Retention Plan, the MCMS Plan and the
Executive Employment Agreements as described in Section 1.8 hereof), provided,
however, that in the event that the Sellers fail to pay any portion of the
Retention Plan Payment in accordance with Section 1.8 hereof, such amount shall
be increased (up to the maximum amount of $3,700,000) by an amount equal to the
portion of the Retention Plan Payment not so paid by the Sellers (as so
increased, the "Plan Escrow Amount");
(iii) $2,000,000 (which shall be applied by the Buyer
to fund the indemnity obligations of the Sellers pursuant to Article VIII
hereof) (the "Indemnity Escrow Amount"); and
(iv) an amount equal to 15% of the value of the
Quality Inventory as set forth on the Estimated Amounts Certificate (which shall
be applied by the Buyer to fund the
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Inventory Adjustment Amount, as provided in Section 1.6A of this Agreement (the
"Inventory Escrow Amount")).
1.5 The Closing.
(a) The closing of the transactions contemplated by this
Agreement (the "Closing") shall take place at the offices of ▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP
in Milwaukee, Wisconsin, or such other location as may be mutually agreed upon
by the Parties, commencing at 9:00 a.m. Central Time on the first business day
following the satisfaction or waiver of all conditions to the obligations of the
Parties to consummate the transactions contemplated hereby, or on such other day
as may be mutually agreed by the Parties (the "Closing Date"). The parties shall
use their reasonable best efforts to cause January 8, 2002 to be the Closing
Date.
(b) At the Closing:
(i) the Sellers shall deliver to the Buyer the
various certificates, instruments and documents referred to in Section 5.1, as
well as such other certificates, instruments and documents as the Buyer may
reasonably request;
(ii) the Buyer shall deliver to the Sellers the
various certificates, instruments and documents referred to in Section 5.2, as
well as such other certificates, instruments and documents as the Sellers may
reasonably request;
(iii) the Sellers shall deliver by wire transfer of
immediately available funds to the Escrow Agent an amount equal to the Indemnity
Escrow Amount;
(iv) upon confirmation from the Escrow Agent that the
Sellers have delivered the Indemnity Escrow Amount, then the Buyer shall deliver
to an account designated by the Sellers, by wire transfer of immediately
available funds, an amount equal to the Preliminary Purchase Price (excluding
adjustments pursuant to Sections 1.4 and 1.6 which are accounted for in the
Escrow Amount) less (A) the Deposit (which the Parties shall instruct the Escrow
Agent to deliver to the Sellers), less (B) the Estimated Purchase Price
Adjustment; less (C) the Plan Escrow Amount and; less (D) the Inventory Escrow
Amount.
(v) the Buyer shall deliver by wire transfer of
immediately available funds to an account designated by the escrow agent (the
"Escrow Agent") under an escrow agreement, in form and substance reasonably
satisfactory to the Parties, to be entered into among the Sellers, the Buyer and
the Escrow Agent (the "Escrow Agreement"), an amount equal to the Estimated
Purchase Price Adjustment, the Plan Escrow Amount and the Inventory Escrow
Amount, to be held and disbursed along with the Indemnity Escrow Amount in
accordance with the Escrow Agreement and Section 1.6 hereof;
(vi) the Sellers shall execute and deliver to the
Buyer (A) a ▇▇▇▇ of sale in form and substance to be mutually agreed upon by the
Parties, (B) an assignment agreement with respect to the Assigned Contracts and
Leases in form and substance to be mutually agreed upon by the Parties, (C) a
warranty deed in form and substance to be mutually agreed upon by the Parties
with respect to each item of Owned Real Property, together with the Title
Policy; (D) stock certificate(s) representing the entire outstanding capital
stock of MCMS International duly
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endorsed to the Buyer, together with the stock certificates representing the
entire outstanding capital stock of MCMS Malaysia and MCMS China; and (E) such
other instruments of conveyance as the Buyer may reasonably request in order to
effect the sale, transfer, conveyance and assignment to the Buyer of good title
to the Acquired Assets;
(vii) the Buyer shall execute and deliver to the
Sellers an instrument of assumption in form and substance to be mutually agreed
upon by the Parties and such other instruments as the Sellers may reasonably
request in order to effect the assumption by the Buyer of the Assumed
Liabilities;
(viii) the Sellers shall deliver or cause to be
delivered to the Buyer the Approval Order;
(ix) the Sellers shall deliver to the Buyer a
certificate, as of a date not earlier than the day of the entry of the Approval
Order, of the Clerk of the Bankruptcy Court certifying as to the absence of the
filing of any stay with respect to the Approval Order, or, if a certificate to
such effect is not provided by such Clerk, then a certified copy of the court
docket for the Bankruptcy Case establishing to the reasonable satisfaction of
the Buyer the absence of any such stay as of the Closing Date;
(x) the Sellers shall deliver to the Buyer patent,
trademark, service ▇▇▇▇ and/or copyright assignments (which assignments shall be
prepared by the Buyer or its counsel with full cooperation of the Sellers, and
the Sellers shall request their intellectual property counsel to also cooperate
with the Buyer or its counsel, and such counsel shall be instructed by the
Sellers to provide such cooperation) duly executed by the Sellers and, if
applicable, any party to which a security interest was granted or assignment
made with respect to the foregoing providing for the assignment and transfer to
the Buyer of all of such entity's right, title and interest in and to all
patents, copyrights, trademarks, service marks, service names, trade names or
any applications therefor and any other Intellectual Property);
(xi) the Sellers shall deliver to the Buyer, or
otherwise put the Buyer in control of, all of the Acquired Assets of a tangible
nature; and
(xii) the Buyer and the Sellers shall execute and
deliver to each other cross-receipts and such other instruments, documents or
agreements, in form and substance reasonable acceptable to the Buyer and the
Sellers, as may be necessary to effect and evidence the transactions
contemplated by this Agreement.
1.6 Post-Closing Adjustments; Release of Escrow.
(a) Within fifteen (15) business days after the Closing Date,
the Sellers shall prepare in good faith, based on the books and records of the
Sellers and the Subsidiaries and, where applicable, with respect to all United
States assets and operations, in accordance with U.S. GAAP applied on a
consistent basis with the Financial Statements and the balance sheets of the
Foreign Entities, a certificate (such certificate, a "Closing Amounts
Certificate") setting forth in reasonable detail the calculations as of the
Closing Date of the following: (i) the total amounts of each of the items that
are required to be set forth on the Estimated Amounts Certificate pursuant to
Section 1.4 and (ii) the differences, if any, between the total amounts of each
item set
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forth on the Estimated Amounts Certificate and the total amounts of each
corresponding item set out pursuant to clause (i) above. The Buyer shall have
the opportunity to review the Closing Amounts Certificate for a period of
fifteen (15) business days after the delivery thereof, together with such
supporting work papers or other supporting information as may reasonably be
requested by the Buyer. Within such time, the Buyer shall prepare in good faith
and deliver to Sellers a Closing Amounts Certificate in accordance with the
standards used by Sellers to prepare a Closing Amounts Certificate. As promptly
as practicable and no later than five (5) business days from the date of the
Closing Amounts Certificate delivered by Buyer, the Buyer and the Sellers shall
endeavor in good faith for a period not to exceed ten (10) business days to
resolve any differences (the "Differences") between each Closing Amounts
Certificate. If the Parties are unable to resolve all their Differences and have
not agreed in writing to extend the resolution period, the parties agree that
the independent certified public accounting firm of Deloitte and Touche LLP (the
"Neutral Auditor") shall be employed to resolve any Differences after the end of
such ten (10) business day period or such extension of the resolution period
(all such other items relating to the Closing Amounts Certificate shall be
deemed to be final and binding on the Parties). Both Parties shall cooperate
with the Neutral Auditor and its representatives by providing access to all
relevant books and records and access at reasonable times to personnel having
relevant information. The Parties shall direct the Neutral Auditor to resolve
the Differences as soon as reasonably practicable, but in no event later than 30
days, and the decision of the Neutral Auditor shall be final and binding upon
the Parties. Such decision may be entered thereon as an arbitration award
pursuant to 9 U.S.C. ss.9 in any court of competent jurisdiction. The fees and
expenses of the Neutral Auditor shall be borne 50% by the Buyer and 50% by the
Sellers and the employment of the Neutral Auditor shall be deemed in the
ordinary course of the Sellers' business. If the Parties resolve all of their
Differences without employing the Neutral Auditor, the Parties shall, as soon as
possible after such resolution, jointly prepare a final Closing Amounts
Certificate that shall be deemed to be the "Final Closing Amounts Certificate."
If the Neutral Auditor is employed to resolve any Differences, the Neutral
Auditor shall prepare a final Closing Amounts Certificate that shall be deemed
to be the "Final Closing Amounts Certificate."
(b) Subject to the limitations set forth in Sections
1.6(b)(ii) and 1.6(b)(iii) below, the "Purchase Price Adjustment Amount" shall
be equal to:
(i) (A) the Net Working Capital Target; minus
(B) the sum of the following (each of which,
subject to subsection (ii) below, shall be as set forth on the Final Closing
Amounts Certificate) (as so calculated, the "Net Working Capital"):
(1) the Included Receivables; plus
(2) the Quality Inventory; plus
(3) twenty percent (20%) of the total value
of the Non-Quality Inventory; plus
(4) the Included Current Assets; plus
(5) the Foreign Entities Net Current Assets,
minus
(6) the Accrued Employee Liabilities; minus
(7) the Assumed Payables; minus
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(8) the Cancellation Fees.
(ii) In the event that the amount of the Quality
Inventory as set forth on the Final Closing Amounts Certificate is greater than
twenty million dollars ($20,000,000), then any amounts in excess of twenty
million dollars ($20,000,000) shall be excluded from the amount of Quality
Inventory for purposes of Section 1.6(b)(i)(B)(2) above, such exclusion not to
exceed five million dollars ($5,000,000).
(iii) In the event that the Net Working Capital
exceeds the Net Working Capital Target by an amount greater than four million
dollars ($4,000,000) (any such excess over $4,000,000 being the "Excess
Receivables Amount"), then certain accounts receivable of the Sellers shall be
excluded from the Included Receivables, such excluded accounts receivable to be
in an amount equal to the Excess Receivables Amount. In such event, the Buyer
shall designate those accounts receivable of the Sellers which shall be excluded
from the Included Receivables.
(c) The Buyer and the Sellers shall jointly instruct the
Escrow Agent pursuant to the Escrow Agreement to release the Escrow Amount as
follows:
(i) (A) Within one (1) business day following the
date the Final Closing Amounts Certificate is prepared, the Escrow Agent shall
be instructed to release (1) to the Buyer, an amount equal to the Purchase Price
Adjustment Amount (or so much as shall be available up to the Estimated Purchase
Price Adjustment), if such amount is a positive number and (2) to the Sellers,
an amount, if any, by which the Estimated Purchase Price Adjustment exceeds the
Purchase Price Adjustment Amount (or so much as shall be available up to the
Estimated Purchase Price Adjustment).
(B) In the event that the Estimated Purchase
Price Adjustment is less than the Purchase Price Adjustment Amount, then,
immediately following the release by the Escrow Agent of the Purchase Price
Adjustment Amount to the Buyer pursuant to Section 1.6(c)(i)(A)(1) above, the
Sellers shall deliver by wire transfer of immediately available funds to an
account designated by the Buyer an amount equal to the difference between the
Purchase Price Adjustment Amount and the Estimated Purchase Price Adjustment. In
the event that the Purchase Price Adjustment Amount is a negative number, then,
immediately following the release by the Escrow Agent of the Estimated Purchase
Price Adjustment to the Sellers pursuant to Section 1.6(c)(i)(A)(2) above, the
Buyer shall deliver by wire transfer of immediately available funds to an
account designated by the Sellers an amount equal to the absolute value of the
Purchase Price Adjustment Amount. Any wire transfer required to be made pursuant
to this Section 1.6(c)(i)(B) is referred to herein as the "Purchase Price
Adjustment Wire";
(ii) the Escrow Agent shall be instructed to release
the Plan Escrow Amount as follows: (A) to the Buyer, periodically, in the amount
of the payments made by Buyer pursuant to the Retention Plan, the MCMS Plan and
the Executive Severance Payments, upon presentation of the evidence of such
payments and (B) to the Sellers, on the fifth business day after the one year
anniversary of the Closing Date, in the amount equal the difference between the
Plan Escrow Amount and all amounts released to Buyer pursuant to clause (A);
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(iii) as provided in Section 1.6A of this Agreement with
respect to the Inventory Escrow Amount;
(iv) the Escrow Agent shall be instructed to release the
Indemnity Escrow Amount as follows: (A) to the Buyer, periodically, in the
amount of the indemnification obligations due to Buyer in accordance with
Article VIII of this Agreement and the terms of the Escrow Agreement and (B) to
the Sellers, on the one year anniversary of the Closing Date, in the amount
equal the difference between the Indemnity Escrow Amount and all amounts
released to Buyer pursuant to clause (A); provided, that, if at the one year
anniversary of the Closing Date, Buyer has an outstanding claim or claims for
indemnification against Sellers under Article VIII of this Agreement, the date
of release under this clause (B) with respect to any amounts subject to such
outstanding indemnification claim(s) shall be extended until the date when such
claim(s) is (are) settled and any amounts due under clause (A) have been
released to the Buyer; and
(v) (A) In the event that the total amount of Quality
Inventory set forth on the Estimated Amounts Certificate (the "Estimated Quality
Inventory Amount") is greater than the total amount of Quality Inventory set
forth on the Final Closing Amounts Certificate (the "Final Quality Inventory
Amount"), then, within one (1) business day following the date the Final Closing
Amounts Certificate is prepared, the Escrow Agent shall be instructed to release
to the Sellers an amount equal to 15% of the difference between the Estimated
Quality Inventory Amount and the Final Quality Inventory Amount; or
(B) In the event that the Estimated Quality Inventory
Amount is less than the Final Quality Inventory Amount, then, within one (1)
business day following the date the Final Closing Amounts Certificate is
prepared, the amounts otherwise payable to the Sellers hereunder shall be
reduced by, or if there are not sufficient funds to reduce the Sellers shall
deliver by wire transfer of immediately available funds to an account designated
by the Escrow Agent under the Escrow Agreement, an amount equal to 15% of the
difference between the Final Quality Inventory Amount and the Estimated Quality
Inventory Amount, and such amount shall be added to and become part of the
Inventory Escrow Amount.
1.6A Inventory Adjustment; Release of Inventory Escrow.
(a) Within fifteen (15) business days after the 180 day
anniversary of Closing Date (the "180 Day Anniversary"), the Buyer shall prepare
in good faith, based on the books and records of the Buyer and the Foreign
Entities and, where applicable, with respect to all United States assets and
operations, in accordance with U.S. GAAP applied on a consistent basis with the
Financial Statements and the balance sheets of the Foreign Entities, a
certificate (the "Inventory Certificate") setting forth in reasonable detail the
calculations, as of the 180 Day Anniversary, of the Inventory Adjustment Amount.
Within fifteen (15) business days after the 180 Day Anniversary, the Buyer shall
deliver to the Sellers the Inventory Certificate together with such supporting
work papers or other supporting information as may reasonably be requested by
the Sellers. As promptly as practicable and no later than five (5) business days
from the date of the Inventory Certificate, the Buyer and the Sellers shall
endeavor in good faith for a period not to exceed fifteen (15) business days to
resolve any disagreement between the parties on the Inventory Certificate. If
the Parties are unable to resolve all their disagreements and have not agreed in
writing to extend the resolution period, the parties agree that the Neutral
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Auditor shall be employed to resolve any disagreements after the end of such ten
(10) business day period or such extension of the resolution period (all such
other items relating to the Inventory Certificate shall be deemed to be final
and binding on the Parties). Both Parties shall cooperate with the Neutral
Auditor and its representatives by providing access to all relevant books and
records and access at reasonable times to personnel having relevant information.
The Parties shall direct the Neutral Auditor to resolve the disagreements as
soon as reasonably practicable, but in no event later than 30 days, and the
decision of the Neutral Auditor shall be final and binding upon the Parties.
Such decision may be entered thereon as an arbitration award pursuant to 9
U.S.C. ss.9 in any court of competent jurisdiction. The fees and expenses of the
Neutral Auditor shall be borne 50% by the Buyer and 50% by the Sellers and the
employment of the Neutral Auditor shall be deemed in the ordinary course of the
Sellers' business. If the Parties resolve all of their disagreements without
employing the Neutral Auditor, the Parties shall, as soon as possible after such
resolution, jointly prepare a final Inventory Certificate that shall be deemed
to be the "Final Inventory Certificate." If the Neutral Auditor is employed to
resolve any Differences, the Neutral Auditor shall prepare a final Inventory
Certificate that shall be deemed to be the "Final Inventory Certificate."
(b) The "Inventory Adjustment Amount" shall be equal to the
lesser of (i) the value (determined as of the Closing Date in the same manner
and amounts as used in the Final Closing Amounts Certificate) of any items of
Quality Inventory which have not been shipped to customers, or returned to
suppliers for full credit, on or prior to the 180 Day Anniversary; and (ii) the
Inventory Escrow Amount plus interest earned thereon under the Escrow Agreement.
(c) Within one (1) business day following the date the Final
Inventory Certificate is prepared, the Escrow Agent shall be instructed to
release (1) to the Buyer, an amount equal to the Inventory Adjustment Amount, if
such amount is a positive number and (2) to the Sellers, the balance.
(d) The Buyer shall return to the Seller any items of
Inventory in respect of which such Inventory adjustment under Section 1.6A(a) is
made (the "Returned Inventory"). The Sellers shall provide instructions for the
delivery of the Returned Inventory within 30 days of the date the Final
Inventory Certificate is prepared, and the cost of transportation shall be
Sellers' obligation.
1.7 Allocation. The Buyer and the Sellers agree that as soon as
reasonably practical after the date hereof and prior to the Closing Date, the
Buyer and the Sellers shall discuss the allocation of the Preliminary Purchase
Price and the Assumed Liabilities among the Acquired Assets and attempt in good
faith to reach agreement with respect thereto. If the Buyer and the Sellers
reach agreement with respect to the allocation of the Preliminary Purchase Price
and Assumed Liabilities, the Buyer and the Sellers shall make all required
non-U.S., federal, state and local income tax filings consistent with such
allocation (giving effect to mutually agreed upon adjustments to the allocation
as a result of any adjustment to the Preliminary Purchase Price in accordance
with Sections 1.4, 1.6 and 1.6A) and such allocation shall be used for all
purposes (including financial accounting purposes).
1.8 Employees. At the Closing, the Sellers shall pay certain retention
obligations under the Retention Plan previously delivered to the Buyer (the
"Retention Plan") to the
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Continuing Employees in an amount equal to $700,000 (the "Retention Plan
Payment"). Provided that Buyer is the successful bidder for the Acquired Assets,
if the Seller shall fail to do so at Closing, the Buyer will pay the severance
obligations under the MCMS Plan previously delivered to the Buyer (the "MCMS
Plan") following the Closing in the total aggregate amount of up to $1,600,000,
which shall be funded out of the Plan Escrow Amount. In the event that the
Sellers fail to make any portion of the Retention Plan Payment at the Closing,
the Buyer will pay such amount, which shall also be funded out of the Plan
Escrow Amount. At the Closing, the Buyer shall assume and become responsible for
payment of any severance or other similar compensation and benefits under the
executive employment agreements set forth on Schedule 1.8 (the "Executive
Employment Agreements") up to $1,400,000, which shall be paid to the employees
under the Executive Employment Agreements within thirty (30) days after the
Closing and which shall be funded out of the Plan Escrow Amount (the "Executive
Severance Payments").
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE SELLER
The Sellers and the Subsidiaries represent and warrant to the Buyer that the
statements contained in this Article II are true and correct, except as
disclosed in the schedules attached hereto (the "Schedules"). The disclosures in
any Schedule shall qualify only the corresponding paragraph in this Article II
unless and to the extent such disclosure is reasonably apparent on its face.
2.1 Organization, Qualification and Corporate Power. Each of the
Sellers and the Subsidiaries is duly organized and validly existing under the
laws of its respective jurisdictions of organization. Attached hereto as
Schedule 2.1 is a true and correct organizational chart of MCMS and each
corporation, partnership, limited liability company, joint venture or other
business association or entity in which MCMS has, directly or indirectly, an
equity interest representing 50% or more of the capital stock thereof or other
equity interests therein or voting power thereof (excluding the Belgian Entities
and the Mexican Entities, each a "Subsidiary" and collectively, the
"Subsidiaries"), which chart shows as to each, among other things, its exact
legal name, its jurisdiction of organization, all equity holders and their
respective ownership percentages. The Sellers and the Subsidiaries are in good
standing under the laws of their respective jurisdictions of organization. The
Sellers and the Subsidiaries are duly qualified to conduct their respective
businesses and are in good standing under the laws of each jurisdiction in which
the nature of their respective businesses or the ownership or leasing of their
respective properties require such qualification except for jurisdictions where
the failure to so qualify would not have a Material Adverse Effect. The Sellers
and the Subsidiaries have all requisite corporate power and authority to carry
on the businesses in which they are engaged and to own and use the properties
owned and used by them.
2.2 Authority. (a) The Sellers and the Subsidiaries have all requisite
power and authority to execute and deliver this Agreement and the Ancillary
Agreements and to perform its obligations hereunder and thereunder (subject to
entry of the Provision Order and the Approval Order with respect to the Sellers'
obligations dependent thereon); (b) this Agreement has been duly and validly
executed and delivered by the Sellers and the Subsidiaries and constitutes a
valid and binding obligation of the Sellers and the Subsidiaries, enforceable
against the Sellers
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and the Subsidiaries in accordance with its terms (subject to entry of the
Provision Order and the Approval Order with respect to the Sellers' and the
Subsidiaries' obligations dependent thereon), except as such enforceability may
be limited by principles of public policy and subject to the laws of general
application relating to bankruptcy, insolvency and the relief of debtors and
rules of laws governing specific performance, injunctive relief or other
equitable remedies (collectively, the "Enforceability Exceptions"); and (c) the
Ancillary Agreements, when delivered by the Sellers and the Subsidiaries at
Closing, will constitute valid and binding obligations of the Sellers and the
Subsidiaries, enforceable against the Sellers and the Subsidiaries in accordance
with their respective terms (subject to entry of the Provision Order and the
Approval Order with respect to the Sellers' obligations dependent thereon),
except as such enforceability may be limited by the Enforceability Exceptions.
2.3 Non-Contravention. Subject to compliance with the applicable
requirements of the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act, except as set forth on Schedule 2.3,
upon entry of the Provision Order and the Approval Order, neither the execution
and delivery of this Agreement or the Ancillary Agreements by the Sellers and
the Subsidiaries, nor the consummation by the Sellers and the Subsidiaries of
the transactions contemplated hereby or thereby, will (a) conflict with or
violate any provision of the charter, By-laws or governing documents of the
Sellers or any of the Subsidiaries, (b) require on the part of the Sellers or
any Subsidiary, any filing with, or any permit, authorization, consent or
approval of, any Governmental Entity or (c) violate any order, writ, injunction,
decree, statute, rule or regulation applicable to the Sellers or the
Subsidiaries, or any of their properties or assets.
2.4 Financial Statements; Absence of Certain Changes.
(a) The Sellers have provided the Buyer with copies of its
consolidated audited balance sheet and statement of income, changes in
stockholders' equity and cash flows for the year ended August 31, 2000 and
unaudited balance sheets and statements of income and cash flows for the
quarters ended November 30, 2000, February 28, 2001 and May 31, 2001, as well as
the audited financial statements of the Foreign Entities for the year ended
August 31, 2001 (the "Foreign Entity Audit"). Such financial statements
(collectively, the "Financial Statements") have been prepared in accordance with
United States generally accepted accounting principles ("U.S. GAAP") applied on
a consistent basis throughout the periods covered thereby (except with respect
to the Foreign Entity Audit, which has been prepared in compliance with the
generally accepted accounting principals of the relevant foreign jurisdictions),
fairly present in all material respects, as of the dates and for the periods
indicated, the financial condition, the results of operation and cash flows of
the Sellers and the Subsidiaries and are consistent with the books and records
of the Sellers and the Subsidiaries.
(b) Except as set forth on Schedule 2.4(b), since August 31,
2001, neither the Sellers nor any Subsidiary have incurred, to their knowledge,
any liabilities (whether known or unknown, absolute or contingent, liquidated or
unliquidated or due or to become due), other than (i) the liabilities shown on
the August 31, 2001 balance sheet provided to the Buyer and (ii) contractual
liabilities that arise in the ordinary course of the Sellers' and the
Subsidiaries' business, including with respect to frequency and amount, and that
are not material to the business of the Sellers and the Subsidiaries
individually and taken as a whole. There are no
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amounts outstanding under that certain loan agreement by and between Affin Bank
Berhad (formerly known as Perwira Affin Bank Berhad) and MCMS Malaysia (the
"Malaysian Loan").
(c) Since August 31, 2000, the Sellers and the Subsidiaries
have not changed, or agreed to change, in any material respect, their accounting
methods, principles or practices, except insofar as required by a generally
applicable change in U.S. GAAP or as disclosed in reports and public filings of
MCMS made with the United States Securities and Exchange Commission after August
31, 2000 through the date hereof (the "Public Filings").
(d) The Foreign Entities have duly filed all tax returns that
are required to have been filed by them, and have remitted to the appropriate
governmental authorities on a timely basis, and in accordance with all
applicable laws, rules and regulations, all amounts collected by them for taxes,
direct or indirect, including but not limited to sales taxes, value added taxes,
employment taxes, withholding taxes, customs duties, taxes and imports. The
Foreign Entities have made adequate provision for any amounts not yet remitted,
and no governmental agency has audited, or notified any Foreign Entity that it
intends to audit, any tax return.
2.5 Ownership and Condition of Assets. The Sellers and the Subsidiaries
have good title to all of the Acquired Assets and all of the material assets of
the Subsidiaries free and clear of all Security Interests, except as set forth
in Schedule 2.5. For purposes of this Agreement, "Security Interest" means any
mortgage, pledge, security interest, encumbrance, charge, lien, claim or
interest (whether arising by contract or by operation of law). Upon execution of
the Ancillary Agreements by the Sellers and the Subsidiaries at the Closing, the
Buyer will become the true and lawful owner of, and will receive good title to,
the Acquired Assets, free and clear of all Security Interests. The Acquired
Assets and the assets of the Subsidiaries constitute all material assets and
properties of the Sellers and the Subsidiaries, except for Excluded Assets,
currently in use or held for use in the conduct of the Sellers' and the
Subsidiaries' business.
2.6 Intellectual Property.
(a) The Intellectual Property Listing (A) is a true and
complete list of each patent, copyright, trademark, service ▇▇▇▇, or tradename
registration which has been issued to any of the Sellers or the Subsidiaries
with respect to any of their Intellectual Property, (B) identifies each pending
patent, copyright, trademark, service ▇▇▇▇ or tradename application or
application for registration which any of the Sellers or the Subsidiaries has
made with respect to any of their Intellectual Property, (C) identifies each
unregistered trademark, service ▇▇▇▇ or tradename of any of the Sellers and the
Subsidiaries and (D) identifies each license or other agreement pursuant to
which any of the Sellers or the Subsidiaries has granted to any third party (i)
rights to sublicense any Intellectual Property to another, (ii) rights to source
code, or (iii) rights to patents, or been granted any rights by any third party
with respect to any of its Intellectual Property (other than commercially
available, "shrink-wrap" type software or other off the shelf materials that are
paid or prepaid in full). The Sellers and the Subsidiaries own or have the right
to use all Intellectual Property used in the businesses of the Sellers or the
Subsidiaries utilizing the Acquired Assets or necessary for the operation of the
locations relating thereto. Except to the extent the failure to own any items of
Intellectual Property would not have a material effect on the ability of the
Buyer to operate the Facilities after the Closing, each item of the Sellers' and
the Subsidiaries' Intellectual Property will be owned or available for use by
the Buyer on
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identical terms and conditions immediately following the Closing. The Sellers
and the Subsidiaries have taken all reasonable measures to protect the
proprietary nature of their Intellectual Property, and to maintain in confidence
all trade secrets and confidential information, that they own or use. The
Sellers and the Subsidiaries have not granted to any third-party, and to the
knowledge of the Sellers and the Subsidiaries, no other person or entity has,
any rights to any of the Intellectual Property owned or used by the Sellers or
the Subsidiaries (except pursuant to agreements or licenses specified in the
Intellectual Property Listing), and to the knowledge of the Sellers and the
Subsidiaries, no person or entity is infringing, violating or misappropriating
any of the Intellectual Property except as specified in Schedule 2.6(a) attached
hereto. The Sellers and the Subsidiaries have made reasonable best efforts to
receive from all employees and contractors who may assert or have asserted any
right in or claim to any Intellectual Property as an inventor or otherwise an
invention assignment form, assigning such person's or entity's rights in the
Intellectual Property to the Sellers, as appropriate.
(b) Except as set forth on Schedule 2.6(b) attached hereto,
none of the activities or businesses presently conducted by the Sellers or the
Subsidiaries violates or constitutes a misappropriation of any Intellectual
Property rights of any other person or entity. Except as set forth in Schedule
2.6(b) attached hereto, the Sellers and the Subsidiaries have not received any
written complaint, claim or notice alleging any infringement, violation or
misappropriation of any Intellectual Property rights of any third party.
(c) The Sellers and the Subsidiaries have made available to
the Buyer true, correct and complete copies of all the patents, copyrights,
trademarks, service marks, registrations, applications, licenses and agreements
(as amended to date) listed on the Intellectual Property Listing and all working
files relating thereto and all other written documentation evidencing ownership
of, and any claims or disputes relating to, each such item listed on the
Intellectual Property Listing. Except as set forth in the Intellectual Property
Listing, with respect to each such item of Intellectual Property (i) the
license, sublicense or other agreement (whether to or from the Seller and the
Subsidiaries), covering such item is legal, valid, binding, enforceable and in
full force and effect and (ii) to the knowledge of the Sellers and the
Subsidiaries, the underlying item of Intellectual Property is not subject to any
outstanding judgment, order, decree, stipulation or injunction.
2.7 Contracts. The Sellers and the Subsidiaries have made available to
the Buyer a true, correct and complete copy of each of the Assigned Contracts
and Leases and all other material contracts of the Sellers and the Subsidiaries.
With respect to each Assigned Contract and Lease: (i) the Assigned Contract or
Lease is legal, valid, binding and enforceable against the Sellers, as the case
may be, except as such enforceability may be limited by Enforceability
Exception, and in full force and effect; (ii) except as set forth on Schedule
2.7 attached hereto, neither the Sellers nor any Subsidiary nor, to the
knowledge of the Sellers and the Subsidiaries, any other party, is in breach or
violation of, or default under, any such Assigned Contract or Lease (except for
any overdue amounts that are prepetition claims and that will be cured by the
Sellers in connection with the assumption and assignment to the Buyer), and no
event has occurred, is pending or, to the knowledge of the Sellers and the
Subsidiaries, is threatened, which, after the giving of notice, with lapse of
time, or otherwise, would constitute a breach or default by the Sellers or any
Subsidiary or, to the knowledge of the Sellers and the Subsidiaries, any other
party under such Assigned Contract or Lease; and (iii) except as set forth
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on Schedule 2.7, no party to such Assigned Contract or Lease has verbally or in
writing threatened to terminate such Assigned Contract or Leases, notified the
Sellers or any Subsidiary of an intent to terminate such Assigned Contract or
Lease or attempted to terminate such Assigned Contract or Lease.
2.8 Litigation. Except as disclosed in Schedule 2.8 attached hereto and
except for the Bankruptcy cases, there is no pending litigation, or to Sellers'
and the Subsidiaries' knowledge, any litigation or investigation threatened
against the Sellers or any Subsidiary which litigation or investigation could
reasonably be expected to have a Material Adverse Effect.
2.9 Legal Compliance. Except as set forth on Schedule 2.9 and except
with respect to compliance with Environmental Laws (which is covered in Section
2.15), the Sellers and the Subsidiaries are conducting and have conducted their
businesses in compliance with each law (including rules and regulations
thereunder) of any federal, state, local or foreign government, or any
Governmental Entity, which affects or relates to this Agreement or the
transactions contemplated hereby except as would not have a Material Adverse
Effect.
2.10 Customers and Suppliers. Schedule 2.10 attached hereto sets forth
a complete, true and correct listing of (a) each customer of the Sellers and the
Subsidiaries that accounted for more than 5% of the consolidated revenues of the
Sellers and the Subsidiaries during the last twelve (12) months and (b) each
supplier that accounted for more than 5% of the purchases of materials by the
Sellers and the Subsidiaries during the last twelve (12) months.
2.11 Subsidiaries. Except as set forth in Schedule 2.11(A) attached
hereto, none of the Subsidiaries of the Sellers owns any patents or patent
applications or copyrights, trademarks or other material Intellectual Property.
None of the Belgian Entities nor the Mexican Entities own any of the items set
forth on the Intellectual Property Listing. Except as set forth on Schedule
2.11(B) attached hereto, none of MCMS International, M.C.M.S. Asia Pacific Pte
Ltd ("MCMS Asia Pacific") or M.C.M.S. Singapore Pte Ltd ("MCMS Singapore") owns
or has owned any material property or assets or conducts or has conducted any
operations other than their ownership of equity interests in other Subsidiaries
or MCMS de Mexico S de RL de CV ("MCMS Mexico").
2.12 Employees. The Sellers and the Subsidiaries have used their
reasonable best efforts to cause all employees to enter into a
confidentiality/assignment of inventions agreement with the Sellers, the form of
which has previously been delivered to the Buyer. The Sellers and the
Subsidiaries are not a party to or bound by any collective bargaining agreement,
nor has it experienced any strikes, grievances, claims of unfair labor practices
or other collective bargaining disputes (and true and correct copies of all such
agreements, material correspondence and other material writings relating thereto
have been previously delivered to the Buyer). The Sellers and the Subsidiaries
have no knowledge of any other organizational effort presently being made or
threatened by or on behalf of any labor union with respect to employees of the
Sellers and the Subsidiaries.
2.13 Owned Real Property. Schedule 1.1(a)(v) attached hereto lists the
property address and the legal description of all Owned Real Property. With
respect to each piece of Owned Real Property, except as set forth on Schedule
2.13 attached hereto:
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(a) the Sellers have good and marketable title to such Owned
Real Property, free and clear of any Security Interest, easement, covenant or
other restriction, except for (i) recorded easements, covenants and other
non-environmental restrictions which do not impair the uses, occupancy or value
of such Owned Real Property; and (ii) liens reflected on any survey or in any
title report delivered to Buyer prior to the date hereof;
(b) there are no (i) pending or, to the knowledge of the
Sellers, threatened condemnation proceedings relating to such Owned Real
Property, (ii) pending or, to the knowledge of the Sellers, threatened
litigation or administrative actions relating to such Owned Real Property, or
(iii) other matters affecting materially and adversely the occupancy or value
thereof (which shall be deemed not to include general market conditions);
(c) the legal description for such Owned Real Property
contained in the deed thereof describes such Owned Real Property fully and
adequately in all material respects and, to the knowledge of the Seller, the
buildings and improvements may be used as of right under applicable zoning and
land use laws for the current uses in all material respects;
(d) there are no leases, subleases, licenses or agreements,
written or oral, granting to any party or parties (other than the Sellers or a
Subsidiary) the right of use or occupancy of any portion of such Owned Real
Property;
(e) there are no outstanding options or rights of first
refusal to purchase such Owned Real Property, or any portion thereof or interest
therein;
(f) all facilities located on such Owned Real Property are
supplied with utilities and other services necessary for the operation of such
facilities, including gas, electricity (including but not limited to all
necessary private electric supply agreements), water, telephone, sanitary sewer
and storm sewer;
(g) neither any of the Sellers nor any Subsidiary has received
notice of any proposed or pending proceeding to change or redefine the zoning
classification of all or any portion of such Owned Real Property;
(h) such Owned Real Property abuts on and has direct vehicular
access to a public road or access to a public road via a permanent, irrevocable,
appurtenant easement benefiting such property;
(i) to the knowledge of the Sellers, the improvements
constructed on such Owned Real Property are in good condition and proper order,
free of roof leaks, insect infestation, and material construction defects, and
all mechanical and utility systems servicing such improvements are in good
condition and proper working order, in each case free of material defects;
(j) the Sellers have delivered to the Buyer complete and
accurate copies of all of the following materials relating to such Owned Real
Property, to the extent in the Sellers' possession or control: title insurance
policies and commitments; deeds; encumbrance and easement documents and other
documents and agreements affecting title to or for operation of
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such Owned Real Property; surveys; appraisals; structural inspection, soils,
environmental assessment and similar reports; and
(k) there has been no change in or affecting the Owned Real
Property which would materially affect the 2000 survey of the Owned Real
Property.
2.14 Real Property Leases. Schedule 2.14 attached hereto lists all
leases and subleases pursuant to which the Sellers or a Subsidiary leases or
subleases from another party any real property (the "Leases"). The Sellers have
delivered to the Buyer complete and accurate copies of the Leases. With respect
to each Lease, except as set forth on Schedule 2.14 attached hereto:
(a) such Lease is legal, valid, binding, enforceable and in
full force and effect;
(b) such Lease is assignable by the Sellers or a Subsidiary to
the Buyer without the consent or approval of any party (except as set forth in
Schedule 2.14);
(c) none of the Sellers or any Subsidiary and, to the
knowledge of the Sellers and the Subsidiaries, no other party, is in breach or
violation of, or default under, any such Lease, and no event has occurred, is
pending or, to the knowledge of the Sellers and the Subsidiaries, is threatened,
which, after the giving of notice, with lapse of time, or otherwise, would
constitute a breach or default by the Sellers or any Subsidiary or, to the
knowledge of the Sellers and the Subsidiaries, any other party under such Lease;
(d) none of the Sellers or any Subsidiary has assigned,
transferred, conveyed, mortgaged, deeded in trust or encumbered any interest in
the leasehold or subleasehold;
(e) to the knowledge of the Sellers and the Subsidiaries, all
facilities leased or subleased thereunder are supplied with utilities and other
services adequate for the operation of said facilities in all material respects;
and
(f) the Sellers and the Subsidiaries are not aware of any
Security Interest, easement, covenant or other restriction applicable to the
real property subject to such lease which would reasonably be expected to
materially impair the current uses or the occupancy by the Sellers or a
Subsidiary of the property subject thereto.
2.15 Environmental.
(a) Except as set forth on Schedule 2.15, each of the Sellers
and the Subsidiaries has complied with all applicable Environmental Laws in all
material respects. There is no pending or, to the knowledge of the Sellers and
the Subsidiaries, threatened civil or criminal litigation, written notice of
violation, formal administrative proceeding, or investigation, inquiry or
information request by any Governmental Entity, relating to any Environmental
Law involving the Sellers or any Subsidiary.
(b) None of the Sellers or any Subsidiary has any material
liabilities or obligations arising from the release or threat of release of any
Hazardous Materials.
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(c) None of the Sellers or any Subsidiary is a party to or
bound by any court order, administrative order, consent order or other agreement
with any Governmental Entity entered into in connection with any legal
obligation or liability arising under any Environmental Law.
(d) Set forth in Schedule 2.15 attached hereto is a list of
all documents (whether in hard copy or electronic form) that contain any
material environmental reports, investigations and audits relating to premises
currently or previously owned or operated by the Sellers or a Subsidiary
(whether conducted by or on behalf of the Sellers or a Subsidiary or a third
party, and whether done at the initiative of the Sellers or a Subsidiary or
directed by a Governmental Entity or other third party) which any of the Sellers
or the Subsidiaries has possession of or can obtain access to. A complete and
accurate copy of each such material document has been provided to the Buyer.
(e) The Sellers and the Subsidiaries are not aware of any
material environmental liability of any solid or hazardous waste transporter,
any recycling facility or any treatment, storage or disposal facility that has
been used or is being used by the Sellers or any Subsidiary.
(f) For purposes of this Agreement:
(i) "Environmental Laws" shall mean any federal,
state, local or foreign law, statute, rule or regulation, any applicable
international treaty, agreement or standard, or the common law relating to the
environment or occupational health and safety, including but not limited to any
statute, regulation, administrative decision or order pertaining to (i)
treatment, storage, disposal, generation, manufacture, distribution in commerce
or transportation of industrial, toxic or hazardous materials or substances or
solid or hazardous waste; (ii) air, water and noise pollution; (iii) groundwater
and soil contamination; (iv) the release or threatened release into the
environment of industrial, toxic or hazardous materials or substances, or solid
or hazardous waste, including emissions, discharges, injections, spills, escapes
or dumping of pollutants, contaminants or chemicals; (v) the protection of wild
life, marine life and wetlands, including but not limited to all endangered and
threatened species; (vi) storage tanks, vessels, containers, abandoned or
discarded barrels and other closed receptacles; (vii) occupational health and
safety of employees and other persons; and (viii) manufacturing, processing,
using, distributing, treating, storing, recycling, disposing, transporting or
handling of materials regulated under any law as pollutants, contaminants, toxic
or hazardous materials or substances or oil or petroleum products or solid or
hazardous waste. As used above, the terms "release" and "environment" shall have
the meaning set forth in the U.S. Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. ss.9601 et seq. ("CERCLA").
(ii) "Hazardous Substances" shall mean any chemicals,
pollutants or contaminants, hazardous substances (as such term is defined under
CERCLA), solid wastes and hazardous wastes (as such terms are defined under the
U.S. Resource Conservation and Recovery Act, 42 U.S.C. ss.6901 et seq.), toxic
materials, oil or petroleum and petroleum products or any other material subject
to regulation under any Environmental Law.
2.16 Permits. Schedule 2.16 attached hereto sets forth a list of all
material Permits (including those issued or required under Environmental Laws
and those relating to the
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occupancy or use of Owned Real Property or Leased Real Property) issued to or
held by the Sellers or any Subsidiary and identifies those Permits which are not
transferable to the Buyer hereunder. Such listed Permits are the only Permits
that are required for the Sellers and the Subsidiaries to conduct their
respective businesses as presently conducted except as would not have a Material
Adverse Effect. Each material Permit is in full force and effect except as would
not have a Material Adverse Effect; the Sellers or the applicable Subsidiary is
in compliance with the material terms of each such material Permit; and, to the
knowledge of the Sellers and the Subsidiaries, no suspension or cancellation of
such Permit is threatened.
2.17 Disclosure. No representation or warranty by the Sellers or the
Subsidiaries contained in this Agreement and no statement contained in the
Schedules contains or will contain any untrue statement of a material fact or
omit or will omit to state any material fact necessary, in light of the
circumstances under which it was or will be made, in order to make the
statements herein or therein not misleading.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE BUYER
The Buyer represents and warrants to the Sellers that the statements contained
in this Article III are true and correct except as set forth below.
3.1 Organization. The Buyer is a corporation duly organized, validly
existing and in active status under the laws of the state of its incorporation.
The Buyer is duly qualified to conduct business and is in good standing under
the laws of each jurisdiction in which the nature of its businesses or the
ownership or leasing of its properties requires such qualification, except where
the failure to be so qualified or in good standing would not have a material
adverse effect on the properties or assets of the Buyer. The Buyer has all
requisite corporate power and authority to carry on the businesses in which it
is engaged and to own and use the properties owned and used by it. The Buyer has
furnished or made available to the Sellers complete and accurate copies of its
Articles of Incorporation and bylaws.
3.2 Authorization of Transaction. The Buyer has all requisite power and
authority to execute and deliver this Agreement and the Ancillary Agreements and
to perform its obligations hereunder and thereunder. The execution and delivery
of this Agreement and the Ancillary Agreements by the Buyer and the performance
of this Agreement and the consummation of the transactions contemplated hereby
and thereby by the Buyer have been duly and validly authorized by all necessary
corporate action on the part of the Buyer. This Agreement has been duly and
validly executed and delivered by the Buyer and constitutes a valid and binding
obligation of the Buyer, enforceable against it in accordance with its terms,
except as such enforceability may be limited by the Enforceability Exceptions.
The Ancillary Agreements, when delivered by the Buyer at Closing, will
constitute valid and binding obligations of the Buyer, enforceable against the
Buyer in accordance with their respective terms, except as such enforceability
may be limited by the Enforceability Exceptions.
3.3 Non-Contravention. Except for the applicable requirements of the
▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act and the Securities Exchange Act of 1934, as amended (the
"Exchange Act") or as set forth on Schedule 3.3 attached hereto, neither the
execution and delivery of this Agreement nor
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the Ancillary Agreements by the Buyer, nor the consummation by the Buyer of the
transactions contemplated hereby or thereby, will (a) conflict or violate any
provision of the charter or By-laws of the Buyer, (b) require on the part of the
Buyer any filing with, or permit, authorization, consent or approval of, any
Governmental Entity, (c) conflict with, result in breach of, constitute (with or
without due notice or lapse of time or both) a default under, result in the
acceleration of, create in any party any right to accelerate, terminate, modify
or cancel, or require any notice, consent or waiver under, any contract, lease,
sublease, license, sublicense, franchise, permit, indenture, agreement or
mortgage for borrowed money, instrument of indebtedness, Security Interest or
other arrangement to which the Buyer is a party or by which it is bound or to
which any of its assets is subject or (d) violate any order, writ, injunction,
decree, statute, rule or regulation applicable to the Buyer or any of its
properties or assets.
3.4 Litigation. There is no litigation or investigation pending, or to
Buyer's knowledge, threatened, against Buyer which litigation or investigation
could reasonably be expected to have a material adverse effect on the Buyer's
ability to consummate the transactions contemplated hereby.
3.5 Financial Ability. The Buyer has the financial resources necessary
to consummate the transactions contemplated by this Agreement, including,
without limitation, the ability to pay the Purchase Price.
3.6 Buyer Acknowledgment. THE BUYER ACKNOWLEDGES THAT THE SELLERS AND
THE SUBSIDIARIES MAKE NO REPRESENTATIONS OR WARRANTIES CONCERNING THE SELLERS,
THEIR SUBSIDIARIES, THEIR RESPECTIVE ASSETS (INCLUDING, WITHOUT LIMITATION,
INTELLECTUAL PROPERTY) OR THE BUSINESS CONDUCTED BY ANY OF THEM OTHER THAN AS
EXPRESSLY SET FORTH IN ARTICLE II HEREOF AND THAT THE SELLERS AND THE
SUBSIDIARIES EXPRESSLY DISCLAIM ALL OTHER REPRESENTATIONS AND WARRANTIES,
INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE.
ARTICLE IV
PRE-CLOSING COVENANTS
4.1 Efforts. Each Party shall use commercially reasonable efforts to
take all actions and to do all things necessary, proper or advisable to
consummate the transactions contemplated by this Agreement.
4.2 Notices and Consents. (a) Each of the Parties shall use
commercially reasonable efforts to obtain all such waivers, permits, consents,
approvals or other authorizations from third parties and Governmental Entities,
and to effect all such registrations, filings and notices with or to third
parties and Governmental Entities, as may be necessary in order to permit the
consummation of the transactions contemplated by this Agreement and permit the
Buyer following the Closing to hold and employ the Acquired Assets in a manner
consistent with current usage (including, without limitation, those permits
listed on Schedule 2.16 attached hereto).
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(b) The Sellers and the Foreign Entities shall diligently
pursue all reasonable actions which may be necessary or appropriate relating to
the maintenance or renewal of any tax or other governmental advantage of any of
the Foreign Entities.
4.3 HSR Act. If a filing is required by the HSR Act and rules and
regulations thereunder, each of the Parties hereto shall as promptly as
practicable, but in no event later than ten business days following the
execution and delivery of this Agreement, (i) file or cause to be filed with the
United States Federal Trade Commission (the "FTC") and the United States
Department of Justice (the "DOJ") the notification and report form required for
the transactions contemplated hereby and any supplemental information requested
in connection therewith pursuant to the HSR Act and (ii) make such other filings
as are necessary in other jurisdictions in order to comply with all applicable
laws relating to competition and, subject to the provisions in the last sentence
of this Section 4.3, shall promptly provide any supplemental information
requested by applicable Governmental Entities relating thereto. Any such filing,
notification and report form and supplemental information shall be in
substantial compliance with the requirements of the HSR Act or such other
applicable law. Each of the parties hereto shall furnish to the others such
necessary information and reasonable assistance as the others may request in
connection with its preparation of any filing or submission that is necessary
under the HSR Act or such other applicable law. Each of the parties hereto shall
keep the others apprised of the status of any communications with, and any
inquiries or requests for additional information from, the FTC, the DOJ and any
other applicable Governmental Entities and shall comply promptly with any such
inquiry or request. Each party shall use reasonable commercial efforts to obtain
any clearance required under the HSR Act or such other applicable law for the
consummation of the transactions contemplated by this Agreement; provided that,
notwithstanding anything to the contrary contained herein, the Buyer shall not
be obligated to (A) respond to formal requests for additional information or
documentary material pursuant to 16 C.F.R. 803.20 under the HSR Act except to
the extent it elects to do so in its sole discretion or (B) to sell or dispose
of or hold separately (through a trust or otherwise) any of the Acquired Assets
or any other assets or businesses of the Buyer or its affiliates.
4.4 Bankruptcy Covenants.
(a) Not later than two (2) business days subsequent to the
execution of this Agreement, the Sellers shall file a motion, pursuant to 11
U.S.C. ▇▇.▇▇. 105, 363, and 365 to approve the sale of the Acquired Assets to
the Buyer pursuant to this Agreement (the "Approval Motion"). The Sellers have
filed a motion (the "Provision Motion") for approval of the Overbid Provisions,
the Breakup Fee and all of the other provisions of Article IV of the Prior
Agreement. The Sellers have obtained approval of the Provision Motion (the
"Provision Order") and shall use their best efforts to obtain an order approving
the Approval Motion (the "Approval Order") within ten (10) days of the date of
this Agreement, provided that the Approval Order shall be in a form in
conformity with the form of order attached hereto as Exhibit A in all material
respects, with only such changes to such orders as shall be agreed to by the
Sellers and the Buyer. All of the Sellers' obligations and liabilities to the
Buyer arising upon the Buyer's termination of this Agreement in accordance with
Article VII hereof or in the event that the Buyer otherwise does not close on
the purchase of the Acquired Assets for any reason (including but not limited to
the Sellers' obligations to pay the Breakup Fee and return of the Deposit to the
Buyer) shall have administrative expense priority under ss.ss.503(b) and 507(a)
of the Bankruptcy Code.
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(b) The Sellers shall promptly provide the Buyer with drafts
of all documents, motions, orders, filings or pleadings that the Sellers propose
to file with the Bankruptcy Court which relate to the consummation or approval
of this Agreement, the Ancillary Agreements, the Provision Motion or any
provision herein or therein, and will provide the Buyer with reasonable
opportunity to review and approve such filings as reasonably practical. The
Sellers shall also promptly (within 1 business day) provide the Buyer with
facsimile copies of all pleadings received by or served by or upon the Sellers
in connection with its Bankruptcy Case which have not otherwise been served on
the Buyer (as shown on the certificate of service filed therewith) and as
otherwise requested by the Buyer.
(c) The Sellers shall use their reasonable best efforts to
obtain, at their sole cost and expense, the entry of an order authorizing the
Sellers to assume and assign the Assigned Contracts and Leases to the Buyer at
the Closing (the "Assignment Order"), such order contemplated to be included as
part of the Approval Order in such other form as shall be reasonably
satisfactory to the Buyer. The Sellers shall be responsible for the payment of
any amounts necessary to cure any defaults that exist on the Closing Date under
the Assigned Contracts and Leases (the "Cure Amounts"). The Buyer shall, from
time to time prior to the Closing, and subject to the Sellers' obligation to pay
the Cure Amounts, have the right to add or delete any executory contract or
unexpired lease to or from, or otherwise modify, the list of the Assigned
Contracts and Leases, except by adding any of the contracts listed on Schedule
1.1(a)(iv)(B). Notice of the proposed assumption and assignment of the Assigned
Contracts and Leases shall be provided in accordance with the Provision Order.
(d) From and after the date hereof, the Sellers shall not, and
shall ensure that none of the Subsidiaries, take any action or fail to take any
action, which action or failure to act would reasonably be expected to result in
(A) the reversal, avoidance, revocation, vacating or modification (in any manner
which would reasonably be expected to materially and adversely affect the
Buyer's rights hereunder) or (B) the entry of a stay pending appeal, in the
cases of each of sub-clauses (A) or (B) of this Section, with respect to the
Approval Order, the Assignment Order or the Provision Order; provided, however,
that nothing contained herein will in any way limit the Seller's ability to
provide notice of the Approval Motion and to comply with requests for
information from potential competing bidders for the Acquired Assets so long as
it is in compliance with the provisions of Section 4.8 hereof, or to comply with
applicable law; and
(e) From and after the commencement of the Chapter 11 Case,
the Sellers shall (A) continue to operate their businesses as debtors in
possession pursuant to Sections 1107 and 1108 of the Bankruptcy Code, (B)
provide the Buyer with a true and accurate copy of all monthly reports provided
to the office of the United States Trustee with respect to Seller in its Chapter
11 Case(s) and the Seller shall not be delinquent in providing any such reports
and (C) pay all of their postpetition obligations when due.
4.5 Operation of Business. Except as contemplated by this Agreement or
consented to by the Buyer, which consent shall not be unreasonably withheld, and
to the extent not inconsistent with the Bankruptcy Code, the Bankruptcy Rules,
the operation and information requirements of the Office of United States
Trustee (the "OIRR"), or any orders entered by the Bankruptcy Court in the
Sellers' Chapter 11 Cases during the period from the date of this Agreement to
the Closing or otherwise required by applicable law, the Sellers and the
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Subsidiaries shall conduct their operations in compliance with all applicable
laws and regulations in all material respects, and to the extent consistent
therewith so as to preserve the current value and integrity of the Acquired
Assets, pay all post-petition taxes as they become due and payable, maintain
insurance on the Acquired Assets (in amounts and types consistent with past
practice), use its best efforts to preserve its relationships with customers,
suppliers and others having business dealings with it and take all actions (or
refrain from taking any actions) to avoid the occurrence of a Material Adverse
Effect. Notwithstanding the foregoing, the Sellers and the Subsidiaries shall
consult with the Buyer prior to any transfer of any Acquired Assets or any other
assets of the Subsidiaries (except for Excluded Assets) from its locations as of
the date hereof (except for transfers in the ordinary course of business), to
determine a means of effectuating such transfer so as not to affect the value of
the Acquired Assets to the Buyer. Without limiting the generality of the
foregoing, prior to the Closing, the Sellers and the Subsidiaries shall, subject
to the requirements of the Bankruptcy Code, Bankruptcy Rules, the OIRR, and
orders entered by the Bankruptcy Court in the Sellers' Chapter 11 Cases, conduct
its operations in the ordinary and usual course of business and shall not,
without the prior written consent of the Buyer:
(a) sell, lease, license, encumber or dispose of any material
Acquired Assets, except in the ordinary course of business consistent with past
practices both in frequency and amount and except for liens to secure
debtor-in-possession financing or providing adequate protection in connection
with such debtor-in-possession financing;
(b) pay any prepetition liabilities other than such
prepetition liabilities as are approved for payment by the Court;
(c) take any action or fail to take any action required by
this Agreement with the knowledge that such action or failure to take action
would result in any of the representations and warranties of the Sellers or the
Subsidiaries set forth in this Agreement becoming untrue in any material
respect;
(d) take any action to waive or compromise any material claims
(whether or not asserted in any pending litigation) which are included in the
Acquired Assets;
(e) borrow any amounts under the Malaysian Loan; or
(f) agree in writing or otherwise to take any of the foregoing
actions.
4.6 Full Access and Confidentiality. The Sellers and the Subsidiaries
shall permit representatives of the Buyer to have full access (at reasonable
business hours, and in a manner so as not to interfere with the normal business
operations of the Sellers and the Subsidiaries) to all premises, properties,
financial and accounting records, contracts, other records and documents, and
personnel, of or pertaining to the Sellers and the Subsidiaries. The Parties
hereto shall treat and hold as confidential any information obtained through the
diligence process or in connection with this Agreement in accordance with the
Confidentiality Agreement between MCMS and Plexus Corp. dated on or about
September 26, 2001 (the "Confidentiality Agreement").
4.7 Notice of Breaches. Each Party hereto shall promptly deliver to the
other Parties written notice of any event or development that would (i) render
any statement, representation or
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warranty of such Party in this Agreement (including exceptions set forth in the
Schedules) inaccurate or incomplete in any material respect, or (ii) constitute
or result in a material breach by such Party of, or a failure by such Party to
comply with, any agreement or material covenant in this Agreement applicable to
such Party. No such disclosure shall be deemed to avoid or cure any such
misrepresentation or breach. In addition, the Sellers and the Subsidiaries shall
promptly provide the Buyer with any notice of or advise the Buyer of any
knowledge or communication regarding any alleged or actual breaches by any of
the Sellers or the Subsidiaries of any material contract or agreement of the
Sellers and the Subsidiaries relating to the Acquired Assets.
4.8 Exclusivity.
(a) From the date hereof until the earlier of (1) the
termination of this Agreement in accordance with its terms and (2) the entry by
the Bankruptcy Court of the Approval Order (the "Exclusivity Period"), subject
to Section 4.8(b) below, the Sellers shall not, and shall use their best efforts
to cause its Subsidiaries and each of its directors, officers, employees,
representatives and agents not to, directly or indirectly: encourage, solicit,
initiate, agree to, endorse or take any other action to facilitate any proposal
or offer from any person or entity (other than the Buyer or an affiliate,
associate, representative or agent of the Buyer) concerning any merger,
consolidation, sale of material assets, recapitalization acquisition of shares
of stock of the Sellers or the Subsidiaries or other business combination
involving Sellers or any division of the Sellers or any of their respective
businesses relating to the Acquired Assets and the Assigned Contracts and Leases
(an "Alternative Proposal") or provide any non-public information concerning the
business, properties or assets of any Seller or the Subsidiaries to any person
or entity (other than the Buyer) (the "Exclusivity Provision").
(b) Nothing contained in Section 4.8(a) above shall prohibit
the directors and officers of the Sellers and other senior employees designated
by such officers from providing information, including non-public information
described in Section 4.8(a), to any persons who may request such information in
connection with making a proposal as part of the Section 363 sale process
contemplated by this Agreement, or having discussions with such person with
respect to such information as it relates to the making of such proposal.
4.9 Customer Approach. The Sellers shall use their reasonable best
efforts to obtain reasonable assurances from the customer listed on Schedule 4.9
that such customer will extend its current supply agreement with Sellers or
enter into a new agreement extending such supply arrangements with Sellers for
one year past the current expiration date of the current supply agreement with
such customer.
4.10 Breakup Fee and Cost Reimbursement Provisions.
(a) In the event that the Sellers sell or otherwise transfer
all or any substantial portion of the Acquired Assets to the Buyer and not to
the Initial Bidder, then the Break Up Fee and the Reimbursement Claim (both as
defined in the Prior Agreement) and all other claims that are asserted by the
Initial Bidder under Section 4.10 of the Prior Agreement shall constitute claims
against the Sellers' estates and the Buyer shall have no obligation to the
Initial Bidder for any claims of any nature whatsoever.
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(b) In the event that the Buyer is not the successful
purchaser under the terms of this Agreement and Sellers transfer all or a
substantial portion of the Acquired Assets to any party other than Buyer, then
Buyer shall be entitled to reimbursement of its actual costs (including
allocated internal expenses) and reasonable expenses, including attorneys' fees,
in an amount up to $350,000 (the "Cost Reimbursement Claim"), which shall be
promptly paid to the Buyer. The claims of the Buyer to payment of the Cost
Reimbursement Claim constitute an allowed administrative expense claim under
Bankruptcy Code ▇▇.▇▇. 503(b) and 507(a)(1) and shall have priority in right of
payment over all liens that attach to the proceeds of any sale or transfer of
such assets. The Cost Reimbursement Claim provided for by this Section 4.10 is
intended to cover the expenses incurred by the Buyer in conducting due
diligence, pursuing and negotiating this Agreement and the transactions
contemplated hereby, and is considered by the Parties to be reasonable for such
purposes.
4.11 Solicitation of Employees. Buyer shall comply with the
restrictions with respect to the solicitation of employees set forth in that
certain Confidentiality Agreement; provided that such agreement shall no longer
apply to the solicitation of employees of the Sellers as contemplated by this
Agreement in the event that the Approval Order is entered, or to the extent
consented to by the Sellers in writing.
4.12 Bringdown of Schedules. The Sellers shall, as of the Closing Date,
provide the Buyer with any and all revisions, modifications and updates to the
Schedules such that the Schedules shall be true and correct as of such date, and
shall include, without limitation, any and all executory contracts and leases
which the Sellers have entered into after the date hereof. Nothing contained in
this Section 4.12, and no such provision of any such revisions, modifications or
updates, shall affect the Sellers' or the Subsidiaries' liability for any breach
of any representation or warranty in this Agreement, and the Buyer's rights
under this Agreement shall not be affected by its receipt of any such revisions,
modifications or updates.
4.13 Certain Employees. (a) No later than thirty (30) days following
the date hereof, the Buyer shall deliver to the Sellers a list of up to 50
Continuing Employees, which list shall become Schedule 4.13 hereto. As soon as
practicable following the delivery to the Sellers of such Schedule 4.13, but in
any event no later than five (5) business days following such delivery, the
Buyer shall make offers of employment, subject to the Closing, to all
individuals listed on such Schedule 4.13. (b) The Buyer and the Sellers shall
cooperate and use their reasonable best efforts to mitigate severance and other
related obligations and liabilities in connection with the termination of
employees.
4.14 Buyer Audit. The Sellers shall cooperate with the Buyer in
connection with obtaining and delivering to the Buyer, to the extent reasonably
requested by the Buyer, an audit of the books and records of the Sellers and the
Subsidiaries as of the fiscal year ended August 30, 2001. The Buyer shall engage
the independent auditor in connection with such audit and shall pay the fees and
expenses of such auditor in connection therewith.
4.15 Certain Matters. Upon the entry of the Approval Motion, the
Sellers shall, at the request of the Buyer, cooperate with the Buyer with
respect to the matters described in Schedule 1.4(b)(ii) attached hereto.
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4.16 Inter-Company Payables and Receivables. The Sellers hereby agree
that at the Closing, the Sellers shall waive, and shall cause their subsidiaries
to waive, all of their right, title and interest in and to any Foreign Entity
Inter-Company Payables. The Buyer hereby agrees that at the Closing, the Buyer
shall waive all of its right, title and interest in and to any Foreign Entity
Inter-Company Receivables. Such actions shall be accomplished without any cost
(including any tax cost or effect) to the Buyer or the Foreign Entities.
4.17 Cisco/Nokia/ATT Assets.
(a) As soon as possible after the date of this Agreement, the
Sellers and the Buyer shall in good faith jointly prepare a plan (the
"Cisco/Nokia/ATT Plan") pursuant to which the Buyer will warehouse the Cisco
Inventory (at no storage cost) and build-out Cisco products using the Cisco
Inventory under a mutually agreeable sub-contracting arrangement to the extent
necessary under the Sellers' existing contracts with Cisco. Prior to the
Closing, the Sellers shall segregate the Cisco Inventory from all other
Inventory and store the same in one Facility (and in an area(s) within such
Facility) to be mutually agreed upon by the Sellers and the Buyer. The Sellers
and the Buyer agree that in no event shall the Buyer (i) be required to store
the Cisco Inventory for a period greater than one hundred twenty (120) days
after the Closing Date (after which period the Sellers shall remove the same at
their sole cost and expense), (ii) assume any risk of loss for any of the Cisco
Inventory or (iii) assume any liabilities in connection with any claims made by
Cisco or any third parties relating to the build-out of Cisco products using the
Cisco Inventory ("Cisco Claims"). In the event that the Sellers and the Buyer
are unable to agree on the Cisco/Nokia/ATT Plan prior to the Closing Date, then
the Sellers shall, at their sole cost and expense, promptly remove all Cisco
Inventory from the Facilities.
(b) Prior to the Closing, the Sellers shall segregate the
Nokia Inventory and the ATT Inventory and, at the Closing, all other Inventory
which is not purchased by the Buyer hereunder (the "Other Inventory") in one
Facility (and in an area(s) within such Facility) to be mutually agreed upon by
the Sellers and the Buyer. The Buyer will warehouse the Nokia Inventory, the ATT
Inventory and the Other Inventory for a period not to exceed one hundred twenty
(120) days after the Closing Date (after which period the Sellers shall remove
the same at their sole cost and expense) as further detailed in the
Cisco/Nokia/ATT Plan. The Buyer shall be paid an administrative fee for such
storage equal to 1.5% of the value of the Nokia Inventory, ATT Inventory and the
Other Inventory (calculated at the acquisition cost of such Nokia Inventory, ATT
Inventory and Other Inventory by the Sellers or the Subsidiaries, as applicable)
as of the sixty-first (61st) day following the Closing Date. The Buyer shall not
assume any risk of loss for any of the Nokia Inventory, the ATT Inventory or the
Other Inventory. In the event that the Sellers and the Buyer are unable to agree
on the Cisco/Nokia/ATT Plan prior to the Closing Date, then the Sellers shall,
at their sole cost and expense, promptly remove all Nokia Inventory, ATT
Inventory and Other Inventory from the Facilities.
4.18 Survey. The Sellers shall use their reasonable best efforts to
obtain, at their cost, an ALTA/ACSM survey of all Owned Real Property at least
five business days prior to the Closing.
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ARTICLE V
CONDITIONS TO CLOSING
5.1 Conditions to Obligations of the Buyer. The obligation of the Buyer
to consummate the transactions to be performed by it in connection with the
Closing is subject to the satisfaction or waiver by the Buyer of the following
conditions:
(a) the sale of the Acquired Assets by the Sellers to the
Buyer as a good faith purchaser for value within the meaning of Section 363(m)
of the Bankruptcy Code and free and clear of all liens, claims, encumbrances and
interests as contemplated by this Agreement shall have been approved by the
Bankruptcy Court pursuant to the Approval Order which, as of the Closing Date,
shall be in full force and effect, and not stayed, modified, vacated, amended or
revoked;
(b) the assumption and assignment by the Sellers of the
Assigned Contracts and Leases to the Buyer shall have been authorized and
approved by an order of the Bankruptcy Court and such order is in full force and
effect without any modification or amendment, as of the Closing Date, and Seller
shall have paid the Cure Amounts related to each of the Assigned Contracts and
Leases;
(c) the Sellers or the Subsidiaries, as the case may be, shall
have obtained all of the waivers, permits, consents, approvals or other
authorization from Governmental Entities that are required to consummate the
transactions contemplated hereby and operate the Facilities, and shall have
obtained reasonable assurances that the tax holiday and pioneer agreements and
similar arrangements of the Foreign Entities shall not cease or be materially
diminished as a result of the Foreign Entities becoming subsidiaries of the
Buyer, except to the extent the failure to obtain such waivers, permits,
consents, approvals or other authorization does not have any material effect on
the ability of the Buyer to operate the Facilities, individually or taken as a
whole;
(d) the Sellers and the Subsidiaries shall have obtained,
without cost to the Buyer, all of the waivers, permits, consents, approvals or
other authorization from any third parties (other than Governmental Entities )
that are required to consummate the transactions contemplated hereby and operate
the Facilities, including, without limitation, any consents necessary in
connection with the assignment or deemed assignment of any of the Assigned
Contracts and Leases, the Intellectual Property or the Permits, except to the
extent the failure to obtain such waivers, permits, consents, approvals or other
authorization does not have any material effect on the ability of the Buyer to
operate the Facilities, individually or taken as a whole;
(e) all of the representations and warranties of the Sellers
and the Subsidiaries set forth in Article II hereof as qualified by the
Schedules (without giving effect to any revisions, modifications or updates
pursuant to Section 4.12 hereof), shall be true and correct in all material
respects as of the date hereof and as of the Closing as if made as of the
Closing (other than those representations and warranties which are qualified as
to materiality, which shall be true and correct in accordance with their terms)
regardless of any examination or investigation made at any time by or on behalf
of the Buyer or the actual knowledge of any of the Buyer's officers,
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directors, employees or agents at the time of the Buyer's execution of this
Agreement, except to the extent any of such representations and warranties are
made as of a specific date, in which case such representations and warranties
shall be true and correct in all material respects as of the specified date;
(f) the Sellers and the Subsidiaries shall have performed or
complied in all material respects with its agreements and covenants required to
be performed or complied with under this Agreement as of or prior to the
Closing;
(g) (1) no action, suit or proceeding shall be pending before
any Governmental Entity, court or arbitrator wherein an unfavorable judgment,
order, decree, stipulation or injunction would (i) prevent consummation of any
of the transactions contemplated by this Agreement (except for the Bankruptcy
Case, the Provision Motion and the Approval Motion), (ii) cause any of the
transactions contemplated by this Agreement to be rescinded following
consummation or (iii) materially and adversely affect the right of the Buyer to
own, operate or control the Acquired Assets following the Closing, and no such
judgment, order, decree, stipulation or injunction shall be in effect; (2) there
shall be no motions pending to convert or dismiss the Chapter 11 Cases or to
appoint a trustee for the Sellers or any Subsidiary; and (3) there shall be no
injunctions or insolvency proceedings involving any foreign Subsidiary.
(h) the Sellers and the Subsidiaries shall have delivered to
the Buyer a certificate (without qualification as to knowledge or materiality or
otherwise) to the effect that each of the conditions specified in clauses (d),
(e) and (f) of this Section 5.1 is satisfied in all respects;
(i) since the Filing Date, except for the commencement of the
Chapter 11 Cases, there shall have been no Material Adverse Effect, and no event
or development has occurred which would reasonably be foreseen to result in a
Material Adverse Effect, except as disclosed in Schedule 2.7 to this Agreement
or as disclosed by the Sellers to the Buyer prior to November 19, 2001;
(j) since the Filing Date, except for the commencement of the
Chapter 11 Cases, there shall have been no change or effect relating to the
Acquired Assets, individually or taken as a whole, that is or is reasonably
likely to be material and adverse to the ability of the Buyer to own, operate or
control the Acquired Assets following the Closing; except as disclosed by the
Sellers to the Buyer prior to November 19, 2001;
(k) the Sellers shall have provided to the Buyer the legal
opinions of counsel set forth on Schedule 5.1(k);
(l) (A) no customer of the Sellers that is listed on Schedule
5.1(l) attached hereto shall have terminated its relationship with the Sellers
or any agreement relating thereto or given notice of its intent to do so, and
(B) no such customer shall have merged with or into or been acquired by another
entity or otherwise been subject to a change of control (or announced its
intention or entered into an agreement to do any of the same) if such other
entity uses (1) Jabil Circuit Inc., (2) Solectron Corp., (3) SCI Systems Inc.,
(4) Celestica Inc. or (5) Sanmina Corp. as its primary contract manufacturer;
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(m) no more than ten (10) individuals listed on Schedule 4.13
attached hereto shall have terminated his or her employment with the Sellers or
given notice of his or her intent to do so;
(n) the Sellers shall have achieved if the Closing occurs
during December, 2001, aggregate revenue for the months ending August 31, 2001,
September 30, 2001, October 31, 2001 and November 30, 2001 of at least $55
million. All revenue calculations shall be made in accordance with U.S. GAAP
applied on a consistent basis with past practices of the Sellers;
(o) MCMS International shall have transferred, at no cost or
tax effect to MCMS International, its remaining subsidiaries or the Buyer, to
MCMS or a subsidiary of MCMS that is not being purchased by the Buyer all of the
capital stock or other ownership interests of MCMS Asia Pacific and MCMS
Singapore so that the Mexican Entities are no longer owned by MCMS International
but rather MCMS, or such subsidiary of MCMS, shall directly own MCMS Asia
Pacific and MCMS Singapore, which in turn shall continue to own MCMS Mexico;
(p) at least five business days prior to Closing, the Buyer
shall have received from the Seller, at the Seller's cost and in form and
substance reasonably satisfactory to the Buyer, a commitment for an ALTA Form B
Owner's Policy of Title Insurance (the "Title Policy") from a national title
insurance company in an amount equal to the portion of the Purchase Price
allocated to the Owned Real Property;
(q) Seller shall have paid, or made reasonable arrangements or
set-asides for payments, of any break-up or similar fee due by it under the
Prior Agreement; and
(r) the actions as contemplated by Section 4.16 (relating to
Foreign Entity Inter-Company Payables and Foreign Entity Inter-Company
Receivables) shall have occurred.
5.2 Conditions to Obligations of the Sellers. The obligation of the
Sellers to consummate the transactions to be performed in connection with the
Closing is subject to the satisfaction or waiver by the Sellers of the following
conditions:
(a) all of the representations and warranties of the Buyer set
forth in Article III hereof shall be true and correct in all material respects
as of the date hereof and as of the Closing as if made as of the Closing (other
than those representations and warranties which are qualified as to materiality,
which shall be true and correct in accordance with their terms), except to the
extent any of such representations and warranties are made as of a specific
date, in which case such representations and warranties shall be true and
correct in all material respects as of the specified date;
(b) the Buyer shall have performed or complied with its
agreements and covenants required to be performed or complied with under this
Agreement as of or prior to the Closing;
(c) the Buyer shall have delivered to the Sellers a
certificate (without qualification as to knowledge or materiality or otherwise)
to the effect that each of the conditions specified in clauses (a) and (b) of
this Section 5.2 is satisfied in all respects;
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(d) the sale of the Acquired Assets by the Sellers to the
Buyer as contemplated by this Agreement shall have been approved by the
Bankruptcy Court pursuant to the Approval Order, which, as of the Closing Date,
shall be in full force and effect and not stayed, modified, vacated, amended,
and revoked; and
(e) the Buyer shall have obtained all of the waivers, permits,
consents, approvals or other authorization from Governmental Entities that are
required to consummate the transactions contemplated hereby.
ARTICLE VI
POST-CLOSING COVENANTS
6.1 Employees.
(a) As of the Closing Date, the Buyer will offer employment to
the Continuing Employees on such terms, at such salary or wage levels, and with
such employee benefits as are substantially similar to those provided to
similarly situated employees of the Buyer.
(b) Following the Closing Date, the Buyer shall cause all
applicable employee benefit plans, programs and arrangements of the Buyer to
provide that a Continuing Employee's period of employment with the Sellers shall
be treated as service for Buyer for purposes of eligibility and vesting under
Buyer's employee benefit plans, programs and arrangements (the "Buyer Plans") to
the extent permitted by law and applicable regulations. The Buyer further agrees
to recognize the vacation and sick leave days accumulated as of the Closing Date
by the Continuing Employees during the time they were employed by the Sellers.
(c) Buyer shall assume and become responsible for payment to
any Continuing Employee of any severance or other similar compensation and
benefits under the MCMS, Inc. Severance Plan which are or may become payable as
a result of the termination of any such Continuing Employee by the Buyer
following the Closing Date.
(d) Buyer shall not during the 90-day period beginning on the
Closing Date terminate the employment of Continuing Employees so as to cause any
"plant closing" or "mass layoff" (as those terms are defined in the WARN Act)
such that the Sellers have any obligation under the WARN Act that the Sellers
otherwise would not have had absent such terminations; provided, however, that
in the event of any breach by the Buyer of the foregoing, the Buyer shall
indemnify the Sellers for any such obligations.
(e) Any and all pre-existing condition limitations and
eligibility waiting periods under any Buyer Plan shall be waived with respect to
the Continuing Employees and their eligible dependents.
6.2 Collection of Additional Receivables. The Buyer shall use
substantially the same efforts which the Buyer uses with respect to the
collection of the Buyer's accounts receivable to collect any accounts receivable
of the Sellers which are not Included Receivables or Foreign Entity
Inter-Company Payables (the "Additional Receivables") on behalf of the Sellers,
and the Buyer shall be paid an administrative fee for such collections of 2% of
the Additional Receivables actually collected. The Buyer shall deliver any
collected Additional Receivables
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(less such administrative fee) to the Sellers promptly after receipt of the
same, provided, however, that in the event that the Sellers are required to make
a Purchase Price Adjustment Wire and fail to do so as provided herein, the Buyer
shall be entitled to deposit any Additional Receivables collected (in lieu of
paying the same to the Sellers) to restore any portion of the Indemnity Escrow
Amount which was used to reimburse the Buyer for the Sellers' failure to so make
a Purchase Price Adjustment Wire.
6.3 Use of Name. From and after the Closing, the Sellers agrees not to
use or allow any subsidiary of the Sellers to use any trademarks or tradenames
included within the Acquired Assets or any names reasonably similar thereto
after the Closing Date in connection with any business related to, competitive
with, or an outgrowth of, the business conducted by the Sellers on the date of
this Agreement. Sellers shall amend its charters and other corporate records to
comply with this provision on or prior to the Closing; provided, however, that
the Buyer agrees to grant a license for a period not to exceed 180 days to the
Sellers upon terms reasonably satisfactory to the Buyer to use the MCMS name in
connection with their Chapter 11 Bankruptcy Cases, the use, operation or
disposition of the Retained Assets and the Retained Liabilities, the winding
down of the business of the Sellers and the operation of the Belgian Entities
and the Mexican Entities.
6.4 Cooperation. (a) From and after the Closing, the Parties shall
cooperate with each other to give full effect to the terms and provisions of
this Agreement.
(b) Buyer shall provide, and shall cause its representatives
and employees to provide, including any Continuing Employees, reasonable
cooperation (for which the Sellers shall reimburse the Buyer to the extent such
cooperation requires the services of more than one person for greater than
twenty (20) hours in any week) in connection with any rights, claims, causes of
action or litigation involving Sellers or any potential litigation contemplated
by the Sellers relating to the Retained Assets or the operation of the business
conducted by the Sellers before Closing or any dispute involving the Sellers
concerning any Retained Asset, in each case against any third party. The Sellers
shall bear all of the out-of-pocket costs and expenses (including without
limitation, attorneys' fees, but excluding reimbursement for salaries and
employee benefits) reasonably incurred in connection with providing such
cooperation.
(c) If any of the Acquired Assets is in the care or custody of
any non-debtor party, following the Closing, Sellers shall cause such party to
immediately upon request surrender any such Acquired Assets in its care or
custody to the Buyer.
6.5 Post-Closing Assumption and Assignment. The Sellers shall use their
reasonable best efforts to obtain the entry of a final order authorizing the
Sellers to assume and assign to the Buyer any and all additional executory
contracts of Sellers which are not the subject of the Assignment Order, to the
extent that such executory contracts have not been included in Schedule
1.1(a)(iv)(B) and were discovered or disclosed by the Sellers or the Buyer after
the date hereof, entered into by the Sellers after the date hereof or otherwise
identified by the Buyer as an executory contract which the Sellers will assign
to the Buyer. The Sellers shall be obligated to pay all Cure Costs with respect
to such additional executory contracts.
6.6 Taxes.
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(a) The Sellers and the Buyer shall cooperate in timely making
all filings, returns, reports and forms as may be required in connection with
the payment of taxes in connection with the consummation of the transactions
contemplated hereby. The Sellers and the Buyer, as appropriate, shall execute
and deliver all instruments and certificates necessary to enable the other to
comply with any filing requirements relating to any such taxes. This provision
shall not be deemed to affect the party responsible for any such filing or any
tax liability.
(b) Notwithstanding any provision in an Assigned Contract with
respect to the timing for payment of taxes by the Sellers, all real property
taxes, personal property taxes and similar ad valorem obligations levied with
respect to the Acquired Assets for a taxable period which includes (but does not
end on) the Closing Date shall be apportioned between the Sellers and the Buyer
based on the number of days of such taxable period which fall on or before the
Closing Date (a "Pre-Closing Tax Period") and the number of days of such taxable
period after the Closing Date (a "Post-Closing Tax Period"). The Sellers shall
be liable for the proportionate amount of such taxes that is attributable to the
Pre-Closing Tax Period, and with respect to Assigned Contracts, such amounts
shall be included in the Cure Amounts, and the Buyer shall be liable for the
proportionate amount of such taxes that is attributable to the Post-Closing Tax
Period.
(c) The Buyer agrees (i) to retain all books and records with
respect to tax matters acquired pursuant to this Agreement ("Tax Records") until
the expiration of the applicable statute of limitations (including any
extensions thereof), and to abide by all record retention agreements entered
into with any taxing authority, and (ii) to give the Sellers reasonable written
notice prior to destroying or discarding any such Tax Records and, if the
Sellers so request, to allow the Sellers to take possession of such Tax Records
to be discarded or destroyed. The Buyer further agrees to permit the Sellers and
its representatives to have access (upon reasonable notice and at reasonable
business hours, and in a manner so as not to interfere with the normal business
operations of the Buyer) to all Tax Records. The Sellers agree to provide
corresponding rights to the Buyer with respect to any tax-related records
retained by the Sellers.
(d) In accordance with Section 1146(c) of the Bankruptcy Code,
the transfer of the Acquired Assets to the Buyer and the making, execution,
delivery or recordation of any deed, termination or modification of any lease or
other instrument of transfer or assignment executed in connection with any of
the transactions contemplated in connection with this Agreement shall be exempt
from (i) taxation under any federal, state or local law imposing a sales, stamp,
transfer or other similar tax, and (ii) any state or local filing or notice
requirements related to bulk transfers or bulk sales.
(e) The Buyer may, at its election, make an election under
Section 338 of the Internal Revenue Code relating to the Acquired Assets. The
Sellers shall make such filings, cooperate with the Buyer in any filings, and
take such other actions reasonably necessary or appropriate to accomplish such
an election by the Buyer.
6.7 Purchase of Returned Inventory. From and after the 180 Day
Anniversary, Buyer, prior to placing any purchase orders for Inventory of the
type included in the Returned Inventory with outside suppliers to support then
current customer purchase orders, shall first place such
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purchase orders to Sellers for the purchase of the Returned Inventory, at the
lower of cost or fair market value.
ARTICLE VII
TERMINATION
7.1 Termination of Agreement. The Parties may terminate this Agreement
prior to the Closing (whether before or after the entry of the Approval Order)
with the prior authorization of their respective Boards of Directors, as
provided below:
(a) the Parties may terminate this Agreement by mutual written
consent;
(b) the Buyer may terminate this Agreement by giving written
notice to the Sellers in the event the Sellers are in material breach of any
representation, warranty, or covenant contained in this Agreement, and the
Sellers may terminate this Agreement by giving written notice to the Buyer in
the event the Buyer is in material breach of any representation, warranty, or
covenant contained in this Agreement; provided, however, that in the case of any
breach by any Party, the Party in breach shall have five business days after
written notice thereof in which to cure such breach (as to any breach that is
capable of being cured);
(c) the Buyer may terminate this Agreement by giving written
notice to the Sellers if the Closing shall not have occurred on or before
February 15, 2002 by reason of the failure of any condition precedent under
Section 5.1 hereof (unless the failure results primarily from a breach by the
Buyer of any representation, warranty or covenant contained in this Agreement);
(d) the Sellers may terminate this Agreement by giving written
notice to the Buyer if the Closing shall not have occurred on or before March
15, 2002 by reason of the failure of any condition precedent under Section 5.2
hereof (unless the failure results primarily from a breach by the Sellers of any
representation, warranty or covenant contained in this Agreement);
(e) [unused];
(f) the Buyer may terminate this Agreement by giving written
notice to the Sellers if the Bankruptcy Court has not entered either the
Approval Order or the Assignment Order on or before December 6, 2001;
(g) the Buyer may terminate this Agreement by giving written
notice to the Sellers if a motion to dismiss the Bankruptcy Case or a motion to
convert the Bankruptcy Case or appoint a trustee or examiner has been granted in
the Bankruptcy Case;
(h) the Sellers may terminate this Agreement by giving written
notice to the Buyer if the Bankruptcy Court approves an Alternative Proposal;
(i) the Buyer may terminate this Agreement by giving written
notice to the Sellers if the Sellers fail to file the Approval Motion and the
Provision Motion as provided in Section 4.4 hereof; and
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(j) the Buyer or the Sellers may terminate this Agreement by
giving five (5) days' written notice to the other Parties in the event that any
condition to the obligations of such terminating Party to close as set forth in
Section 5.1 or 5.2 hereof, as the case may be, becomes incapable of being
satisfied (and is not susceptible to cure).
7.2 Effect of Termination. If this Agreement is terminated pursuant to
Section 7.1, all obligations of the Parties hereunder shall terminate without
any liability on the part of the Buyer to the Sellers or the Sellers to the
Buyer, as the case may be, except as set forth below in this Section 7.2 or in
Section 8.1; provided, however, that the confidentiality provisions contained in
Section 4.6 shall survive such termination and the provisions of Section 4.10
(Cost Reimbursement) shall survive any such termination (other than a
termination by the Sellers pursuant to Section 7.1(b)). In the event of any
breach by the Buyer of any of the terms and conditions of this Agreement for
which the Sellers have the right to terminate this Agreement pursuant to Section
7.1(b) hereof, the Sellers' sole and exclusive remedy shall be to terminate this
Agreement, in which event the Deposit shall become the property of the Sellers'
bankruptcy estate (the "Liquidated Damages Amount"). Other than payment of the
Liquidated Damages Amount, the Sellers shall have no claim against the Buyer for
any breach by the Buyer of any of the terms and conditions of this Agreement or
in the event that the Sellers terminate this Agreement in accordance with
Section 7.1(b) of this Agreement. If the Sellers terminate this Agreement for
any reason other than in accordance with Section 7.1(b), within 5 days the
Escrow Agent shall return the Deposit to the Buyer, and the Sellers shall have
no claim against the Buyer due to such termination. If the Buyer terminates this
Agreement in accordance with any subsection of Section 7.1, the Escrow Agent
shall within 5 days return the Deposit to the Buyer. If the Buyer terminates
this Agreement in accordance with Section 7.1(b), the Buyer shall be entitled to
pursue all available remedies at law or in equity.
ARTICLE VIII
INDEMNIFICATION
8.1 Indemnification.
(a) The Sellers shall indemnify the Buyer in respect of, and hold
the Buyer harmless against, any and all debts, obligations and other liabilities
(whether absolute, accrued, contingent, fixed or otherwise, or whether known or
unknown, or due or to become due or otherwise), monetary damages, fines, fees,
penalties, interest obligations, deficiencies, losses and expenses (including
without limitation amounts paid in settlement, interest, court costs, reasonable
fees and expenses of attorneys, accountants, financial advisors and other
experts, and other reasonable expenses of litigation) net of any insurance
proceeds (less any deductibles) actually received ("Damages") incurred or
suffered by the Buyer or any affiliate thereof resulting from, relating to or
constituting:
(i) any misrepresentation, breach of representation or
warranty or failure to perform any covenant or agreement of the Sellers, in each
case contained in this Agreement or in any Ancillary Agreement;
(ii) any Retained Liabilities; and
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(iii) any liability arising out of the Prior Agreement and/or
the Seller's bidding and sale process initiated pursuant to the Prior Agreement
or court order (other than any liability resulting solely from Buyer's actions).
(b) The Buyer shall indemnify the Sellers in respect of, and hold
the Sellers harmless against, any and all Damages incurred or suffered by the
Sellers or any affiliate thereof resulting from, relating to or constituting:
(i) any misrepresentation, breach of representation or
warranty or failure to perform any covenant or agreement of the Buyer in this
Agreement or in any Ancillary Agreement; or
(ii) any Assumed Liabilities.
8.2 Method of Asserting Claims.
(a) All claims for indemnification by any indemnified party
pursuant to this Article VIII shall be made in accordance with the provisions of
this Section 8.2.
(b) If a third party asserts that an indemnified party is liable to
such third party for a monetary or other obligation which may constitute or
result in Damages for which the indemnified party may be entitled to
indemnification pursuant to this Article VIII, and the indemnified party
reasonably determines that it has a valid business reason to fulfill such
obligation, then (i) the indemnified party shall be entitled to satisfy such
obligation, (ii) the indemnified party may make a claim for indemnification
pursuant to this Article VIII, and (iii) the indemnified party shall be
reimbursed for any such Damages for which it is entitled to indemnification
pursuant to this Article VIII.
(c) The indemnified party shall give prompt written notification to
the indemnifying party of the commencement of any action, suit or proceeding
relating to a third party claim for which indemnification pursuant to this
Article VIII may be sought. Within 20 days after delivery of such notification,
the indemnifying party may, upon written notice thereof to the indemnified
party, assume control of the defense of such action, suit or proceeding with
counsel reasonably satisfactory to the indemnified party, provided each
indemnifying party acknowledges in writing to the indemnified party that any
damages, fines, costs or other liabilities that may be assessed against the
indemnified party in connection with such action, suit or proceeding constitute
Damages for which the indemnified party shall be entitled to indemnification
pursuant to this Article VIII. If no indemnifying party so assumes control of
such defense, the indemnified party shall control such defense. The party not
controlling such defense may participate therein at its own expense; provided
that if the indemnifying party assumes control of such defense and the
indemnified party reasonably concludes that the indemnifying party and the
indemnified party have conflicting interests or different defenses available
with respect to such action, suit or proceeding, the reasonable fees and
expenses of counsel to the indemnified party shall be considered "Damages" for
purposes of this Agreement. The party controlling such defense shall keep the
other party advised of the status of such action, suit or proceeding and the
defense thereof and shall consider in good faith recommendations made by the
other party with respect thereto. The indemnified party shall not agree to any
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settlement of such action, suit or proceeding without the prior written consent
of each indemnifying party, which shall not be unreasonably withheld. No
indemnifying party shall agree to any settlement of such action, suit or
proceeding without the prior written consent of each indemnified party, which
shall not be unreasonably withheld.
8.3 Threshold. Notwithstanding anything contained herein to the
contrary except the second sentence of this Section 8.3, neither the Sellers nor
the Buyer shall be obligated to make any indemnification payments under this
Agreement (other than indemnification for willful breaches of covenants, fraud,
Retained Liabilities (including, without limitation, any Cisco Claims or in
connection with the storage or removal of the Cisco Inventory, the Nokia
Inventory, the ATT Inventory or the Other Inventory), Assumed Liabilities or a
Party's failure to make the Purchase Price Adjustment Wire) unless and until the
aggregate Damages sustained by the Buyer and its affiliates or the Sellers and
their affiliates, as the case may be, exceed on a cumulative basis $400,000 (the
"Threshold"), at which point the Sellers or the Buyer (as applicable) shall be
obligated to indemnify the Buyer and its affiliates or the Sellers and their
affiliates (as applicable) from and against all Damages in excess of the
Threshold. The Sellers acknowledge and agree that there shall be no Threshold
with respect to any claims for indemnification by the Buyer and its affiliates
relating in any way to the Foreign Entities or any of the operations thereof.
8.4 Indemnification Escrow. The Parties agree that (i) all claims for
indemnification by the Buyer against the Sellers (or any of them or their
affiliates) hereunder made by the Buyer following the Closing shall be solely
satisfied by the Buyer by recourse against the Indemnity Escrow Amount and (ii)
all claims for indemnification by the Sellers against the Buyer (or any
affiliate) hereunder made by the Seller shall not exceed $2,000,000, in the
aggregate (it being acknowledged and agreed that in no event shall the Sellers
be entitled to any claims for indemnification in the event that the Sellers have
received the Liquidated Damages Amount).
8.5 Consequential Damages. Notwithstanding anything contained herein to
the contrary, none of the Buyer, the Sellers or their respective affiliates will
be entitled to any recovery under this Agreement for their own special,
punitive, consequential, incidental or indirect damages or lost profits, it
being acknowledged that the Sellers' recovery of Liquidated Damages in
accordance with Section 7.2 shall not be prohibited hereby; provided, however,
that nothing herein shall prevent any of such parties from being indemnified for
all components of awards against them in claims by third parties, including
special, punitive, consequential, incidental or indirect damages or lost profits
components of such claims.
8.6 Exclusive Remedy. The remedies set forth in this Agreement shall be
the sole and exclusive remedy with respect to any and all claims relating,
directly or indirectly, to the subject mater of this Agreement or any Ancillary
Agreements (except for fraud or liability for Retained Liabilities or the
Assumed Liabilities). Without limiting the generality of the foregoing and
subject to Article VII, each party hereby waives, to the fullest extent
permitted under applicable law, any and all rights, claims and causes of action
it or any of its affiliates may have against the other parties or any of their
affiliates with respect to the subject matter of this Agreement or any Ancillary
Agreement, whether arising under or based upon any Federal, state, provincial,
local or foreign statute, law, ordinance, rule, regulation or common law (except
as specifically provided for herein).
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8.7 Treatment of Indemnity Payments. Any payment made to the Buyer
pursuant to this Article shall be treated as a reduction in the Purchase Price.
8.8 Survival. The representations, warranties, covenants and agreements
of the Sellers set forth in this Agreement shall survive the Closing and the
consummation of the transactions contemplated hereby and continue until the date
which is twelve (12) months from the Closing hereunder ("Indemnification
Termination Date"). The representations, warranties, covenants and agreements of
the Buyer set forth in this Agreement shall survive the Closing and the
consummation of the transactions contemplated hereby and continue until the
Indemnification Termination Date except for such covenants of the Buyer or the
Sellers contained in this Agreement that are to be performed after the
Indemnification Termination Date which shall survive until the applicable statue
of limitations relating thereto has expired.
ARTICLE IX
MISCELLANEOUS
9.1 Press Releases and Announcements. No Party shall issue any press
release or announcement relating to the subject matter of this Agreement without
the prior approval of the other Parties; provided, however, that any Party may
make any public disclosure that, upon the advice of legal counsel, is required
by law or regulation, or NASDAQ Stock Market rule, to be made (in which case the
disclosing Party shall advise the other Parties and provide it with a copy of
the proposed disclosure prior to making the disclosure).
9.2 No Third Party Beneficiaries. This Agreement shall not confer any
rights or remedies upon any person other than the Parties and their respective
successors and permitted assigns and the parties to the Executive Employment
Agreements in connection with the Buyer's obligations under Section 1.8 hereof.
9.3 Entire Agreement. This Agreement (including the documents referred
to herein, including, without limitation, the Confidentiality Agreement)
constitutes the entire agreement between the Parties and supersedes any prior
understandings, agreements, or representations by or between the Parties,
written or oral, that may have related in any way to the subject matter hereof.
9.4 Succession and Assignment. This Agreement shall be binding upon and
inure to the benefit of the Parties named herein and their respective successors
and permitted assigns. No Party may assign either this Agreement or any of its
rights, interests, or obligations hereunder without the prior written approval
of the other Parties; provided that the Buyer may assign all or any portion of
its rights, interests and/or obligations hereunder to one or more wholly owned
subsidiaries of the Buyer, provided that the Buyer remains primarily liable
therefor, and the Buyer may assign or grant a security interest to its lender in
its rights in this Agreement.
9.5 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
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9.6 Headings. The section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
9.7 Notices. All notices, requests, demands, claims, and other
communications hereunder shall be in writing. Any notice, request, demand,
claim, or other communication hereunder shall be deemed duly delivered two
business days after it is sent by registered or certified mail, return receipt
requested, postage prepaid, or one business day after it is sent via a reputable
nationwide overnight courier service, in each case to the intended recipient as
set forth below:
If to the Sellers: MCMS, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Copy to: ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ Flics, Esq.
If to the Buyer: Plexus Corp
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Copy to: ▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Any Party may give any notice, request, demand, claim, or other communication
hereunder using any other means (including personal delivery, expedited courier,
messenger service, telecopy, telex, ordinary mail, or electronic mail), but no
such notice, request, demand, claim, or other communication shall be deemed to
have been duly given unless and until it actually is received by the individual
for whom it is intended. Either Party may change the address to which notices,
requests, demands, claims, and other communications hereunder are to be
delivered by giving the other Party notice in the manner herein set forth.
9.8 Governing Law. Except to the extent governed by the federal
bankruptcy law, this Agreement shall be governed by and construed in accordance
with the internal laws (and not the law of conflicts) of the State of Delaware.
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9.9 Amendments and Waivers. The Parties may mutually amend any
provision of this Agreement at any time prior to the Closing; provided, however,
that any amendment effected subsequent to the Approval Order shall be subject to
the restrictions contained in the Approval Order. No amendment of any provision
of this Agreement shall be valid unless the same shall be in writing and signed
by all of the Parties. No waiver by any Party of any default, misrepresentation,
or breach of warranty or covenant hereunder, whether intentional or not, shall
be deemed to extend to any prior or subsequent default, misrepresentation, or
breach of warranty or covenant hereunder or affect in any way any rights arising
by virtue of any prior or subsequent such occurrence.
9.10 Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction shall not affect
the validity or enforceability of the remaining terms and provisions hereof or
the validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction. If the final judgment of a court of
competent jurisdiction declares that any term or provision hereof is invalid or
unenforceable, the Parties agree that the court making the determination of
invalidity or unenforceability shall have the power to reduce the scope,
duration, or area of the term or provision, to delete specific words or phrases,
or to replace any invalid or unenforceable term or provision with a term or
provision that is valid and enforceable and that comes closest to expressing the
intention of the invalid or unenforceable term or provision, and this Agreement
shall be enforceable as so modified after the expiration of the time within
which the judgment may be appealed.
9.11 Expenses. Each Party shall bear its own costs and expenses
(including legal fees and expenses) incurred in connection with this Agreement
and the transactions contemplated hereby; provided that this Section 9.11 shall
not be deemed to affect the Buyer's right to be paid the Breakup Fee and other
rights in this Agreement. The Seller shall pay any sales taxes, stamp taxes,
real estate transfer fees and similar governmental taxes, charges or other fees
required by the conveyance of the Acquired Assets, change in control of the
Foreign Entities and/or the other actions contemplated by this Agreement, and
shall be responsible for making any related filing.
9.12 Specific Performance. Each Party acknowledges and agrees that the
other Parties would be damaged irreparably in the event any of the provisions of
this Agreement are not performed in accordance with their specific terms or
otherwise are breached. Accordingly, each Party agrees that the other Parties
shall be entitled to an injunction or injunctions to prevent breaches of the
provisions of this Agreement and to enforce specifically this Agreement and the
terms and provisions hereof in any action instituted in the United States
Bankruptcy Court for the District of Delaware, in addition to any other remedy
to which it may be entitled, at law or in equity.
9.13 Survival of Representations. Except as specifically provided for
in this Agreement, none of the representations and warranties made by the
Parties herein or the documents or certificates contemplated hereby, nor the
covenants set forth in Article IV hereof, shall survive the Indemnification
Termination Date.
9.14 Construction. The language used in this Agreement shall be deemed
to be the language chosen by the Parties hereto to express their mutual intent,
and no rule of strict construction shall be applied against any Party. Any
reference to any federal, state, local, or
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foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise.
Accounting terms not otherwise defined herein shall have the meanings assigned
to the by generally accepted accounting principles consistently applied in the
United States of America as promulgated by the Financial Accounting Standards
Board.
9.15 Incorporation of Exhibits and Schedules. The Exhibits and
Schedules identified in this Agreement are incorporated herein by reference and
made a part hereof.
9.16 Bulk Sales Laws. The Buyer and the Sellers each hereby waive
compliance by Sellers with the provisions of the "bulk sales", "bulk transfer"
or similar laws of any state.
ARTICLE X
DEFINITIONS
For purposes of this Agreement, the following terms shall have the respective
meanings set forth below:
10.1 "Accrued Employee Liabilities" shall have the meaning set forth in
Section 1.2(a)(vi) of this Agreement.
10.2 "Acquired Assets" shall have the meaning set forth in Section
1.1(a) of this Agreement.
10.3 "Additional Receivables" shall have the meaning set forth in
Section 6.2 of this Agreement.
10.4 "Agreement" shall have the meaning set forth in the first
paragraph of this Agreement.
10.5 "Alternative Proposal" shall have the meaning set forth in
Sections 4.8 of this Agreement.
10.6 "Ancillary Agreements" shall have the meaning set forth in Section
1.1(b)(ii) of this Agreement.
10.7 "Approval Motion" shall have the meaning set forth in Section
4.4(a) of this Agreement.
10.8 "Approval Order" shall have the meaning set forth in Section
4.4(a) of this Agreement.
10.9 "Assigned Contracts and Leases" shall have the meaning set forth
in Section 1.1(a)(iv) of this Agreement.
10.10 "Assignment Order" shall have the meaning set forth in Section
4.4(c) of this Agreement.
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10.11 "Assumed Employee Liabilities" shall have the meaning set forth
in Section 1.2(a)(vii) of this Agreement.
10.12 "Assumed Liabilities" shall have the meaning set forth in Section
1.2(a) of this Agreement.
10.13 "Assumed Payables" shall have the meaning set forth in Section
1.2(a)(iii) of this Agreement.
10.14 "Assumed Warranty Obligations" shall have the meaning set forth
in Section 1.2(a)(i).
10.15 "ATT" shall have the meaning set forth in Section 1.1(a)(i)(B) of
this Agreement.
10.16 "ATT Inventory" shall have the meaning set forth in Section
1.1(a)(i)(B) of this Agreement.
10.17 "Bankruptcy Case" shall have the meaning set forth in the first
recital of this Agreement.
10.18 "Bankruptcy Code" shall have the meaning set forth in the first
recital of this Agreement.
10.19 "Bankruptcy Court" shall have the meaning set forth in the first
recital of this Agreement.
10.20 "Belgian Entities" shall have the meaning set forth in Section
1.1(b)(vi) of this Agreement.
10.21 "Breakup Fee" shall have the meaning set forth in Section 4.10 of
this Agreement.
10.22 "Buyer" shall have the meaning set forth in the first paragraph
of this Agreement.
10.23 "Buyer Plans" shall have the meaning set forth in Section 6.1(b)
of this Agreement.
10.24 "Cancellation Fees" shall have the meaning set forth in Section
1.4(b)(vii) of this Agreement.
10.25 "CERCLA" shall have the meaning set forth in Section 2.15(f)(i)
of this Agreement.
10.26 "Chapter 11 Case" shall have the meaning set forth in the first
recital of this Agreement.
10.27 "Cisco" shall have the meaning set forth in Section 1.1(a)(i)(B)
of this Agreement.
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10.28 "Cisco Claims" shall have the meaning set forth in Section
4.17(a) of this Agreement.
10.29 "Cisco Inventory" shall have the meaning set forth in Section
1.1(a)(i)(B) of this Agreement.
10.30 "Cisco/Nokia/ATT Accounts Receivable" shall have the meaning set
forth in Section 1.1(a)(ix) of this Agreement.
10.31 "Cisco/Nokia Plan" shall have the meaning set forth in Section
4.17(a) of this Agreement.
10.32 "Closing" shall have the meaning set forth in Section 1.5(a) of
this Agreement.
10.33 "Closing Amounts Certificate" shall have the meaning set forth in
Section 1.6(a) of this Agreement.
10.34 "Closing Date" shall have the meaning set forth in Section 1.5(a)
of this Agreement.
10.35 "Confidentiality Agreement" shall have the meaning set forth in
Section 4.6 of this Agreement.
10.36 "Continuing Employees" shall have the meaning set forth in
Section 1.2(a)(vi) of this Agreement.
10.37 "Cost Reimbursement Claim" shall have the meaning set forth in
Section 4.10(b) of this Agreement.
10.38 "Cure Amounts" shall have the meaning set forth in Section 4.4(c)
of this Agreement, and shall include without limitation the amounts described in
Section 6.6(b) of this Agreement.
10.39 "Damages" shall have the meaning set forth in Sections 8.1(a) of
this Agreement.
10.40 "Deposit" shall have the meaning set forth in Section 1.3(a) of
this Agreement.
10.41 "Differences" shall have the meaning set forth in Section 1.6(a)
of this Agreement.
10.42 "DOJ" shall have the meaning set forth in Section 4.3 of this
Agreement.
10.43 "Enforceability Exceptions" shall have the meaning set forth in
Section 2.2 of this Agreement.
10.44 "Environmental Laws" shall have the meaning set forth in Section
2.15(f)(i) of this Agreement.
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10.45 "Escrow Agent" shall have the meaning set forth in Section
1.5(b)(iv) of this Agreement.
10.46 "Escrow Agreement" shall have the meaning set forth in Section
1.5(b)(iv) of this Agreement.
10.47 "Escrow Amount" shall have the meaning set forth in Section
1.4(c) of this Agreement.
10.48 "Estimated Amounts Certificate" shall have the meaning set forth
in Section 1.4(a) of this Agreement.
10.49 "Estimated Purchase Price Adjustment" shall have the meaning set
forth in Section 1.4(b) of this Agreement.
10.50 "Estimated Quality Inventory Amount" shall have the meaning set
forth in Section 1.6(c)(v) of this Agreement.
10.51 "Excess Receivables Amount" shall have the meaning set forth in
Section 1.6(b)(iii) of this Agreement.
10.52 "Exchange Act" shall have the meaning set forth in Section 3.3 of
this Agreement.
10.53 "Excluded Assets" shall have the meaning set forth in Sections
1.1(b) of this Agreement.
10.54 "Exclusivity Period" shall have the meaning set forth in Section
4.8 (a) of this Agreement.
10.55 "Exclusivity Provision" shall have the meaning set forth in
Section 4.8 (b) of this Agreement.
10.56 "Executive Employment Agreements" shall have the meaning set
forth in Section 1.8 of this Agreement.
10.57 "Executive Severance Payments" shall have the meaning set forth
in Section 1.8 of this Agreement.
10.58 "Facilities" shall have the meaning set forth in Section
1.2(b)(vii) of this Agreement.
10.59 "Filing Date" shall have the meaning set forth in the first
recital of this Agreement.
10.60 "Final Closing Amounts Certificate" shall have the meaning set
forth in Section 1.6(a) of this Agreement.
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10.61 "Final Inventory Certificate" shall have the meaning set forth in
Section 1.6A(a) of this Agreement.
10.62 "Final Quality Inventory Amount" shall have the meaning set forth
in Section 1.6(c)(v) of this Agreement.
10.63 "Financial Statements" shall have the meaning set forth in
Section 2.4(a) of this Agreement.
10.64 "Foreign Entities" shall have the meaning set forth in the first
paragraph of this Agreement.
10.65 "Foreign Entities Audit" shall have the meaning set forth in
Section 2.4(a) of this Agreement.
10.66 "Foreign Entity Inter-Company Payables" shall have the meaning
set forth in Section 1.4(b)(iv) of this Agreement.
10.67 "Foreign Entity Inter-Company Receivables" shall have the meaning
set forth in Section 1.4(b)(iv) of this Agreement.
10.68 "Foreign Entity Net Current Assets" shall have the meaning set
forth in Section 1.4(b)(iv) of this Agreement.
10.69 "FTC" shall have the meaning set forth in Section 4.3 of this
Agreement.
10.70 "Governmental Entity" shall have the meaning set forth in Section
1.1(a)(vii) of this Agreement.
10.71 "Hazardous Substances" shall have the meaning set forth in
Section 1.5(f)(ii) of this Agreement.
10.72 "Imputed Inventory Value" shall mean, at the Sellers' option,
with respect to relevant items of raw material, either (a) the lower of current
fair market value or the cost of acquisition of items of raw material, or (b)
88.5% of the cost of acquisition of items of raw material. The Seller shall
choose a single option described above as to all relevant items.
10.73 "Included Current Assets" shall have the meaning set forth in
Section 1.1(a)(x) of this Agreement.
10.74 "Included Receivables" shall have the meaning set forth in
Section 1.1(a)(ix) of this Agreement.
10.75 "Indemnification Termination Date" shall have the meaning set
forth in Section 8.8 of this Agreement.
10.76 "Indemnity Escrow Amount" shall have the meaning set forth in
Section 1.4(c)(iii) of this Agreement.
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10.77 "Initial Bidder" shall mean MSL Midwest Operations, Inc.
10.78 "Intellectual Property" shall have the meaning set forth in
Section 1.1(a)(iii) of this Agreement.
10.79 "Intellectual Property Listing" shall have the meaning set forth
in Section 1.1(a)(iii) of this Agreement.
10.80 "Inventory" shall have the meaning set forth in Section 1.1(a)(1)
of this Agreement.
10.81 "Inventory Adjustment Amount" shall have the meaning set forth in
Section 1.6A(b) of this Agreement.
10.82 "Inventory Certificate" shall have the meaning set forth in
Section 1.6A(a) of this Agreement.
10.83 "Inventory Escrow Amount" shall have the meaning set forth in
Section 1.4(c)(iv) of this Agreement.
10.84 "Leased Real Property" shall have the meaning set forth in
Section 1.1(a)(iv) of this Agreement.
10.85 "Leases" shall have the meaning set forth in Section 2.14 of this
Agreement.
10.86 "Liquidated Damages Amount" shall have the meaning set forth in
Section 7.2 of this Agreement.
10.87 "Malaysian Loan" shall have the meaning set forth in Section
2.4(b) of this Agreement.
10.88 "Material Adverse Effect" shall mean any change or effect that is
or is reasonably likely to be material and adverse to (i) the Acquired Assets
and Assumed Liabilities, taken as a whole or (ii) the ability of the Sellers to
transfer to the Buyer the Acquired Assets or the Assigned Contracts and Leases,
in each case other than any change or effect arising out of (a) any change in
the economy of the United States or the other markets in which the Sellers or
the Subsidiaries operate, or generally in the industry in which the Sellers or
the Subsidiaries operate, (b) the loss of customers as disclosed in the Public
Filings, or (c) this Agreement or the transactions contemplated hereby,
including filing the Chapter 11 Cases and the events and circumstances that
result therefrom, or the announcement or pendency of any of the actions
contemplated by this clause (c).
10.89 "MCMS" shall have the meaning set forth in the first paragraph of
this Agreement.
10.90 "MCMS Asia Pacific" shall have the meaning set forth in Section
2.11 of this Agreement.
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10.91 "MCMS China" shall have the meaning set forth in the first
paragraph of this Agreement.
10.92 "MCMS Customer Services" shall have the meaning set forth in the
first paragraph of this Agreement.
10.93 "MCMS Holdings" shall have the meaning set forth in the first
recital of this Agreement.
10.94 "MCMS International" shall have the meaning set forth in the
first paragraph of this Agreement.
10.95 "MCMS Malaysia" shall have the meaning set forth in the first
paragraph of this Agreement.
10.96 "MCMS Mexico" shall have the meaning set forth in Section 2.11 of
this Agreement.
10.97 "MCMS Plan" shall have the meaning set forth in Section 1.8 of
this Agreement.
10.98 "MCMS Singapore" shall have the meaning set forth in Section 2.11
of this Agreement.
10.99 "Mexican Entities" shall have the meaning set forth in Section
1.1(b)(iv) of this Agreement.
10.100 "Multiemployer Plan" shall have the meaning set forth in Section
1.2(b)(xi) of this Agreement.
10.101 "Net Working Capital" shall have the meaning set forth in
Section 1.6(b)(ii)(B) of this Agreement.
10.102 "Net Working Capital Target" shall have the meaning set forth in
Section 1.4(b)(ii) of this Agreement.
10.103 "Neutral Auditor" shall have the meaning set forth in Section
1.6(a) of this Agreement.
10.104 "Nokia" shall have the meaning set forth in Section 1.1(a)(i)(B)
of this Agreement.
10.105 "Nokia Inventory" shall have the meaning set forth in Section
1.1(a)(i)(B) of this Agreement.
10.106 "Non-Quality Inventory" shall have the meaning set forth in
Section 1.1(a)(i)(B) of this Agreement.
10.107 "Obsolete Inventory" shall mean Inventory which (a) is not
supported by or subject to use under either (i) valid customer purchase orders
which are Assigned Contracts and
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Leases placed with the Sellers or Foreign Entities prior to the Closing; or (ii)
to be manufactured based upon demand forecasts supplied prior to Closing by
customers that are party to contracts that are Assigned Contracts and Leases or
otherwise have previously established an ongoing customer relationship with the
Sellers or Foreign Entities; and (b) which customers are not bound under
Assigned Contracts and Leases to purchase from the Buyer at not less than the
cost thereof. "Obsolete Inventory" is neither Quality Inventory nor Non-Quality
Inventory.
10.108 "OIRR" shall have the meaning set forth in Section 4.5 of this
Agreement.
10.109 "180 Day Anniversary" shall have the meaning set forth in
Section 1.6A(a) of this Agreement.
10.110 "Other Inventory" shall have the meaning set forth in Section
4.17(b) of this Agreement.
10.111 "Owned Real Property" shall have the meaning set forth in
Section 1.1(a)(v) of this Agreement.
10.112 "Parties" shall have the meaning set forth in the first
paragraph of this Agreement.
10.113 "Permits" shall have the meaning set forth in Section
1.1(a)(vii)of this Agreement.
10.114 "Plan Escrow Amount" shall have the meaning set forth in Section
1.4(c)(ii) of this Agreement.
10.115 "Post-Closing Tax Period" shall have the meaning set forth in
Section 6.6(b) of this Agreement.
10.116 "Pre-Closing Tax Period" shall have the meaning set forth in
Section 6.6(b) of this Agreement.
10.117 "Preliminary Purchase Price" shall have the meaning set forth in
Section 1.3(a) of this Agreement.
10.118 "Prior Agreement" shall mean the Asset Purchase Agreement among
the Sellers, other subsidiaries of MCMS and the Initial Bidder dated September
18, 2001.
10.119 "Provision Motion" shall have the meaning set forth in Section
4.4(a) of this Agreement.
10.120 "Provision Order" shall have the meaning set forth in Section
4.4(a) of this Agreement.
10.121 "Public Filings" shall have the meaning set forth in Section
2.4(c) of this Agreement.
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10.122 "Purchase Price" shall have the meaning set forth in Section
1.3(a) of this Agreement.
10.123 "Purchase Price Adjustment Amount" shall have the meaning set
forth in Section 1.6(b) of this Agreement.
10.124 "Purchase Price Adjustment Wire" shall have the meaning set
forth in Section 1.6(c)(i)(B) of this Agreement.
10.125 "Quality Inventory" shall have the meaning set forth in Section
1.4(b)(iii) of this Agreement.
10.126 "Retained Liabilities" shall have the meaning set forth in
Section 1.2(b) of this Agreement.
10.127 "Retained Receivables" shall have the meaning set forth in
Section 1.1(b)(iv) of this Agreement.
10.128 "Retention Plan" shall have the meaning set forth in Section 1.8
of this Agreement.
10.129 "Retention Plan Payment" shall have the meaning set forth in
Section 1.8 of this Agreement.
10.130 "Returned Inventory" shall have the meaning set forth in Section
1.6A(d) of this Agreement.
10.131 "Schedules" shall have the meaning set forth in the first
paragraph of Article II hereof.
10.132 "Security Interest" shall have the meaning set forth in Section
2.5 of this Agreement.
10.133 "Sellers" shall have the meaning set forth in the first
paragraph of this Agreement.
10.134 "Subsidiary" shall have the meaning set forth in Section 2.1 of
this Agreement.
10.135 "Threshold" shall have the meaning set forth in Section 8.3 of
this Agreement.
10.136 "Title Policy" shall have the meaning set forth in Section
5.1(p) of this Agreement.
10.137 "U.S. Entities" shall have the meaning set forth in the first
recital of this Agreement.
10.138 "U.S. GAAP" shall have the meaning set forth in Section 2.4(a)
of this Agreement.
10.139 "Value" shall have the meaning set forth in Section 1.3(a) of
this Agreement.
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10.140 "Work in Process" shall have the meaning set forth in Section
2.4(b)(vi) of this Agreement.
[Signature pages follow]
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
date first above written.
PLEXUS CORP.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: VP - Mergers and Acquisitions
(Signature Page to Asset Purchase Agreement)
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
date first above written.
MCMS, Inc.
By: ▇▇▇▇▇ ▇▇▇▇▇
Title: Executive VP Finance & CFO
MCMS Customer Services, Inc.
By: ▇▇▇▇▇ ▇▇▇▇▇
Title: President
MCMS International, B.V.
By: ▇▇▇▇▇ ▇▇▇▇▇
Title: Director
(Signature Page to Asset Purchase Agreement)
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
date first above written.
MCMS Electronics (Xiamen) Co., Ltd.
By: ▇▇▇▇▇ ▇▇▇▇▇
Title: Director
M.C.M.S. Sdn. Bhd.
By: ▇▇▇▇▇ ▇▇▇▇▇
Title: Director
(Signature Page to Asset Purchase Agreement)
LIST OF EXHIBITS AND SCHEDULES
Exhibit A - Form of Approval Order
Schedule 1.1(a)(ii) - Fixed Asset Property Listing
Schedule 1.1(a)(iii) - Intellectual Property Listing
Schedule 1.1(a)(iv)(A) - Assigned Contracts and Leases
Schedule 1.1(a)(iv)(B) - Contracts and Leases not to be Assigned
Schedule 1.1(a)(v) - Owned Real Property
Schedule 1.1(a)(ix) - Mexico Current Assets
Schedule 1.1(a)(x) - Included Current Assets
Schedule 1.1(b)(ix) - Retained Litigation
Schedule 1.1(b)(xviii) - Excluded Assets
Schedule 1.3A - Severance Adjustment
Schedule 1.3B - Further Severance Adjustment
Schedule 1.4(b)(ii) - Certain Actions to be Taken
Schedule 1.8 - Executive Employment Agreements
Schedule 2.1 - Organizational Chart
Schedule 2.3 - Non-Contravention (as to Sellers)
Schedule 2.4(b) - Financial Statements; Absence of Certain Changes
Schedule 2.5 - Ownership and Condition of Assets
Schedule 2.6(a) - Intellectual Property Disclosures
Schedule 2.6(b) - Complaints re: Intellectual Property
Schedule 2.7 - Assigned Contracts and Leases Disclosures
Schedule 2.8 - Litigation
Schedule 2.9 - Legal Compliance
Schedule 2.10 - Customers and Suppliers
Schedule 2.11(A) - Subsidiary Ownership
Schedule 2.11(B) - Subsidiary Ownership
Schedule 2.13 - Owned Real Property Disclosures
Schedule 2.14 - Lease Disclosures
Schedule 2.15 - Environmental
Schedule 2.16 - Permits
Schedule 3.3 - Non-Contravention (as to Buyer)
Schedule 4.9 - Customer to be Approached
Schedule 4.13 - Continuing Employees
Schedule 5.1(k) - Legal Opinions
Schedule 5.1(l) - Key Customers
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