Exhibit 2.2
AGREEMENT REGARDING PURCHASE OF CERTAIN ASSETS FROM
AEROVOX INCORPORATED AND AEROVOX DE MEXICO
I. PARTIES.
A. Buyer: Nueva Generacion Manufacturas S.A. de C.V., a Mexican
corporation ("Buyer").
▇. ▇▇▇▇▇▇▇: Aerovox, Incorporated ("Aerovox") and Aerovox de Mexico, S.A.
de C.V. ("Aerovox Mexico" and, together with Aerovox, the "Seller").
II. ASSETS TO BE PURCHASED.
A. Subject to the terms and conditions hereof, Aerovox Mexico or Aerovox,
as the case may be, shall sell and Buyer shall purchase, all right,
title and interest of such parties in and to the following assets
(collectively, the "Assets"):
1. Aerovox Mexico Assets. Except for the "Excluded Assets" (as
defined in Paragraph B of this Section II), all assets and
properties owned by Aerovox Mexico at the time of "Closing" (as
defined below) and located at its facility at Tezozomoc 239 y
San Antonio, Atzcapotzalco, Mexico, D.F. 02760 (the "Mexico City
Facility") (collectively, the "Aerovox Mexico Assets"),
including, without limitation, all of the assets and properties
located at the Mexico City Facility which are reflected on the
"Initial Statement" (as defined in Section VII(B) below), or
acquired by Aerovox Mexico subsequent to the date of the Initial
Statement (the "Initial Statement Date") other than Excluded
Assets and any assets or properties disposed of by Aerovox
Mexico in the ordinary course of business after the Initial
Statement Date. The Aerovox Mexico Assets shall include, without
limitation, the following:
a) All inventory (including raw materials, work-in-process,
finished goods and other inventory items) owned by Aerovox
Mexico at Closing and located at the Mexico City Facility
(collectively, the "Mexico City Inventory");
b) All machinery, equipment, fixtures and construction in
progress owned by Aerovox Mexico at Closing and located at
the Mexico City Facility, as well as any and all warranty
and other contract rights of Aerovox Mexico with respect
to the foregoing;
c) All accounts receivable owned by Aerovox Mexico (excluding
intercompany accounts receivable) resulting solely from
the sale of goods manufactured at the Mexico City Facility
that are outstanding at the time of Closing;
d) All prepaid expenses, deposits, refunds (excluding tax
refunds), claims, rights of set-off, causes of action,
rights of recovery and rights of recoupment owned by
Aerovox Mexico which relate solely to the operation of the
Mexico City Facility (the "Mexico City Operations");
e) All information technology systems owned by Aerovox Mexico
and located at the Mexico City Facility, as well as any
and all warranty and other contract rights of Aerovox
Mexico with respect to the foregoing;
f) All of the customer agreements, sales representative
agreements, supply agreements, equipment leases, real
property leases, license agreements and other contracts
and agreements to which Aerovox Mexico is a party
identified on Exhibit A hereto;
g) All patents, patent applications, trade secrets,
technology, know-how, inventions, processes, technical
information and data, tools and dies, designs, plans,
drawings, diagrams, schematics and other proprietary
information and intellectual property owned by Aerovox
Mexico and used solely in connection with the Mexico City
Operations;
h) The "CGE" trademark, together with all goodwill associated
therewith (with any transfer or documentation costs or
expenses related to such transfer to be paid by Buyer);
and
i) All customer lists and data, marketing plans and
documents, advertising, sales and promotional materials,
marketing studies and reports and other documents and
materials owned by Aerovox Mexico and relating solely to
those products produced at the Mexico City Facility which
are not produced at Seller's Juarez, Mexico, or New
Bedford, Massachusetts manufacturing facility.
2. Aerovox Assets. Only the following specific assets and
properties of Aerovox:
a) All motor start capacitor inventory owned by Aerovox at
Closing and (i) on consignment to Whirlpool and located at
or in transit to its facilities at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
or (ii) on consignment to Tecumseh and located at or in
transit to M.B. ▇▇▇▇▇, Inc., ▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇ (collectively, the "Consignment Inventory" and
together with the Mexico City Inventory the "Inventory");
b) The following machinery and equipment: (i) an Arcotronics
6-paper winding machine model # AVE263B and Serial No.
PM263.170C owned by Aerovox and located at the Juarez,
Mexico facility (Buyer shall be responsible for crating
and shipping such machine and for any associated expenses
and any taxes, duties or other fees and expenses imposed
or incurred related to the purchase of such machine); and
(ii) all machinery and equipment owned by Aerovox which is
leased by Aerovox to Aerovox Mexico and located at the
Mexico City Facility (collectively, together with the
machinery, equipment and other assets described in
Sections II(A)(1)(b) above, the "Equipment"), as well as
any and all warranty and other contract rights of Aerovox
with respect
to any of the foregoing;
c) All of the equipment leases, license agreements and other
contracts and agreements to which Aerovox is a party
relating solely to the Mexico City Operations and
identified on Exhibit B hereto, said Exhibit to be
completed, agreed upon by the parties and attached hereto
on or before April 26, 2002 (collectively, together with
the contracts and agreements listed on Exhibit A hereto,
the "Acquired Contracts");
d) All patents, patent applications, trade secrets,
technology, know-how, inventions, processes, technical
information and data, tools and dies, designs, plans,
drawings, diagrams, schematics and other proprietary
information and intellectual property owned by Aerovox and
used solely in the production of those products produced
at the Mexico City Facility which are not produced at any
other manufacturing facility owned by Seller or its
subsidiaries or affiliates (with any transfer or
documentation costs or expenses related to such transfer
to be paid by Buyer); and
e) All customer lists and data, marketing plans and
documents, advertising, sales and promotional materials,
marketing studies and reports and other documents and
materials owned by Aerovox and relating solely to those
those products produced at the Mexico City Facility which
are not produced at Seller's Juarez, Mexico, or New
Bedford, Massachusetts manufacturing facility.
B. Notwithstanding the foregoing, the Assets shall not include any of the
following (collectively, the "Excluded Assets"): (a) any and all assets of
Aerovox which arespecifically listed in Section II(A)(2), (b) cash and
cash equivalents of Aerovox Mexico; (b) all rights of Aerovox Mexico to or
claims for refunds or rebates of any taxes (including, without limitation,
any such matters related to Value Added Tax, i.e. IVA) for any period
prior to the Closing Date, and the benefit of net operating loss
carryforwards, carrybacks or other credits of Seller relating to any such
period (collectively, the "Recoverable Tax Assets"); (c) any and all
assets of Seller located at the Juarez, Mexico facility (except for the
winding machine specifically referenced above), (d) all intercompany
accounts or notes receivable (e) all insurance claims and policies of
Seller relating to the Mexico City Operations, (f) any rights of the
Seller under any contract or agreement which is not an Acquired Contract,
and (g) any and all trademarks, service marks, product names, trade names
of Seller other than the CGE trademark, whether or not related to the
Mexico City Operations, including, without limitation., "CGE Aerovox",
"Aerovox", "Aeromet", Supermet", "Blue ▇▇▇▇" or any combination or
derivation thereof.
C. The Buyer agrees and acknowledges that (a) the Buyer's decision to proceed
with the transactions contemplated by this Agreement is based upon the
Buyer's own inspection and investigation of the Assets and the business of
Seller; (b) the Buyer is familiar with the Assets and the business of
Seller and has been afforded the full
opportunity, to the extent it desired to do so, to fully inspect and
review (i) the books and records of Seller, (ii) the title to the
Assets, (iii) such other operational and financial information as the
Buyer has found appropriate including, without limitation, any
survey, appraisal, environmental, engineering, sales, production or
employment matters, and (c) the Buyer is satisfied with each of the
foregoing matters, and will, at Closing, acquire the Assets without
representation or warranty of any kind, express or implied. This
provision shall survive the Closing or early termination of this
Agreement.
III. AGREEMENTS REGARDING THE CGE AEROVOX TRADEMARK.
For a period of 12 months following the Closing, Buyer shall have a
non-exclusive, fully paid right and license to use the CGE Aerovox
trademark owned and to be retained by Seller in connection with the
acquired business and in the manner in which such trademark is
presently used. Seller agrees (A) that it will not assign sell or
transfer the CGE Aerovox trademark to any person or entity, (B) that it
will not, at any time after the Closing, use the CGE Aerovox trademark
for any purpose or in any manner, and (C) that the restrictions set
forth in this sentence shall survive the Closing and the expiration of
the term of the license set forth in the preceding sentence
indefinitely.
IV. PURCHASE PRICE.
A. The purchase price for the Assets ("Purchase Price") shall be TWO
MILLION, FIVE HUNDRED FIFTY THOUSAND DOLLARS ($2,550,000) (subject
to adjustment as provided in Article VII below), in United States
Dollars payable by wire transfer of immediately available funds as
provided in Article VI below
B. At Closing, the cash portion of the Purchase Price shall be
allocated between and among the Assets owned by Aerovox and
between and among the Assets owned by Aerovox Mexico as provided
on Exhibit C hereto.
V. ASSUMPTION OF LIABILITIES; PERMITTED ENCUMBRANCES.
A. At Closing, Buyer shall assume the following liabilities and
obligations of Seller (collectively, the "Assumed Liabilities"):
1. All liabilities and obligations of the Aerovox Mexico
(excluding intercompany liabilities and obligations and
liabilities for the payment of taxes) relating
exclusively to the Mexico City Operations arising prior
to the Closing of the transactions contemplated hereby;
2. All obligations of the Seller under the Acquired
Contracts, whether arising prior to or following the
Closing of the transactions contemplated hereby;
3. The obligations of Aerovox Mexico at Closing with respect
to that certain loan from Banco Bilbao Vizcaya ("BBV") to
Aerovox Mexico, S.A de C.V. in the original principal
amount of $1,000,000 (the "BBV Loan"); and
4. All liabilities of Aerovox Mexico for payroll and related
employee benefits in respect of any employee of the
Mexico City Operations relating to periods or for
services provided prior to the "Closing Date" (as defined
below), including, without limitation, any accrued and
unpaid vacation, bonuses, sick time, or personal time,
which in all cases shall be paid or afforded by Buyer to
such employees in the ordinary course of business,
provided, however, Aerovox Mexico shall remain
responsible for the payment obligations, if any, with
respect to employee profit sharing, as required by law
(i.e. PTU).
B. Buyer acknowledges and agrees that it is purchasing the Assets
subject to the following liens, liabilities and encumbrances
(collectively, the "Permitted Encumbrances"): (1) the terms of all
Acquired Contracts and other Assumed Liabilities, and (2) all
liens and security interests on those Assets being acquired from
Seller existing as of the date hereof in favor of BBV which secure
the BBV Loan.
C. Notwithstanding the foregoing, Buyer is not assuming, and shall
not be liable or responsible for any of the following
(collectively, the "Retained Liabilities"): (1) any intercompany
liabilities of any nature, or (2) any liability or obligation of
the Seller for the payment of taxes (except as provided in Section
VI(D)); or (3) any liability of Seller which is covered by
insurance; or (4) any other liability or obligation of Seller of
any nature other than those expressly described in Section V(A) or
V(B) above.
D. Buyer shall be solely responsible for payment of any and all Value
Added Tax (i.e. IVA) and any duties (if any) payable to any
governmental authority in connection with the sale of the Assets
to the Buyer hereunder.
VI. PAYMENT TERMS.
A. Upon execution of this Agreement, Buyer shall provide a deposit of
$300,000 US Dollars (the "Deposit") to the law firm of ▇▇▇▇▇▇ &
King, P.C., as escrow agent (the "Escrow Agent"), to be held in an
interest bearing account by the Escrow Agent pending the Closing,
and applied to the Purchase Price upon Closing or otherwise
administered and distributed by the Escrow Agent in accordance
with the provisions of the Escrow Agreement attached hereto as
Exhibit D and hereby made a part hereof (the "Escrow Agreement").
Failure on the part of Buyer to close in accordance with the terms
of this Agreement as a result of Buyer's breach of such terms
shall result in the Buyer forfeiting the deposit in full
satisfaction of any claims Seller may have against Buyer resulting
from Buyer's breach.
B. The balance of the cash portion of the Purchase Price ($2,250,000
in US Dollars) shall be paid to Seller at Closing by wire transfer
of immediately available funds in US Dollars.
C. Any amounts due from either party as a result of any "Purchase
Price Adjustment" (as hereinafter defined) pursuant to Section VII
below shall be payable in accordance with the provisions of
Section VII(F) below.
VII. PURCHASE PRICE ADJUSTMENT.
A. For purposes of this Section VII, the following terms shall have the
following meanings, and any reference to an amount shall be in US
Dollars, converted at a rate of 9.1 Mexican Pesos to 1.00 US Dollar:
(1) "Mexico City Working Capital" shall mean the total amount of
Mexico City Assets less the total amount of Mexico City
Liabilities.
(2) "Mexico City Assets" shall mean the gross amount of accounts
receivable (excluding intercompany receivables), the gross amount
of Inventory (measured at the same unit costs as were in effect on
February 23, 2002), the acquisition value of the Equipment and
construction in progress, prepaid expenses and other current
assets of the Mexico City Operations, but excluding cash and
Recoverable Tax Assets.
(3) "Mexico City Liabilities" shall mean all accounts payable and
accrued expenses of the Mexico City Operations, incurred in the
ordinary course of business of Aerovox Mexico, excluding
intercompany accounts payable and liabilities for the payment of
taxes.
B. Attached hereto as Exhibit E is an unaudited statement of the Mexico
City Working Capital, as of February 23, 2002, prepared by Aerovox in
accordance with generally accepted accounting principles consistently
applied by Aerovox ("Initial Statement").
C. Within ten (10) business days after the Closing Date (which period may
be extended by not more than five (5) additional business days by
Aerovox by providing written notice to Buyer ) Aerovox shall prepare
and deliver to Buyer an unaudited final statement of Mexico City
Working Capital as of 12:01 a.m. on the Closing Date, prepared in a
manner consistent with the methods employed by Aerovox in the
preparation of the Initial Statement ("Final Statement").
D. Subject to the provisions of this Section, the Purchase Price will be
increased or decreased (as the case may be) (the "Purchase Price
Adjustment") as follows:
(1) If the Mexico City Working Capital reflected on the Final
Statement is greater than the Mexico City Working Capital
reflected on the Initial Statement the Purchase Price shall be
increased by an amount equal to such excess.
(2) If the Mexico City Working Capital reflected on the Final
Statement is less than the Mexico City Working Capital reflected
on the Initial Statement the Purchase Price shall be decreased by
an amount equal to such deficiency.
E. During the period between the Closing Date and the delivery of the
Final Statement and any objection period, Buyer shall provide Aerovox
with reasonable access to the books and records of the Mexico City
Operations as may be necessary to complete
the Final Statement. Buyer shall have ten (10) business days following
delivery of the Final Statement to (y) review the Final Statement and
the business records with respect thereto and (z) deliver written
objections, if any, in reasonable detail to Aerovox. If no written
objections are delivered to Aerovox within said time period, the Final
Statement shall be considered final and binding on the parties for all
purposes. If written objections are so delivered by Buyer, the parties
shall, for a period of ten (10) business days following delivery of
Buyer's written objection attempt in good faith to resolve their
differences with respect to such objections. Any resolution of such
objections by the parties shall be in writing and shall be final and
binding on the parties for all purposes. If the parties are unable to
resolve any objections within such time frame, to mutually agree to
extend the time allowed, or to resolve such objections within any
extended period of time, the matter will be submitted to Aerovox's
Bankruptcy Court for final and binding resolution.
F. When the terms of the Final Statement become final and binding on the
parties the amount of the Purchase Price Adjustment shall be
calculated and any amount due to a party shall be paid promptly by the
appropriate party by wire transfer in immediately available US
Dollars, but in no event later than ten (10) days after the Final
Statement becomes final and binding on the parties.
G. During the period from the date hereof until the Closing Date, neither
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ nor Aerovox shall cause Aerovox Mexico to (a)
sell or otherwise remove (or cause to be sold or otherwise removed)
from the Mexico City Facility any of the Assets located at the Mexico
City Facility without the prior written consent of the Buyer and
Aerovox, except for sales of Inventory in the ordinary course of
business; or make accounting adjustments to or write-off any of the
Assets located at the Mexico City Facility without the prior written
consent of Aerovox and Buyer, except for normal recurring accounting
entries. The results of any action taken by any party in violation of
this paragraph shall not be reflected in the purchase price adjustment
described in this Section VII.
VIII. COVENANTS OF SELLER.
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A. Forthwith upon the effective date of this agreement ("Agreement"),
Aerovox shall file and serve, in accordance with all applicable
statutes, rules and laws relating to the filing and service of,
1. A motion in form and substance satisfactory to Buyer and its counsel
approving sale procedures, including, without limitation,
(a) approving the terms and conditions of sale set forth in this
Agreement, including, without limitation, the payment by Seller to
Buyer of a break up fee in the amount of Fifty Thousand ($50,000)
Dollars in accordance with the provisions of this Agreement should the
Closing not occur because of the acceptance by Seller of a higher
offer and the successful consummation of such transaction; and
(b) establishing (i) the form of notice for the "Sale Motion" (as
defined below), which notice shall be in form and substance reasonably
satisfactory to
Buyer and its counsel, (ii) a deadline for filing and serving
objections to the Sale Motion and (iii) a date for a hearing on the
Sale Motion;
2. A motion in form and substance reasonably satisfactory to Buyer and
its counsel seeking authority under 11 U.S.C. ss.363(f) to sell the
Assets owned by Aerovox to Buyer free and clear of any and all claims,
liens, interests or encumbrances in the Assets owned by Aerovox ("Sale
Motion"). The Sale Motion shall seek entry of an order ("Sale Order"),
in form and substance reasonably satisfactory to Buyer and its
counsel, allowing such motion, and containing such other provisions as
reasonably requested by Buyer, including, without limitation,
(a) a finding that Buyer is purchasing the Assets owned by Aerovox in
good faith and is thereby entitled to the maximum protection available
to good faith purchasers provided in 11 U.S.C.ss.363(m);
(b) authorizing, empowering and directing Aerovox to perform all acts,
execute and deliver all documents, that are reasonably necessary,
proper or desirable as requested by Buyer to implement and consummate
the purchase and sale contemplated by this Agreement, all without
further order of the court or notice to any entities;
(c) determining that the Assets owned by Aerovox are property of
Aerovox's bankruptcy estate and that upon consummation of the purchase
and sale contemplated by this Agreement Buyer shall have good and
marketable title to all of the Assets owned by Aerovox free and clear
of any and all competing claims, interests, liens and encumbrances;
and
(d) determining that Aerovox is authorized and empowered to execute
and deliver documents on behalf of the Aerovox bankruptcy estate, and
to perform acts on behalf of the estate to consummate and perform
Aerovox's obligations to sell the Assets owned by Aerovox to Buyer,
all without further order of the Court or notice to any entity
whatsoever.
3. All other necessary and proper notices, motions and other papers
reasonably required to obtain entry of the Sale Order, including,
without limitation, a notice of intended sale pursuant to
Fed.R.Bankr.P. 6004, in form and substance reasonably satisfactory to
counsel for the Buyer, but in no event shall this Section be construed
to require Aerovox to take action to appeal the entry of any Order of
the Aerovox Bankruptcy Court.
B. Until the consummation of the transactions contemplated by this
Agreement (the "Transaction") or termination of this Agreement, Seller
will afford to Buyer and its agents, investment bankers, accountants,
and other representatives working on the Transaction free and full
access to its offices, properties, books, and records, will permit
them to make extracts from and copies of such books and records, and
will from time to time furnish them with such additional financial and
operating data and other information as to its financial condition,
results of operations,
business, properties, assets, liabilities, or future prospects as
they from time to time may request.
C. Seller agrees that, until the consummation of the Transaction or
termination of this Agreement, Seller will use its best efforts
to preserve substantially intact Mexico City Operations and the
assets relating thereto and conduct the Mexico City Operations in
all respects only in the ordinary course unless otherwise
consented to in writing by the Buyer; provided, however, that
Seller shall not be responsible or liable for any breach of this
paragraph resulting from any action or failure to act by ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ Aldunate or anyone under the direction or control of
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇.
D. At the Closing, Seller shall either (a) execute, deliver and
enter into an IT Network Access Agreement with Buyer in form and
substance reasonably acceptable to the parties hereto (the "IT
Network Access Agreement"); or (b) if the assets comprising
Seller's information technology and computer network currently
employed at the Mexico City Facility (the "Aerovox IT Network")
have been sold to Parallax Power Components, Inc. or another
buyer prior to the Closing, cause Parallax or such other
purchaser of such assets to execute, deliver and enter into the
IT Network Access Agreement with Buyer. If the assets comprising
the Aerovox IT Network have not been sold to Parallax or another
buyer prior to the Closing, Seller shall require as a condition
of any sale of such assets that the purchaser thereof assume and
agree to perform Seller's obligations under the IT Network Access
Agreement. The parties shall use reasonable efforts to determine
and agree upon the terms, conditions, form and substance of the
IT Network Access Agreement on or before April 26, 2002.
E. Seller shall not be permitted to sell the Assets to any other
entity other than Buyer unless Seller timely receives a "Higher
Offer" (as defined below) or this Agreement is otherwise
terminated prior to Closing in accordance with the provisions of
Section XV below. If prior to Closing Seller timely receives a
Higher Offer, then Seller shall (a) provide Buyer with written
notice of its receipt of such Higher Offer and the terms thereof,
accompanied by a copy of such Higher Offer, within two (2)
business days following its receipt of such Higher Offer; and (b)
provide Buyer and any entity timely submitting a Higher Offer
with a reasonable opportunity to submit additional offers to
purchase the Assets prior to accepting such Higher Offer pursuant
to the provisions of Massachusetts Local Bankruptcy Rule
6004-1(a)(1)(B). For purposes of this Agreement, the term "Higher
Offer" shall mean an offer to buy all of the Assets for a lump
sum cash payment at least five percent (5%) greater than the
aggregate value of the Purchase Price, and otherwise containing
all of the terms and conditions of this Agreement. The Assets may
not be sold piecemeal, but may only be sold, consistently with
the transaction contemplated in this Agreement, as a package.
IX. CONDITIONS PRECEDENT TO EFFECTIVENESS OF AGREEMENT.
This Agreement shall become effective only upon satisfaction of the
following condition: Payment of the Deposit by Buyer.
X. CONDITIONS TO CLOSING.
A. Buyer's obligation to consummate the Transaction is subject to the
following conditions:
1. The Sale Order shall have been entered, and shall not have
been stayed, modified or reversed as of the Closing date;
2. Seller shall have complied in all material respects with its
obligations under this Agreement;
3. There shall have been no material adverse change in the
business, financial condition or operations of the Mexico
City Operations or the condition of the Assets (provided,
however, that it is understood and agreed that a material
adverse change resulting from any intentional action or
omission by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or anyone acting under
his direction or control shall not be considered a material
adverse change for purposes of this paragraph);
4. Receipt of written approval from BBV of the assignment to
and assumption by Buyer of the BBV Loan, without
acceleration of any amount due under the BBV Loan or any
requirement of the payment of any penalty, fee or similar
payment to BBV on account of the BBV Loan or any other
material modification of the terms of the BBV Loan;
5. As of the Closing Date, there shall be no security interests
or liens of any nature whatsoever on or affecting any of the
Assets other than: (a) Permitted Encumbrances; or (b) any
other liens or security interests granted to or obtained by
third parties after the date hereof with the knowledge and
consent of, or as a result of the actions of, ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ Aldunate; and
6. Seller shall have executed, delivered and entered into the
IT Network Access Agreement or, if the assets comprising the
Aerovox IT Network have been sold to Parallax or another
purchaser prior to the Closing, Parallax or such other
purchaser of said assets shall have executed, delivered and
entered into the IT Network Access Agreement. In addition,
if the assets comprising the Aerovox IT Network have not
been sold as of the Closing Date but Seller has entered into
an agreement with Parallax or another purchaser for the sale
of such assets, Seller shall have demonstrated to the
reasonable satisfaction of Buyer that such agreement
contains provisions in form and substance reasonably
acceptable to Buyer requiring as a condition of such sale
that the purchaser thereof assume the IT Network Access
Agreement with Buyer and agree to perform Seller's
obligations thereunder;
7. Seller shall execute and deliver to Buyer an Assignment and
Assumption Agreement with respect to the Acquired Contracts
and the other Assumed Liabilities in a form reasonably
acceptable to the parties.
B. Seller's obligation to consummate the Transaction is subject to the
following conditions:
1. Entry of the Sale Order;
2. Payment of the balance of the Purchase Price;
3. The Buyer shall have complied in all material respects with
its obligations under this Agreement;
4. The Buyer shall have obtained and delivered to Seller (a)
the written approval from BBV of the assignment to and
assumption by Buyer of the BBV Loan, without acceleration of
any amount due under the BBV Loan or requirement of payment
of any amount to BBV on account of the BBV Loan or
otherwise; and (b) the full and complete release by BBV of
Seller from any and all liability under or related to the
BBV Loan;
5. If required pursuant to the provisions of Section XII
hereof, Buyer shall have executed, delivered and entered
into a Mutual Noncompetition Agreement with the buyer of the
"Remaining Assets" of Aerovox (as defined in Section XII
hereof), the form and substance of which will be agreed upon
in writing by the parties on or before April 26, 2002.
6. Delivery by Buyer for cancellation of the original
Promissory Note dated __________ and payable by Aerovox,
Inc. to ______________ (the "Noteholder") in the original
principal amount of $_____________;
7. Buyer shall have caused the Noteholder to (a) instruct the
escrow agent holding of the original stock certificate for
___ shares of capital stock of Aerovox Mexico securing the
repayment of the Promissory Note referred to in the
preceding paragraph to release such stock certificate to
Seller; and (b) cancel the related pledge agreement;
8. Buyer shall execute and deliver to Seller an Assignment and
Assumption Agreement with respect to the Acquired Contracts
and the other Assumed Liabilities in a form reasonably
acceptable to the parties; and
9. Buyer shall deliver to Seller the Employer Substitution
Agreements in form and substance reasonably acceptable to
the parties and customary for transactions of this nature.
XI. RELEASES.
A. At (and subject to the occurrence of) the Closing of the sale of
the Assets contemplated by this Agreement, Buyer, Hobir Holdings,
B.V., Kato Holdings, B.V., ▇▇▇▇▇ Investments, B.V., Kasri Holding,
B.V., Tako Holding, B.V., ▇▇▇▇▇ Investments, B.V., Compania General
de Electronica, S.A. de C.V., Inmobiliaria Industrial S.A. de C.V.
and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and their respective affiliates,
partners, subsidiaries, heirs, administrators, executors, past and
present officers, directors, shareholders, agents, attorneys,
employees, predecessors, successors and assigns (the
"Buyer Parties") shall, and hereby do, remise, release and
forever discharge Seller and their affiliates, partners,
subsidiaries, past and present officers, directors, shareholders,
agents, attorneys, employees, predecessors, successors and
assigns (the "Seller Parties") of and from all claims, causes of
action, suits, charges, complaints, debts, sums of money,
promises, demands, actions, accounts, covenants, contracts,
agreements, damages, and all liabilities of every kind, nature,
or description, direct or indirect, known or unknown, matured or
not matured, liquidated or unliquidated, fixed or contingent,
whether arising at law or in equity which the Buyer Parties ever
had, now have or which they may have in the future against the
Seller Parties with respect to matters arising from the beginning
of the World to the time of Closing of the transactions
contemplated hereby; provided, however, that the foregoing does
not apply to or operate as a release with respect to any of the
following: (i) any right of indemnification or right to insurance
coverage or proceeds that ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Aldunate may be
entitled to, if any, as a result of his having served as a
Director or officer of Aerovox or Aerovox Mexico, whether
pursuant to the Certificate of Incorporation or By-Laws of
Aerovox, applicable law, agreement or otherwise; or (ii) any
obligation or liability of the Seller or any right or remedy of
the Buyer pursuant to this Agreement or any of the documents,
instruments or agreements executed by the parties in connection
herewith.
B. At (and subject to the occurrence of) the Closing of the sale
of the Assets contemplated by this Agreement, the Seller Parties
shall, and hereby do, remise, release and forever discharge the
Buyer Parties of and from all claims, causes of action, suits,
charges, complaints, debts, sums of money, promises, demands,
actions, accounts, covenants, contracts, agreements, damages, and
all liabilities of every kind, nature, or description, direct or
indirect, known or unknown, matured or not matured, liquidated or
unliquidated, fixed or contingent, whether arising at law or in
equity which the Seller Parties ever had, now have or which they
may have in the future against the Buyer Parties with respect to
matters arising from the beginning of the World to the time of
Closing of the transactions contemplated hereby; provided,
however, that the foregoing does not apply to or operate as a
release with respect to (i) any defense that may exist with
respect to claims for indemnification or insurance by ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, as a result of his having served as a Director
or officer of Aerovox or Aerovox Mexico, whether pursuant to the
Certificate of Incorporation or By-Laws of Aerovox, applicable
law, agreement or otherwise, and (ii) any obligation or liability
of the Buyer or any right or remedy of the Seller pursuant to
this Agreement or any of the documents, instruments or agreements
executed by the parties in connection herewith.
XII. ANCILLARY MATTERS.
A. If during the period from February 23,2002, through the Closing
Date Seller receives any claims or complaints relating to
products sold by Seller which were manufactured at the Mexico
City Facility ("Customer Claims"), Seller shall refer all such
Customer Claims to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Aldunate for handling. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall have sole and exclusive authority to
negotiate, resolve and settle all such Customer Claims, provided
that prior to entering into any binding agreement to resolve or
settle any Customer Claim he obtains approval thereof from ▇▇▇▇▇▇
▇▇▇▇▇▇▇ or F. ▇▇▇▇▇▇
▇▇▇▇ on behalf of Aerovox, which approval shall not be unreasonably
withheld or delayed.
B. Upon request of Seller in order to facilitate the consummation of the
sale by Aerovox of its remaining assets (other than the Assets and the
stock of B.H.C. Aerovox Ltd.) (the "Remaining Assets"), Buyer and
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Aldunate shall enter into a Mutual Noncompetition
Agreement with the purchaser of the Remaining Assets in form and
substance reasonably acceptable to the parties hereto and the
purchaser of the Remaining Assets (the "Mutual Noncompetition
Agreement"); provided, however, that Buyer shall not be required to
execute or enter into the Mutual Noncompetition Agreement unless the
purchaser of the Remaining Assets executes and enters into the Mutual
Noncompetition Agreement. The parties shall use reasonable efforts to
determine and agree upon the scope, terms and conditions, and form and
substance of the Mutual Noncompetition Agreement on or before April
26, 2002.
C. Subject to the consummation of the transactions contemplated hereby,
Buyer shall indemnify Seller for any and all claims by Compania
General de Electronica S.A. de C.V. and Inmobiliaria Industrial S.A.
de C.V. (collectively, the "Landlord") for breach, rejection or
termination of any of the leases for the premises at which the Mexico
City Facility is located (collectively, the "Leases").
XIII. FOIL SUPPLY AGREEMENT.
For a period of 90 days following the Closing, Aerovox shall supply Buyer
with aluminum foil of the type presently used by Aerovox Mexico in the
Mexico City Operations in a minimum amount of 150,000 square meters of
foil and a maximum amount of 250,000 square meters of foil. Buyer shall
notify Aerovox within 30 days after Court approval of the Sale Order of
its exact foil requirements (including types, amounts and delivery
schedule), but such amount shall not be less than 150,000 square meters of
foil over the 90 day period. If Buyer fails to timely notify Aerovox of
its requirements, Buyer shall not only be responsible for purchase of the
150,000 square meters of foil, but shall also be responsible to purchase
the full amount of 250,000 square meters of foil. The purchase price to be
paid by Buyer in exchange for such foil shall be the price of such product
in effect on February 23, 2002, as set forth on the price list attached
hereto as Exhibit F and hereby made a part hereof, which amounts shall be
payable by Buyer within 30 days after delivery to Buyer of the applicable
product.
XIII. CLOSING.
A. The consummation of the transactions contemplated hereby (the
"Closing") shall occur at the offices of ▇▇▇▇▇▇ & ▇▇▇▇, P.C., ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, on June 18, 2002;
provided, however, that such date of Closing may be extended for an
additional period of ten (10) days to June 28, 2002, upon written
notice from Seller to Buyer to the effect thereof if (and only if) (i)
the Sale Approval Order shall not have been entered by the Bankruptcy
Court on or prior to June 18, 2002 and (ii) all other conditions to
Closing set forth in Article X shall have
been satisfied or waived, or at such other time and place as shall be
mutually agreed to between the parties (the "Closing Date").
B. At the Closing, (a) the Seller and Buyer will execute, acknowledge (if
appropriate), and deliver to the other such instruments of sale,
transfer, conveyance, assignment and assumption, and other documents
and agreements as a party and its counsel may reasonably request in
order to effect the sale, transfer, conveyance and assignment to Buyer
of valid ownership of all of the Assets and consummate the other
transactions and agreements contemplated by this Agreement; and (b)
Seller shall deliver to the Buyer, or otherwise take all reasonable
steps as may be necessary to put the Buyer in possession and control
of, all of the Assets.
XIV. TERMINATION.
A. The Buyer may terminate this Agreement by giving written notice to the
Seller at any time prior to the Closing (1) in the event the Seller
has breached this Agreement in any material respect, or (2) if the
Closing shall not have occurred on or before July 15, 2002 (other than
as a result of a breach of this Agreement by Buyer); or (3) if a
Chapter 11 Trustee is appointed in the bankruptcy proceedings in which
Aerovox is a party or if such bankruptcy is converted for any reason
from a Chapter 11 to a Chapter 7 proceeding; or (4) if the parties
fail to agree in writing on the contents of Exhibit B hereto or the
terms, conditions, form and substance of either the Mutual
Noncompetition Agreement or the IT Network Access Agreement on or
before April 26, 2002, as contemplated by Sections II(A)(2)(c),
VIII(D) and XII(B) above, respectively.
B. The Seller may terminate this Agreement by giving written notice to
the Buyer at any time prior to the Closing (1) in the event the Buyer
has breached this Agreement in any material respect, or (2) in the
event that the Bankruptcy Court authorizes the sale to a bidder
submitting a Higher Offer, provided that prior to Seller's acceptance
of such Higher Offer Buyer is given written notice of Seller's receipt
of such Higher Offer (accompanied by a copy thereof) and a reasonable
opportunity to submit a competing offer to purchase the Assets in
accordance with the provisions of Section VIII(E) above; (3) in the
event the Bankruptcy Court denies the Motion for approval of the Sale
Order; or (4) in the event of the termination of the Purchase and Sale
Agreement between Aerovox and Parallax (or any other party purchasing
the Remaining Assets) relating to the sale of the Remaining Assets
(the "Aerovox Agreement") (i) by the Buyer of the Remaining Assets for
any reason other than a breach by Seller, or (ii) by Seller for any
reason other than by mutual agreement with the proposed purchaser of
the Remaining Assets; or (5) if the Closing shall not have occurred on
or before July 15, 2002 (other than as a result of a breach of this
Agreement by Seller), or (6) if the parties fail to agree in writing
on the contents of Exhibit B hereto or the form and substance of the
Mutual Noncompetition Agreement on or before April 26, 2002, as
contemplated by Sections II(A)(2)(c) and XII(B) above, respectively.
C. In the event of any termination of this Agreement pursuant to this
Section, Seller shall, as soon as reasonably practicable but in any
event within 5 business days
thereafter, return to Buyer the entire $300,000 deposit paid by Buyer
hereunder together with any interest earned thereon, unless such
termination results solely from a breach by Buyer of the provisions of
this Agreement in which event Buyer shall forfeit the deposit in full
satisfaction of any claims Seller may have against Buyer resulting
from Buyer's breach. Thereafter, the rights and obligations of the
parties hereto under this Agreement shall terminate (other than the
provisions related to the treatment of the Deposit) and there shall be
no liability of any party hereto to any other party hereunder (other
than the liability of Seller, if any, for any breach by Seller of this
Agreement) and each party hereto shall bear its own expenses incurred
in connection with the negotiation, preparation, execution and
performance of this Agreement.
D. Subject to Bankruptcy Court approval of the motion described in
Section VIII(A)(1)(a) above, in the event of the termination of this
Agreement by Seller pursuant to Paragraph B(2) above, Seller shall, in
addition to returning Buyer's deposit in accordance with the
provisions of Paragraph C above, pay Buyer a break-up fee equal to
$50,000, which amount shall be payable by wire transfer of immediately
available funds within 5 business days following the effective date of
termination.
XV. MISCELLANEOUS.
A. Following the Closing, Seller shall execute such other and further
documents and agreements as reasonably requested by Buyer to
effectuate and implement the transactions contemplated by this
Agreement.
B. This Agreement is intended to be, and shall be construed as, a
document under seal under the laws of the Commonwealth of
Massachusetts, without regard to its conflicts of laws provisions. Any
disputes arising under this Agreement shall be adjudicated in the
United States Bankruptcy Court for the District of Massachusetts.
C. This Agreement shall not confer any rights or remedies upon any person
or entity other than the parties and their respective successors and
assigns.
D. This Agreement constitutes the entire agreement between the parties
with respect to the subject matter hereof, and supersedes any prior
understandings, agreements, or representations by or between the
parties, written or oral, to the extent they have related in any way
to the subject matter hereof.
E. No amendment, modification or waiver of any provision of this
Agreement shall be valid unless the same shall be in writing and
signed by the Buyer and the Seller or in the case of a waiver, by the
party waiving compliance.
F. Buyer may assign its rights and obligations under this Agreement to
any entity, the majority of the equity of which is owned (directly or
indirectly) by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and/or members of his family,
so long as the Buyer Parties remain responsible for the release of any
claims as provided in Section XI herein.
G. All notices, requests, consents, and other communications under this
Agreement shall be in writing, and shall be delivered by hand or sent
by reputable overnight courier service or electronic facsimile
transmission (with a copy sent by first class mail, postage prepaid)
or mailed by first class certified or registered mail, return receipt
requested, postage prepaid:
If to the Buyer, to
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Aldunate, Gerente General,
Nueva Generacion Manufacturas S.A. de C.V.
Tezozomoc 239 y San Antonio
Atzcapotzalco, Mexico, D.F., 02760
Facsimile No. 011-52-55-53-52-53-85,
with a copy (which shall not constitute notice) to
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.,
▇▇▇▇▇ ▇▇▇▇▇▇ LLP,
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇; and
If to the Seller, to
Aerovox, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
with a copy (which shall not constitute notice), to
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇ & King, P.C.,
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇
Notices provided in accordance with this Section shall be deemed delivered
(i) if personally delivered or sent by electronic facsimile transmission,
when received, or (ii) if sent by overnight courier service, 24 hours after
deposit with such courier service, or (iii) if sent by certified or
registered mail, return receipt requested, 48 hours after deposit in the
mail. 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.
H. Access to Information; Maintenance of Records.
(1) Following the Closing, for a period of the later of (i)
three (3) years after the Closing Date and (ii) the date of
entry of an order of the
Aerovox Bankruptcy Court closing the Aerovox Bankruptcy
Case, or if converted to a case under Chapter 7 of the
Bankruptcy Code, an order of the Bankruptcy Court
closing such case, each party and its representatives
shall have reasonable access to all of the books and
records compiled with respect to the period prior to
the Closing Date relating to the business of Aerovox
Mexico or the Assets, including all information
pertaining to the Acquired Contracts, all employee
records or other personnel and medical records required
by law, legal process or subpoena, in the possession of
the other party to the extent that such access may
reasonably be required by such party in connection with
the Acquired Contracts, or other matters relating to or
affected by the operation of the business of Aerovox
Mexico and the Assets.
(2) Such access shall be afforded by the party in
possession of such books and records upon receipt of
reasonable advance notice and during normal business
hours; provided, however, that: (i) any such access
shall be conducted in such a manner as not to interfere
unreasonably with the operation of the business of any
party; (ii) no party shall be required to take any
action which would constitute a waiver of the
attorney-client privilege; (iii) no party shall be
required to take any action which would reveal
confidential or proprietary information; and (iv) no
party shall be required to supply the other party with
any information which such party is under a legal
obligation not to supply. The applicable party
exercising this right of access shall be solely
responsible for any costs or expenses incurred by it
hereunder.
(3) If the party in possession of such books and records
shall desire to dispose of any such books and records
prior to the expiration of such period, such party
shall, prior to such disposition, give the other party
a reasonable opportunity at such other party's expense,
to segregate and remove such books and records as such
other party may select.
(I) 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.
[SIGNATURE PAGES TO FOLLOW]
IN WITNESS WHEREOF, the parties have executed this Agreement under seal
as of this ___ day of April, 2002
AGREED AND ACCEPTED:
BUYER:
Nueva Generacion Manufacturas S.A. de C.V.
BY/S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Aldunate, President
SELLER:
Aerovox Incorporated
BY/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, President
Aerovox de Mexico, S.A. de C.V.
BY/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, President
(Printed Name and Title)
AGREED AND ACCEPTED WITH RESPECT TO SECTIONS VII(F), XI (A) AND XII(A) ONLY, AND
FOR NO OTHER PURPOSE:
BY/S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Aldunate, individually
AGREED AND ACCEPTED WITH RESPECT TO ARTICLE XI (A) ONLY, AND FOR NO OTHER
PURPOSE:
Hobir Holdings, B.V.
BY/S/▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Its:Legal Representative
Kato Holdings, B.V.
BY/S/▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Its:Legal Representative
▇▇▇▇▇ Investments, B.V.
BY/S/▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Its:Legal Representative
Kasri Holding, B.V.
BY/S/▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Its:Legal Representative
Tako Holding, B.V.
BY/S/▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Its:Legal Representative
▇▇▇▇▇ Investments, B.V.
BY/S/▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Its:Legal Representative
Compania General de Electronica, S.A. de C.V.
BY/S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Its:General Manager
Inmobiliaria Industrial S.A. de C.V
BY/S/▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Its:Legal Representative
Exhibits:
A Aerovox Mexico Contracts and Agreements
B Aerovox Contracts and Agreements
C Allocation of Purchase Price
D Escrow Agreement
E Initial Working Capital Statement
F Foil Price List
EXHIBIT A
AEROVOX MEXICO CONTRACTS AND AGREEMENTS
COMERCIAL CONTRACT WITH:
1.- COVENCA, customer, purchase agreement, April 1999
2.- ▇▇▇▇ MEXICO, customer, purchase agreement, June 2001
3.- OSRAM , customer, purchase agreement, March 2000
5.- TECUMSEH, customer, purchase agreement, July 1998
REPRESENTATIVES AGREEMENTS WITH:
1.- ▇▇ ▇▇▇▇▇ ASSOCIATES, representation agreement, April 1999
2.- ▇. ▇. ▇▇▇▇▇▇▇▇▇, representation agreement, October 1999
3.- ▇▇▇▇▇▇ & ASSOCIATES, representation agreement, Jan. 2001
4.- COVENCA Venezuela, representation agreement, April 1999
REAL STATE CONTRACT WITH:
1.- Compania General de Electronica, lease of the building located on TEZOZOMOC
239, April 1999
2.- Compania General de Electronica, lease of the building located on TOCHTLI
352, April 1999
3.- Compania General de Electronica, for the services of buildings located on:
TEZOZOMOC 239 and TOCHTLI 352, April 1999
4.- INMOBILIARIA INDUSTRIAL lease of the building located on TOCHTLI 368 May
2001.
5.- INMOBILIARIA INDUSTRIAL for the services of buildings located on: TOCHTLI
368 May 2001.
OTHER SERVICES CONTRACTS
1.- MAITEAM, IT equipment yearly service, August 2001
2.- BUFETE ▇▇▇▇▇ ▇▇▇▇, labor litigation firm, Nov. 1995
3.- XEROX, copier maintenance, Jan. 2002
4.- XEROX, copier maintenance, Dec. 2001
5.- BAACNIE, security personnel, Dec. 2001
6.- ALCATEL, switch board yearly maintenance, July 2001
7.- TAMEME, transportation of payroll and cash, March 2000
8.- AGILENT TECHNOLOGIES, equipment calibration, Jan. 2001
EXHIBIT B
None.
EXHIBIT C
ALLOCATION OF PURCHASE PRICE
The purchase price will be allocated to the purchased assets as follows
in sequence:
1. Accounts receivable will be offset by accounts payable and the
outstanding principal balance of the BBV loan. The balance of
accounts receivable greater than the offsets, if any remains,
will represent an allocation of the purchase price.
2. If, after the allocation described in number 1 above, there is
an unallocated balance remaining of the purchase price, the
unallocated purchase price will be allocated to the Consignment
Inventory.
3. If, after the allocation described in number 2 above, there is
an unallocated balance remaining of the purchase price, up to
$270,000 of the unallocated purchase price will be allocated to
the machinery, equipment, fixtures and construction in progress
owned by Aerovox Mexico at Closing and located at the Mexico
City Facility.
4. If, after the allocation described in number 3 above, there is
an unallocated balance remaining of the purchase price, up to
$30,000 of the unallocated purchase price will be allocated to
the machinery, equipment, fixtures and construction in progress
owned by Aerovox at Closing and located at the Mexico City
Facility.
5. If, after the allocation described in number 4 above, there is
an unallocated balance remaining of the purchase price, the
unallocated purchase price will be allocated to the Mexico City
Inventory.
6. If, after the allocation described in number 5 above, there is
an unallocated balance remaining of the purchase price, the
unallocated purchase price will be allocated to Goodwill.
EXHIBIT D
ESCROW AGREEMENT
Escrow Agreement made and entered into by and among Nueva Generacion
Manufacturas S.A. de C.V., a Mexican corporation (the "Buyer"), Aerovox,
Incorporated, a Delaware corporation ("Aerovox"), Aerovox de Mexico, S.A. de
C.V., a Mexican corporation ("Aerovox Mexico" and, together with Aerovox, the
"Seller"), and ▇▇▇▇▇▇ & ▇▇▇▇, P.C., a law firm with offices in Boston,
Massachusetts (the "Escrow Agent").
RECITALS
Buyer and Seller are parties to a certain Agreement Regarding Purchase of
Certain Assets dated of even date herewith (the "Purchase Agreement") providing
for the sale by the Seller to the Buyer of certain assets of the Seller as
therein provided. All capitalized terms not otherwise defined herein shall have
the meanings given to them in the Purchase Agreement.
Section VI(A) of the Purchase Agreement provides for the deposit of
certain monies into escrow by Buyer pursuant to this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereby agree as follows:
1. The Escrow Fund. Simultaneously with the execution of this Agreement,
the Buyer has delivered to the Escrow Agent by certified or bank cashier's check
or wire transfer of funds the sum of Three Hundred Thousand and 00/100
($300,000.00). The Escrow Agent shall deposit such amount in an interest bearing
deposit account at a financial institution of its choice, and disburse same in
accordance with the provisions of this Agreement. Such amount, together with the
earnings thereon, are herein called the "Escrow Fund." It is understood and
agreed that any interest earned in respect of the Escrow Fund shall be taxable
to the Buyer and the Seller in proportion to the total amounts distributed to
each hereunder.
2. Disposition of the Escrow Fund. (a) If the Closing under the Purchase
Agreement occurs, then, at the Closing, the Escrow Agent shall pay the Escrow
Fund to the Seller.
(b) If the Closing under the Purchase Agreement does not take place
because of a material breach by the Buyer of its covenants or obligations under
the Purchase Agreement, and if the Seller is not then in material breach of its
representations, warranties, covenants or obligations under the Purchase
Agreement, then, upon a claim for payment made by the Seller, the Escrow Agent
shall pay the Escrow Fund to the Seller as provided in the Purchase Agreement.
In any other case if the Closing does not occur, then, upon a claim for payment
made by the Buyer, the Escrow Agent shall pay the Escrow Fund to the Buyer. All
claims and payments under this Section 2(b) shall be made in accordance with the
procedures set forth in Section 2(c) below.
(c) In the event of a claim for payment under this Agreement by either the
Seller or the Buyer, the party claiming such payment (the "Claiming Party")
shall give written notice to the other party (the "Other Party") and to the
Escrow Agent stating that the Claiming Party is entitled to payment of the
Escrow Fund in accordance with the provisions hereof and of the Purchase
Agreement. If, within fifteen (15) days after receipt of such notice by the
Escrow Agent and the Other Party, the Escrow Agent does not receive written
notice from the Other Party disputing the Claiming Party's right to payment of
the Escrow Fund, then the Escrow Agent shall promptly pay the Escrow Fund to the
Claiming Party. If, within such fifteen (15) day period, the Escrow Agent
receives written notice from the Other Party disputing the Claiming Party's
right to payment of the Escrow Fund, then the Escrow Agent shall retain the
Escrow Fund until (i) the rights of Buyer and Seller have been determined by
final judgment of a court of competent jurisdiction and the Escrow Agent has
received evidence reasonably satisfactory to it of such final judgment, at which
time the Escrow Agent shall promptly disburse
the Escrow Fund in accordance with such final judgment, or (ii) the Escrow Agent
has received written instructions signed by both the Seller and Buyer as to the
disposition of the Escrow Fund, at which time the Escrow Agent shall promptly
disburse the Escrow Fund in accordance with such written instructions. A final
judgment shall be a judgment as to which the period of time for appealing such
judgment has expired without an appeal having been timely made, or, if an appeal
is timely made, as to which such appeal has been disposed of and there is no
recourse to further appeals.
3. Provisions as to Escrow Agent. (a) The Escrow Agent shall have no
liability to any party on account of any investment of funds in accordance with
this Agreement. In the event of any dispute regarding this Agreement, the Escrow
Agent may deposit the Escrow Fund in an appropriate court and therein commence
an action for interpleader or action of similar nature, and the Escrow Agent
shall cease to have any other obligations or liabilities hereunder with respect
to the funds so deposited. Buyer acknowledges that Escrow Agent is also counsel
to Seller and agrees that Escrow Agent may continue to represent Seller in
connection with the related transaction for all purposes.
(b) The Escrow Agent shall be protected in acting upon any written
notice, statement, certificate, waiver, consent or other instrument or document
which the Escrow Agent believes to be genuine. The Escrow Agent shall not be
liable for any error of judgment, or for any act done or step taken or omitted
in good faith, or for anything which the Escrow Agent may do or refrain from
doing in connection with this Agreement, except that the Escrow Agent shall be
liable for its own willful misconduct or gross negligence. In no event shall the
Escrow Agent be required to account for any funds subsequent to disposition
thereof by the Escrow Agent in accordance with this Agreement.
(c) The Escrow Agent may consult with and obtain advice from legal
counsel
in the event of any dispute or question as to the construction of any of the
provisions of this Agreement or the Escrow Agent's duties hereunder, and the
Escrow Agent shall incur no liability and shall be fully protected in acting in
accordance with the opinion of such counsel.
(d) The Escrow Agent shall not be compensated for its services
hereunder, but shall be reimbursed for any and all out-of-pocket expenses
incurred in connection with its duties hereunder, such reimbursement to be paid
equally by the Buyer and Seller promptly upon written request therefor by the
Escrow Agent.
4. Notice. Any notice or communication required or permitted to be
given under this Agreement shall be given in the manner and at the address set
forth in said Section XVI(G) of the Purchase Agreement. Any such notice or
communication to the Escrow Agent shall be given at the following address:
▇▇▇▇▇▇ & ▇▇▇▇, P.C.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
or at such other address as such Escrow Agent may hereafter designate by written
notice to the Buyer and Seller. Any payment to the Buyer or Seller pursuant to
this Agreement shall be made at the address to which notice is to be given to
such party pursuant to the terms hereof.
5. Miscellaneous. (a) This Agreement shall be construed under and
governed by the laws of the Commonwealth of Massachusetts.
(b) The headings contained in this Agreement are for reference
purposes only, and shall not affect the meaning or interpretation of this
Agreement.
(c) This Agreement may be amended only by a written instrument
signed by all the parties hereto. No provisions of this Agreement may be waived
except by an instrument in writing signed by the party sought to be bound. No
failure or delay by any party in exercising
any right or remedy hereunder shall operate as a waiver thereof, and a waiver of
a particular right or remedy on one occasion shall not be deemed a waiver of any
other right or remedy or a waiver on any subsequent occasion.
(d) This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and assigns.
IN WITNESS WHEREOF, the parties have executed this Escrow Agreement under
seal as of the 18/th/ day of April, 2002.
Nueva Generacion Manufacturas S.A. de C.V.
BY/S/▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------
(Signature)
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, President
--------------------------
(Printed Name and Title)
AEROVOX, INCORPORATED
BY/S/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------
(Signature)
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President and CEO
------------------------------------
(Printed Name and Title)
AEROVOX de MEXICO, S.A. de C.V.
BY/S/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------
(Signature)
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President and CEO
------------------------------------
(Printed Name and Title)
▇▇▇▇▇▇ & ▇▇▇▇, P.C.
BY/S/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------
(Signature)
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------
(Printed Name and Title)
EXHIBIT E
Unaudited Statement of
Mexico City Working Capital
As of February 23, 2002
(Exchange rate of 9.10 pesos to 1.00 U.S. dollar)
Accounts Receivable Gross ($M.N. - pesos) $ 17,352,589
(1103, 1104, 1105, 3107)
Inventories, Gross 30,618,724
(1111, 1113, 1114, 1117, 1119, 1120, 1121, 1122, 1123)
Prepaid Expenses and Other Current Assets 207,886
(1301, 1401)
Recoverable Income Taxes 0
(Not transferable)
Machinery and Equipment, Cost 36,596,600
(1202, 1203, 1204, 1205, 1207, 1208, 1209)
Construction in Progress 46,327
(1206)
Other Assets 0
-------------
Mexico City Assets $ 84,822,126
Accounts Payable (6,936,019)
(2102, 2103)
Accrued Compensation and Related Expenses (664,103)
(2115)
Other Accrued Expenses (1,217,859)
(2104 except for intercompany)
Mexico City Liabilities
-------------
(8,817,981)
Mexico City Working Capital less U.S. inventory, in $M.N. (pesos) $ 76,004,145
Divided by exchange rate 9.10
-------------
Mexico City Working Capital less U.S. inventory, in $U.S. $ 8,352,104
Inventory at, or in transit to, ▇▇▇▇▇ and Whirlpool consignment warehouses 604,670
-------------
Mexico City Working Capital in $U.S. $ 8,956,774
Note: The numbers in parentheses represent the general ledger accounts from the
Mexico City books of original entry that aggregate to the total shown.
EXHIBIT F
FOIL PRICE LIST
CODE ACUTAL DESCRIPTION UNIT ACUTAL PRICE
USD
06239 8VW-415 FV M2 7.53
06210 9LE-140 FV M2 4.69
06136 9LE-165 FV M2 4.69
06221 9LE-185 FV M2 4.69
06220 9VE-220 FV M2 5.50
06180 9VR-185 FV M2 5.00
06196 9VR-250 FV M2 6.45
06149 9VR-280 FV M2 6.45
06198 9VR-325 FV M2 6.45
06178 9VR-340 FV M2 7.00
06222 9VR-360 FV M2 7.00
06145 CATODO 2122 S M2 0.75
06065 TAB 0.20 X 8.00 MM 600 V KG 27.98