ASSET PURCHASE AGREEMENT
between
MEASUREMENT SPECIALTIES, INC.,
a New Jersey corporation,
AMP INCORPORATED,
a Pennsylvania corporation,
and
THE ▇▇▇▇▇▇▇▇ CORPORATION,
a Delaware corporation
Dated as of August 14, 1998
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT ("Agreement") is entered
into as of August 14, 1998, by and between MEASUREMENT SPECIALTIES,
INC., a New Jersey corporation ("Purchaser"), and AMP INCORPORATED,
a Pennsylvania corporation, and The ▇▇▇▇▇▇▇▇ Corporation, a wholly
owned subsidiary of AMP Incorporated. (collectively, the "Seller").
Certain capitalized terms used in this Agreement are defined on
Exhibit A.
RECITALS
WHEREAS, Seller is engaged and has been engaged in a
variety of activities, including the development, manufacture,
marketing and sale of piezoelectric polymer films and sensor
components through its AMP Sensors Division (such activities and
operations being herein referred to as the "Business");
WHEREAS, the parties hereto intend that Seller shall sell
to Purchaser, and Purchaser shall purchase from Seller, certain
tangible and intangible assets of Seller related to the Business,
and Purchaser is willing to assume certain specified liabilities
and obligations of Seller incurred in connection with the Business,
all upon the terms and subject to the conditions set forth in this
Agreement.
AGREEMENT
Purchaser and Seller, intending to be legally bound, agree
as follows:
SECTION 1. SALE AND PURCHASE OF ASSETS
1.1 Sale Of Assets. The Seller shall cause to be
sold, assigned, transferred, conveyed and delivered to the
Purchaser, at the Closing (as defined below), good, valid and
marketable title to the Assets free of any Encumbrances (other
than the Assumed Liabilities) on the terms and subject to the
conditions set forth in this Agreement.
1.2 Purchase Price. As consideration for the sale of the
Assets to the Purchaser:
(a) at the Closing, the Purchaser shall
pay to the Seller, in cash, the amount of three million eight
hundred thousand dollars ($3,800,000).
(b) at the Closing, the Purchaser shall
assume the Assumed Liabilities as set forth in Section 1.7.
1.3 Book Value Adjustment.
(a) Within sixty (60) days after the Closing
Date, the Seller shall deliver or cause its accountants to deliver
to the Purchaser a statement of the "Book Value" of the Business
calculated in the manner set forth in Section 1.3(f)(ii) hereof.
(b) As part of the Seller's determination of the
Book Value, the Seller shall complete a physical inventory of the
fixed assets of the Business and complete a physical inventory of
the inventory of the Business. The Purchaser may, at its option,
participate in such inventory and may, at its option, conduct its
own testing of the fixed assets and inventory
(c) If the Purchaser objects to the Seller's
calculation of the Book Value, then, within fifteen days after
the delivery to the Purchaser of the Book Value Statement, the
Purchaser shall deliver to the Seller a written notice describing
in reasonable detail the Purchaser's objections to the Seller's
calculation of the Book Value (an "Objection Notice"). If the Seller
shall not deliver an Objection Notice to the Seller within such
fifteen-day period, then the Seller's calculation of the Book Value
shall be binding and conclusive on the Purchaser and the Seller. If
the Purchaser delivers an Objection Notice to the Seller, and if the
Purchaser and the Seller are unable to agree upon the calculation of
the Book Value within thirty (30) days after an Objection Notice is
delivered to the Seller, the dispute shall be finally settled by a
mutually acceptable independent accounting firm. The determination
by the independent accounting firm of the Book Value shall be
conclusive and binding on the Purchaser and the Seller. The Seller
and the Purchaser shall each bear and pay 50% of the fees and other
expenses of such independent accounting firm.
(d) If the Book Value is greater than the Base Amount
(as defined below), the Purchaser shall pay to the Seller, in cash,
the amount by which the Book Value exceeds the Base Amount. If the
Book Value is less than the Base Amount, then the amount by which
the Base Amount, exceeds the Book Value shall be paid to the
Purchaser.
(e) Any payments required to be made pursuant to
Section 1.3(d) shall be made as follows: (i) if the Purchaser shall
not have delivered an Objection Notice to the Seller in accordance
with the provisions of Section 13(c), then the payment required to
be made pursuant to Section 1.3(d) shall be made within thirty (30)
days after the Purchaser shall have received the Book Value
Statement, and (b) if the Purchaser shall have delivered an
Objection Notice to the Seller in accordance with the provisions of
Section 13(c), then the payment required to be made pursuant to
Section 1.3(d) shall be made within thirty (30) days after the
resolution of the dispute, whether by agreement of the Seller and
the Purchaser or upon the determination of the independent
accounting firm as provided in Section 13(c), as to the dollar
amount of the Book Value.
(f) For purposes of this Section 1.3, the following
terms shall have the following meanings:
(i) "Base Amount" shall mean three million eight
hundred thousand dollars ($3,800,000).
(ii) "Book Value" shall mean the sum of the
dollar value of the Assets determined in accordance with GAAP and
the Accounting Policies created for the transactions related to
this Agreement set forth on Schedule 1.3(f) (the "Accounting
Policies") less the sum of (i) the accounts payable of the
Business at the Closing determined in accordance with GAAP and the
Accounting Policies and (ii) the accrued expenses of the Business
calculated in the manner or in the amount specified in the
Accounting Policies and without regards to GAAP.
1.4 Sales Taxes. The Purchaser shall bear and pay,
and shall reimburse the Seller and the Seller's affiliates for,
any sales taxes, use taxes, transfer taxes, documentary charges,
recording fees or similar taxes, charges, fees or expenses that
may become payable in connection with the sale of the Assets to
the Purchaser.
1.5 Allocation. Within sixty (60) days of the Closing,
the Seller shall deliver to the Purchaser a statement (the
"Allocation Statement") setting forth the Seller's good faith
determination of the manner in which the consideration referred to
in Sections 1.2(a) and 1.2(b)is to be allocated among the Assets.
The Seller, acting in good faith, may amend the Allocation
Statement to take into account the Book Value adjustment referred
to in Section 1.3 by delivering to the Purchaser, within thirty
(30) days after any payment has been made pursuant to Section
1.3(d), written notice of such amendment. If the Purchaser objects
to the Allocation Statement, then within fifteen days after the
delivery of the Allocation Statement, the Purchaser shall deliver a
written notice describing in reasonable detail the Purchaser's
objections to the Allocation Statement (an "Allocation Objection").
If the Purchaser shall not deliver an Allocation Objection to the
Seller within such fifteen day period, the allocation set forth in
the Allocation Statement (as such Allocation Statement may be
amended pursuant to the immediately preceding sentence) shall be
conclusive and binding upon the Purchaser and the Seller for all
purposes, and neither the Seller nor the Purchaser shall file any
tax return or other document with, or make any statement or
declaration to, any governmental body that is inconsistent with
such allocation. If the Purchaser delivers an Objection Allocation
to the Seller, and if the Purchaser and the Seller are unable to
agree upon the allocation within thirty (30) days after an
Objection Allocation is delivered to the Seller, the dispute shall
be finally settled by a mutually acceptable independent accounting
firm. The determination by the independent accounting firm of the
Book Value shall be conclusive and binding on the Purchaser and the
Seller. The Seller and the Purchaser shall each bear and pay 50% of
the fees and other expenses of such independent accounting firm.
1.6 Excluded Assets. Notwithstanding anything to the
contrary set forth in Section 1.1, the following assets of Seller
are specifically excepted from the Assets to be transferred to
Purchaser on the Closing Date (collectively, the "Excluded
Assets"):
(a) all real property owned or leased
by Seller or cash deposits related thereto except for the "Lease"
(as defined below).
(b) federal, state and local income and
franchise tax credits and tax refund claims;
(c) permits, to the extent not lawfully
transferable;
(d) Seller's original minute books, accounting
records, tax returns, receipts for taxes paid, licenses other than
any license relating to the Assets and the Business, accounts
payable records, bank statements, bank records, checks and any
other corporate records and documents of Seller that do not relate
to the Assets or the Business;
(e) all assets of the Seller which do not relate
to the Business including, without limitation, assets relating to
any electrical, electronic and electro-optic connection or
interconnection devices made, designed, developed or sold by
Seller ("Connectors");
(f) the assets of the Business listed on
Schedule 1.6;
(g) all rights to the names "AMP" and "AMP
Incorporated;"
(h) any debt or equity securities of Ocean Power
Technologies, Inc. issued to Seller; and
(i) any software or network connections which
relates or connects to the computer systems of Seller unless it is
listed on Schedule B.
1.7 Assumed Liabilities. Subject to the terms and
conditions of this Agreement, on the Closing Date, Purchaser shall
assume and agree to perform and discharge to the extent indicated
below the following, and only the following, specific debts,
liabilities and obligations of Seller (collectively the "Assumed
Liabilities"):
(a) Contractual Liabilities. Seller's
liabilities and obligations relating to the Business arising from
and after the Closing Date under and pursuant to the Contracts.
(b) Product Warranties. Seller's
product and service warranties and obligations including without
limitation those obligations described in Schedule 1.7(b).
(c) Lease Liability. Seller's
liabilities and obligations pursuant to the lease of the
Property (the "Lease").
(d) Balance Sheet Liabilities. Seller's
liabilities listed on Schedule 13(f).
Notwithstanding anything else in this Agreement to the
contrary, Purchaser shall not assume, pay, perform, or discharge,
and Seller shall solely retain, pay, perform and discharge any
obligations under law, including but not limited to antitrust
civil rights, health, safety, labor, discrimination and
environmental laws relating to periods before the Closing Date.
1.8 Employee Matters. Purchaser agrees to provide
Seller with a list of each employee of the Business who Purchaser
does not want to continue to employ in the Business. Seller shall
terminate such employees and pay each employee a severance payment
equal to one week of such employee's base salary for each year of
such employee's employment with the Seller, with a minimum payment
equal to two weeks of such employee's base salary. If Seller
rehires any of such employees within one year of the date hereof
and such employee is required to repay all or a portion of the
severance to Seller, then Seller shall reimburse Purchaser the
amount that it receives back from such employee.
1.9 Non-Competition. Except for the pachinko market,
the motor vehicle seat occupancy market and the motor vehicle
parking aid market, Seller agrees that for a period of two (2)
years commencing on the Closing Date, neither Seller nor any of
its Affiliates will compete with or against Purchaser, directly
or indirectly, in the design and manufacture of piezoelectric
polymer film-based sensor products and capacative brine level
sensor products (collectively, the "Products"); provided further,
that during such period, Seller may acquire an interest in an
entity the business of which includes, and will continue to
include, the design and manufacture of Products; provided further,
that the revenues earned by such entity in the most recent fiscal
year directly from the design and manufacture of Film Products do
not exceed thirty percent 30% of the total revenues earned by such
entity for such period.
SECTION 2. CLOSING
The closing of the transactions contemplated by
Sections 1 and 2 (the "Closing") shall be held at the offices of
Seller at 10:00 a.m. (Pennsylvania time) on August 14, 1998, or
at such other place, time and/or date as may be jointly designated
by Purchaser and Seller and shall be effective at 11:59 p.m.
(Pennsylvania time) on such date.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Purchaser that,
except as disclosed or otherwise referred to in the Disclosure
Schedule or in any of the documents identified in the Disclosure
Schedule:
3.1 Good Standing and Corporate Power of Seller.
Seller is validly existing and in good standing as a corporation
under the laws of the Commonwealth of Pennsylvania, and has all
necessary corporate power to perform its obligations under this
Agreement.
3.2 Title To Assets. The Seller owns, and has good,
valid and marketable title to, or leases, and has good title to,
all of the Assets free and clear of any Encumbrances. All
facilities, machinery, equipment, fixtures, vehicles and other
properties owned, leased or used by the Seller are currently in
good operating condition and repair and are reasonably fit and
usable for the purposes for which they are currently being used.
The Seller is in compliance with all material terms of each lease
to which it is a party or is otherwise bound.
3.3 Patents and Trademarks. The Seller owns or
possesses sufficient legal rights to all patents, trademarks,
service marks, trade names, copyrights, trade secrets, licenses,
information and other proprietary rights and processes necessary
for the conduct of the Business as now conducted and as presently
proposed to be conducted, without any known infringement of the
rights of others. There are no outstanding options, licenses or
agreements of any kind relating to the foregoing, nor is the
Seller bound by or a party to any options, licenses or agreements
of any kind with respect to the patents, trademarks, service marks,
trade names, copyrights, trade secrets, licenses, information and
other proprietary rights and processes of any other person or
entity other than such licenses or agreements arising from the
purchase of "off the shelf' or standard products. The Seller has
not received any communications relating to the intellectual
property of the Business alleging that the Seller has violated or,
by conducting its business as presently proposed, would violate any
of the patents, trademarks, service marks, trade names, copyrights
or trade secrets or other proprietary rights of any other person or
entity.
3.4 Authority, Approval and Enforceability.
(a) Seller has full corporate power and authority to
execute, deliver and perform its obligations under this Agreement
and all agreements, instruments and documents contemplated hereby,
and all corporate action of Seller necessary for such execution,
delivery and performance has been duly taken. Seller has provided
Purchaser with evidence of such authority.
(b) This Agreement is a legal, valid and binding
obligation of Seller, and, upon due execution and delivery by the
parties thereto, all agreements, instruments and documents to be
executed by Seller in connection with the transactions contemplated
hereby will be legal, valid and binding obligations of Seller, each
enforceable against Seller in accordance with its respective terms,
except as enforcement may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally, and subject to general equity
principles and to limitations on availability of equitable relief,
including specific performance.
3.5 Litigation. There is no action, suit, proceeding
or investigation pending or to the Seller's knowledge currently
threatened in writing against the Seller that questions the
validity of this Agreement or the right of the Seller to enter into
such agreement, or to consummate the transactions contemplated
hereby, or which might result, either individually or in the
aggregate, in a Material Adverse Effect. The Seller is not a party
or subject to the provisions of any order, writ, injunction,
judgment or decree of any court or government agency or
instrumentality which might result, either individually or in the
aggregate, in a Material Adverse Effect. There is no action, suit,
proceeding or investigation by the Seller relating to the Business
currently pending or which the Seller intends to initiate.
3.6 Compliance with Laws; Permits. Except for environmental
matters which are covered exclusively in Sections 3.8 and 4.6, to
its knowledge, the Seller is not in violation of any applicable
statute, rule or regulation of any domestic or foreign government
or any instrumentality or agency thereof in respect of the conduct
of the Business which violation would have a Material Adverse
Effect. No governmental orders, permissions, consents, approvals or
authorizations are required to be obtained and no registrations or
declarations are required to be filed in connection with the
execution and delivery of this Agreement, except such as has been
duly and validly obtained or filed, or with respect to any filings
that must be made after the Closing, as will be filed in a timely
manner. The Seller has all franchises, permits, licenses and any
similar authority necessary for the conduct of the Business, the
lack of which could have a Material Adverse Effect.
3.7 Contracts.
(a) There are no agreements, understandings,
instruments, Contracts, proposed transactions, judgments, orders,
writs or decrees relating exclusively to the Business to which the
Seller is a party or to its knowledge by which it is bound which
may involve (i) obligations (contingent or otherwise) of, or
payments to, the Seller in excess of $50,000 (other than obligations
of, or payments to, the Seller arising from purchase or sale
agreements entered into in the ordinary course of business), or (ii)
the license of any patent, copyright, trade secret or other
proprietary right to or from the Seller (other than licenses arising
from the purchase of "off the self' or other standard products), or
(iii) indemnification by the Seller with respect to infringements of
proprietary rights (other than indemnification obligations arising
from purchase or sale agreements entered into in the ordinary
course of business) (collectively, the "Material Contracts").
(b) To its knowledge, Seller has not violated or
breached, or declared or committed any default under, any Material
Contract, and the Seller has not received any notice or other
communication (in writing or otherwise) regarding any actual,
alleged, possible or potential violation or breach of, or default
under, any Material Contract.
(c) No person is renegotiating, or has the right to
renegotiate, any amount paid or payable to the Seller under any
Material Contract or any other term or provision of any Material
Contract.
3.8 Environmental Matters.
(a) Seller's Records Regarding Environmental Matters.
(i) Seller has made available to Purchaser
certain assessments, audit reports, correspondence, analyses,
permits, orders and other records available to Seller regarding
(i) the use, management, processing, generation, treatment,
storage and disposal of Hazardous Substances by the Business;
(ii) its compliance with Environmental Laws in connection with the
Business; and (iii) the environmental conditions of the
Property.
(ii) Seller also has made available to
Purchaser certain records available to Seller regarding prior
owners' or operators' use, management, processing, generation,
treatment, storage and disposal of Hazardous Substances on the
Property; compliance with Environmental Laws; any Environmental
Liabilities; and environmental conditions on and beneath the
Property before such Property were owned or operated by Seller.
(iii) Seller makes no representations or
warranties regarding the completeness or accuracy of the
information included in the records provided under this Section.
(b) Environmental and Safety Compliance. Seller's
conduct of the Business is not in violation of any Environmental
Law and no material expenditures are currently required in order
for the Business to comply with any Environmental Law.
(c) Prior to the Closing Date of this Agreement,
Purchaser may perform a due diligence investigation and other
environmental evaluation in accordance with Schedule 3.8 (the
"Environmental Assessment") of the Property, at its sole expense
and subject to mutually agreeable terms and conditions.
3.9 Suppliers. Except for the agreements referenced
herein, no supplier of the Business to whom the Business made
payments in excess of $50,000 during the fiscal year ended
December 31, 1997 has canceled or otherwise terminated its
relationship with the Business, or has during the last twelve
months decreased materially its sales of equipment, services,
supplies or materials to the Business. No such supplier has
notified the Seller of any plan or intention to terminate, to
cancel or to decrease materially its sale of materials, supplies,
services or equipment to the Business or otherwise materially and
adversely modify its relationship with the Business.
3.10 Customers, Distributors. None of the customers or
distributors who accounted for more than $50,000 of sales of the
Business during the fiscal year ended December 31, 1997 has
canceled or otherwise terminated its relationship with the
Business, or has during the last seven months decreased materially
its usage or purchases of the services or products of the Business.
No such customer or distributor has notified the Seller of any
plan or intention to terminate, to cancel or to decrease
materially its usage, purchase or distribution of the services or
products of the Business or otherwise materially and adversely
modify its relationship with the Business.
3.11 Financial Statements. The Seller has delivered to
Purchaser (a) its unaudited pro forma balance sheet of the
Business as at December 31, 1997 and unaudited statement of income
of the Business for the twelve months ending December 31, 1997 and
(b) its unaudited balance sheet of the Business as at March 31,
1998 and unaudited consolidated statement of income of the Business
for the three month period ending on March 31, 1998 (collectively,
the "Financial Statements"). The Financial Statements, together
with the notes thereto, have been prepared in accordance with the
standard accounting procedures of the Business applied on a
consistent basis throughout the periods indicated, except as
disclosed therein, and present fairly the financial condition and
position of the Business as of December 31, 1997 and March 31,
1998; provided however, that the Financial Statements are subject
to normal recurring year-end audit adjustments (which are not
expected to be material).
3.12 Liabilities. Except for liabilities under Environmental
Laws, which are addressed exclusively in Section 3.8 and Section
4.6, the Seller has no material liabilities and, to the best of
the Seller's knowledge, the Seller knows of no material contingent
liabilities of the Business not disclosed in the Financial
Statements, except current liabilities incurred in the ordinary
course of business subsequent to March 31, 1998 which have not been,
either in any individual case or in the aggregate, materially
adverse.
3.13 Changes. Since March 31, 1998, there has not been to the
Seller's knowledge:
(a) Any material change in the assets, liabilities,
financial condition or operations of the Business from that
reflected in the Financial Statements, other than changes in the
ordinary course of business, none of which individually or in the
aggregate has had or is expected to have a Material Adverse Effect;
(b) Any resignation or termination of any key
employee of the Business; and the Seller, to the best of its
knowledge, does not know of the impending resignation or
termination of employment of any such key employee;
(c) Any damage, destruction or loss, whether or
not covered by insurance, materially and adversely affecting the
properties, business or prospects or financial condition of the
Business;
(d) Any material change in any compensation
arrangement or agreement with any employee or officerof the
Business; or
(e) Any change in any Material Contract which
materially and adversely affects the business, assets,
liabilities, financial condition, operations or prospects of the
Business.
3.14 No Conflict. The execution and delivery by Seller
of this Agreement and any other agreements, instruments and
documents to be executed and delivered by Seller pursuant hereto
do not, and the performance and consummation by Seller of the
transactions contemplated hereby and thereby will not, conflict
with or result in any breach or violation of or default,
termination, forfeiture or lien under (or upon the failure to
give notice or the lapse of time, or both, result in any conflict
with, breach or violation of or default, termination, forfeiture or
lien under) any terms or provisions of Seller's charter documents,
each as amended, any statute, rule, regulation, judicial or
governmental decree, order or judgment, or any Material Contract;
that has or is likely to have a Material Adverse Effect.
3.15 No Consent Required. No consent, authorization,
approval, order, license, certificate or permit or act of or from,
or declaration or filing with, any foreign, federal, state, local
or other governmental authority or regulatory body or any court or
other tribunal or any party to any Material Contract; that has or
is likely to have a Material Adverse Effect, is required for the
execution, delivery or performance by Seller of this Agreement or
any of the other agreements, instruments and documents being or to
be executed and delivered hereunder or in connection herewith or
for the consummation of the transactions contemplated hereby.
3.16 Year 2000 Compliance. Notwithstanding anything
contained in this Agreement to the contrary, Seller makes no
representation or warranty (express or implied) to Purchaser, and
hereby disclaims any and all liability, that (i) any of the Assets,
or (ii) any aspect of the Business, or (iii) any goods or services
sold or provided by Seller to any party, or any aspect thereof, is
or will be Year 2000 Compliant (as defined below in Exhibit A).
Purchaser agrees to accept all the Assets and all the Assumed
Liabilities subject to such disclaimer, and Seller shall not in any
way be in violation of any of its representations, warranties
or obligations contained in this Agreement, or any document or
instrument provided pursuant to this Agreement, for any failure
of any of the foregoing to be Year 2000 Compliant.
3.17 Broker's Fees. No agent, broker, investment banker,
person or firm acting on behalf of Seller is or will be entitled to
any broker's or finder's fee or any other commission directly or
indirectly in connection with the transactions contemplated herein.
Seller further agrees to indemnify Purchaser for any claims, losses
or expenses incurred by such other party as a result of the
representation in this Section 3.17 being untrue.
3.18 Inventories. The inventories relating to the Business
reflected on the Financial Statements have been acquired in the
ordinary course of business and have been accounted for and valued
in accordance with Seller's normal inventory practices.
3.19 Accounts Receivable. The accounts receivable relating
to the Business reflected on the Financial Statements arose from
arms-length sales to unrelated third parties in the ordinary course
of business and sales to Affiliates and have been accounted for and
valued in accordance with Seller's normal credit policies.
3.20 Assets. The assets to be acquired by Purchaser
hereunder constitute all of the assets currently in use and
necessary to the conduct of the Business as conducted by Seller.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants that, to the best of
its knowledge, the following statements are accurate in all
material respects:
4.1 No Conflict. The execution and delivery by Purchaser
of this Agreement and any other agreements, instruments and
documents to be executed and delivered by Purchaser pursuant hereto
do not, and the performance and consummation by Purchaser of the
transactions contemplated hereby and thereby will not, conflict with
or result in any breach or violation of or default, termination,
forfeiture or lien under (or upon the failure to give notice or the
lapse of time, or both, result in any conflict with, breach or
violation of or default, termination, forfeiture or lien under) any
terms or provisions of Purchaser's charter documents, each as
amended, or any statute, rule, regulation, judicial or governmental
decree, order or judgment, or any agreement, lease or other
instrument to which Purchaser is a party or to which Purchaser or
its assets are subject; that has or is likely to have a Material
Adverse Effect.
4.2 No Consent Required. No consent, authorization,
approval, order, license, certificate or permit or act of or from,
or declaration or filing with, any foreign, federal, state, local
or other governmental authority or regulatory body or any court or
other tribunal or any party to any contract, agreement, instrument,
lease or license to which Purchaser is a party or to which
Purchaser or its assets are subject; that has or is likely to have
a Material Adverse Effect, is required for the execution, delivery
or performance by Purchaser of this Agreement or any of the other
agreements, instruments and documents being or to be executed and
delivered hereunder or in connection herewith or for the
consummation of the transactions contemplated hereby.
4.3 Good Standing and Corporate Power. Purchaser is validly
existing and in good standing as a corporation under the laws of
the State of New Jersey, and has all necessary corporate power to
perform its obligations under this Agreement.
4.4 Authority, Approval and Enforceability.
(a) Purchaser has full corporate power and authority
to execute, deliver and perform its obligations under this
Agreement and all agreements, instruments and documents
contemplated hereby, and all corporate action of Purchaser
necessary for such execution, delivery and performance has been
duly taken. Purchaser has provided Seller with evidence of such
authority.
(b) This Agreement is a legal, valid and binding
obligation of Purchaser, and, upon due execution and delivery by
the parties thereto, all agreements, instruments and documents to
be executed by Purchaser in connection with the transactions
contemplated hereby will be legal, valid and binding obligations of
Purchaser, each enforceable against Purchaser in accordance with
its respective terms, except as enforcement may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally, and subject to
general equity principles and to limitations on availability of
equitable relief, including specific performance.
4.5 Government Contracts. Purchaser has not been
debarred, suspended or otherwise precluded from performing on U.S.
Government prime contracts, subcontracts or purchase orders.
4.6 Environmental Matters. Purchaser acknowledges that to
the extent it is acquiring any interest in the Property, it accepts
the Property AS IS, WHERE IS, with all faults and defects.
Purchaser is familiar with the Property and acknowledges that,
except for those representations and warranties provided in Section
3.8(b) of this Agreement, Seller makes no representations or
warranties whatsoever as to any defect or condition at the Property.
Purchaser releases, acquits and discharges Seller from any and all
claims, including but not limited to claims arising under CERCLA or
any other Environmental Law, that have been or may be asserted that
arise from or relate in any way to the condition of the Property,
except claims for indemnification pursuant to Section 7 of this
Agreement.
4.7 Broker's Fees. No agent, broker, investment banker,
person or firm acting on behalf of Purchaser is or will be entitled
to any broker's or finder's fee or any other commission directly or
indirectly in connection with the transactions contemplated herein.
Purchaser further agrees to indemnify Seller for any claims, losses
or expenses incurred by such other party as a result of the
representation in this Section 4.7 being untrue.
SECTION 5. CONDITIONS TO OBLIGATION OF PURCHASER TO CLOSE
The obligation of Purchaser to purchase the Assets and
otherwise consummate the transactions that are to be consummated
at the Closing is subject to the satisfaction, as of the Scheduled
Closing Time, of the following conditions (any of which may be
waived by Purchaser in whole or in part):
5.1 Representations and Warranties True. The
representations and warranties made by the Seller shall be true and
correct in all material respects at the date of the Closing, with
the same force and effect as if they had been made on and as of
said date.
5.2 Performance of Obligations. The Seller shall have
performed and complied with all agreements and conditions herein
required to be performed or complied with by the Seller on or
before the Closing.
5.3 Consents, Permits, and Waivers. The Seller shall have
obtained any and all consents, permits and waivers as set forth in
Section 3.15 of the Disclosure Schedule necessary or appropriate
for consummation of the transactions contemplated by the Agreement
(except for such as may be properly obtained subsequent to the
Closing).
5.4 No Injunction. There shall not be in effect, at the
Closing Date, any injunction or other binding order of any court or
other tribunal having jurisdiction over Purchaser that prohibits
the purchase of the Assets.
5.5 Sensor Supply Seller and Purchaser shall have entered
into a supply agreement substantially in the form as attached
hereto as Exhibit 5.5 relating to the supply of the Badger Meter
Cam II Switch (p/n 1004876).
SECTION 6. CONDITIONS TO OBLIGATION OF SELLER TO CLOSE
The obligation of Seller to cause the Assets to be sold to
Purchaser and otherwise consummate the transactions that are to be
consummated at the Closing is subject to the satisfaction, as of
the Scheduled Closing Time, of the following conditions (any of
which may be waived by Seller in whole or in part):
6.1 Representations and Warranties True. The
representations and warranties made by the Purchaser shall be true
and correct in all material respects at the date of the Closing,
with the same force and effect as if they had been made on and as
of said date.
6.2 Performance of Obligations. The Purchaser shall have
performed and complied with all agreements and conditions herein
required to be performed or complied with by the Purchaser on or
before the Closing.
6.3 Consents, Permits, and Waivers. The Purchaser shall
have obtained any and all material consents, permits and waivers
necessary or appropriate for consummation of the transactions
contemplated by the Agreement (except for such as may be
properly obtained subsequent to the Closing).
6.4 No Injunction. There shall not be in effect, at the
Scheduled Closing Time, any injunction or other binding order of
any court or other tribunal having jurisdiction over Seller or
the Company that prohibits the sale of the Purchased Stock to
Purchaser.
6.5 Sensor Supply Seller and Purchaser shall have entered
into a supply agreement substantially in the form as attached
hereto as Exhibit 5.5 relating to the supply of the Badger Meter
Cam II Switch (p/n 1004876).
SECTION 7. INDEMNIFICATION BY SELLER
7.1 Indemnification by Seller. Subject to the limitations
set forth in this Section 7 and elsewhere in this Agreement,
Seller shall indemnify and hold Purchaser and each person serving
as an officer, director, partner, employee or agent of Purchaser
(collectively, the "Purchaser Indemnitees"), harmless from and
against any Damages incurred by the Purchaser Indemnitees
resulting from, arising out of, relating to, in the nature of or
caused by (i) a breach by Seller of any representation, warranty
or covenant of Seller set forth in this Agreement, (ii) any
liability of Seller which is not an Assumed Liability or
(iii) the alleged infringement of U.S. Patent No. 5,571,961 held
by KIH, German Utility Model No. 93 21447.2 and all other pending
and/or issued foreign counterparts, or the alleged
misappropriation of KIH proprietary information related to the
RoadTrax Sensors (collectively, the "KIH Intellectual Property")
by Seller or Purchaser (the "KIH Matter"), except in the case
of Damages incurred by Purchaser resulting from, arising out of,
relating to, in the nature of or caused by a breach of Section 8.8
by Purchaser for which Seller shall not be liable for such Damages.
7.2 Indemnification by Purchaser. Subject to the
limitations set forth in this Section 7 and elsewhere in this
Agreement, Purchaser shall indemnify and hold Seller and each
person serving as an officer, director, partner, employee or agent
of Seller (collectively, the "Seller Indemnitees" and with the
Purchaser Indemnitees, the "Indemnitees"), harmless from and
against any Damages incurred by the Indemnitees resulting from,
arising out of, relating to, in the nature of or caused by
(i) a breach by Purchaser of any representation, warranty or
covenant of Purchaser set forth in this Agreement, (ii) any
Assumed Liability or (iii) any Matters relating to the Business
arising after the Closing Date (except for Excluded Assets).
7.3 Expiration of Representations and Warranties . All of
the representations and warranties of Seller and Purchaser set
forth in this Agreement shall terminate and expire, and shall
cease to be of any force or effect, at 5:00 p.m. (Pennsylvania time)
on the second anniversary of the Closing Date, and all liability of
Seller and Purchaser with respect to such representations and
warranties shall thereupon be extinguished; provided, however, that
if, prior to such second anniversary, either party hereto (the
"Claimant") shall have duly delivered a claim notice (as defined
below) to the other party, then the specific indemnification claim
set forth in such claim notice (as defined below) shall survive
such second anniversary (and shall not be extinguished thereby).
Neither Purchaser nor Seller shall have any obligation to indemnify
the other for Damages resulting from, arising out of, relating
to, in the nature of or caused by a breach of a representation,
warranty or covenant by such Purchaser or Seller, respectively,
pursuant to Sections 7.1 and 7.2 or pursuant to the KIH Matter
after two (2) years from the Closing Date.
7.4 Deductible Amount. Without limiting the effect of any
of the other limitations set forth herein and except in connection
with the KIH Matter, Seller shall not be required to make any
indemnification payment hereunder, except to the extent that the
cumulative amount of the Damages actually incurred by Purchaser
exceeds the Deductible Amount; and Seller shall only be required
to pay, and shall only be liable for, the amount by which the
cumulative amount of the Damages actually incurred by Purchaser
actually exceeds the Deductible Amount. The "Deductible Amount"
shall be $100,000.
7.5 Maximum Liability of Seller. Except for the KIH
Matter, the total amount of the payments that Seller can be
required to make under or in connection with this Agreement shall
be limited in the aggregate to a maximum of fifty (50%) percent of
the Base Amount, as adjusted pursuant to Section 1, and Seller's
cumulative liability shall in no event exceed such amount. In
connection with the KIH Matter, the total amount of the payments
that Seller can be required to make in connection with Damages
related to the activities of Purchaser after the Closing shall be
limited to two hundred fifty thousand ($250,000) dollars.
Furthermore, in connection with the KIH Matter there shall be no
limit with respect to Damages related to activities by the Seller
prior to the Closing. If certain Damages cannot be related to
pre-Closing activities or post-Closing activities, then such
Damages shall be apportioned on a pro rata basis based on the
respective sales of infringing products by the Seller pre-Closing
and the Purchaser post-Closing.
7.6 Defense of Third Party Actions. The Seller shall
assume the defense of the KIH Matter with its own counsel. In
addition, if any Indemnitee receives notice or otherwise obtains
knowledge of any Matter or any threatened Matter other than the
KIH Matter that may give rise and to an indemnification claim
against the Indemnitee, then the Indemnitee shall promptly deliver
to the other party hereto (the "Indemnifying Party") a written
claim notice describing such Matter in reasonable detail; provided,
however, that for the sole purpose of determining whether a Matter
or threatened Matter may give rise to an indemnification claim
against Seller within the meaning of this sentence, the limitation
set forth in Section 7.5 shall not be taken into account. The
timely delivery of such written notice by the Indemnitee to the
Indemnifying Party shall be a condition precedent to any liability
on the part of the Indemnifying Party under this Section 7 with
respect to such Matter other than the KIH Matter. The Indemnifying
party has the right, at its option, to assume the defense of any
such Matter other than the KIH Matter with its own counsel. If the
lndemnif~dng Party elects to assume the defense of any such Matter
including the KIH Matter, then:
(a)notwithstanding anything to the contrary contained in
this Agreement, the Indemnifying Party shall not be required to pay
or otherwise indemnify the Indemnitee against any attorneys' fees
or other expenses incurred on behalf of the Indemnitee in connection
with such Matter following the Indemnifying Parties election to
assume the defense of such Matter;
(b) the Indemnitee shall make available to the
Indemnifying Party all books, records and other documents and
materials that are under the direct or indirect control of the
Indemnitee or any of the Indemnitee's Representatives and that the
Indemnitdng Party considers necessary or desirable for the defense
of such Matter;
(c) the Indemnitee shall execute such documents and
take such other actions as the Indemnifying Party may reasonably
request for the purpose of facilitating the defense of, or any
settlement, compromise or adjustment relating to, such Matter;
(d) the Indemnitee shall otherwise fully cooperate
as reasonably requested by the Indemnifying Party in the defense
of such Matter;
(e) the Indemnitee shall have the right to
participate in the defense of such Matter at its own expense,
except in the case of the KIH Matter where the legal fees of the
Purchaser shall be deemed to be Damages;
(f) the Indemnitee shall not admit any liability with
respect to such Matter;
(g) the Indemnifying Party shall have the exclusive
right to settle, adjust or compromise such Matter, on such terms as
it may deem appropriate, without the consent or approval of the
Indemnitee or any other Person.
If the Indemnifying Party elects not to assume the defense of such
Matter, then the Indemnitee shall proceed diligently to defend
such Matter with the assistance of counsel satisfactory to the
Indemnifying Party; provided, however, that the Indemnitee shall
not settle, adjust or compromise such Matter, or admit any
liability with respect to such Matter, without the prior written
consent of the Indemnifying Party.
7.7 Subrogation. To the extent that the Indemnifying
Party makes or is required to make any indemnification payment to
any Indemnitees, the Indemnifying Party shall be entitled to
exercise, and shall be subrogated to, any rights and remedies
(including rights of indemnity, rights of contribution and other
rights of recovery) that the Indemnitee may have against any other
Person with respect to any Damages, circumstances or Matter to
which such indemnification payment is directly or indirectly
related. The Indemnitee shall permit the Indemnifying Party to use
the name of the Indemnitee in any transaction or in any proceeding
or other Matter involving any of such rights or remedies; and the
Indemnitee shall take such actions as the Indemnifying Party may
reasonably request for the purpose of enabling the Indemnifying
Party to perfect or exercise the Indemnifying Party's right of
subrogation hereunder.
7.8 Fraud Notwithstanding any provision of this Agreement
to the contrary, liability of either Purchaser or Seller for common
law fraud, intentional misrepresentation or other claim involving
intentional misconduct shall not be limited in amount, procedure
for dispute resolution or as to time during which a claim may be
made.
7.9 Exclusivity. The right of each party hereto to assert
indemnification claims and receive indemnification payments
pursuant to this Section 7 shall be the sole and exclusive right
and remedy exercisable by such party with respect to any Damages
pursuant to this Agreement (other than in connection with the
Environmental Assessment) and such remedy shall be in lieu of,
and not in addition to, any remedies under statutory or common law,
including CERCLA.
SECTION 8. POST-CLOSING COVENANTS
8.1 Financial Statements. Within ten (10) days of the
Closing, Seller shall provide Purchaser with an estimated,
unaudited balance sheet as of the Closing Date and an estimated
Allocation Statement. Within (60) days of the Closing, Seller shall
provide Purchaser with (i) an audited statement of net assets of
the Business as at December 31, 1997, and December 31, 1996, (ii)
an audited statement of revenue and expenses of the Business for
the twelve months ended December 31, 1997 and December 31, 1996,
and (iii) an audited statement of revenue and expenses for period
from December 31, 1997 through the Closing Date, prepared in
accordance with the GAAP.
8.2 Support. Seller shall provide manufacturing systems
support to Purchaser for nine months from the Closing in
accordance with the terms and conditions in Exhibit 8.2.
8.3 Connector Supply. Seller shall continue to supply
Connectors to Purchaser through the end of 1998 in accordance with
the terms and conditions in the Seller's standard acknowledgment
form and at the prices set forth on Exhibit 8.3.
8.4 04-08 Lead Frame Die. Seller shall continue to supply
Purchaser with lead frames for the 04-08 accelerometer program
through the end of 1999 in accordance with the terms and conditions
in the Seller's standard acknowledgement form at prices set forth
in Exhibit 8.4.
8.5 Film Supply. Purchaser shall continue to supply Seller
piezoelectric polymer film through the end of 1999 in accordance
with the terms and conditions in the Purchaser's standard
acknowledgment form at prices set forth in Exhibit 8.5.
8.6 DuPont C Thread Systems. Purchaser agrees to pay
Seller one third of any proceeds received by Purchaser from DuPont
(up to a maximum of $62,000) pursuant to the sale of any DuPont C
Thread Systems currently held in inventory as set forth on Exhibit 8.6.
8.7 Employees
(a) To assist Purchaser in the transition of accounting
services, Seller will make available to Purchaser the services of
▇▇▇ ▇▇▇▇▇▇▇, currently the Senior Accountant for the Business, at a
rate of $260 per day. All ▇▇▇▇▇▇▇▇ will be based on the daily rate
irrespective of whether ▇▇. ▇▇▇▇▇▇▇'▇ services are used for all or
part of a day. ▇▇. ▇▇▇▇▇▇▇ will be made available for up to eight
hours per day, up to four days per week for a period beginning on
the Closing Date and ending on September 30, 1998.
(b) To assist Purchaser in the transition of material
services, Seller will make available to Purchaser the services of
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇-Homing, currently the Materials Supervisor of the
Business, at a rate of $257 per day. All ▇▇▇▇▇▇▇▇ will be based on
the daily rate irrespective of whether ▇▇. ▇▇▇▇▇▇-Homing's services
are used for all or part of a day. She will be made available for
up to eight hours per day, up to 2-3 days per week for a period
beginning on the Closing Date and ending on August 31, 1998.
(c) To assist the Purchaser in the transition of
European sales and product development, ▇▇▇▇▇▇▇ ▇▇▇▇▇ will remain
an employee of Seller for a period of sixty days after the Closing
Date. At the end of sixty days, Seller will make an offer of
employment to ▇▇. ▇▇▇▇▇. Seller will reimburse Purchaser for 100%
of the costs incurred by Purchaser in maintaining ▇▇. ▇▇▇▇▇ as an
employee, including any severance costs.
8.8 KIH Matter The Purchaser shall use its commercially
reasonable efforts to implement the proposed redesign of the
products which are affected by the KIH Intellectual Property
within six (6) months of the Closing.
8.9 EIF Atochem The Purchaser shall reimburse Seller
for any payment of "Shortfall Amounts" that Seller makes to ELF
Atochem North America, Inc. ("ELF") pursuant to the Assignment
Agreement between ELF and the Seller dated as of the date hereof.
SECTION 9. MISCELLANEOUS PROVISIONS
9.1 Governing Law. This Agreement shall be construed
in accordance with, and governed in all respects by, the laws of
the Commonwealth of Pennsylvania (without giving effect to
principles of conflicts of law).
9.2 Arbitration. If a dispute arises between the parties
relating to the interpretation of performance of this Agreement,
the parties agree to hold a meeting, attended by individuals with
decision-making authority regarding the dispute, to attempt in
good faith to negotiate a resolution of the dispute prior to
pursuing other available remedies. If, within thirty (30) days
after such meeting, the parties have not succeeded in negotiating
the resolution of the dispute, either party may request that such
dispute be resolved through final and binding arbitration. Such
arbitration shall be conducted by a single arbitrator in New York,
New York, in accordance with the then-current commercial
arbitration rules and supplementary procedures for commercial
arbitration of the American Arbitration Association ("AAA"). Such
arbitrator shall be selected by the mutual agreement of the
parties or, failing such agreement, shall be selected according to
the aforesaid AAA rules. The parties shall bear the costs of such
arbitrator equally. The prevailing party in any such arbitration
or in any judicial enforcement or review proceeding shall be
entitled to its reasonable attorneys' fees and costs in addition
to any other amount of recovery ordered by such arbitrator or court.
If judicial enforcement or review of such arbitrator's award is
sought by either party, judgement may be entered upon such award in
a Pennsylvania court of competent jurisdiction according to
Pennsylvania law. The duty of the parties to arbitrate any dispute
relating to the interpretation or performance of this Agreement
thereof shall survive the expiration or termination of this
Agreement for any reason.
9.3 Publicity. No press release, publicity, disclosure
or notice to any person concerning any of the transactions
contemplated by this Agreement shall be issued, given, made or
otherwise disseminated by either Party or any of its
Representatives at any time (whether prior to, at or after the
Closing) without the prior written approval of both parties.
9.4 Notices. All notices required or permitted hereunder
shall be in writing and shall be deemed effectively given: (a)
upon personal delivery to the party to be notified; (b) when
sent by confirmed telex or facsimile if sent during normal
business hours of the recipient, if not, then on the next business
day; (c) five (5) days after having been sent by registered or
certified mail, return receipt requested, postage prepaid; or (d)
one (1) day after deposit with a nationally recognized overnight
courier, specifying next day delivery, with written verification
of receipt. All communications shall be sent to the addresses set
forth below or at such other address as the Seller or Purchaser
may designate by ten (10) days advance written notice to the
other parties hereto.
if to Purchaser:
Measurement Specialties, Inc.
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Executive Officer
with a copy to:
▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
if to Seller:
AMP Incorporated
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
M/S 176-034
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Corporate Development
with a copy to:
▇▇▇▇▇▇ Godward LLP
Five Palo Alto Square
▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
9.5 Expenses. Each party shall pay all costs and
expenses that it incurs with respect to the negotiation,
execution, delivery and performance of the Agreement.
9.6 Table of Contents and Headings. The table of contents
of this Agreement and the underlined headings contained in this
Agreement are for convenience of reference only, shall not be
deemed to be a part of this Agreement and shall not be referred to
in connection with the construction or interpretation of this
Agreement.
9.7 Entire Agreement. Except for the letter agreement
dated July 20, 1998 between the parties, which shall not be
reduced or modified by this Agreement, the Agreement, the Exhibits
and Schedules hereto and the other documents delivered pursuant
hereto constitute the full and entire understanding and agreement
between the parties with regard to the subjects hereof and no party
shall be liable or bound to any other in any manner by any
representations, warranties, covenants and agreements except as
specifically set forth herein and therein.
9.8 Parties in Interest. Nothing in this Agreement is
intended to provide any rights or remedies to any Person
(including any employee or creditor of the Business) other than the
parties hereto.
9.9 Severability. In the event that any provision of
this Agreement, or the application of such provision to any Person
or set of circumstances, shall be determined to be invalid,
unlawful, void or unenforceable to any extent, the remainder of
this Agreement, and the application of such provision to Persons or
circumstances other than those as to which it is determined to be
invalid, unlawful, void or unenforceable, shall not be affected and
shall continue to be valid and enforceable to the fullest extent
permitted by law.
9.10 Waiver. No failure on the part of either party hereto
to exercise any power, right, privilege or remedy under this
Agreement, and no delay on the part of either party hereto in
exercising any power, right, privilege or remedy under this
Agreement, shall operate as a waiver thereof; and no single or
partial exercise of any such power, right, privilege or remedy shall
preclude any other or further exercise thereof or of any other
power, right, privilege or remedy.
9.11 Amendments. This Agreement may not be amended,
modified, altered or supplemented except by means of a written
instrument executed on behalf of both Purchaser and Seller.
9.12 Further Assurances. Each party hereto shall
execute and cause to be delivered to each other party hereto such
instruments and other documents, and shall take such other actions,
as such other party may reasonably request (prior to, at or after
the Closing) for the purpose of carrying out or evidencing any of
the transactions contemplated by this Agreement.
9.13 Bulk Transfer Laws. Purchaser hereby waives
compliance with the provisions of any applicable laws relating to
bulk transfers of assets.
9.14 Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be an original, but all
of which together shall constitute one instrument.
Purchaser and Seller have caused this Agreement to be executed
as of August 14, 1998.
MEASUREMENT SPECIALTIES, INC.
By:
Name:
Title:
AMP INCORPORATED
By:
Name:
Title:
THE ▇▇▇▇▇▇▇▇ CORPORATION
By:
Name:
Title:
EXHIBIT A TO
ASSET PURCHASE AGREEMENT
Defined Terms
For purposes of this Agreement (including the Disclosure
Schedule):
"Affiliate" shall mean any person or business entity
which directly or indirectly through
one or more intermediaries, controls, is controlled by, or
is under common control with Seller or
Purchaser.
"Assets" shall mean and include all right, title and
interest in and to the following:
(a) all accounts receivable, notes
receivable and other receivables of the Sell
relating to the Business as set forth on Schedule A
the Property;
(b) all inventory held for use in the conduct of
the Business, including,
without limitation, raw materials, work in process,
finished goods, service parts and supplies
(including all supplies which have been expensed by
Seller);
(c) all ftu-▇▇▇▇▇▇, fixtures, equipment,
machinery, parts, tools, dies, jigs,
patterns, molds, and other similar items used in the
conduct of the Business (including, without
limitation, that which has been fully depreciated or is
under construction) as described in
Schedule B;
(d) the leasehold interest and leasehold improvements
created by the lease of
(e) all Proprietary Assets and goodwill of the
Seller relating to the Business as
set forth on Schedule C, except to the extent that Seller
retains a nonexclusive, royalty free,
perpetual, worldwide right and license with right to
sublicense to its affiliates to practice, make,
have made use and sell items which are covered by certain
Proprietary Assets;
(f) all computer software and hardware, and
associated license and
maintenance agreements, used in the conduct of the
Business, including all documentation and
source codes with respect to such software, to the extent
they are legally transferable by Seller;
(g) all rights of the Seller under any written,
oral, implied or other agreement,
contract, understanding, arrangement, instrument, note,
guaranty, indemnity, representation,
warranty, deed, assignment, power of attorney,
certificate, purchase order, work order, insurance
policy, benefit plan, commitment, covenant, assurance or
undertaking of any nature relating
exclusively to the Business with parties other than Seller
(collectively, the "Contracts");
(h) all claims (including claims for
past infringement of Proprietary Assets)
and causes of action of the Seller relating to the
Business against other Persons (regardless of
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1.
whether or not such claims and causes of action have been
asserted by the Seller), and all rights
of indemnity, warranty rights, rights of contribution,
rights to refunds, rights of reimbursement
and other rights of recovery possessed by the Seller
relating to the Business (regardless of
whether such rights are currently exercisable); and
(i) all books, records, files and
data of (or relating directly or indirectly to the
business or operations of) located at the Property.
place.
"Closing Date" shall mean the time and date as of which
the Closing actually takes
"Damages" shall mean any out-of-pocket loss, injury,
liability, claim, expense,
settlement, judgment, award, fine, penalty, fee (including
reasonable attorney's fees) or tax;
provided, however, that Damages will not include any
consequential damages or lost profits and
provided, further that for purposes of computing the
amount of damages incurred by any Person,
there shall be deducted an amount equal to the amount of
any insurance proceeds,
indemnification payments, contribution payments or
reimbursements directly or indirectly
received or receivable by such Person or any of such
Person's affiliates in connection with such
Damages or the circumstances giving rise thereto. In the
case of the KIH Matter, Damages shall
mean the total of the following: (i) any judgment, award,
fine, penalty or fee awarded against
Purchaser; (ii) any amounts paid in settlement of the KIH
Matter; (iii) any attorneys fees and
disbursements incurred by Purchaser pursuant to Section
7.6(e); and (iv) fifty (50%) percent of
the profit margin on lost sales of the Purchaser's
products affected by the KIH patent based on
sales totals and profit margins for such products during
the previous twelve (12) months.
"Encumbrance" shall mean any lien, pledge,
hypothecation, charge, mortgage, security
interest, encumbrance, equity, trust, equitable interest,
claim, preference, right of possession,
lease, tenancy, license, encroachment, covenant,
infringement, interference, Order, proxy,
option, right of first refusal, preemptive right,
community property interest, legend, defect,
impediment, exception, reservation, limitation,
impairment, imperfection of title, condition or
restriction of any nature (including any restriction on
the transfer of any asset, any restriction on
the receipt of any income derived from any asset, any
restriction on the use of any asset and any
restriction on the possession, exercise or transfer of any
other attribute of ownership of any
asset).
"Environmental Laws" shall mean any and all federal,
state, regional and local laws,
regulations, ordinances and other requirements relating to
pollution or protection of the
environment and human health and safety in effect at the
Closing. The term includes without
limitation the Comprehensive Environmental Response,
Compensation and Liability Act
(CERCLA), 42 U.S.C. 9601 et seq.
"Hazardous Substances" shall mean any hazardous,
toxic or dangerous waste,
substance or material defined or regulated as such under
any Environmental Laws, and includes
without limitation petroleum products, asbestos-containing
materials, lead-based paint and radon
gas.
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"GAAP" shall mean generally accepted accounting
principles.
"Material Adverse Effect" Any other event or
condition of any character (as such
events or conditions relate particularly to the Company,
not to markets, economic conditions,
business or industries generally) that, either
individually or cumulatively, has a material and
adverse affect on the business, assets, liabilities,
financial condition, operations or prospects of
the Seller or the Purchaser.
"Matter" shall mean any claim, demand, dispute,
action, suit, examination, audit,
proceeding, investigation, inquiry or other similar matter
involving a third party or otherwise that
may give rise to Damages.
"Person" shall mean any individual, corporation,
association, general partnership,
limited partnership, venture, trust, association, firm,
organization, company, business, entity,
union, society, government (or political subdivision
thereof) or governmental agency, authority
or instrumentality.
"Property" shall mean the property and facilities of
the Business located at ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇.
"Proprietary Asset" shall mean any patent, patent
application, trademark (whether
registered or unregistered), trademark application, trade
name, fictitious business name, service
▇▇▇▇ (whether registered or unregistered), service ▇▇▇▇
application, copyright (whether
registered or unregistered) or copyright application,
maskwork, maskwork application,
formulations, process, technique, trade secret, know how,
customer list, franchise, system,
computer software, invention, design, blueprint,
engineering drawings, proprietary product,
technology, proprietary right or other intellectual
property right or intangible asset relating
exclusively to the Business.
"Representatives" of a Person shall include:
(a) such Person's affiliates,
stockholders, directors, officers, employees,
agents, attorneys, accountants and representatives; and
(b) all stockholders, directors,
officers, employees, agents, attorneys,
accountants and representatives of each of such Person's
affiliates.
"Year 2000 Compliant" shall mean the ability to
operate, including but not limited to
the manufacture, transportation, or delivery of any
products or services, (i) in the year 2000 and
later with four digit date capability, or (ii) fault-free
in the processing of date in and date-
dependent data (including, but not limited to,
calculating, comparing and sequencing), or (iii)
with appropriate encoding so that the date progression
within, from, into and between centuries
(including, without limitation, the 20'h and 2l't
centuries) shall not adversely affect performance.
238250 vI I/PA
530/621 1!.DOC
081398
3.
An extra section break has been inserted above this
paragraph. Do not delete this section break if
you plan to add text after the Table of
Contents/Authorities. Deleting this break will cause Table
of Contents/Authorities headers and footers to appear on
any pages following the Table of
Contents/Authorities.
2382~O vI I/PA
538/o2l ILDOC
081398
1.
Purchaw and ▇▇▇▇▇ have caused this Agmment to be executed
mo of August 14, 1998.
MXAWRZMZM SPMAL I I , INC.
By:
(Ij %J
Na=: ::% -.- sptl R - Y7
Title: CC CD
AMM INcoammATED
By:
Nam:
Title:
Tmz ▇▇▇▇▇▇▇▇ CORPORATION
By-
Name:
Title:
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