Asset Purchase Agreement (2004)Full Document 

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ASSET PURCHASE AGREEMENT

 

This Asset Purchase Agreement (this “Agreement”) is made and entered into as of this 15th day of October, 2004, by and among Spectrum Control, Inc., a Pennsylvania corporation (“Buyer”) and REMEC, Inc., a California corporation (“Seller”).

 

RECITALS

 

A. Seller carries on the business of manufacturing and selling radio frequency and microwave components through its unincorporated components business unit (the “Business”) and desires to sell, on a going concern basis, certain of the assets and liabilities of the Business.

 

B. Buyer desires to purchase such assets and liabilities from Seller on the terms and conditions set forth in this Agreement.

 

C. Seller and Buyer further desire to contemporaneously enter into at the Closing (i) a Manufacturing Agreement whereby Seller shall manufacture certain components and Buyer shall purchase such products pursuant to the terms of such agreement, (ii) a Sublease Agreement whereby Buyer will sublease certain premises at Buyer’s facilities in Milpitas, California pursuant to the terms of such agreement, (iii) a License Agreement whereby Buyer would license to Seller certain intellectual property comprised within the Assets and (iv) an Information Technology Services Agreement whereby Seller provides certain short-term information technology services to Buyer.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants set forth below, and subject to the terms and conditions set forth herein, the parties agree as follows:

 

ARTICLE 1

DEFINITIONS

 

As used in this Agreement, the following terms shall have the meanings indicated below:

 

2004 Orders” shall have the meaning set forth in Section 2.4(b)(i).

 

2005 Orders” shall have the meaning set forth in Section 2.4(b)(ii).

 

Accrued Benefits” shall have the meaning set forth in Section 2.3(a)(ii).


Affiliate” shall mean, in respect of any specified Person, any other Person that, directly or indirectly, controls, is controlled by or is under common control with, such specified Person.

 

Affiliated Parties” shall have the meaning set forth in Section 8.2.

 

Agreement” shall have the meaning set forth in the Preamble.

 

Ancillary Agreements” shall have the meaning set forth in Section 2.7(a)(vi).

 

Assets” shall have the meaning set forth in Section 2.1.

 

Assignment and Assumption Agreement” shall have the meaning set forth in Section 2.7(a)(iii).

 

Assumed Contracts” shall have the meaning set forth in Section 2.1(e).

 

Assumed Liabilities” shall have the meaning set forth in Section 2.3(a).

 

Assumed Payables” shall mean the obligations and liabilities of Seller relating exclusively to the Business under purchase orders or other Contracts as of the Closing Date that are not past due more than 60 days beyond the payment terms due date (but, for clarification, not any obligations, costs or expenses of Seller relating to the transactions provided for in this Agreement) as well as Seller’s obligations and liabilities for ad valorem real and tangible personal property taxes that have accrued or are accruing but are not past due more than 60 days beyond payment terms due date (the aggregate amount the tax bill for such real estate taxes for 2003 was $32,411.84 and for personal property taxes for 2003 was $47,047).

 

Audited Financials” shall have the meaning set forth in Section 3.7.

 

Balance Sheet” shall have the meaning set forth in Section 4.3.

 

Balance Sheet Date” shall mean June 30, 2004.

 

Benefit Arrangement” shall have the meaning set forth on Section 4.14(a).

 

“Benefit Plan” shall have the meanings set forth in Section 4.14(a).

 

Bill of Sale” shall have the meaning set forth in Section 2.7(a)(ii).

 

Bulk Sales Laws” shall have the meaning set forth in Section 2.9.

 

Business” shall have the meaning set forth in the Recitals; provided, however, that for purposes of clarification, the term “Business” shall not include Seller’s ODU/TRX business unit, Seller’s Power Amplifier business unit, nor the current activities of Seller’s components business unit relating to the manufacture of products exclusively for Seller’s ODU/TRX business unit or its Power Amplifier business unit.


Business Material Adverse Effect” shall mean any change or effect that is, individually or in the aggregate, materially adverse to the business, operations, assets, condition (financial or otherwise) or results of operations of the Business other than any change or effect (a) relating to the economy of the United States of America in general, (b) relating to the industry in which the Business operates in general and not specifically relating to the Business, (c) arising out of the announcement or pendency of the transactions contemplated by this Agreement, (d) arising out of compliance by Seller with the terms of this Agreement, (e) arising out of any action taken or announced by Buyer or taken or announced by Seller at the request or direction of Buyer, or any inaction or failure to act by Seller at the request or direction of Buyer, (f) arising out of any failure of the Business to achieve projected revenue or operating results (provided, however, that in the event a separate event that independently qualifies as a

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