Initial Public Offering (IPO): Registration Statement (General Form) — Form S-1
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-1 Registration Statement (General Form) 112 656K
9: EX-10.10 Amendment No. 2 to Loan and Security Agreement 10 32K
10: EX-10.11 Pledge Agreement, Made as of March 31, 1995 17 46K
11: EX-10.12 Pledge Agreement, Made as of March 31, 1995 16 45K
12: EX-10.13 Subordination Agreement, Dated March 31, 1995 9 34K
13: EX-10.14 Unconditional Guaranty, Made March 31, 1995 12 35K
14: EX-10.15 Subordinated Note, Dated March 31, 1995 16 68K
15: EX-10.16 Subordinated Note, Dated March 31, 1995 11 45K
16: EX-10.17 Form of Distribution Agreement 19 54K
17: EX-10.18 Form of Amendment Agreement 15 24K
18: EX-10.19 Addendum to Form of Distribution Agreement 4 18K
19: EX-10.22 Employment Agreement:Adzia 9 40K
20: EX-10.23 Employment Agreement:Garcia De Quevedo 16 40K
21: EX-10.24 Employment Agreement: Andruskiewicz 9 39K
22: EX-10.25 Employment Agreement:Foley 13 38K
2: EX-10.3 Stock Subscription Warrant, Dated March 31, 1995 26 96K
3: EX-10.4 Agreement Dated November 10, 1994 88 268K
4: EX-10.5 Purchase Agreement Amendment Dated Feb. 24, 1995 25 72K
5: EX-10.6 Second Purchase Agreement Amendment 2 15K
6: EX-10.7 Third Purchase Agreement Amendment 2 14K
7: EX-10.8 Loan and Security Agreement Dated March 31, 1995 185 566K
8: EX-10.9 Amendment No. 1 to Loan and Security Agreement 8 26K
23: EX-21.1 Subsidiaries of the Company 1 8K
24: EX-23.1 Consent of Kpmg Peat Marwick LLP 1 9K
25: EX-23.2 Consent of Price Waterhouse LLP 1 8K
26: EX-27.1 Financial Data Schedule 1 11K
EX-10.5 — Purchase Agreement Amendment Dated Feb. 24, 1995
Exhibit Table of Contents
Exhibit 10.5
PURCHASE AGREEMENT AMENDMENT
Amendment dated February 24, 1995 to Agreement for the Purchase and
Sale of the National Accounts Division of the Martin-Brower Company and
Martin-Brower of Canada, Ltd. dated November 10, 1994 (the "Agreement") among
The Martin-Brower Company, a corporation organized under the laws of Delaware
and Martin-Brower of Canada, Ltd., a corporation organized under the laws of
Ontario, Canada (collectively the "Sellers"), and ProSource, Inc., a corporation
organized under the laws of Delaware (the "Buyer").
The Agreement is hereby amended as follows:
1. The definition of "Fiscal Closing Date" in Section 1.1 of the
Agreement is amended to read in its entirety as follows :
"Fiscal Closing Date" means each of December 30, 1994, January
27, 1995, February 24, 1995 and March 31, 1995.
2. Section 1.1 of the Agreement is amended to add the following new
definition:
"Note and Warrant" means a subordinated note and a warrant
issued by the Buyer to The Martin-Brower Company having the terms
set forth in Annex 1.1N.
3. The definition of "Termination Date" in Section 1.1 of the
Agreement is amended to read in its entirety as follows:
"Termination Date" means March 31, 1995.
4. Section 2.1 of the Agreement is amended to read in its entirety
as follows:
2.1 Agreement to Purchase. In reliance upon the representations and
warranties of the Buyer contained herein, and on the terms and subject to
the conditions herein set forth, the Sellers agree to sell and deliver the
Assets to the Buyer, and transfer the Liabilities. In reliance upon the
representations and warranties of the Sellers contained herein, and on the
terms and subject to the conditions herein set forth, the Buyer agrees to
purchase, or cause to be purchased, the Assets and assume the Liabilities.
In consideration of the sale of the Assets, the Buyer agrees to pay an
aggregate purchase price of One Hundred Thirty-Two Million Dollars
($132,000,000) (the "PURCHASE PRICE"),
of which One Hundred Twenty-Two Million Dollars ($122,000,000) shall be
payable in cash at the Closing and Ten Million Dollars $(10,000,000) shall
be payable by delivery of the Note and Warrant at the Closing.
Simultaneously with the execution and delivery of this Agreement, Onex
Corporation is entering into the Funding Agreement attached hereto as
Annex 2.1.
5. Section 2.3 of the Agreement is amended to read in its entirety
as follows:
2.3 Payment of Purchase Price. At Closing, the Buyer or its
Designated Transferee shall pay the Purchase Price by (i) delivering the
Note and Warrant to Sellers and (ii) delivering by wire transfer of
immediately available funds to the account of The Martin-Brower Company,
for the benefit of the Sellers, One Hundred Twenty-Two Million Dollars
($122,000,000). The wire transfer shall be made to Citibank, N.A., 399
Park Avenue, ABA 021000089, Account Number 40590527; provided, however,
that the Sellers may designate an alternative account by notice to Buyer
at least five business days prior to the Closing Date.
6. Section 2.7(b) of the Agreement is amended to read in its
entirety as follows:
(b) The Sellers shall use reasonable efforts, and the Buyer shall
cooperate with the Sellers (i) to obtain the consents and waivers
necessary to convey to the Buyer all of the Restricted Assets, and (ii) to
promptly convey to the Buyer the Restricted Assets for which the Sellers
have received the necessary consents and waivers; provided, however, that
any consideration paid therefor to the person from whom the consent or
waiver is requested for the use of any Restricted Asset by both the Buyer
and at least one of the Sellers and their affiliates (other than any
Restricted Asset required to permit Buyer to provide services to Sellers
under the Services Agreement) shall be borne by the Sellers; provided,
further, that any consideration paid therefor with the approval of the
Buyer and the Sellers to the person from whom the consent or waiver is
requested for the use of any Restricted Asset by both the Buyer, and at
least one of the Sellers and their affiliates pursuant to the Services
Agreement, or any consideration paid therefor with the approval of the
Buyer and the Sellers to the person from whom the consent or waiver is
requested for any other Restricted Asset, shall be borne equally by the
Buyer and the Sellers; provided, further, that the Sellers shall not amend
or change any Restricted Asset without the prior written consent of the
Buyer. The Sellers shall cooperate with the Buyer in making applications
and filings or taking
-2-
any other action necessary for the Buyer to obtain such franchises,
licenses, permits or other instruments or agreements, if any, as are
substantially equivalent to the Restricted Assets.
7. Section 4.1(c) of the Agreement is amended to read in its
entirety as follows:
(c) Within five Business Days after the determination of the Net
Assets Sold of the Business in accordance with paragraphs (a) and (b)
above, the Buyer shall pay to the Sellers the amount, if any, by which the
Adjusted Purchase Price exceeds the Purchase Price; or the Sellers shall
pay to the Buyer the amount, if any, by which the Adjusted Purchase Price
is less than the Purchase Price. Any payment pursuant to this Section
4.1(c) shall include interest thereon at the prime rate announced by
Citibank, N.A. from time to time, accruing on such payment amount from the
Closing Date until paid. Such payment shall be made by wire transfer to an
account designated in writing to the obligated party by the receiving
party. The "ADJUSTED PURCHASE PRICE" of the Business shall be an amount
equal to (i) the Net Assets Sold of the Business on the Closing Date,
which shall be equal to total Assets minus total Liabilities of the
Business as reflected on the Statement of Net Assets Sold agreed by the
parties pursuant to Section 4.1(a), or as determined by Deloitte & Touche
pursuant to Section 4.1(b), plus (ii) Twelve Million Dollars
($12,000,000).
8. Section 7.7(e) of the Agreement is amended to read in its
entirety as follows:
(e) Welfare Plan. Effective as of the Closing Date the Sellers shall
cause each Hired Employee to cease to participate in each welfare benefit
plan sponsored by the Sellers. The Sellers shall be liable for all claims
incurred for treatments actually provided or services actually rendered,
whether submitted or not, prior to Closing Date for Non-Hired Employees
and prior to effective date of hire for Hired Employees. The Buyer shall
offer participation under its welfare plan to all Hired Employees in
accordance with the terms of the plans giving the Hired Employees credit
for all years of service for employment with the Sellers including all
years of service with Sellers under any applicable vacation pay policy of
the Buyer. The Sellers shall satisfy any requirements of the Consolidated
Omnibus Budget Reconciliation Act of 1985 ("COBRA") for Non-Hired
Employees who were offered employment with the Buyer with compensation at
the Employee's current rate of pay and benefits, taken as a whole, equal
or greater in cost value
-3-
to the benefit provided by the Sellers on the Closing Date. The Buyer
shall satisfy any requirements of COBRA for Hired Employees and Non-Hired
Employees who are not offered employment with Buyer with compensation at
Employee's current rate of pay or benefits, taken as a whole, with equal
or greater cost value than the benefits provided by Sellers on Closing
Date. Payments made by Hired Employees during the current plan year toward
the Sellers' medical plan deductibles shall be credited toward any
deductible requirement in the Buyer's medical plan for the concurrent or
overlapping plan year.
9. Section 7.10 of the Agreement is amended to read in its entirety
as follows:
7.10 Trademark. The Buyer and the Sellers shall, at the Closing,
enter into the Trademark License Agreement attached as Annex 7.10.
10. Section 7.11 of the Agreement is amended to read in its entirety
as follows:
7.11 Environmental Inspection. The Buyer has had the right to
inspect or test, or, at its sole cost and expense, contract with a third
party to inspect and test the Owned Real Property, Leased Real Property
and other Assets (at reasonable times), for purposes of confirming the
presence of all required Permits, assessing compliance with Environmental
Laws and determining whether any Hazardous Substance is present. If the
Buyer asserts or claims that there has been a breach of the
representations and warranties in Section 5.23, as a result of any reports
prepared at the request of the Buyer by any third parties, then the Buyer
shall, upon request of the Sellers, deliver copies to the Sellers' counsel
of all such reports upon which such assertion or claims are based.
11. Section 8.8 of the Agreement is deleted in its entirety.
12. Section 11.6 of the Agreement is amended to read in its entirety
as follows:
11.6 Limitations as to Amount -- Sellers. Sellers shall have no
liability (for indemnification or otherwise) with respect to any matter
described in clause (i) or (ii) of Section 11.3 until the total of all
such Damages exceeds $750,000, and then only for the amount by which such
Damages exceed $750,000. Sellers' liability for Damages with respect to
any matters described in clauses (i) or (ii) of Section 11.3 or any matter
described in Section 11.4 shall not exceed $78,000,000 in the aggregate.
However, this
-4-
section shall not apply to (a) any intentional misrepresentation or any
intentional breach of warranty or (b) any intentional failure to perform
or comply with any agreement contained in this Agreement, and Sellers
shall be liable for all Damages with respect thereto.
13. Section 11.7 of the Agreement is amended to read in its
entirety as follows:
11.7 Limitations as to Amount -- the Buyer. The Buyer shall have no
liability (for indemnification or otherwise) with respect to any matters
described in clause (i) or (ii) of Section 11.5 until the total of all
such Damages exceeds $750,000 and then only for the amount by which such
Damages exceed $750,000. Buyer's liability for Damages with respect to any
matters described in clauses (i) or (ii) of Section 11.5 shall not exceed
$78,000,000 in the aggregate. However, this section shall not apply to (a)
any intentional misrepresentation or intentional breach of warranty or (b)
any intentional failure to perform or comply with any agreement contained
in this Agreement, and the Buyer shall be liable for all Damages with
respect thereto.
14. The Agreement is amended to add Schedule 2.7 in the form
attached to this Amendment, with the prior Schedule 2.7 deleted in its entirety.
In the event that the consent received for any real or personal property listed
on the original Schedule 2.7 is not valid on the Closing Date, such property
shall be listed in the revised Schedule 2.7.
15. A new Section 13.15 is added to the Agreement as follows:
13.15 Right to Entertain Offers. Notwithstanding any other provision
of this Agreement, Sellers shall have the absolute right to entertain
discussions with respect to the sale of the Business with parties other
than the Buyer. Without limiting the generality of the foregoing, such
right shall include a right to provide any potential purchaser of the
Business with any documents, work papers and other materials in the
possession of the Sellers relating to the Business, whether or not
confidential, so long as the provision of such information is subject to
comparable confidentiality limitations as those set forth in Section 13.14
of the Agreement. The parties expressly agree that entertainment of offers
and provision of information by the Sellers in the manner set forth herein
shall not constitute a violation or breach of this Agreement by the
Sellers. In the event that prior to the Closing Date the Sellers receive a
bona fide offer from a financially responsible party to purchase the
Business at a price (and a cash component thereof) equal to or greater
than the Purchase Price (and
-5-
the cash component thereof) pursuant to a definitive agreement (the
"Alternate Agreement"), Sellers shall have the absolute right (the
"Alternate Agreement Termination Right"), with no liability to the Buyer,
to give notice to Buyer that this Agreement will terminate concurrently
with the execution and delivery of the Alternate Agreement on a date, not
earlier that two Business Days after such notice is given, specified in
such notice unless Buyer receives a commitment letter as described in the
following sentence. Sellers' Alternate Agreement Termination Right shall
terminate upon receipt by Sellers of a commitment letter in customary form
from Buyer's bank for the financing required for the acquisition of the
Business. Termination of Sellers' Alternate Agreement Termination Right
shall not be interpreted (a) to preclude or restrict Sellers' right to
entertain offers and provide information to potential purchasers of the
Business set forth in this Section 13.15, or (b) to extend the Termination
Date of this Agreement beyond March 31, 1995.
16. The Agreement is amended to add Annex 1.1N in the
form attached to this Amendment.
17. Annex 8.7 of the Agreement is amended to read in its entirety as
attached hereto, with the prior Annex 8.7 deleted in its entirety.
18. The parties agree that notwithstanding any provision contained
in the Agreement (other than Section 8.5), the failure of General Mills to make
a final determination as to the renewal of its customer contract with the
Sellers on or before the Closing Date shall not provide the Buyer with a basis
for refusing to close the transaction contemplated therein.
SELLERS :
THE MARTIN-BROWER COMPANY.
By:/s/ John C. Winton
----------------------------
Its: Sr VP Finance
---------------------------
MARTIN-BROWER OF CANADA, LTD.
By:/s/ John C. Winton
----------------------------
Its: Director
---------------------------
-6-
BUYER:
PROSOURCE, INC.
By:/s/ D. R. PARKER
----------------------------
Its: Chairman
---------------------------
-7-
SCHEDULE 2.7
Restricted Assets
PART A. : Consents to Assignment Constitute Conditions Precedent
to Closing
1. Assignment of Following License and Service Agreements
Requires Approval of Buyer
a. Dun & Bradstreet Software Services, Inc. (McCormack &
Dodge):
- License and Maintenance Agreement. (Millennium)
b. Manugistics. Inc., formerly STSC:
- Agreement for Consulting and Programming Services and Work
Assignment Schedule dated 9/13/83
- Agreement for APL*Plus Time Sharing Services and TRUCKS
Supplement, dated 9/13/83
- Work Assignment Schedule dated 6/18/87
- Amended and Restated Software License Agreement dated 2/12/88
- Addendum to Software License Agreement dated 2/12/88 and Letter
dated 12/4/91
c. Computer Associates:
- License Agreement for Program Product dated 3/15/89 (CA-DYNAM/T VM
and VSE)
- Pansophic Systems, Inc. Software License Agreement dated 10/12/90
(Warehouse BOSS)
- Order Form 3/31/93 (Warehouse BOSS)
d. Analysis, Inc. (CATOC Systems) :
- Proposal for the Implementation of the CATOC Transportation
Software System dated 9/2/92
- Software Agreement dated 9/2/92
- Software Support Agreement dated 9/2/92
e. CompuServe:
- Network Services Agreement
f. Sterling Software (Netmaster):
- License
g. Xerox Corporation:
- Agreement for Maintenance of 2 Printers
2. Equipment Lease Contracts
a. MetLife Capital, Limited Partnership:
- Motor Vehicle Lease Agreement (Trailers) dated 2/4/87
b. MCC Leasing/Trust No. 92-01:
- Motor Vehicle Lease Agreement (Trailers)
Draft dated 2/2/95 approved by all parties; awaiting execution copies.
3. Real Estate Leases and Sidetrack Agreements
a. 1020 31st Street, Downers Grove, Illinois
- 6th Floor Lease dated 11/30/93
- Lower Level Lease dated 5/31/94
b. 4600 South Austin Avenue, Chicago, Illinois
- Office Lease dated 11/22/77
c. CENTER 04 - ATLANTA, GEORGIA
5155 Welcome All Road
Atlanta, GA 30349
- Warehouse Lease and Construction Agreement dated 9/14/90, as
amended
- Sidetrack Agreement with CSX Transportation
d. CENTER 45 - CHESTER, NEW YORK
65 Leone Lane
Chester, NY 10918
- Warehouse Lease and Construction Agreement dated 2/17/86
e. CENTER 25 - COLUMBUS, OHIO
4465 Industrial Center Drive
Village of Obetz, OH 43207
- Warehouse Lease and Construction Agreement dated 9/9/92
- Sidetrack Agreement with CSX Transportation
f. CENTER 09 - DALLAS, TEXAS
1603 North Gardenridge Blvd.
Lewisville, Texas 75067
- Commercial Lease dated 10/3/88
- Standard Industrial Net Lease dated 9/4/91
- Standard Commercial Lease dated 4/1/94
- Sublease dated 7/20/93
g. CENTER 18 - WASHINGTON, D.C.
425 Lee Hill Drive
Fredericksburg, VA 22408
- Sidetrack Agreement with CSX Transportation
h. CENTER 03 - LOS ANGELES, CALIFORNIA
5598 Lindbergh Lane
City of Bell, CA 90201
- Lease Agreement dated 3/6/80, as amended
-2-
i. CENTER 43 - LOS ANGELES, CALIFORNIA
145 North Willow
City of Industry, CA 91746
- Industrial Real Estate Lease dated 1/20/92
j. CENTER 22 - PORTLAND , OREGON
13130 N.E. Airport Way
Portland, OR 97230
- Standard Industrial Lease dated 7/28/89
k. CENTER 33 - TRENTON, ONTARIO
160 North Murray Street
Trenton, Ontario
- Lease dated 12/91
- Agreement dated 11/8/91
4. Owned Real Estate Sidetrack Agreements
a. CENTER 19 - ORLANDO, FLORIDA
1090 Gills Drive
Orlando, Florida 32824
- Sidetrack Agreement with CSX Transportation
b. CENTER 01 - GRIDLEY, ILLINOIS
202 North Ford Street
Gridley, , Illinois 61744
- Sidetrack Agreement with T, P & W
5. Agreements in Form Approved by Buyer Requiring Third Party
Signature Only
a. Access International:
- Agreement
b. Anacomp, Inc.
- Agreement (Microfiche)
c. IBM:
- IBM Customer Agreement
d. Information Builders, Inc. :
- License (FOCUS software)
e. Integral Systems
- License for A/P Program
f. Macro 4, Inc. :
- License
g. Phoenix Software Company:
- License Agreement for Phoenix Software Products (DOS FALCON/PLUS)
h. Premenos Corp.:
- License
i. Sentinel Computer Services:
- Maintenance Agreement
j. Software Diversified Services:
- License Agreement
-3-
k. The Associates:
- Transfer and Assumption Agreement
l. Deutsche Credit Corporation:
- Consent to Assignment
6. Assignment of Following Customer Contracts Requires Buyer
Signature Only
a. Long John Silver's
- Agreement dated 4/7/94
- Letter Agreements re: Fish Stockpiling and Buy-Ins
7. Consents to Assignment Requiring Acknowledgment of
Modifications Only
a. Sterling Software (VM software, Inc.):
- License Agreement with Amendment dated 8/23/88
b. Pitney Bowes Credit Corp. :
- Master Equipment Lease Agreement dated 3/9/89
- Revised Addendum "B" Stipulated Loss Values (Trailers) dated
1/17/90
c. John Hancock Leasing Corp. :
- Master Lease dated 7/16/91
- Acceptance Supplement (Trailers) dated 11/18/91
d. Data Exchange:
- Lease Agreement (computers) dated 12/21/87
e. Tandet Eastern Limited:
- Vehicle Lease
PART B. : Consents to Assignment not a Condition Precedent to Closing
1. License and Service Agreements in Form Approved by Buyer
requiring third party Signature Only
a. Data Base of Chicago, Inc. :
- Service Agreement dated June 30, 1988
b. Dell Marketing I.P.
- Corporate Performance Agreement
-4-
ANNEX 1.1N
PROSOURCE, INC./THE MARTIN-BROWER COMPANY
SUMMARY OF TERMS OF SUBORDINATED NOTE AND WARRANT
Subordinated Note:
Principal amount $10,000,000
Maturity March 31, 2002
Amortization of
principal None
Interest Rate: 0% in year 1; 4% per
annum in years 2 and 3; 7% per
annum in year 4; 10% per annum
in year 5; and 13% per annum
in years 6 and 7. Payment:
PIK in years 2 and 3; semi-
annual thereafter .
Subordination Subordinate to all bank and
other third party indebtedness
for money borrowed on terms
satisfactory to the senior
bank lenders. Senior in
liquidation and upon default
to subordinated indebtedness
provided by affiliates.
Security None
Covenants As Per Attachment
Transfer First refusal in favor of
Onex. No transfer to a person
engaged in the food
distribution business or the
fast food or casual dining
restaurant business.
Events of Default As Per Attachment
Warrant :
Securities subject to 5% of the fully-diluted common
purchase stock of ProSource, Inc., as
of, and giving effect to
common stock and options
issued in connection with, the
closing of the acquisition
Exercise price $3,500,000.00
Payment If both the subordinated note
and the warrant are held by
Dalgety PLC or one of its
subsidiaries, at the option of
the holder, the exercise price
of the warrant may be paid
with part or all of the
subordinated note, valued at
its then fair market value
Exercise period April 1, 1997 to March 31, 2000. Exercisable
prior to that period in connection with a
public offering by or sale of ProSource, Inc.
Anti-dilution Adjustment for stock
dividends, stock splits,
recapitalizations and the like
Transfer First refusal in favor of
Onex. No transfer to a person
engaged in the food
distribution business or the
fast food or casual dining
restaurant business
Registration rights The holder of the common stock issued upon
exercise of the warrant will have piggy-back
registration rights on a parity with other
stockholders
Stockholders agreement The holder of the common stock issued upon
exercise of the warrant will have tag-along
rights and be subject to drag-along and first
refusal obligations
-2-
Detachability Warrants can be fully tradable
apart from the underlying
note, subject to the
restrictions above under the
caption "Transfer"
-3-
Attachment to Annex 1.1N
Covenants
1. For each dollar of debt to affiliates/parent or subsidiaries to be
retired/exchanged while the subordinated note is outstanding, Debtor
must retire 66.6 cents of the subordinated note.
2. Holder will have continuing access to financial statements of
debtor.
3. Debtor will maintain corporate existence, pay all required taxes and
fees.
4. Debtor will not claim benefit of any stay, extension or usury law
that may affect its obligation to pay under the subordinated note.
5. Prohibition of dividends prior to repayment of the note in full,
except ordinary dividends in line with comparable companies.
6. Limitations on the sale of substantially all of the assets of the
debtor, unless note retired at face.
7. Restrictions on transactions with affiliates, or investments in
other entities (whether in the form of loans or equity), excluding
the $750,000 per annum (subject to annual increase for increases in
the CPI) management fee to be paid by debtor to Onex Corporation,
which would have the same effect as a prohibited dividend.
Events of Default
1. Failure to pay interest or principal on the note.
2. Breach of any covenant, condition or agreement in the note.
3. Bankruptcy.
4. Cross acceleration.
-4-
ANNEX 7.10
TRADEMARK LICENSE AGREEMENT
This Agreement, executed and entered into this ___ day of ____,
1995, is by and between The Martin-Brower Company, a Delaware corporation,
having its principal place of business at 1020 West 31st Street, Downers Grove,
Illinois 60515-5508 (hereinafter referred to as "Licensor") and ProSource, Inc.,
a Delaware corporation, having its principal place of business at 550 Biltmore
Way, 10th Floor, Coral Gables, Florida 33134 (hereinafter referred to as the
"Licensee") .
WITNESSETH:
WHEREAS, pursuant to that certain Agreement for the Purchase and
Sale of the National Accounts Division of Licensor and Martin-Brower of Canada,
Ltd. by and between Licensee, Licensor and Martin-Brower of Canada, Ltd. dated
November 10, 1994 (the "Purchase Agreement") Licensee agreed to acquire the
Business (as such term is defined in the Purchase Agreement);
WHEREAS, capitalized terms used herein shall have the meanings set
forth in the Purchase Agreement, except as otherwise expressly defined herein;
WHEREAS, Licensor is the owner of the trademark registration listed
in Exhibit A hereto (hereinafter the "Mark"); and
WHEREAS, the Licensee is desirous of using the Mark on the terms and
conditions set forth herein;
NOW, THEREFORE, the parties hereto hereby expressly agree as
follows:
1. LICENSE GRANT.
1.1 License. Subject to the termination provisions contained in
Section 1.3 hereof, and the other terms and conditions set forth herein,
Licensor hereby grants a royalty free, non-exclusive, non-transferable,
perpetual license to the Licensee and its subsidiaries to use the Mark within
the Territory (as hereinafter defined) in the manner specified herein. The
Licensee shall be entitled to use the Mark only in conjunction with the name
ProSource, and in such cases, solely in activities related to the Business, or
such other names as Licensee may use in the conduct of the Business. Except as
provided in Section 1.2 hereof, Licensee shall not have the right to use the
Mark with any coloring or colors that are the same as or confusingly similar to
the dark blue and light blue colors used in the Mark by the Business on the date
hereof. As used
herein the Territory shall mean the United States, Canada and any country in
which the Business was conducted prior to the Closing of the Agreement.
1.2 Interim Use of Other Marks. During the six (6) month period
commencing on the date of this Agreement, Licensee may continue to display on
tractors, trailers, other vehicles and facilities acquired (or the use of which
was acquired) by Licensee under the Purchase Agreement all names, designs, marks
and other Proprietary Rights (collectively "IP Items") displayed on such
tractors, trailers, other vehicles and facilities on the Closing Date.
1.3 Termination. Upon the occurrence of a material breach of or
default under this Agreement by the Licensee, Licensor shall provide written
notice to the Licensee of that breach, and said breach shall be remedied or
cured within sixty days of said notice. If the Licensee does not remedy or cure
such breach or default within such sixty day period, the License granted herein
shall automatically terminate at the end of said sixty day period. In the event
of the termination of the License, the Licensee shall immediately discontinue
all use of the Mark.
1.4 Quality Control. The Licensee shall at all time during the term
of this Agreement in conjunction with the use of the Mark maintain quality
standards at least equal to those provided or established and maintained by
Licensor as of the date hereof with respect to the Business.
1.5 Use of the Mark. Licensee hereby acknowledges and agrees that
(i) the Mark is the exclusive property of Licensor, (ii) it will not do anything
that, to the knowledge of Licensee, could reasonably be expected to invalidate
the Mark or adversely affect Licensor's ownership thereof, and (iii) it will not
during the term of this Agreement or thereafter, except with the prior written
permission of Licensor, obtain or attempt to obtain any registration of the same
Mark or any combination thereof with another name. The Licensee shall use such
appropriate markings as required by applicable law in conjunction with the
Licensee's use of the Mark, so as to show the protected or registered status of
the Mark. The Licensee shall promptly furnish to Licensor upon written request,
at the Licensee's sole expense, samples or photographs of the Licensee's
advertisement and other uses of the Mark. Licensor shall have the right to
review and consent in advance to any use of the Mark by Licensee, such consent
not to be unreasonably withheld or delayed.
-2-
2 INDEMNIFICATION.
2.1 Indemnification by the Licensee. The Licensee hereby expressly
acknowledges and agrees that maintenance of the required minimum quality control
standards as set forth in Section 1.3 is the responsibility of the Licensee. The
Licensee shall indemnify and hold Licensor harmless from all claims, demands,
suits, actions, proceedings, costs, damages, expenses, and/or losses of any kind
(including product liability) resulting from, arising out of, or in connection
with, the Licensee's use of the Mark or interim use of an IP Item pursuant to
the License granted herein, except to the extent resulting from, arising out of
or in connection with any breach of the representations and warranties set forth
in Section 2.2 or any actions, omissions or state of facts inconsistent with
such representations and warranties. The Licensee may, at its own expense,
promptly defend and continue the defense of any such claim, demand, suit, action
or proceeding. If the Licensee fails to retain counsel or to undertake and
continue such defense as aforesaid, Licensor shall have the right to make and
continue such defense as may to it seem appropriate, and the expenses and costs
thereof, including, but not limited to, attorneys' fees, out-of-pocket costs,
and the costs of an appeal and the bond thereof, together with the amount of any
judgment paid by Licensor, shall be paid by the Licensee upon demand. Nothing
hereinbefore stated shall prevent Licensor from defending any such claim,
demand, suit, action or proceeding at its own expense and risk through its own
attorneys, notwithstanding that the defense thereof may have been undertaken by
the Licensee, and the Licensee shall promptly notify Licensor of the
commencement or threatened commencement of any such claim, demand, suit, action,
or proceeding of which it has knowledge.
2.2 Representations/Warranties of Licensor; Indemnification by
Licensor. Licensor represents and warrants with respect to the Mark that (i) to
the knowledge of Licensor, the Mark is duly registered with countries in which
registrations have been filed and issued, (ii) Licensor has no knowledge of any
litigation, proceedings, investigations or claims of any nature pending or
threatened related to the Mark, and (iii) that use of the Mark in accordance
with this Agreement will not violate the rights of any person or entity. Subject
to the limitations on indemnification (both as to amount and time) set forth in
Sections 11.2 and 11.6 of the Purchase Agreement, the Licensor shall indemnify
and hold Licensee harmless from all claims, demands, suits, actions,
proceedings, costs, damages, expenses, and/or losses of any kind resulting from,
arising out of, or in connection with, any breach of the foregoing
representations and warranties or any actions, omissions or state of facts
inconsistent with such representations and warranties. Licensor may, at its own
expense, defend any claim, demand, suit, action or proceeding with respect to
the Mark. If the Licensor fails to
-3-
retain counsel or to undertake and continue such defense as aforesaid, the
Licensee shall have the right to make and continue such defense as it deems
appropriate, and the expenses and costs thereof, including but not limited to,
attorneys' fees, out-of-pocket costs, and the costs of an appeal and the bond
thereof, together with the amount of any judgment paid by the Licensee, shall be
paid by Licensor upon demand. Nothing hereinbefore stated shall prevent Licensee
from defending any such claim, demand, suit, action or proceeding at its own
expense and risk through its own attorneys, notwithstanding that the defense
thereof may have been undertaken by the Licensor, and the Licensor shall
promptly notify Licensee of the commencement of any such claim, demand, suit,
action, or proceeding.
3. REGISTRATION AND ASSIGNMENT.
3.1 Rights Non-Transferable. The Licensee agrees and understands
that this License and the rights granted hereunder are nonassignable and
nontransferable by the Licensee without the express written consent of the
Licensor, which may be determined in Licensor's reasonable discretion.
Notwithstanding the foregoing, Licensor shall have the absolute right to refuse
an assignment of the rights granted hereunder to any transferee which, on the
date of such proposed assignment, is a competitor (whether directly or
indirectly) or Licensor, its ultimate parent, or any subsidiary or affiliate of
such parent. Licensor has the right to assign or transfer its rights in and to
the Mark (subject to the License granted hereunder) to any person, persons,
entity or entities which it deems necessary and proper.
4. MISCELLANEOUS
4.1 Nature of Relationship. Nothing herein contained shall be
construed to place the parties hereto in a relationship of partners or joint
venturers, and neither party shall have the power to obligate or bind the other
in any manner whatsoever.
4.2 Severability. The provisions of this Agreement shall be
severable, and if any provision of this Agreement shall be held or declared to
be illegal, invalid, or unenforceable, such illegality, invalidity, or
unenforceability shall not affect any other provision hereof, and the remainder
of this Agreement disregarding such invalid portion shall continue in full force
and effect as though such void provision had not been contained herein.
4.3 Governing Law. The validity, construction,
interpretation, and enforcement of this Agreement shall be
governed by the laws of the State of Delaware.
4.4 Waiver. The waiver by either of the parties
hereto of any breach of any provision hereof by the other party
-4-
shall not be construed to be either a waiver of any succeeding breach of any
such provision or a waiver of the provision itself.
4.5 Notices. All notices hereunder shall be made as
set forth in Section 13.2 of the Purchase Agreement.
4.6 Heading and Number. The heading for each paragraph of this
Agreement is included for convenience of reference only and is not to be
considered a part hereof, and shall not be deemed to modify, restrict, or
enlarge any of the terms or provisions of this Agreement. Whenever herein the
singular number is used, the same shall include the plural where appropriate .
4.7 Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter hereof,
and supersedes any and all other agreements, understanding, negotiations, or
representations, oral or written, between such parties.
4.5 Execution in Counterparts. This Agreement and any amendments
thereto shall be executed in multiple counterparts. Each counterpart shall be
deemed an original, but all counterparts together shall constitute one and the
same instrument .
4.9 Amendment. No terms or provision contained herein shall be
amended, modified or varied, except in writing signed by the parties hereto.
IN WITNESS WHEREOF, the parties hereto have subscribed hereto
through their duly authorized officers as of the date first written above.
ProSource, Inc.
By:_______________________
Print Name: ___________________
Print Title: _________________
The Martin-Brower Company
By:_______________________
Print Name:__________________
Print Title: __________________
-5-
EXHIBIT A
The Mark
MB, including those letters in the style currently used by the
Business, except with any coloring or colors that are the same as or confusingly
similar to the dark blue and light blue colors used by the Business on the date
hereof.
-6-
ANNEX 8.7
________________ 1995
Prosource, Inc.
550 Biltmore Way, 10th Floor
Coral Gables, Florida 33134
Re: National Accounts Division of The Martin-Brower
Company and Martin-Brower of Canada, Ltd.
Ladies and Gentlemen:
We have acted as special counsel to The Martin-Brower Company ("MBC") , a
Delaware corporation, and Martin-Brower of Canada, Ltd ("MBCL"), a corporation
organized under the laws of Ontario, Canada (collectively, the "Sellers"), in
connection with the execution and delivery of the Agreement for the Purchase and
Sale of the National Accounts Division of The Martin-Brower Company and
Martin-Brower of Canada, Ltd., dated November 10, 1994 (as amended on February
24, 1995, the Agreement") , entered into by and between ProSource, Inc., a
Delaware corporation (the "Buyer"), and the Sellers pertaining to the sale by
the Sellers of the National Accounts Division of the Sellers, and certain other
agreements, instruments and documents related to the Agreement. This opinion is
being delivered pursuant to Section 8.7 of the Agreement. capitalized terms used
herein and not otherwise defined herein shall have the same meanings herein as
ascribed thereto in the Agreement.
In our examination we have assumed the genuineness of all signatures
including indorsements, the legal capacity of natural persons, the authenticity
of all documents submitted to us as originals, the conformity to original
documents of all documents submitted to us as certified or photostatic copies,
and the authenticity of the originals of such copies. As to any facts material
to this opinion which we did not independently establish or verify, we have
relied upon statements and representations of the Sellers and of BroMar
Services, Inc. (the "Company") and its officers and other representatives and of
public officials, including the facts set forth in the Officer's certificate
described below.
In rendering opinions set forth herein, we have examined and relied on
originals or copies of the following:
(a) the Agreement;
(b) the Assignment and Assumption Agreement, the Trademark License
Agreement, and the Service Agreement;
(c) certificate of the Sellers executed by dated
the date hereof;
(d) copies of the Articles of Incorporation and By-
laws of the Sellers and the Company;
(g) certificate from public officials in the state of
Delaware and Illinois as to the good standing of the Company
in each such jurisdiction; and
(h) such other documents as we have deemed necessary or appropriate
as a basis for the opinions set forth below.
The Agreement and the Assignment and Assumption Agreement, the
Trademark License Agreement, and the Service Agreement shall hereinafter be
referred to collectively as the "Documents". References to (i) "Applicable Laws"
shall mean those laws, rules and regulations of the State of Illinois and of the
United States of America which, in our experience, are normally applicable to
transactions of the type contemplated by the Documents; (ii) the term
"Governmental Authorities" means any Illinois or federal executive, legislative,
judicial, administrative or regulatory body; (iii) the term "Governmental
Approval" means any consent, approval, license, authorization or validation of,
or filing, recording or registration with, any Governmental Authority pursuant
to Applicable Laws of the State of Illinois and the United States of America to
the extent specifically referred to herein; (iv) the term "Applicable Orders"
means those orders or decrees of Governmental Authorities identified on Schedule
II to the Officer's Certificate; and (v) "Applicable Contracts" mean those
agreements or instruments set forth on Schedule III to the officer's Certificate
and which have been identified to us as all the agreements and instruments which
are material to the business or financial condition of the Company.
The law covered by the opinions expressed herein is limited to the
federal law of the United States and the law of the State of Illinois. We
express no opinion as to the laws of any other jurisdiction. In this respect we
call to your attention that certain of the transaction documents are governed by
laws of jurisdictions other than those described above and have rendered the
opinions herein as if such documents were governed by the laws of the State of
Illinois; we express no opinion as to the effect of any such other laws on the
opinions expressed herein.
Our opinions are also subject to the following assumptions and
qualifications:
-2-
(a) each of the Documents constitutes the legal, valid and binding
obligation of each party to the Documents (other the Sellers) enforceable
against such parties (other than the Sellers) in accordance with their terms;
(b) we express no opinion as to the effect on the opinions herein
stated of (i) the compliance or non-compliance of any party (other than the
Company) to the Documents with any state, federal or other laws or regulations
applicable to them or (ii) the legal or regulatory status or the nature of the
business of such other parties.
(c) In rendering our opinions expressed below, we express no opinion
as to the applicability or effect of any fraudulent transfer, bankruptcy
preference or similar law on the Documents or any transactions contemplated
thereby;
(d) In rendering our opinions expressed below, we express no opinion
as to the applicability or effect of any preference or similar law on the
Documents or any transaction contemplated thereby;
Based upon the foregoing and subject to the limitations,
qualifications, exceptions and assumptions set forth herein, we are of the
opinion that:
1. The Agreement, the Assignment and Assumption Agreement, the
Trademark License Agreement and the Service Agreement constitute binding
obligations of the Sellers, enforceable against them in accordance with their
respective terms, subject to the following qualifications:
(i) enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors' rights
generally and by general principles of equity (regardless of whether enforcement
is sought in equity or at law);
(ii) we express no opinion as to: the enforceability of any rights
to contribution or indemnification provided for in the Documents which are
violative of the public policy underlying any law, rule or regulation (including
any federal or state securities law, rule or regulation);
(iii) we express no opinion with respect to the enforceability of
Section 7.13 of the Agreement to the extent it states that the provisions of the
Documents are severable;
-3-
(iv) we express no opinion with respect to the enforceability of the
covenants contained in Section 13.7 of the Agreement which are violative of the
public policy underlying any law, rule or regulation; and
(v) we express no opinion with respect to the enforceability of
Section 13.11 of the Agreement to the extent it states that the parties waive
all right to a trial by jury.
2. Execution and delivery by the Sellers of, and performance of, the
Agreement, the Assignment and Assumption Agreement, the Trademark License
Agreement and the Service Agreement do not (i) violate the terms of the
constituent documents of the sellers, (ii) breach or otherwise violate any
existing obligation of the Sellers under a Court Order listed in the attached
officer's certificate or (iii) violate applicable provisions of statutory law or
regulations .
3. Except as set forth on Schedule 5.3 to the Agreement, no
approval, authorization or other action by, or filing with, any governmental
authority, is required for the valid execution and delivery by the Sellers of,
and performance of their agreements in, the Agreement, the Assignment and
Assumption Agreement, the Trademark License Agreement and the Service Agreement.
4. The Company, a wholly-owned subsidiary of MBC, has been duly
incorporated and is validly existing and in good standing under the laws of the
State of Delaware and is in good standing as a foreign corporation in Illinois.
The Company has the corporate power and authority to conduct its business .
5. The Company's authorized capital stock consists of _____________
shares of common stock, par value ________ per share of which 2000 shares are
issued and outstanding and held of record by MBC.
This opinion is being furnished only to you and is solely for your
benefit and is not to be used, circulated, quoted, relied upon or otherwise
referred to for any purpose without our prior written consent. We hereby consent
to the delivery of this opinion to the lenders providing the financing
contemplated by Section 8.5 of the Agreement.
Very truly yours,
-4-
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘S-1’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| | 3/31/02 | | 12 | | | | | None on these Dates |
| | 3/31/00 | | 13 |
| | 4/1/97 | | 13 |
| Filed on: | | 9/6/96 |
| | 3/31/95 | | 1 | | 6 |
| | 2/24/95 | | 1 | | 22 |
| | 1/27/95 | | 1 |
| | 12/30/94 | | 1 |
| | 11/10/94 | | 1 | | 22 |
| List all Filings |
↑Top
Filing Submission 0000950123-96-004896 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)
Copyright © 2024 Fran Finnegan & Company LLC – All Rights Reserved.
About — Privacy — Redactions — Help —
Thu., Apr. 25, 12:12:24.1am ET 