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EXHIBIT 10.54
ASSET PURCHASE AGREEMENT
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ASSET PURCHASE AGREEMENT
THIS ASSET
PURCHASE AGREEMENT (this "Agreement") is entered into on
December 31, 2004 by and between EYEGLASS
EMPORIUM, INC., an Indiana
corporation ("Seller") (a wholly owned
subsidiary of Sight Resource Corporation,
a Delaware corporation ("SRC")), RX OPTICAL
LABORATORIES, INC., a Michigan
corporation qualified to do business in the
State of Indiana ("Buyer"), and SRC,
which enters into this Agreement for the
sole purpose of being bound by the
provisions of Section 5 below:
RECITALS:
A.
WHEREAS, Seller is in the business of marketing and selling to
the
general public at six retail eye care
centers in the State of Indiana (the
"Centers") eyeglass frames and lenses,
contact lenses and related eyewear
accessories (the "Business"); and
B.
WHEREAS, Seller and Buyer have agreed, on the terms and subject to
the
conditions of this Agreement, that Seller
shall sell to Buyer, and Buyer shall
purchase from Seller, substantially all of
the assets owned and used by Seller
in the conduct of the Business; and
C. WHEREAS, on June
24, 2004 Seller filed in the United States Bankruptcy
Court for the Southern District of Ohio
(the "Bankruptcy Court") a voluntary
petition for relief under Title 11 of
Chapter 11 of the United States Code (the
"Bankruptcy Code") and Seller and Buyer
also have agreed that this Agreement
shall be subject to the approval of the
Bankruptcy Court pursuant to Section 363
of the Bankruptcy Code so that, inter alia,
the Assets (as defined in Section 1
below) can be conveyed by Seller to Buyer
free and clear of any interests other
than the Assumed Liabilities (as defined in
Section 3.2 below).
NOW,
THEREFORE, in consideration of the mutual undertakings herein,
and
other good and valuable considerations, the
receipt and sufficiency of all of
which the parties hereby acknowledge, it is
agreed that:
1.
PURCHASE AND SALE OF ASSETS.
1.1 Subject Assets. Subject to approval of the Bankruptcy Court
and
the entry of the Sale Order (as defined in
Section 9.1 below), on the terms and
subject to the conditions of this
Agreement, at the Closing (as defined in
Section 6 below) Buyer shall purchase from
Seller and Seller shall sell,
transfer, convey and deliver to Buyer all
of Seller's direct and indirect
rights, titles and interests in and to the
following tangible and intangible
property owned, leased or otherwise used by
Seller in connection with the
operation of the Business (the
"Assets"):
(a) Inventory. All eyeglass frames and lenses, contact lenses,
related eyewear accessories and other
inventory owned by Seller and located in
or at the Centers;
(b) FFE. All office furniture and equipment, optical
equipment, appliances, display cases,
fixtures, supplies, accessories and other
tangible personal property located in or at
the Centers including, without
limitation, the personal property described
on the attached Exhibit A (the
"FFE");
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(c) Leases. All real property leases for the Centers
identified on the attached Exhibit B (the
"Store Leases") together with all
security deposits held by lessors or
landlords in accordance with the provisions
of each Store Lease;
(d) Contracts. All managed care contracts, all written
agreements with doctors of optometry (the
"Doctor Agreements") listed on the
attached Exhibit C and other written or
oral customer contracts, agreements and
commitments (including customer deposits)
(together with the Doctor Agreements,
the "Assumed Contracts");
(e) Intellectual Property. The name "Eyeglass Emporium" and
all related service marks, logos and other
proprietary rights and intellectual
property under, by and through which Seller
conducts the Business including,
without limitation: (i) the United States
registered service mark "Eye Glass
Emporium", serial number 73692008 filed
October 26, 1987 in the United States
Patent Office; (ii) all advertising devices
displaying the Eyeglass Emporium
service mark including, without limitation,
all signs, kiosks and other
advertising media; (iii) all stocks of
business forms and promotional pass out
literature that contains or makes reference
to Eyeglass Emporium; and (iv) all
presently existing telephone numbers for
each of the Centers to the extent such
numbers are transferable (the "Intellectual
Property"); and
(f) Books and Records. All books and records including,
without limitation, Seller's hard copies
and electronic versions of the
accounting records, customer lists, patient
records, manuals, personnel,
employment and payroll files, promotional
materials, business forms, permits,
licenses, titles and other written, printed
or electronic information of any
kind used by Seller or its employees and
contractors/tenant doctors of optometry
to conduct the Business, including without
limitation all data and information
in the Seller's POS Delta System (access to
which shall be provided by Seller to
Buyer for electronic transfer at Buyer's
expense) and any and all other records
and information (the "Books and
Records").
1.2 "As Is" Transaction. Buyer hereby acknowledges and agrees
that,
except as otherwise expressly provided in
this Agreement, Seller makes no
representations or warranties of any kind
whatsoever, express or implied, with
respect to any matter relating to the
Assets or otherwise relating to any of the
transactions contemplated hereby including,
without limitation, any income to be
derived or expenses to be incurred in
connection with the Assets or the conduct
of the Business, the physical condition of
any tangible Assets or improvements
which are the subject of any Store Leases
to be assumed by Buyer at the Closing,
the value of the Assets, the terms or
amounts of any Assumed Liabilities, or the
merchantability or fitness of the Assets
for any particular purpose.
Accordingly, subject to the
representations, warranties and covenants expressly
set forth in this Agreement Buyer shall
accept the Assets at the Closing "AS
IS," "WHERE IS" AND "WITH ALL FAULTS."
2.
EXCLUDED ASSETS. Buyer shall not purchase or otherwise acquire
from
Seller, and Seller shall
retain all of its rights, titles and interests in
and to: (a) all cash, cash
equivalents, bank accounts and securities of
Seller; (b) all accounts
receivable of Seller, except that Buyer shall be
entitled to receive payment
for all services rendered by it after closing for
completion of work in
process commenced by Seller and not completed at the
time of closing provided
Buyer's services are necessary to complete
performance of an oral or
written contract assumed by it in accordance with
Section 3 below;. (c) all
causes of action and claims
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which Seller may have under
Sections 506, 510, 542 through 551 inclusive and
553 of the Bankruptcy Code;
and (d) all assets not specifically enumerated in
Section 1 above.
3.
RETENTION AND ASSUMPTION OF LIABILITIES.
3.1 Liabilities Retained by Seller. Subject to Section 3.2
below,
and except as otherwise expressly provided
in this Agreement, Seller shall
remain solely and entirely responsible for
its own liabilities and Buyer shall
not assume or otherwise be liable for or
acquire the Assets subject to, and
Buyer's purchase of the Assets shall not
constitute or be deemed to constitute
the assumption of, any liabilities of
Seller whatsoever, whether direct or
indirect, fixed or contingent, disputed or
undisputed, liquidated or
unliquidated, known or unknown, recorded or
unrecorded.
3.2 Liabilities Assumed by Buyer. Buyer shall pay and otherwise
perform when due the obligations of Seller:
(a) under the Store Leases and the
Assumed Contracts relating to periods after
the Closing Date (as defined in
Section 6 below); and (b) to Seller's
current employees only for accrued but
unused PTO (paid time-off) including,
without limitation, accrued but unused
sick leave, family leave and vacation time
for those employees that Buyer, in
the exercise of its sole judgment, elects
to employ as provided in Section 3.3
below (collectively the "Assumed
Liabilities").
3.3 Seller's Employees. Buyer shall have the right, but not the
obligation, to employ any present employee
of Seller. Buyer shall have no
responsibility or liability as a result of
Buyer's acquisition of the Assets, or
its employment of any such employees, with
respect to contributions to or
obligations for any of Seller's employee
benefit plans, any multi-employer
pension plan to which Seller may contribute
or, except as provided in Section
3.2 above, any other liability or employee
fringe benefit of Seller which is due
or unsatisfied as of the Closing.
4.
PURCHASE PRICE.
4.1 Amount. The purchase price for the Assets shall be: (a)
537,000,
which shall be allocated as follows:
<TABLE>
<S>
<C>
Inventory
$ 269,000
FFE
$
56,000
Store Leases and Assumed Contracts
$
60,000
Intellectual Property and
Books and Records
$ 122,811
Goodwill/Name
$
29,189
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$ 537,000
</TABLE>
plus (b) the Assumed Liabilities.
4.2 Reporting. The purchase price for the Assets shall be
allocated
for federal income tax purposes in
accordance with Section 4.1 above and IRS
Form 8594 required to be filed under
Section 1060 of the Internal Revenue Code
of 1986, as amended (the "Code"), in
connection with the purchase and sale of
the Assets shall reflect such allocations.
Seller and
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Buyer shall file all tax and other returns
in a manner consistent with such
allocations and shall take no position
contrary thereto.
4.3 Prorations. All payments from doctors in accordance with
the
Doctor Agreements, all lease and rental
charges (including, without limitation,
rent and other amounts payable by Seller
under the Store Leases), and all
monthly utility charges shall be prorated
between Seller and Buyer as of the
Closing Date, with Seller being responsible
for, and entitled to the benefit of,
all such charges and payments relating to
periods prior to the Closing Date and
Buyer being responsible for, and entitled
to the benefit of, all such charges
and payments, on and after the Closing
Date. Should either Seller or Buyer pay
any such charges for which the other party
is responsible, then the responsible
party shall promptly reimburse the other
party therefor. Should either Seller or
Buyer receive any revenues to which the
other party is entitled, then such
revenues shall promptly be paid over to the
appropriate party.
4.4 Transfer Taxes. Buyer shall pay all federal, state and
local
sales, use, transfer, documentary stamp,
conveyance, recording, conveyance and
similar taxes arising out of, in connection
with or related to the transactions
contemplated by this Agreement.
5. NON
COMPETITION AGREEMENT. Seller and SRC shall enter into a non
competition agreement
prohibiting the ownership, operation, or participation
in any manner by Seller, SRC
and any affiliate of them in any retail eye
glass store in competition
with Buyer in Lake, Porter and LaPorte Counties in
the State of Indiana for a
three (3) year period commencing on the Effective
Time (the "Non Competition
Agreement"). "Affiliate" as used in this Section
5, means any person or
entity who controls, is controlled by, or is under
common control with Seller
or SRC, either directly or indirectly through
intermediaries.
6.
CLOSING. The closing of the transactions contemplated by this
Agreement
(the "Closing") shall take
place on or before January 28, 2005 or at such
other date and time to which
the parties may agree (the "Closing Date"). At
the Closing:
6.1 Buyer's Payments and Deliveries. Buyer shall deliver to
Seller:
(a) the sum of $537,000, plus or minus any adjustments
provided for in this Agreement, in
immediately available funds by wire transfer
to a bank account designated by Seller;
(b) one or more agreements effecting the assignment to Buyer
of the Store Leases and Assumed
Contracts;
(c)
a certified copy of the consent of the board of directors
of Buyer authorizing and directing Buyer to
enter into and perform its
obligations under this Agreement; and
(d) such other documents, instruments and deliveries as Seller
reasonably may request.
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6.2 Seller's Deliveries. Seller shall deliver to Buyer:
(a) a bill of sale conveying all of the Assets to Buyer;
(b) one or more agreements effecting Buyer's assumption of the
Assumed Liabilities;
(c) a certified copy of the consent of the board of directors
of Seller authorizing and directing Seller
to enter into and perform its
obligations under this Agreement;
(d) the Non Competition Agreement executed by Seller and SRC;
and
(e) such other documents, instruments and deliveries as Buyer
reasonably may request.
The purchase and sale of the Assets shall
be effective at 6:00 p.m. local time
on the Closing Date (the "Effective Time").
Buyer shall be given possession of
the Assets at the Effective Time. Until the
Effective Time, all employees of
Seller shall continue to be its employees,
and all business operations of Seller
shall be for Seller's account and risk and
Seller shall bear all risk of loss.
7.
REPRESENTATIONS AND WARRANTIES OF SELLER. If and only to the
extent
that under applicable
federal, state or local law the breach of any of the
following representations or
warranties would result in, or fail to disclose,
a lien upon or claim against
the Assets, or result in a claim against Buyer
for a liability of Seller
(other than the Assumed Liabilities), and subject
to its obligations as a
debtor-in-possession under the Bankruptcy Code,
Seller hereby represents and
warrants to and covenants with Buyer that:
7.1 Organization. Seller is a corporation duly organized,
validly
existing and in good standing under the
laws of the State of Indiana and is the
sole owner of the Assets. Subject to its
obligations as a debtor-in-possession
under the Bankruptcy Code, Seller has full
authority and power to carry on the
Business as it is now conducted.
7.2 Authority and Enforceability.
(a) Seller has and at the Closing will have all requisite
power, right and authority to enter into
this Agreement and to consummate the
transactions contemplated by this
Agreement. All action required under
applicable law has been or will be taken by
the board of directors of Seller to
authorize Seller's execution of, and the
consummation of the transactions
contemplated by, this Agreement. This
Agreement and each other agreement and
instrument to be executed by Seller in
connection herewith have been (or upon
execution will have been) duly executed and
delivered by Seller and constitute
(or upon execution will constitute) legal,
valid and binding obligations of
Seller enforceable against Seller in
accordance with their respective terms.
(b) All consents, approvals and authorizations and all other
requirements prescribed by any law, rule or
regulation which must be obtained or
satisfied by Seller and which are necessary
for the execution and delivery by
Seller of this Agreement and the documents
to be executed and delivered by
Seller in connection herewith and in order
to
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permit the consummation of the transactions
contemplated by this Agreement have
been obtained and satisfied or will be
obtained and satisfied by the Closing.
7.3 No Violation or Conflict. The execution and delivery of
this
Agreement, the consummation of the
transactions contemplated hereby and the
fulfillment of the terms hereof will not
violate or result in a breach of any of
the terms or provisions of, or constitute a
default (or an event which, with
notice or the passage of time, or both,
would constitute a default) under, or
conflict with or result in the termination
of, or accelerate the performance
required by any: (a) agreement, indenture,
contract or other instrument to which
Seller is a party or by which Seller or the
Assets are bound except the loan
agreements between Seller and CadleRock
Joint Venture, L.P.; (b) Seller's
Articles of Incorporation; (c) any
judgment, decree, order or award of any
court, governmental body or arbitrator by
which Seller or the Assets are bound;
or (d) any law, rule or regulation
applicable to Seller or the Assets.
7.4 Title to Assets. Seller has good title to, is the sole
lawful
owner of, and has the right to use all of
the Assets and at the Closing will
transfer the Assets to Buyer free and c
