Securities Purchase Agreement to acquire 100% of the common stock of MGL Solutions, Inc., a Delaware corporation, dated April 14, 2011, effective March 1, 2011

SECURITIES PURCHASE AGREEMENT by and between

 

MGL AMERICAS INC.

 

and

 

ZOLON CORPORATION

 

 

Dated as of April 14th, 2011 SECURITIES PURCHASE AGREEMENT

 

 

 

 

 

This SECURITIES PURCHASE AGREEMENT (this “Agreement”) is made as of April 14th, 2011, by and between MGL Americas Inc., a Delaware corporation (the “Seller”), and Zolon Corporation, a Florida corporation (“Buyer”) and made in light of the following recitals which are a material part hereof and this Agreement shall be construed so as to give maximum effect thereto.

 

A.

WHEREAS, Seller owns all of the outstanding common stock (the “Securities”) of MGL Solutions, Inc., a Delaware corporation (the “Company”);

 

B.

WHEREAS, subject to the terms and conditions set forth herein, Buyer desires to acquire from Seller, and Seller desires to sell to Buyer all of the Securities; and

 

C.

WHEREAS, the respective boards of directors or other governing bodies, as applicable, of Buyer and Seller have approved this Agreement and the transactions contemplated hereby, upon the terms and subject to the conditions set forth herein.

 

NOW, THEREFORE, in consideration of the premises, representations and warranties and mutual covenants contained herein and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged and intending to be legally bound, the parties hereto agree as follows:

 

ARTICLE I

 

 

1.01Purchase and Sale of Securities. Upon the terms and subject to the conditions set forth in this Agreement, at the Closing, Seller shall sell, assign, transfer and convey to Buyer, and Buyer shall purchase and acquire from Seller, all of the Securities in exchange for the assumption by the Buyer of the Assumed Liabilities (the “Purchase Price”).

 

1.02 Upon the terms and subject to the conditions of this Agreement, Buyer shall assume effective as of the Closing, and from and after the Closing Buyer shall pay, discharge or perform when due, as appropriate, the following Liabilities of the Seller (the “Assumed Liabilities”), and no other Liabilities:

 

(a) a note for the amount of $3,000,000 (three Million Dollars) carrying a simple annual interest of 12% maturing on December 31, 2011 payable to Laurus Funds

 

(b) a note for the amount of $5,000,000 (Five Million Dollars) carrying a simple annual interest of 5% maturing on June 30, 2014

 

(c) issuance of 4 million shares of the common stock of the buyer

 

(d) contingent earn-out of up to $5,000,000, payable over three years, if earned, as defined elsewhere

 

(e) all Liabilities due with respect to certain accounts payable necessary to operate the business of the Company as listed on Schedule 1.02(b); and all accrued and unpaid Liabilities owing to employees of Seller and/or the Company who are necessary to operate the business of the Company as listed on Schedule 1.02(c) limited to a maximum of $2,000,000 (Two million Dollars)

1.03 The Closing. The closing of the transactions contemplated by this Agreement (the “Closing”) shall take place at the offices of Buyer, located at 2850 Golf Road, Rolling Meadows, Il 60010 on April 14th, 2011, or if any of the conditions to the Closing set forth in Article II below (other than those to be satisfied at the Closing) have not been satisfied or waived by the party entitled to the benefit thereof prior to such date, then on or prior to the second business day following satisfaction such condition, or on such other date as is mutually agreeable to Buyer and Seller. The date of the Closing is herein referred to as the “Closing Date.” The Closing shall be deemed to occur at 12:01 a.m. on the Closing Date. The Closing may be accomplished by delivery of signed documents or counterparts without physical presence of the parties.

 

 

 

 

2.01 Conditions to All Parties’ Obligations. The obligations of Seller and Buyer to consummate the transactions contemplated by this Agreement are subject to the satisfaction of the following conditions as of the Closing Date:

 

(a) The applicable waiting periods, if any, under the HSR Act shall have expired or been terminated;

 

(b) Except for any pending action or proceeding directly or indirectly initiated by the party asserting its right to not consummate the transactions contemplated by this Agreement pursuant to this Section 2.01(b), no action or proceeding before any court or government body shall be pending wherein an unfavorable judgment, decree or order would prevent the performance of this Agreement or the consummation of any of the transactions contemplated hereby, declare unlawful the transactions contemplated by this Agreement or cause such transactions to be rescinded;

 

(c) All documentation required by the Lenders relating to the bifurcation of indebtedness owing by the Seller and the Company to the Lenders shall have been duly authorized, executed and delivered; such that after giving effect to such bifurcation, the Company’s Liabilities to the Lenders shall be limited to the Lenders Debt; and

 

 

ARTICLE III

 

 

Seller represents and warrants to Buyer as follows:

 

3.01 Authority. Seller has all requisite power and authority and full legal capacity to execute and deliver this Agreement and to perform its obligations hereunder.

 

3.02 Organization and Power. Seller is duly organized, validly existing and in good standing under the laws of the State of Delaware.

 

3.03 Execution and Delivery; Valid and Binding Agreement. The execution, delivery and performance of this Agreement by Seller and the consummation of the transactions contemplated hereby have been duly and validly authorized by all requisite action on the part of Seller, and no other proceedings on Seller’s part are necessary to authorize the execution, delivery or performance of this Agreement. Assuming that this Agreement is a valid and binding obligation of Buyer, this Agreement constitutes a valid and binding obligation of Seller, enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization, or moratorium laws, other similar laws affecting creditors’ rights and general principles of equity affecting the availability of specific performance and other equitable remedies.

 

3.04 No Breach. The execution and delivery of this Agreement by Seller does not, and the performance of this Agreement and the consummation of the transactions contemplated hereby by Seller will not, (a) conflict with or violate the constituting documents of Seller, (b) conflict with or violate any legal requirement applicable to Seller or by which any of its assets are bound or affected, or (c) conflict with or violate the terms of any agreement of Seller.

 

3.05 Consents, etc. Except as set forth on Schedule 3.05 hereto, no consent, approval, permit or license from or filing with any Governmental Body nor any other party or Person, is required to be obtained or made by Seller in connection with the execution, delivery and performance by it of this Agreement or the consummation of any of the transactions contemplated hereby. In the event that Seller determines that it qualifies as a “person” with a value for purposes of the HSR Act, in excess of $131,900,000, Seller shall present, within Schedule 3.05, proof of its notice to the US Department of Justice and the US Federal Trade Commission as required under the HSR (Buyer having represented that it is a “person” with a value above $13,200,000 but not above $131,900,000 for purposes of the HSR Act) or in the alternative, proof in the form of an opinion of counsel, that either Seller does not meet the foregoing “size of the person test” or the transaction contemplated herein does not meet the “size of the transaction” test obviating the need for such notice.

 

 

 

 

3.12 Employees and Vendors. Schedule 3.12 sets forth a complete and accurate list of all of the full time and part time employees and vendors of the Company and, as attached to such Schedule 3.12, complete and accurate copies of all salary, stock option, bonus, incentive compensation, deferred compensation, profit sharing, retirement, pension, group insurance, disability, death benefit or other benefit plans, trust agreements or arrangements of the Company in effect on Closing Date or to become effective after the Closing Date, together with copies of any determination letters issued by the IRS with respect thereto. Except as separately disclosed, neither Seller nor the Company shall have caused to occur nor contemplates causing to be effective, a “plant closing” or “mass layoff” as each is described in the Worker Adjustment and Retraining Notification Act (or any similar state law having jurisdiction over the Seller or Company or otherwise being applicable) prior to the Closing.

 

3.13 Leases and Contracts. Schedule 3.13 sets forth a complete and accurate list of all material leases (whether of real or personal property) and each contract, promissory note, mortgage, license, franchise or other written agreement or any obligation of the Company to indemnify any other individual or entity, to which the Company is a party, which involves, or can reasonably be expected to involve, aggregate future payments or receipts by the Company (whether by the terms of such lease, contract, promissory note, license, franchise or other written agreement or as a result of a guarantee of the payment of or indemnity against the failure to pay same) of $1,000.00 or more annually during the twelve-month period ended December 31, 2011 or any consecutive twelve-month period thereafter, except any of said instruments which terminate or are cancelable without penalty during such twelve-month period and which lists accurately describe the contracts, agreements, plans, promissory notes, mortgages, leases, policies, licenses, franchises or similar instruments to which the Company is a party, all of which are, unless otherwise disclosed, valid and in full force and effect as of the Closing Date with no requirements for consent or approval unless described therein.

 

3.14 Loans and Obligations. Schedule 3.14 sets forth a complete and accurate list of all loans, notes and each contract or other written agreement to which the Company is a party with respect to repayment of borrowed money or any similar obligations of the Company, which requires, or can reasonably be expected to require, aggregate future payments by the Company under the terms thereof or as a result of a guarantee of payment or performance or indemnity against the failure to pay same of $1,000.00 or more annually during the twelve-month period ended December 31, 2011 or any consecutive twelve-month period thereafter.

 

3.15 Corporate Organization Documents. Attached to Schedule 3.15 are complete and accurate copies of all corporate organizational documents including but not limited to Articles of Incorporation and Bylaws of the Company and articles or certificates of authority for each jurisdiction in which the Company is formed, authorized to do business or otherwise governed, together with all amendments thereto and all corporate governance documents interpreting, modifying or implementing any authority or right thereunder, all documents pertaining to the sale, offer, registration, designation or authority for shares of any securities offered or sold by the Company including common and preferred stock and convertible debt instruments and a complete and accurate list of all persons or entities holding either capital stock or any rights to subscribe for, acquire or receive shares of the capital stock of the Company (whether warrants, calls, options or conversion rights), including copies of all stock option plans, whether qualified or nonqualified and a complete and accurate list of all officers and directors and advisors for the Company.

 

3.16 Customers. Schedule 3.16 sets forth a complete and accurate list (in all material respects) of the customers of the Company, including all presently effective contracts accounting for the principle revenues of the Company (and its predessessors), indicating the dollar amounts of gross revenues of each such customer for the twelve-month period ended as of March 31, 2011, the relationship with each of which customers being the exclusive customer and relationship of the Company. Neither Seller nor its affiliates shall solicit or contract or otherwise enter into competitive relationships with any of the Customers set forth on Schedule 3.16 for a period of seven (7) years following the Closing and this covenant shall alone survive the Closing for that period.

 

 

 

ARTICLE IV

 

 

 

 

4.03 No Breach. Buyer is not subject to or obligated, to the extent applicable, under its articles of incorporation, its bylaws or applicable governing documents, any applicable law, or rule or regulation of any governmental authority, or any material agreement or instrument, or any license, franchise or permit, or any order, writ, injunction or decree, which would be breached or violated in any material respect by its execution, delivery or performance of this Agreement.

 

4.04 Consents, etc.. Except for the applicable requirements of the HSR Act, if applicable, Buyer is not required to submit any notice, report or other filing with any governmental authority in connection with the execution, delivery or performance by it of this Agreement or the consummation of the transactions contemplated hereby. Buyer has made or caused to be made all filings and submissions under the HSR Act necessary for the consummation of the transactions contemplated herein. No consent, approval or authorization of any governmental or regulatory authority or any other party or Person is required to be obtained by Buyer in connection with its execution, delivery and performance of this Agreement or the consummation of the transactions contemplated hereby. For purposes of the HSR Act, Buyer represents that that it is a “person” with a value above $13,200,000 but not above $131,900,000 but any requirement for such notice shall be as determined by Seller.

 

4.05 Litigation. There are no actions or proceedings pending or, to Buyer’s knowledge, overtly threatened against or affecting Buyer at law or in equity, or before or by any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, which would adversely affect Buyer’s performance under this Agreement or the consummation of the transactions contemplated hereby. Buyer is not subject to any outstanding judgment, order or decree of any court or Governmental Body.

 

4.06 Brokerage. There are no claims for brokerage commissions, finders’ fees or similar compensation in connection with the transactions contemplated by this Agreement based on any arrangement or agreement made by or on behalf of Buyer.

 

4.07 Solvency. Upon consummation of the transaction contemplated hereby, Buyer and the Company will not (a) be insolvent or left with unreasonably small capital, (b) have incurred debts beyond their ability to pay such debts as they mature, or (c) have liabilities in excess of the reasonable market value of their assets.

 

4.08 Investment Representation. Buyer is acquiring the Securities for its own account with the present intention of holding such securities for investment purposes and not with a view to, or for sale in connection with, any distribution of such securities in violation of any federal or state securities laws. Buyer is an “accredited investor” as defined in Regulation D promulgated by the Securities and Exchange Commission under the Securities Act. Buyer acknowledges that it is informed as to the risks of the transactions contemplated hereby and of ownership of the Securities. Buyer acknowledges that the Securities have not been registered under the Securities Act, or any state or foreign securities laws and that the Securities may not be sold, transferred, offered for sale, assigned, pledged, hypothecated or otherwise disposed of unless such transfer, sale, assignment, pledge, hypothecation or other disposition is pursuant to the terms of an effective registration statement under the Securities Act and the Securities are registered under any applicable state or foreign securities laws or sold pursuant to an exemption from registration under the Securities Act and any applicable state or foreign securities laws.

 

4.09 Financing. Buyer has, on the date hereof, the financial capability and all sufficient cash on hand necessary to consummate the transactions contemplated by this Agreement on the terms and subject to the conditions set forth herein, and will have all such capability as of the Closing.

 

4.10 Investigation. Buyer acknowledges that it is relying on its own independent investigation and analysis in entering into the transactions contemplated hereby. Buyer is knowledgeable about the industries in which the Company operates and is capable of evaluating the merits and risks of the transactions contemplated by this Agreement and is able to bear the substantial economic risk of such investment for an indefinite period of time. Buyer has been afforded full access to the books and records, facilities and personnel of the Company for purposes of conducting a due diligence investigation and has conducted a full due diligence investigation of the Company. Buyer does not have any knowledge that the representations and warranties of any Seller or the Company in this Agreement are not true and correct in all material respects, and Buyer does not have any knowledge of any material errors in, or material omissions from, the attached disclosures schedules.

 

 

ARTICLE V

 

 

5.01 Conduct of the Business. From the date hereof until the Closing Date, Seller shall use its commercially reasonable efforts to cause the Company to carry on its (and its Subsidiaries’if any) businesses according to its ordinary course of business and substantially in the same manner as heretofore conducted; provided that, the foregoing notwithstanding, the Company may use all available cash to repay any expenses incurred by it in connection with this Agreement or the transactions contemplated hereby prior to the Closing but the Company may not pay dividends or distributions to its stockholders of any amount, in cash or in kind.

 

5.02 Access to Books and Records. From the date hereof until the Closing Date, Seller shall use its commercially reasonable efforts to cause the Company to provide Buyer and its authorized representatives (“Buyer’s Representatives”) with access deemed reasonable by the Company during normal business hours and upon reasonable notice to the offices, properties, books and records of the Company and its Subsidiaries to the extent relating to the transition of the Company’s business to Buyer; provided that such access does not unreasonably interfere with the normal operations of the Company; provided further that all requests for such access shall be directed to Sivakumar Srinivasan or such other Person as Seller may designate in writing from time to time. Notwithstanding anything to the contrary in this Agreement, the Company shall not be required to disclose any information to Buyer if such disclosure would be reasonably likely to (a) jeopardize any attorney-client or other legal privilege or (b) contravene any applicable Laws, fiduciary duty or binding agreement entered into prior to the date hereof. Seller does not make any representation or warranty as to the accuracy of any information (if any) provided pursuant to this Section 5.02, and Buyer may not rely on the accuracy of any such information. The information provided pursuant to this Section 5.02 will be used solely for the purpose of effecting the transactions contemplated hereby, and will be governed by all the terms and conditions of the Confidentiality Agreement, dated March 20th, 2011 between Buyer and Seller (the “Confidentiality Agreement”).

 

5.03 Regulatory Filings. Seller shall cooperate with Buyer and the Company to make or cause to be made all filings and submissions under any material laws or regulations applicable to the Company or the Buyer for the consummation of the transactions contemplated herein. Seller shall use its commercially reasonable efforts to cause the Company shall coordinate and cooperate with Buyer in exchanging such information and providing such assistance as Buyer may reasonably request in connection with the foregoing. Consents for any such filings or notices shall not be unreasonably withheld or delayed.

 

5.04 Exclusive Dealing. During the period from the date of this Agreement through the Closing Date or the earlier termination of this Agreement pursuant to Section 7.01 hereof, Seller shall not take or permit any other Person on its behalf to take any action to encourage, initiate or engage in discussions or negotiations with, or provide any information to, any Person (other than Buyer and Buyer’s Representatives) concerning any purchase of the Securities, any merger involving the Company, any sale of substantially all of the assets of the Company, or other similar transaction involving the Company (other than assets sold in the ordinary course of business).

 

5.05 Notification. From the date hereof until the Closing Date, Seller shall disclose to Buyer in writing any development, fact or circumstance arising after the date hereof causing a breach of any of Seller’s representations and warranties contained in Article IV. Seller shall promptly notify Buyer if Seller obtains knowledge that the representations and warranties of Buyer in this Agreement and the disclosure schedules hereto are not true and correct in all material respects, or if Seller obtains knowledge of any breaches of any covenants, agreements or material errors in, or omissions from, the disclosure schedules to this Agreement.

 

 

ARTICLE VI

 

 

6.01 Regulatory Filings. Each of Buyer and Seller shall, within two business days after the date hereof, make or cause to be made all filings and submissions under any laws or regulations applicable to it and its Affiliates for the consummation of the transactions contemplated herein. Subject to applicable laws relating to the exchange of information, the other party shall have the right to review in advance, and to the extent practicable will consult with the filing party on all the information that appears in any such filings and shall act reasonably and as promptly as practicable. Each of Seller and Buyer shall pay all fees associated with all filings and submissions required of it.

 

6.02 Employment and Benefit Arrangements. For a period of one year following the Closing Date, Buyer shall cause the Company and its Subsidiaries to continue all employment, severance, termination, consulting, retirement and other compensation and benefit plans, arrangements and agreements to which the Company is a party as of the date hereof, or make available alternative benefits, plans, arrangements and agreements that are substantially comparable, in the aggregate, to such plans, arrangements and agreements. Buyer shall take all actions required so that eligible employees of the Company shall receive service credit for all purposes under any successor employee benefit plans and arrangements sponsored by Buyer. To the extent that Buyer modifies any coverage or benefit plans under which the employees of the Company participate, Buyer shall waive any applicable waiting periods, pre­existing conditions or actively-at-work requirements and shall give such employees credit under the new coverages or benefit plans for deductibles, co-payments and out-of-pocket payments that have been paid during the year in which such coverage or plan modification occurs. This Section 6.02 shall survive the consummation of the transactions contemplated by this Agreement and shall be binding on all successors and assigns.

 

6.03 Employee Matters. Buyer will indemnify the Seller and its Affiliates from and against any losses that may be incurred by them under the Worker Adjustment and Retraining Notification Act or under any state, local or foreign law of a similar nature with respect to any office closing, layoff or relocation occurring after the Closing as a result of any action taken by the Company following the Closing or with respect to any obligation to provide notice, payment or any other benefit as a result of or arising out of any termination of employment of any employee of the Company following the Closing.

 

ARTICLE VII

 

 

 

 

 

ARTICLE VIII

 

 

 

8.03 Further Assurances. From time to time, as and when requested by any party hereto and at such requesting party’s expense, any other party shall execute and deliver, or cause to be executed and delivered, all such documents and instruments and shall take, or cause to be taken, all such further or other actions as the requesting party may reasonably deem necessary or desirable to evidence and effectuate the transactions contemplated by this Agreement.

 

ARTICLE IX

 

 

 

 

 

 

 

“Pre-Closing Tax Period” means any taxable period ending on or before the Closing Date and the portion of any Straddle Period up to and including the Closing Date.

 

“PSDL” means PSource Structured Debt Limited, a Guernsey company, together with its successors and assigns.

 

“Securities Act” means the Securities Act of 1933, as amended.

 

“Solutions Security Agreement” means that certain Security Agreement, dated as of the date hereof, by and among the Company, the Agent, Valens US, Valens Offshore and PSDL, as may be amended, modified or supplemented from time to time.

 

“Stock Pledge Agreement” means that certain Stock Pledge Agreement, dated as of the date hereof by and between Buyer and Agent, for the ratable benefit of the Lenders, in the form attached hereto as Exhibit C.

 

“Straddle Period” means any taxable period beginning on or prior to and ending after the Closing Date.

 

“Subsidiary” means, with respect to any Person, any corporation, partnership, association or other business entity of which (a) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (g) if a partnership, association or other business entity, a majority of the partnership or other similar ownership interests thereof is at the time owned or controlled, directly or indirectly, by any Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership interest in a partnership, association or other business entity if such Person or Persons shall be allocated a majority of partnership, association or other business entity gains or losses or shall be or control the managing director, managing member, general partner or other managing Person of such partnership, association or other business entity. Unless the context requires otherwise, each reference to a Subsidiary shall be deemed to be a reference to a Subsidiary of the Company.

 

“Tax” or “Taxes” means any federal, state, local or foreign income, gross receipts, capital stock, franchise, profits, withholding, social security, unemployment, disability, real property, ad valorem/personal property, stamp, excise, occupation, sales, use, transfer, value added, alternative minimum, estimated or other tax, including any interest, penalty or addition thereto.

 

“Tax Returns” means any return, report, information return or other document (including schedules or any related or supporting information) filed or required to be filed with any governmental entity or other authority in connection with the determination, assessment or collection of any Tax or the administration of any laws, regulations or administrative requirements relating to any Tax.

 

“Transaction Tax Deductions” means any item of loss, deduction, or credit resulting from or attributable to costs and expenses of the Company and/or any of its Subsidiaries related to or arising out of the transactions contemplated by this Agreement, including, but not limited to, any loss, deduction or credit resulting from any employee bonuses, debt prepayment fees or capitalized debt costs.

 

“Valens Offshore” means Valens Offshore SPV I, Ltd., a Cayman Islands company, together with its successors and assigns.

 

 

ARTICLE X

 

 

 

 

10.03 Prevailing Party. In the event of a dispute between any of the parties hereto with respect to obligations under this Agreement, the prevailing party in any action or proceeding in any court or arbitration in connection therewith shall be entitled to recover from such other party its costs and expenses, including, without limitation, reasonable legal fees and associated court costs.

 

10.04 Notices. All notices, demands and other communications to be given or delivered under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to have been given (a) when personally delivered, (b) when transmitted via telecopy (or other facsimile device) to the number set out below if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service (charges prepaid), (c) the day following the day (except if not a business day then the next business day) on which the same has been delivered prepaid to a reputable national overnight air courier service, (d) when transmitted via email (including via attached PDF or other static image document) to the email address set out below if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service (charges prepaid), or (e) the third business day following the day on which the same is sent by certified or registered mail, postage prepaid. Notices, demands and communications, in each case to the respective parties, shall be sent to the applicable address set forth on the signature pages hereto, unless another address has been previously specified in writing.

 

10.05 Assignment. This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns, except that neither this Agreement nor any of the rights, interests or obligations hereunder may be assigned or delegated by any party hereto without the prior written consent of the other parties hereto. Notwithstanding the foregoing, (a) Buyer may assign this Agreement to any Subsidiary of Buyer or to any lender to Buyer or any Subsidiary or Affiliate thereof as security for obligations to such lender in respect of the financing arrangements entered into in connection with the transactions contemplated hereby and any refinancings, extensions, refundings or renewals thereof, provided that no assignment to any such Subsidiary or lender shall in any way affect Buyer’s obligations or liabilities under this Agreement, and (b) after the Closing, each Seller may assign this Agreement to any of its beneficial owners or successors by operation of law.

 

10.06 Severability. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement, and the parties shall amend or otherwise modify this Agreement to replace any prohibited or invalid provision with an effective and valid provision that gives effect to the intent of the parties to the maximum extent permitted by applicable law.

 

10.07 No Strict Construction. The language used in this Agreement shall be deemed to be the language chosen by the parties hereto to express their mutual intent, and no rule of strict construction shall be applied against any Person. The disclosure schedules attached to this Agreement have been arranged for purposes of convenience in separately titled sections corresponding to sections of this Agreement; provided however, each section of the disclosure schedules shall be deemed to incorporate by reference all information disclosed in any other section of the disclosure schedules. Capitalized terms used in the disclosure schedules and not otherwise defined therein have the meanings given to them in this Agreement. In the event a subject matter is addressed in more than one representation and warranty, Buyer shall be entitled to rely only on the most specific representation and warranty addressing such matter. The specification of any dollar amount or the inclusion of any item in the representations and warranties contained in this Agreement or the disclosure schedules or Exhibits attached hereto is not intended to imply that the amounts, or higher or lower amounts, or the items so included, or other items, are or are not required to be disclosed (including, without limitation, whether such amounts or items are required to be disclosed as material or threatened) or are within or outside of the ordinary course of business, and no party shall use the fact of the setting of the amounts or the fact of the inclusion of any item in this Agreement or the disclosure schedules or Exhibits in any dispute or controversy between the parties as to whether any obligation, item or matter not described or included in this Agreement or in any disclosure schedule or Exhibit is or is not required to be disclosed (including whether the amount or items are required to be disclosed as material or threatened) or is within or outside of the ordinary course of business for purposes of this Agreement. The information contained in this Agreement and in the disclosure schedules and Exhibits hereto is disclosed solely for purposes of this Agreement, and no information contained herein or therein shall be deemed to be an admission by any party hereto to any third party of any matter whatsoever (including, without limitation, any violation of law or breach of contract).

 

 

10.08 Amendment and Waiver. Any provision of this Agreement or the disclosure schedules or Exhibits hereto may be amended or waived only in a writing signed by Buyer and Seller. No waiver of any provision hereunder or any breach or default thereof shall extend to or affect in any way any other provision or prior or subsequent breach or default.

 

10.09 Complete Agreement. This Agreement and the documents referred to herein (including the Confidentiality Agreement) contain the complete agreement between the parties hereto and supersede any prior understandings, agreements or representations by or between the parties, written or oral, which may have related to the subject matter hereof in any way.

 

10.10 Counterparts. This Agreement may be executed in multiple counterparts (including by means of telecopied signature pages or electronic transmission in portable document formant (PDF)), any one of which need not contain the signatures of more than one party, but all such counterparts taken together shall constitute one and the same instrument.

 

10.11 Governing Law. All matters relating to the interpretation, construction, validity and enforcement of this Agreement shall be governed by and construed in accordance with the domestic laws of the State of Illinois without giving effect to any choice or conflict of law provision or rule (whether of the State of Illinois or any other jurisdiction) that would cause the application of laws of any jurisdiction other than the State of Illinois.

 

10.12 CONSENT TO JURISDICTION AND SERVICE OF PROCESS. SUBJECT TO

SECTION 10.14 (WHICH SHALL GOVERN ANY DISPUTE NOT SEEKING INJUNCTIVE RELIEF), THE PARTIES TO THIS AGREEMENT SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE STATE COURTS LOCATED IN CHICAGO, ILLINOIS OR THE COURTS OF THE UNITED STATES LOCATED IN CHICAGO, ILLINOIS IN RESPECT OF THE INTERPRETATION AND ENFORCEMENT OF THE PROVISIONS OF THIS AGREEMENT AND ANY RELATED AGREEMENT, CERTIFICATE OR OTHER DOCUMENT DELIVERED IN CONNECTION HEREWITH AND BY THIS AGREEMENT WAIVE, AND AGREE NOT TO ASSERT, ANY DEFENSE IN ANY ACTION FOR THE INTERPRETATION OR ENFORCEMENT OF THIS AGREEMENT AND ANY RELATED AGREEMENT, CERTIFICATE OR OTHER DOCUMENT DELIVERED IN CONNECTION HEREWITH, THAT THEY ARE NOT SUBJECT THERETO OR THAT SUCH ACTION MAY NOT BE BROUGHT OR IS NOT MAINTAINABLE IN SUCH COURTS OR THAT THIS AGREEMENT MAY NOT BE ENFORCED IN OR BY SUCH COURTS OR THAT THEIR PROPERTY IS EXEMPT OR IMMUNE FROM EXECUTION, THAT THE ACTION IS BROUGHT IN AN INCONVENIENT FORUM, OR THAT THE VENUE OF THE ACTION IS IMPROPER. SERVICE OF PROCESS WITH RESPECT THERETO MAY BE MADE UPON BUYER BY MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH PARTY AT ITS ADDRESS AS PROVIDED IN SECTION10.04.

 

10.13 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (IV) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.13.

 

 

 

 

 

 

 

	SELLER:
	MGL AMERICAS INC.
	By:/s/ Sandy Chandra
	Sandy Chandra
	CEO
	Address:    1699 E. Woodfield Road, Suite 200
	Schaumburg, IL 60173
	BUYER:
	ZOLON CORPORATION
	By:/s/ Dhru Desai
	Dhru Desai
	CFO
	Zolon Corporation
	Address:    2850 Golf Road, Suite 30
	Rolling Meadows, IL 60008

 

 

[SIGNATURE PAGE TO STOCK PURCHASE AGREEMENT]

 

 

 

 

a. Employees Obligation (Project-wise)

 

b. Vendors Obligation (Project-wise)

 

 

a. Consent from LV Administrative Services Inc / Laurus Master Fund

 

b. Proof for shifting of employees' Payroll to MGL Solutions, Inc. with Paychex as the payroll processor.  Confirmation from paychex for processing the payroll for new company.

 

c. List of Vendors associated with the transfer of assets (clients)

 

 

 

None

 

 

 

 

 

 

 

 

 

 

None

 

 

 

 

 

 

 

 

 

 o Jarden, Compac industries, US circuits, Componix, Precision Southeast, CSL

 o Furnel. Diversified Plastics, General Films, Hillsman Modular, Ironwood Industries

 o Mega Circuits, Netco, Plastic Container Corporation, Star Die, Tritech

 

Liens:

 

 

 

None

 

 

 

 

 

 

 

 

 

 

 

 

 o Jarden, Compac industries, US circuits, Componix, Precision Southeast, CSL

 o Furnel. Diversified Plastics, General Films, Hillsman Modular, Ironwood Industries

 o Mega Circuits, Netco, Plastic Container Corporation, Star Die, Tritech

 

 

 

MGL Solutions will apply for license to do business in the State of Illinois.