ACQUISITION AGREEMENT









Execution

copy




 




EX-10.55




 




ACQUISITION AGREEMENT




 




AGREEMENT, dated as of December 31, 2001 by and among

FARBERWARE INC., a Delaware corporation (“Seller”), SYRATECH CORPORATION, a

Delaware corporation and the owner of all the issued and outstanding capital stock

of Seller (“Syratech”), and FARBERWARE LICENSING COMPANY, LLC, a  Delaware limited liability company

(“Buyer”).




 




WHEREAS, Buyer wishes to purchase and acquire, and

Seller is willing to sell, substantially all of the assets of Seller, including

without limitation all of Seller’s right, title and interest in and to Seller’s

Intellectual Property Rights and certain tools, dies and molds being sold on an

“as is, where is” basis;




 




NOW, THEREFORE, in consideration of the mutual

agreements and undertakings hereinafter contained, and of other good and

valuable consideration given by each of the Parties to the other, the receipt

and sufficiency of which are hereby acknowledged, the Parties hereby agree as

follows:




 




ARTICLE I.




 




Definitions-Interpretation

and Construction




 




The capitalized terms used in this Agreement are

defined, and the rules governing the interpretation and construction of this

Agreement are set forth, in Exhibit A annexed hereto; and the text and

provisions of said Exhibit A are incorporated herein by reference as though set

forth at length in this Article I.




 




 




 




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ARTICLE II.




 




Sale and Purchase of

Assets




 




2.1           Acquired

Assets.  Except as hereinafter set

forth, Seller hereby agrees to sell, assign and transfer to Buyer, and Buyer

hereby agrees to purchase from Seller, all of the business, assets, claims,

rights, and interests of Seller (the “Acquired Assets”), including without

limitation (i) all of Seller’s Intellectual Property Rights (and all goodwill

associated therewith) and the future proceeds and avails thereof; (ii) certain

tools, dies and molds (“Tools and Dies”) belonging to Seller’s business sold on

an “as is, where is” basis; (iii) all claims and rights of Seller under any and

all contracts, agreements, commitments, undertakings and other instruments

listed on Exhibit B (the “Contracts”); (iv) all payments made to, and all

accruals and receivables of, Seller or Syratech in respect of royalties or

advances against royalties arising under the Contracts and relating to periods

from and after the Effective Time; and (v) copies or originals of business,

marketing and financial records of Seller related to the Acquired Assets.




 




2.2           Certain

Assets Included.  Included within

the sale and purchase referred to in Section 2.1 are all of Seller’s right,

title and interest in and to (i) Seller’s Intellectual Property Rights and all

existing filings in respect thereof; (ii) all rights of Seller to reimbursement

for expenditures made by Buyer with respect to warranty claims after the

Effective Time pursuant to the 1996 Agreement; (iii) all continuing rights of

Seller under the Co-­Purchasers Agreement; (iv) all continuing rights of Seller

under Existing Farberware Licenses; (v) all payments due and owing to Seller

after the Effective Time as advances against royalties that will accrue under

Existing Farberware Licenses in respect of periods from and after the Effective

Time; and (vi) all royalties to the extent that such royalties both accrue and

are paid after the Effective Time under Contracts (including Existing

Farberware Licenses).




 




2.3           Excluded

Assets.  The Acquired Assets to be

sold and transferred to Buyer under this Agreement shall not include (and Buyer

shall not receive any interest in) Seller’s right, title and interest in and to

the following (the “Excluded Assets”): 

(i) that certain payment in the aggregate amount of $25,500,000 made to

Seller by Meyer on or about May 3, 1996 pursuant to Section 2.2 of the Meyer

Agreement; (ii) that certain payment in the amount of $2,575,000 made by Excel

on or about December 31, 1998 pursuant to Section 8 of the Excel Letter

Agreement; (iii) any payments of any kind received by Seller at any time prior

to the Effective Time relating to payments due and owing prior to the Effective

Time; (iv) any payments received by any Party 




 




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after the Effective Time in respect of royalties accrued through the

Effective Time under Existing Farberware Licenses; (v) any claims that Seller

or Syratech or any of their respective Affiliates may have for or in respect of

allowances or other chargebacks improperly asserted against, or deducted from

amounts due to, Seller, Syratech or any of their respective Affiliates based on

agreements allegedly made by Old Farberware or Seller; (vi) all claims for

reimbursement or otherwise that Seller may have against Old Farberware and/or

LHC and/or any service provider or customer or licensee for or in respect of

any action, claim or matter that occurred prior to the Effective Time; (vii)

all rights of Syratech and its Affiliates under Section 7.2 of the

Co-Purchasers Agreement; and (viii) all rights to Seller’s existing Farberware

inventory, or to the proceeds of sale therefrom.




 




2.4           No

Liens.  Seller shall sell and

transfer the Acquired Assets to Buyer free and clear of all liens or other

encumbrances (“Liens”) other than pursuant to the Contracts or Liens set forth

on Schedule 2.4 (“Permitted Liens”).




 




2.5           Failure

of Assignment of Contracts and Rights. 

In the case of any Acquired Asset which is not by its terms assignable

or transferable by Seller as a matter of right, Seller agrees to use its best

efforts to obtain all consents, approvals, waivers, claims or rights, or any

other benefit arising thereunder for the assignment thereof to Buyer as Buyer

may reasonably request.  Buyer and

Seller shall cooperate to obtain such consents, waivers, claims or rights, or

other benefits.  Until any such consent,

waiver, claim or right, or other benefit is obtained, or if an attempted

assignment or transfer thereof would be ineffective or would adversely affect

the rights of Seller or Syratech thereunder so that Buyer would not in fact

receive all such rights, Seller and Buyer will cooperate in a mutually

agreeable arrangement under which Buyer would obtain the benefits and assume

the obligations thereunder in accordance with this Agreement, including

subcontracting, sub-licensing, or subleasing to Buyer, or under which Seller

would enforce for the benefit of Buyer, with Buyer assuming Seller’s

obligations, any and all rights of Seller against a third party thereto.  Seller will promptly pay to Buyer when

received all moneys received by Seller under any asset or any claim or right or

any benefit arising thereunder, except to the extent the same represents an

Excluded Asset. Seller shall incur no liability whatsoever as a result of its

cooperation with Buyer herein.




 




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2.6           Further

Assurances.  At any time and from

time to time after the Closing, at Buyer’s request and without further

consideration, Seller shall, at Buyer’s cost and expense, if any, execute and

deliver such further instruments of sale, transfer, conveyance, assignment and

confirmation, and take such other action, as Buyer may reasonably request to

more effectively transfer, convey and assign to Buyer, and to confirm Buyer’s

title to, all of the Acquired Assets, to put Buyer in actual possession and

operating control thereof, to assist Buyer in exercising all rights with

respect thereto and to carry out the purpose and intent of this Agreement.  Without limiting the generality of the

foregoing, Buyer and Seller each acknowledge that certain trademarks, tradenames,

letters patent, copyrights, domain names, or applications therefor, or other

intellectual property, heretofore used in the Farberware Business and/or

assigned or purported to be assigned to Seller or Syratech pursuant to the 1996

Agreement were not or may not have been effectively assigned to Seller or

Syratech (the “Unassigned IP”); and Seller and Syratech hereby agree to take

such action, without further consideration and at Buyer’s cost and expense, as

Buyer may reasonably request from time to time to more effectively transfer,

convey and assign to Buyer such Unassigned IP.




 




2.7           Purchase

Price.  As consideration for the

sale and transfer to it of the Acquired

Assets at the Closing, Buyer shall pay the sum of Seven Million Four

Hundred Thousand Dollars ($7,400,000) (the “Purchase Price”) to Seller by wire

transfer in immediately available funds in accordance with wire transfer

instructions furnished to Buyer by Seller prior to the Closing Date.




 




ARTICLE III.




 




Liabilities and

Obligations




 




3.1           Assumption

of Liabilities. As of the Effective Time, Buyer shall assume, and be deemed

to have assumed, the following liabilities (the “Assumed Liabilities”):  (i) all liabilities and obligations of

Seller (including, without limitation, those for which Seller and Syratech may

be jointly and/or severally liable) under the Contracts, but only to the extent

that such liabilities and obligations arise out of actions or events occurring

after the Effective Time (and not as a 




 




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result of any action or inaction of Seller or Syratech before the

Effective Time); (ii) all product warranty obligations of Seller or Syratech to

consumers for repair or replacement of Farberware products sold with a

warranty, either designated as a “Lifetime Warranty,” “Limited Warranty,” or as

a “Warranty” generally;  (iii) all

obligations of Seller or Syratech arising under the Settlement Agreement, dated

February 3, 1997, by and among Old Farberware, U.S. Industries, Seller,

Syratech and LHC relating to the fulfillment of warranty obligations; (iv) all

obligations of Seller or Syratech arising under the Contracts, relating to the

fulfillment of warranty obligations; and (v) all obligations of Seller or

Syratech arising under all product liability claims related to the Farberware

Business (x) brought after the Effective Time and (y) arising out of actions or

events occurring prior to the Effective Time, provided, however, that for each

such claim Buyer shall be responsible only for that portion of the amount

payable (with respect to the final settlement of such claim) that is less than

the retention amount (self-insured portion) on Syratech’s applicable insurance

policy or policies under which coverage could be provided for such claim.  The Assumed Liabilities shall not include

Liabilities (as defined below) arising from an actual breach by Seller of (i)

any Contracts prior to the Effective Time, or (ii) any of Seller’s or

Syratech’s representations, warranties or covenants under this Agreement.  For purposes of this Agreement, the term “Liabilities”

shall mean any liability, claim, demand, expense, costs, debt, damage,

deficiency, commitment, obligation or responsibility, known or unknown, direct

or indirect, fixed or variable, liquidated or unliquidated, secured or

unsecured, accrued, absolute, contingent or otherwise.




 




3.2           Excluded

Liabilities.  Buyer will not assume

or have any responsibility with respect to any Liabilities of Seller or

Syratech not included within the definition of Assumed Liabilities (the

“Excluded Liabilities”).




 




ARTICLE IV.




 




Closing




 




4.1           The

Closing.  The transactions described

herein shall be consummated at a meeting (the “Closing”) to take place at the

offices of Sullivan & Worcester LLP, One Post Office Square, Boston,

Massachusetts 02109 as of the date hereof (the “Closing Date”).  The 




 




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transfer of the Acquired Assets by Seller to Buyer and the assumption

of Assumed Liabilities by Buyer shall be deemed effective as of the close of

business, Boston time, on the Closing Date (the “Effective Time”).  The transfer of the Acquired Assets shall be

effected by the execution and delivery by Seller of bills of sale and

instruments of assignment, and assumption of the Assumed Liabilities shall be

effected by the execution and delivery by Buyer of instruments of assumption.




 




ARTICLE V.




 




Representations of Seller




 




Seller represents to Buyer as follows:




 




5.1           Organization

and Good Standing.  Seller is a

corporation duly organized, validly existing and in good standing under the

laws of the State of Delaware with all requisite corporate power and authority

to own, lease and operate its assets and properties and to carry on its

business as presently conducted by it. 

To the best of Seller’s knowledge and belief, Seller is qualified as a

foreign corporation in each jurisdiction where the nature of its business or

location of its properties requires such qualification and where the failure to

qualify would have a material adverse effect on Seller.




 




5.2           Power,

Authorization and Validity. Seller has full corporate power and authority

to enter into this Agreement and the other agreements provided for herein to

which it is a party (the “Seller Ancillary Agreements”), and to consummate the

transactions contemplated hereby.  The

execution, delivery and performance by Seller of this Agreement and Seller

Ancillary Agreements have been duly and validly approved and authorized by the

board of directors and sole stockholder of Seller and no other actions or

proceedings on the part of Seller are necessary to authorize this Agreement and

the transactions contemplated hereby. 

Seller has duly and validly executed and delivered this Agreement and

the Seller Ancillary Agreements. 

Assuming that this Agreement creates and embodies legal, valid and enforceable

obligations of Buyer, this Agreement creates legal, valid and enforceable

obligations of and that are binding upon Seller, except as such enforceability

may be limited by applicable bankruptcy, insolvency, moratorium, 




 




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reorganization or similar laws in effect which affect the enforcement

of creditors’ rights generally and by equitable limitations on the availability

of specific remedies.




 




5.3           Required

Consents.  Except as set forth in

Schedule 5.3, no consent, authorization or approval of, filing or registration

with, or cooperation from, any Governmental Authority or any other Person not a

party to this Agreement is necessary in connec­tion with the execution,

delivery and performance by Seller of this Agreement or Seller Ancillary

Agreements, or the consummation of the transactions contemplated hereby and

thereby, including without limitation the assignment of the Contracts to Buyer.




 




5.4           Noncontravention.  The execution, delivery and performance by

Seller of this Agreement and Seller Ancillary Agreements do not and will not

(i) violate any Law; (ii) violate or conflict with, result in a breach or

termination of, constitute a default or give any third party any additional

right (including a termination right) under, permit cancellation of, result in

the creation of any Lien upon any of the assets or properties of Seller under,

or result in or constitute a circumstance which, with or without notice or

lapse of time or both, would constitute any of the foregoing under, any

instrument or contract to which Seller is a party or by which Seller or any of

its assets or properties are bound; (iii) permit the acceleration of the

maturity of any indebtedness of Seller or indebtedness secured by Seller’s assets

or properties; or (iv) violate or conflict with any provision of any of the

Certificate of Incorporation, By-Laws or similar organizational instruments of

Seller.




 




5.5           Ownership

of the Acquired Assets.  Seller is

and immediately prior to the Effective Time will be, the true and lawful owner

of the Acquired Assets, and will have the right to sell and transfer to Buyer

such Acquired Assets, free and clear of any Liens (other than Permitted Liens).

To the best of Seller’s knowledge and belief, the delivery to Buyer of the

instruments of transfer of ownership contemplated by this Agreement will vest

good and marketable title to the Acquired Assets in Buyer, free and clear of

all Liens (other than Permitted Liens). 

The Acquired Assets include all rights and assets sufficient to conduct

the Farberware Business in all material respects in the same manner as the

Farberware Business has been conducted by Seller prior to the Closing Date.




 




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5.6           Litigation.  Seller is not a party to or, to the best

knowledge of Seller, threatened with and neither is any Acquired Asset subject

in any material respect to, any litigation, suit, action or proceeding  before any court, administrative agency or

other governmental authority (collectively, “Legal Proceedings”) relating to or

affecting the Acquired Assets.




 




5.7           Intellectual Property.




 




5.7.1        Schedule 5.7.1(A)(1) sets forth a list of

the countries in which Seller is the registered owner of the trademark

“Farberware” (whether or not registered or applied for), including the

respective registration or application numbers, if available.  Schedule 5.7.1(A)(2) sets forth a list of

the countries in which, to the best of Seller’s knowledge, Seller or a

predecessor in title is either the registrant of or the applicant for the

trademark “Farberware” (whether or not registered or applied for), including

the respective registration or application numbers, if available.  Schedule 5.7.1(B) sets forth a list of all

trademarks, other than “Farberware” (whether or not registered or applied for)

including the respective registration or application numbers, if available,

registered or pending in the United States that, in each case, are owned by

Seller.  Schedule 5.7.1(C)(1) sets forth

a list of all trademarks, other than “Farberware” (whether or not registered or

applied for), including the respective registration or application numbers, if

available, registered or pending in a country other than the United States

that, in each case are owned by Seller. 

Schedule 5.7.1(C)(2) sets forth a list of all trademarks, other than

“Farberware” (whether or not registered or applied for), including the

respective registration or application numbers, if available, registered or

pending in a country other than the United States that, in each case, to the

best of Seller’s knowledge, are owned by Seller or a predecessor in title.




 




5.7.2        Seller has the exclusive right (subject

to the Contracts) to use the name “Farberware” in those countries listed in

Schedule 5.7.1(A)(1) and, to the best of Seller’s knowledge, in Schedule

5.7.1(A)(2), in the manner and for the purposes now being used by Seller and

its licensees under the Contracts, without infringing the rights of third 




 




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parties. 

Notwithstanding anything herein to the contrary, Seller makes no

representations and warranties as to its rights to use the name “Farberware” in

Panama, Colombia, South Korea, Spain, British Virgin Islands, or Thailand.




 




5.7.3        Set forth on Schedule 5.7.3(A) is a list

of all issued letters patent or applications therefor that are owned by Seller,

including the respective registration or application numbers, if available,

specifying as to each the jurisdictions by or in which such letters patent have

been issued or registered or in which an application for such issuance or

registration has been filed.  Set forth

on Schedule 5.7.3(B) is a list of all issued letters patent or applications

therefor that, to the best of Seller’s knowledge, are owned by Seller or a

predecessor in title, including the respective registration or application

numbers, if available, specifying as to each the jurisdictions by or in which

such letters patent have been issued or registered or in which an application

for such issuance or registration has been filed.




 




5.7.4        Set forth on Schedule 5.7.4 is a list of

all domain names (or other uniform resource locators on the Internet) (whether

or not registered or applied for) that are owned by Seller, including the

respective registration or application numbers, if available.




 




5.7.5        Except for the Contracts, no agreement,

oral or written, exists to which Seller is a party and pursuant to which any

person is authorized to use any of Seller’s Intellectual Property Rights.  To the best of Seller’s knowledge and

belief, (i) Seller is not a party to any claim, suit, action or proceeding

which involves a claim of infringement of any intellectual property; (ii)

Seller does not have any knowledge of any infringement by any other person of

any of Seller’s Intellectual Property Rights; and (iii) there have been no

claims made or proceedings instituted, nor is Seller aware of having received

any notice claiming that, any of Seller’s Intellectual Property Rights

infringes or conflicts with the asserted rights of others.




 




5.7.6        Except for those listed on Schedules

5.7.1(A)(1), 5.7.1(A)(2), 5.7.1(B), 5.7.1(C)(1), 5.7.1(C)(2), 5.7.3(A),

5.7.3(B) and 5.7.4, no other trademarks, tradenames, 




 




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service marks, registered copyrights, registered

domain names, patents or other intellectual property are used by Seller or in

connection with, or are material to the conduct of, the Farberware Business.




 




5.8           Books

and Records.  The material records

of Seller relating to the Acquired Assets are in all material respects true and

complete and have been maintained in accordance with reasonable business

practices.




 




5.9           No

Employees.  Seller has no employees

or contract workers.




 




5.10         Royalties.  Seller has delivered to Buyer a schedule

titled “Syratech Corporation; Farberware Royalties 1996-2001,” which schedule

has been initialed by Seller and Buyer, that is a true and complete statement

of the royalties collected by Seller since February 2, 1996, pertaining to periods

prior to September 30, 2001, under the Contracts or any prior, lapsed or

expired contracts; provided, however, that the amount shown for Target Home

Products pertains to the twelve (12)-month period ending June 30, 2002.




 




5.11         Contracts.




 




5.11.1  Exhibit B contains a list of all licenses,

contracts, commitments, guarantees or undertakings, whether written or oral,

that relate to the Acquired Assets, Seller’s Intellectual Property Rights or

the Farberware Business and are currently in effect.  Except as set forth on Exhibit B, there are (i) no amendments or

modifications to any Contract, and (ii) no other licenses, contracts,

commitments, guarantees or undertakings, whether written or oral, that relate

to the Acquired Assets, Seller’s Intellectual Property Rights or the Farberware

Business.




 




5.11.2  Seller has made available to Buyer complete

and correct copies of all Contracts listed on Exhibit B that exist in written

form. The descriptions contained in Exhibit B of all Contracts listed therein

that do not exist in written form are complete and correct.




 




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5.11.3  Seller is not in material default (including

events which with notice or the passage of time would result in a default)

under the terms of any Contract listed on Exhibit B, nor, to the best of

Seller’s knowledge and belief, is any other party thereto in default.  To the best of Seller’s knowledge and

belief, each of the Contracts listed in Exhibit B is valid and in full force

and effect (unless otherwise stated) and no party has notified Seller in

writing of its intention to terminate such Contract, cease to perform any

material services required to be performed by it or withhold any material

payment required to be made by it thereunder or of any claim or any material

default thereunder.




 




5.12         Product

Warranty and Product Liability.




 




5.12.1  Seller has delivered to Buyer a schedule

titled “Farberware Inc.; Product Liability Claims,” which schedule has been

initialed by Seller and Buyer, that sets forth a complete and accurate summary

of all material (which, for purposes of this Section 5.12.1 means amounts in

excess of Two Thousand Five Hundred Dollars ($2,500)) product liability claims

made against Seller relating to the Farberware Business in the past two (2)

years.




 




5.12.2  Seller has delivered to Buyer a schedule

containing the captions “Farberware Inc.; Bruckner Manufacturing Billings and

Payments,” “Farberware Inc. Berwick Warranty Claims Paid,” and “Meyer Warranty

Claims Paid,” which schedule has been initialed by Seller and Buyer, that is a

true and complete statement of the amounts paid and collected by Seller in

connection with warranty claims related to the Farberware Business for the

prior five (5) years.




 




ARTICLE VI.




 




Representations and Acknowledgements

of Buyer




 




Buyer represents to Seller as follows:




 




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6.1           Organization

and Good Standing.  Buyer is a

limited liability company duly organized, validly existing and in good standing

under the laws of the State of Delaware, with all requisite power and authority

to own, lease and operate its business and properties and to carry on its

business as presently conducted by it. 

Buyer further represents and warrants that it is a newly formed entity established

solely for purposes of conducting a business with the Acquired Assets.  Buyer represents and warrants that it has

sufficient assets to perform any and all of its obligations to Seller and

Syratech pursuant to this Agreement.




 




6.2           Power,

Authorization and Validity.  Buyer

has full power and authority to enter into this Agreement and the other

agreements provided for herein to which it is a party (the “Buyer Ancillary

Agreements”), and to consummate the transactions contemplated hereby.  The execution, delivery and performance by

Buyer of this Agreement and Buyer Ancillary Agreements have been duly and

validly approved by the managers and members of Buyer and no other actions or

proceedings on the part of Buyer are necessary to authorize this Agreement and

the transactions contemplated hereby. 

Buyer has duly and validly executed and delivered this Agreement and the

Buyer Ancillary Agreements.  Assuming

that this Agreement creates and embodies legal, valid and enforceable

obligations of Seller, this Agreement creates valid and binding obligations of

and that are binding upon Buyer, enforceable in accordance with its terms,

except as such enforceability may be limited by applicable bankruptcy,

insolvency, moratorium, reorganization or similar laws in effect which affect

the enforcement of creditors’ rights generally and by equitable limitations on the availability of specific remedies.




 




6.3           Required

Consents.  No consent, authorization

or approval of, filing or registration with, or cooperation from, any

Governmental Authority or any other Person not a party to this Agreement is

necessary in connection with the execution, delivery and performance by Buyer

of this Agreement or Buyer Ancillary Agreements, or the consummation of the

transactions contemplated hereby and thereby.




 




6.4           Noncontravention.  The execution, delivery and performance by

Buyer of this Agreement and Buyer Ancillary Agreements do not and will  not

(i) violate any Law; (ii) violate or conflict with, result in a breach or

termination of, constitute a default or give any third party 




 




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additional rights (including a termination right) under, permit

cancellation of, result in the creation of any Lien upon any of the assets or

properties of Buyer under, or result in or constitute a circumstance which,

with or without notice or lapse of time or both, would constitute any of the

foregoing under, any instrument or contract to which Buyer is a party or by

which Buyer or any of its assets or properties are bound; (iii) permit the

acceleration of the maturity of any indebtedness of Buyer or indebtedness

secured by Buyer’s assets or properties; or (iv) violate or conflict with any

provision of the Certificate of Formation, Limited Liability Company Agreement

or similar organizational instruments of Buyer.




 




6.5           Abandoned

Intellectual Property.  Schedule 6.5

sets forth certain intellectual property which Seller acquired pursuant to the

1996 Agreement, including certain foreign registrations for both trademarks and

patents existing in the name of Seller, which have not been used, maintained,

updated or confirmed since February 2, 1996. 

Buyer acknowledges that Buyer has been informed by Seller that since

February 2, 1996 Seller has abandoned and/or has allowed to lapse such

intellectual property referred to in Schedule 6.5.




 




6.6           Bankruptcy

of Licensee.  Buyer acknowledges

that it has been informed by Seller that Service Merchandise Co. Inc., which is

the holder of a significant Existing Farberware License, is the subject of

proceedings in a United States Bankruptcy Court.




 




6.7           Security

Interests and Consents.  Buyer

acknowledges that (i) it has been informed by Seller that Excel has a security

interest in certain of the Seller’s Intellectual Property Rights pursuant to

that certain Grant of Security Interest, dated January 29, 1999, made by Seller

in favor of Excel, and Buyer agrees that it will accept the assets described in

Section 2.1 subject to such security interest; (ii) it has been informed by

Seller that Bank of America has a security interest in certain of the Seller’s

Intellectual Property Rights pursuant to credit arrangements with Seller and/or

Syratech, which security interest will be terminated prior to the Effective

Time; and (iii) it has been informed by Seller that Seller cannot transfer the

assets described in Section 2.1 without the consent of LHC, U.S. Industries,

Inc., Excel and Bank of America.




 




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6.8           Financial

Resources.  Buyer represents and

warrants that it has available to it all funds necessary to meet its

indemnification obligations set forth in Section 11.2 hereof.




 




ARTICLE VII.




 




Covenants




 




7.1           Public

Announcements.  Buyer, on the one

hand, and Seller, on the other hand, shall not, and shall cause their

respective Affiliates not to, issue or cause the publication of any press

release or any other announcement with respect to this Agreement or the

transactions contemplated hereby without the consent of the other Party, except

where such release or announcement, in the reasonable opinion of counsel to the

disclosing Party, is required by applicable law; provided, however that in no

event shall any public announcement of this Agreement, or of the transactions

contemplated hereby or thereby, be made without prior notice and disclosure to,

and discussion with, the other Party hereto.




 




7.2           Sale

of Existing Inventory. Buyer shall allow Seller the right, for a period of

twelve (12) months from the Closing Date, to sell off existing Farberware inventory

owned by and in the possession of Seller (consisting of no more than Fifty

Thousand Dollars ($50,000) worth (Seller’s cost) of inventory) (the

“Inventory”), complete pending orders and otherwise wind up the business

transactions relating to the Inventory. Buyer and Seller, with the consent of

LHC, shall, at the Closing, enter into a license agreement in the form annexed

to this Agreement as Exhibit C (the “Trademark License Agreement”), pursuant to which Buyer shall grant to Seller (or

such Affiliate of Seller as Seller shall designate) a license for a term of

twelve (12) months to use the Farberware tradename and trademark on a

non-exclusive basis in connection with the sale of the Inventory.




 




7.3           Removal

of Equipment.  Seller shall allow

Buyer to store the Tools and Dies in Seller’s North Dighton, MA, warehouse (the

“North Dighton Warehouse”) at Seller’s cost and expense for a period of twelve

(12) months (the “Storage Period”) from the Closing Date.  Buyer shall either: (i) at its own cost and

expense, remove all of the Tools and Dies upon notice given to Seller of not

less than thirty (30) business days before the end of the Storage Period; (ii) 




 




14





























 




continue from and after the termination of the Storage Period to store

the Tools and Dies in the North Dighton Warehouse at its own cost and expense

in accordance with arrangements made with the landlord of the North Dighton

Warehouse; or (iii) notify Seller at least sixty (60) days before the end of the

Storage Period of its intention to abandon the Tools and Dies to Seller, in

which case Buyer shall execute any instrument of conveyance regarding the Tools

and Dies reasonably requested by Seller. 

Buyer shall have the right to enter the North Dighton Warehouse solely

for purposes of inspection of the Tools and Dies upon five (5) business days

notice to Seller.  Buyer acknowledges

that it is purchasing the Tools and Dies on an “as is, where is” basis,

therefore Seller shall have no responsibility to Buyer for any loss or damage

to the Tools and Dies at any time during the Storage Period, up to and

including the removal, other than as a result of Seller’s or Syratech’s gross

negligence or willful misconduct.  Buyer

shall maintain adequate insurance coverage to insure against any and all loss

or damage that may occur in connection with the storage of the Tools and

Dies.  Buyer shall be responsible to

Seller and/or Seller’s landlord for any damage to the premises in connection

with the storing and removal of the Tools and Dies.




 




7.4           Name

Change.  From and after the Closing,

except in connection with the Trademark License Agreement, Seller will

discontinue using in the conduct of its business or in any other business the

name “Farberware” or any words or expression bearing any resemblance to or

likely to be confused with “Farberware”, and Seller will promptly change its

corporate name.




 




7.5           Confidentiality.  Subject to Section 7.1, (i) Seller and

Syratech, jointly and severally, agree after the Closing Date to maintain in

confidence all confidential or proprietary information relating to Seller, the

Farberware Business, or the Acquired Assets; and (ii) Buyer agrees after the

Closing Date to maintain in confidence all confidential or proprietary

information relating to Syratech, other than confidential information relating

to the Farberware Business or the Acquired Assets.




 




7.6           Delivery

of Books and Records.  Within thirty

(30) days of the Closing Date, Seller shall deliver to Buyer the material

records of Seller relating to the Acquired Assets.




 




15





























 




7.7           Buyer’s

Working Capital.  From and after

Closing, Buyer shall have working capital of not less than One Hundred Thousand

Dollars ($100,000).




 




ARTICLE VIII.




 




Conditions




 




8.1           Conditions

to Each Party’s Obligations. The respective obligations of each Party

hereto to effect the transactions contemplated by this Agreement shall be

subject to there having been (i) no order, statute, rule, regulation, executive

order, stay, decree, judgment or injunction enacted, entered, promulgated or

enforced by any court or governmental authority, or (ii) no litigation or

proceeding pending or, to the best knowledge of the Parties, threatened, which

in either case would have the effect of prohibiting or preventing the

consummation of the transactions contemplated by this Agreement.




 




8.2           Conditions

to Obligation of Buyer.  The

obligations of Buyer hereunder shall be subject to the fulfillment at or prior

to the Closing of the following additional conditions, any one or more of which

may be waived by Buyer:




 




8.2.1        the representations and warranties of

Seller contained in this Agreement shall be accurate in all material respects

on and as of the Closing Date as if made on and as of the Closing Date;




 




8.2.2        Seller shall have performed in all

material respects its covenants and obligations under this Agreement required

to be performed on or prior to the Closing Date pursuant to the terms hereof;




 




8.2.3        Buyer shall have been furnished with a

certificate, dated the Closing Date, executed by an officer of Seller

certifying to the fulfillment of the conditions specified in Sections 8.2.1 and

8.2.2;




 




16





























 




8.3           Conditions

to Obligation of Seller.  The

obligations of Seller hereunder shall be subject to the fulfillment at or prior

to the Closing of the following additional conditions, any one or more of which

may be waived by Seller:




 




8.3.1        the representations and warranties of

Buyer contained in this Agreement shall be accurate in all material respects on

and as of the Closing Date as if made on and as of the Closing Date;




 




8.3.2        Buyer shall have performed in all

material respects its covenants and obligations under this Agreement required

to be performed on or prior to the Closing Date pursuant to the terms hereof

and, shall have tendered the Purchase Price;




 




8.3.3        Seller shall have been furnished with a

certificate, dated the Closing Date, executed by an officer of Buyer,

certifying to the fulfillment of the conditions specified in Sections 8.3.1 and

8.3.2;




 




ARTICLE IX.




 




Deliveries at Closing




 




9.1           Deliveries

by Seller.  At the Closing, Seller

shall execute and deliver to Buyer the following:




 




(a)           one or more bill(s) of sale,

reasonably satisfactory in form to Buyer, containing absolute and irrevocable

assignments and such other documents, instruments and papers, if any, as shall

be necessary effectively (subject only to filing thereof with appropriate

authorities) to convey to, and confer upon, Buyer the Acquired Assets,

including, without limitation, one or more instrument(s) of assignment, in

recordable form, for the patents, tradenames and trademarks, domain names, and

other similar items comprising Seller’s Intellectual Property Rights, provided,

that, Buyer shall be responsible for, and pay all fees and expenses incident

to, the filing thereof with all relevant authorities;




 




17





























 




(b)           all consents, authorizations,

waivers, or approvals specified in Schedule 5.3;




 




(c)           a certificate of its secretary, in a

form reasonably satisfactory to Buyer, dated as of the Closing Date, as to (i)

its by-laws, as amended through the Closing Date; (ii) a good standing

certificate from the Secretary of State of Delaware; and (iii) the due adoption

and full force and effect of resolutions of the board of directors and sole

stockholder of Seller authorizing the execution, delivery and performance of

this Agreement.




 




9.2           Deliveries

by Buyer.  At the Closing, Buyer

shall execute and deliver to Seller the following:




 




(a)           payment of the Purchase Price;




 




(b)           one or more assumption agreement(s),

reasonably satisfactory in form to Seller, containing such duly executed

undertakings and such other documents as shall be necessary to evidence, and

bind Buyer to, the Assumed Liabilities and to relieve Seller of any liability

or obligation in respect thereof;




 




(c)           a certificate of a manager, in a form

reasonably satisfactory to Seller, dated as of the Closing Date, as to (i) its

certificate of formation, as in effect as of the Closing Date; (ii) a good

standing certificate from the Secretary of State of Delaware; and (iii) the due

adoption and full force and effect of the resolutions of the board of managers

of Buyer authorizing the execution, delivery and performance of this Agreement.




 




ARTICLE X.




 




[reserved]




 




18





























 




ARTICLE Xl.




 




Survival of

Representations; Indemnification




 




11.1         Survival

of Representations.  All

representations and warranties of Seller on the one hand, and Buyer on the

other, contained in this Agreement, any Seller Ancillary Agreement or any Buyer

Ancillary Agreement shall survive the Closing Date and will remain operative

and in full force and effect until the first (1st ) anniversary of the

Closing Date.




 




11.2         Agreement

to Indemnify.




 




11.2.1  Subject to the limitations set forth in this

Section 11.2, from and after the Effective Time, each of Seller and Syratech on

the one hand, and Buyer on the other hand (respectively, the “Indemnifying

Party”) agrees to indemnify and hold harmless the other party, its officers,

directors, agents, subsidiaries and Affiliates (each an “Indemnified Party”)

from and against any and all claims, damages, actions, suits, proceedings,

demands, assessments, adjustments, payments, costs and expenses including,

without limitation, reasonable legal fees (collectively, “Claims”): (i)            arising out of any breach by the

Indemnifying Party of any representation or warranty, or the non-fulfillment of

any covenant, given or made by it in this Agreement or any other document

executed by it pursuant hereto; (ii) any misrepresentation contained in any

certificate furnished by the Indemnifying Party pursuant to this Agreement; or

(iii) any and all actions, suits, claims or legal, administrative, arbitrative,

governmental or other proceedings or investigations against any Indemnified

Party arising out of such breach.




 




11.2.2  Seller and Syratech, jointly and severally,

further agree to indemnify and hold harmless Buyer from each Claim relating to

or arising out of (i) any Excluded Asset; and (ii) any Liability of Seller or

Syratech that is not an Assumed Liability.




 




11.2.3  Buyer further agrees to indemnify and hold

harmless Seller and Syratech from each Claim relating to or arising out of any

Acquired Assets or Assumed Liabilities, to the extent that it does not arise or

result from any fact or circumstance in existence on 




 




19





























 




or before the Effective Time the existence of which constitutes

a breach of a representation or warranty of Seller, or a breach of a covenant

made by Seller or Syratech, given or made by either Seller or Syratech in this

Agreement or in any Seller Ancillary Agreement.




 




11.3         Defense

of Claims.




 




11.3.1  An Indemnified Party shall promptly notify

an Indemnifying Party of any third party Claims commenced or asserted against

the Indemnified Party.  Upon receipt of

such notice, the Indemnifying Party shall promptly (i) at its expense undertake

the defense of the Indemnified Party against such third party Claim with

counsel of the Indemnifying Party’s choice reasonably satisfactory to the

Indemnified Party; and (ii) permit the Indemnified Party to participate in the

defense thereof and to retain separate counsel at the Indemnified Party’s

expense.  The Indemnifying Party shall

not settle a third party Claim without the prior written consent of the

Indemnified Party (which consent shall not be unreasonably withheld); provided,

however, if notice is given to an Indemnifying Party of the commencement of any

action and the Indemnifying Party does not, within 20 days after receipt of the

Indemnified Party’s notice, give notice to the Indemnified Party of its

intention to assume the defense thereof, the Indemnifying Party shall be bound

by any determination made in such action, or any compromise or settlement

effected by the Indemnified Party.  In

the event that the Indemnified Party reasonably concludes that an actual or

potential conflict of interest exists between the Indemnifying Party and the

Indemnified Party in connection with the defense of such action, following

notice to the Indemnifying Party describing and explaining the conflict the

Indemnified Party may employ its own counsel and assume its own defense, and

the reasonable fees and expenses of such counsel shall be paid by the

Indemnifying Party; provided, however that in the event that the Indemnified

Party is simultaneously represented by more than one firm, then during such

period of simultaneous representation, the Indemnifying Party shall only be

required to pay the fees and expenses of one firm.




 




20





























 




11.4         Survival

of Claims.  Notwithstanding anything

to the contrary contained herein, if, prior to the expiration of a particular

representation or warranty, an Indemnified Party makes a Claim for

indemnification under this Agreement, then the Indemnified Party’s rights to

indemnification under this Section 11 for such Claim shall survive any

expiration of such representation or warranty.




 




11.5         Limitations.  No Indemnified Party will be entitled to be

indemnified pursuant to this Section 11 with respect to consequential damages,

including, without limitation, consequential damages consisting of business

interruption or lost profits, or with respect to punitive damages.




 




ARTICLE XII




 




Miscellaneous




 




12.1         Amendment

and Modification. Subject to applicable law, this Agreement may be amended,

modified or supplemented only by a written agreement signed by the Parties

hereto with respect to any of the terms contained herein.




 




12.2         Waiver

of Compliance, Consents. Any failure of Buyer, on the one hand, or Seller

or Syratech, on the other hand, to comply with any obligation, covenant,

agreement or condition herein may be waived by Buyer or Seller, as the case may

be, only by a written instrument signed by the Party granting such waiver, but such waiver, or any failure to insist upon

strict compliance with such obligation, covenant, agreement or condition, shall

not operate as a waiver of, or estoppel with respect to, any subsequent or

other failure. Whenever this Agreement requires or permits consent by or on

behalf of any Party hereto, such consent shall be given in writing in a manner

consistent with the requirements for a waiver of compliance as set forth in

this Section 12.2.




 




12.3         No

Broker. Each of Buyer, on the one hand, and Seller and its Affiliates, on

the other hand, hereby represents and warrants that it has not engaged any

investment banker, broker or other similar Person in connection with the

transactions contemplated by this Agreement.




 




21





























 




12.4         Notices.  All notices and other communications

hereunder shall be in writing and shall be deemed to have been duly given when

delivered in person, by facsimile, or by nationally recognized overnight

courier to the respective Parties at the following addresses (or at such other

address for a Party as shall be specified by like notice):




 




if to Buyer:




 




FARBERWARE LICENSING COMPANY, LLC




c/o The Interface Group




300 First Avenue




Needham, MA 

02194




Attn:  Paul G.

Roberts, Esq.




Telephone: 

781-449-6500




Facsimile:  

781-449-6616




 




with a copy to:




 




Carol G. Wolff, Esq.




Sullivan & Worcester LLP




One Post Office Square




Boston, MA 02109




Telephone:  617-338-2877




Facsimile:  

617-338-2880




 




if to Seller:




 




c/o Syratech Corporation




175 McClellan Highway




East Boston, MA 02128-9114




Attn:       Mr.

Leonard Florence




Chairman of the Board,

President and Chief Executive Officer




Telephone: 

617-561-2200




Facsimile:   617-561-0275




 




with a copy to:




 




Faye A. Florence, Esq.




Vice President and General Counsel




Syratech Corporation




175 McClellan Highway




East Boston, MA 02128-9114




Telephone: 

617-561-2200




Facsimile:  

617-568-1361




 




22





























 




12.5         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; but neither this Agreement

nor any of the rights, interests or obligations hereunder shall be assigned by

either of the Parties hereto without the prior written consent of the other

Party.




 




12.6         Expenses.

Except as otherwise provided herein, whether or not the transactions

contemplated herein are consummated, all costs and expenses incurred in

connection with this Agreement and the transactions contemplated hereby shall

be paid by the Party incurring such costs or expenses, including, without

limitation, its legal expenses.




 




12.7         Governing

Law. This Agreement shall be governed by the laws of the Commonwealth of

Massachusetts applicable to agreements made and to be performed entirely within

such State.




 




12.8         Counterparts.

This Agreement may be executed in two or more counterparts, each of which shall

be deemed an original, but all of which together shall constitute one and the

same instrument.




 




12.9         Entire

Agreement.  This Agreement,

including the documents or instruments referred to herein, embodies the entire

agreement and understanding of the parties hereto in respect of the subject

matter contained herein.  There are no

restrictions, promises, representations, warranties, covenants, or

undertakings, other than those expressly set

forth or referred to herein. This Agreement supersedes all prior agreements and

understandings between the parties with respect to such subject matter.




 




12.10       No Third Party Beneficiaries.  This Agreement is not intended to, and does not, create any

rights or benefits in favor of any Person other than the Parties hereto.




 




12.11       Severability.  If any provision of this Agreement, or

the application thereof, is for any reason held to any extent to be invalid or

unenforceable, the remainder of this Agreement and application of such

provision to other persons or circumstances will be interpreted so as 




 




23





























 




reasonably to effect the intent of the Parties hereto.  The Parties further agree to replace such

unenforceable provision of this Agreement with a valid and enforceable

provision that will achieve, to the extent possible, the economic, business and

other purposes of the void or unenforceable provision.




 




12.12       Construction of Agreement.  The

language hereof will not be construed for or against any Party based solely on

that Party being the drafting Party.  A

reference to an article, section or exhibit will mean an article or section in,

or an exhibit to, this Agreement, unless otherwise explicitly set forth.  The titles and headings in this Agreement

are for reference purposes only and will not in any manner limit the

construction of this Agreement.  For the

purposes of such construction, this Agreement will be considered as a whole.




 




[remainder of page

intentionally left blank]




 




24





























 




IN WITNESS WHEREOF, Seller,

Syratech and Buyer have each caused this Agreement to be signed by its duly

authorized officer as of the date first above written.




 




	

  FARBERWARE INC.


  
	

   


  	

   


  	

   


  
	

  By:


  	

  /s/


  	

  Gregory W. Hunt


  	

   


  
	

   


  	

   


  	

  Name:  Gregory W. Hunt


  
	

   


  	

   


  	

  Title:    Vice President and Chief Financial

  Officer


  
	

   


  	

   


  	

   


  
	

  SYRATECH CORPORATION


  
	

   


  	

   


  	

   


  
	

  By:


  	

  /s/


  	

  Gregory W. Hunt


  	

   


  
	

   


  	

   


  	

  Name:  Gregory W. Hunt


  
	

   


  	

   


  	

  Title:    Vice President and Chief Financial

  Officer


  
	

   


  	

   


  	

   


  
	

  FARBERWARE LICENSING COMPANY,

  LLC


  
	

   


  	

   


  	

   


  
	

  By:


  	

  /s/


  	

  Irwin Chafetz


  	

   


  
	

   


  	

   


  	

  Name:  Irwin Chafetz


  
	

   


  	

   


  	

  Title:   

  Manager


  
							





 




[signature page to

Acquisition Agreement]




 




 




25