UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

  

FORM 8-K

 

 

 

CURRENT REPORT

 

PURSUANT TO SECTION 13 OR 15(D)

OF THE SECURITIES EXCHANGE ACT OF 1934

  

 

 

Date of Report (Date of earliest event reported):

March 2, 2015

 

Commission File Number: 0-29923

 

CUI Global, Inc.

(Name of Small Business Issuer in Its Charter)

 

 

 

Colorado 84-1463284
(State or jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

 

20050 SW 112th Avenue, Tualatin, Oregon 97062
(Address of Principal Executive Offices) (Zip Code)

 

(503) 612-2300

(Registrant’s telephone number)

 

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a- 12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.1 4d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 
 

  

Section 1 - Registrant’s Business and Operations

Item 1.01 Entry into a Material Definitive Agreement.

 

The Company entered into an Asset Purchase Agreement dated February 23, 2015 to acquire the assets of Tectrol, Inc., a Toronto, Canada corporation. This agreement will not become effective until approved by the appropriate authority of the Ontario Superior Court of Justice which is scheduled for hearing March 5, 2015.

 

Tectrol, Inc., an insolvent entity as that term is used in Canadian law, filed a Notice of Intention to Make a Proposal (NOI) on November 6, 2014 under Section 50.4 (1) of the Bankruptcy and Insolvency Act , R.S.C. 1985, c. B-3 , as amended. Phelps Canada Restructuring Inc. was appointed as the trustee in re the proposal of Tectrol Inc. under the NOI. Subsequent to filing the NOI, Tectrol, Inc., in consultation with the Trustee, solicited asset purchase offers in respect of Tectrol’s Business and assets on a going concern or other basis.

 

The purchase price for the acquisition of the assets was five million two hundred thousand dollars ($5,200,000) subject to good faith adjustments by the Parties according to the final value of the non-obsolete inventory conveyed and other closing adjustments.  Of the purchase price, the sum of one million two hundred thousand dollars ($1,200,000), subject to final closing adjustments, shall be placed into an interest bearing escrow account to be paid by the Escrow Agent to the Seller in twelve (12) monthly installments commencing on March 31, 2015.  In addition, the agreement calls for an earn-out/royalty payment of two percent (2%) of the gross sales (for specific, identified customers) over a period of three (3) years from the closing date, up to a maximum of $300,000, that may or may not be paid to the Seller within 90 days of each calendar year end, depending on performance by the identified customer(s).   

 

As a part of this acquisition strategy, CUI Global, Inc. formed a wholly owned Canadian corporate subsidiary, CUI-Canada, Inc., to receive these acquired assets. That entity entered into a five-year lease of the Toronto facility where Tectrol, Inc. was operating its business.

 

Item 7.01 Regulation FD Disclosure.

On March 2, 2015 the Company issued a press release announcing its entry into the Asset Purchase Agreement. A copy of the press release is attached hereto as Exhibit 99.3.

 

The information in this report furnished pursuant to this Item 7.01 shall not be deemed "filed" for purposes of Section 18 of the Exchange Act, or otherwise subject to liabilities of that section. It may only be incorporated by reference in another filing under the Securities Act of 1933, as amended, if such subsequent filing references this Item 7.01 of this Form 8-K.

 

Exhibit Number   Description
99.1   Asset Purchase Agreement
99.2   Lease
99.3   Press Release

 

 
 

  

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

Signed and submitted this 2 nd day of March 2015.

 

  CUI Global, Inc.
  By: /s/ William J. Clough
    William J. Clough, CEO/President

 

Exhibit 99.1 Asset Purchase Agreement
   
Exhibit 99.2 Lease
   
Exhibit 99.3 Press Release

 

 

 

 

Exhibit 99.1

 

EXECUTION VERSION

 

AGREEMENT OF PURCHASE AND SALE

 

BETWEEN

 

TECTROL INC. as

Seller

 

– and –

 

CUI-CANADA, INC.

as Buyer

 

FEBRUARY 23, 2015

 

 
 

 

Agreement of Purchase and Sale

 

AGREEMENT OF PURCHASE AND SALE

 

THIS AGREEMENT is dated as of February 23, 2015

 

B E T W E E N:

 

TECTROL INC. , a corporation existing under the laws of the Province of Ontario

 

(the “ Seller ”)

 

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CUI-CANADA, INC. , a corporation existing under the laws of the Province of Nova Scotia (“ CUI Canada ”)

 

(the “ Buyer ”)

 

WHEREAS:

 

A. On November 6, 2014, the Seller commenced insolvency proceedings by filing a Notice of

 

Intention to Make a Proposal (“ NOI ”) pursuant to the Bankruptcy and Insolvency Act (Canada) (the “ BIA ”). Duff & Phelps Canada Restructuring Inc. was appointed as the trustee in re the proposal of Tectrol Inc. (the “ Proposal Trustee ”) under the NOI.

 

B. Subsequent to filing the NOI, the Seller, in consultation with the Proposal Trustee, solicited asset purchase offers in respect of the Seller’s Business (as defined herein) and assets on a going concern or other basis (the “ Sale Process ”).

 

C. The Seller wishes to sell and the Buyer wishes to purchase the Purchased Assets (as defined below) upon and subject to the terms and conditions hereof.

 

THEREFORE , in consideration of the promises, mutual covenants and agreements contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the Parties (as defined below), each of the Parties hereto agree as follows:

 

Article 1

INTERPRETATION

 

1.1 Definitions

 

In this Agreement the following terms have the following meanings:

 

Agreement of Purchase and Sale

 

 
 

 

1.1.1 “ Accounts Receivable ” means all accounts receivables, bills receivable, trade accounts, trade debts and book debts and insurance claims due or accruing due in connection with the Business, including any refunds and rebates receivable relating to the Business or the Purchased Assets and the full benefit of all security (including cash deposits), guarantees and other collateral held by the Seller, or a related party to the Seller, relating to the Business and all bank accounts;

 

1.1.2 “ Accounts Receivable Records ” has the meaning set out in Section 1.1.25.2;

 

1.1.3 “ Agreement ” means this agreement of purchase and sale, including all Schedules and Exhibits attached hereto, as it may be supplemented, amended, restated or replaced from time to time by written agreement between the Parties;

 

1.1.4 “ Applicable Law ” means, at any time, with respect to any Person, property, transaction or event, all applicable laws, statutes, regulations, treaties, judgments and decrees and (whether or not having the force of law) all applicable official directives, rules, consents, approvals, by-laws, permits, authorizations, guidelines, order and policies of any Governmental Authority having authority over that Person, property, transaction or event;

 

1.1.5 “ Approval and Vesting Order ” has the meaning given in Section 5.3.1;

 

1.1.6 “ Assumed Contracts ” means the agreements and licenses listed in Schedule “1” hereto being assumed by the Buyer on the Closing Date, including, but not limited to, the CBA and the SAP software program;

 

1.1.7 “ Assumed Obligations ” has the meaning given in Section 2.3;

 

1.1.8 “ BIA ” has the meaning set out in Recital A;

 

1.1.9 “ Books and Records ” means all information in any form relating to the Business, including books of account, financial and accounting information and records, personnel records, tax records, sales and purchase records, customer and supplier lists, list of potential customers, referral sources, research and development reports and records, production reports and records, business reports, laboratory reports and logs, plans and projections, marketing and advertising materials and all other documents, files, correspondence and other information (whether in written, printed, electronic or computer printout form, or stored on computer discs or other data and software storage and media devices, including, without limitation, with respect to the SAP and accounting software), other than the Accounts Receivable Records;

 

1.1.10 “ Business ” means the business of the Seller operated out of the Premises, including the manufacturing and distribution of power supply units for electronic devices;

 

1.1.11 “ Business Day ” means any day excluding a Saturday, Sunday or statutory holiday in the Province of Ontario, and also excluding any day on which the principal chartered banks located in the City of Toronto are not open for business during normal banking hours;

 

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1.1.12 “ Closing ” means the successful completion of the Transaction;

 

1.1.13 “ Closing Adjustments ” shall mean the following adjustments to the Purchase Price as at the Time of Closing or otherwise set out herein:

 

1.1.13.1 a post-Closing Inventory adjustment to be applied by the Seller and the Buyer within thirty (30) days of Closing, in the event that the final book value of the Inventory decreases, or increases, in an amount equal to $50,000 or more as at February 28, 2015, compared to the book value as at November 30, 2014, based solely on the Inventory Valuation Methodology;

 

1.1.13.2 an amount equal to the aggregate sum of the key employment retention plan (the “ KERP ”) set up by the Seller and offered to certain of its employees, and which the Buyer shall continue to pay from the Time of Closing in accordance with the details described in the attached Schedule “11” hereto, which amount shall be converted from CAD to the USD Equivalent for the purpose of Closing. The Buyer shall incorporate the KERP terms, as described in Schedule “11” hereto, into a new payment arrangement with those employees entitled to the KERP (the “ KERP Employees ”), which arrangement shall include a release in favour of the Seller to be executed by each of the KERP Employees releasing the Seller of all obligations relating to the KERP payments arising after Closing. In the event that any of the KERP Employees resign or are terminated for cause prior to, or not paid in accordance with, a scheduled KERP payment, the Buyer shall reimburse the Seller an amount equal to the payment(s) that would otherwise be payable to such KERP Employee(s) within seven (7) Business Days of such resignation or termination being effective;

 

1.1.13.3 an amount equal to any and all liabilities or obligations arising or accruing from the use of the Purchased Assets in the ordinary course of business, other than liabilities arising from an accident or negligence, from March 1, 2015 to the Closing Date shall be reimbursed by the Buyer to the Seller, which amount shall be finalized by the Parties within thirty (30) days of Closing and converted from CAD to the USD Equivalent; provided that the Seller shall reimburse the Buyer for any amounts paid by the Buyer in respect of liabilities relating to the use of the Purchased Assets in the ordinary course of business arising prior to March 1, 2015; and

 

1.1.13.4 an amount equal to the Employee Liabilities for the Hired Employees and the Union Employees for the period from March 1, 2015 to the Closing Date shall be reimbursed by the Buyer to the Seller, which amount shall be finalized by the Parties within thirty (30) days of Closing and converted from CAD to the USD Equivalent; unless such Employee Liabilities are paid directly by the Buyer;

 

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1.1.14 “ Closing Date ” means the second Business Day following the date on which the Approval and Vesting Order is granted, or such later date as agreed upon by the Parties in writing;

 

1.1.15 “ Communication ” means any notice, demand, request, consent, approval or other communication which is required or permitted by this Agreement to be given or made by a Party hereto;

 

1.1.16 “ Confidentiality Agreement ” means the confidentiality agreement entered into between FOCUS Investment Banking LLC, the Seller and CUI Global Inc. dated as of November 11, 2014, as same may be amended, restated, amended and restated, modified, supplemented or replaced from time to time;

 

1.1.17 “ Confidential Information ” has the meaning given to that term in the Confidentiality Agreement;

 

1.1.18 “ Court ” means the Ontario Superior Court of Justice (Commercial List);

 

1.1.19 “ CUI Proposal ” means the proposal regarding asset purchase of Tectrol Inc. executed and delivered by CUI Global Inc. to the Seller, and acknowledged by the Seller, on January 23, 2015, a copy of which is attached as Schedule “7” hereto;

  

1.1.20 “ Deposit ” has the meaning given in Section 2.6.1;

 

1.1.21 “ Employees ” means all individuals employed or retained by the Seller on a full-time, part-time or temporary basis in connection with the Business, excluding Union Employees;

 

1.1.22 “ Employee Liabilities ” means any liability imposed upon the Seller or the Buyer pursuant to any federal or provincial legislation pursuant to which such party is deemed to be a successor employer, related employer or otherwise responsible for or liable or payment of any amounts owing to any of the current or former Employees (including, but not limited to, the Hired Employees), whether pursuant to the Employment Standards Act, 2000 , S.O. 200, c. 41, the Pay Equity Act , R.S.O. 1990, c. P.7, or the Workplace Safety and Insurance Act, 1997 , S.O. 1997, c. 16, Sch. A. Without limiting the foregoing, Employee Liabilities shall include:

 

1.1.22.1 all salaries, wages, bonuses, commissions and other compensation (including accrued unpaid vacation pay and any retroactive pay) and all liabilities under employee pension and benefit plans relating to employment of the current or former Employees;

 

1.1.22.2 all severance payments, damages for wrongful dismissal and all related costs in respect of the termination by the Seller of the current or former Employees; and

 

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1.1.22.3 all liabilities for claims for injury, disability, death or workers’ compensation arising from or relating to employment in the Business;

 

1.1.23 “ Equipment ” means the equipment and tools of the Seller described in Schedule “2” hereto;

 

1.1.24 “ ETA ” means the Excise Tax Act (Canada);

 

1.1.25 “ Excluded Assets ” means any and all assets of the Seller other than the Purchased Assets, as the Buyer may advise prior to Closing, including, but not limited to, the following:

 

1.1.25.1 Cash and Accounts Receivable – all cash on hand, cash equivalents, bank deposits of the Seller and Accounts Receivable;

 

1.1.25.2 Accounts Receivable Records – ownership and title, but for greater certainty not possession, of all books of account, financial and accounting information and sales purchase records (whether in written, printed, electronic or computer printout form, or stored on computer discs or other data and software storage and media devices) necessary for the collection of the Accounts Receivable, Tax Refunds and Prepaid Expenses (collectively, the “ Accounts Receivable Records ”) until the earlier of (i) the date upon which the Seller receives all amounts in satisfaction of the Accounts Receivable, Prepaid Expenses and Tax Refunds, if any, and (ii) the date which is twelve (12) months following the Closing Date;

 

1.1.25.3 Prepaid Expenses – the full benefit of prepaid expenses of the Business by the Seller, or any related party on behalf of the Seller, and any and all deposits, including with any public utility, suppliers, lessor under any personal or real property lease or Governmental Authority (collectively, the “ Prepaid Expenses ”) including, but not limited to, the Prepaid Expenses listed in Schedule “9” hereto. For the purpose of Closing, the Parties agree and acknowledge that: (i) Schedule “9” shall be in draft form as at the Time of Closing; and (ii) the Parties shall reconcile and finalize a list of Prepaid Expenses to be included in Schedule “9” hereto within thirty (30) days of the Time of Closing; and

 

1.1.25.4 Tax Refunds – the benefit of any and all refundable Taxes or paid by the Seller net of any amounts withheld by any taxing authority, and any claim or right of the Seller to any refund, rebate Taxes, including, but not limited to, any SR&ED refunds or credits;

 

1.1.26 “ Excluded Liabilities ” has the meaning given in Section 2.4;

 

Agreement of Purchase and Sale

 

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1.1.27 “ Governmental Authority ” means any federal, provincial, state, local, municipal, regional, territorial, aboriginal, or other government, governmental or public department, branch, ministry, or court, domestic or foreign, including any district, agency, commission, board, arbitration panel or authority and any subdivision of the foregoing exercising or entitled or purporting to exercise any administrative, executive, judicial, ministerial, prerogative, legislative, regulatory or taxing authority or power of any nature; or any quasi-governmental or private body exercising any regulatory, expropriation or taxing authority under or for the account of any of the foregoing;

 

1.1.28 “ HST ” means all harmonized sales taxes payable under the ETA;

 

1.1.29 “ Hired Employees ” has the meaning set out in Section 3.1;

 

1.1.30 “ Intellectual Property ” means any and all trademarks, copyrights, patents, patent applications, industrial designs, engineering drawings, trade secrets, trade dress, trade styles or other logos owned by the Seller and all licenses related to the foregoing, any applications of and/or registrations by the Seller (whether domestic or foreign) in respect thereof, all software, know-how, hardware, servers and computers containing the foregoing, including, without limitation, the Intellectual Property described in Schedule “4” hereto;

 

1.1.31 “ Inventory ” means the inventory described in Schedule “3” hereto;

 

1.1.32 “ Inventory Valuation Methodology ” means the November 30, 2014 methodology agreed to by the Parties for valuing the Inventory as set out in Schedule “8” hereto;

 

1.1.33 “ NOI ” has the meaning set out in Recital A;

 

1.1.34 “ Parties ” means the Seller and the Buyer;

 

1.1.35 “ Person ” means an individual, body corporate, sole proprietorship, partnership or trust or unincorporated association, unincorporated syndicate, unincorporated organization, or another entity, and a natural person, acting in his or her individual capacity or in his or her capacity as executor, trustee, administrator or legal representative, and any Governmental Authority;

 

1.1.36 “ Premises ” means the premises leased by the Seller and municipally known as 39 Kodiak Crescent, Toronto, Ontario;

 

1.1.37 “ Proposal Trustee ” has the meaning set out in Recital A, and shall also include Duff & Phelps Canada Restructuring Inc. in such capacity as trustee in bankruptcy or receiver or court-appointed monitor in any future insolvency proceedings involving the Seller under the BIA or Companies’ Creditors Arrangement Act (Canada), as the case may be;

 

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1.1.38 “ Purchased Assets ” means the right, title and interest of the Seller in and to the Assumed Contracts, Intellectual Property, goodwill of the Business, Inventory and Equipment;

 

1.1.39 “ Purchase Price ” means $5,500,000.00, with payment of the Purchase Price to be made in accordance with Section 2.6 and allocation of the Purchase Price to be made in accordance with Section 2.7;

 

1.1.40 “ Required Consents ” means the consents listed in Schedule “5” hereto to the extent required under the applicable Assumed Contract and obtained by the Seller, using commercially reasonable efforts, with respect to the assignment of such Assumed Contract by the Seller to the Buyer;

 

1.1.41 “ Seller’s Solicitors ” means Borden Ladner Gervais LLP;

 

1.1.42 “ Time of Closing ” means 10:00 a.m. (Toronto Time) on the Closing Date or such other time on the Closing Date as the Parties may mutually agree;

 

1.1.43 “ Transaction ” means the transaction of purchase and sale contemplated by this Agreement;

 

1.1.44 “ Union Employee s” means individuals currently or formerly employed by the Seller in the Business of the Seller and governed by the Collective Bargaining Agreement (the “ CBA ”) with the International Brotherhood of Electrical Workers (the “ Union ”) entered into between the Seller and the Union effective from January 1, 2013 to December 31, 2015, which is listed as an Assumed Contract in Schedule “1” hereto;

  

1.1.45 “ U.S. Dollars ” or “ US $ ” each means the currency of the United States which, as at the time of payment or determination, is legal tender in the United States for the payment or determination of public or private debts; and

  

1.1.46 “ USD Equivalent ” means, on any Business Day, in relation to an amount denominated in Canadian Dollars (“ CAD ”), the amount expressed in US $ into which such CAD amount can be converted using the applicable Bank of Canada rate as at close of business on the day that is one Business Day prior to Closing.

 

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1.2 Entire Agreement

 

This Agreement, together with the agreements and other documents to be delivered pursuant to this Agreement, constitutes the entire agreement between the Parties pertaining to the subject matter of this Agreement and supersedes all prior agreements, understandings, negotiations and discussions, whether oral or written, of the Parties, other than the provisions of the Confidentiality Agreement, and there are no representations, warranties or other agreements between the Parties in connection with the subject matter of this Agreement except as specifically set out in this Agreement or the other agreements and documents delivered pursuant to this Agreement. This Agreement may not be amended or modified in any respect, except by written instrument signed by the Parties.

 

1.3 Time of Day

 

Unless otherwise specified, references to time of day or date mean the local time or date in the City of Toronto, Province of Ontario.

 

1.4 Business Day

 

Whenever any payment to be made or action to be taken under this Agreement is required to be made or taken on a day other than a Business Day, the payment is to be made or action taken on the next Business Day following.

 

1.5 Consent

 

Whenever a provision of this Agreement requires an approval or consent and such approval or consent is not delivered within the applicable time limit, then, unless otherwise specified, the Party whose consent or approval is required shall be conclusively deemed to have withheld its approval or consent.

 

1.6 Governing Law

 

This Agreement is governed by, and is to be construed and interpreted in accordance with, the laws of the Province of Ontario and the laws of Canada applicable in that Province.

 

1.7 Certain Rules of Interpretation

 

1.7.1 In this Agreement, words signifying the singular number include the plural and vice versa, and words signifying gender include all genders. Every use of the word “including” in this Agreement is to be construed as meaning “including, without limitation”.

  

1.7.2 The division of this Agreement into Articles and Sections, the insertion of headings and the provision of a table of contents are for convenience of reference only and do not affect the construction or interpretation of this Agreement.

 

1.7.3 eferences in this Agreement to an Article, Section, Schedule or Exhibit are to be construed as references to an Article, Section, Schedule or Exhibit of or to this Agreement unless the context requires otherwise.

 

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1.7.4 Unless otherwise specified in this Agreement, time periods within which or following which any payment is to be made or act is to be done will be calculated by excluding the day on which the period commences and including the day on which the period ends. If the last day of a time period is not a Business Day, the time period will end on the next Business Day.

 

1.7.5 Unless otherwise specified, any reference in this Agreement to any statute includes all regulations made under or in connection with that statute, and is to be construed as a reference to that statute as amended, supplemented or replaced.

 

1.7.6 Whenever an amount of money is referred to in this Agreement, that amount will, unless otherwise expressly stated, be in U.S. Dollars.

 

1.8 Schedules and Exhibits

 

The following is a list of Schedules and Exhibits:

 

Schedule Subject Matter Section Reference
     
Schedule 1 Assumed Contracts 1.1.6
     
Schedule 2 Equipment 1.1.23
     
Schedule 3 Inventory 1.1.31
     
Schedule 4 Intellectual Property 1.1.30
     
Schedule 5 Required Consents 1.1.40
     
Schedule 6 Allocation of Purchase Price 2.7
     
Schedule 7 CUI Proposal 1.1.19
     
Schedule 8 Inventory Valuation Methodology 1.1.32
     
Schedule 9 Prepaid Expenses 1.1.25.3
     
Schedule 10 List of Royalty Payment Customers 2.6.2.3
     
Schedule 11 KERP Payments 1.1.13.2
     
     
     
Exhibit Subject Matter Section Reference
     
Exhibit A Form of Approval and Vesting Order 5.3.1
     
Exhibit B Form of Bill of Sale 6.2.2/6.3.1

 

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Article 2

SALE AND PURCHASE AND ASSIGNMENT

 

2.1 Sale and Purchase of Purchased Assets

 

Subject to the terms and conditions of this Agreement, and relying upon the representations and warranties herein, the Seller hereby agrees to sell, assign, convey and transfer to the Buyer and the Buyer hereby agrees to purchase all right, title and interest of the Seller in and to the Purchased Assets on the Closing Date. The Buyer acknowledges that it is not purchasing any other assets, property or undertaking of the Seller other than the Purchased Assets.

 

2.2 Assignment and Assumption of Contracts

 

Subject to the conditions and terms of this Agreement, the Seller will use commercially reasonable efforts to assign to the Buyer, as set out herein, all of the Seller’s rights, benefits and interests in and to the Assumed Contracts, and will use commercially reasonable efforts to obtain the Required Consents prior to Closing. This Agreement and any document delivered under this Agreement will not constitute an assignment or an attempted assignment of any Assumed Contract contemplated to be assigned to the Buyer under this Agreement which is not assignable without the consent of a third party if that consent has not been obtained and that assignment or attempted assignment would constitute a breach of such Assumed Contract or, in the alternative, if an order of the Court authorizing and approving the assignment of the Assumed Contracts to the Buyer has not been obtained.

 

2.3 Assumed Obligations

 

From and after the Closing Date, the Buyer shall assume and be liable for the Assumed Obligations. The Assumed Obligations shall consist of the following:

 

a) all Employee Liabilities payable to or related to any Hired Employees arising from and after the Closing Date;

 

b) all KERP payments payable to or related to the KERP Employees described in the attached Schedule “11” hereto from and after the Closing Date pursuant to new payment arrangements to be entered into between the KERP Employees and the Buyer;

 

c) the Seller’s liabilities and obligations under any of the Assumed Contacts, as applicable; and

 

d) all liabilities arising or accruing from the use of the Purchased Assets from and after the Closing Date.

 

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Each of the Buyer and CUI Global Inc. shall indemnify the Seller from any and all claims or liabilities relating to any Assumed Obligations, including, but not limited to, the KERP payments and the Royalty Payment (as defined below), incurred from and after the Closing Date. The Buyer shall reimburse the Seller through the Closing Adjustments or otherwise provided for herein, for (i) all Employee Liabilities payable or related to the Hired Employees and the Union Employees for the period of March 1, 2015 to the Closing Date; and (ii) all liabilities and obligations arising or accruing from the use of the Purchased Assets in the ordinary course of business, other than liabilities arising from an accident or negligence, for the period of March 1, 2015 to the Closing Date.

 

2.4 Excluded Liabilities

 

Other than the Assumed Obligations, and the Assumed Contracts as described herein and set forth in Schedule “1” hereto, the Buyer shall not assume and shall not be liable for any other liabilities or obligations of any nature which are related in any way to the Seller (collectively, the “ Excluded Liabilities ”). For greater certainty, the Excluded Liabilities shall include, but not be limited to, the following:

 

a) Except as otherwise agreed in this Agreement, all taxes payable by the Seller referable to the period up to the Closing Date, including present and future federal and provincial income taxes, municipal business taxes, realty taxes and school taxes; and

 

b) all Employee Liabilities with respect to any former or current Employees as of the Closing Date; provided that the Buyer shall reimburse the Seller for all Employee Liabilities with respect to the Hired Employees and the Union Employees arising from and after March 1, 2015 to the Closing Date; unless such Employee Liabilities are paid directly by the Buyer.

 

2.5 “As is, Where is”

 

The Buyer acknowledges that the Seller is selling the Purchased Assets on an “as is, where is” basis as they exist on the Closing Date, and that as of the Closing Date, the Seller will have no further liability to the Buyer, other than those specifically set forth herein. The Buyer further acknowledges that it has entered into this Agreement on the basis that the Seller does not guarantee title to the Purchased Assets and that the Buyer has conducted such inspections of the condition of and title to the Purchased Assets that it deemed appropriate, and has satisfied itself with regard to these matters. No representation, warranty or condition is expressed or can be implied as to title, encumbrances, description, fitness for purpose, merchantability, condition, quantity or quality, assignability or in respect of any other matter or thing concerning the Purchased Assets or the right of the Seller to sell or assign them, save as expressly represented or warranted in this Agreement. Without limiting the generality of the foregoing, any and all conditions, warranties or representations expressed or implied pursuant to the Sale of Goods Act (Ontario) or similar legislation do not apply to this transaction of purchase and sale and have been waived by the Buyer. The description of the Purchased Assets contained in the Schedules hereto is for purposes of identification only. No representation, warranty or condition has or will be given by the Seller concerning the completeness or accuracy of those descriptions.

 

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2.6 Payment of the Purchase Price

 

The Buyer shall pay the Purchase Price to the Proposal Trustee as follows:

 

2.6.1 the sum of $550,000.00, representing 10% of the Purchase Price, the receipt of which the Proposal Trustee acknowledges, will be paid by the Buyer upon execution of this Agreement as a deposit (the “ Deposit ”) to be held by the Proposal Trustee in trust until the Closing and will be credited toward the Purchase Price upon Closing; and

 

2.6.2 the balance of the Purchase Price, after crediting the Deposit, will be paid as set forth in the CUI Proposal and as follows:

 

2.6.2.1 the sum of $3,450,000.00, to be paid to the Proposal Trustee upon Closing. Such amount shall be subject to the Closing Adjustments. For the purposes of Closing, the Inventory adjustment shall be based upon the book value of the Inventory as at February 28, 2015, compared to the book value as at November 30, 2014, based solely on the Inventory Valuation Methodology. Any amounts to be added to or deducted from the Purchase Price in respect of any Closing Adjustments, as the case may be, shall be added to or deducted from the Escrow Amount, as the case may be. In the event that (i) any amounts are to be added to the Escrow Amount in respect of the Closing Adjustments, such amounts shall be included and/or form part of the first Escrow Payment; and (ii) any amounts are to be deducted from the Escrow Amount in respect of the Closing Adjustments, such amounts shall be deducted from the last Escrow Payment and, to the extent that such Escrow Payment is insufficient, from the second last Escrow Payment and so forth;

 

2.6.2.2 the sum of $1,200,000 (the “ Escrow Amount ”), to be paid to the Seller’s Solicitors (the “ Escrow Agent ”), which funds shall be placed into an interest bearing escrow account. The Escrow Amount shall be paid by the Escrow Agent to the Proposal Trustee in twelve (12) monthly installments of $100,000 on the last day of each month, commencing on March 31, 2015, until such time as the Escrow Amount is indefeasibly paid in full (the “ Escrow Payments ” and each, an “ Escrow Payment ”); and

 

2.6.2.3 a royalty rate payment equal to two percent (2%) of the gross sales over a period of three (3) years from the Closing Date, to be measured annually, related to specific customers of the Seller set forth in Schedule “10” hereto. Up to an amount of $300,000 (the “ Royalty Payment ”) shall be paid by the Buyer to the Proposal Trustee within 90 days of each calendar year end, and shall be accompanied by a letter from the Buyer’s auditor confirming the gross sales relating to the Royalty Payment for the applicable year end.

 

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The Proposal Trustee agrees to cause the Deposit to be placed into an interest bearing account or certificate of deposit, with all interest earned or accrued to be paid or credited to the Buyer at the Time of Closing, unless the Buyer forfeits the Deposit as provided below, in which event the interest will be paid to the Seller. Unless otherwise agreed, all amounts payable to the Proposal Trustee either by way of Deposit or at the Time of Closing will be paid to the Proposal Trustee by cheque certified by, or bank draft of, a major Canadian bank listed in Schedule I to the Bank Act (Canada) or by wire transfer in accordance with wire transfer instructions provided in writing by the Proposal Trustee to the Buyer. The Buyer acknowledges and agrees that the Deposit is non-refundable except as provided under Section 6.8.

 

2.7 Allocation of Purchase Price

 

The Purchase Price will be allocated among the Purchased Assets in accordance with Schedule “6” hereto. The Parties agree to report the sale and purchase of the Purchased Assets for all federal, provincial and local tax purposes in a manner consistent with such allocation.

 

2.8 Taxes

 

2.8.1 The Buyer will pay upon Closing, in addition to the Purchase Price, all applicable federal and provincial taxes eligible in connection with the purchase and sale of the Purchased Assets, including, without limitation, HST and any other provincial sales tax, and shall provide the Seller with proof of payment of such taxes. Alternatively, where applicable, the Buyer will have the option to furnish the Seller with appropriate exemption certificates.

 

2.8.2 Alternatively, if applicable, the Buyer and the Seller shall jointly make the election provided for under subsection 167(1.1) of the ETA such that no HST will be payable in respect of the Transaction. The Buyer and the Seller shall jointly complete the election form in respect of such election and the Buyer hereby irrevocably appoints the Seller (or its authorized representatives) as its agent to file the said election form no later than the due date for the Buyer’s HST returns for the first reporting period in which HST, as applicable, would, in the absence of such election, become payable in connection with the Transaction contemplated herein.

 

2.8.3 The Buyer agrees to indemnify and save the Seller harmless from and against all claims and demands for payment of all applicable taxes in connection with this Agreement and the Transaction, including penalties and interest and any liability or costs incurred as a result of any failure to pay those taxes when due.

 

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Article 3

EMPLOYEE MATTERS

 

3.1 Offers to Employees

 

No later than two (2) Business Days prior to the Closing Date, the Buyer shall offer employment, on terms and conditions which are substantially similar in the aggregate to the current terms provided, commencing on the Closing Date (or such later date on which those Employees who are on leave return to active service) to those Employees that the Buyer, in its sole discretion, desires to hire. The Employees who accept the Buyer’s offer of employment are collectively referred to herein as the “Hired Employees”. For greater certainty, the Buyer shall not be obligated to offer employment to any Employee.

 

3.2 Employee Remuneration, Benefits and Deductions

 

The Buyer shall be liable for the payment for all legal obligations relating to the employment on and after the Closing Date and all Hired Employees and, for greater certainty, all Union Employees (other than accrued vacation and unpaid payroll accruing up to February 28, 2015 and subject to the Closing Adjustments). The Buyer shall not be responsible for any wages, statutory deductions, vacation pay, remittances, assessments, bonuses, notice of termination, termination pay, severance pay, sick leave or other remuneration, benefits or deductions in respect of the Employees prior to March 1, 2015. Except as required by statute or common law, the Buyer shall have no obligation to recognize the service of Hired Employees pursuant to Section 3.1 herein. All items in respect of the Hired Employees and Union Employees, including Employee Liabilities, which are payable to, receivable by or accrued in favour of the Hired Employees and the Union Employees up to and including the Closing Date, even if not then due, shall be the responsibility of the Seller; provided that the Buyer shall reimburse the Seller for such items in accordance with the Closing Adjustments.

 

3.3 Union Employees

 

The provisions of this Article 3 insofar as they relate to Union Employees shall be subject and subordinate to the provisions of the CBA and the Buyer shall be bound as a successor employer to such CBA to the extent required by statute or common law and the terms of this Agreement.

 

Article 4

REPRESENTATIONS AND WARRANTIES

 

4.1 Buyer’s Representations and Warranties

 

The Buyer represents and warrants to the Seller and the Proposal Trustee that:

 

4.1.1 the Buyer is a corporation duly incorporated, organized and subsisting under the laws of the Province of Nova Scotia;

 

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4.1.2 the Buyer has all necessary corporate power, authority and capacity to enter into this Agreement and to perform its obligations and the execution and delivery of this Agreement and the consummation of the Transaction have been duly authorized by all necessary corporate action on the part of the Buyer;

 

4.1.3 the Buyer is not a party to, bound or affected by or subject to any indenture, agreement, instrument, charter or by-law provision, order, judgment or decree which would be violated, contravened or breached by the execution and delivery by it of this Agreement or the performance by it of any of the terms contained in this Agreement;

 

4.1.4 to the best of the Buyer’s knowledge, no actions or proceedings are pending or have been threatened to restrain or prohibit the completion of the Transaction;

 

4.1.5 this Agreement and each of the other documents contemplated under this Agreement to which the Buyer is or will be a Party have been or will be, as at the Time of Closing, duly and validly executed and delivered by the Buyer and constitutes or will, as at the Time of Closing, constitute legal, valid and binding obligations of the Buyer, as the case may be, enforceable in accordance with their terms;

 

4.1.6 the Buyer is not a non-Canadian person as defined in the Investment Canada Act ; and

 

4.1.7 the Buyer is or will be registered under Part IX of the Excise Tax Act (Canada) on or before the Time of Closing.

 

4.2 Seller’s Representations and Warranties

 

The Seller represents and warrants to the Buyer that:

 

4.2.1 the Seller has the right to enter into this Agreement and complete the Transaction;

 

4.2.2 the Seller is not a non-resident of Canada within the meaning of that term as used in the Income Tax Act (Canada);

 

4.2.3 the Seller has done no act to encumber the Purchased Assets since the filing of the NOI;

 

4.2.4 the Seller has not previously sold the Purchased Assets; and

 

4.2.5 to the best of the Seller’s knowledge, no actions or proceedings are pending and none have been threatened to restrain or prohibit the completion of the Transaction.

 

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Article 5

CONDITIONS

 

5.1 Conditions in favour of the Buyer

 

The obligation of the Buyer to complete the Transaction is subject and conditional to the satisfaction of the following conditions on or prior to the Time of Closing:

 

5.1.1 all representations and warranties of the Seller contained in this Agreement will be true as of the Closing Date with the same effect as though made on and as of that date;

 

5.1.2 no action or proceedings will be pending or threatened to restrain or prohibit the completion of the Transaction contemplated by this Agreement;

 

5.1.3 the Buyer obtaining confirmation in writing, in a form satisfactory to the Buyer, from 454675 Ontario Limited (the “ Landlord ”) that all maintenance and upkeep relating to the Premises, as well as all taxes and other fees due and payable under the lease dated February 1, 1987 (the “ Lease ”) are current;

  

5.1.4 the Buyer obtaining confirmation in writing from the Landlord that the Buyer and the Landlord have entered into a new lease arrangement (the “ CUI Lease ”) in connection with the Premises effective as at the Closing Date in form satisfactory to the Buyer and the Landlord, which CUI Lease shall be a triple net lease at market rate and on market terms, as determined by an independent consultant, and guaranteed by CUI Global Inc.;

 

5.1.5 the Seller will have performed each of its obligations set out under this Agreement and the CUI Proposal to the extent required to be performed on or before the Closing Date; and

 

5.1.6 no material loss or damage to the Purchased Assets will have occurred on or before the Closing Date.

 

The foregoing conditions are for the exclusive benefit of the Buyer. Any condition may be waived by the Buyer in whole or in part. Any such waiver will be binding on the Buyer only if made in writing.

 

5.2 Conditions in favour of the Seller

 

The obligation of the Seller to complete the Transaction is subject and conditional to the satisfaction of the following conditions on or prior to the Time of Closing:

 

5.2.1 all representations and warranties of the Buyer contained in this Agreement will be true as of the Closing Date with the same effect as though made on and as of that date;

 

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5.2.2 no action or proceedings will be pending or threatened to restrain or prohibit the completion of the Transaction contemplated by this Agreement;

 

5.2.3 the Buyer will have performed each of its obligations set out under this Agreement and the CUI Proposal to the extent required to be performed on or before the Closing Date;

 

5.2.4 the Seller obtaining confirmation in writing from the Landlord, in a form satisfactory to the Seller, confirming that the Buyer and the Landlord have entered into the CUI Lease; and

 

5.2.5 no material loss or damage to the Purchased Assets will have occurred on or before the Closing Date.

 

The foregoing conditions are for the exclusive benefit of the Seller. Any condition may be waived by the Seller in whole or in part. Any such waiver will be binding on the Seller only if made in writing.

 

5.3 Conditions—Approval and Vesting Order

 

The obligations of the Seller and the Buyer to complete the Transaction are subject to the following conditions being fulfilled or performed at or prior to the Time of Closing:

 

5.3.1 an order will have been made by the Court on or before March 3, 2015 approving this Agreement and the Transaction and vesting in the Buyer all the right, title and interest of the Seller in the Purchased Assets free and clear of all liens, security interests and other encumbrances, that order to be substantially in the form of the order attached as Exhibit A hereto (the “ Approval and Vesting Order ”); and

 

5.3.2 the Approval and Vesting Order will not have been stayed, varied or vacated and no order will have been issued and no action or proceeding will be pending to restrain or prohibit the completion of the Transaction.

 

The Parties hereto acknowledge that the foregoing conditions are for the mutual benefit of the Seller and the Buyer.

 

5.4 Non-Satisfaction of Conditions

 

If any condition set out in this Article is not satisfied or performed prior to the time specified therefor, a Party for whose benefit the condition is inserted may in writing:

 

5.4.1 waive compliance with the condition in whole or in part in its sole discretion by written notice to the other Party and without prejudice to any of its rights of termination in the event of non-fulfilment of any other condition in whole or in part; or

 

5.4.2 elect on written notice to the other Party to terminate this Agreement before Closing.

 

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Article 6

CLOSING

 

6.1 Closing

 

The completion of the Transaction will take place at the offices in Toronto, Ontario of Borden Ladner Gervais LLP, on the Closing Date at the Time of Closing or as otherwise determined by mutual agreement of the Parties in writing.

 

6.2 Buyer’s Deliveries on Closing

 

At or before the Time of Closing, the Buyer will execute and/or deliver to the Seller and the Proposal Trustee the following, each of which will be in form and substance satisfactory to the Seller and the Proposal Trustee, acting reasonably:

 

6.2.1 payment of the balance of the Purchase Price as contemplated in Section 2.6.2;

 

6.2.2 a bill of sale substantially in the form of Exhibit B attached hereto in connection with the Purchased Assets;

 

6.2.3 a bring down certificate dated the Closing Date, confirming that all of the representations and warranties of the Buyer contained in this Agreement are true as of the Closing Date, with the same effect as though made on and as of the Closing Date;

 

6.2.4 an acknowledgment dated the Closing Date, confirming that each of the conditions precedent in Section 5.1 of this Agreement and the CUI Proposal have been fulfilled, performed or waived as of the Closing Date;

 

6.2.5 if necessary, payment or evidence of payment of applicable taxes or, if applicable, appropriate tax exemption certificates in accordance with Section 2.8;

 

6.2.6 if necessary, an assignment and assumption agreement as contemplated by Sections 2.2 and 1.1.6; and

 

6.2.7 any other documentation as is referred in this Agreement or as the Seller or the Proposal Trustee may reasonably require to give effect to this Agreement or required by Applicable Law or any Governmental Authority.

 

6.3 Seller’s Deliveries on Closing

 

At or before the Time of Closing, the Seller will execute and deliver to the Buyer the following, each of which will be in form and substance satisfactory to the Buyer, acting reasonably:

 

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6.3.1 a bill of sale substantially in the form of Exhibit B attached hereto in connection with the Purchased Assets;

 

6.3.2 a bring down certificate dated the Closing Date confirming that all of the representations and warranties of the Seller contained in this Agreement are true as of the Closing Date, with the same effect as though made on and as of the Closing Date;

 

6.3.3 an acknowledgment dated the Closing Date confirming that each of the conditions precedent in Section 5.2 of this Agreement and the CUI Proposal have been fulfilled, performed or waived as of the Closing Date;

 

6.3.4 a copy of the issued and entered Approval and Vesting Order and the vesting certificate; and

 

6.3.5 any other documentation as is referred in this Agreement or as the Buyer may reasonably require to give effect to this Agreement.

 

6.4 Buyer’s Acknowledgment

 

The Buyer acknowledges that the Seller is selling its rights, benefits and interests in and to the Purchased Assets as authorized by the Approval and Vesting Order. The Buyer agrees to purchase and accept the rights, benefits and interests of the Seller in and to the Purchased Assets pursuant to and in accordance with the terms of this Agreement, the bill of sale and the Approval and Vesting Order.

 

6.5 Possession of Purchased Assets

 

The Seller shall remain in possession of the Purchased Assets until the Time of Closing. On Closing, the Buyer will take possession of the Purchased Assets where situate at the Time of Closing. The Buyer acknowledges that the Seller has no obligation to deliver physical possession of the Purchased Assets to the Buyer. In no event will the Purchased Assets be sold, assigned, transferred or set over to the Buyer until the Buyer has satisfied all delivery requirements outlined in Section 6.2.

 

6.6 Access to and Removal of Purchased Assets

 

6.6.1 The Buyer may have reasonable access to the Purchased Assets located at the Premises during normal business hours prior to the Time of Closing for the purpose of enabling the Buyer to conduct any inspections of the Purchased Assets as it deems appropriate. Those inspections will only be conducted in the presence of a representative of the Seller or the Proposal Trustee if so required at the discretion of the Seller.

 

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6.6.2 Each of the Buyer and CUI Global Inc. agrees to indemnify and save the Seller and the Proposal Trustee harmless from and against all claims, demands, losses, damages, actions and costs incurred or arising from or in any way directly related to the inspection of the Purchased Assets or the attendance of the Buyer, their respective employees, contractors or agents.

 

6.7 Risk

 

The Purchased Assets will be and remain at the risk of the Seller until Closing and at the risk of the Buyer from and after Closing. If, prior to Closing, the Purchased Assets are substantially damaged or destroyed by fire or other casualty, then, at its option, the Buyer may decline to complete the Transaction. This option will be exercised by way of written notification, in accordance with Section 8.6, within ten (10) days after notification to the Buyer by the Seller and the Proposal Trustee of the occurrence of damage or destruction (or prior to the Closing Date if such occurrence takes place within fifteen (15) days of the Closing Date) in which event this Agreement will be terminated automatically and the Buyer will be entitled only to a return of the Deposit paid under Section 2.6.1 but without any other compensation. If the Buyer does not exercise this option, it will complete the Transaction and will be entitled to an assignment of the proceeds of insurance referable to such damage or destruction. Where any damage or destruction is not substantial, as determined by the Seller in its sole opinion, acting reasonably, the Buyer will complete the Transaction and will be entitled to an assignment of the proceeds of insurance referable to such damage or destruction provided that such damage or destruction is insured or, otherwise, to an agreed abatement.

 

6.8 Termination

 

If either the Seller or the Buyer validly terminates this Agreement under the provisions of Sections 5.4 or 6.7:

 

6.8.1 all the obligations of both the Seller and Buyer under this Agreement will be at an end;

 

6.8.2 the Buyer shall be entitled to have the Deposit and all the monies paid hereunder to the Proposal Trustee returned; and

 

6.8.3 neither Party will have any right to specific performance or other remedy against, or any right to recover damages or expenses from, the other.

 

For certainty, in the event that the Seller or the Buyer terminates this Agreement under Section 5.4, the Buyer will not be entitled to have the Deposit returned and the Deposit and any interest thereon will be forfeited to the Seller, unless that termination results from the failure to satisfy the conditions under Sections 5.1 or 5.3.

 

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6.9 Breach by Buyer

 

If the Buyer fails to comply with the terms of this Agreement, the Seller may by notice to the Buyer elect to treat this Agreement as having been repudiated by the Buyer. In that event, the Deposit and any other payments made by the Buyer will be forfeited to the Seller on account of its liquidated damages, and the Purchased Assets may be resold by the Seller. In addition, the Buyer will pay to the Seller, on demand, the deficiency, if any, arising upon such resale (after deducting the Deposit, the Interest on the Deposit and the expenses of resale) together with interest and all other damages or charges occasioned by or resulting from the default by the Buyer.

 

Article 7

POST-CLOSING MATTERS

 

7.1 Reimbursement of Prepaid Expenses, Tax Refunds and Accounts Receivable

 

7.1.1 After the Time of Closing, if the Buyer receives any payments or amounts in respect of Accounts Receivable, Tax Refunds, Prepaid Expenses or accounts or monetary obligations owing to the Seller or a related party to the Seller, including any security for payments and all related agreements (whether or not such amounts are included in one of the attached Schedules hereto), arising prior to March 1, 2015, such payments and amounts shall be deemed to be held in trust on behalf of the Seller or related party to the Seller, as the case may be, and shall not form part of the Purchased Assets, and the Buyer shall immediately, or in any event no later than five (5) Business Days from receipt of such payments or amounts, endorse such payments or amounts to the Proposal Trustee.

 

7.1.2 After the Closing Date, the Buyer agrees to use all commercially reasonable efforts to collect, without remuneration or compensation, on behalf of the Seller or related party to the Seller any and all Accounts Receivable, and shall carry on the Business in the ordinary course for a period of at least twelve (12) months beginning after the Closing Date (the “ Collection Period ”). For greater certainty, the Buyer agrees that it will not take any actions or otherwise regarding the operations of the Business that would disrupt ordinary operations or negatively impact the ability of the Buyer to recover any amounts owing in respect of the Accounts Receivable, Tax Refunds, Prepaid Expenses or accounts or monetary obligations owing to the Seller or a related party to the Seller on behalf of the Seller. The Buyer shall not compromise any Accounts Receivable or Prepaid Expenses without the written consent of the Seller or the Proposal Trustee.

 

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7.1.3 The Buyer agrees that any payments received by the Buyer from customers from and after the Closing Date shall be applied first to satisfy and retire the Accounts Receivable. For greater certainty, until such time as the Accounts Receivable are paid in full, any and all payments received after the Closing Date by the Buyer from a customer shall be applied first to pay down the Account Receivable regardless of any agreement or arrangement as between the Buyer and the customer that would provide otherwise. The only exception to this provision is under circumstances wherein the customer has a commercially reasonable defense to payment of the Account Receivable(s). In that event, the Buyer agrees to consult with the Seller in order to determine the best course of action prior to taking any steps with respect to such Account Receivable(s), and the Seller shall be free to take whatever step are necessary to enforce such Account Receivable(s); provided that the Buyer, having consulted with the Seller, shall have no obligation to apply any further payments from said customer to the disputed amount unless and until such dispute is resolved.

 

7.1.4 After the Closing Date, the Buyer agrees to use all commercially reasonable efforts to utilize the benefit of any and all Prepaid Expenses relating to any and all goods ordered or shipped prior to March 1, 2015, and shall reimburse the Seller or a related party to the Seller, as applicable, by remitting payment to the Proposal Trustee in an amount equal to any such Prepaid Expenses within two (2) Business Days from the date the Buyer receives the benefit of such Prepaid Expenses; regardless of any arrangement or agreement as between the Buyer and the recipient and/or holder of such Prepaid Expenses.

 

7.1.5 After the Closing Date, the Buyer shall use all commercially reasonable efforts to provide to the Seller or the Proposal Trustee a statement, including copies of cheques, paper records, and other accompanying documents received from the account debtor or Governmental Authority, on a monthly basis, for a period of twelve (12) months beginning 30 days after the Closing Date, setting out any Accounts Receivable, Prepaid Expenses and Tax Refunds arising prior to March 1, 2015 that were collected or utilized, as the case may be, during each month for receipt by the Proposal Trustee no

 

later than the 15 th day of each month end, net of any deductions agreed to by the Parties in writing.

 

7.1.6 The Buyer agrees to use all commercially reasonable efforts to support and assist the Seller and/or any related party to the Seller, as necessary, with any of its post-Closing filings and/or audits related to or required by any Governmental Authority, including, but not limited to, making available to the Seller and/or any related party to the Seller, as the case may be, the requisite accounting records (whether in paper record form or otherwise) and Hired Employees to facilitate such efforts.

 

7.1.7 The Parties acknowledge that the Accounts Receivable have not been and are not being assigned to the Buyer, but the Buyer is acting as agent for the Seller in the collection of the Accounts Receivable.

 

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7.1.8 In the event that the Buyer fails or refuses to collect or remit, as the case may be, any Accounts Receivable, Tax Refunds, Prepaid Expenses or accounts or monetary obligations owing to the Seller in accordance with the terms herein, and such accounts are 60 days overdue or more, the Buyer agrees that the Seller and/or the Proposal Trustee shall be permitted to pursue such account debts on their own accord, and shall be entitled to collect such Accounts Receivable in the name of “Tectrol Inc.” until such time as the Accounts Receivable have been paid in full or otherwise agreed to in writing by the Seller.

 

7.2 Books and Records

 

The Buyer shall preserve and keep the Books and Records, including, but not limited to, any books and records relating to any affiliate, associate or related corporation to Seller, which relate to the Purchased Assets, the Excluded Assets or otherwise for a period of seven (7) years from the Closing Date or for any longer period as may be required by any applicable law or Governmental Authority; unless the Parties otherwise mutually agree in writing to purge or destroy any of the Books and Records or Confidential Information. Upon reasonable advance notice, after the Closing Date, the Buyer will grant the Seller and the Proposal Trustee, if necessary, and, in the event the Seller is adjudged bankrupt, any trustee of the estate of the Seller, reasonable access during normal business hours, and licence free of charge, to use the books, records and documentation included in the Purchased Assets up to the Closing Date, including, without limitation, any employment records, paper records, accounting records of the Business, the Hired Employees and the Union Employees relating to the period up to the Closing Date and any Employees engaged by the Seller at or in respect of the Purchased Assets up to and including the Closing Date, and computer systems, tapes, disks, records, paper records and software (including the SAP and accounting software programs) acquired as part of the Purchased Assets.

 

The Buyer agrees to notify the Seller and/or its representatives upon the discovery of any books and records, paper records, electronic records, financial and accounting information and records, personnel records, tax records or otherwise relating to any Person that is not the Seller, and to treat such information as Confidential Information. Upon a written request from the Seller, the Buyer agrees to provide any and all originals or copies of such information, as applicable, within two (2) Business Days of receipt by the Buyer of such request.

 

7.3 Hired Employees

 

Following the Time of Closing, the Buyer shall make available to the Seller and/or the Proposal Trustee, on a reasonable basis and during normal business hours, the Hired Employees as may be reasonably requested by the Seller or the Proposal Trustee from time to time as is needed to administer their respective duties in the Seller’s proceedings under the BIA provided that the provision of the Hired Employees as aforesaid does not cause unreasonable disruption to the Business operations of the Buyer.

 

The Buyer also agrees that it shall assist the Seller by designating or directing certain Hired Employees, as required, to assist with the collection, compiling and processing of the Accounts Receivable and Tax Refunds during the pendency of the Collection Period.

 

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7.4 Seller’s Name

 

Forthwith following Closing of the Transaction, the Seller shall discontinue use of the name “Tectrol Inc.”, except where legally required to identify the Seller until its name has been changed to another name or as contemplated in Subsection 7.1.8 herein. The Seller shall as soon as practical change the corporate name of the Seller to the numbered company name of the corporation comprising the Seller.

 

Article 8

GENERAL

 

8.1 Paramountcy

 

In the event of any conflict or inconsistency between the provisions of this Agreement, and any other agreement, document or instrument executed or delivered by the Seller in connection with this Transaction or this Agreement, the provisions of this Agreement will prevail to the extent of that conflict or inconsistency.

 

8.2 Commission

 

The Buyer acknowledges that there are no agent or broker fees or other commissions payable by the Seller on the Purchase Price or otherwise in connection with the Transaction, and the Buyer agrees to indemnify the Seller against any claim for compensation or commission by any third party or agent retained by the Buyer in connection with, or in contemplation of, the Transaction.

 

8.3 Confidentiality

 

All information exchanged between the Seller and the Buyer in connection with the Transaction will be considered Confidential Information. For certainty, the Confidentiality Agreement will continue to be in effect until Closing, except for such Confidential Information or other information relating to the Transaction that is required to be disclosed to obtain the Approval and Vesting Order. Any publicity relating to the Transaction and the manner of releasing any information regarding the Transaction will be mutually agreed upon by the Seller and the Buyer, both Parties acting reasonably.

 

8.4 Costs and Expenses

 

Except as otherwise specified in this Agreement, all costs and expenses (including the fees and disbursements of accountants, legal counsel and other professional advisers) incurred in connection with this Agreement and the completion of the Transaction are to be paid by the Party incurring those costs and expenses.

 

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8.5 Time of Essence

 

Time is of the essence in all respects of this Agreement.

 

8.6 Notices

 

Any Communication must be in writing and either:

 

8.6.1 personally delivered;

 

8.6.2 sent by prepaid registered mail; or

 

8.6.3 sent by facsimile, email or functionally equivalent electronic means of communication, charges (if any) prepaid.

 

Any Communication must be sent to the intended recipient at its address as follows:

 

to the Seller at:

 

Tectrol Inc.

550 Eglinton Ave. W. P.O. Box 23030

Toronto, Ontario

M5N 1B0

 

Attention: Richard Gelb
Email: Tectrol.richardgelb@gmail.com

 

with a copy to:

 

Borden Ladner Gervais LLP

Scotia Plaza Tower

40 King St. W, 44 th Floor

Toronto, Ontario

M5H 3Y4

 

Attention: Edmond Lamek Email:

elamek@blg.com

 

to the Buyer at:

 

CUI-Canada, Inc. c/o CUI, Inc.

20050 SW 112 th Avenue

Tualatin, Oregon 97062

USA

 

Agreement of Purchase and Sale

 

- 25 -
 

 

Attention: Matt McKenzie Email:

mmckenzie@cui.com

 

And to:

 

CUI Global Inc.

20050 SW 112 th Avenue

Tualatin, Oregon 97062

USA

 

 

Attention: William J. Clough, Esq Email:

wclough@cuiglobal.com

 

with copy to:

 

Aird & Berlis LLP

Brookfield Place

181 Bay Street

Toronto ON M5J 2T9

Canada

 

Attention: Harry Fogul
Email: hfogul@airdberlis.com

 

to the Proposal Trustee at:

 

Duff & Phelps Canada Restructuring Inc.

333 Bay Street, 14 th Floor

Toronto, Ontario

 M5H 2R2

 

Attention: Mitch Vininsky
Email: mitch.vininsky@duffandphelps.com

 

or at any other address that any Party may from time to time advise the other by Communication given in accordance with this Section 8.6. Any Communication delivered to the Party to whom it is addressed will be deemed to have been given and received on the day it is delivered at that Party’s address, provided that if that day is not a Business Day then the Communication will be deemed to have been given and received on the next Business Day. Any Communication transmitted by facsimile, PDF or other form of electronic communication will be deemed to have been given and received on the day on which it was transmitted (but if the Communication is transmitted on a day which is not a Business Day or after 3:00 p.m. (local time in the City of Toronto, Province of Ontario), the Communication will be deemed to have been received on the next Business Day). Any Communication given by registered mail will be deemed to have been received on the fifth (5 th ) Business Day after which it is so mailed. If a strike or lockout of postal employees is then in effect, or generally known to be impending, every Communication must be effected by personal delivery or by facsimile transmission, PDF or other form of electronic communication.

 

Agreement of Purchase and Sale

 

- 26 -
 

 

8.7 Further Assurances

 

Each Party will, at the requesting Party’s cost, execute and deliver all further agreements and documents and provide all further assurances as may be reasonably required by the other Party to give effect to this Agreement and, without limiting the generality of the foregoing, will do or cause to be done all acts and things, execute and deliver or cause to be executed and delivered all agreements and documents and provide all assurances, undertakings and information as may be required from time to time by all regulatory or governmental bodies.

 

8.8 Amendment and Waiver

 

No supplement, modification, amendment, waiver, discharge or termination of this Agreement is binding unless it is executed in writing by the Party to be bound. No waiver of, failure to exercise or delay in exercising, any provision of this Agreement constitutes a waiver of any other provision (whether or not similar) nor does such waiver constitute a continuing waiver unless otherwise expressly provided.

 

8.9 Submission to Jurisdiction

 

Without prejudice to the ability of any Party to enforce this Agreement in any other proper jurisdiction, each of the Parties irrevocably submits and attorns to the non-exclusive jurisdiction of the courts of the Province of Ontario to determine all issues, whether at law or in equity arising from this Agreement. To the extent permitted by applicable law, each of the Parties irrevocably waives any objection (including any claim of inconvenient forum) that it may now or hereafter have to the venue of any legal proceeding arising out of or relating to this Agreement in the courts of that Province or that the subject matter of this Agreement may not be enforced in the courts and irrevocably agrees not to seek, and waives any right to, judicial review by any court which may be called upon to enforce the judgment of the courts referred to in this Section 8.9, of the substantive merits of any such suit, action or proceeding. To the extent a Party has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) with respect to itself or its property, that Party irrevocably waives that immunity in respect of its obligations under this Agreement.

 

Agreement of Purchase and Sale

 

- 27 -
 

 

8.10 Assignment and Enurement

 

Neither this Agreement nor any right or obligation under this Agreement may be assigned by either Party without the prior consent of the other Party. This Agreement enures to the benefit of and is binding upon the Parties and their respective successors and permitted assigns.

 

8.11 Severability

 

Each provision of this Agreement is distinct and severable. If any provision of this Agreement, in whole or in part, is or becomes illegal, invalid or unenforceable in any jurisdiction by a court of competent jurisdiction, the illegality, invalidity or unenforceability of that provision will not affect: the legality, validity or enforceability of the remaining provisions of this Agreement; or the legality, validity or enforceability of that provision in any other jurisdiction.

 

8.12 Counterparts

 

This Agreement may be executed and delivered by the Parties in one or more counterparts, each of which will be an original, and each of which may be delivered by facsimile, e-mail or other functionally equivalent electronic means of transmission, and those counterparts will together constitute one and the same instrument.

 

[SIGNATURE PAGES FOLLOW]

 

Each of the Parties has executed and delivered this Agreement, as of the date noted at the beginning of the Agreement.

 

  TECTROL INC.
   
  Per  
    Name: Richard Gelb
    Title: President
   
  CUI-CANADA, INC.
   
  Per  
    Name: William J. Clough Title:  
    CEO

 

Agreement of Purchase and Sale

 

- 28 -
 

 

CUI GLOBAL INC. hereby acknowledges and accepts the foregoing terms and conditions as set out in this Agreement the at this 23 rd day of February, 2015.

 

  CUI GLOBAL INC.
   
  Per  
    Name: William J. Clough
    Title:  President & CEO

 

Agreement of Purchase and Sale

 

- 29 -
 

 

SCHEDULE 1

 

ASSUMED CONTRACTS [SECTION 1.1.6]

 

Schedule 1

Assumed Contracts

Customers

 

Customer Agreement
   
  Power Supply Assembly Purchased Agreement, Effective
22Cisco Systems International B.V.  
  Oct-2009
   
Enterasys Networks, Inc. Independent Contractor Agreement, 11th April 2005
(Extreme Networks)  
   
Harmonic Inc. Supply Agreement, 6th June 2008
   
Lucent Technologies Inc. OEM Purchase Agreement, Effective 1st October 2004
(Alcatel-Lucent)  
   
Nautel Limited Sales Agreement, Effective 5th December 2011
   
Nautel Limited Indemnity Agreement, 27th June 2014
   
Philips and Neusoft Medical Systems Co. Ltd. Purchase Contract,  May 22nd 2012
   
Pitney Bowes Memorandum of Understanding, Effective January 9, 2002
   
Pyxis Corporation Long Term Corporate Agreement, Effective March 2, 1999
(Pyxis to Cardinal Health, Effective 1/20/03)  
(Cardinal Health to CareFusion Corporation, Effective July 1, 2009)  
  CareFusion Kanban Terms (Tectrol P/N 1326C), 30-August2010
   
  Long Term Corporate Services Agreement bew Tectrol Inc.
Sun Microsystems / MaxStrat and MaxStrat Corporation,
  Effective 24th September 1998
   
  Amendment #1 to LTC Services Agreement betw Sun Microsystems, Inc. and Tectrol Inc., Effective April 18, 2000.
   
Zoll Medical Corporation Zoll Medical / Tectrol Sales Agreement, Effective July 15, 2003

 

Agreement of Purchase and Sale

 

 
 

  

Schedule 1

Assumed Contracts

Suppliers

 

Supplier Agreement
   
Avnet Electronics Marketing Vendor Managed Inventory Agreement, last signed Nov. 8, 2005
   
Elytone Electronics Co. Ltd. Safety Stock Program Agreement, Effective 28th Jan 2013
   
Fe-Tronic Manufacturing Co. Ltd. Safety Stock Program Agreement, 1-Jan-2013
   
Future Electronics Inc.

Bonded Inventory Management Program -

Memorandum of Understanding

   
MicroMex, Inc. Product Manufacturing Agreement, 6th August 2012
   
Arrow Electronic Canada Ltd. Business Requirement Detail, Feb 14, 2007 (unsigned)

  

 
 

 

SCHEDULE 2

 

EQUIPMENT [SECTION 1.1.23]

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
    SMT Line #1
     
1 1 Exerra Precision Printing Board Stencil Printer  Model EP-33, s/n 07G4-1068
     
2 1 Panasonic Model Panasert HDP3XL/2666 Glue Inserter, s/n 88D019688
     
3 1 Panasonic Model Panasert MV2FXL/2559MB  Pick & Palce Inserter, s/n 992X08561 c/w 150/300 Cartridge Loader (1999)
     
4 1 Crown Simplimatic Model 8010 Board Feeder,  Right to Left, s/n M016390
     
5 1 Pyramax BTU International Reflow Oven Model 100A, Right to Left, s/n TTOC-1C (2012)
     
6 1 Pneumatic Inserter, Palm Controller
     
7 315 Panasonic Cartridges Q-Type Inserter Feeders, 8MM-24MM Capacity
     
    SMT Line #2
     
8 1 Nutek Board Feeder Model NTM 220DSXL (2005)
     
9 1 Speedline MPM SP Exel Model AP/Excel Printer, s/n 10600 (2005)
     
10 1 Panasonic Glue Inserter Model HDP-V/NM-DAOSA, s/n 016D07709
     
11 3 Simplimatic 24" Transfer Conveyors
     
12 1 Panasonic Panasert Model MV2FXL/NM-2559NB, Pick & Place Inserter, s/n 89H00461 120 Cartridge Capacity (1989)
     
13 1 Panasonic Pick & Place Inserter Model IDBM133 NM-EJM7A - CM 602, s/n 72EV0055 160  Cartridge Capacity (2006)
     
14 1 Vitronics Model Unitherm SMR-800 Reflow Oven

 

Tectrol Inc. | August 2014

 

Agreement of Purchase and Sale

 

1
 

  

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
15 146 Hoover/Panasonic Feeder Cartridges 8MM-24MM Capacity
     
16 15 ASC International Cyber Optics Model LSM-LG Laser Microscope, s/n 10164
     
    Through Hole Line
     
17 1 Universal Sequencer Pick & Place Model Radial 88 Triple Span, s/n 48903189/10165316 c/w (60) Feeder Sequencor (2012) (2) Board Load & Unload s/n 48592707/1015276 & 48592707/10158730 (2011)
     
18 1 Universal Sequencer Pick & Place Model Raidal 5 2.5/5.0, s/n 6360D00428541624907, 40 Cartridge Sequencor (1995)
     
19 1 Universal LX Inserter, Dual Station, s/n 6295-27275-CDH1499
     
20 1 Universal X/4 Programmer Satellite Controller,  s/n 6893-27180-CME-1242
     
21 1 Sciencescope Model EM-BDT3, s/n S981369
     
22 2 Madell Model 8500 Heat Gun
     
23 2 Hako FM-202 Solder Station
     
24 1 Crown Simplimatic Board Feeder Loader Model 8130, s/n M015290
     
26 1 Panasonic Panasert AVK Inserter Model NM-2013, s/n 77A01368 (60) Cartridge Feeder 27
     
  20 Panasonic 4 Ribbon Capacity Feeders
     
28 1 Crown Simplimatic Model 8070 60" Board conveyor, s/n M01530
     
29 1 Panasonic Model Panasert RH Inserter, 62 Slot Capacity, s/n 2870100605
     
30 1 Contents of Stencil Racks, Aluminum Frames Work Boards, etc. c/w Storage Racks

 

Tectrol Inc. | August 2014

 

2
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
31 4 Metal 2 Dual Storage Cabinet w/Contents
     
32 65 Aluminum 4 Wheel Tray Board Storage Racks
     
33 1 Universal Sequencer Model 2596R-21900-CESH-1376
     
34 1 Autosplile F-Pin Inserter, s/n 000275
     
35 1 Denison Multipress Press Y-21E, s/n 5917
     
36 1 Denison Multipress Press, s/n 895241
     
37 1 AMP Pneumatic Inserter Model #453973-3-AM s/n 26512
     
38 1 Zierick Electronic Connection Faston Inserter Model 7000 #007-070
     
39 1 AMP Pneumatic Inserter Model 817017-4-A, s/n 130863
     
40 1 AMP Pneumatic Inserter Model 806992-1-D,  s/n 130757
     
41 1 Pneumatic Press w/Palm Controls
     
42 Lot Remaining Contents of Auto Insertion Area Tables, Chairs, Maintenance Equipment, etc.
     
    Warehouse Storage Parts Area
     
43 12 Sections Easy-Up Parts Shelving 10"w x 16' L
     
44 6 Cari-All 4 Wheel Chrome Board Tray Transfer Carts
     
45 21 Sections Easy Up Shelving 24" x 48" x 5 Shelf
     
46 53 Section Industrial Redi Pallet Racking 36" D x 9'W x 4 Shelf High c/w Mesh Decking
     
47 5 BT Hyd Pallet Trucks
     
48 1 BT Prime-Mover Side Loader Electric Forklift Model TRT-1000E  2000 lb Capacity, 216" Mast, 4534 Hrs, s/n 184151
     
49 165 Sections Easy-Up Shelving 18"W x 4' Long  

 

Tectrol Inc. | August 2014

 

3
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
50 1 Blue Giant Walk Behind Forklift Model P-150-25, 2200 lb, 150" Mast/Lift c/w Cargo Lift, s/n 9520143
     
51 1 Blue Giant Walk Behind Forklift Model P-150-20 , 2000 lb, 150" Mast/Lift c/w Cargo Lift,  s/n 932004
     
51A 10 Metal 4 Wheel Inventory Carts
     
52 1 Progar Manufacutring Caraboard Compactor
     
53 Lot Remaining Contents in Warehouse Area, Ladders, Tooling, Misc Equipment, etc.
     
    Solder Area 54
     
  500 Green Tray Storage Bins
     
55 1000 Back Tray Storage Bins
     
56 270 4 Wheel Tray Storage Racks, 8 Shelf Capacity
     
57 1 AMP Terminating Machine Model K, s/n 117907
     
58 1 AMP Terminating Press Model 565-435-5, s/n 29430
     
59 1 Molex Terminal Press Model 638008300, s/n 1038 (2000)
     
60 1 Variable Speed Rolling Press, 5" Cap.
     
61 1 Hughes Model HRW-250B, 250W Second Weld Power Supply c/w Hughes Spot Welder
     
62 1 Unitek Model 1-133-02 Second Weld Power Supply c/w Hughes Spot Welder
     
63 2 Groman Model 920A Toroid Windewr c/w DRO
     
64 1 Schleuniger Model PF2000 Feeder Uncoiler, Schleuniger Model Eco-Strip 9300, s/n 2754-2084
     
65 1

Schleuniger Model UC-3750 Cut To Length s/n 134

 

Tectrol Inc. | August 2014

 

4
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
66 1 Groman Simplex Bobbin Winder c/w DRO
     
67 1 General Pneumatics Air Dryer Model TKF325A-E6X #00BTKF011 (2000) c/w Storage Tank
     
68 1 Atlas Copco Air Dryer Model FD-80, s/n 950176
     
69 1 Atlas Copco Air Compressor Model GA-53, 75 HP, s/n AP1509680 (2006)
     
70 1 Atlas Copco Air Dryer Model GA37
     
71 1 Atlas Copco Air Dryer Model GA37 (1988), s/n ABP714866
     
72 1 Beko Water Separator
     
73 1 General Production Model CF-8 Component  Former, s/n 89411
     
74 1 General Production Model CF-10 Component Former, s/n N/A
     
75 1 General Production Model CF-9 Component Former, s/n 84010
     
76 1 General Production Model CF-9 Component Former, s/n 84010
     
77 2 Pneumatic Component Forming Presses
     
78 3 Pneumatic GDP Trim Formers Model TF-5150
     
79 3 Pneumatic Trim Formers
     
80 4 Pneumatic Up-Acting Rivet Inserter
     
81 3 Adams-Maxwell Model 1200-2C2 Winders w/Counting Head
     
82 26 Hako Solder Stations Model FM-202
     
83 13 Hios Model CLT-50 Power Supply Source

 

Tectrol Inc. | August 2014

 

5
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
84 4 Electric Precision Drills
     
85 8 Nasco 1kg Capacity Tool Drops
     
86 16 Metal Work Stations
     
87 1 Gen Rad Precision LC Digi Bridge w/Controller
     
88 1 Gen Rad 1689M RLC Digi Bridge, s/n 1689-9750-01
     
89 1 Hiptronics Model HD100 Hipot Tester, s/n 859-059
     
90 3 Hustler Pneumatic Winders
     
91 2 A & A Metal Products 2 Drawer Flammable Storage Cabinets
     
92 1 Blakeslee Single Station Wash Unit
     
93 1 Stationary Hot Melt Solder Pot
     
94 1 Everett Charles SMT Superkit c/w Fairchild Inspection Station
     
95 3 Cab Model Hector 2 Trim Station
     
96 1 Cab Model Maestro 2M Board Cutter, s/n 471
     
97 1 CTI Systems Circuit Board Router, Single Head Fujinon CST Camera (2011)
     
98 3 Hakko Solder Stations Model 472D 99      1
     
    Hakko Solder Stations Model 470B
     
100 7 Accum Solder Stations w/Vacuum Pump
     
101 1 Pemserter Model Series LT/4
     
102 1 Seho Powerwave Solder Flow Oven Model 8440-4.0F, s/n 10051272130 (2010)
     
103 1 Electrovert Solder Flow Oven Model Econopak Plus 400/F, s/n M096115092 (1996)

 

Tectrol Inc. | August 2014

 

6
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
104 1 Usi Ultra Sonic System Model Performa, s/n NA
     
105 3 Double Sided 50' Manual Board Insertion Line c/w Cabinets & Seating Stations
     
106 1 Nobles Floor Washer Model Speed Scrub Echo
     
    Impregnation Area
     
107 1 Blue M Oven c/w Stabletherm Controller POM586C, s/n NA
     
108 1 Blue M Oven c/w Stabletherm Controller POM586C, s/n P23-1385
     
109 4 Pressure Pots, Pneumatic Environment Testing
     
110 1 Bink Model 83-5307, 5 Gal Paint Pot
     
111 5 Waggo Model Inf-120P Solder Melt Pots w/Exhaust Pump
     
112 1 Wenesco Model Concept 1 Solder Melt Pot
     
113 19 Arbour Bench Type Press Unit Model 8
     
114 1 Wire Insertion/Trimmer Model A075
     
115 3 Chrome Rolling Metro/Carry All Racks
     
116 6 Asst Work Benches and Remaining Contents
     
  117 3     Chrome Rolling Metro/Carry All Racks
     
118 Lot Asst Work Benches and Remaining Contents
     
    Machine Shop
     
119 1 DI-Acro #2 Corner Tab Knotcher, s/n 2191
     
120 1 Di-Acro #2 Punch, s/n 3046
     
121 1 Strands Gear Head Dark Press Model S68, s/n 79840
     
122 1 Colchester Model Student 6" Engine Lathe 12" x 24" Bed

 

Tectrol Inc. | August 2014

 

7
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
123 1 Topwell Bridgeport Type Mill Model 3VK, 3 HP, s/n 781838 (1989)
     
124 1 Rockwell Model IS-601 Floor Type Drill Press #G3412 c/w Tapping Head
     
125 1 Almec 12" Disc Grinder, s/n 89154
     
126 1 Baldor 1/4 HP Buffer/Grinder
     
127 1 Freeport Model SGS 618B Surface Grinder, s/n 88H2B164 (1988)
     
128 1 ELU Cold Cut Metal Saw
     
129 1 DI-Arco Model 24 Box & Pan Brake, 24" Cap, s/n 5731
     
130 1 Calmec Model CBS-6 6" Belt Sander, s/n 88-02-4
     
131 1 Buffalo Model 18 Floor Type Drill Press
     
132 1 Single Bag Dust Collection System 1.6/1250
     
133 1 Edwards Model 1.6/1250MM Mini-shear 16 GA Capacity, s/n 787830482
     
134 1 Furo Metal Cutting Bandsaw Model BBS16 c/w Welder, s/n 160005
     
135 Lot Remaining Contents of Manintenance Shop, Tooling, Cabinets, Work Benches, Hand Tools, Aluminum Inventory, Racking etc.
     
    Assembly & Test Area
     
136 17 Hakko Solder Stations Model FM-202
     
137 9 HIOS Power Supply Model CLT-50
     
138 5 Hakko Solder Station Model 472D
     
139 2 Hakko Solder Station Model 470B
     
140 5 HP Model 6012A DC Powser Supply

 

Tectrol Inc. | August 2014

 

8
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

 

 

Ref # Qty. Description
     
141 14  Variable Speed Electric Drills
     
142 11 Powerstat Type 3 Power Supply
     
143 2 Nasco 1kg Tool Drop
     
144 12 GW/Instek Model PS-30 Lab Scope
     
145 2 HP Model 54600B Oscilloscope
     
146 25 Tectrol Dual Solid State Load Model TE-039B
     
147 1 Superior Electric Model 116C Variable Transformer
     
148 2 Kikusui Model PAO 55-35L DC Power Supply
     
149 2 Tektronicx Model TDS-2014B 4 Channel Slop
     
150 2 Tektronix Model TDS-3012B 2 Channel Color Slope
     
151 1 Xantrex Model XHR60-10 DC Power Supply
     
152 1 Xantrex Model XHR300-3.5 DC Power Supply
     
153 1 Phillips Model HDII Ult Sound Station, s/n US90530932
     
154 1 Phillips Model HDII Ult Sound Station, s/n  RDNO5HIPI
     
155 1 Phillips Model HDII Ult Sound Station, s/n NA
     
156 6 Renfrew Model Load-X Voltage Tasters
     
157 1 Xantrex Model XFR-6046 DC Power Supply
     
158 1 Harrison Model 6438B DC Power Supply
     
159 1 Gold Star Model DM-333 Tester/Meter
     
160 4 Agilent Multimeter Model U1242B
     
161 1 Quadtech Model Sentry 20/AC/DC Tester
     
162 2 Quadtech Model Sentry 30/AC/DC Tester
     
163 2 Quadtech Model Sentry 50+ Ground Band

 

Tectrol Inc. | August 2014

 

9
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
164 7 Tectrol Model TECTTEST 5 Automatic P/S Tester TE-808
     
165 1 Fluke Model PM3380A Auto Range Combiscope
     
166 1 Transistor Devise Model DLP 130-15-750A Tester
     
167 4 ECT/Fairchild Super Kit SMT Tester Model FT303S
     
168 9 ROHS Hand Scanners c/w Charge Station,
    Model  M7225-2600-10HD
     
169 5 Checksum Automated Electronic Test System
    c/w H&M Board Tester
     
170 1 Rod-L 25 Amp Ground Tester
     
171 1 Croma Model 63201 DC Electronice Load Tester
     
172 1 Croma Model 63203 DC Electronic Load Tester
     
173 1 Madell Solder Station Model 850D
     
174 2 Powerstat Superior Variable Auto Transformer
     
175 1 HP Model 54600B Oscilloscope
     
176 1 Agilent Model 34401A Digi Multi Meter
     
177 2 NH Research Model Power Test 8105i System, s/n 5536
     
178 1 Chroma Model 63106 DC Electric Load Tester #631-431-28
     
179 95 Metal Base Work Tables, Insulated top 5/8' W x 3'D
     
180 60 Metro Chrome 2 Shelf Rolling Racks
     
181 76 Metro Chrome Multi Shelf Rolling Racks

 

Tectrol Inc. | August 2014

 

10
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
182 50  Adjustable Steno Static Chairs
     
183 1 Vision Engineering Stereo Scope Model TS4 c/w
     
184 1 Stanford Model SR-720 LCR Motor
     
185 1 Valhalla Scientific Model 4300B Digital Micro Meter
     
186 1 Fluke Calibrator Model 5100B
     
187 1 OMAX Stereo Scope c/w Camera
     
188 1 Mitutoyo Digital Height Gauge 0" - 18" Capacity c/w Surface Block
     
189 2 2 Door Metal Cabinets c/w Contents, Measuring Precision Testing etc.
     
190 2 Xantrex Model XXFR 600-2 DC Power Supply
     
191 1 NHR Test System Model 5600 c/w Power Scope 4700 Load Testers, 5100 AC/DC Source & Keyboards, s/n S7669
     
192 1 Veltech Power Analyzer Model PM100
     
193 2 Tec Test Model 6A Testers
     
194 1 Vibco Vibration Test Table
     
195 1 ROD-L 25 Amp Ground Tester
     
196 1 Powerpak Compactor Model UB3624, s/n U2-1-9-12
     
197 1 Tenco Cardboard Compactor Model 5440
     
198 1 Pedestal Drill, Hood, Vacuum, Ladders, Misc.
     
199 1 Universal Handling Compactor Model UP2000, s/n 10-6-5-01
     
200 1 Custom Test Station c/w Keithloy Multimeter, Voltech Power Analyzer c/w Power Source

 

Tectrol Inc. | August 2014

 

11
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
201 1 Weigh-Tronix 2000 lb Digital Platform Scale
     
202 1 Contents of Mezzazine Area Including: Metal Shelving Racks, Misc Test Equipment, etc.
     
203 1 HI-Jacker 500 lb Telescoping Work Platform Electric Powered
     
204 13 Asst Metal Storage Cabinets c/w Asst Test Equipment & Fixtures
     
205 1 EZ Life Pallet Mover, Electric Power
     
206 1 Banding Strapping Machine c/w Crimper
     
207 1 Raymond Model 20R30TT, 3000 lb Reach Forklift, s/n #20-8024-S
     
208 22 PSC Power Scan Portable Scanners
     
209 1 5' Portable Warehouse Ladder
     
210 1 Instasheeter High Speed Bubble Wrap Converting System
     
    Maintenance Area
     
211 Lot Contents of Shop Area Including: Tool Chests, Repair Area, Bench Grinders, Shop Parts & Repair Parts, etc.
     
212 Lot Cafeteria Area Contents Including Tables, Chairs, (6) Microwave Ovens, Asst Metro Racks, etc.
     
213 1 DI-Acro Finger Brake, Model 3.6" s/n FB-7433
     
214 1 DI-Acro Angle Knotcher, s/n AB2921
     
215 1 Buffalo 15" Bench Drill
     
216 8 Sections EZ Rect Parts Shelving
     
217 1 600 lb Portable Scissor Lift
     
218 Lot Test Area Remaining Contents Including: Metal Storage Cabinets, Test Equipment & Test Fixtures etc.

 

Tectrol Inc. | August 2014

 

12
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
219 Lot Assembly & Test Area Remaining Contents Including: Test Fixtures, Tooling, Asst Cabinets, Computers, & Monitors, Test Benches, Power Cable, etc.
     
    Engineering Departments (Upper Floor)
     
220 7 Fluke Model Hydra Data Bucket/Scanner
     
221 1 Wavetek Model 171 Synthesizer/Function Generator
     
222 1 ES Stereo Microscope
     
223 15 Superior Powerstate Variable Speed Controller
     
224 6 Voltech Model PM 1000/300 Phase Power Analyzer
     
225 23 GW Instek Model PC3030 Dual Tracking Voltage Meter
     
226 7 Tektronix Model TDS3034B/3014 B 4 Channel Color Scopes
     
227 9 Transistor Devices Model DLP-130-15-750A/50-60 -1000
     
228 2 Xnatrex Model XFR60-40 DC Power Supply
     
229 40 Fluke Multi Meter Model 77/73 III
     
230 4 Chroma Model 63204/63203 D/C Electronic Load Tester, s/n 632040000323,  NA/632030001224, AKG00000068
     
231 30 Hakko Model FM202 Solder Station
     
232 22 Tectrol Model TL-039B Dual Load Tester
     
233 1 Keisoku Giken Model PT301B Power Supply Tester
     
234 2 Renfrew Power Supply Units
     
235 2 Elgar Model SW5550A High Power AC Source

 

Tectrol Inc. | August 2014

 

13
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
236 1 Kikisui Model PL2 664WA Electronic Load Tester
     
237 2 HP Model 6012A DC Power Supply
     
238 1 Instek Model PS2225 D/C Power Supply
     
239 8 Agilent Model 34970A Data Switch Unit
     
240 3 Chroma Model 63207 DC Electronic Load Tester
     
241 1 Xantrax Model XRF6040 DC Power Supply
     
242 2 Chroma Model 6314 DC Load Tester, 4 Cell & Main Frame, s/n 6314-2793, s/n 6314-2790
     
243 2 Superior Variable Auto Transformer
     
244 4 Tektronix Model TDS 3074 4 Channel Scope
     
245 5 HP Model 6050 Electronic Load Tester
     
246 1 Xantrax Model 6046 DC Power Supply
     
247 1 Wilde Model M3Z Stereo Microview Scope, Model MV-3271
     
248 1 Power Design Model TW6050A Dual DC Power Supply
     
249 1 Tenney Model T-JR Oven, s/n 11722-122
     
250 1 HP Model 6010A Electronic Load Tester
     
251 2 Scientific Atlanta Power VU-D9850 Program Receiver
     
252 2 Tektronix Model TDS2024B 4 Channel Color Scope
     
253 2 Xantrex Model XHR 300-3.5 Power Supply
     
254 2 Anritsu Model MS420K Spectrum Analyzer
     
255 1 Tecktronix Model TDS 754D 4 Channel Scope w/Cart

 

Tectrol Inc. | August 2014

 

14
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
256 1 Genrad Model 1659 RLL Digi-Bridge Test Unit
     
257 1 Sony-Tektronix Model 371 Hi-Power Curve Tracer w/Test Fixture
     
258 1 Hipotronics Model HD100 Hipot Tester
     
259 1 Fluke Model 8840A Multi-Meter
     
260 1 Omega Chart Recorder Model CT-485
     
261 4 Transistor Devices Model Dynaload DLVP/50-300-3000 Load Tester
     
262 1 Fluke Model 41B Power Analyzer
     
263 1 Venable Instruments Model 3120 Frequency Response Analyzer, s/n N/A
     
264 5 Superior Power Stat Variable Transformer
     
265 26 Work Station Units c/w Pedestal Drawer & Overhead Shelf Unit
     
266 Lot Contents of 2 Door Storage Locker Units Including: Asst Test Equipment, Jigs, Fixtures, etc.
     
267 1 HP Model 8560 Spectrum Analyzer
     
268 1 Line Impedance Stabilization Network
     
269 1 Transistor Dyna Load Model SEL Tester
     
270 8 Fluke Model PM3380A Auto Ranging Combi-Scope
     
271 1 Ling Model DCS8000 Vibration Controller
     
272 1 Dispatch Oven Model LBD1-34-43B-1
     
273 1 MB Model C10 Vibration Tester Type E, s/n 319 c/w Surface Block
     
274 1 Dynamotion Gas Detector Model 1001, s/n 432
     
275 1 Thermotron Model SM-16-3800 Test Chamber Oven, s/n 37094

 

Tectrol Inc. | August 2014

 

15
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
276 1 Transistor Devices Model DLP-5-2500A Load Tester
     
277 1 Screening Systems Model QRS-410T Screening System
     
278 1 Thermotron Model SM-8 Chamber Oven, s/n 32844
     
279 1 Tenney Test Chamber Model Versa-Tenn III Vibration Pads
     
280 1 Koytek Model EMC Chrome Advanced EMC Test Immunity System
     
281 1 General Pneumatics Airline Dryer
     
282 1 Stanley/Vidmar Multi Drawer Storage Cabinet
     
283 11 Chrome Metro Multi-Shore Rolling Racks
     
284 6 Speed Rail Multi-Shelf Parts Units
     
285 2 Hako FX-301 Hot Melt Pot w/Exhaust Head
     
286 1 Pneumatic Rivet Station L/Foot Operated Control
     
287 1 Aro Pneumatic Cutter
     
288 3 Adams-Maxwell Model 1200-JST Electric Winders w/Food Operated Control
     
289 1 Technology Model-875 Hot Strip
     
290 1 Heinrich Company Model 5 C-Press Units
     
291 3 Heinrich Company Model 0 C-Press Unit
     
292 31 Metal Base Work Tables w/Fitted Storage & Insulated Tops
     
293 1 Chamber Burn-In Area Contents
     
294 1 Chroma Model 6512 AC Programmable Source

 

Tectrol Inc. | August 2014

 

16
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
295 1 California Instruments AC Power Source Model 500lix
     
296 1 Test Equity Model 1027C Temperature Chamber, s/n 50549
     
297 2 Automatic P/S Test Modules Model TE-0888 Controller
     
298 1 TDK Lambada Power Source
     
299 2 HP Model 34401  Multi-Meter Tester
     
300 1 Kikusui Regulated DC Power Supply
     
301 1 Quad Tech Sentry 20 AC/DC Hipot Tester
     
302 1 Voltech Model PM100 Single Phase Power Analyzer
     
303 1 Fancort Industries Buaro Cutter Model NTG-4, s/n 1399R
     
303A Lot Remainig Contents of Engineering Area Including: Tooling, Electronic Test Equipment, Magna Lights, Shelving Units, Etc.
     
    Machine Shop Area (Upstairs)
     
304 1 Forward Machining Centre, Power Feed
     
305 1 Rockwell Model 5-30 Floor Type Drill Press, s/n 83G81501
     
306 1 Rockwell Model 15-240 Floor Type Drill Press, s/n 23047
     
307 1 DI-Arco Model 36 Metal Hand Shear, s/n EE-1443
     
308 1 Baldor Bench Grinder
     
309 1 Mini-Perf Pnematic Powered Punch
     
310 1 Starrett 12" x 20" Granite Surface Plate
     
311 1 Darbert 12" x 36" C.C. Engine Lathe (3JC)

 

Tectrol Inc. | August 2014

 

17
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
312 1 Mitutoyo 24" DRO Height Gauge
     
313 1 24" x 36" Granite Surface Plate
     
314 1 Lista 9 Drawer Storage Cabinet c/w Contents
     
315 1 LWH Pneumatic Powered Bench Press
     
316 1 Dake #1 Arbour Press
     
317 1 DI-Arco #1 Hand Punch, s/n  BA-2887
     
318 1 Beverly #B-2 Hand Metal Shear
     
319 1 HES Pneumatic Bench Type Punch
     
320 1 Rockwell 15-085 Floor Type Drill Press, s/n 203455
     
321 1 Jet Model VBS-2800 Metal Cutting Bandsaw
     
322 1 Dake Model Y Arbour Press
     
323 1 Brown Boggs Model 162-B Box & Pan Brake, s/n 81395
     
324 1 DI-Arco Model #1 Hand Corner Knotcher, s/n A6746
     
325 1 Baldor 4" Wide Vertical Belt Sander
     
326 1 Rimac Hand Tester
     
327 1 Remaining Contents of Machine Ship, Benches, Small Tooling etc.
     
328 1 Contents of Upstairs Office Area Furnishings
     
329 1 Unitdesign Model MDS-200 Frame Vacuum
     
330 Lot Contents of Room Including: Older Test Equipment & Storage Racks
     
331 1 Superior Variable Speed Power Unit
     
332 1 Voltech Model PM100 AC Power Analyzer

 

Tectrol Inc. | August 2014

 

18
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
333 2 HP 3585A Spectrum Analyzers
     
334 1 Hako Model 202 Solder Station
     
335 1 Instek Model PS-3030 DC Power Supply 336
     
  1 HP Model 6010A DC Power Supply
     
337 4 Workstations c/w Insulated Work Surface
     
338 1 Hammond 45 KVA Transformer
     
339 2 Metro Carts on Wheels
     
340 1  KLN Sonic Machine
     
341 1 Emhart Arcotronics Foil Machine c/w Controls Model PM-195, s/n 596A
     
342 1 Transistar Model DLVP 50-30-3000 Dynaload
     
343 1 HP Model 6012A DC Power Supply
     
344 1 HP Model 6814B AC Power Supply
     
345 1 HP Designjet 500 Printer
     
    Server Room
     
346 3 Dell Poweredge Model T710 Servers
     
347 5 ARC 1500 UPS
     
348 1 Remaining Contents in Server Room etc.
     
349 1 Xerox Model 3050 Wide Format Printer
     
350 1 Ricoh Aficio MP5001 Copier
     
351 10 Blue Print Storage Cabinet
     
352 1 ADP Time Clock
     
353 1 Ricoh Atico Model MP500088
     
354 1 Ricoh Aficio Model MP7001
     
355 1 Ricoh Aficio Model MP800 Copier

 

Tectrol Inc. | August 2014

 

19
 

 

 

Exhibit "A"

 

Tectrol Inc., 39 Kodiak Crescent, Toronto, Ontario

 

Ref # Qty. Description
     
356 1 Ricoh Aficio Model MP3001 Copier
     
357 1 Upstairs Boardroom c/w Benq Overhead Projector
     
358 1 Contents of Office Furnishings Located on Main Floor Office Area
     
360 Lot Assorted Scanners, Printers and Office Machines

 

Tectrol Inc. | August 2014

   

 
 

 

SCHEDULE 3

 

INVENTORY [SECTION 1.1.31]

 

Schedule 3

Inventory

Forecast February 28th balance using January roll forward

 

Opening - Jan 23             3,881  
Purchases             596  
Feb Sales     2,300          
COS     42.0 %        
Usage             975  
Closing - Feb 28             3,502  
                 
Closing - Feb 28             3,502  
Less: obsolete *1             (897 )
Subtotal             2,605  
Adjustments *2     8.9 %     232  
Goods in transit *3             63  
              2,900  
                 
November 30th "book value"             3,350  
                 
Closing Adjustment - increase (decrease)             (450 )

 

NOTES:

1 Obsolete as at Feb 15, 2015 determined using 24 historical sales + forecast
2 Adjusted based on percentage from November 30th methodology
3 Estimate

  

Agreement of Purchase and Sale

 

 
 

 

SCHEDULE 4

 

INTELLECTUAL PROPERTY [SECTION 1.1.30]

 

Schedule 4

Intellectual Property

 

Any documentation, information or material related to the Design and Manufacture of Switch Mode power supplies including, but not limited to: parts list, schematics, documents, drawings, and other knowhow

 

Phone Numbers

(416) 630-8108

 

Website Domains

tectrol-inc.ca 6/14/2021 DNS.INTERNIC.CA
tectrol-inc.com 6/15/2020 DNS.INTERNIC.CA
tectrol-inc.info 7/28/2020 DNS.INTERNIC.CA
tectrol-inc.net 6/15/2024 DNS.INTERNIC.CA
tectrol-inc.org 6/15/2022 DNS.INTERNIC.CA
tectrol-inc.us 3/25/2019 DNS.INTERNIC.CA
tectrol.biz 3/27/2021 DNS.INTERNIC.CA
tectrol.ca 12/21/2020 toroondcnszs04.srvr.bell.ca
tectrol.net 10/28/2022 DNS.INTERNIC.CA
tectrol.org 10/29/2021 DNS.INTERNIC.CA
tectrol.us 1/21/2021 DNS.INTERNIC.CA
tectrolinc.ca 6/14/2021 DNS.INTERNIC.CA
tectrolinc.com 6/15/2021 DNS.INTERNIC.CA
tectrolinc.info 7/13/2019 sp1.domainpeople.com
tectrolinc.net 6/15/2021 DNS.INTERNIC.CA
tectrolinc.org 6/15/2022 DNS.INTERNIC.CA
tectrolinc.us 3/25/2019 DNS.INTERNIC.CA
total-power-solutions.ca 6/14/2024 SEC1.DNS.CA.TELUS.COM
total-power-solutions.cn 3/27/2019 SEC1.DNS.CA.TELUS.COM
total-power-solutions.com 6/15/2020 toroondcnszs04.srvr.bell.ca
total-power-solutions.info 7/28/2021 DNS.INTERNIC.CA
total-power-solutions.net 6/15/2020 DNS.INTERNIC.CA
total-power-solutions.org 6/15/2021 DNS.INTERNIC.CA
total-power-solutions.us 3/25/2019 SEC1.DNS.CA.TELUS.COM
totalpowersolution.biz 10/3/2020 DNS.INTERNIC.CA
totalpowersolution.net 10/4/2020 DNS.INTERNIC.CA
totalpowersolution.org 10/4/2020 DNS.INTERNIC.CA
totalpowersolutions.ca 6/14/2022 DNS.INTERNIC.CA
totalpowersolutions.cn 3/27/2019 SEC1.DNS.CA.TELUS.COM
totalpowersolutions.com 4/7/2021 SEC1.DNS.CA.TELUS.COM
totalpowersolutions.info 7/28/2021 DNS.INTERNIC.CA
totalpowersolutions.net 6/15/2021 DNS.INTERNIC.CA
totalpowersolutions.org 6/15/2022 DNS.INTERNIC.CA
totalpowersolutions.us 1/21/2022 SEC1.DNS.CA.TELUS.COM
tectrol.asia 14/09/2015 ns1.eurodns.com
tectrol.sg 7/9/2017 ns1.eurodns.com
tectrol.hk 14/09/2016 ns1.eurodns.com
tectrol.be 14/09/2017 ns1.eurodns.com
tectrol.co.in 9/9/2016 ns1.eurodns.com
tectrol.net.cn 18/08/2020 ns1.eurodns.com
tectrol.mobi 16/09/2018 ns1.eurodns.com
totalpowersolutions.de 15/09/2016 ns1.eurodns.com
totalpowersolutions.tw 7/9/2017 ns1.eurodns.com
totalpowersolutions.be 15/09/2017 ns1.eurodns.com
totalpowersolutions.com.cn 18/08/2020 ns1.eurodns.com
totalpowersolutions.asia 17/09/2021 ns1.eurodns.com

 

Agreement of Purchase and Sale

 

 
 

 

Schedule 4

Intellectual Property

totalpowersolutions.in 10/9/2016 ns1.eurodns.com
totalpowersolutions.hk 17/09/2017 ns1.eurodns.com
tectrol.org.cn 6/7/2020 ns1.eurodns.com
total-power-solutions.co.uk 26/03/2017 ns1.eurodns.com
tectrol-inc.biz 11/18/2019 Under Construction Page
tectrol-inc.bz 1/30/2022 Under Construction Page
tectrol-inc.ws 1/30/2022 Under Construction Page
tectrol-inc.xyz 6/30/2015 ADNS Services
tectrol.bz 1/30/2022 Under Construction Page
tectrol.cn 3/14/2021 Under Construction Page
tectrol.cn.com 9/11/2018 Under Construction Page
tectrol.co 3/23/2016 Under Construction Page
tectrol.co.uk 3/14/2022 Under Construction Page
tectrol.com.cn 3/14/2021 Under Construction Page
tectrol.com.co 4/6/2021 Under Construction Page
tectrol.com.tw 3/14/2019 Under Construction Page
tectrol.eu 1/23/2017 sec1.dns.ca.telus.com|sec2.dns.ca.telus.com
tectrol.eu.com 10/31/2020 Under Construction Page
tectrol.in 9/11/2018 Under Construction Page
tectrol.info 1/23/2019 sec1.dns.ca.telus.com|sec2.dns.ca.telus.com
tectrol.jpn.com 3/31/2016 Under Construction Page
tectrol.kr.com 3/31/2020 Under Construction Page
tectrol.tw 3/14/2019 Under Construction Page
tectrol.uk.com 3/31/2016 Under Construction Page
tectrol.us.com 9/11/2018 Under Construction Page
tectrol.ws 1/30/2022 Under Construction Page
tectrolinc.biz 11/18/2019 Under Construction Page
tectrolinc.bz 1/30/2022 Under Construction Page
tectrolinc.co 4/6/2016 Under Construction Page
tectrolinc.ws 1/30/2022 Under Construction Page
tectrolinc.xxx 12/6/2017 Under Construction Page
total-power-solutions.asia 3/23/2021 Under Construction Page
total-power-solutions.biz 11/18/2021 sec1.dns.ca.telus.com|sec2.dns.ca.telus.com
total-power-solutions.bz 1/30/2022 Under Construction Page
total-power-solutions.co 3/23/2016 Under Construction Page
total-power-solutions.us.com 4/6/2021 Under Construction Page
total-power-solutions.ws 1/30/2022 Under Construction Page
totalpowersolutions.biz 11/18/2021 sec1.dns.ca.telus.com|sec2.dns.ca.telus.com
totalpowersolutions.bz 1/30/2022 Under Construction Page
totalpowersolutions.cn.com 8/12/2019 Under Construction Page
totalpowersolutions.co 3/23/2016 Under Construction Page
totalpowersolutions.co.uk 4/6/2021 Under Construction Page
totalpowersolutions.eu.com 8/12/2019 Under Construction Page
totalpowersolutions.net.cn 8/12/2017 Under Construction Page
totalpowersolutions.org.cn 8/12/2017 Under Construction Page
totalpowersolutions.uk.com 8/12/2017 Under Construction Page
totalpowersolutions.us.com 8/12/2019 Under Construction Page
totalpowersolutions.ws 1/30/2018 Under Construction Page
totalpowersolutions.xxx 12/6/2019 Under Construction Page

 

 
 

 

Schedule 4

Intellectual Property

Trade Marks

Trade-mark Country Registraton No. Registration Date Renewal Date
"TOTAL POWER SOLUTIONS" U.S. trade-mark 3,074,995   4-Apr-16
"TOTAL POWER SOLUTIONS" U.S. trade-mark 3,081,069 18-Apr-06 18-Apr-16
"TECTROL INC. & Design" - old logo U.S. Trade-Mark 3,033,314 27-Dec-05 27-Dec-15
Tectrol Design China 5198271 28-Oct-10 27-Oct-20
"TECTROL Design" China 5198272 7-Sep-09 6-Sep-19
"T TECTROL TOTAL POWER SOLUTIONS & Design" U.S.A. 3,350,000 4-Dec-07 4-Dec-17
"TECTROL" Canada TMA 530,983 10-Aug-00 Reg for 15 years
"TECTROL Design" Taiwan 1248330 16-Jan-07 15-Jan-17
"TECTROL Design" Hong Kong 300 584 550 20-Feb-06 19-Feb-16
"T & Design" Canada TMA 622,816 19-Oct-04 18-Oct-19
"TOTAL POWER SOLUTIONS" Canada TMA 593,439 29-Oct-03 28-Oct-18
"TECTROL & Design" Canada TMA 577,229 11-Mar-03 11-Mar-18
"TECTROL & Design" Canada TMA 579,842 28-Apr-03 27-Apr-18
"TECTROL INC. Design" - old logo Canada TMA 538,187 4-Dec-00 4-Dec-15
"TECTROL"   European Union 256 6933 8-Jul-03 4-Feb-12
"TECTROL & Device" European Union 256 6941 6-Jun-03 4-Feb-12

   

 
 

 

SCHEDULE 5

 

REQUIRED CONSENTS [SECTION 1.1.40]

 

 

Schedule 5

Required Consents

 

Not Applicable

  

Agreement of Purchase and Sale

 

 
 

 

SCHEDULE 6

 

ALLOCATION OF PURCHASE PRICE [SECTION 2.7]

   

SCHEDULE 6

 

PURCHASE PRICE ALLOCATION

 

Total Purchase Price:    
     
Purchase Price Adjustments:    
   
Net Purchase Price:    
     
Allocation  
   
Inventory:  
   
Fixed Assets:  
   
SAP:  
   
Intangibles:  
   
Other Assets:  

 

 
 

 

SCHEDULE 7

COPY OF EXECUTED CUI PROPOSAL [SECTION 1.1.19]

 

 

 

January 23 , 2015

 

Richard Gelb
TECTROL INC .

39 Kodiak Crescent
North York , ON Canada
MJ3 3E5

 

RE: PROPOSAL REGARDING ASSET PURCHASE OF TECTROL INC.

 

Dear Richard:

 

This Proposal ("PROPOSAL"), once executed, will serve to confirm the intent of CUI Global Inc. , a Colorado Corporation with its principal place of business at 20050 SW 1 12 1 Avenue , Tualatin, OR 97209 (hereinafter: "CUI"), to purchase the assets of Tectrol Inc . (hereinafter: " Tectrol " ) under the following terms and conditions and upon completion of the necessary conditions precedent. It is the intent of the Parties to complete and execute a formal, written Asset Purchase Agreement(s) to memorialize the relationship once an agreement-to-terms is reached. That being said, the proposed conditions and terms are as follows:

 

WHEREAS Tectrol is currently insolvent as that term is used in Canadian law and has filed a Notice of Intention to Make a Proposal ("NOI") on November 6 , 2014 under Section 50.4 (I ) of the Bankruptcy and Insolvency Act, R.S.C. 1985 , c. B-3, as amended;

 

WHEREAS pursuant to the terms of that NOI, Tectrol's principals and creditor(s) wish to sell Tectrol's assets and CUI wishes to purchase those assets;

 

WHEREAS CUI is prepared and able to provide funds (all amounts of which are in US dollars) and other consideration for the purchase of Tectrol's assets under the terms of this PROPOSAL , without a "financing contingency," if accepted, once the described conditions precedent are fulfilled or waived;

 

CUI Hereby sets forth its offer as follows

 

I) CUI shall pay as consideration the total amount of FIVE MILLION FIVE HUNDRED THOUSAND DOLLARS ($5,500,000.00) to be paid as follows:

 

a) A deposit of FIVE HUNDRED AND FIFTY THOUSAND DOLLARS ($550,000.00) as set out in paragraph 2(a) herein;

 

b) CUI shall pay on closing the sum of THREE MILLION FOUR HUNDRED AND FIFTY THOUSAND DOLLARS ($3,450,000.00) for the purchase of Tectrol ' s inventory, fixed assets (including SAP), goodwill and intangible assets, and like material;

 

i) The above sum to be adjusted in good faith by the Parties according to the final value of the non-obsolete inventory if said inventory's value moves (whether up or down) more than $50,000;

 

20050 SW 112th Avenue · Tualatin, Oregon 97062

 

 
 

  

 

c) CUI shall place an additional ONE MILLION TWO HUNDRED THOUSAND DOLLARS ($1,200,000.00) to be adequately secured or placed in an escrow with the Trustee to be paid, without conditions, over the course of twelve (12) consecutive months in twelve (12) equal installments of ONE HUNDRED THOUSAND DOLLARS ($100,000.00) on the first of each month following the close of the transaction;

 

d) CUI shall pay a Royalty Rate of two percent (2%) of the gross sales related to specific Tectrol customers (to be mutual ly agreed by the Parties hereto), up to a total of an additional THREE HUNDRED THOUSAND DOLLARS ($300,000.00).

 

i) In addition, CUI is prepared to enter into a five (5) year commercial lease agreement for the facility located at 39 Kodiak Crescent at reasonable market rates for comparable property similarly situated;

 

i i) Said market rate shall be set by an independent appraisal conducted by a mutually agreeable appraiser.

 

2) "Good Faith" Deposit:

 

a) A deposit of FIVE HUNDRED AND FIFTY THOUSAND DOLLARS ($550,000.00) or 10% of the proposed purchase price shall be forwarded to the Trustee as a "good faith deposit." It is specifically understood that acceptance and retention of this deposit is conditioned on completion and/or waiver of each and every one of the below Conditions Precedent, including, but not limited to CUI obtaining approval of the transaction from its Board of Directors. Should any of those Conditions Precedent be breached; in the unlikely event that CUI is unable to obtain approval from its Board of Directors; or should Tectrol accept a competitive bid or otherwise fail to consummate the transaction for any reason, this deposit shall be promptly and fully returned to CUI. The deposit (together with interest earned thereon) will be held by the Trustee in trust and will be credited to the purchase price on closing .

 

3) Conditions Precedent:

 

a) In order to consummate the transaction , the following events and/or acts must be completed:

 

i) CUI must be given the information and opportunity to conduct due diligence to confirm that the Customer List provided by Tectrol is accurate and still viable . For its part, CUI shall make such inquiry as soon as practical, but in no event more than thirty (30) days after acceptance of this PROPOSAL;

 

ii) ) Tectrol shall promptly provide CUI with all relevant corporate financial data in Tectrol's possession, including without limitation, the most recent three (3) years' audited (under Canadian GAAP) financial statements (the "Tectrol Financial Statements"). Tectrol shall begin working with an accounting firm (the "Firm") to be selected by CUI: (i) to commence the process having the Tectrol Financial Statements converted from Canadian GAAP to US GAAP, and to (ii) to provide the Firm with the information (to the extent available up to the Business Day before the Closing Date) necessary for the Purchaser to report on the current year and/or period ending at the Closing Date in accordance with US GAAP (i and ii collectively, "US GAAP Reporting"). CUI shall bear the cost of all US GAAP Reporting. It is specifically understood that the US GAAP Reporting process is unlikely to be completed prior to the Closing Date , and its completion is NOT a condition precedent to Closing.

 

20050 SW 112th Avenue ·Tualatin, Oregon 97062

 

 
 

 

 

iii) A full physical inventory shall be conducted as of the close of business prior to the closing of the transaction, to be observed by representatives appointed by CUI and basic audit procedures to substantiate the accuracy of inventory values shall be conducted;

 

iv) Tectrol shall provide confirmation that the fixed assets listing is accurate and the assets contained therein are in its possession, in good working order, and free and clear of any encumbrances;

 

v) CUI shall attempt to acquire assurances from "key employees" of their intent to remain with the company and Tectrol shall assist in those efforts, by both identifying and providing access to those "key employees";

 

vi) The SAP software program and licenses shall be transferred to Tectrol and included in the purchase;

 

vii) The lease of the facility at 401 Magnetic Drive shall be terminated by Tectrol i n advance of the purchase by CUI and all costs therein bourn by Tectrol;

 

viii) Tectrol shall certify that, in accordance with the terms and conditions of the 39 Kodiak Crescent lease, that maintenance and upkeep of the facility, as well as all taxes and other fees have been appropriately kept current by Tectrol ;

 

ix) Acquisition shall become effective on or before March 1, 2015, subject to completion of due diligence;

 

x) The Parties shall enter into a five (5) year commercially reasonable , market rate lease for the property located at 39 Kodiak Crescent and currently used by Tectrol to conduct its business;

 

xi) The Trustee shall obtain an Order from the Ontario Superior Court of Justice (Commercial List) approving the transaction and vesting all right, title and interest of the purchased assets to CUI free and clear of all encumbrances.

 

4) Miscellaneous

 

a) Independent Contractor Status - The relationship between the Parties will at all times be and remain that of independent contractors and nothing herein nor in the performance of this PROPOSAL will be deemed to create any partnership, joint venture, agency, fiduciary or employment relationship between the Parties.

 

b) Governing Law - This PROPOSAL is governed by, and is to be construed and interpreted in accordance with, the laws of the Province of Ontario and the laws of Canada applicable in that Province.

 

c) Partial Invalidity

 

i) Nothing contained in this PROPOSAL will be construed to require the commission of any act contrary to law, and wherever there is any conflict between any provision of this PROPOSAL and any statute, law , ordinance , order, or regulation, the latter will prevail, but in such an event, any provision of this PROPOSAL so affected will be curtailed and limited on ly to the extent necessary to bring it within the legal requirements.

 

ii) In the event any portion of the terms and conditions contained within this PROPOSAL will be held to be invalid or unenforceable in a court of law or equity; l) the Parties agree to negotiate in good faith an acceptable alternative provision which reflects as closely as possible the intent of the unenforceable provision, and 2) the validity, legality and enforceability of the remaining provisions of the PROPOSAL will not in any way be affected or impaired by such holding, and will remain in full force and effect.

 

20050 SW 112th Avenue · Tualatin, Oregon 97062

 

 
 

 

  

d) No Waiver - The failure of a performing party to insist upon the other party's performance of any representation , warranty , covenant or obligations hereunder will not be construed as a waiver by the performing party of such performance or other obligation due by the other party hereunder , or of any subsequent breach by such other party . The failure of either party to exercise any right or remedy which it may have hereunder or under law will not be construed as a waiver of any other right or remedy which the party may have hereunder or under law.

 

e) Cumulative Remedies - Each right and remedy conferred upon either party by this Agreement or under law will be deemed cumulative and not exclusive of one another, and the exercise by either party of any such right or remedy will not preclude the party exercising the right or remedy from exercising or enforcing any other right or remedy it may have hereunder or under law.

 

f) Legal Fees - In the event of any suit or other proceeding between the parties arising out of the performance, breach , default, termination or other subject matter of this Agreement , the prevailing party will, in addition to such other relief as the court may order or award , be entitled to recover actual legal fees , expenses and costs (including, but not limited to , court costs and costs of investigation) all as actually incurred .

 

g) Entire Agreement - This PROPOSAL contains the entire understanding of the Parties with respect to the subject matter dealt with herein and will supersede and replace in their entirety any and all prior understandings of the parties hereto relating to such subject matters . This PROPOSAL may not be modified , nor may any provision hereof be waived, except by a writing signed by both parties.

 

h) Headings - Paragraph headings used herein are for convenience only and will not be used in any way to interpret the provisions of this PROPOSAL.

 

i) The Parties s hall work towards the execution of an Agreement of Purchase and Sale on or before January 29, 201 5.

 

Signature Page Follows

 

20050 SW 112th Avenue ·Tualatin, Oregon 97062

 

 
 

 

 

This document consists of five (5) pages [including signature page]. If the foregoing reflects the PROPOSAL and proposed agreements between CUI and Tectrol, please sign the two (2) originals provided and return one to me by messenger or overnight mail.

 

Very truly yours,  
   
   
William J. Clough, Esq.  
President & CEO  
CUI Global Inc.  

 

AGREED TO AND ACCEPTED:  
     
Richard Gelb and Tectrol, Inc.  
     
By: Richard Gelb  
     
Title: President & CEO   
     
Date:    

 

20050 SW 112th Avenue · Tualatin, Oregon 97062

 

 
 

 

SCHEDULE 8

INVENTORY VALUATION METHODOLOGY [SECTION 1.1.32]

 

Schedule 8

 

Inventory Valuation Methodology

  

          Adjustments  
    Notes     Balance
Nov 30, 2014 		    PPV
(1) 		    Duty &
Freight
(2) 		    Overhead
%%% (3) 		    Overhead
$$$ (3) 		    Total Adj     Estimated
Inventory
at Cost 		 
                                                 
Semi Finished Goods - Buy             366,298                                                  
Obsolete Inventory             (900,000 )                                                
                                                                 
NET     1,2       1,852,688                                                  
                                                                 
Raw Materials                     1.2 %     5.0 %                                
Raw Materials             2,386,390                                                  
                      22,232       92,634                       114,867       1,967,555  
WIP                                                                
Semi Finished Goods - Make (WIP)     1,2,3       329,103       3,949       16,455       3.0 %     9,873       30,278       359,381  
Work In Progress     1,2,3       251,714       3,021       12,586       6.0 %     15,103       30,709       282,423  
Inventory - Finished Goods     1,2,3       641,523       7,698       32,076       9.0 %     57,737       97,511       739,034  
Goods In Transit                                                             TBD  
                                                                 
              3,075,028       36,900       153,751               82,713       273,365       3,348,393  
                                                      8.9 %        

 

NOTES:

 

Inventory Valuation - Active Items

 

Analysis to be performed on closing Inventory to determine Active and Inactive Inventory (same as analysis on November 21, 2014) Active Inventory to be defined as inventory related to items which have sold over the past 24 months or have future orders on hand. Inactive Inventory (Approx. $900K on November 21, 2014) will not be valued.

Note: Foreign Exchange not accounted for as this amount is not material to the reconciliation

 

Accounting Adjustments:

 

1 PPV to be based on YTD PPV (i.e. 10 months March to December 31). Currently estimated at 1.2%, but will be analyzed to confirm this rate.

2 Duty & Freight - Tectrol has historically used 5% to reflect the cost of these charges. Applied 100% to RM and Semi-Finished goods purchased; and to the material portion of WIP & FG
3 Overhead - Tectrol applies an overhead factor to the labour component of WIP and FG. These percentages pertain to the O/H rate for November 30th.

 

 
 

 

SCHEDULE 9

PREPAID EXPENSES [SECTION 1.1.25.3]

 

Schedule 9    
Prepaid Expenses    
Supplier Payments - CAD    
  Total CDN 6,449

 

Vendor     Clearing     Wire Payment             Open  
No   Vendor Name   Document     Amount     Currenc   Cleared     balance  
10012   ADTOOL CORPORATION     1500001516       175     CAD     48       127  
10021   AIM METALS     1500001795       1,394     CAD     1,394       -  
10191   IMPULSE TECHNOLOGIES LTD.     1500001748       2,592     CAD     2,592       -  
10550   RUSH PALLETS     1500001774       445     CAD     445       -  
10345   TRADEPORT ELECTRONICS GR     1500001793       3,112     CAD             3,112  
10345   TRADEPORT ELECTRONICS GR     1500001649       2,718     CAD     2,537       181  
10550   RUSH PALLETS     1500001844       347     CAD             347  
10482   ELECTRONIC COATING     1500001845       2,682     CAD             2,682  
                                      -  
                                      -  
                                      -  

 

 
 

 

Schedule 9    
Prepaid Expenses    
Supplier Payments - USD    
  Total USD 860,973

 

              Wire                        
Vendor       Clearing     Payment                        
No   Vendor Name   Document     Amount     Currency     Cleared     Open balance     Locale
20004   ACE TECH CORPORATION     1500001686       8,371       USD               8,371     NA
20010   ALEX CONNECTOR CO., LTD.     1500001741       5,908       USD               5,908     CN
20021   ARROW ELECTRONICS CANADA     1500001805       524       USD               524     NA
20021   ARROW ELECTRONICS CANADA     1500001810       2,559       USD               2,559     NA
20021   ARROW ELECTRONICS CANADA     1500001829       27       USD               27     NA
20021   ARROW ELECTRONICS CANADA     1500001841       540       USD               540     NA
20021   ARROW ELECTRONICS CANADA     1500001543       9,560       USD       9,135       425     NA
20021   ARROW ELECTRONICS CANADA     1500001558       10,426       USD       10,361       65     NA
20021   ARROW ELECTRONICS CANADA     1500001598       5,052       USD       5,028       24     NA
20021   ARROW ELECTRONICS CANADA     1500001622       10,523       USD       10,187       336     NA
20021   ARROW ELECTRONICS CANADA     1500001733       799       USD               799     NA
20021   ARROW ELECTRONICS CANADA     1500001846       317       USD               317     NA
20028   AVC AMERICA, INC     1500001782       2,385       USD               2,385     CN
20028   AVC AMERICA, INC     1500001623       5,247       USD               5,247     CN
20029   AVNET ELECTRONICS     1500001714       12,032       USD               12,032     NA
20029   AVNET ELECTRONICS     1500001749       10,868       USD               10,868     NA
20042   BROADLAKE CO., LTD.     1500001839       20,775       USD               20,775     CN
20042   BROADLAKE CO., LTD.     1500001796       17,236       USD               17,236     CN
20042   BROADLAKE CO., LTD.     1500001814       10,930       USD               10,930     CN
20042   BROADLAKE CO., LTD.     1500001483       7,045       USD       2,488       4,557     CN
20042   BROADLAKE CO., LTD.     1500001578       16,360       USD       10,889       5,471     CN
20042   BROADLAKE CO., LTD.     1500001752       12,966       USD       352       12,614     CN
20042   BROADLAKE CO., LTD.     1500001766       1,600       USD               1,600     CN
20047   CARLI ELECTRONICS CO. LTD     1500001588       1,079       USD               1,079     CN
20047   CARLI ELECTRONICS CO. LTD     1500001687       1,079       USD               1,079     CN
20055   CIT RELAY & SWITCH     1500001832       409       USD               409     NA
20055   CIT RELAY & SWITCH     1500001755       2,500       USD       1,000       1,500     NA
20063   CREATIVE CIRCUITS     1500001783       3,172       USD       3,172       -     NA
20063   CREATIVE CIRCUITS     1500001817       1,777       USD       1,504       273     NA
20070   DIGI-KEY CORPORATION     1500001691       3,495       USD       2,971       524     NA
20070   DIGI-KEY CORPORATION     1500001707       260       USD       130       130     NA
20430   Digital Printed Circuit Board Co.,L     1500001828       29,535       USD               29,535     CN
20430   Digital Printed Circuit Board Co.,L     1500001695       26,924       USD               26,924     CN
20071   DIVERSE ELECTRONICS INC.     1500001819       5,189       USD               5,189     NA
20071   DIVERSE ELECTRONICS INC.     1500001621       14,455       USD       13,359       1,096     NA
20071   DIVERSE ELECTRONICS INC.     1500001712       2,811       USD       1,070       1,741     NA
20071   DIVERSE ELECTRONICS INC.     1500001762       2,418       USD       1,131       1,287     NA
20078   ELECTRI-CORD MANUFACTURIN     1500001735       540       USD       540       -     NA
20082   ELNA AMERICA INC.     1500001842       312       USD               312     NA
20082   ELNA AMERICA INC.     1500001754       3,492       USD               3,492     NA
20083   ELNA MAGNETICS     1500001639       1,259       USD               1,259     NA
20084   ELYTONE ELECTRONICS     1500001807       2,850       USD               2,850     CN
20084   ELYTONE ELECTRONICS     1500001490       20,305       USD       7,108       13,197     CN
20084   ELYTONE ELECTRONICS     1500001525       525       USD       125       400     CN
20084   ELYTONE ELECTRONICS     1500001607       5,078       USD       188       4,890     CN
20084   ELYTONE ELECTRONICS     1500001640       264       USD               264     CN
20084   ELYTONE ELECTRONICS     1500001694       46,232       USD               46,232     CN
20084   ELYTONE ELECTRONICS     1500001751       29,215       USD               29,215     CN
20084   ELYTONE ELECTRONICS     1500001761       1,301       USD       188       1,113     CN
20097   FE-TRONIC MANUFACTURING     1500001590       8,364       USD       8,364       -     CN
20097   FE-TRONIC MANUFACTURING     1500001739       10,288       USD       447       9,841     CN
20097   FE-TRONIC MANUFACTURING     1500001826       25,626       USD               25,626     CN
20103   FUTURE ELECTRONICS (CDA), LTD     1500001792       542       USD       542       -     NA
20103   FUTURE ELECTRONICS (CDA), LTD     1500001804       271       USD       271       -     NA
20103   FUTURE ELECTRONICS (CDA), LTD     1500001813       4,715       USD       4,502       NA      
20103   FUTURE ELECTRONICS (CDA), LTD     1500001823       721       USD               NA      
20103   FUTURE ELECTRONICS (CDA), LTD     1500001681       4,469       USD       3,966       NA      

 

 
 

 

Schedule 9    
Prepaid Expenses    
Supplier Payments - USD    
  Total USD 860,973

 

              Wire                      
Vendor       Clearing     Payment                      
No   Vendor Name   Document     Amount     Currency   Cleared     Open balance     Locale
20103   FUTURE ELECTRONICS (CDA), LTD     1500001688       655     USD     601       55     NA
20103   FUTURE ELECTRONICS (CDA), LTD     1500001699       4,440     USD     3,223       1,217     NA
20103   FUTURE ELECTRONICS (CDA), LTD     1500001724       3,133     USD     3,133       -     NA
20103   FUTURE ELECTRONICS (CDA), LTD     1500001729       17,472     USD     10,844       6,628     NA
20103   FUTURE ELECTRONICS (CDA), LTD     1500001770       1,280     USD     1,280       -     NA
20103   FUTURE ELECTRONICS (CDA), LTD     1500001848       1,341     USD             1,341     NA
20501   Grandway Metal Manufacturing LTD.     1500001808       2,970     USD             2,970     CN
20501   Grandway Metal Manufacturing LTD.     1500001811       2,770     USD             2,770     CN
20501   Grandway Metal Manufacturing LTD.     1500001608       17,943     USD             17,943     CN
20501   Grandway Metal Manufacturing LTD.     1500001654       5,664     USD             5,664     CN
20501   Grandway Metal Manufacturing LTD.     1500001750       1,056     USD             1,056     CN
20072   HENGDIAN GROUP DMEGC     1500001647       650     USD     650       -     CN
20122   HITACHI CHEMICAL     1500001786       12,896     USD     12,896       -     NA
20122   HITACHI CHEMICAL     1500001809       2,400     USD             2,400     NA
20137   JIANGMEN GLORY FAITH PCB CO.     1500001736       2,167     USD     2,167       -     CN
20432   KAIMEI ELECTRONIC CORP.     1500001641       574     USD             574     CN
20432   KAIMEI ELECTRONIC CORP.     1500001683       1,148     USD             1,148     CN
20432   KAIMEI ELECTRONIC CORP.     1500001760       122     USD             122     CN
20159   MARIAN (SUZHOU) CO. LTD.     1500001779       270     USD             270     CN
20159   MARIAN (SUZHOU) CO. LTD.     1500001798       1,640     USD             1,640     CN
20159   MARIAN (SUZHOU) CO. LTD.     1500001818       1,156     USD             1,156     CN
20159   MARIAN (SUZHOU) CO. LTD.     1500001827       1,875     USD             1,875     CN
20159   MARIAN (SUZHOU) CO. LTD.     1500001764       153     USD             153     CN
20163   MECTECH COMPONENTS     1500001791       15,090     USD             15,090     NA
20163   MECTECH COMPONENTS     1500001803       5,933     USD             5,933     NA
20163   MECTECH COMPONENTS     1500001606       10,068     USD             10,068     NA
20163   MECTECH COMPONENTS     1500001642       7,000     USD             7,000     NA
20163   MECTECH COMPONENTS     1500001705       5,594     USD             5,594     NA
20173   MICROCHIP TECHNOLOGY INC.     1500001802       4,332     USD             4,332     NA
20173   MICROCHIP TECHNOLOGY INC.     1500001771       4,352     USD             4,352     NA
20174   MICROMEX, INCORPORATED     1500001790       1,643     USD     1,643       -     NA
20174   MICROMEX, INCORPORATED     1500001615       2,419     USD     2,419       -     NA
20174   MICROMEX, INCORPORATED     1500001631       579     USD             579     NA
20178   MOUSER ELECTRONICS, INC.     1500001789       306     USD     152       154     NA
20178   MOUSER ELECTRONICS, INC.     1500001646       269     USD     185       85     NA
20178   MOUSER ELECTRONICS, INC.     1500001738       436     USD     436       -     NA
20178   MOUSER ELECTRONICS, INC.     1500001768       65     USD     65       -     NA
20178   MOUSER ELECTRONICS, INC.     1500001847       818     USD             818     NA
20197   PANASONIC CANADA INC     1500001723       6,255     USD             6,255     NA
20205   POSITRONICS     1500001815       12,555     USD             12,555     NA
20206   POSITRONICS     1500001824       12,600     USD     12,600       -     FR
20390   SAGER ELECTRONICS     1500001788       23,702     USD             23,702     NA
20234   SAMXON ELECTRONIC COMPONEN     1500001812       3,372     USD             3,372     CN
20234   SAMXON ELECTRONIC COMPONEN     1500001545       7,828     USD     1,846       5,982     CN
20236   SANYO DENKI AMERICA, INC.     1500001822       5,840     USD             5,840     NA
20236   SANYO DENKI AMERICA, INC.     1500001730       2,920     USD             2,920     NA
20241   SEASON COMPONENTS CO. LTD     1500001799       79,814     USD             79,814     CN
20241   SEASON COMPONENTS CO. LTD     1500001511       2,544     USD             2,544     CN
20241   SEASON COMPONENTS CO. LTD     1500001528       7,633     USD             7,633     CN
20241   SEASON COMPONENTS CO. LTD     1500001679       3,000     USD             3,000     CN
20241   SEASON COMPONENTS CO. LTD     1500001697       312     USD             312     CN
20241   SEASON COMPONENTS CO. LTD     1500001740       6,383     USD     1,609       4,774     CN
20245   SEMICON ELECTRONICS LTD.     1500001617       1,302     USD             1,302     NA
20245   SEMICON ELECTRONICS LTD.     1500001716       1,302     USD             1,302     NA
20248   SHIN MUN CO LTD     1500001773       8,393     USD             8,393     CN
20248   SHIN MUN CO LTD     1500001797       18,074     USD             18,074     CN
20248   SHIN MUN CO LTD     1500001530       311     USD             311     CN

  

 
 

 

Schedule 9    
Prepaid Expenses    
Supplier Payments - USD    
  Total USD 860,973

 

              Wire                      
Vendor       Clearing     Payment                      
No   Vendor Name   Document     Amount     Currency   Cleared     Open balance     Locale
20248   SHIN MUN CO LTD     1500001542       9,113     USD             9,113     CN
20248   SHIN MUN CO LTD     1500001571       1,370     USD             1,370     CN
20248   SHIN MUN CO LTD     1500001601       15,482     USD             15,482     CN
20248   SHIN MUN CO LTD     1500001611       16,922     USD             16,922     CN
20248   SHIN MUN CO LTD     1500001643       3,470     USD             3,470     CN
20248   SHIN MUN CO LTD     1500001650       6,635     USD             6,635     CN
20248   SHIN MUN CO LTD     1500001680       11,397     USD             11,397     CN
20248   SHIN MUN CO LTD     1500001685       406     USD             406     CN
20248   SHIN MUN CO LTD     1500001709       5,354     USD             5,354     CN
20248   SHIN MUN CO LTD     1500001715       4,134     USD             4,134     CN
20248   SHIN MUN CO LTD     1500001726       4,134     USD             4,134     CN
20248   SHIN MUN CO LTD     1500001765       17,242     USD             17,242     CN
20259   SHINY SPACE ENTERPRISE CO., LT     1500001734       684     USD     684       -     CN
20258   SP INTERNATIONAL     1500001800       1,284     USD             1,284     NA
20271   TECH-ETCH INC     1500001655       630     USD             630     NA
20278   TESTCO INC     1500001628       2,754     USD     2,275       479     NA
20278   TESTCO INC     1500001704       107     USD             107     NA
20036   THE BERGQUIST COMPANY     1500001837       312     USD             312     NA
20036   THE BERGQUIST COMPANY     1500001626       2,052     USD     1,904       148     NA
20036   THE BERGQUIST COMPANY     1500001710       463     USD             463     NA
20036   THE BERGQUIST COMPANY     1500001711       463     USD             463     NA
20286   TRI-POWER ENGINEERING CO.LTD     1500001604       2,523     USD             2,523     CN
20288   TTI,INC.     1500001777       178     USD     178       -     NA
20288   TTI,INC.     1500001657       5,629     USD     5,629       -     NA
20288   TTI,INC.     1500001719       653     USD             653     NA
20288   TTI,INC.     1500001732       2,292     USD     2,265       27     NA
20288   TTI,INC.     1500001753       397     USD     397       -     NA
20288   TTI,INC.     1500001759       9,971     USD     819       9,151     NA
20296   UNIROYAL ELECTRONICS     1500001652       347     USD     147       200     CN
20293   UNITED CHEMI-CON, INC.     1500001785       4,249     USD             4,249     NA
20293   UNITED CHEMI-CON, INC.     1500001821       1,240     USD             1,240     NA
20293   UNITED CHEMI-CON, INC.     1500001536       9,436     USD     8,116       1,320     NA
20293   UNITED CHEMI-CON, INC.     1500001693       10,972     USD     2,555       8,417     NA
20305   VISHAY AMERICAS, INC.,     1500001801       4,794     USD             4,794     NA
20305   VISHAY AMERICAS, INC.,     1500001843       693     USD             693     NA
20305   VISHAY AMERICAS, INC.,     1500001524       2,460     USD             2,460     NA
20305   VISHAY AMERICAS, INC.,     1500001572       790     USD             790     NA
20305   VISHAY AMERICAS, INC.,     1500001619       4,365     USD             4,365     NA
20305   VISHAY AMERICAS, INC.,     1500001629       13,101     USD             13,101     NA
20305   VISHAY AMERICAS, INC.,     1500001674       449     USD             449     NA
20305   VISHAY AMERICAS, INC.,     1500001689       804     USD             804     NA
20305   VISHAY AMERICAS, INC.,     1500001696       11,862     USD             11,862     NA
20305   VISHAY AMERICAS, INC.,     1500001727       1,356     USD             1,356     NA
20305   VISHAY AMERICAS, INC.,     1500001767       954     USD             954     NA
20305   VISHAY AMERICAS, INC.,     1500001849       1,880     USD             1,880     NA
20308   WATT SHENZHEN ELECTRONICS     1500001737       47,190     USD             47,190     CN
20309   WEAL LAM PARTS & TOOLS LTD.     1500001644       2,460     USD             2,460     CN
20319   WURTH ELECTRONICS MIDCOM     1500001630       3,091     USD     141       2,950     NA
20451   YS Tech USA     1500001731       11,970     USD             11,970     NA

 

 
 

 

Schedule 9
Prepaid Expenses
Supplier Deposits

 

Vendor             Wire         Open  
No   Vendor Name   Clearing Document     Payment     Currency   balance  
20029   AVNET ELECTRONICS     1500001787     $ 71,000     USD   $ 71,000  
20345   OTX LOGISTICS CANADA LIMIT E     1500001660     $ 5,000     USD   $ 5,000  
10271   PUROLATOR COURIER LTD.     1500001501     $ 500     CAD   $ 500  
10380   YUSEN AIR & SEA SERVICE     1500001470     $ 10,000     CAD   $ 10,000  
20029   AVNET ELECTRONICS     1500001566     $ 15,000     USD   $ 15,000  
10450   FEDERAL EXPRESS CANADA     1500001463     $ 15,000     USD   $ 15,000  
20043   SCHENKER     1500001460     $ 5,000     USD   $ 5,000  
    Glen Corporation     Rent - 401 Magnetic Drive             CAD   $ 8,690  
    Enbridge                   CAD   $ 500  
    UPS                   CAD   $ 1,500  
    PUROLATOR COURIER LTD.                   CAD   $ 500  

  

 
 

 

SCHEDULE 10

ROYALTY PAYMENT CUSTOMERS [SECTION 2.6.2.3]

 

 

SCHEDULE 10

ROYALTY PAYMENT CUSTOMERS

 

Customer Account   Account vs.
Product 		  Product
Number 		 
NEW Products <1 year from Release            
NAUTEL LTD   Account        
EVERTZ MICROSYSTEMS   Account        
SONUS NETWORKS, INC   Account        
SONUS NETWORKS, INC   Account        
ZOLL MEDICAL CORPORATION   Account        
EVERTZ MICROSYSTEMS   Account        
VERACITY UK LTD   Account        
VERACITY UK LTD   Account        
ALCATEL- LUCENT 1507/1508R   Product     1507, 1508R  
RVR Electronica (Italy)   Account        
Mellanox   Account        
             
Design in / Submitted for Testing            
KATHREIN-Werke KG   Account        
Asis Pro   Account        
NETSCOUT /ONPATH TECHNOLOGIES   Account        
Comtel Electronics Israel   Account        
Miranda/GV   Account        
Extreme Networks   Product     1582  
Extreme Networks   Product     1525  
A-10   Account        
Arris   Account        

 

NOTES

Account - to include all revenue associated with the Corporate Account

Product - to include only revenue associated with the specific product (or a derivative of that product)

  

 
 

 

 

SCHEDULE 11

KERP PAYMENTS SCHEDULE [SECTION 1.1.13.2]

 

Schedule 11

KERP Payment Schedule

CAD

 

KERP PAYMENTS

 

Name   Jan 9,
2015
[paid by
Tectrol] 		    Mar 27,
2015 		    May 29,
2015 		    Sept 30,
2015 		    Total     Post Closing
Amount [paid
by CUI] 		 
Titto Mathew     2,000       2,000       4,000       7,000       15,000       13,000  
Florian Tiganila     7,500       10,000       12,500       20,000       50,000       42,500  
Abrahim Noorestani     3,000       4,000       5,000       8,000       20,000       17,000  
Bella Lionti     5,250       7,000       8,750       14,000       35,000       29,750  
Steve Mallinson     3,000       4,000       5,000       8,000       20,000       17,000  
Rick Leung     3,750       5,000       6,250       10,000       25,000       21,250  
Paul Ruggier     4,500       6,000       7,500       12,000       30,000       25,500  
Murray Silverman     6,000       8,000       10,000       16,000       40,000       34,000  
Chris Slemensky     2,250       3,000       3,750       6,000       15,000       12,750  
                                                 
      37,250       49,000       62,750       101,000       250,000       212,750  

 

Estimated Withholding Taxes on Post-Closing KERP

 

    CPP     1     10,500
    EI     2     5,600
    EHT     3     4,100
    Subtotal           20,200
    Shared 50/50%     4     (10,100)
    Total Taxes           10,100
                 
TOTAL KERP + SHARE OF TAXES   Total KERP + taxes           222,850

 

NOTES:

1 4.95% of payroll up to $53,600
2 2.632% of payroll up to $49,500
3 1.95% of payroll (no max)
4 CUI/Tectrol agreed to share these costs equally

  

 
 

  

EXHIBIT A

FORM OF APPROVAL AND VESTING ORDER

 

Court File No. 31-1929721
Estate File No. 31-1929721

 

ONTARIO

SUPERIOR COURT OF JUSTICE

(COMMERCIAL LIST)
IN BANKRUPTCY AND INSOLVENCY

 

 

THE HONOURABLE ) WEDNESDAY, THE 3 RD DAY
  )  
____ JUSTICE ___________________________________ ) OF MARCH, 2015

 

 

IN THE MATTER OF THE NOTICE OF INTENTION
TO MAKE A PROPOSAL OF TECTROL INC.

 

APPROVAL AND VESTING ORDER

 

THIS MOTION , made by Tectrol Inc. (the “ Debtor ”) for an order approving the sale transaction (the “Transaction” ) contemplated by an agreement of purchase and sale (the “Sale Agreement” ) between the Debtor and CUI-Canada, Inc. (the “Purchaser” ) dated February 23, 2015 and appended to the Third Report of Duff & Phelps Canada Restructuring Inc., the trustee appointed in re the proposal of the Debtor (the “Proposal Trustee” ), dated <*>, 2015 (the “Third Report” ), and vesting in the Purchaser the Debtor’s right, title and interest in and to the assets described in the Sale Agreement (the “Purchased Assets” ), was heard this day at 330 University Avenue, Toronto, Ontario.

 

ON READING the Third Report and the Affidavit of Richard Gelb sworn on February 24, 2015 (the “ Gelb Affidavit ”), and on hearing the submissions of counsel for the Debtor, the Proposal Trustee and the Purchaser, no one appearing for any other person on the service list, although properly served as appears from the affidavit of Kyle B. Plunkett sworn February 24, 2015, filed.

 

 
 

 

1.           THIS COURT ORDERS AND DECLARES that the Transaction is hereby approved, and the execution of the Sale Agreement by the Debtor is hereby authorized and approved, with such minor amendments as the Debtor may deem necessary. The Debtor is hereby authorized and directed to take such additional steps and execute such additional documents as may be necessary or desirable for the completion of the Transaction and for the conveyance of the Purchased Assets to the Purchaser.

 

2.           THIS COURT ORDERS AND DECLARES that upon the delivery of a Proposal Trustee’s certificate to the Purchaser substantially in the form attached as Schedule “ A ” hereto (the “ Proposal Trustee’s Certificate ”), all of the Debtor’s right, title and interest in and to the Purchased Assets described in the Sale Agreement and listed on Schedule “ B ” hereto shall vest absolutely in the Purchaser, free and clear of and from any and all security interests (whether contractual, statutory, or otherwise), hypothecs, mortgages, trusts or deemed trusts (whether contractual, statutory, or otherwise), liens, executions, levies, charges, or other financial or monetary claims, whether or not they have attached or been perfected, registered or filed and whether secured, unsecured or otherwise (collectively, the “ Claims ”) including, without limiting the generality of the foregoing: (i) all charges, security interests or claims evidenced by registrations pursuant to the Personal Property Security Act (Ontario) or any other personal property registry system; and (ii) those claims listed on Schedule “ C ” hereto (all of which are collectively referred to as the “ Encumbrances ”, which term shall not include the permitted encumbrances, easements and restrictive covenants listed on Schedule “ D ” hereto) and, for great certainty, this Court orders that all of the Encumbrances affecting or relating to the Purchased Assets are hereby expunged and discharged as against the Purchased Assets.

 

3.           THIS COURT ORDERS that for the purposes of determining the nature and priority of Claims, the net proceeds from the sale of the Purchased Assets shall stand in the place and stead of the Purchased Assets, and that from and after the delivery of the Proposal Trustee’s Certificate all Claims and Encumbrances shall attach to the net proceeds from the sale of the Purchased Assets with the same priority as they had with respect to the Purchased Assets immediately prior to the sale, as if the Purchased Assets had not been sold and remained in the possession or control of the person having that possession or control immediately prior to the sale.

 

- 2 -
 

  

4.           THIS COURT ORDERS AND DIRECTS the Proposal Trustee to file with the Court a copy of the Proposal Trustee’s Certificate, forthwith after delivery thereof.

 

5.           THIS COURT ORDERS that, pursuant to clause 7(3)(c) of the Canada Personal Information Protection and Electronic Documents Act , the Debtor is authorized and permitted to disclose and transfer to the Purchaser all human resources and payroll information in the Company’s records pertaining to the Debtor’s past and current employees. The Purchaser shall maintain and protect the privacy of such information and shall be entitled to use the personal information provided to it in a manner which is in all material respects identical to the prior use of such information by the Debtor.

 

6.           THIS COURT ORDERS that, notwithstanding:

 

(a)          the pendency of these proceedings;

 

(b)          any applications for a bankruptcy order now or hereafter issued pursuant to the Bankruptcy and Insolvency Act (Canada) in respect of the Debtor and any bankruptcy order issued pursuant to any such applications; and

 

(c)          any assignment in bankruptcy made in respect of the Debtor;

 

the vesting of the Purchased Assets in the Purchaser pursuant to this Order shall be binding on any trustee in bankruptcy that may be appointed in respect of the Debtor and shall not be void or voidable by creditors of the Debtor, nor shall it constitute nor be deemed to be a fraudulent preference, assignment, fraudulent conveyance, transfer at undervalue, or other reviewable transaction under the Bankruptcy and Insolvency Act (Canada) or any other applicable federal or provincial legislation, nor shall it constitute oppressive or unfairly prejudicial conduct pursuant to any applicable federal or provincial legislation.

 

7.           THIS COURT ORDERS AND DECLARES that the Transaction is exempt from the application of the Bulk Sales Act (Ontario).

 

- 3 -
 

  

8.           THIS COURT ORDERS that, notwithstanding the provisions of subsection 171(3) of the Business Corporations Act (Ontario) (the “ OBCA ”), the Debtor be and is hereby authorized and directed, upon filing of the Proposal Trustee’s Certificate, to complete, execute and file articles of amendment for the sole purpose of changing the corporate name of the Debtor to 252862 Ontario Inc. (and such amendment shall be deemed to have been duly authorized by Section 168 of the OBCA without any shareholder or director resolution approving such amendment being required), and if the Debtor fails to comply, to authorize and order the Proposal Trustee to do so (such articles of amendment to be deemed to have been signed by a director or an officer of the Debtor and executed in accordance with the OBCA when so signed by the Proposal Trustee as directed by this Court), and this Court hereby directs the Director (as defined in the OBCA) to endorse thereon a certificate of amendment upon receipt from the Debtor of two duplicate originals of such articles of amendment together with the prescribed fees and any other required documents under the OBCA (which the Proposal Trustee be and is hereby authorized and directed to complete, execute and file for and on behalf of the Debtor and any officer and director of the Debtor, if and as required) except for any such documents as have been dispensed or otherwise dealt with pursuant to the deeming provisions contained herein.

 

9.           THIS COURT ORDERS that the Purchaser shall be authorized to take all steps as may be necessary to effect the discharge of the Encumbrances.

 

10.          THIS COURT ORDERS that the Confidential Appendices ● and ● of the Third Report be kept confidential and under seal until the earlier of (a) Closing; or (b) further Order of this Court.

 

11.          THIS COURT ORDERS that Schedule “ 11 ” to the Sale Agreement shall be and is hereby sealed pending further Order of this Court.

 

12.          THIS COURT HEREBY REQUESTS the aid and recognition of any court, tribunal, regulatory or administrative body having jurisdiction in Canada or in the United States to give effect to this Order and to assist the Debtor and the Proposal Trustee and its agents in carrying out the terms of this Order. All courts, tribunals, regulatory and administrative bodies are hereby respectfully requested to make such orders and to provide such assistance to the Debtor and the Proposal Trustee, as an officer of this Court, as may be necessary or desirable to give effect to this Order or to assist the Debtor and the Proposal Trustee and its agents in carrying out the terms of this Order.

 

   

 

- 4 -
 

  

SCHEDULE A

 

FORM OF PROPOSAL TRUSTEE’S CERTIFICATE

 

Court File No. 31-1929721
Estate File No. 31-1929721

 

ONTARIO

SUPERIOR COURT OF JUSTICE

(COMMERCIAL LIST)
IN BANKRUPTCY AND INSOLVENCY

 

IN THE MATTER OF THE NOTICE OF INTENTION
TO MAKE A PROPOSAL OF TECTROL INC.

 

PROPOSAL TRUSTEE’S CERTIFICATE

 

RECITALS

 

A.       Pursuant to a Notice of Intention to Make a Proposal dated November 6, 2014, Duff & Phelps Canada Restructuring Inc. was appointed trustee in re the proposal of Tectrol Inc. (the “Proposal Trustee” ).

 

B.        Pursuant to an Order of the Court dated March 3, 2015, the Court approved the agreement of purchase and sale made as of February 23, 2015 (the “Sale Agreement” ) between the Debtor and CUI-Canada, Inc. (the “Purchaser” ), and provided for the vesting in the Purchaser of the Debtor’s right, title and interest in and to the Purchased Assets, which vesting is to be effective with respect to the Purchased Assets upon the delivery by the Proposal Trustee to the Purchaser of a certificate confirming (i) the payment by the Purchaser of the Purchase Price for the Purchased Assets; (ii) that the conditions to Closing as set out in Article 5 of the Sale Agreement have been satisfied or waived by the Debtor and the Purchaser; and (iii) the Transaction has been completed to the satisfaction of the Debtor and the Proposal Trustee.

 

C.       Unless otherwise indicated herein, terms with initial capitals have the meanings set out in the Sale Agreement.

 

 
 

 

 

THE TRUSTEE CERTIFIES the following:

 

1.       The Purchaser has paid and the Debtor has received the Purchase Price for the Purchased Assets payable on the Closing Date pursuant to the Sale Agreement.

 

2.       The conditions to Closing as set out in Article 5 of the Sale Agreement have been satisfied or waived by the Debtor and the Purchaser.

 

3.       The Transaction has been completed to the satisfaction of the Debtor and the Proposal Trustee.

 

4.       This Certificate was delivered by the Proposal Trustee at < time > on March <*>, 2015.

 

 

 

 

DUFF & PHELPS CANADA

RESTRUCTURING INC. , solely in its

capacity as the Trustee acting in re the proposal

of Tectrol Inc.

 

  Per:  
    Name:
    Title:

 

- 2 -
 

 

SCHEDULE B
PURCHASED ASSETS

 

 
 

 

SCHEDULE C
ENCUMBRANCES

 

1. General Security Agreement in favour of Tectrol Technology Inc. dated October 13, 1995 and registered pursuant to the Personal Property Security Act on November 2, 2005 as Instrument No. 2005 1102 1550 1862 8970.

 

2. General Security Agreement in favour of the Royal Bank of Canada dated September 3, 2013 and registered pursuant to the Personal Property Security Act on January 2, 2008 as Instrument No. 2008 0102 1445 1530 6667 and assigned to Tectrol Technology Inc. on November 5, 2014 and registered on November 24, 2014 as Instrument No. 2014 1124 1439 1862 5691.

 

3. Registration in favour of EZ Lift Toronto Ltd. registered pursuant to the Personal Property Security Act on November 14, 2014 as Instrument No. 2014 1114 1116 1793 0337.

 

 
 

 

SCHEDULE D
PERMITTED ENCUMBRANCES

 

(unaffected by the Vesting Order)

 

1. Lease(s) in favour of Ricoh Toronto East registered pursuant to the Personal Property Security Act on March 26, 2012 as Instrument No. 2012 0326 1944 1531 2861.

   

 
 

 

EXHIBIT B

FORM OF BILL OF SALE RE PURCHASED ASSETS

 

 

BILL OF SALE

 

THIS INDENTURE made the _______ day of March, 2015.

 

BETWEEN:

 

TECTROL INC. , a corporation incorporated under the laws of Ontario,
(the “ Seller ”)

 

- and -

 

CUI-CANADA, INC. , a corporation incorporated under the laws of the Provence of Nova Scotia
(the “ Buyer ”)

 

WHEREAS:

 

A. On November 6, 2014, the Seller commenced insolvency proceedings by filing a Notice of Intention to Make a Proposal (“ NOI ”) pursuant to the Bankruptcy and Insolvency Act , R.S.C. 1985, c. B-3, as amended. Duff & Phelps Canada Restructuring Inc. was appointed as the trustee in re the proposal of Tectrol Inc. (the “Proposal Trustee” ) under the NOI.

 

B. The Seller and the Buyer entered into an Asset Purchase Agreement dated February 23, 2015 (the “ APA ”), which provides for the sale by the Seller of the Purchased Assets (as defined in the APA) to the Buyer, subject to Court approval.

 

C. By an Approval and Vesting Order dated March 3, 2015 of <*> Justice <*>, the terms and provisions of the APA have been approved, and vesting the Purchased Assets in the Buyer effective on Closing.

 

NOW THEREFORE THIS INDENTURE WITNESSES that in consideration of the sum of Five Million Five Hundred Thousand Dollars ( USD$5,500,000.00 ) of lawful money of the United States of America, and other good and valuable consideration paid by the Buyer to the Seller, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

 

1. Unless otherwise specifically defined in this Indenture, any capitalized terms used in this Indenture shall have the meanings given to them in the APA.

 

2. The Seller hereby grants, bargains, conveys, sells, assigns, transfers and sets over to the Buyer all of the right, title, interest and benefit, if any, of the Seller in and to the Purchased Assets including as described in Schedule “ A ” hereto.

 

3. Each of the parties hereto will, from time to time and at the reasonable request and expense of the party making such request, do or take or cause to be done or taken such acts or actions, and will execute and deliver to the other or cause to be executed and delivered to the other such further instruments, documents and assurances, as may be reasonably necessary to give effect to this Indenture.

 

 
 

 

4. To the extent that there is a conflict between the terms and provisions of this Indenture and the terms and provisions of the APA, the terms and provisions of the APA shall govern. In the event of any conflict between the terms and provisions of this Indenture or the terms and provisions of the APA and the terms and provisions of the Approval and Vesting Order, the terms and provisions of the Approval and Vesting Order shall govern.

 

5. This Indenture will be governed by and construed in accordance with the laws of the Province of Ontario and the laws of Canada applicable therein.

 

6. This Indenture and all of its provisions will enure to the benefit of and be binding upon the parties hereto and their respective successors and assigns.

 

7. This Indenture may be executed in counterparts, and acceptance of this Indenture may be provided by facsimile transmission or email transmission in PDF format and, upon such execution and transmission, this Indenture shall be binding on the parties hereto with the same force and effect as if originally executed.

 

IN WITNESS WHEREOF the parties have executed this Indenture on the date first above written.

 

  TECTROL INC.
   
  Per:   c/s
    Name:  Richard Gelb  
    Title:   President  
   
  CUI-CANADA, INC.
   
  Per:   c/s
    Name:  William J. Clough  
    Title:   CEO  

  

- 2 -
 

 

Schedule A

 

Equipment

Inventory

Assumed Contracts

Intellectual Property

Goodwill of the Business

   

 

 

Exhibit 99.2

 

LEASE

 

BETWEEN

 

454675 ONTARIO LIMITED

 

(the “Landlord”)

 

- and -

 

CUI-CANADA, INC.

 

(the “Tenant”)

 

 
 

 

TABLE OF CONTENTS

 

    Page
     
Article 1 DEFINITIONS, EXHIBITS AND INTERPRETATION 1
1.1 Definitions 1
1.2 Exhibits 6
1.3 Headings 6
1.4 Gender and Number 6
1.5 Table of Contents 6
1.6 Applicable Law 6
1.7 Obligations as Covenants 7
1.8 Severability 7
1.9 Covenants Independent 7
1.10 Currency 7
1.11 Entire Agreement 7
1.12 Calculations 7
1.13 Successors and Assigns 7
1.14 Statutory References 8
1.15 Interpretation 8
1.16 Modification 8
1.17 No Waiver 8
1.18 Acknowledgement of Commencement Date and Basic Rent 9
Article 2 DEMISE 9
2.1 Demise 9
2.2 Condition 9
2.3 Quiet Enjoyment 9
2.4 Early Occupancy by Tenant 10
2.5 Tenant’s Work 10
Article 3 RENT 10
3.1 Payment of Basic Rent 10
3.2 Net Lease; Additional Rent 10
3.3 Place of Payment 10
3.4 Default Interest 11
3.5 Rent-Adjustment for Partial Months 11
Article 4 ALTERATIONS AND TENANT EQUIPMENT 11
4.1 Alterations 11
4.2 Improvements 11
4.3 Signage 12
4.4 Encroachments 12

 

 
 

 

Article 5 USE AND OCCUPANCY 13
5.1 Use 13
5.2 Conduct of Business 13
5.3 Compliance 13
5.4 Easements 13
5.5 Access and Control of Existing Easements 13
5.6 Not to Cause a Nuisance or Waste 14
5.7 Loudspeakers, etc. 14
5.8 Environmental Matters 14
5.9 Environmental Compliance 15
5.10 Remediation by Landlord 15
Article 6 UTILITIES AND REPAIRS 16
6.1 Utilities 16
6.2 Maintenance, Repair and Replace 16
Article 7 TAXES AND SALES TAXES 16
7.1 Payment of Taxes 16
7.2 Proration at Commencement and End of Term 17
7.3 Sales Taxes 17
7.4 Business Taxes and Other Taxes of Tenant 17
7.5 Realty Taxes 17
Article 8 INSURANCE 18
8.1 Maintenance of Policies 18
8.2 Insurance Providers 19
8.3 Premiums 20
8.4 Insurable Value 20
8.5 Compliance with Policy Terms 20
8.6 No Additional Policies 20
8.7 Waivers 20
8.8 Use Not To Affect Insurance 20
Article 9 DAMAGE OR DESTRUCTION 21
9.1 Effect of Damage or Destruction 21
9.2 Insurance Proceeds 21
9.3 Application of Insurance Proceeds 21
Article 10 WAIVERS AND INDEMNITIES 22
10.1 Tenant’s Waiver and Indemnification 22
Article 11 RESTORATION 23
11.1 Restoration 23
11.2 Excess Net Proceeds – Casualty 25

  

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Article 12 ASSIGNMENT, SUBLETTING AND FINANCING 25
12.1 Assignment and Subletting 25
12.2 No Release 26
12.3 Equity Transfers 26
12.4 Financing 27
12.5 Dealings by Landlord 27
12.6 Subordination and Attornment 27
Article 13 END OF TERM 27
13.1 Surrender 27
13.2 Holding Over 28
13.3 Survival of Obligations 28
Article 14 LIENS AND ESTOPPEL CERTIFICATES 28
14.1 Construction Liens 28
14.2 Estoppel Certificates 29
Article 15 DEFAULTS AND REMEDIES 29
15.1 Defaults by Tenant 29
15.2 Landlord’s Remedies 31
15.3 Bankruptcy Relief 33
15.4 Remedies Not Exclusive 33
15.5 No Mitigation 33
15.6 No Waiver 33
15.7 Remedies Cumulative 33
15.8 Recovery of Enforcement Costs 34
Article 16 RIGHT OF LANDLORD TO PERFORM TENANT’S COVENANTS 34
16.1 Right to Perform 34
16.2 Reimbursement 34
16.3 Exercise of Remedies 34
16.4 Inspection 34
16.5 Costs 35
16.6 No Eviction 35
16.7 No Interference 35
16.8 Right to Re-Enter. 35
Article 17 NOTICES 36
17.1 Notices 36
Article 18 MISCELLANEOUS 36
18.1 Performance by Landlord 36
18.2 Time 36
18.3 Registration on Title 36
18.4 Only Landlord/Tenant Relationship 36

  

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18.5 Counterparts 36
18.6 Compliance with the Planning Act 37
18.7 Successors 37
18.8 Commissions 37

 

Exhibit “A” - Existing Easements
Exhibit “B” - Tenant’s Work

Exhibit “C” - Extension Option

 

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THIS LEASE made as of the 1 st day of March, 2015.

 

BETWEEN:

 

454675 ONTARIO LIMITED
(the “Landlord”)

 

- and -

 

CUI-CANADA, INC.
(the “Tenant”)

 

Article 1
DEFINITIONS, EXHIBITS AND INTERPRETATION

 

1.1 Definitions.

 

In this Lease, the following defined terms have the meanings set forth for them below or in the section of this Lease indicated below:

 

(a) “Additional Rent” has the meaning set forth in Section 3.2.

 

(b) “Affiliates” means, with respect to any Person, any Person that is a subsidiary of the other or both are subsidiaries of the same Person or each of them is controlled by the same Person. A Person shall be presumed to have control when it possesses the power, directly or indirectly, to direct, or cause the direction of, the management or policies of another Person, whether through ownership of voting securities, by contract, or otherwise.

 

(c) “Alterations” has the meaning set forth in Section 4.1.

 

(d) “Basic Rent” has the meaning set forth in Section 3.1.

 

(e) “Building” means the building constructed or installed upon the Land as of the Commencement Date.

 

(f) “Business Day” means any day other than a Saturday, Sunday or statutory holiday in the Province of Ontario.

 

(g) “Business Taxes” means:

 

(i) all taxes, rates, duties, assessments and other charges that are levied, rated, charged or assessed against or in respect of all improvements, equipment and facilities of Tenant on or in the Premises or any part or parts thereof whether invoiced to Tenant or Landlord on account of its ownership thereof or interest therein; and

 

 
 

 

(ii) every tax, sales tax, duty, levy, assessment, goods and services tax, or license fee which is levied, rated, charged or assessed against or in respect of any and every business carried on from the Premises, or the payment or receipt of rent by Tenant, or in respect of the use or occupancy thereof or any other part of the Premises by Tenant whether invoiced to Tenant or Landlord on account of its ownership thereof or interest therein.

 

(h) “Capital Taxes” means capital taxes payable by Landlord in respect of its ownership or other interest in the Premises, namely any tax or taxes payable under any provincial or federal legislation based upon or computed by reference to the paid-up capital or place of business of Landlord as determined for the purposes of such tax or based upon or computed by reference to the taxable capital employed in Canada, or any similar tax levied, imposed or assessed in the future in lieu thereof or in addition thereto by any governmental authority, including large corporation’s taxes.

 

(i) “Casualty” means any loss of or damage to any property included within the Premises.

 

(j) “Claims” has the meaning set forth in 10.1.

 

(k) “Commencement Date” means March 1, 2015 .

 

(l) “Costs” of a Person with respect to a specified transaction shall mean all reasonable costs and expenses incurred by such Person and directly arising out of such transaction, including without limitation, reasonable solicitors’ fees and expenses, court costs, brokerage fees, escrow fees, recording fees and transfer taxes, as the circumstances require.

 

(m) “Default Rate” means a fluctuating rate per annum, adjustable on the day of any change in the Prime Rate, equal to the Prime Rate plus four percent (4%) per annum, or if such rate shall be in excess of the highest rate of interest permitted by applicable Laws, then at the highest rate permitted by such Laws.

 

(n) “Environmental Laws” means all applicable federal, provincial, municipal, regional and local laws, including common law and all statutes, by-laws, rules and regulations and all orders, directives and decisions rendered by, and policies, instructions, guidelines and similar guidance of, any ministry, department or administrative or regulatory agency relating to the protection of the environment or occupational health and safety including, those pertaining to reporting, licensing, permitting, investigation, remediation and clean up or other remediation or corrective action in connection with any presence, release, discharge, escape or disposal or threat of same of any Hazardous Substances or relating to the manufacture, processing, distribution, use, treatment, storage, disposal, packaging, transport, handling or containment of any Hazardous Substances, as amended and as in effect from time to time (including, without limitation, the Environmental Protection Act , R.S.O. 1990 c.E. 19, the Hazardous Products Act , R.S.C. 1985, c.H.-3, the Gasoline Handling Act , R.S.O. 1990 c.G. 4, the Environmental Code of Practice for Underground Storage Tank Systems Containing Petroleum Products and Allied Petroleum Products , 1993 Edition (CCME EPC-LST-61E), and the Occupational Health and Safety Act , R.S.O. 1990 c.O.1; and any successor statutes and regulations to the foregoing.

 

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(o) “Event of Default” has the meaning set forth in Section 15.1.

 

(p) “Existing Easements” means the easements/rights of way set out on Exhibit “A” hereto as each is granted, reduced, expanded and/or otherwise modified from time to time by Landlord.

 

(q) “Force Majeure” means any cause or causes which the party claiming Force Majeure is, despite its reasonable commercial efforts, unable to prevent or overcome, including but not limited to acts of god, strikes, lock-outs, walkouts or other labour disputes, shortages of labour or materials, failure of power, restrictive governmental laws or regulations, riots, civil strife, war, insurrection, or acts of a public enemy, or other reason of a like nature but specifically excluding the negligence or wilful misconduct of the party claiming Force Majeure or those for whom it is responsible at law, lack or insufficiency of money, failure to make payment of monies or provide required security, or the insolvency or bankruptcy of the party claiming Force Majeure.

 

(r) “Hazardous Substance” means any of (i) all chemicals, materials, contaminants, wastes and substances defined as or included in the definition of “contaminants”, “wastes”, “hazardous wastes”, “hazardous materials”, “extremely hazardous wastes”, “restricted hazardous wastes”, “toxic substances”, “toxic pollutants”, or “Pollutants”, or words of similar import under any applicable Environmental Laws; and (ii) all other chemicals, materials and substances, exposure to which is prohibited, limited or regulated by any governmental authority, including, without limitation, radioactive materials, urea formaldehyde based substances, asbestos and asbestos-containing materials in any form, lead-based paint, polychlorinated biphenyls (“PCBs”), and substances and compounds containing PCBS, or dioxins of any kind.

 

(s) “Improvements” means Buildings, structures, pavement, lighting fixtures or other improvements installed or constructed upon the Land as of the Commencement Date and any Alterations constructed during the Term and all items generally considered as leasehold improvements, including, without limitation, all fixtures, equipment, improvements, installations, alterations and additions from time to time made, erected or installed by or on behalf of Tenant, or any previous occupant of the Premises, in the Premises but excluding Tenant Equipment.

 

(t) “Land” means the real property located in the City of Toronto, in the Regional Municipality of Toronto, legally described as Parcel 11-1, Section M1982; Lot 11 & Part Lot 12, Plan 66M1982, Part 1 66R12584 and incorporated herein by this reference, all encumbrances, easements, rights-of-way and other appurtenances to such real property.

 

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(u) “Landlord” means 454675 Ontario Limited , its successors and assigns.

 

(v) “Landlord’s Address” means:

 

Tectrol Inc.

550 Eglinton Ave. W.

P.O. Box 23030

Toronto, Ontario 

M5N 1B0

  

Attention: Richard Gelb
Email:       Tectrol.richardgelb@gmail.com

 

with a copy to:

 

David J. Goldstein
304-23 Lesmill Road
Toronto, Ontario
M3B 3P6

Fax No.: (416) 850-9376

 

(w) “Laws” means any and all present or future federal, provincial or local laws (including common law), statutes, ordinances, rules, regulations, orders, decrees or requirements of any and all governmental or quasi-governmental authorities having jurisdiction. The term “Laws” shall include all Environmental Laws and any requirements under agreements with any and all governmental or quasi-governmental authorities having jurisdiction affecting the Premises.

 

(x) “Leasehold Mortgage” means any mortgage, deed of trust, assignment of rents, assignment of leases, security agreement or other hypothecating instrument encumbering Tenant’s interest under this Lease or the leasehold estate in the Premises created hereby, any agreements executed in connection with Tenant’s operation of the Premises, or Tenant’s interest in any fixtures, machinery, equipment, Land, Buildings, Improvements or other property constituting a part of the Premises.

 

(y) “Net Proceeds” means the net proceeds of insurance resulting from any Casualty after application to payments required under Section 9.3 as applicable in the circumstances.

 

(z) “Person” means an individual, partnership, limited liability company, association, corporation or other entity.

 

(aa) “Premises” means the Land and all Improvements.

 

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(bb) “Prime Rate” means the floating annual rate of interest established from time to time by Royal Bank of Canada, Head Office, Toronto, Ontario, as its reference rate for determining its rate of interest on Canadian Dollar commercial loans in Canada to its most creditworthy customers provided, however, that in the event Royal Bank of Canada no longer publishes such rate, Landlord shall select a comparable reference for purposes of determining the Prime Rate.

 

(cc) “Rent” means Basic Rent, Additional Rent, and all other amounts required to be paid by Tenant under this Lease.

 

(dd) “Sales Taxes” means any business transfer tax, value added tax, sales tax, multi-stage sales tax, goods and services tax, or any other tax levied, rated, charged or assessed now or in the future upon Landlord in respect of Rent or other payments payable by Tenant under this Lease or in respect of the rental or tenancy of the Premises by Tenant under this Lease or the goods and services provided by Landlord hereunder.

 

(ee) “Tax Year” has the meaning set forth in Section 7.2.

 

(ff) “Taxes” means all taxes, rates, levies, fees, duties, assessments, special assessments and charges (including local improvement taxes and similar levies and charges that are imposed, levied, rated, charged or assessed) upon or with respect to the Premises, the Tenant Equipment, or the personal property used in operating the Premises, all Capital Taxes and all taxes, levies and charges which may be assessed, levied or imposed in replacement of all or any part of real or personal property taxes, assessments, or special assessments as revenue sources, and which in whole or in part are measured or calculated by or based upon the Premises, the respective estates of Landlord or Tenant, or the rents and other charges payable by Tenant, or the Tenant Equipment or personal property used in the Premises.

 

(gg) “Tenant” means CUI-CANADA, INC. , its permitted successors and permitted assigns.

 

(hh) “Tenant Equipment” means Tenant’s trade fixtures and equipment not in the nature of fixtures.

 

(ii) “Tenant’s Address” means:

 

l

 

Attention: Mr. l
Fax No.: l

 

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with a copy to:

 

l

 

Attention: l
Fax No.: l

 

(jj) [INTENTIONALLY DELETED]

 

(kk) “Term” means the period commencing on the Commencement Date and continuing for a period of FIVE (5) years thereafter unless terminated earlier as provided herein.

 

(ll) “Transfer” has the meaning set forth in Section 12.1.

 

1.2 Exhibits.

 

The Exhibits listed below are attached to and, incorporated in this Lease. In the event of any inconsistency between such Exhibits and the terms and provisions of this Lease, the terms and provisions of this Lease will control. The Exhibits to this Lease are:

 

Exhibit “A” Existing Easements

Exhibit “B” Tenant’s Work

Exhibit “C” Extension Option

  

1.3 Headings.

 

The headings, subheadings, and any marginal notes contained in this Lease and the table of contents preceding this Lease are inserted only as a matter of convenience and for reference and in no way define, limit or describe the scope or intent of this Lease.

 

1.4 Gender and Number.

 

Words importing the singular shall include the plural and vice versa, and words importing gender shall include all genders.

 

1.5 Table of Contents.

 

The table of contents preceding this Lease but under the same cover is for the purposes of convenience and reference only and is not to be deemed or construed in any way as part of this Lease or supplemental thereto or amendatory thereof.

 

1.6 Applicable Law.

 

This Lease shall be governed by, construed and enforced in accordance with the laws of the Province of Ontario and the laws of Canada applicable therein.

 

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1.7 Obligations as Covenants.

 

Each obligation or agreement of Landlord or of Tenant contained in this Lease, even though not expressed as a covenant, is considered for all purposes to be a covenant.

 

1.8 Severability.

 

If any covenant, obligation or agreement contained in this Lease, or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Lease or the application of such covenant, obligation or agreement to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby and each covenant, obligation and agreement of this Lease shall be separately valid and enforceable to the fullest extent permitted by law.

 

1.9 Covenants Independent.

 

Each covenant contained in this Lease is considered for all purposes to be a separate and independent covenant, and a breach of a covenant by either Landlord or Tenant will not discharge or relieve the other party from its obligation to perform each of its covenants.

 

1.10 Currency.

 

All reference to currency in this Lease shall be deemed, unless the context otherwise requires, to be a reference to lawful money of Canada.

 

1.11 Entire Agreement.

 

The Lease and all of the Exhibits attached and the Indemnity Agreement set forth all of the covenants, promises, agreements, conditions and understandings between Landlord and Tenant concerning the subject matter hereof. No subsequent amendment to the Lease shall be binding upon Landlord or Tenant unless in writing and signed by the proper signing officers of each party. Landlord and Tenant are business entities having substantial experience with the subject matter of this Lease and have each fully participated in the negotiation and drafting of this Lease. Accordingly, this Lease shall be construed without regard to the rule providing that ambiguities in a document are to be construed against the drafter.

 

1.12 Calculations.

 

Except as otherwise expressly provided herein, all calculations required or permitted under this Lease shall be made on the basis of generally accepted Canadian accounting principles and practices as commonly used in the real estate industry in Canada, applied on a consistent basis.

 

1.13 Successors and Assigns.

 

All of the terms and provisions of the Lease shall be binding upon and enure to the benefit of the parties and their respective heirs, executors, administrators, permitted successors and permitted assigns.

 

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1.14 Statutory References.

 

All references herein to statutes, by-laws and other legislative enactments, or any part or parts thereof, include such statutes, by-laws and enactments as they may be amended or re-enacted from time to time and all statutes, by-laws and enactments passed in substitution thereof.

 

1.15 Interpretation.

 

As used in this Lease, the singular shall include the plural and any gender shall include all genders as the context requires and the following words and phrases shall have the following meanings:

 

(a) “including” shall mean “including without limitation”;

 

(b) “provisions” shall mean “provisions, terms, agreements, covenants and/or conditions”;

 

(c) “lien” shall mean “lien, charge, encumbrance, title retention agreement, pledge, security interest, mortgage and/or deed of trust”;

 

(d) “obligation” shall mean “obligation, duty, agreement, liability, covenant and/or condition”;

 

(e) “any of the Premises” shall mean “the Premises or any part thereof or interest therein”;

 

(f) “any of the Land” shall mean “the Land or any part thereof or interest therein”;

 

(g) “any of the Improvements” shall mean “the Improvements or any part thereof or interest therein”; and

 

(h) “any Tenant Equipment” shall mean “the Tenant Equipment or any part thereof or interest therein.”

 

1.16 Modification.

 

No modification, waiver or amendment of this Lease or of any of its conditions or provisions will be binding upon a party unless in writing signed by such party.

 

1.17 No Waiver.

 

No waiver of any provision of this Lease will be implied by any failure of Landlord to enforce any remedy upon the violation of such provision, even if such violation is continued or repeated subsequently. No express waiver will affect any provision other than the one specified in such waiver, and that only for the time and in the manner specifically stated.

 

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1.18 Acknowledgement of Commencement Date and Basic Rent.

 

At the request of either party hereto, the other party hereto together with the requesting party shall acknowledge in writing the Commencement Date and the amount of the then applicable Basic Rent.

 

Article 2
DEMISE

 

2.1 Demise.

 

Subject to the terms, covenants, conditions and provisions of this Lease, Landlord leases to Tenant, and Tenant leases from Landlord, the Premises for the Term.

 

2.2 Condition.

 

Landlord leases and will lease and Tenant takes and will take the Premises AS IS. Tenant acknowledges that Landlord (whether acting as landlord hereunder or in any other capacity) has not made and will not make, nor shall Landlord be deemed to have made, any warranty or representation, express or implied, with respect to any of the Premises, including any warranty or representation as to (a) its fitness, design or condition for any particular use or purpose, (b) the quality of the material or workmanship therein, (c) the existence of any defect, latent or patent, (d) value, (e) compliance with Laws, (f) location, (g) use, (h) condition, (i) merchantability, (j) quality, (k) description, (l) durability, (m) operation or (n) the existence of any Hazardous Substance; and all risks incident thereto are to be borne by Tenant. Tenant acknowledges that the Premises has been inspected by Tenant and is satisfactory to it and that the Building and other Improvements existing on the Land have been inspected by Tenant and are satisfactory to it. In the event of any defect or deficiency in any of the Premises of any nature, whether latent or patent, Landlord shall not have any responsibility or liability (including strict liability in tort) with respect thereto, and in no event shall Landlord have any responsibility or liability for any incidental or consequential damages. Tenant expressly waives any right of rescission and all claims for damages by reason of any statement, representation, warranty, assurance, promise or agreement, if any. and Tenant shall indemnify and hold Landlord, its Affiliates, and all of their agents, employees, directors, officers, legal representatives, successors and assigns harmless from and against all costs, claims, expenses, or causes of action arising in connection with or out of the condition of the Premises. Tenant’s waivers and indemnification obligations hereunder shall survive the termination of this Lease.

 

2.3 Quiet Enjoyment.

 

Landlord covenants that, during the Term, Landlord will not disturb Tenant’s quiet and peaceful possession of the Premises, subject, however, to (a) the terms and conditions of this Lease, and (b) any other matter created or consented to by Tenant.

 

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Notwithstanding the foregoing or anything else contained in this Lease, from and after the Fifth (5 th ) Year of the Lease Term including during any Extension Term, in the event that the Landlord intends to demolish all or part of the Premises and/or the Building, the Landlord shall be entitled to terminate this Lease and all covenants and obligations contained herein, on a date which shall not be earlier than at least twelve (12) months after delivery of written notice of such intention to the Tenant. The Tenant acknowledges that if the Lease is terminated in accordance with this paragraph, the Tenant shall and does hereby release the Landlord from all costs, expenses, claims, losses or damages suffered or incurred as a result of such termination, howsoever caused and the Tenant agrees to surrender and give vacant possession of the Premises to the Landlord on the date set out in the notice.

 

2.4 Early Occupancy by Tenant.

 

[INTENTIONALLY DELETED]

 

2.5 Tenant’s Work.

 

[INTENTIONALLY DELETED]

 

Article 3
RENT

 

3.1 Payment of Basic Rent.

 

Tenant shall pay to Landlord, yearly and every year during the Term, without any previous demand and without any set-off, compensation, abatement or deduction whatsoever, an annual basic rent in Canadian dollars (the “Basic Rent”) as follows:

 

(a) for each of the first five (5) years of the Term, an annual Basic Rent equal to [NTD: to be determined following review of Altus report] , payable in advance in equal consecutive monthly instalments on the first day of each and every month during such period [ NTD: ADVISE ON ANNUAL RENT BUMPS IF ANY] ;

 

3.2 Net Lease; Additional Rent.

 

It is the intent of the parties that the Basic Rent provided in this Lease will be a net payment to Landlord, that this Lease shall be absolutely net and carefree to Landlord and that Landlord will not be required to pay any costs or expenses or provide any services in connection with the Premises and Tenant will bear all costs and expenses relating to the Premises. Accordingly, Tenant covenants and agrees to pay, without any set-off, compensation, abatement or deduction and in addition to Basic Rent, all costs and expenses relating to this Lease and the Premises (collectively, “Additional Rent”), including, without limitation (a) Taxes; (b) Business Taxes; (c) insurance costs; (d) utility charges; (e) operating expenses; and (f) maintenance, repair and replacement expenses.

 

3.3 Place of Payment.

 

All Basic Rent and other Rent will be paid to Landlord in lawful money of Canada, at Landlord’s Address or to such other Person or at such other place as Landlord may from time to time designate by notice to Tenant.

 

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3.4 Default Interest.

 

Tenant shall pay to Landlord interest at the Default Rate on all payments of Rent from the respective due dates thereof if the same are not paid within five (5) Business Days following the date when due until such sums are paid in full.

 

3.5 Rent-Adjustment for Partial Months.

 

If the Commencement Date is not on the first day of a calendar month, or the last day of the Term is not the last day of a calendar month, then Rent for such month shall be pro-rated on a per diem basis based upon a period of 365 days.

 

Article 4
ALTERATIONS AND TENANT EQUIPMENT

 

4.1 Alterations.

 

The Tenant shall make no changes, additions, alterations or leasehold improvements of any nature whatsoever in or to the Premises or any part thereof (collectively, “Alterations”), without Landlord’s prior written consent (which may be granted or withheld in Landlord’s sole discretion if same impact on or affect structure, base building systems or the exterior of the Building and otherwise shall not be unreasonably withheld or delayed ) and Tenant shall not demolish or destroy the whole or any part of the Premises. The terms and provisions of Section 11.1(a) shall apply, mutatis mutandis , to any Alterations consented to by the Landlord.

 

4.2 Improvements.

 

(a) All Improvements shall immediately upon installation become the absolute property of Landlord, free and clear of any liens or encumbrances. Subject to subsections 4.2(b) and (c), upon the expiry or earlier termination of this Lease, all Improvements shall remain upon and be surrendered with the Premises as a part thereof without disturbance, molestation or injury and the same and any Tenant Equipment not removed by Tenant are the property of Landlord absolutely, free of any liens or encumbrances and without payment therefor to Tenant. In addition, Landlord will be entitled to all depreciation deductions, investment tax credits, deductions for taxes (other than Taxes paid by Tenant) and any other tax advantages resulting from the ownership of the Improvements.

 

(b) Landlord may, by notice to Tenant prior to or promptly after the expiry or earlier termination of this Lease, require the removal forthwith, at the expense of Tenant, of any or all of Tenant Equipment, Tenant’s other personal property and/or leasehold improvements and the repair forthwith of any damage to the Premises caused by such removal, such work to be done forthwith by or at the direction of Landlord and at the expense of Tenant. If such notice is given prior to the expiry or earlier termination of this Lease, such removal and repair shall be completed by such expiry or earlier termination.

 

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(c) Provided Tenant has paid the Rent hereby reserved and performed and observed all the covenants and conditions herein contained, Tenant shall have, at the expiry or earlier termination of this Lease, the right to remove Tenant Equipment and Tenant’s other personal property, provided that Tenant repairs by the expiry or earlier termination of this Lease, at its own expense, any damage to the Premises caused by such removal, such work to be done by or at the direction of Landlord and at the expense of Tenant.

 

(d) Tenant acknowledges and agrees that in the event that any Tenant Equipment or other personal property remains in the Premises after the expiry or earlier termination of this Lease, any such items may, at the option of Landlord and without obligation to compensate or reimburse Tenant, become the property of Landlord and Landlord may, in its sole discretion and without notice to Tenant, arrange for the removal and/or sale of such items and the proceeds of such sale after deducting all costs in connection therewith shall be applied towards any arrears of Rent owing by Tenant. All costs in connection therewith, not recovered from such sale shall be borne by Tenant in their entirety. The cost of removing and disposing of such property and repairing any damage to any of the Premises caused by such removal (together with interest at the Default Rate from the date of removal) shall be paid by Tenant to Landlord upon demand. Tenant acknowledges and agrees that such removal and/or sale shall not constitute distraint of such items.

 

(e) The provisions of this Section 4.2 shall survive the expiration or termination of the Term.

 

4.3 Signage.

 

Tenant shall neither erect nor modify any sign on the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld or delayed except if same affect the structure (or base building systems) of the Premises or are not in conformance with the exterior appearance of the Premises. All such signage shall comply with all applicable Laws. Upon expiry of the Term, Tenant shall be responsible for the cost of removal of such signage and repair of any damage caused by such removal and hereby indemnifies and saves harmless Landlord therefor.

 

4.4 Encroachments.

 

If any Alteration (including signage) made by Tenant shall (a) encroach upon any setback or any property, street or right-of-way adjoining the Premises, (b) violate the provisions of any restrictive covenant affecting the Premises, (c) hinder or obstruct any easement or right-of-way to which any of the Premises is subject and/or (d) impair the rights of others in, to or under any of the foregoing, Tenant shall, at its sole expense, promptly after receiving notice or otherwise acquiring knowledge thereof, in Landlord’s sole discretion either: (i) obtain from all necessary parties waivers or settlements acceptable to Landlord of all claims, liabilities and damages resulting from each such encroachment, violation, hindrance, obstruction or impairment, whether the same shall affect Landlord, Tenant or both, or (ii) take such action as Landlord shall deem necessary to remove all such encroachments, hindrances or obstructions and to end all such violations or impairments, including, if necessary, making further Alterations.

 

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Article 5
USE AND OCCUPANCY

 

5.1 Use.

 

Tenant shall use the Premises only for light manufacturing of electronic power supplies and for no other purpose without the express prior written consent of Landlord, which consent may be granted or withheld in Landlord’s sole discretion; however said consent shall not be unreasonably withheld.

 

5.2 Conduct of Business.

 

Tenant shall occupy the Premises from and after the Commencement Date and shall thereafter continuously conduct the business set out in Section 5.1 in the whole of the Premises throughout the Term in a reputable and first class manner.

 

5.3 Compliance.

 

Tenant shall comply with all Laws applicable to the Premises and will keep and maintain the Premises in compliance with all applicable Laws.

 

5.4 Easements.

 

Tenant shall promptly and at no expense to Landlord join with Landlord, from time to time at the request of Landlord with respect to Tenant’s interest in the Premises at no cost to Landlord: (a) to grant, in the ordinary course of business, easements, licenses, rights-of-way and other rights and privileges in the nature of easements; (b) to release, in the ordinary course of business, existing easements and appurtenances which benefit the Premises; (c) to dedicate or transfer unimproved portions of the Land for road, highway or other public purposes; (d) to cause any Leasehold Mortgagee to promptly execute and deliver, upon request from Landlord, any and all instruments, agreements, documents or other assurances which may be required from time to time to give effect to such grants; and (e) to execute and deliver any instrument, in form and substance required by Landlord, to make or confirm such grants or releases to any Person, with or without consideration.

 

Without limiting the foregoing and notwithstanding anything else contained herein, Tenant hereby accepts the Premises subject to the burden of Existing Easements.

 

5.5 Access and Control of Existing Easements.

 

Notwithstanding anything else contained herein or at law, but without limiting or reducing Tenant’s maintenance, repair or replacement obligations herein, Tenant acknowledges and agrees that Tenant shall not interfere with, tamper with or alter the Existing Easements in any respect. Landlord and its agents shall at all times have unrestricted access to the Existing Easements including, without limitation, to all pipes above, on, under or about the Premises and related appurtenances thereto (including underground tunnels and piping).

 

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5.6 Not to Cause a Nuisance or Waste.

 

Tenant covenants that it will not do or omit to do and will not permit to be done or omitted to be done, anything upon or in respect of the Premises, the doing or omission of which (as the case may be) shall in Landlord’s opinion be or result in a nuisance or an act of waste.

 

5.7 Loudspeakers, etc.

 

No loudspeakers, television, phonographs, radios or other devices shall be used in a manner so as to be heard or seen outside of the Premises without the prior consent of Landlord which consent may be withheld by Landlord in its sole discretion.

 

5.8 Environmental Matters.

 

Tenant agrees to comply with all Environmental Laws which may be applicable to the Premises. Without limiting the foregoing, Tenant shall not cause or permit or allow any Hazardous Substance to be brought upon, kept, used, or released in, under, from or about the Premises in violation of Environmental Laws. If,

 

(a) Tenant breaches the obligations stated in the preceding sentences, or

 

(b) the presence of any Hazardous Substance on the Premises from whatever cause or nature, including actions of third parties taken with or without the permission or knowledge of Tenant, results in contamination of the Premises, or any part thereof, or

 

(c) contamination of the Premises by any Hazardous Substance otherwise occurs, or

 

(d) any adjoining or neighbouring lands or lands other than the Premises are contaminated as a result of such breach or presence,

 

then Tenant shall indemnify, defend and hold Landlord, its agents, employees, directors, officers, legal representatives, successors and assigns, harmless from any and all claims, judgments, damages, penalties, fines, Costs, liabilities, stop order, control order or any other order issued under any Environmental Laws, regulations, or losses (including, without limitation, diminution in value of the Premises, damages for the loss of, or restriction on the use of, the Premises, and sums paid in settlement of claims, reasonable legal fees, consultant fees and expert fees) which arise during or after the Term as a result thereof. This indemnification of Landlord by Tenant includes, without limitation, costs incurred in connection with any investigation of site conditions or any cleanup, remedial, removal or restoration work required by any federal, provincial, or local governmental agency or political subdivision because of any Hazardous Substance present in or about the Premises, or any adjoining property or at any location other than the Premises, or the soil or ground water on or under or flowing from the Land. Without limiting the foregoing, if the presence of any Hazardous Substance on or about the Premises results in any contamination of any portion thereof, Tenant shall promptly take all actions at its sole expense as are necessary to return the Premises, or any adjoining property, to the condition existing prior to the introduction of or release of any such Hazardous Substance, subject to obtaining Landlord’s prior written consent to the actions to be taken by Tenant. Landlord may require its prior written consent to the selection of the contractors and other experts involved in the inspection, testing and removal or abatement activities, the scope of activities to be performed, the manner, the schedule for performance and method for performance of such activities, and such other matters as may be required or requested by Landlord for the continued use of the Premises and the safety of the Premises and all occupants thereof Tenant shall provide Landlord with such documentation and information reasonably requested by Landlord with respect to any inspection, testing, remediation, removal, abatement, or other activities undertaken by or on behalf of Tenant under this Section 5.8. The obligations and liabilities of Tenant herein shall survive expiration or termination of this Lease. Furthermore, if any such activities extend beyond the Term, Tenant shall pay to Landlord, in addition to any other amounts under this Section 5.8, rent for the Premises during such period in an amount equal to the amount which could have been received by Landlord for the use of the Premises during such period in the absence of contamination by such Hazardous Substance.

 

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5.9 Environmental Compliance.

 

In addition to the other obligations of Tenant in this Article 5, Tenant shall advise Landlord with respect to any inspection, visit, investigation or inquiry initiated or carried out by any regulatory authority or any claim made or threatened by any person against Landlord and/or Tenant or the Premises, relating to damage, contribution, cost recovery, compensation, loss or injury resulting from or claimed to result from any Hazardous Substance. Such advice shall be provided within three (3) Business Days of Tenant’s receipt of any notice or action initiated by the regulatory authority or any claim made or threatened, and shall include a complete description of the matters giving rise to the notice or action by the regulatory authority or any claim made or threatened, and any actions taken by Tenant with respect to them. Tenant will advise Landlord forthwith of any releases which are required to be reported to a governmental authority by any Environmental Laws, whether or not such releases have been reported, and any charges laid or pending against Tenant with respect to environmental matters, including a description of the circumstances giving rise to such releases or charges, as the case might be. For further clarification, Landlord is herewith given the right of access to perform all audits, assessments, evaluations, and reports respecting environmental performance and activities at the Premises, as may be reasonably necessary to enable Landlord to form a competent opinion on the level of compliance of Tenant with respect to relevant Environmental Laws and its obligations under this Lease.

 

5.10 Remediation by Landlord.

 

If Tenant fails to commence remediation of the Premises and any other affected lands as required in this Article 5 within a reasonable time after becoming aware of a breach of this Article, or fails to diligently and continuously proceed with remediation thereafter, in addition to Landlord’s other rights and remedies herein, Landlord shall have the right, at its sole option, to take all necessary steps to return the Premises and any other affected lands to the condition existing prior to the introduction of any such Hazardous Substance, at the sole cost of Tenant. All payments made and all costs incurred by Landlord under this Article 5 shall be reimbursed by Tenant within ten (10) Business Days after notice. In addition to any other rights and remedies available to Landlord, Landlord shall have the right, in respect of Tenant’s failure to make reimbursement of any amount as aforesaid, to deduct such amount from any amounts due and payable by Landlord hereunder.

 

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Article 6
UTILITIES AND REPAIRS

 

6.1 Utilities.

 

Tenant shall pay in a timely manner all water, sewer, electricity, gas, telephone or other communications, and any other utility charges related to the Premises, including, if applicable, the costs and expenses of providing utilities.

 

6.2 Maintenance, Repair and Replace.

 

Tenant shall at all times maintain, repair and if necessary replace the Premises as would a prudent owner of first class premises of the type, nature and quality of the Premises. Tenant shall take every other action necessary or appropriate for the preservation and safety of the Premises. Tenant shall promptly make all Alterations of every kind and nature, whether foreseen or unforeseen, which may be required to comply with the foregoing requirements of this Section 6.2 and subject to Section 4.2, Landlord may, but shall not be required to, make any such repairs or Alterations to the Premises, and Tenant shall, immediately upon demand, reimburse Landlord for the expenses incurred by Landlord (together with interest at the Default Rate from the date of demand) in effecting such repairs or Alterations. Furthermore, and notwithstanding Landlord’s rights provided by the immediately preceding sentence, Landlord shall not be required to make any Alteration, whether foreseen or unforeseen, or to maintain any of the Premises in any way, and Tenant hereby expressly waives any right which may be provided for in any Law now or hereafter in effect to make Alterations at the expense of Landlord or to require Landlord to make Alterations.

 

Article 7
TAXES AND SALES TAXES

 

7.1 Payment of Taxes.

 

Subject to Section 7.5, Tenant shall punctually pay and discharge or cause to be paid and discharged, as and when the same shall become due and payable, all Taxes. Tenant shall be deemed to have complied with the covenants hereof if payment of such Taxes shall have been made before assessment of any penalty or interest or before the same shall become a currently payable lien upon the Premises, and Tenant shall deliver to Landlord satisfactory evidence of payment within thirty (30) days after the date payment is due. Tenant shall also pay all special assessments and other like impositions amortized over the life of the improvement levied or imposed for improvements installed and assessed either prior to or during the Term. Without limiting the foregoing, the Tenant shall pay all Capital Taxes, as Additional Rent to Landlord at the times and in the manner required by the Landlord.

 

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7.2 Proration at Commencement and End of Term.

 

If the Term expires or otherwise terminates on other than the last day of a twelve (12) month period for which Taxes are assessed (a “Tax Year”), Taxes for the Tax Year in which the Term ends will be prorated between Landlord and Tenant, based on the most recent levy and most recent assessment. Such proration will be subsequently adjusted when the actual bills for Taxes for the Tax Year in which the Term ends become available. If the Term commences on other than the first day of a Tax Year, Taxes for the Tax Year in which the Term commences will be prorated between Landlord and Tenant when the actual bills for Taxes for the Tax Year in which the Term begins become available. The covenants set forth in this Section 7.2 shall survive the expiration or termination of the Term.

 

7.3 Sales Taxes.

 

Tenant shall throughout the Term, pay when due all Sales Taxes directly to Landlord. Landlord may estimate Sales Taxes on a monthly basis and Tenant shall pay same to Landlord in accordance with Section 3.2 herein. If in the event that any amount becomes payable by Tenant to Landlord as a result of a breach, modification or termination of this Lease, said amount payable shall be increased by an amount equal to any applicable Sales Taxes (including, without limitation, any harmonized sales tax) and Tenant shall pay such increased amount.

 

7.4 Business Taxes and Other Taxes of Tenant.

 

In addition to the Taxes payable by Tenant as hereinbefore set out, Tenant shall, pay to the lawful taxing authorities, or as Additional Rent to Landlord if Landlord is invoiced therefor by the taxing authority having jurisdiction, and shall discharge when the same become due and payable, all Business Taxes to the extent same may constitute a lien upon the Premises or for which Landlord may become liable, and whether in any case any such Business Taxes are rated, charged or assessed by any federal, provincial, municipal or other body during the Term.

 

7.5 Realty Taxes

 

(a) Notwithstanding the provisions of Section 7.1 permitting Tenant to pay and discharge all Taxes, Tenant shall pay as Additional Rent to Landlord, or to the relevant taxing authorities if Landlord so directs, and discharge in each year during the Term and within the times provided for by the taxing authorities, all realty taxes levied, rated, charged or assessed from time to time respectively, against the Premises or any part thereof.

 

(b) Tenant shall provide Landlord within 10 days after receipt by Tenant, a copy of all tax bills and assessment notices for the Premises or any part thereof and shall promptly deliver to Landlord receipts evidencing the payment of all such realty taxes payable to any such taxing authorities as aforesaid and to furnish such other information in connection therewith as Landlord reasonably requires.

 

(c) Unless Landlord has directed Tenant to pay the realty taxes to the relevant taxing authorities, Tenant shall pay the realty taxes according to estimates or revised estimates made by Landlord from time to time in respect of each calendar year during the Term (a “Year”). Tenant’s payments will be made in advance on the first day of each month in monthly amounts and for such periods as determined by Landlord. Until such time as Landlord advises otherwise, realty taxes payable for each Year shall be payable in 9 equal monthly installments, commencing on January 1 in each Year and ending on September 1 in each Year, subject to a pro rata adjustment for the first and last years of the Term to reflect the fact that the Term will not commence on January 1 or end on September 30.

 

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(d) Unless Landlord directs Tenants to pay realty taxes directly to the taxing authorities and provided that Tenant complies with its preceding obligations in this Section to pay the realty taxes to Landlord, Landlord covenants to pay the realty taxes to the relevant taxing authorities.

 

(e) If during the Term, the method of taxation is altered so that the whole or any part of the realty tax is now levied, rated, assessed or imposed on real estate and improvements are levied, assessed, rated or imposed wholly or partially as a capital levy or on the rents received or otherwise, or if any tax, assessment, levy, imposition or charge, in lieu thereof shall be imposed upon Landlord, then all such taxes, assessments, levies, impositions and charges shall be included within Tenant’s obligation to pay realty taxes as set out in this Article 7.

 

(f)    (i) Landlord may defer payment of realty taxes, or defer compliance of any relevant law in connection with the levying of any such realty taxes, in each case, to the fullest extent permitted by law, so long as it shall diligently prosecute any contest, appeal or assessment on which such tax is based. Tenant shall cooperate with Landlord in respect of any such contest, appeal or assessment and shall provide Landlord with all relevant information, documents and consents required by Landlord.

 

(ii) Tenant may, with the prior written consent of Landlord, appeal or contest the assessment of realty taxes in respect of the Premises, in each case, to the fullest extent permitted by law, so long as it shall diligently prosecute any contest, appeal or assessment on which such tax is based. If Tenant obtains Landlord’s written consent, Tenant will deliver to Landlord whatever security for the payment of realty taxes Landlord considers advisable and will keep Landlord informed of its progress from time to time and upon the request of Landlord.

 

Article 8
INSURANCE

 

8.1 Maintenance of Policies.

 

Tenant shall maintain the following insurance on or in connection with the Premises at Tenant’s expense:

 

(a) Insurance against physical loss or damage to the Improvements and Tenant Equipment as provided under a standard “All Risk” property policy including but not limited to flood (if the Premises are in a flood zone) and earthquake coverage in amounts not less than the actual replacement cost of the Improvements and Tenant Equipment. Such policies shall contain replacement cost and agreed amount endorsements and shall contain deductibles of not more than $100,000.00 per occurrence in respect of earthquake coverage; and not more than $25,000.00 per occurrence in respect of all other coverages;

 

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(b) Commercial general liability insurance against claims for personal and bodily injury, death or property damage occurring on, in or as a result of the use of the Premises, in an amount not less than $10,000,000.00 per occurrence/annual aggregate and all other coverage extensions that are usual and customary for properties of this size and type; provided, however, that Landlord shall have the right to require such higher limits as may be reasonable and customary for properties of this size and type;

 

(c) Comprehensive Automobile Liability covering all owned, non-owned and hired vehicles with limits of not less than $2,000.000.00 combined single limit;

 

(d) Business income/interruption insurance on an actual loss sustained basis with a period of indemnity not less than two (2) years from the time of loss;

 

(e) During any period in which Alterations or restorations, the cost of which, in the aggregate, is in excess of $500,000.00 per project at the Premises are being undertaken, (i) builder’s risk insurance (on a completed value, non-reporting basis) against “all risks of physical loss,” including collapse and transit coverage, with deductibles not to exceed $25,000.00, in non-reporting form, covering the total replacement cost of work performed and equipment, supplies and materials furnished in connection with such construction or repair of Improvements or Tenant Equipment, together with “soft costs” and such other endorsements as Landlord may reasonably require or equivalent insurance coverage under property insurance policies, and (ii) general liability, worker’s compensation and automobile liability insurance with respect to the Improvements being constructed, altered or repaired; and

 

(f) Such other insurance on or in connection with any of the Premises as Landlord may reasonably require, which at the time is commonly obtained in connection with properties similar to the Premises.

 

8.2 Insurance Providers.

 

The insurance required by Section 8.1 shall be written by companies approved by Landlord acting reasonably. The insurance policies (a) shall be for such terms as Landlord may reasonably approve, (b) shall be in amounts sufficient at all times to satisfy any coinsurance requirements thereof, (c) shall name Landlord and Tenant as additional named insureds, as their respective interests may appear, (d) shall contain an agreement by the insurer to give at least thirty (30) days’ prior written notice to all additional insureds of any intention to cancel, cause to lapse, materially diminish or deny coverage, and (e) shall be issued specifically in respect of the Premises and not on a blanket or general policy basis. If such insurance or any part thereof shall expire, be withdrawn, become void, voidable, unreliable or unsafe for any reason, including a breach of any condition thereof by Tenant or the failure or impairment of the capital of any insurer, or if for any other reason whatsoever such insurance shall become unsatisfactory to Landlord, acting reasonably, Tenant shall immediately obtain new or additional insurance reasonably satisfactory to Landlord. Tenant covenants and agrees that certificates of insurance for all insurance required to be maintained by it pursuant to this Article 8 shall be delivered to Landlord upon request by Landlord to Tenant. If Tenant fails to take out or keep in force any policy of insurance referred to in Section 8.1 hereof, Landlord may do so and pay the premium and in that event, Tenant will pay to Landlord the amount so paid as Additional Rent and it will be due and payable on the first day of the month following the payment by Landlord.

 

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8.3 Premiums.

 

Tenant shall pay as they become due all premiums for the insurance required by Section 8.1, shall renew or replace each policy and deliver to Landlord evidence of the payment of the full premium therefor or instalment then due at least ten (10) days prior to the expiration date of such policy, and shall promptly deliver to Landlord certificates of the insurance policies evidencing the existence of all policies.

 

8.4 Insurable Value.

 

Tenant shall have the replacement cost and insurable value of the Improvements determined from time to time as required by the replacement cost and stated amount endorsements and shall deliver to Landlord the new replacement cost and stated amount endorsement or certificate evidencing such endorsement promptly upon Tenant’s receipt thereof.

 

8.5 Compliance with Policy Terms.

 

Tenant shall promptly comply with and conform to (a) all provisions of each insurance policy required by this Article 8, and (b) all requirements of the insurers thereunder applicable to Landlord, Tenant or any of the Premises or to the use, manner of use, occupancy, possession, operation maintenance, alteration or repair of any of the Premises, even if such compliance necessitates Alterations or results in interference with the use or enjoyment of any of the Premises.

 

8.6 No Additional Policies.

 

Tenant shall not carry separate insurance concurrent in form or contributing, in the event of a Casualty or in the event of injury to or death of any person, with that required in this Article 8 unless (a) Landlord is included therein as a named insured, with loss payable as provided herein, and (b) such separate insurance complies with the other provisions of this Article 8. Tenant shall immediately notify Landlord of such separate insurance and shall deliver to Landlord certificates therefor.

 

8.7 Waivers.

 

All policies shall contain effective waivers by the carrier against all claims for insurance premiums against Landlord and its mortgagee and contain full waivers of subrogation against Landlord and its mortgagee.

 

8.8 Use Not To Affect Insurance.

 

Tenant covenants and agrees that it will not do or permit or omit to be done anything upon the Premises or the Lands or any part thereof whereby any insurance policy shall be impaired or cancelled or the Premises rendered uninsurable.

 

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Article 9
DAMAGE OR DESTRUCTION

 

9.1 Effect of Damage or Destruction.

 

Neither this Lease nor the Basic Rent or other Rent payable by Tenant hereunder will be affected by any Casualty. In the event of any such Casualty, Tenant shall promptly, at its sole expense, undertake the repair and restoration of affected Improvements to at least their condition existing prior to the Casualty.

 

9.2 Insurance Proceeds.

 

During the Term, if any Casualty occurs, Tenant shall give Landlord immediate notice thereof. Except as specifically provided for in the following sentence, Landlord is hereby authorized to adjust, collect and compromise, in its discretion and upon notice to Tenant (except that no notice to Tenant shall be required if an Event of Default has occurred and is continuing), all claims under any of the insurance policies required by Article 8 (except public liability insurance claims payable to a Person other than Tenant or Landlord) and to execute and deliver on behalf of Tenant all necessary proofs of loss, receipts, vouchers and releases required by the insurers. Provided that no Event of Default has occurred and is continuing, Tenant shall be entitled to participate at its own expense with Landlord in any adjustment, collection and compromise of insurance proceeds payable in connection with a Casualty. Tenant agrees to sign, upon the request of Landlord, all such proofs of loss, receipts, vouchers and releases. If Landlord so requests, Tenant shall adjust, collect and compromise any and all claims, and Landlord shall have the right to join with Tenant therein. Landlord shall have the right to prosecute or contest, or to require Tenant to prosecute or contest, any such claim, adjustment, settlement or compromise. All proceeds of any insurance required under Article 8 (excluding liability insurance claims payable to third parties) shall be payable to Landlord and Tenant jointly; and, with respect to the insurance proceeds received pursuant to Section 8(l)(d), such proceeds shall be applied to Rent next due and owing. Each insurer is hereby authorized and directed to make payment under such policies, including return of unearned premiums, directly to Landlord and Tenant jointly, and Tenant hereby appoints Landlord Tenant’s attorney-in-fact to endorse any draft therefor.

 

9.3 Application of Insurance Proceeds.

 

Any insurance proceeds shall be applied first to reimburse Landlord for all costs and expenses, including reasonable solicitors’ fees, incurred by Landlord in connection with the collection of such insurance proceeds. The balance of any insurance proceeds received by Landlord with respect to an insured Casualty shall, in accordance with Article 11, be applied by the Landlord to pay for repairs, reconstruction, restoration or replacements necessitated by the Casualty, provided that: (a) no Event of Default shall exist hereunder; (b) the proceeds received by Landlord (together with any other funds delivered by Tenant to Landlord for such purpose) shall be sufficient, in Landlord’s judgment, to pay for any restoration necessitated by the Casualty; and (c) such restoration can be completed, in Landlord’s judgment, at least ninety (90) days prior to the end of the Term. Notwithstanding the foregoing, in the event the Casualty occurs within the last twelve (12) months of the Term, Landlord shall have the right, in its sole discretion, to terminate the Term effective retroactively to the occurrence of the Casualty, in which event all insurance proceeds payable as a result of the Casualty shall be paid to, and become the sole property of, Landlord. Landlord will have no obligation to see to the proper application of any insurance proceeds paid over to Tenant, nor will any such proceeds received by Landlord bear interest or be subject to any other charge for the benefit of Tenant.

 

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Article 10
WAIVERS AND INDEMNITIES

 

10.1 Tenant’s Waiver and Indemnification.

 

Tenant hereby waives all claims against Landlord for damages to any property or injury to or death of any person in, upon or about the Premises arising at any time and from any cause other than solely by reason of the willful misconduct or negligence of Landlord, its employees or agents, and Tenant shall indemnify and save harmless Landlord from and against all costs, expenses, payments, liabilities, losses, damages, injunctions, suits, actions, fines penalties, claims and demands of every kind or nature whatsoever, including reasonable counsel fees and disbursements and all other Costs incurred by Landlord or personal or physical injury to any person, which may be made or brought against Landlord or which Landlord may suffer or incur arising out of, relating to, or in connection with:

 

(a) the use or occupation of or the conduct or management of any business from or anything whatsoever done in or about the Premises;

 

(b) any breach or default on the part of Tenant in the performance and observance of any of the agreements, terms, covenants or conditions of this Lease on Tenant’s part to be performed and observed;

 

(c) failure on the part of the Tenant to comply with any laws, by-laws, ordinances and regulations, requirements, orders, directions, notices or rules of any federal, provincial or municipal authority, agency or department having jurisdiction, including non-compliance attributable to events, occurrences or circumstances occurring or existing prior to the Commencement Date;

 

(d) any damage to any person or property occurring in, on or about the Premises; or,

 

(e) any act of negligence of Tenant;

 

hereinafter collectively referred to as “Claims”.

 

Tenant’s obligation under this Section 10.1 to indemnify and hold Landlord harmless shall be limited to the sum that exceeds the amount of insurance proceeds, if any, received by Landlord in respect of such Claim.

 

Landlord shall have the right at its own expense and option to be represented by counsel of its own choice in defense of any such Claim and in negotiations for settlement in connection with any such Claim.

 

.

 

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The provisions of this Section 10.1 shall survive the termination of this Lease with respect to any damage, injury or death occurring prior to such termination.

 

Article 11
RESTORATION

  

11.1 Restoration.

 

If the Building or the Premises are damaged or destroyed either in whole or in part by fire or any other occurrence, this Lease shall nevertheless continue in full force and effect and there shall be no abatement of any item of Basic Rent and Additional Rent except as is expressly hereinafter in this Article 11 provided and in the event of such damage or destruction the following provisions shall apply:

 

(a) Insured Damage to Premises

 

If the damage or destruction is such so as to render the whole or any part of the Premises unusable or untenantable for the purpose of Tenant's use and occupancy thereof, the Landlord shall deliver to the Tenant within sixty (60) days following the occurrence of such damage or destruction the written opinion of the Landlord's architect, determined reasonably, as to whether or not the Premises is capable of being repaired within one hundred and eighty (180) days following the delivery of such opinion.

 

If this Lease is not terminated by the Landlord as provided for hereunder, then the Landlord, to the extent of the insurance proceeds which the Landlord receives, and to the extent that any Mortgagee entitled to be paid such insurance proceeds consents to the use of the same for repair of such damage or destruction, shall diligently proceed to repair any defects in the structure of the Building and exterior walls of the Building and such electrical, mechanical and drainage equipment and systems which form a part of the Building and the Landlord shall further repair such damage to the Premises (excluding all leasehold improvements). The Tenant shall, as soon as is practicable but without interfering with the Landlord's repairs as outlined above, diligently proceed to perform such repairs as are the Tenant's responsibility pursuant to this Lease.

 

If, in the opinion of the Landlord's architect, the Premises are not capable of being repaired as aforesaid within one hundred and eighty (180) days following the delivery of such opinion or, if immediately prior to the occurrence of such damage, the Tenant was not using substantially all of the Premises for the purposes permitted by this Lease or as otherwise required pursuant to this Lease or if the Tenant was, at the time of such damage, in breach of this Lease and had failed, within fifteen (15) days after notice of such default, to have commenced to remedy such default, the Landlord may, at its sole option, elect by written notice, given to the Tenant within ninety (90) days after such occurrence, to terminate this Lease, whereupon, the Tenant shall immediately surrender possession of the Premises to the Landlord and Basic Rent and Additional Rent and all other payments for which the Tenant is liable pursuant hereto shall be apportioned to the effective date of such damage and destruction.

 

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If the damage is such, so as to render the whole or any part of the Premises unusable in whole or in part for the purpose of the Tenant's use and occupancy as permitted hereby and if, immediately prior to the occurrence of such damage, the Tenant was using substantially all of the Leased Premises for the purposes as permitted by or as otherwise required pursuant to the terms of this Lease, then the Basic Rent and Additional Rent payable hereunder shall abate to the extent that the Tenant's use and occupancy of the Premises is, in fact, thereby diminished, which determination shall be made by the Landlord's architect, acting reasonably, but in its sole discretion, until the earlier of the thirtieth (30th) day after the Premises are ready for the Tenant to commence its repairs to the Leased Premises as determined by the Landlord's architect, or, the date on which the Tenant first commences to conduct its business in any part of the Premises which have been damaged following the date of the occurrence of such damage or destruction.

 

The respective obligations of the Landlord and the Tenant with respect to the repair of the Premises following any damage or destruction as aforesaid shall be performed in accordance with all applicable obligations to repair contained in this Lease and shall be performed with all reasonable speed. The Tenant acknowledges that the obligations of the Tenant to repair the Premises after such damage or destruction as aforesaid or otherwise shall be performed at the Tenant's sole cost without any contribution thereto by the Landlord whether or not any damage or destruction was caused by the Landlord's fault or negligence and whether or not the Landlord has at any time made any contribution to the cost of supply, installation or construction of any of the leasehold improvements in the Premises. In any event, within thirty (30) days after the Landlord has completed its repairs to the Premises as aforesaid, the Tenant shall complete its repairs to the Premises and shall fully fixture the premises and recommence the operation of the Tenant's business as permitted and required pursuant to the terms of this Lease.

 

(b) Uninsured Damage of the Leased Premises

 

If there is damage or destruction to the Premises, and the Premises are not reasonably capable of being repaired within one hundred and eighty (180) days following the delivery of the written opinion of the Landlord’s architect as aforesaid or which has been caused by an occurrence against which the Landlord is not insured or if the cost of repairs of which would be in excess of the extent to which insure proceeds are receivable pursuant to this Lease, then the Landlord may, at its option, to be exercised by written notice given to the Tenant within ninety (90) days after such occurrence, terminate this Lease, whereupon, the Tenant shall immediately surrender possession of the Premises to the Landlord and Basic Rent and Additional Rent and all other payments for which the Tenant is liable pursuant to this Lease shall be apportioned to the effective date of such termination. If this Lease is not terminated as aforesaid, then the parties shall repair as hereinbefore provided and there shall be no abatement of any portion of the Basic Rent or Additional Rent unless the damage or destruction is Insured Damage.

 

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If there is damage or destruction to the Building or the Premises and if this Lease is not terminated pursuant hereto, the Landlord, in performing its repairs to the Building or the Premises as required hereby shall not be obligated to repair or rebuild in accordance with the plans or specifications for the Building or the Premises as they existed prior to such damage or destruction and the Landlord may repair or rebuild the same in accordance with any plans and specifications chosen by the Landlord in its sole and absolute discretion provided that the Tenant's use and occupancy of and access to the Premises and the general overall quality of the Building are not materially detrimentally affected by any difference in plans, specifications or forms of the Premises or the Building.

 

The decision of the Landlord's architect as to the time within which the Building or the Premises can or cannot be repaired, the state of tenantability of the Premises and as to the date on which the Landlord's Work of repair is completed shall be final and binding upon the parties hereto.

 

11.2 Excess Net Proceeds – Casualty

 

Any Net Proceeds of a Casualty remaining after restoration of the Premises shall be retained by Landlord and applied to the next accruing installment(s) of Rent. If such Net Proceeds exceed the remaining Rent payable during the Term, such excess shall be retained by, and be the sole property of, Landlord.

 

Article 12
ASSIGNMENT, SUBLETTING AND FINANCING

 

12.1 Assignment and Subletting.

 

Tenant shall not sell, assign or transfer this Lease or any interest herein, sublet or permit the occupancy or use by others of the Premises or any part thereof, or part with possession of the Premises or any part thereof, or allow any transfer hereof by operation of law or otherwise (collectively, a “Transfer”), without the prior written consent of Landlord, which Landlord will not unreasonably withhold or delay. Any Transfer which is not in compliance with the provisions of this Article 12 shall, at the option of Landlord, and without limiting any other remedies of Landlord, be void and of no force or effect. If the Tenant intends to effect a Transfer, then the Tenant shall give prior written notice to the Landlord of such intent specifying the nature of the Transfer and the name of the proposed transferee and shall provide such information with respect to the proposed Transfer and the transferee as the Landlord may reasonably require. Tenant shall deliver to Landlord upon receipt from time to time throughout the Term or thereafter, any consideration received as a result of any Transfer, which shall include the difference, if any, between the amount of rent and similar payments received by Tenant as a result of such Transfer and the amount of Rent payable hereunder. Tenant shall cause the subtenant, assignee or transferee to execute and deliver to the Landlord an agreement to be bound by the terms and provisions of this Lease as if the subtenant (to the extent of the subleased premises and save for the payment of Basic Rent), assignee or transferee had executed this Lease in the place and stead of the Tenant.

 

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Landlord will, within 30 days after having received written notice from the Tenant as set out above, notify Tenant in writing either that:

 

(a) it consents or does not consent to the Transfer; or

 

(b) it elects to cancel this Lease in preference to giving its consent. If Landlord elects to cancel this Lease, Tenant will notify Landlord in writing within 15 days thereafter of Tenant’s intention either to refrain from such Transfer or to accept the cancellation of this Lease. If Tenant fails to advise Landlord within such 15 day period or if it advises Landlord that it accepts Landlord’s cancellation of this Lease, this Lease will be terminated upon the last day of the month that follows the 30 th day following the date that Landlord advised Tenant in writing of its decision to cancel this Lease and Tenant will, on such date, deliver up possession of the Premises in accordance with all of the provisions of this Lease relating to the surrender of the Premises at the expiration of the Term and all Rent shall be adjusted to the date of such termination. If Tenant advises Landlord that it intends to refrain from such Transfer, Landlord’s election to cancel this Lease will become null and void in such instance.

 

12.2 No Release.

 

The consent by Landlord to any Transfer shall not be construed as a waiver or release of Tenant from liability for the performance of all covenants and obligations to be performed by Tenant under this Lease, and Tenant shall remain liable therefor, nor shall the collection or acceptance of Rent from any assignee, subtenant or occupant constitute a waiver or release of Tenant from any of its obligations or liabilities under this Lease. Any consent given pursuant to this Article 12 shall not be construed as relieving Tenant from the obligation of obtaining Landlord’s prior written consent to any subsequent assignment, subletting or other Transfer.

 

12.3 Equity Transfers.

 

(a) If Tenant is a partnership, a withdrawal or change, whether voluntary, involuntary or by operation of law or in one or more transactions, of partners which results in a change of control or transfer of a controlling interest in Tenant shall be deemed a voluntary assignment of this Lease and subject to the provisions of this Article 12. If Tenant is a corporation, any dissolution, merger, consolidation or other reorganization of Tenant, or the sale, transfer or redemption of a controlling interest of the capital stock of Tenant in one or more transactions shall be deemed a voluntary assignment of this Lease and subject to the provisions of this Article 12.

 

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  (b) Neither this Lease nor any interest herein nor any estate created hereby shall pass by operation of law or otherwise to any trustee, custodian or receiver in bankruptcy of Tenant or any assignee under an assignment for the benefit of creditors of Tenant.

 

12.4 Financing.

 

Tenant shall not, without Landlord’s prior written consent, which consent may be granted or withheld in Landlord’s sole discretion, execute or deliver any Leasehold Mortgage securing any indebtedness or other obligation of Tenant or any other Person.

 

12.5 Dealings by Landlord.

 

Landlord may sell, transfer, charge, encumber or otherwise deal with the Land or any portion thereof or any interest of Landlord therein, in every case without the consent of Tenant, and without restriction. To the extent that any purchaser or transferee from Landlord has become bound by the covenants and obligations of Landlord under this Lease, Landlord shall, without further written agreement, be freed and relieved of liability with respect to such covenants and obligations.

 

12.6 Subordination and Attornment.

 

Tenant acknowledges that this Lease is, at the option of any mortgagee or charge, subject and subordinate to any and all mortgages or charges (including deeds of trust and mortgage securing bonds, all indentures supplemental thereto or any other instruments of financing, refinancing or collateral financing) which may now or hereafter affect the Land or Improvements, or any part thereof, and to all renewals, modifications, consolidations, replacements and extensions thereof, provided the holder of such mortgage or charge enters into a non-disturbance agreement with the Tenant pursuant to which and so long as the Tenant shall not be in default under this Lease, the Tenant shall be entitled to remain undisturbed in possession of the Premises pursuant to this Lease, notwithstanding the exercise of any rights or remedies by the holder of the mortgage or charge. Tenant agrees to execute promptly any certificate or instrument in confirmation of such subordination and will, if requested by Landlord or by any such mortgagee or chargee, attorn to such mortgagee or chargee, and Tenant hereby constitutes Landlord, its agent and attorney for the purpose of executing any such certificate or instrument.

 

Article 13
END OF TERM

 

13.1 Surrender.

 

Subject to Section 4.2, upon the expiration or earlier termination of this Lease (other than pursuant to the exercise of a purchase option), Tenant shall peaceably leave and surrender the Premises to Landlord in the same condition in which the Premises were at the commencement of this Lease except for reasonable wear and tear and as repaired, rebuilt, restored, altered, replaced or added to as permitted or required by any provision of this Lease. The covenants set forth in this Section 13.1 shall survive the expiration or termination of the Term.

 

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13.2 Holding Over.

 

If Tenant holds over after the end of the Term without a written agreement providing therefor, Tenant shall be deemed to be a tenant from month to month, at a monthly rent, payable in advance, equal to 200% of the Rent payable during the last year of the Term, and Tenant shall be bound by all of the other terms, covenants and agreements of this Lease as the same may apply to a month-to-month tenancy. Nothing contained herein shall be construed to give Tenant the right to hold over at any time, and Landlord may exercise any and all remedies at law or in equity to recover possession of the Premises, as well as any damages incurred by Landlord due to Tenant’s failure to vacate the Premises and deliver possession to Landlord as provided herein.

 

13.3 Survival of Obligations.

 

Upon the termination of this Lease:

 

(a) all claims, causes of action or other outstanding obligations remaining or being unfulfilled as at the date of termination;

 

(b) all of the provisions of this Lease relating to the obligations of any of the parties to account to or indemnify the other and to pay to the other any monies owing as at the date of termination in connection with this Lease; and

 

(c) all provisions which are stated to survive;

 

shall survive such termination.

 

Article 14
LIENS AND ESTOPPEL CERTIFICATES

 

14.1 Construction Liens.

 

(a) Tenant shall, throughout the term of the Lease at its own expense, cause any and all statutory liens, construction liens and other claims for labour, services or materials alleged to have been supplied to, or to have been charged by or for Tenant or anyone on its behalf which may be registered against, or otherwise form a lien against the Premises, to be paid, satisfied, discharged, released, cancelled and vacated within the earliest of: (i) the tenth (10th) day after Landlord notifies Tenant that a claim for any lien has been made; or (ii) the tenth (10th) day after Tenant in any other manner receives actual or constructive notice that a lien is claimed.

 

(b) If Tenant bona fide disputes the validity, correctness, or amount of any lien, Tenant may vacate, discharge or otherwise dispose of the lien and shall be entitled to defend against any claim for lien in proceedings in any court having jurisdiction provided that it: (i) prosecutes such defence with all due diligence; and (ii) posts such bond as may be required or pays into court the amount necessary to discharge the lien from title and such costs as the court may direct, and registers all documents necessary to have the lien or other claim vacated or provides such other security to protect the interest of Landlord in the Premises as Landlord considers sufficient.

 

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(c) At any time when work is being performed or material supplied to the Premises for or on account of Tenant, Tenant shall hold back such funds for such time as is required by any law.

 

(d) Landlord and Tenant agree that any work done in the Premises during the Term by or on behalf of Tenant shall not be done and shall be deemed not to have been done at the request of Landlord. If any contractor with respect to any Work gives notice to Landlord pursuant to Section 19 of the Construction Lien Act (Ontario), Landlord shall have the right to refuse to assume responsibility.

 

14.2 Estoppel Certificates.

 

Tenant agrees that at any time and from time to time (but on not less than ten (10) Business Days’ prior request by Landlord), it will execute, acknowledge and deliver to Landlord and such other Person(s) as may be reasonably requested, a certificate indicating any or all of the following: (a) the date on which the Term commenced and the date on which it is then scheduled to expire; (b) that this Lease is unmodified and in full force and effect (or, if there have been modifications, that this Lease is in full force and effect, as modified, and stating the date and nature of each modification); (c) the date, if any, through which Basic Rent has been paid; (d) that no Event of Default exists which has not been cured, except as to defaults stated in such certificate; (e) that the responding party has no existing defenses or set-offs to enforcement of this Lease, except as specifically stated in such certificate; and (f) such other matters as may be reasonably requested by the requesting party. Any such certificate may be relied upon by the requesting party and, by any prospective purchaser of Landlord’s reversionary interest in the Premises, or if Tenant is the requesting party, by any present or prospective holder of a Leasehold Mortgage or assignee of Tenant’s interest under this Lease.

 

Article 15
DEFAULTS AND REMEDIES

 

15.1 Defaults by Tenant.

 

Each of the following events will constitute an “Event of Default” under this Lease:

 

(a) Failure to Pay Rent . Tenant fails to pay Basic Rent or any other Rent payable by Tenant under the terms of this Lease within five (5) Business Days following notice thereof.

 

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(b) Failure to Perform Other Obligations . Tenant breaches or fails to comply with any provision of this Lease applicable to Tenant other than a covenant to pay Rent, and such breach or noncompliance continues for a period of fifteen (15) days after notice thereof from Landlord to Tenant; or, if such breach or noncompliance cannot reasonably be cured but is capable of cure within such fifteen (15) day period, Tenant does not commence to cure such breach or noncompliance within such fifteen (15) day period or does not thereafter pursue such cure in good faith to completion. Notwithstanding anything in the foregoing to the contrary, the terms of this Section 15.1(b) shall not apply with respect to any breach or noncompliance for which a cure period is specifically set forth in this Lease or for which an Event of Default is otherwise provided under this Article 15 or which cannot be cured.

 

(c) Execution and Attachment Against Tenant . Tenant’s interest under this Lease or in the Premises is taken upon execution or by other process of law directed against Tenant, or is subject to any attachment by any creditor or claimant against Tenant.

 

(d) Bankruptcy or Related Proceedings . Tenant files a petition in bankruptcy or insolvency, or for reorganization or arrangement under any bankruptcy or insolvency Laws, or voluntarily takes advantage of any such Laws by answer or otherwise, or dissolves or makes a general assignment for the benefit of creditors, or involuntary proceedings under any such Laws or for the dissolution of Tenant are instituted against Tenant, or a receiver or trustee is appointed for the Premises or for all or substantially all of Tenant’s property.

 

(e) Abandonment . The Premises shall have been abandoned for a period of at least five (5) Business Days.

 

(f) Dissolution . Tenant shall be wound up, liquidated or dissolved or proceedings towards its winding up, liquidation or dissolution are commenced.

 

(g) Leasehold Mortgages . A failure by Tenant to perform or observe, or a violation or breach of, or a misrepresentation in, any provision of any Leasehold Mortgage or any other document between Tenant and the holder of the Leasehold Mortgage, if such failure, violation, breach or misrepresentation gives rise to a default beyond any applicable cure period with respect to any loan secured by a Leasehold Mortgage.

 

(h) Licenses and Permits . A failure by Tenant to maintain in effect any license or permit necessary for the use, occupancy or operation of the Premises in accordance with this Lease.

 

(i) Operations . A failure by Tenant to occupy the whole of the Premises or to continuously conduct its normal operations therein.

 

(j) Transfer . The breach or violation by Tenant of any of the terms or conditions set forth in Article 12 of this Lease.

 

(k) Use . The breach or violation of Tenant of any of the terms or provisions of Section 5.1 of this Lease concerning Tenant’s use of the Premises.

 

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15.2 Landlord’s Remedies.

 

If any Event of Default occurs, the then current month’s Rent together with Rent for the three (3) months next ensuing shall immediately become due and payable and Landlord will have the right, at Landlord’s election, then or at any later time while such Event of Default is continuing, to exercise any one or more of the remedies described below. Exercise of any of such remedies will not preclude the concurrent or subsequent exercise of any other remedy provided for in this Lease or otherwise available to Landlord at law or in equity:

 

(a) Cure by Landlord . Landlord may, at Landlord’s option but without obligation to do so, and without releasing Tenant from any obligations under this Lease, make any payment or take any action as Landlord deems necessary or desirable to cure any Event of Default in such manner and to such extent as Landlord deems necessary or desirable, provided that, prior to making any such payment or taking any such action, Landlord notifies Tenant of Landlord’s intention to do so and affords Tenant at least ten (10) days (or such shorter period as is reasonable under the circumstances) in which to make such payment or take such action, provided however, if a notice was provided by Landlord pursuant to Section 15.1(b) hereof no further notice need be given. Tenant will pay Landlord, upon demand, all advances and Costs of Landlord in connection with making any such payment or taking any such action, together with interest at the Default Rate from the date of payment of any such advances and Costs by Landlord.

 

(b) Termination of Lease and Damages . Landlord may terminate this Lease, effective at such time as may be specified by notice to Tenant, and demand (and, if such demand is refused, recover) possession of the Premises from Tenant. In such event, Landlord will be entitled to recover from Tenant, as damages for loss of bargain and not as a penalty, an aggregate sum equal to:

 

(i) all unpaid Basic Rent and other Rent for any period prior to the termination date of this Lease (including interest from the due date to the date of the award at the Default Rate); plus

 

(ii) the present value at the time of termination (calculated by discounting on a monthly basis at a discount rate equal to the bid yield rate quoted by the Bank of Canada in Government of Canada Bonds offered at the time of such calculation having a maturity closest to the date on which the Term would have expired but for such termination) of the amount, if any, by which (1) the aggregate of the Basic Rent and all other Rent payable by Tenant under this Lease that would have accrued for the balance of the Term after termination, exceeds (2) the amount of such Basic Rent and other Rent which could reasonably be recovered less customary leasing commissions, reasonable tenant improvements, and other reasonable costs of leasing), if any, by reletting the Premises for the remainder of the Term at the then-current fair rental value; plus

 

(iii) interest on the amount described in (ii) above from the termination date to the date of the award at the Default Rate.

 

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In lieu of damages calculated in the manner set forth in the preceding sentence, Landlord may, at its option, to the extent permitted by applicable Laws, recover from Tenant, as damages for loss of bargain and not as a penalty, an aggregate sum equal to:

 

(A) all unpaid Basic Rent and other Rent for any period prior to the termination date of this Lease (including interest from the due date to the date of the award at the Default Rate); plus

 

(B) the aggregate of Basic Rent and all other Rent under this Lease that would have accrued for the balance of the Term after termination.

 

For purposes of calculating future Basic Rent under this Section 15.2(b), Basic Rent for the balance of the Term shall be deemed to equal the then-existing Basic Rent payable by Tenant.

 

(c) Repossession and Reletting . Landlord may re-enter and take possession of all or any part of the Premises, without additional demand or notice, and repossess the same and expel Tenant and any party claiming by, through or under Tenant, and remove the effects of both using such force for such purposes as may be necessary, without being liable for prosecution for such action or being deemed guilty of any manner of trespass, and without prejudice to any remedies for arrears of Rent or right to bring any proceeding for breach of covenants or conditions. No such re-entry or taking possession of the Premises by Landlord will be construed as an election by Landlord to terminate this Lease unless a notice of such intention is given to Tenant. No notice from Landlord or notice given under a forcible entry and detainer statute or similar Laws will constitute an election by Landlord to terminate this Lease unless such notice specifically so states. Landlord reserves the right, following any re-entry or re-letting, to exercise its right to terminate this Lease by giving Tenant such notice, in which event the Lease will terminate as specified in such notice. After recovering possession of the Premises, Landlord may, at its option, relet the Premises on commercially reasonable terms and conditions. Landlord may make such repairs, alterations or improvements a landlord considers appropriate to accomplish such re-letting, and Tenant will reimburse Landlord upon demand for all reasonable Costs and expenses, including reasonable solicitors’ fees, which Landlord may incur in connection with such re-letting. Landlord may collect and receive the rents for such re-letting but Landlord will in no way be responsible or liable for any inability to relet the Premises or to collect any rent due upon such re-letting. Regardless of Landlord’s recovery of possession of the Premises, so long as this Lease is not terminated, Tenant will continue to pay, on the dates specified in this Lease, the Basic Rent and other Rent which would be payable if such repossession had not occurred, less a credit for the net amounts, if any, actually received by Landlord through any re-letting of the Premises.

 

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15.3 Bankruptcy Relief.

 

Nothing contained in this Lease shall limit or prejudice Landlord’s right to prove and obtain as liquidated damages in any bankruptcy, insolvency, receivership, reorganization or dissolution proceeding, an amount equal to the maximum allowable by any Laws governing such proceeding in effect at the time when such damages are to be proved, whether or not such amount be greater than, equal to or less than the amounts recoverable, either as damages or Rent, under this Lease.

 

Without limiting the foregoing, by reason of (a) Landlord’s interest in this Lease, (b) the importance to Landlord of Tenant continuing to carry on business in the Premises at all times in accordance with this Lease, and (c) Landlord’s entitlement to damages where this Lease is terminated by reason of an event of default, Landlord does and will constitute a separate class or category of creditor in any plan of arrangement or proposal submitted by or on behalf of Tenant under the Companies Creditors’ Arrangement Act or the Bankruptcy and Insolvency Act , despite any changes in circumstances of Tenant or its business.

 

15.4 Remedies Not Exclusive.

 

Notwithstanding anything to the contrary herein contained, in lieu of or in addition to any of the foregoing remedies and damages, Landlord may exercise any remedies and collect any damages available to it at law or in equity. If Landlord is unable to obtain full satisfaction pursuant to the exercise of any remedy, it may pursue any other remedy which it has hereunder or at law or in equity.

 

15.5 No Mitigation.

 

Landlord shall not be required to mitigate any of its damages hereunder. If any Law shall validly limit the amount of any damages provided for herein to an amount which is less than the amount agreed to herein, Landlord shall be entitled to the maximum amount available under such Law.

 

15.6 No Waiver.

 

No failure of Landlord (a) to insist at any time upon the strict performance of any provision of this Lease, or (b) to exercise any option, right, power or remedy contained in this Lease shall be construed as a waiver, modification or relinquishment thereof. A receipt by Landlord of any sum in satisfaction of any obligation with knowledge of the breach of any provision hereof shall not be deemed a waiver of such breach, and no waiver by Landlord of any provision hereof shall be deemed to have been made unless expressed in writing signed by Landlord.

 

15.7 Remedies Cumulative.

 

Except as otherwise provided herein, all remedies are cumulative and concurrent and no remedy is exclusive of any other remedy. Each remedy may be exercised at any time an Event of Default has occurred and is continuing and may be exercised from time to time. No remedy shall be exhausted by any exercise thereof.

 

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15.8 Recovery of Enforcement Costs.

 

All Costs and expenses, including reasonable solicitors’ fees and disbursements, incurred by Landlord and/or Tenant in connection with the exercise of any permitted remedy for an Event of Default, or the enforcement of the provisions of this Lease, together with interest thereon at the Default Rate from the date incurred, shall be borne by Losing Party to such action and shall be paid by said Losing Party upon demand.

 

Article 16
RIGHT OF LANDLORD TO PERFORM TENANT’S COVENANTS

 

16.1 Right to Perform.

 

Landlord shall have the right at any time, after five (5) days’ notice to Tenant or without notice in case of an actual or apprehended emergency (or in case any fine, penalty, interest or Cost may otherwise be imposed or incurred), to make any payment including but not limited to Taxes, or perform any act required of Tenant under any provision of this Lease, and in exercising such right, to incur necessary or incidental Costs. Nothing herein shall imply any obligation on the part of Landlord to make any payment or perform any act required, and the exercise of the right to do so shall not constitute a release of any obligations or a waiver of any default.

 

16.2 Reimbursement.

 

All payments made and all costs and expenses incurred in connection with any exercise of such right shall be reimbursed by Tenant to Landlord within ten (10) days after notice, together with interest at the Default Rate from the respective dates of the making of such payments or the incurring of such costs and expenses. In addition to any other rights and remedies available to Landlord, Landlord shall have, in respect of Tenant’s failure to make reimbursement of any amount as aforesaid, the same rights and remedies as in the case of default by Tenant in the payment of the Basic Rent, including, but not limited to, the right to deduct any such amount from monies otherwise owed by Landlord to Tenant.

 

16.3 Exercise of Remedies.

 

Landlord and its authorized representatives, including without limitation, mortgagees, shall have the right to enter the Premises at all times for the purpose of (a) exercising any right, power or remedy reserved to Landlord in this Lease, or (b) performing any obligation of Tenant with respect to which an Event of Default has occurred under this Lease.

 

16.4 Inspection.

 

Landlord and its authorized representatives, including, without limitation, mortgagees, shall have the right to enter the Premises at all reasonable times during normal business hours, after not less than two (2) days’ prior notice to Tenant, for the purpose of (a) examining or inspecting the Premises, or (b) showing the Premises to prospective purchasers, mortgagees or tenants.

 

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16.5 Costs.

 

All payments made by Landlord and all Costs (including, without limitation, reasonable fees and expenses of solicitors, expert witnesses, architects, engineers and other consultants) incurred by Landlord in connection with the exercise of its rights under Section 16.3, together with interest at the Default Rate from the respective dates of the making of such payments or the incurring of such costs and expenses, shall constitute Additional Rent and shall be payable to Landlord by Tenant on demand.

 

16.6 No Eviction.

 

The exercise of any right reserved to Landlord or its authorized representatives in Sections 16.3 or 16.4 shall not constitute an actual or constructive eviction, in whole or in part, or entitle Tenant to any abatement or diminution of Basic Rent or Additional Rent or relieve Tenant from any of its obligations under this Lease or impose any liability on Landlord or its authorized representatives by reason of inconvenience or annoyance to Tenant or injury to or interruption of Tenant’s business or otherwise.

 

16.7 No Interference.

 

In any case in which Landlord or its authorized representatives enter the Premises for any of the purposes set forth in this Article 16, Tenant shall not interfere, directly or in any manner or form with, the conduct of any work being performed by or for Landlord. Tenant hereby releases Landlord from any damages or claims of damages arising from any loss of business or from any increase in operating costs of Tenant’s business, resulting directly or indirectly from the conduct of any such work, whether or not due to Landlord’s negligence.

 

16.8 Right to Re-Enter.

 

The Tenant hereby grants to the Landlord (upon reasonable notice to the Tenant, subject to the requirements of the City of Toronto (the “City”), the Regional Municipality of Toronto (the “Region”) or any governmental or utility authority or commission) and to the City and the Region the right at any time or times to enter upon the Land for the purpose of correcting any drainage problem or for the purpose of re-grading or rectifying the grading and installing such piping, catch basins and grates as may be reasonably necessary to the satisfaction of the City or the Region or the Commissioner of Public Works or in order to comply or effect compliance in any other manner with any subdivision agreement relating to the Land. The Landlord in exercising such right of re-entry shall not unreasonably interfere with the business of the Tenant or the Landlord. The Tenant shall not, without the prior permission of the Vendor in writing, interfere with any drainage ditches or obstruct the natural flow of water.

 

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Article 17
NOTICES

 

17.1 Notices.

 

All notices required or permitted under this Lease must be in writing and will only be deemed properly given and received (a) when actually given and received, if delivered in person to a party; or (b) one Business Day after deposit with a private courier or overnight delivery service; or (c) on the day of telecopy transmission if same is a Business Day or otherwise on the next following Business Day. All such notices must be transmitted by one of the methods described above to the party to receive the notice at, in the case of notices to Landlord, Landlord’s Address, and in the case of notices to Tenant, Tenant’s Address, or, in any case, at such other address(es) as Landlord or Tenant may notify the other of according to this Section 17.1.

 

Article 18
MISCELLANEOUS

 

18.1 Performance by Landlord.

 

Any act which Landlord is permitted to perform under this Lease may be performed at any time and from time to time by Landlord or any Person designated by Landlord. Each appointment of Landlord as attorney-in-fact for Tenant hereunder is irrevocable and coupled with an interest.

 

18.2 Time.

 

Time is of the essence in this Lease.

 

18.3 Registration on Title.

 

Tenant shall not register this Lease in full on the title to the Premises. If Tenant wishes to register a notice of this Lease, Tenant may do so provided that Landlord has first approved such notice in writing at Tenant’s expense.

 

In the event of any conflict between the terms of this Lease and the terms of such notice or short form, the terms of this Lease shall prevail.

 

Tenant agrees that it will, at its sole expense, discharge and withdraw from title any such registration within 30 days after the expiration or sooner termination of this Lease. If such registration is not discharged and withdrawn during the aforesaid time, Landlord shall have the right and is hereby appointed by Tenant as its agent and attorney to prepare, execute and register such documentation as is required to discharge and withdraw any such registration.

 

18.4 Only Landlord/Tenant Relationship.

 

Landlord and Tenant agree that neither any provision of this Lease nor any act of the parties shall be deemed to create any relationship between Landlord and Tenant other than the relationship of landlord and tenant.

 

18.5 Counterparts.

 

This Lease may be executed in counterparts, and executed counterparts bearing signatures of Landlord and Tenant shall constitute a fully executed original of this Lease.

 

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18.6 Compliance with the Planning Act.

 

It is an express condition of this Lease, that the provisions of Section 50 of the Planning Act (Ontario) and amendments thereto, or replacements thereof, be complied with if applicable in law.

 

18.7 Successors.

 

All rights and liabilities herein given to, or imposed upon, the respective parties hereto shall extend to and bind the respective successors and permitted assigns of the said parties.

 

18.8 Commissions.

 

[INTENTIONALLY DELETED]

 

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Having read and intending to be bound by the terms and provisions of this Lease, Landlord and Tenant have signed it as of the date first set forth

 

    454675 ONTARIO LIMITED  
       
    Per:    
      Name:
Title: 		 
        c/s
    Per:    
      Name:
Title: 		 
         
    I/We have authority to bind the Corporation.  
       
    CUI-CANADA, INC.  
       
    Per:    
      Name:
Title: 		 
        c/s
    Per:    
      Name:
Title: 		 
         
    I/We have authority to bind the Corporation.  
       

 

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EXHIBIT “A”

 

EXISTING EASEMENTS

 

1. Instrument Number A983584

 

2. Instrument Number NY773515

 

 
 

 

EXHIBIT “B”

 

TENANT’S WORK

 

[INTENTIONALLY DELETED]

 

 
 

 

EXHIBIT “C”

 

EXTENSION OPTION

 

So long as the Tenant is CUI-CANADA, INC. and is itself in occupation of the whole of the Premises, and there is no Event of Default with respect to the Tenant, then Tenant shall have the option to extend the Term of this Lease by notice in writing to Landlord at least nine (9) months and not earlier than twelve (12) months prior to the expiry of the Term for a further period of FIVE   (5) years (“Extension Term”) on the same terms and conditions as set forth in this Lease save and except that:

 

(a) there shall be no further right to extend or renew this Lease after the expiry of the Extension Term;

 

(b) all Rent (including Basic Rent and all other amounts payable pursuant hereto) shall be payable commencing on the first day of such Extension Term and shall continue thereafter at all times throughout such Extension Term without any period during which any such Rent shall not be payable;

 

(c) Tenant shall accept the Premises in the then existing condition thereof and Landlord shall not be required to do any work or pay any allowance or give any inducements in respect thereof;

 

(d) the annual Basic Rent shall be the greater of: (i) the Basic Rent payable hereunder during the last year of the Term, and (ii) the Market Rent for the Premises for the Extension Term. For the purposes of this Exhibit “C”, “Market Rent” means the annual rental which could reasonably be obtained by Landlord for the Premises from a willing tenant or willing tenants renewing their lease(s) dealing at arm’s length with Landlord in the market prevailing for a term commencing on the date upon which the Extension Term is to commence, having regard to all relevant circumstances including the size and location of the Premises, the facilities afforded, the terms of the Lease (including the provision of Additional Rent) and the leasehold improvements therein, and with the assumption that the existing leasehold improvements are ideal for Tenant’s use as is, and with the further assumption that either the existing leasehold improvements are fully adequate for Tenant’s use of the Premises throughout the Extension Term or there remains sufficient time over which such improvements may be amortized, if further leasehold improvements are reasonably required to be made by Tenant to facilitate Tenant’s use of the Premises, or to comply with Tenant’s obligations hereunder, during the Extension Term, the cost of such improvements can be fully amortized by the end of the Extension Term, and disregarding any disrepair to the Premises or improvements therein resulting from Tenant’s failure to properly maintain and repair the same, or removal of any leasehold improvements and having regard also to the rental currently being obtained for premises similarly located in similar buildings in the vicinity of the Building, and in particular to any leases recently made by Landlord of comparable premises in the subdivision to those with whom Landlord is dealing at arm’s length and with the assumption that the use to be made of the Premises is the highest and best use which may legally be made of the Premises irrespective of and without affecting the provisions of this Lease respecting the use to be made of the Premises, or the interpretation thereof. If Landlord and Tenant fail to agree on the Market Rent for such Extension Term at least three (3) months prior to the commencement thereof, the Market Rent for such Extension Term shall be determined in the manner set out below.

 

 
 

 

Either Landlord or Tenant (the “Requesting Party”) shall be entitled to notify the other party hereto (the “Receiving Party”) of the name of an expert for the purpose of determining the Market Rent. Within fifteen (15) days after such notice from the Requesting Party, the Receiving Party shall notify the Requesting Party either approving the expert proposed by the Requesting Party or naming another expert for the purpose of determining the Market Rent. Should the Receiving Party fail to give notice to the Requesting Party within the said fifteen (15) day period, the expert named in the notice to the Requesting party shall perform the expert’s functions hereinafter set forth. If Landlord and Tenant are unable to agree upon the selection of the expert within fifteen (15) days after such notice from the Receiving Party to the Requesting Party, then either party shall be entitled to apply to a court to appoint an expert in the same manner as an arbitrator may be appointed by a court under the Arbitrations Act of Ontario. The expert appointed, either by Landlord and/or Tenant or by a court, shall be qualified by education, experience and training to value real estate for rental purposes in the Province of Ontario and have been ordinarily engaged in the valuation of real property in the municipality in which the Building is located for at least the immediately preceding five (5) years. Within thirty (30) days after being appointed the expert shall make a determination of the Market Rent for the Extension Term, without receiving evidence from either Landlord or Tenant. The cost of such determination shall be borne by the Tenant. The determination of the expert as to the Market Rent shall be conclusive and binding upon Landlord and Tenant and not subject to appeal.

 

If the Basic Rent payable during the Extension Term has not been determined prior to the commencement of the Extension Term then, from the commencement date of such Extension Term until such determination has been made, Tenant shall make monthly payments on account of Basic Rent calculated at a rate equal to 110 % of the Basic Rent payable during the last year of the Term, and upon determination of the Basic Rent payable during the Extension Term, the appropriate adjustments shall be made between Landlord and Tenant, including interest on any over or under payments together with interest thereon at one (1%) percent per annum in excess of the Prime Rate, to the date of determination of the Basic Rent for the Extension Term.

 

- 2 -

Exhibit 99.3

   

CUI Global Announces Acquisition of Tectrol Inc.

 

Company Acquires the Assets of Canada-based Equipment Manufacturer

 

TUALATIN, Ore., March 3, 2015 — CUI Global, Inc. (NASDAQ:CUI), a platform company dedicated to the acquisition, development, and commercialization of new, innovative products, announced today that it has entered into a definitive agreement under which CUI Global will acquire specific assets of the privately held Canadian equipment manufacturer Tectrol, Inc, a leading designer and manufacturer of standard and custom power solutions.

 

Key Highlights:

 

· CUI Global agrees to purchase the assets of Tectrol, including usable inventory, for $5.2 million;
· Acquisition will provide immediate incremental revenue growth;
· Acquisition will immediately provide CUI, Inc. and CUI Global with manufacturing capabilities for, among other things, its Novum® and Solus® Technologies, along with certain electronic components in its proprietary GasPT2 product;
· The acquisition is expected to close in early March 2015.

 

CUI Global’s President & CEO, William Clough commented, “We believe this transaction delivers great value for our shareholders and I fully expect it will positively impact our top and bottom lines over the course of the next several years. Additionally, it will give CUI a greater presence in the electronics space as well as further enhance our status as a well-recognized manufacturer. All in all, we feel like this is an opportunistic acquisition of a well-respected company at a very good price, and we feel fortunate to have been in a position to move forward with this transaction.”

 

Matt McKenzie, CUI Global’s COO & President of CUI’s Power Segment added, “We believe this transaction is a step forward for our company as we look to deliver our customers the most advanced power solutions from the ac front-end all the way to the dc point of load. We are very excited about the synergies between the companies and are confident that the integration will immediately enhance the capabilities of our Power Group.”

 

Tectrol Inc. is a family-owned, Toronto, Canada-based company that was founded in 1968. For over 40 years, the Company has consistently been one of the most flexible and most respected providers of power products with the unique ability to accommodate design challenges for low, medium and high volume applications. Its customer list includes some of the most iconic electronic, networking, medical and technology companies in the world.

 

The Tectrol line complements CUI, Inc.’s Novum Advanced Power products and will serve the same primary customer base. Having already developed the board-level Novum product line, CUI, Inc. will now be able to offer a complete power system with Tectrol’s robust line of power supplies feeding the power to the board level modules.

 

 
 

  

“Much like our acquisition of Orbital-UK almost two years ago, the acquisition of Tectrol, with the associated increase in revenues and the dramatic increase in our ability to penetrate and broaden our already extensive customer base in the electronics industry, all combine to further our strategy of making opportunistic, synergistic acquisitions of either technology, personnel, or companies that will increase our growth and, thereby, enhance our shareholder value - this transaction certainly encapsulates all of those positive elements,” Clough concluded.

 

About CUI Global, Inc.

Delivering Innovative Technologies for an Interconnected World . . . . .

 

CUI Global, Inc. is a publicly traded company dedicated to maximizing shareholder value through the acquisition and development of innovative companies, products and technologies. From Orbital Gas Systems' advanced GasPT2 platform targeting the energy sector, to CUI Inc's digital power platform serving the networking and telecom space, CUI Global and its subsidiaries have built a diversified portfolio of industry leading technologies that touch many markets. As a publicly traded company, shareholders are able to participate in the opportunities, revenues, and profits generated by the products, technologies, and market channels of CUI Global and its subsidiaries. But most importantly, a commitment to conduct business with a high level of integrity, respect, and philanthropic dedication allows the organization to make a difference in the lives of their customers, employees, investors and global community.

 

For more information please visit www.cuiglobal.com

 

Important Cautions Regarding Forward Looking Statements

This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are subject to risks and uncertainties that could cause actual results to vary materially from those projected in the forward-looking statements. The company may experience significant fluctuations in future operating results due to a number of economic, competitive, and other factors, including, among other things, our reliance on third-party manufacturers and suppliers, government agency budgetary and political constraints, new or increased competition, changes in market demand, and the performance or reliability of our products. These factors and others could cause operating results to vary significantly from those in prior periods, and those projected in forward-looking statements. Additional information with respect to these and other factors, which could materially affect the company and its operations, are included in certain forms the company has filed with the Securities and Exchange Commission.

 

Media Contact:

CUI Global, Inc.
Maggie Lefor

Main: 503-612-2300
press@cuiglobal.com

Outside IR contact:

Stonegate Securities
Casey Stegman
214-987-4121

casey@stonegateinc.com