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ACME UNITED CORP FILES (8-K) Disclosing Entry into a Material Definitive Agreement, Completion of Acquisition or Disposition of Assets, Financial Statements and Exhibits

June 6, 2014



Item 1.01. Entry into a Material Definitive Agreement

On June 2, 2014, Acme United Corporation, a Connecticut corporation (the "Company"), and First Aid Only, Inc., a Washington corporation (the "Seller"), entered into an Asset Purchase Agreement (the "Purchase Agreement") pursuant to which the Company agreed to purchase substantially all of the Seller's assets related to its first aid and industrial safety kit business (the "Business") (the "Transaction"). The purchased assets include inventory, equipment, accounts receivable, patents, trademarks, other intellectual property and goodwill.

The parties also consummated the Transaction on June 2, 2014. At closing the Company paid $13,800,000 in cash to the Seller. Of that amount, $690,000 was deposited into escrow with a national bank and will remain in escrow for a period of 12 months following closing as a non-exclusive source to satisfy the Seller's indemnification and reimbursement obligations to the Company under the Purchase Agreement. In addition, the Company will assume certain obligations and liabilities related to the Business. The Company utilized funds borrowed under its revolving credit facility with HSBC Bank to make payment of the purchase price to the Seller.

The Company and Mark Miller, President of the Seller, have entered into a one-year Employment Agreement, effective at Closing, pursuant to which Mr. Miller has joined the management team responsible for the Business. Mr. Miller has also entered into a Non-Competition and Confidentiality Agreement with the Company, which is effective during the term of his employment by the Company and for a period of five years thereafter.

The Purchase Agreement contains customary representations, warranties, covenants and agreements of the parties

Prior to closing, the Company and the Seller had no material relationship other than in respect of the Purchase Agreement.

On June 2, 2014, the Company issued a press release announcing the Transaction, a copy of which is filed herewith as Exhibit 99.1.

Item 2.01 Completion of Acquisition or Disposition of Assets.

As described in Item 1.01 above, the Closing of the Transaction occurred on June 2, 2014. The information set forth in Item 1.01 is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(c) Exhibits Exhibit Number Description

99.1 Press release dated June 2, 2014. 2


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Source: Edgar Glimpses