ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT, dated as of this 28th day of
July, 1998, by and among PARAMOUNT FINANCIAL CORPORATION, a
Delaware corporation (the "Parent"), DELTAFORCE PERSONNEL SERVICES,
------
INC., a New York corporation and a wholly-owned subsidiary of the
Parent (the "Purchaser"), RBW STAFFING RESOURCES INC., a New York
---------
corporation ("WordSmiths" or the "Company"), and ▇▇▇▇▇▇ ▇▇▇▇▇
---------- -------
("▇▇▇▇▇"), the sole shareholder of the Company.
-----
W I T N E S S E T H
- - - - - - - - - -
WHEREAS, the Company is in the business among other
things, of providing temporary legal support staffing and
temporary personnel services to the legal community (which
business as currently conducted is referred to as the
"Business"); and --------
WHEREAS, WordSmiths desires to sell and transfer to
Purchaser, and Purchaser desires to purchase and acquire from
WordSmiths, all of WordSmiths' right, title and interest in and
to the name "WORDSMITHS," the Company's customer list, the
Company's applicant base directory and all of the Business
computer software and computer systems (collectively the
"Purchased Assets"); and
----------------
WHEREAS, in furtherance of the consummation of the
acquisition of the Purchased Assets and the other transactions
contemplated hereby (the "Contemplated Transactions"), the parties
-------------------------
hereto desire to enter into this Agreement.
NOW THEREFORE, in consideration of the premises and
mutual covenants and agreements set forth herein, the parties
hereto agree as follows:
ARTICLE I
PURCHASE AND SALE OF PURCHASED ASSETS
SECTION 1.1 PURCHASED ASSETS. Effective as of the close of
----------------
business on the date hereof, the Company hereby assigns,
transfers, sells, conveys and delivers to Purchaser, and
Purchaser hereby purchases and acquires from the Company, all of
the Company's right, title and interest in and to the Purchased
Assets, free and clear of any mortgage, lien (including
mechanics, warehouse, laborers and landlords liens), claim,
pledge, charge, security interest, preemptive right, right of
first refusal, option, judgment, title defect or encumbrances of
any kind, other than the European American Bank lien for which a
UCC-3 terminating such lien is presently being obtained by the
Company and will be delivered simultaneously herewith
(collectively, "Liens"). The Company's customer list, applicant
-----
base directory and a list of the Business computer software
and computer systems are being delivered to Purchaser
concurrent with the execution hereof.
SECTION 1.2 PURCHASE PRICE. As full consideration for the
--------------
Purchased Assets, concurrently herewith the Purchaser is paying
to or for the account of the Company an amount equal to $350,000,
payable as follows: (a) Two Hundred Fifty Thousand Dollars
($250,000) cash pursuant to wire transfer instructions provided
to Purchaser by the Company, and (b) a promissory note of the
Purchaser (the "Note") in the principal amount of One Hundred
----
Thousand Dollars ($100,000), in the form annexed hereto as Exhibit
-------
A. The Note bears interest at eight and one half percent (8.5%)
-
per annum and is payable in one payment of One Hundred Thousand
Dollars ($100,000) plus accrued and unpaid interest on the
principal. The Note is due and payable on the first anniversary
of the date of this Agreement.
SECTION 1.3 ALLOCATION. The parties agree that the
----------
consideration paid under this Agreement and the Transaction
Documents (as defined below) will be allocated in accordance with
the manner indicated in this Agreement and the Transaction
Documents. The Purchaser, Parent, the Company and ▇▇▇▇▇ hereby
each covenant and agree that it/he will not take a position on
any income tax return (including any report filed on Internal
Revenue Form 8594), before any governmental agency charged with
the collection of any income tax or in any judicial proceeding,
any financial reporting, or in any Securities and Exchange
Commission reporting that is in any way inconsistent with the
terms of this Section 1.3.
SECTION 1.4 NO ASSUMPTION OF LIABILITIES. Regardless of
----------------------------
whether any of the following is disclosed to Purchaser, Parent or
any of their representatives or otherwise or whether Purchaser,
Parent or any of their representatives may have knowledge of the
same, Purchaser shall have no liability for, and shall be under
no obligation to assume, and shall not be deemed to be and is not
assuming, any Lien or other obligation, liability, contract or
commitment of the Company of any kind or nature whatsoever,
including but not limited to, (a) any liability under any account
payable, lease, note, indenture, loan agreement, employment
contract, agreement containing severance or termination pay
arrangements or deferral compensation agreement or any other
contract or agreement (written or oral) relating to the Company
or the Business; (b) any liability of the Company for federal,
state or local taxes, including without limitation, any income,
capital gains or franchise taxes, or any taxes on capital
(including any taxes payable as a result of the Contemplated
Transactions); (c) any liability or obligation whatsoever of the
Company under, or directly or indirectly relating to, any
employee benefit plan or any other plans, programs or
arrangements of any kind relating to employee benefits sponsored
or maintained by the Company; (d) any liability or obligation of
the Company for claims covered by the Company's insurance
policies arising out of any act or omission occurring or state of
facts existing prior to or after the date hereof, including
without limitation, workers' compensation, general liability,
fire and property insurance policies, and any liability or
obligation of the Company for premiums which may be due or are
payable under any such insurance policy; and (e) any liability of
the Company relating to the Business or otherwise (collectively,
the "Company Liabilities").
-------------------
ARTICLE II
AGREEMENTS DELIVERED CONCURRENTLY HEREWITH
Simultaneously herewith, in connection with the consummation
of the Contemplated Transactions, Purchaser is entering into an
employment agreement and a noncompetition agreement with ▇▇▇▇▇,
and a noncompetition agreement with ▇▇▇▇▇▇▇ ▇▇▇▇▇ (collectively
with all other documents or instruments delivered hereunder, the
"Transaction Documents"). The following Transaction Documents are
---------------------
fully executed and delivered concurrently herewith as follows:
SECTION 2.1 Employment Agreement. Concurrently herewith,
--------------------
Purchaser is entering into a two-year employment agreement with
▇▇▇▇▇ (the "Employment Agreement"), dated the date of this
--------------------
Agreement, in the form annexed hereto as Exhibit B.
---------
SECTION 2.2 NONCOMPETITION AGREEMENTS. (a) In connection
-------------------------
with the consummation of the Contemplated Transactions, ▇▇▇▇▇ is
concurrently herewith entering into a five year noncompetition
agreement (the "Noncompetition Agreement") with Purchaser, dated as
------------------------
of the date of this Agreement, in the form annexed hereto as
Exhibit C.
---------
(b) In connection with the consummation of the
Contemplated Transaction, ▇▇▇▇▇▇▇ ▇▇▇▇▇ is concurrently herewith
entering into a noncompetition agreement with Purchaser, dated as
of the date of this Agreement, in the form annexed hereto as
Exhibit D.
---------
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company and ▇▇▇▇▇, jointly and severally, represent and
warrant to Purchaser and Parent, as of the date of this
Agreement, that:
SECTION 3.1 CORPORATE EXISTENCE AND POWER; TITLE TO PURCHASED
-------------------------------------------------
ASSETS. (a) The Company is a corporation duly organized, validly
------
existing and in good standing under the laws of the State of New
York, and has all requisite powers and all material permits
required to own, lease and operate its properties and to conduct
the Business as currently conducted.
(b) The Company does not have any subsidiaries and
does not directly or indirectly own any interest or investment in
any other person.
(c) The Company has, and pursuant to this Agreement is
conveying, selling, transferring, assigning and delivering to
Purchaser, good, valid, marketable, legal and beneficial title to
all of the Purchased Assets and is the lawful owner of the
Purchased Assets, free and clear of all Liens.
SECTION 3.2 AUTHORITY RELATIVE TO THIS AGREEMENT. The
------------------------------------
Company has full power and authority to execute and deliver this
Agreement and each other Transaction Document to which it is a
party and to consummate the Contemplated Transactions. The
execution, delivery and performance by the Company of this
Agreement and the other Transaction Documents to which it is a
party, and the consummation by it of the Contemplated
Transactions, have been duly and validly authorized and approved
by the Company's board of directors and shareholders, and no
other corporate proceedings on the part of the Company are
necessary to authorize the execution and delivery by the Company
of this Agreement or the other Transaction Documents to which the
Company is a party or the consummation of the Contemplated
Transactions. This Agreement and the other Transaction Documents
to which the Company is a party have been duly and validly
executed and delivered by the Company, and (assuming the valid
execution and delivery thereof by the other parties thereto)
constitute the legal, valid and binding agreements of the
Company, enforceable against the Company, in accordance with
their respective terms, except as such obligations and their
enforceability may be limited by applicable bankruptcy and other
similar laws affecting the enforcement of creditors' rights
generally and except that the availability of equitable remedies
is subject to the discretion of the court before which any
proceeding therefor may be brought (whether at law or in equity).
SECTION 3.3 NO CONFLICTS; CONSENTS. Neither the execution,
----------------------
delivery and performance by the Company of this Agreement and
each other Transaction Document to which it is a party, nor the
consummation of the Contemplated Transactions (i) violates any
provision of the Articles of Incorporation or by-laws of the
Company; (ii) requires the Company to obtain any consent,
approval, permit or action of or waiver from, or make any filing
with, or give any notice to, any governmental body, or any other
person; (iii) violates, conflicts with or results in a breach or
default under (after the giving of notice or the passage of time
or both), or permits the termination of, any contract, right,
other obligation or restriction relating to or which affects the
Purchased Assets or the Business or to which the Company is a
party or by which the Company, the Business or any of the
Purchased Assets may be bound or subject, or results in the
creation of any Lien upon any of the Purchased Assets pursuant to
the terms of any such contract; (iv) violates any law or order of
any governmental body against, or binding upon, the Company or
upon the Purchased Assets or the Business of the Company; or (v)
violates or results in the revocation or suspension of any permit
necessary for the conduct of the Business.
SECTION 3.4 CHARTER DOCUMENTS AND CORPORATE RECORDS. (a)
---------------------------------------
The Company has heretofore delivered to Purchaser and Parent true
and complete copies of the Articles of Incorporation and by-laws
of the Company as in effect on the date hereof. The stock and
transfer books of the Company have been made available to
Purchaser and Parent for their inspection and are true and
complete. The Company has heretofore permitted Purchaser and
Parent to inspect true and complete copies of the minutes of
meetings (or written consents in lieu of meetings) of the board
of directors (and all committees thereof) and shareholders of the
Company. All actions taken by the board of directors (and all
committees thereof) and shareholders of the Company are reflected
in such minutes, written consents and other documentation.
(b) All financial, business and accounting books,
ledgers, accounts and official and other records relating to the
Company, the Business and the Purchased Assets have been properly
and accurately kept and completed in all material respects, and
there are no material inaccuracies or discrepancies contained or
reflected therein, other than the disputed
classification/assessment by the Department of Labor of the
employees of WordSmiths relating to tax treatment of such
employees, which is presently being appealed by WordSmiths (the
"Department of Labor Claim").
-------------------------
SECTION 3.5 FINANCIAL INFORMATION. The Company has
---------------------
previously furnished to Purchaser and Parent true and complete
copies of (i) the Company's unaudited financial statements at and
for the year ended June 30, ▇▇▇▇ (▇▇▇ "▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇"), (▇▇)
-------------------
the Company's unaudited financial statements at and for the years
ended June 30, 1996 and 1995, and (iii) the Company's unaudited
statements reflecting revenues and expenses for the calendar
quarters and eleven months ended May 31, 1998 and 1997
(collectively, the "Interim Statements"). The Interim Statements
------------------
accurately present the revenue and expenses of the Company on a
cash basis for the periods then ended. The June 1997 Statement
has been prepared in a manner consistent with the Company's past
practices and accurately present the financial position of the
Company as of its date and results of operations for the period
then ended.
SECTION 3.6 ABSENCE OF CERTAIN CHANGES. Since the June 1997
--------------------------
Statement, except as set forth in this Agreement, the Company has
conducted the Business in the ordinary course consistent with
past practices and there has not been:
(a) Any material adverse change in the Business,
assets, financial condition, prospects or results of operations
of the Company (collectively, the "Condition of the Business") or
-------------------------
any event, occurrence or circumstance that could reasonably be
expected to cause such a material adverse change;
(b) Any material adverse change in the relationships
of the Company with its customers and applicants; or
(c) Except for any changes made in the ordinary course
of the Business, any material change in any of the Company's
business policies, including advertising, marketing, pricing,
purchasing, personnel, returns or budget policies.
SECTION 3.7 INTANGIBLE PROPERTY. (a) The Company owns a
-------------------
doing-business-as (d/b/a) in and to the name "WordSmiths" (the
"Acquired Name") filed in New York County, New York and any and all
-------------
other intellectual property rights necessary to conduct the
Business and there are no agreements, arrangements, claims or any
other rights of any character entitling any person other than
Purchaser to any interest in the Acquired Name and the Company's
other intellectual property rights;
(b) the Company has not received any notice contesting
the Company's right to use the Acquired Name;
(c) the Acquired Name and any other intellectual
property rights of the Company have not been and are not the
subject of any pending or, to the Company's or ▇▇▇▇▇'▇ knowledge,
threatened litigation or claim of infringement.
SECTION 3.8 CLAIMS AND PROCEEDINGS. There are no outstanding
----------------------
orders of any governmental body against or involving the Company,
the Purchased Assets or the Business, other than the Department
of Labor Claim. Other than the Department of Labor Claim, there
are no actions, suits, claims or counterclaims or legal,
administrative or arbitral proceedings or investigations,
(collectively, "Claims") (whether or not the defense thereof
------
or liabilities in respect thereof are covered by insurance),
pending or, to the Company's or ▇▇▇▇▇'▇ knowledge, threatened on
the date hereof, against or involving the Company, any of the
Purchased Assets or the Business. There is no fact, event or
circumstance known to the Company or ▇▇▇▇▇ that would give rise
to any Claim other than the Department of Labor Claim that, if
pending or threatened would, in the Company's or ▇▇▇▇▇'▇ reasonable
judgment, have an adverse effect on the Condition of the Business.
SECTION 3.9 COMPLIANCE WITH LAWS. The Company is not in
--------------------
violation of any order, judgment, injunction, award, citation,
decree, consent decree or writ, or any law, statute, code,
ordinance, rule, regulation or other requirement, of any
government or political subdivision thereof, whether federal,
state, local or foreign, or any agency or instrumentality of any
such government or political subdivision, or any court or
arbitrator affecting the Purchased Assets or the Business, other
than the Department of Labor Claim.
SECTION 3.10 PERMITS. The Company has obtained all licenses,
-------
permits, certificates, certificates of occupancy, orders,
authorizations and approvals of (collectively, "Permits"), and
-------
has made all required registrations and filings with, any
governmental body that are required for the conduct of the
Business. All Permits that are required for the conduct of the
Business are in full force and effect; no violations are or have
been recorded in respect of any Permit; and no proceeding is
pending or threatened to revoke or limit any Permit. No Permit
will terminate by reason of consummation of this Agreement.
SECTION 3.11 CUSTOMERS; APPLICANTS. The relationships of the
---------------------
Company with its customers are reasonable commercial working
relationships and (i) all amounts owing from such customers, if
not in dispute, have been paid in accordance with their
respective terms, (ii) none of such customers within the last
twelve months has threatened in writing to cancel, or otherwise
terminate, the relationship of such person with the Company, and
(iii) to the Company's or ▇▇▇▇▇'▇ knowledge, none of such
customers during the last twelve months has decreased materially
or threatened to decrease or limit materially its relationship
with the Company or intends to decrease or limit materially its
business with the Company. There has been no reduction in the
number or quality of the applicants available to the Company
beyond levels normally experienced in the ordinary course of the
Company's Business.
SECTION 3.12 DISCLOSURE. Neither this Agreement, nor any
----------
audited or unaudited financial statements, documents or
certificates furnished or to be furnished to Purchaser, Parent or
any of their representatives or affiliates by or on behalf of the
Company pursuant to this Agreement or in connection with this
Agreement contains to the best of the Company's or ▇▇▇▇▇'▇
knowledge or will contain any untrue statement of a material fact
or omits or will omit to state a material fact necessary in order
to make the statements contained herein or therein not
misleading. There are no facts known to ▇▇▇▇▇ or the Company and
not disclosed herein, which might reasonably be expected to
directly and materially adversely affect the value of the
Purchased Assets or the Condition of the Business. All
representations and warranties made by the Company or ▇▇▇▇▇ will
be deemed to have been relied on by Purchaser and Parent
(notwithstanding any investigation by Purchaser).
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF THE PURCHASER AND PARENT
SECTION 4.1 CORPORATE EXISTENCE AND POWERS. (a) The
------------------------------
Purchaser is a corporation duly organized, validly existing and
in good standing under the laws of the State of New York, and has
all requisite powers and all material permits required to own,
lease and operate its properties and to conduct its businesses.
(b) The Parent is a corporation duly organized,
validly existing and in good standing under the laws of the State
of Delaware, and has the requisite powers and all material
permits required to own, lease and operate is properties and to
conduct is business.
SECTION 4.2 AUTHORITY RELATIVE TO THIS AGREEMENT. The
------------------------------------
Purchaser and the Parent have the full power and authority to
execute and deliver this Agreement and each other Transaction
Document to which it is a party and to consummate the
Contemplated Transactions. The execution, delivery and
performance by the Purchaser and the Parent of this Agreement and
the other Transaction Documents to which it is a party, and the
consummation by them of the Contemplated Transactions, have been
duly and validly authorized and approved by each of the
Purchaser's and the Parent's board of directors, and no other
corporate proceedings on the part of the Purchaser or the Parent
are necessary to authorize the execution and delivery by the
Purchaser and the Parent of this Agreement or the other
Transaction Documents to which the Purchaser or Parent is a party
or the consummation of the Contemplated Transaction. This
Agreement and the other Transaction Documents to which the
Purchaser or the Parent is a party have been duly and validly
executed and delivered by the Purchaser or the Parent, and
(assuming the valid execution and delivery thereof by the other
parties thereto) constitute the legal, valid and binding
agreements of the Purchaser and the Parent, enforceable against
the Purchaser and the Parent in accordance with their respective
terms, except such obligations and their enforceability may be
limited by applicable bankruptcy or other similar laws affecting
the enforcement of creditors' rights generally and except for the
availability of equitable remedies subject to the discretion of
the court before which any proceeding may be brought (whether at
law or in equity).
SECTION 4.3 NO CONFLICTS; CONSENTS. Neither the execution,
----------------------
delivery and performance by the Purchaser or the Parent of this
Agreement and each of the other Transaction Documents to which it
is a party, nor the consummation of the Contemplated Transactions
(i) violates any provision of the Articles of Incorporation or
by-laws of either the Purchaser or the Parent; (ii) requires the
Purchaser or the Parent to obtain any consent, approval permit or
action or waiver from, or make any filings with, or give any
notice to, any governmental body, or any other person; (iii)
violates any law or order of any governmental body against or
binding upon the Purchaser or the Parent; or (iv) violates and
results in the revocation suspension of any permit necessary for
the conduct of the Purchaser's or the Parent's business.
SECTION 4.4 LITIGATION. There are no claims, actions, suits,
----------
proceedings or investigations, whether legal or administrative,
at law or in equity, pending or the best of Purchaser or Parent's
knowledge threatened against the Purchaser or the Parent
involving or effecting the Purchaser's ability to perform its
obligations hereunder or under the other Transaction Documents to
which it is a party.
ARTICLE V
AGREEMENTS RELATING TO THE COLLECTION OF
ACCOUNTS RECEIVABLE
(a) All outstanding accounts receivable of the Company
on the date hereof (the "Receivables") shall be collected by
-----------
Purchaser on behalf of and for the account of the Company. The
Purchaser agrees to utilize the same level of collection efforts
that it would use in the ordinary course of the collection of
receivables for its own account, provided that Purchaser shall not
--------
be required in any event to bring any legal action or institute
other extraordinary collection efforts to collect Receivables.
Any payments of receivables received by Purchaser after the date
hereof shall be deemed to be received on a "first-in-first-out"
basis so that all such payments will be first credited towards
the Receivables due from a particular account debtor until the
entire amount of such account debtor's Receivables is paid in
full to the Company (after which time all receivables from such
account debtor shall be for Purchaser's account), provided, that
--------
if a particular payment of a receivable received by Purchaser
specifically indicates that it is in payment for services provided
after the date hereof, such receivable shall not be subject to this
Article V and may be retained by Purchaser, and provided further,
----------------
that any Receivables which are the subject of a dispute with the
applicable account debtor (a "Disputed Receivable") shall be
-------------------
segregated from other Receivables of such account debtor and do not
need to be collected prior to such account debtor's being deemed
to have been paid in full.
(b) The Purchaser will remit to the Company weekly,
commencing on a date two weeks after the date hereof, the
Receivables collected during the preceding week along with
documentation specifically identifying the client and the invoice
paid.
(c) Further, Purchaser will promptly ▇▇▇▇ on behalf of
the Company for any services performed prior to the effective
date of this Agreement but for which time cards were not
submitted either to the Company or Purchaser until after the
effective date of this Agreement. Purchaser will provide the
Company with copies of all invoices for services so billed and
will remit in accordance with the above paragraph (b) any monies
received for services performed prior to the effective date of
this Agreement. Subject to paragraph (a) of this Article V, all
revenues (whether billed or unbilled) generated for services
rendered by the Business prior to the effective date of this
Agreement belong to the Company, and all revenues generated by
the Assets for services rendered by Purchaser on and after the
effective date shall belong to the Purchaser.
(d) The Company shall not institute any legal action
or collection efforts with respect to a Disputed Receivable until
such Disputed Receivable remains unpaid for 90 days following the
date of the invoice. Prior to institution any such action or
effort, the Company shall notify Purchaser of its intent to
undertake same. If within 10 business days of notification,
Purchaser fails to collect the Disputed Receivable or notify the
Company that Purchaser is buying the Disputed Receivable from
Company for the face value, the Company is free to pursue
whatever collection efforts or legal action it deems appropriate
to collect the Disputed Receivable.
(e) Until all Receivables have been paid or purchased
by Purchaser, the Company and its accountants shall have the
right, upon reasonable notice, during normal business hours, to
examine the books and records of Purchaser relating to the
Receivables.
ARTICLE VI
INDEMNIFICATION
SECTION 6.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES OF THE
-------------------------------------------------
COMPANY AND ▇▇▇▇▇. Notwithstanding any right of Purchaser and
-----------------
Parent fully to investigate the affairs of the Company and any
knowledge of facts determined or determinable by Purchaser and
Parent pursuant to such investigation or right of investigation,
Purchaser and Parent each has the right to rely fully upon the
representations, warranties, covenants and agreements of the
Company and ▇▇▇▇▇ contained in this Agreement or in any
instrument delivered in connection with or pursuant to any of the
foregoing. All such covenants and agreements of the Company and
▇▇▇▇▇ shall survive the execution and delivery of this Agreement.
All of such representations and warranties made by the Company
and ▇▇▇▇▇ shall survive the execution and delivery of this
Agreement for a period of two (2) years following the date of
this Agreement; provided, that the representations and warranties
--------
made by the Company and ▇▇▇▇▇ in Section 3.2 with respect to due
authority shall survive the execution and delivery of this
Agreement.
SECTION 6.2 OBLIGATION OF THE COMPANY AND ▇▇▇▇▇ TO INDEMNIFY.
------------------------------------------------
The Company and ▇▇▇▇▇, jointly and severally, agree to indemnify,
defend and hold harmless Purchaser and Parent (and their
respective directors, officers, employees, affiliates,
successors, assigns and representatives) from and against all
Claims, losses, liabilities, damages, deficiencies, judgments,
settlements, costs of investigation or other expenses (including
interest, penalties and reasonable attorneys' fees and
disbursements and expenses incurred in enforcing this
indemnification or in any litigation between the parties or with
third parties) (collectively, the "Losses") suffered or incurred
------
by Purchaser, Parent or any of the foregoing persons arising out
of (a) any breach of the representations, warranties, covenants
and agreements of the Company or ▇▇▇▇▇ contained in this Agreement
or any Transaction Document, or (b) any Company Liability whether
arising prior to or after the date of this Agreement. The amount of
such indemnification shall be limited to the sum of the purchase
price paid hereunder and the aggregate amounts paid under the
Employment Agreement and the Noncompetition Agreement.
Notwithstanding anything to the contrary contained in this
Agreement and the Transaction Documents, neither the Purchaser
nor the Parent shall have any rights, remedies or recourse against
the Company or ▇▇▇▇▇ except to the extent that any breach or
Company Liability results in actual costs, expenses, liabilities
or damages to Purchaser or Parent.
SECTION 6.3 SURVIVAL OF REPRESENTATIONS AND WARRANTIES OF THE
-------------------------------------------------
COMPANY AND PARENT. All the representations and warranties made
------------------
herein by the Purchaser and/or the Parent shall survive the
execution and delivery of this Agreement for a period of two (2)
years following the date of this Agreement; provided, that the
--------
representations and warranties made by the Purchaser and the
Parent in Section 4.2 with respect to due authority shall survive
the execution and delivery of this Agreement.
SECTION 6.4 OBLIGATION OF PURCHASER AND PARENT TO INDEMNIFY.
-----------------------------------------------
The Purchaser and the Parent, jointly and severally, agree to
indemnify, defend and hold harmless the Company (and its
directors, officers, employees, affiliates, successors, assigns
and representatives) and ▇▇▇▇▇ from any and all Losses suffered
or incurred by the Company or ▇▇▇▇▇ or any of the foregoing
persons arising out of (a) any breach of the representations,
warranties, covenants and agreements of the Purchaser or the
Parent contained in this Agreement or in any Transaction
Document, or (b) any liability relating to the use of the
Purchased Assets or the conduct of the Business by Purchaser or
the Parent after the date hereof.
ARTICLE VII
MISCELLANEOUS
SECTION 7.1 EXPENSES. Except as otherwise specifically
--------
provided in this Agreement, the parties hereto shall bear their
respective expenses incurred in connection with the preparation,
execution and performance of this Agreement and the Transaction
Documents, including, without limitation, all fees and expenses
of their respective representatives.
SECTION 7.2 PUBLIC ANNOUNCEMENTS. Prior to and after the
--------------------
date of this Agreement, the Company and Purchaser will consult
with each other before issuing any press release or otherwise
making any public statement with respect to the Contemplated
Transactions, and will not issue any such press release or make
any such public statement without the prior approval of the
Company or Purchaser, as the case may be, except as may be
required by applicable Law in which event the other party shall
have the right to review and comment upon (but not approve) any
such press release or public statement prior to its issuance.
SECTION 7.3 FURTHER ASSURANCES. The Company on the one
------------------
hand, and Parent and Purchaser, on the other hand, hereby agree,
without further consideration, to execute and deliver at or
following the date hereof such instruments of transfer and take
such other action as the other parties may reasonably request in
order to put Purchaser in possession of, and to vest in
Purchaser, good, valid and unencumbered title to the Purchased
Assets in accordance with this Agreement and to otherwise give
effect to the Contemplated Transactions. After the date of this
Agreement, Purchaser and Parent shall afford reasonable access to
any and all charter documents and corporate records of the
Company which are in the Purchaser's or Parent's possession as
the Company or ▇▇▇▇▇ may from time to time reasonably request.
SECTION 7.4 DOCUMENTATION. Simultaneously herewith, the
-------------
Company is delivering to Purchaser the following:
(a) A certificate, dated contemporaneously herewith,
of the Secretary or Assistant Secretary of the Company
certifying, among other things, that attached or appended to such
certificate (i) is a true and correct copy of the Certificate of
Incorporation and by-laws (or comparable instruments) of the
Company, and all amendments if any thereto as of the date
thereof; (ii) are the names of the directors and officers of the
Company; (iii) is a true copy of all corporate actions taken by
the board of directors and the shareholders of the Company (which
actions shall have been taken prior to the date of entering into
this Agreement) to authorize the Contemplated Transactions; and
(iv) are the names and signatures of the duly elected or
appointed officers of the Company who are authorized to execute
and deliver this Agreement, the Transaction Documents to which
the Company is a party and any certificate, document or other
instrument in connection herewith.
(b) Possession and control of the Purchased Assets.
(c) ▇▇▇▇ of Sale executed by the Company conveying to
Purchaser all of the Purchased Assets being acquired hereunder,
free and clear of any and all Liens, substantially in the form of
Exhibit E hereto.
---------
(d) Good standing certificates for the Company from
the Secretary of State of the State of New York and each of the
jurisdictions in which the Company is qualified to do business as
a foreign corporation.
(e) A signed opinion of the Company's counsel, dated
contemporaneously herewith, addressed to Purchaser and Parent,
substantially in the form of opinion annexed as Exhibit F hereto.
---------
(f) A signed opinion of the Purchaser's and Parent's
counsel, dated contemporaneously herewith, addressed to the
Company and ▇▇▇▇▇, substantially in the form of opinion annexed
as Exhibit G hereto.
---------
(g) Copies of all Business books and records as
reasonably requested by Purchaser and related to the purchase of
Purchased Assets.
(h) The UCC-3 terminating the European American Bank
lien.
(i) A certificate to be filed by Purchaser on behalf
of the Company with the Department of State of the State of New
York canceling the Company's use and right to the Acquired Name
as a fictitious name of the Company.
(j) A check in the amount of $6,500 for the partial
purchase price of certain shares of the Parent's common stock
being purchased in connection with the Employment Agreement.
SECTION 7.5 NOTICES. (a) Any notice or other communication
-------
required or permitted hereunder shall be in writing and shall be
delivered personally by hand or by recognized overnight courier,
telecopied or mailed (by registered or certified mail, postage
prepaid) as follows:
(i) If to Purchaser or Parent, one copy to:
Paramount Financial Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇, Chief Executive
Officer
with a simultaneous copy to:
▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
(ii) If to the Company, one copy to:
RBW Staffing Resources Inc.
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier:
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇, President
with a simultaneous copy to:
▇▇▇▇▇, McClosky, Smith, Schuster& ▇▇▇▇▇▇▇,
P.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
(b) Each such notice or other communication shall be
effective (i) if given by telecopier, when such telecopy is
transmitted to the telecopier number specified in Section 7.5(a)
(with confirmation of such transmission), or (ii) when delivered
at the address specified in Section 7.5(a). Any party by notice
given in accordance with this Section 7.5 to the other party may
designate another address or person for receipt of notices
hereunder. Notices by a party may be given by counsel to such
party.
SECTION 7.6 ENTIRE AGREEMENT. This Agreement and the
----------------
collateral agreements executed in connection with the
consummation of the Contemplated Transactions contain the entire
agreement between the parties with respect to the subject matter
hereof and related transactions and supersede all prior
agreements, written or oral, with respect thereto.
SECTION 7.7 WAIVERS AND AMENDMENTS; NON-CONTRACTUAL REMEDIES;
------------------------------------------------
PRESERVATION OF REMEDIES. This Agreement may be amended,
------------------------
superseded, canceled, renewed or extended only by a written
instrument signed by the parties hereto. The provisions hereof
may be waived only in writing by the parties hereto. No delay on
the part of any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof, nor shall any waiver
on the part of any party of any such right, power or privilege,
nor any single or partial exercise of any such right, power or
privilege, preclude any further exercise thereof or the exercise
of any other such right, power or privilege. Except as otherwise
provided herein, the rights and remedies herein provided are
cumulative and are not exclusive of any rights or remedies that
any party may otherwise have at law or in equity.
SECTION 7.8 GOVERNING LAW. This Agreement shall be governed
-------------
and construed in accordance with the laws of the State of New
York applicable to agreements made and to be performed entirely
within such State, without regard to the conflict of laws rules
thereof.
SECTION 7.9 CONSENT TO JURISDICTION AND SERVICE OF PROCESS.
----------------------------------------------
The parties hereto irrevocably: (a) agree that any suit, action
or other legal proceeding arising out of this Agreement may be
brought in the courts of the State of New York or the courts of
the United States located in the State of New York, (b) consent
to the jurisdiction of each court in any such suit, action or
proceeding, (c) waive any objection which they, or any of them,
may have to the laying of venue of any such suit, action or
proceeding in any of such courts, and (d) waive the right to a
trial by jury in any such suit, action or other legal proceeding.
SECTION 7.10 FEES OF PREVAILING PARTY. If there is a dispute
------------------------
under this Agreement or the Transaction Documents, the prevailing
party shall be entitled to recover from the losing party all
reasonable attorneys' fees and costs incurred by it in the
resolution of such dispute.
SECTION 7.11 BINDING EFFECT; NO ASSIGNMENT. This Agreement
----------------------------
and all of its provisions, rights and obligations shall be
binding upon and shall inure to the benefit of the parties hereto
and their respective successors, heirs and legal representatives.
This Agreement may not be assigned (including by operation of
Law) by a party without the express written consent of Purchaser
and Parent (in the case of assignment by the Company or ▇▇▇▇▇) or
the Company (in the case of assignment by Purchaser or Parent)
and any purported assignment, unless so consented to, shall be
void and without effect; provided, that the benefits hereunder
--------
(but not the obligations) of Purchaser or Parent may be assigned
by Purchaser or Parent and the benefits hereunder (but not the
obligations) of Company may be assigned by the Company. Nothing
herein express or implied is intended or shall be construed to
confer upon or to give anyone other than the parties hereto and
their respective heirs, legal representatives and successors
any rights or benefits under or by reason of this Agreement and
no other party shall have any right to enforce any of the provisions
of this Agreement.
SECTION 7.12 EXHIBITS. All Exhibits attached hereto are
--------
hereby incorporated by reference into, and made a part of, this
Agreement.
SECTION 7.13 SEVERABILITY. If any provision of this
------------
Agreement for any reason shall be held to be illegal, invalid or
unenforceable, such illegality, invalidity or unenforceability
shall not affect any other provision of this Agreement, but this
Agreement shall be construed as if such illegal, invalid or
unenforceable provision had never been included herein.
SECTION 7.14 COUNTERPARTS. The Agreement may be executed in
------------
any number of counterparts, each of which shall be deemed to be
an original as against any party whose signature appears thereon,
and all of which shall together constitute one and the same
instrument. This Agreement shall become binding when one or more
counterparts hereof, individually or taken together, shall bear
the signatures of all of the parties reflected hereon as the
signatories.
IN WITNESS WHEREOF, the undersigned have executed this
------------------
Agreement as of the date set forth above.
RBW STAFFING RESOURCES INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: President
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇
PARAMOUNT FINANCIAL CORPORATION
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Chief Executive Officer
DELTAFORCE PERSONNEL SERVICES
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Chief Executive Officer