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EXHIBIT 10.6H
ASSET PURCHASE AGREEMENT
between
Factual Data Corp
and
C B Unlimited, Inc.
January 5, 1996
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ASSET PURCHASE AGREEMENT
TABLE OF CONTENTS
Page
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RECITALS 1
ARTICLE 1 - PURCHASE AND SALE
Section 1.1 - Assets to be Purchased 1
Section 1.2 - Purchase Price 4
ARTICLE 2 - REPRESENTATIONS AND WARRANTIES OF SELLER
Section 2.1 - Organization and Authority of Seller 4
Section 2.2 - Profit and Loss Statements 4
Section 2.3 - Properties 5
Section 2.4 - Contracts 5
Section 2.5 - Inventories 6
Section 2.6 - Taxes 6
Section 2.7 - No Adverse Change 6
Section 2.8 - Contracts and Commitments 6
Section 2.9 - Litigation 7
Section 2.10 - Curtailment Notices 7
Section 2.11 - No Change in Condition 7
Section 2.12 - Assets Complete 8
Section 2.13 - Compliance with Law 8
Section 2.14 - Hazardous Substances 9
Section 2.15 - Other Government Payments;
Utility Payments 10
Section 2.16 - Insurance Policies 10
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Page
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ARTICLE 3 - REPRESENTATIONS AND WARRANTIES OF BUYER
Section 3.1 - Organization and Authority 11
ARTICLE 4 - COVENANTS OF SELLER PENDING CLOSING DATE
Section 4.1 - Covenants 12
ARTICLE 5 - COVENANTS OF BUYER PENDING CLOSING DATE
Section 5.1 - Covenants 13
ARTICLE 6 - CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS
Section 6.1 - Approval 14
Section 6.2 - Compliance 14
ARTICLE 7 - CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS
Section 7.1 - Approvals 14
Section 7.2 - Compliance 14
Section 7.3 - Assurances 15
Section 7.4 - Loss or Damage to Assets 16
ARTICLE 8 - CLOSING
Section 8.1 - Closing Date 16
Section 8.2 - Actions 16
ARTICLE 9 - ADDITIONAL COVENANTS OF SELLER AND BUYER
Section 9.1 - Consents 17
Section 9.2 - Additional Assistance 17
Section 9.3 - Ratings and Deposits 18
Section 9.4 - Costs 18
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Page
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Section 9.5 - Records 18
Section 9.6 - Additional Commitments 19
Section 9.7 - Claims 19
ARTICLE 10- INDEMNIFICATION; EXPIRATION OF CLAIMS; SET-OFF
Section 10.1 - Indemnity by Seller 20
Section 10.2 - Indemnity by Buyer 20
Section 10.3 - Expiration of Warranty Claims
and Limitations 21
Section 10.4 - Set-Off 21
ARTICLE 11- TERMINATION OF AGREEMENT
Section 11.1 - Basis for Termination 21
Section 11.2 - Notice of Termination 22
Section 11.3 - Costs 22
ARTICLE 12- MISCELLANEOUS PROVISIONS
Section 12.1 - Orderly Transition 23
Section 12.2 - Notices 23
Section 12.3 - Headings 24
Section 12.4 - Nonwaiver 24
Section 12.5 - Assignment 24
Section 12.6 - Binding Effect 24
Section 12.7 - Severability 25
Section 12.8 - Applicable Law 25
Section 12.9 - Entire Agreement 25
Section 12.10 - Amendment and Modification 25
Section 12.11 - Counterparts 26
SIGNATURES 26
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ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement is entered into as of January 5, 1996
between Factual Data Corp, a Colorado corporation (the "Seller"), and C B
Unlimited, Inc., an Ohio corporation (the "Buyer").
RECITALS
A. The Seller has developed and now owns and franchises a credit review
and reporting business known as "Factual Data". The Seller itself owns and
operates the Factual Data franchise for the territory of the State of Indiana
and runs that franchise out of offices in Indianapolis, Indiana at ▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇. The Seller desires to appoint
the Buyer as the Factual Data franchisee for the territories of Indiana, western
Pennsylvania, and West Virginia, and the Buyer desires to accept that
appointment, by a separate franchise agreement. The Seller also desires to
appoint the Buyer as a franchisee for its "Outsource" and "EmpFacts" products,
and the Buyer desires to accept those appointments, by separate agreements. The
Seller desires to sell to the Buyer certain assets of the current Factual Data
franchise operation for Indiana now owned by the Seller on the terms and
conditions of this Agreement.
B. The Buyer desires to purchase those Indiana Factual Data franchise
assets on the terms and conditions of this Agreement.
ARTICLE 1
PURCHASE AND SALE
1.1 Assets to be Purchased.
(a) The Seller agrees to sell to the Buyer, and the Buyer agrees to
purchase from the Seller, the following assets, as they shall exist at the
Closing Date defined below, of the Seller's operation of Factual Data in the
territory of
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Indiana, except as they may be covered by the Factual Data franchise agreement
for the Indiana territory between the Seller and the Buyer (the "Assets"). The
effective date of the purchase and sale of the Assets shall be January 1, 1996.
i) All equipment, furniture, and other personal property.
ii) All supplies.
iii) All work-in-process and completed, but unbilled, work.
iv) All records, data, documents, and information concerning the
business of the Seller, including without limitation customer
and supplier lists and files, sales brochures, marketing
materials and records, price lists, costing procedures,
production records, pricing formulas, sales orders unfulfilled
at the Closing Date, manuals, and any other tangible property
used in connection with the business of the Seller.
v) All intangible property used in or related to the business
conducted by the Seller, including without limitation good
will.
vi) Everything else used in connection with the business of the
Seller or either necessary for the effective and profitable
operation of the business or held for disposition, use, or
consumption in the business conducted by the Seller.
(b) There shall be excluded from the Assets listed above to be sold and
purchased the following items related to the Indiana Factual Data business of
the Seller.
i) All corporate records, minute books, stock record books, and
corporate seals of the Seller.
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ii) All the tax returns and supporting schedules of the Seller.
iii) Any and all rights which accrue to, or will in the future
accrue to, the Seller under this Agreement.
iv) All cash, prepaid expenses, accounts receivable, and life
insurance policies.
v) All items covered by the Factual Data franchise agreement for
the Indiana territory between the Seller and the Buyer.
(c) The Assets shall be transferred by the Seller to the Buyer free and
clear of all liabilities, obligations, liens, and encumbrances and in their
present state or condition, ordinary wear and tear excepted.
(d) The Seller shall prepare and deliver to the Buyer by the Closing
complete list(s) of all the personal property being purchased and sold, as
requested by the Buyer.
1.2 Purchase Price.
(a) As full payment for the Assets and of the initial franchise fees
for the franchise agreements to be executed at the Closing, the Buyer shall pay
the Seller in cash $250,000.00 on or before January 19, 1996 and $230,000.00 on
or before March 15, 1997. The obligation of the Buyer to pay these amounts to
the Seller shall be further evidenced by a promissory note to be executed by the
Buyer at the Closing, which note shall contain a discount off the total purchase
price for periodic payments made during 1996 and before its maturity date.
(b) The Buyer shall not assume nor agree to pay any other debts,
liabilities, or obligations of the Seller, including without limitation any
amounts owing to any governmental entities, any employee liabilities, or any
unfunded pension plan liabilities.
(c) The Buyer shall not be responsible for paying any brokerage fees or
commissions in connection with this purchase and sale transaction.
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ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF SELLER
The Seller represents, warrants, and covenants as follows.
2.1 Organization and Authority of Seller.
(a) Seller is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Colorado.
(b) With respect to the Indiana Factual Data business, the Seller has
full corporate power and authority to own or hold under lease or similar
agreement properties and assets it now owns or holds under lease or agreement
and to carry on its business as it is now being conducted.
(c) Seller has full corporate power and authority, and has received all
requisite approval by its board of directors and its shareholders, to enter into
this Agreement and to carry out the transaction contemplated by it.
(d) The execution and delivery of this Agreement and the consummation
of the transaction contemplated by it do not and will not violate any provision
of Seller's certificate of incorporation or by-laws, or any provision of, or
result in the acceleration of any obligation under, any mortgage, lien, lease,
agreement, franchise agreement, instrument, court or administrative order,
arbitration award, judgment, or decree to which Seller is a party or by which it
is bound and will not violate any other restriction of any kind to which it is
subject.
2.2 Profit and Loss Statements.
The Seller has delivered to the Buyer copies of its profit and loss
statements for 1993, 1994, and January through October 1995 inclusive, for its
Indiana Factual Data business. These statements present fairly the profits and
losses for the periods covered.
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2.3 Properties.
With respect to its Indiana Factual Data business, the Seller has good
and marketable title to all its properties and assets owned, and good right to
use and occupy such properties and assets leased, both real and personal, free
and clear of all liens, charges, and encumbrances, except (i) such imperfections
of title, liens, charges, easements, and encumbrances as are not material to the
business operations or financial condition of Seller, (ii) for liens for taxes
not yet due and payable or being contested in good faith by appropriate
proceedings, and (iii) for liens already disclosed to the Buyer. The current use
of said real properties and the improvements thereon are not in violation of any
applicable zoning laws, ordinances, or regulations, or, to the best of Seller's
knowledge, any other applicable laws, ordinances or regulations.
2.4 Contracts.
With respect to its Indiana Factual Data business, the Seller has not
breached any material provision of, or is not in default in any material respect
under the terms of, any contract, agreement, plan, lease, or license, a breach
of which, or a default under which, would have a material adverse effect upon
the business or financial condition of Seller's Indiana Financial Data
operations. Seller shall furnish to Buyer upon request before the Closing a
schedule that describes all material contracts, plans, leases, licenses,
judgments, decrees, joint venture agreements, or other arrangements to which
Seller is a party, and under which consent or approval may be required from
third parties in order that no default thereunder or breaches thereof will occur
as a consequence of consummation of the transaction provided for herein or in
order effectively to transfer to or vest in Buyer good and sufficient title to
assets or property rights of Seller, or in order otherwise duly to effect the
succession of Buyer to the status and position of Seller with respect thereto.
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2.5 Inventories.
The supplies inventories of Seller consist of items, valued at cost or
market, whichever is lower, that are saleable or usable in the ordinary course
of business in quantities and amounts not in excess of the reasonable needs of
the business.
2.6 Taxes.
With respect to the Seller's Indiana Factual Data business, the Seller
has filed all state, local and other governmental tax returns and similar
reports are as required to be filed, and has made all state, local, and other
governmental tax payments as are required to be made.
2.7 No Adverse Change.
Since the dates of the above profit and loss statements there has not
been any material adverse change in the business or financial condition of the
Seller.
2.8 Contracts and Commitments.
With respect to the Seller's Indiana Factual Data business, the Seller
shall deliver to Buyer upon request before the Closing a list showing all of the
following types of material contracts and commitments to which Seller is a
party. Except as set forth on such list or contemplated by this Agreement,
Seller is not a party to any written or oral (i) contract for the employment of
any officer or any individual employee1 or any consulting or similar agreement,
not terminable by it without liability upon thirty (30) days or less notice,
(ii) contract with any labor union, (iii) pension, profit-sharing, bonus,
retirement, stock option, or similar plan or arrangement, (iv) contract for the
future purchase of materials, supplies, or equipment or for the receipt of
services in excess of its requirements for its normal business operations, (v)
contract not made in the ordinary course of business for the sale of products or
lease of products or equipment or rendition of services to others of more than
one year from the date hereof, (vi) loan or financing agreement or arrangement,
(vii) contract or arrangement under which Seller has assumed, guaranteed, or
endorsed or otherwise become liable in connection with the obligation by any
third party,
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(vii) lease of any real or personal property from others not terminable by
Seller without liability upon thirty (30) days or less notice, (ix) continuing
obligations under third-party lease arrangements, or (x) material contracts not
made in the ordinary course of business.
2.9 Litigation.
There is no litigation, arbitration, proceeding, or governmental
investigation pending or, to the knowledge of Seller's officers, threatened, the
outcome of which would materially adversely affect the business, financial
condition, or operations of Seller's Indiana Factual Data operations. There is
no outstanding citation, order, writ, injunction, or decree of any court,
government, or governmental agency against or affecting Seller, or the assets or
business of Seller, which might have a material adverse effect on the business
or financial condition of Seller's Indiana Factual Data operations.
2.10 Curtailment Notices.
Seller has not received any notice from suppliers, including utilities,
of curtailment of services or supplies.
2.11 No Change in Condition.
With respect to the Indiana Factual Data business, since the dates of
the above profit and loss statements the Seller has not suffered any
extraordinary loss or waived any right of substantial value; nor has Seller,
except in the ordinary course of business:
i) Incurred any material liability or obligation, under
agreements or otherwise, or issued or agreed to issue any
promissory notes;
ii) Sold or transferred any material tangible or intangible asset;
mortgaged, pledged, or subjected to any lien, charge, or other
encumbrance any such asset; entered into any material lease of
real property, equipment,
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or building; or cancelled any material debts or claim; or
iii) Entered into any material transaction, except in connection
with the execution and performance of this Agreement or the
transaction contemplated by this Agreement.
2.12 Assets Complete.
Except as otherwise contemplated by or provided for in this Agreement,
the Assets to be sold and purchased include all the assets being used in the
conduct of or related to the Indiana Factual Data business of the Seller as
presently conducted, except the assets covered by the Financial Data franchise
agreement between the Seller and the Buyer.
2.13 Compliance with Law.
The Seller's Indiana Factual Data business, properties, and offices do
not exist or operate in violation of any federal, state, or local code, law,
regulation, or ordinance regulating zoning, city planning, fire safety,
environmental protection, health, welfare, sanitation, hazardous waste, toxic
material, occupational safety and health, building codes, equal employment
opportunity, or similar matters applicable to its Indiana Factual Data business,
properties, or operations as presently conducted. All permits, licenses,
franchises, consents, and other authorizations necessary for the conduct of the
Seller's Indiana Factual Data business have been timely obtained and are
currently in effect. The Seller is not in violation of any term or provision of
any such permit, license, franchise, consent, or other authorization. The Seller
is not aware of any proposed laws, rules, regulations, ordinances, orders,
judgments, decrees, government takings, condemnations, or other proceedings
which would be applicable to its Indiana Factual Data business, operations, or
properties and which might adversely affect its properties, assets, liabilities,
operations, or prospects, either before or after the Closing. Seller shall
deliver to Buyer upon request before the closing a list showing all licenses and
permits issued by applicable governmental authorities presently held by the
Seller with respect to its Indiana Factual Data operations.
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2.14 Hazardous Substances.
With respect to the Seller's Indiana Factual Data business:
(a) No "Hazardous Substance" (as defined below) has been disposed of
on, generated on, treated on, buried beneath, or percolated beneath, and no such
disposal, generation, treatment, burial, or percolation has been threatened in
or near, any real estate owned or leased by the Seller or any improvements
thereon (collectively, the "real Property"), nor has a "reportable quantity" (as
defined below) of any hazardous Substance ever been removed from and stored
off-site of the Real Property. There has been no "Release" (as defined below) of
a reportable quantity of any Hazardous Substance on or from the Real Property.
The Seller and all owners and users of the Real Property are in compliance with
all applicable federal, state and local laws, administrative rulings and
regulations of any court, administrative agency, or other governmental or
quasi-governmental authority relating to the protection of the environment,
including, but not limited to, laws prohibiting the creation of a public
nuisance. Neither the Seller nor any owner or user of the Real Property is a
potentially responsible party under Section 107 of the Comprehensive
Environmental Response Compensation and Liability Act of 1980, as amended
("CERCLA") or Section 7003 of the Resource Conservation and Recovery Act of
1976, as amended ("RCRA"), and the Company has not received notification from
any federal, state or local government agency or regulatory body of a violation
under any federal, state or local law regulating the disposal or discharge of
any toxic, explosive, or other Hazardous Substance. For purposes of this
section:
i) "Hazardous Substance" means any one or more of the following:
(a) any substance deemed hazardous under Section 101(14) of
CERCLA; (b) any other substance deemed hazardous by the United
States Environmental Protection Agency pursuant to Section
102(a) of CERCLA; (c) petroleum, including crude oil
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or any fraction thereof; (d) any substance deemed hazardous
pursuant to Section 1004(5) of RCRA; or (e) any other
hazardous or toxic substance, materials, compound mixture,
solution, element, pollutant, or waste regulated under any
federal, state or local statute, ordinance, or regulation.
ii) "Release" shall have the meaning given to such term in Section
101(22) of CERCLA.
iii) "Reportable quantity" shall have the meaning given to such
term in, and shall be those quantities specified by the
Administrator of the United States Environmental Protection
Agency pursuant to, Section 102 of CERCLA.
(b) The properties of the Seller are free from the presence and/or
harmful effects of asbestos or asbestos-containing materials.
2.15 Other Government Payments; Utility Payments.
With respect to its Indiana Factual Data business, the Seller has made
all federal FICA payments, all federal, state and local withholding payments,
all federal, state, and local unemployment compensation payments, all state and
local sales tax payments, all worker's compensation premiums, and all gas,
electric, water, and other utility payments.
2.16 Insurance Policies.
Seller maintains insurance policies in effect in such types and amounts
and with such carriers as are appropriate for its Indiana Factual Data business.
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ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF BUYER
The Buyer represents, warrants, and covenants as follows.
3.1 Organization and Authority
(a) Buyer is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Ohio. Buyer is authorized or
qualified to transact business in Indiana, Pennsylvania, and West Virginia, or
shall become so as soon as possible following the execution of this Agreement.
(b) Buyer has full corporate power and authority, and has received all
requisite approval by its board of directors and its shareholders, to enter into
this Agreement and to carry out the transactions contemplated by it.
(c) The execution and delivery of this Agreement and the consummation
of the transaction contemplated by it do not and will not violate any provision
of Buyer's certificate of incorporation or by-laws, or any provision of, or
result in the acceleration of any obligation under, any mortgage, lien, lease,
agreement, instrument, court order, arbitration award, judgment, or decree to
which Buyer is a party or by which it is bound and will not violate any other
restriction of any kind to which it is subject.
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ARTICLE 4
COVENANTS OF SELLER PENDING CLOSING DATE
4.1 Covenants.
From the date of this Agreement until the Closing Date, the Seller
shall, with respect to its Indiana Factual Data business:
i) Continue to conduct its business in its usual manner;
ii) Give Buyer's representatives full access, during normal
business hours and upon reasonable notice, to all Seller's
assets, properties, books, records, agreements, and
commitments, and furnish Buyer's representatives during such
period with all such information concerning Seller's affairs
as Buyer may reasonably request; provided, however, that any
furnishing of such information to Buyer or any investigation
by Buyer shall not affect Buyer's right to rely on the
representations and warranties made by Seller in the
Agreement; Buyer agrees to exercise the same care in handling
such information as it would exercise with similar information
of its own; and, if the acquisition contemplated by this
Agreement is not consummated, to use its best efforts to
return to Seller all documents which Seller supplied to Buyer;
iii) Maintain in full force and effect insurance policies providing
coverage and amounts of coverage comparable to the coverage
and amounts of coverage provided under its policies of
insurance now in effect;
iv) Use its best efforts to take all necessary corporate and other
action and to obtain all
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consents, approvals, and amendments of agreements required of
it to carry out the transaction contemplated by this Agreement
and to satisfy the conditions specified herein;
v) Use its best efforts to assist the Buyer in obtaining an
adequate and capable work force to continue the business of
the Seller on terms satisfactory to the Buyer; and
vi) Immediately prior to the Closing, the Seller shall terminate
all employees of its Indiana Factual Data business.
ARTICLE 5
COVENANTS OF BUYER PENDING CLOSING DATE
5.1 Covenants.
From the date of this Agreement until the Closing Date the Buyer shall:
i) Use its best efforts to take all necessary corporate and other
action and to obtain all consents, approvals, and amendments
of agreements required of it to carry out the transaction
contemplated by this Agreement and to satisfy the conditions
specified herein; and
ii) Use its best efforts to obtain an adequate and capable work
force to continue the business of the Seller on terms
satisfactory to the Buyer.
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ARTICLE 6
CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS
The obligations of the Seller under this Agreement are subject to
satisfaction of the following conditions at or before the Closing.
6.1 Approvals.
The transaction shall have been approved by the shareholders and
directors of the Buyer.
6.2 Compliance.
All of the covenants, terms, and conditions of this Agreement to be
complied with and performed by Buyer at or before the Closing Date shall have
been complied with and performed in all material respects, and the
representations and warranties made by Buyer in this Agreement shall be correct
in all material respects at and as of the Closing Date with the same force and
effect as though such representations and warranties had been made at and as of
the Closing Date. Any representation or warranty which by its terms is made with
reference to a specific date shall have been correct in all material respects as
of such date. Buyer shall have delivered to Seller a certificate, dated the
Closing Date, signed by the President of Buyer, certifying, to the best of his
knowledge after reasonable investigation, to the fulfillment of the requirements
referred to in this Section.
ARTICLE 7
CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS
The obligations of the Buyer under this Agreement are subject to
satisfaction of the following conditions at or before the Closing Date.
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7.1 Approvals.
The transaction shall have been approved by the shareholders and
directors of the Seller.
7.2 Compliance.
All of the covenants, terms, and conditions of this Agreement to be
complied with and performed by Seller at or before the Closing Date shall have
been complied with and performed in all material respects, and the
representations and warranties made by Seller in this Agreement shall be true
and correct in all material respects, at and as of the Closing Date, with the
same force and effect as though such representations and warranties had been
made at and as of the Closing Date. Any representation or warranty which by its
terms is made with reference to a specific date shall have been correct in all
material respects as of such date. Seller shall have delivered to Buyer a
certificate of Seller, dated the Closing Date, signed by the President or the
Executive Vice President of Seller, certifying to the fulfillment of the
requirements referred to in this Section.
7.3 Assurances.
Buyer (i) shall have been assured of retaining an adequate and capable
work force to continue the Indiana Factual Data business of the Seller on terms
satisfactory to it and (ii) shall have received bank financing for the
transaction and for working capital purposes following the purchase in amount(s)
and on terms satisfactory to it.
7.4 Loss or Damage to Assets.
There shall be no loss or damage to the Assets except in the ordinary
course of business. In the event that there is any loss or damage to the Assets
not in the ordinary course of business, the Buyer shall have the option of (i)
requiring the Seller to pay the cost of repairing such damage and/or receiving
the proceeds of insurance payable by reason thereof and consummating the
transaction contemplated by this Agreement at no reduction in the purchase price
set forth above, or (ii) terminating this Agreement, in which latter event the
parties shall be released from further obligations to each other.
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ARTICLE 8
CLOSING
8.1 Closing Date.
The sale and purchase of the Assets (the "Closing") shall take place at
such time, of such date, and at such place as shall be agreed by the parties.
Such date and time of closing are referred to as the "Closing Date".
8.2 Actions.
At the Closing on the Closing Date the following actions shall take
place.
i) The Seller shall deliver the Assets to the Buyer. The sale,
transfer, and delivery of the Assets to the Buyer shall be
effected by appropriate bills of sale, assignments,
endorsements, or other appropriate instruments as the Buyer or
its counsel shall request. The Buyer shall be entitled to
physical possession of the Assets as of the time of Closing.
ii) The Buyer shall sign and deliver to the Seller the promissory
note referred to in Subsection 1.2(a) above.
iii) The Buyer and the Seller shall each deliver to the other the
certificates required by Articles 6 and 7 above.
iv) The Seller and the Buyer shall enter into (a) a franchise
agreement for the Factual Data franchise for the territories
of Indiana, western Pennsylvania, and West Virginia, and (b)
agreements for the Seller's "Outsource" and "EmpFacts"
products.
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ARTICLE 9
ADDITIONAL COVENANTS OF SELLER AND BUYER
9.1 Consents.
To the extent that the assignment of any contract, license, lease,
commitment, sales order, or purchase order to be assigned to Buyer shall require
the consent of the other party thereto, this Agreement shall not constitute an
agreement to assign the same if an attempted assignment would constitute a
breach hereof. Seller shall use its best efforts in each case to obtain the
consent of the other party to the assignment to Buyer. If such consent is not
obtained, Seller will cooperate with Buyer in any reasonable arrangement
designed to provide for Buyer the benefits under any such contracts, licenses,
leases, commitments, sales orders, or purchase orders. In the event reasonable
arrangements cannot be made to provide Buyer such benefits, Buyer shall not
assume or have any liability thereunder and an adjustment shall be made in the
purchase price of the Assets.
9.2 Additional Assistance.
The Seller shall, at any time and from time to time at and after the
Closing Date, upon request of Buyer, take any and all steps necessary to place
Buyer in possession and operating control of the Assets and business to be
transferred hereunder and will do, execute, acknowledge, and deliver all such
further acts, deeds, assignments, transfers, conveyances, powers of attorney,
and assurances as may be required for the better transferring and confirming to
Buyer the Assets. Buyer shall execute and deliver such instruments of assumption
and other documents as are reasonably requested by Seller confirming the
assumption by Buyer of the liabilities, obligations, and commitments assumed or
agreed to be performed by Buyer under this Agreement.
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9.3 Ratings and Deposits.
The Seller shall take all action reasonably requested by Buyer to
enable it to succeed to the Workmen's Compensation and Unemployment Insurance
ratings and other interests of Seller and other ratings for insurance or other
purposes established by Seller. Buyer shall not be obligated to succeed to any
such rating, deposit, or other interest, except as it may elect to do so.
9.4 Costs.
The Buyer and the Seller shall each pay its own costs and expenses
incident to the preparation of this Agreement and the consummation of the
transaction contemplated by it, including any sales, use, or deed recording,
transfer or similar taxes, if any, imposed upon it by law.
9.5 Records.
Seller shall, and shall cause its counsel and its certified public
accountants to, afford to the representatives of Buyer, including its counsel
and accountants, reasonable access to any records retained by it. Buyer shall,
and shall cause its counsel and its certified public accountants to, afford to
the representatives of Seller, including its counsel and accountants, reasonable
access to all records, files, and documents transferred by Seller to Buyer in
order to permit Seller to prepare its federal and state income tax returns and
for other reasonable purposes and shall afford Seller reasonable assistance in
connection therewith or in connection with claims and litigation. The parties
shall cause such records to be retained for not less than six (6) years after
the Closing Date, and neither Seller nor Buyer shall dispose of any such records
without first offering them in writing to the other party.
9.6 Additional Commitments.
(a) With respect to the Factual Data franchise for the territory of
Ohio, for so long as the Factual Data franchise agreement between the Seller and
the Buyer for the territories of Indiana, western Pennsylvania, and West
Virginia shall remain
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in effect, and the Buyer shall not be in material breach of that agreement:
i) If the Buyer and the franchisee for the Ohio Factual Data
franchise agree that the Buyer will purchase that franchise,
the Seller shall consent to that purchase; and
ii) If the franchisee for the Ohio Factual Data franchise offers
or proposes to sell or transfer that franchise to the Seller,
the Seller shall notify the Buyer of the proposal or offer
promptly upon receipt from the franchisee and shall give the
Buyer a right of first refusal to meet the terms of the
proposal or offer with a reasonable amount of time to do so.
(b) Following the Closing the Seller and the Buyer shall negotiate in
good faith an agreement covering the Buyer's right to use the Seller's
"CORPdata" and "second mortgage" products.
9.7 Claims.
The Seller shall be solely responsible for all costs, expenses, losses,
and damages resulting from claims regarding work done by the Seller prior to the
Closing.
ARTICLE 10
INDEMNIFICATION; EXPIRATION OF CLAIMS; SET-OFF
10.1 Indemnity by Seller
Seller shall indemnify and hold Buyer harmless after the Closing Date
against any and all loss, cost, damage, or deficiency, including reasonable
attorneys fees, resulting from, arising out of, or connected with any
misrepresentation, breach of warranty, or nonfulfillment of any agreement on the
part of Seller under this Agreement and from any misrepresentation in, or
occasioned by, any certificate furnished or to be furnished by Seller to Buyer.
In the event that any third person, including any governmental taxing authority,
shall assert any claim against Buyer which, if successful, might result in a
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breach or default by Seller in a representation, covenant, or warranty, Seller
shall have the right to participate in the defense and to be represented, at
Seller's expense, by advisory counsel to be selected by Seller, and Buyer agrees
not to compromise or settle such claim without first consulting with Seller.
10.2 Indemnity by Buyer.
Buyer shall indemnify and hold Seller harmless after the Closing Date
against any and all loss, cost, damage, or deficiency, including reasonable
attorneys fees, resulting from, arising out of, or connected with any
misrepresentation, breach of warranty, or nonfulfillment of any agreement on the
part of Buyer under this Agreement, and from any misrepresentation in, or
occasioned by, any certificate or other instrument furnished or to be furnished
by Buyer to Seller. In the event that any third person, including any
governmental taxing authority, shall assert any claim against Seller which, if
successful, might result in a breach or default by Buyer, Buyer shall have the
right to participate in the defense and to be represented, at Buyer's expense,
by advisory counsel to be selected by Buyer and Seller agrees not to compromise
or settle such claim without first consulting with Buyer.
10.3 Expiration of Warranty Claims and Limitations.
All claims for damages for breach of warranties, representations, or
covenants, whether contained in this Agreement or in any writing, schedule, ▇▇▇▇
of sale, assignment, or other documents of transfer, or other writings or
documents in any way relating to this transaction, shall expire one (l)year
after the Closing Date, except for written itemized claims specifying each
alleged breach and amount of claimed damages for each alleged breach, filed
prior to such expiration date.
10.4 Set-Off.
In the event that the Buyer suffers any loss, cost, damages or
deficiency as a result of any misrepresentation, breach of warranty, breach of a
covenant, or nonfulfillment of any agreement by the Seller under this Agreement,
the Buyer shall be entitled to set off that amount against any payments which
may be due from the Buyer to the Seller under this Agreement.
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ARTICLE 11
TERMINATION OF AGREEMENT
11.1 Basis for Termination.
This Agreement may be terminated at any time after its full execution
but before the Closing Date as follows.
i) By the mutual consent of the Seller and the Buyer.
ii) If the Closing has not taken place by January 19, 1996, by
either the Buyer or the Seller.
iii) If any of the conditions provided in Article 6 have not been
met by the Closing Date and have not been waived by the
Seller.
iv) If any of the conditions provided in Section 7 have not been
met by the Closing Date and have not been waived by the Buyer.
v) If any list or schedule to be delivered by the Seller to the
Buyer under this Agreement before the Closing Date discloses,
in the opinion of the Buyer, any matter which would have a
material adverse effect upon the Assets or Indiana Factual
Data business of the Seller, considered as a whole, and if
following notice by the Buyer to the Seller the Seller has not
corrected the matter so as to eliminate the material adverse
effect to the satisfaction of the Buyer before the Closing
Date, this Agreement may be terminated by the Buyer.
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vi) If there is a material adverse change in the Indiana Factual
Data business or future prospects, or in the levels of work or
orders, of the Seller, by the Buyer.
11.2 Notice of Termination.
The termination of this Agreement by either the Seller or the Buyer
under this Article 11 shall be accomplished by the provision of written notice
to that effect by one party to the other.
11.3 Costs.
In the event of the termination of this Agreement under this Article,
neither the Seller nor the Buyer shall have any liability to the other party for
any of costs, expenses, losses, damages, or otherwise.
ARTICLE 12
MISCELLANEOUS PROVISIONS
12.1 Orderly Transition.
The parties shall cooperate fully to provide a smooth and orderly
transition of the Assets and Indiana Factual Data business from the Seller to
the Buyer.
12.2 Notices.
All notices, requests, demands, and other communications required or
permitted by this Agreement shall be in writing and shall be considered to have
been given when delivered by hand or sent by certified mail, return receipt
requested, to the following addresses:
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(i) In the case of Seller, to:
▇▇. ▇. ▇. ▇▇▇▇▇▇
President
Factual Data Corp
3665 J.F.K. Parkway
Building One, Suite 200
Fort ▇▇▇▇▇▇▇, Colorado 80525
With a copy to:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
March & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(ii) In the case of Buyer, to:
▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
President
C B Unlimited, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
With a copy to:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Porter, Wright, ▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
or to such other person or address as either party shall notify the
other party in writing as set forth above.
12.3 Headings.
The headings of the sections in this Agreement are inserted for
convenience only and shall not constitute a part of this Agreement.
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12.4 Nonwaiver.
No delay or failure by any party to this Agreement to exercise any
right under it, and no partial or single exercise of any right, shall constitute
a waiver of that or any other right.
12.5 Assignment.
This Agreement may not be assigned, in whole or in part, by either
party without the express written consent of the other party.
12.6 Binding Effect.
This Agreement shall be binding upon, and shall inure to the benefit
of, the successors, representatives, heirs, and assigns of the parties.
12.7 Severability.
If any term or condition of this Agreement shall to any extent be
invalid or unenforceable, the remainder of this Agreement shall not be affected
thereby. Each term and condition of this Agreement shall be valid and
enforceable to the fullest extent permitted by law.
12.8 Applicable Law.
This Agreement shall be governed by, and construed in accordance with,
the laws of the State of Colorado.
12.9 Entire Agreement.
This document embodies the entire agreement among the parties to it
with respect to the transaction contemplated by it. There have never been and
are no agreements, representations, or warranties among the parties other than
those set forth or provided for in it. This Agreement supersedes any prior
agreements, understandings, or letters of intent between or among the parties
with respect to the subject matter of it.
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12.10 Amendment and Modification.
The parties may amend, modify, and supplement this Agreement in any
manner as may be mutually agreed upon among them in writing.
12.11 Counterparts.
This Agreement may be executed in more than one counterpart, each of
which shall be considered an original but all of which together shall constitute
one and the same document.
THIS ASSET PURCHASE AGREEMENT has been executed by the duly authorized
representatives of the parties as of the date first written above.
FACTUAL DATA CORP
By: /s/ ▇.▇. ▇▇▇▇▇▇
----------------------
▇.▇. ▇▇▇▇▇▇
President
C B UNLIMITED, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
----------------------
▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
President
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MODIFICATION AND EXTENSION AGREEMENT
This Modification and Extension Agreement is made effective as of the
15th day of March, 1997, between FACTUAL DATA CORP ("Payee") and C B Limited,
Inc., an Ohio Corporation and ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇. ("Makers").
RECITALS
1. On January 5, 1996 the parties entered into an Asset Purchase
Agreement by which Makers acquired from Payee certain assets of the Factual Data
franchise operation for Indiana and by separate documents Makers also acquired
from Payee franchises for Factual Data, Outsource and EmpFacts products, all of
which will be referred to collectively as the "Assets".
2. As part of the purchase price for the Assets, Makers signed a
Promissory Note dated January 16, 1996 in the principal amount of $230,000.00
payable, without interest, on March 15, 1997, with Makers reserving the right to
make prepayment including periodic installment payments as shown by the terms of
said Promissory Note. No prepayments were made on the Promissory Note and the
unpaid principal balance is still $230,000.00.
3. Makers have requested an extension of time for paying the principal
amount and Payee is willing to modify and extend the Promissory Note upon the
conditions set forth below.
4. Payee was intending to pay its corporate income tax liabilities to
various states and to the Internal Revenue Service for itself and related
entities with the proceeds from
31
the Promissory Note payment. Payee will now be unable to make such payments in a
timely manner and will be assessed a one percent (1%) nonpayment penalty per
month and one percent (1%) per month interest on all taxes due.("The Late
Payment Penalties and Interest")
NOW THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties agree to be bound as
follows:
Payment of Principal: The unpaid principal balance of $230,000.00 shall
be paid as follows: Prior to March 15, 1997, Makers shall pay the sum of
$35,000.00 to Payee. The remaining unpaid principal balance of $195,000.00 shall
be due and payable on or before September 30, 1997.
Payment of Interest: The unpaid principal balance of $195,000.00 shall
accrue interest at the rate of 18% per annum commencing March 15, 1997. Interest
payments shall be made monthly commencing April 15, 1997 and continuing on the
15th of each month thereafter until the principal has been paid in full. The
remaining accrued and unpaid interest shall be due and payable, together with
the remaining unpaid principal balance, on September 30, 1997.
Late Payment Penalties and Interest: As further consideration for the
extension of the due date under the terms of the Promissory Note, Makers agree
to pay the actual Late Payment Penalties and Interest incurred by Payee to
various states and to the Internal Revenue Service, limited, however, to such
penalties which accrue between March 15, 1997 and the date final payment due
under the Promissory Note, as modified herein, is made by Makers to Payee.
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Continuation of Security Interests: Makers agree to insure that Payee's
security interests in the Assets are continued by having their attorneys take
any necessary steps to extend all recorded UCC-l Financing Statements which
perfected Payee's security interests in the Assets.
Additional Event of Default: In addition to the events of default
listed in the Promissory Note, the failure by Debtor to make any payment
required by the terms of this Modification and Extension Agreement will be a
default.
Default of Principal Payment - Remedy: In the event Makers default on
the principal payment due September 30, 1997, they agree to allow Payee to
immediately assume possession and ownership of the Assets transferred to Makers
by the terms of the Asset Purchase Agreement, by peaceably turning possession
thereof over to Payee on October 1, 1997 and by executing all necessary Bills of
Sale, Assignments of Franchise Agreements and the like in order to revest
ownership of the Assets in Payee's name.
Continuation of Promissory Note: All terms and conditions of the
Promissory Note, except as specifically modified herein, shall continue in full
force and effect.
PAYEE: FACTUAL DATA CORP
By: /s/ ▇.▇. ▇▇▇▇▇▇
---------------------
3
33
STATE OF COLORADO )
) ss.
COUNTY OF LARIMER )
The foregoing instrument was acknowledged before me this 14th day of
March 1997, by: /s/ ▇.▇. ▇▇▇▇▇▇ , President of FACTUAL DATA CORP.
-----------------
My commission expires:
7-31-2000 By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------- --------------------
Notary Public
MAKERS: C B Limited, Inc.,
an Oho Corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
----------------------------
▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., President
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
----------------------------
▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., Individually
STATE OF OHIO )
) ss.
COUNTY OF CUYAHOGA )
The foregoing instrument was acknowledged before me this day of
March,1997, by ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., President of C B Limited, Inc., an Ohio
Corporation, and ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., Individually.
My commission expires:
August 18, 2001 /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------- -----------------------
Notary Public
4
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MODIFICATION AND EXTENSION AGREEMENT
This Modification and Extension Agreement is made effective as of the
31st day of October 1997, between FACTUAL DATA CORP("Payee")and C B Limited,
Inc., an Ohio Corporation and ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.("Makers").
RECITALS
1. On January 5, 1996 the parties entered into an Asset Purchase
Agreement by which Makers acquired from Payee certain assets of the Factual Data
franchise operation for Indiana and by separate documents Makers also acquired
from Payee franchises for Factual Data, Outsource and EmpFacts products all of
which will be referred to collectively as the "Assets".
2. As part of the purchase price for the Assets, Makers signed a
Promissory Note dated January 16, 1996 in the principal amount of $230,000.00
payable, without interest, on March 15, 1997.
3. By Modification and Extension Agreements dated effective March 15,
1997 and September 30, 1997, respectively, the parties hereto extended the due
date and modified the terms of the Promissory Note.
4. Makers have requested an additional extension of time for paying the
balance of the principal amount and Payee is willing to further extend the due
date of the Promissory Note upon the conditions set forth below.
35
NOW THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties agree to be bound as
follows:
Payment of Principal: The remaining unpaid principal balance of
$195,000.00 shall be due and payable as follows:
$150,000.00 shall be paid on or before October 31, 1997; and $45,000
shall be paid on or before June 30, 1998.
Payment of Interest: The unpaid principal balance shall continue to
accrue interest at the rate of 18% per annum. An interest payment shall be made
together with the principal payment of $150,000.00 and monthly thereafter. All
accrued and unpaid interest shall be due and payable, together with the
remaining unpaid principal balance, on June 30, 1998.
Continuation of Security Interests: Makers agree to insure that Payee's
security interests in the Assets are continued by having their attorneys take
any necessary steps to extend all recorded UCC-1 Financing Statements which
perfected Payee's security interests in the Assets.
Additional Event of Default: In addition to the events of default
listed in the Promissory Note, the failure by Debtor to make any payment
required by the terms of this Modification and Extension Agreement will be a
default.
Default of Principal Payment - Remedy: In the event Makers default on
the principal payment due October 31, 1997, they agree to allow Payee to
immediately assume possession and ownership of the Assets transferred to Makers
by the terms of
2
36
the Asset Purchase Agreement, by peaceably turning possession thereof over to
Payee on November 1, 1997 and by executing all necessary Bills of Sale,
Assignments of Franchise Agreements and the like in order to revest ownership of
the Assets in Payee's name.
Continuation of Promissory Note: All terms and conditions of the
Promissory Note, except as specifically modified herein, shall continue in full
force and effect.
PAYEE: FACTUAL DATA CORP
By: /s/ ▇.▇. ▇▇▇▇▇▇
---------------------
STATE OF COLORADO )
)ss.
COUNTY OF LARIMER )
The foregoing instrument was acknowledged before me this 30th day of
October, 1997, by: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇ of FACTUAL DATA CORP.
My commission expires:
7-31-2000 By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------- ---------------------
Notary Public
MAKERS: C B Limited, Inc.,
an Oho Corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
-----------------------
▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., President
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
-----------------------
▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., Individually
3
37
STATE OF OHIO )
) ss.
COUNTY OF CUYAHOGA )
The foregoing instrument was acknowledged before me this 24TH day of
November,1997, by ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., President of C B Limited, Inc., an Ohio
Corporation, and ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., Individually.
My commission expires:
December 22, 1998 By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------- -----------------------
Notary Public
4