STOCK PURCHASE AGREEMENT EXHIBIT 2.1
THIS AGREEMENT is made this 12th day of May, 1997, by and between, Vista
2000, Inc., a Delaware corporation ("Seller"), and ▇.▇. ▇▇▇▇ & Co., Inc., a
Georgia corporation, or its assigns ("Purchaser").
RECITALS
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Alabaster Industries, Inc., a Delaware corporation ("Alabaster"), is
engaged in the business of manufacturing and marketing injection moulded
plastic products (the "Business").
All of the capital stock of Alabaster is owned by Seller.
Purchaser desires to purchase, and Seller desires to sell, all of the
capital stock of Alabaster, on the terms provided forth herein.
NOW, THEREFORE, IT IS HEREBY AGREED as follows:
ARTICLE I
SALE AND PURCHASE OF SHARES
1.1 SALE AND PURCHASE OF SHARES. Subject to the terms and conditions of
this Agreement, at the Closing (as defined below), Seller shall sell and
transfer to Purchaser, and Purchaser shall purchase and acquire from Seller, all
of Seller's right, title and interest in and to all of the outstanding shares of
capital stock of Alabaster (the "Shares").
1.2 EXCLUDED ASSETS AND LIABILITIES. Notwithstanding the foregoing, the
following assets, liabilities, rights and properties shall be specifically
excluded from the transactions contemplated by this Agreement (the "Excluded
Assets and Liabilities"): all intercompany accounts shown on the most recent
Financial Statements.
1.3 NO WARRANTIES. Other than as explicitly provided herein, Seller
does not, in this Agreement or any other agreement, instrument or document
contemplated by this Agreement, make any representation as to, warranty of or
covenant (whether express of implied) with respect to the Shares or the
Business.
ARTICLE II
PURCHASE PRICE
2.1 PURCHASE PRICE.
(a) The fixed purchase price for the Shares shall be Two Million
($2,000,000.00) Dollars (the "Purchase Price").
(b) At the Closing, Purchaser shall pay Five Hundred Thousand
($500,000.00) to Seller by wire transfer of immediately available funds to an
account designated by Seller. The balance of the purchase price shall be paid
by a Purchase Money Promissory Note (the "Note") in the principal amount of
$1,500,000 bearing interest at ten (10%) percent per annum which shall be
payable on the first day of each month after Closing until the first
anniversary date of the Note. Thereafter, principal together with accrued
interest shall be payable in 240 equal monthly payments with the entire
remaining principal balance due on the second anniversary date of the Note.
The Note shall be secured by a first priority mortgage (the "Mortgage") on
all of the real property owned by Alabaster together with all improvements
thereon and an Assignment of all leases on the subject property.
(c) Within one day of the execution of this Agreement, Purchaser
will deposit with ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, PC, as escrow agent, the sum of
Twenty-Five Thousand ($25,000.00) Dollars, which sum shall be paid to Seller
at the Closing and credited against the amounts owing pursuant to Section
2.1(b) hereof. If Purchaser requests to extend the Closing Date as provided
herein, Purchaser shall deposit an additional Twenty-Five Thousand
($25,000.00) Dollars with Escrow Agent to be credited or applied with the
initial $25,000 deposit. If the Closing does not occur for whatever reason
(other than by reason of a breach by Seller of the terms hereof) except as
provided in Paragraph 7.1(a) below, such amount shall be paid to Seller as
compensation for the costs and expenses, lost opportunity suffered by Seller
and total liquidated damages.
ARTICLE III
CLOSING
3.1 DATE OF CLOSING. Subject to the satisfaction of each of the
conditions set forth in Article VII, the closing of the sale and purchase of
the Shares hereunder (the "Closing") shall take place at the law offices of
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇ (or at such other place as the parties may agree in
writing) at 10:00 a.m., local time, on or before June 6, 1997 (the "Closing
Date").
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE SELLER
Seller represents and warrants to Purchaser as follows:
4.1 ORGANIZATION AND GOOD STANDING. Each of Seller and Alabaster is a
corporation duly organized, validly existing and in good standing under the
laws of the States of Delaware, and has all requisite corporate power and
authority to own, lease and operate its assets and to carry on its business
as now conducted.
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4.2 AUTHORIZATION OF AGREEMENT. Seller has all requisite power,
authority and legal capacity to execute and deliver this Agreement and each
other agreement, document, or instrument or certificate contemplated by this
Agreement (collectively, the "Seller Documents"), and to consummate the
transactions contemplated hereby and thereby. This Agreement has been, and
each of the Seller Documents will be at or prior to the Closing, duly and
validly executed and delivered by Seller and this Agreement constitutes, and
each of the Seller Documents when so executed and delivered will constitute,
the legal, valid and binding obligations of Seller enforceable against Seller
in accordance with their respective terms.
4.3 CONFLICTS; CONSENTS OF THIRD PARTIES.
(a) None of the execution and delivery by Seller of this Agreement and
the Seller Documents, the consummation by Seller of the transactions
contemplated hereby and thereby, or compliance by Seller with any of the
provisions hereof or thereof will (i) conflict with, or result in the breach
of, any provision of the certificate of incorporation or by-laws of Seller;
(ii) violate any statute, rule, regulation, judgment or order of any
governmental body by which Seller is bound; (iii) result in a breach of any
contract or agreement to which Seller or Alabaster is a party; (iv) conflict
with, or result in the breach of, any provision of the certificate of
incorporation or by-laws of Purchaser; (v) conflict with, violate, result in
the breach or termination of, constitute a default under, or give rise to any
right of acceleration under, any note, bond, mortgage, indenture, license,
agreement or other instrument or obligation to which Purchaser is a party or
by which Purchaser or its properties or assets is bound; or (vi) violate any
statute, rule, regulation, judgment or order of any governmental body by
which Purchaser is bound, except as set forth in Schedule 4.3(a).
(b) Except as set forth in Schedule 4.3, no consent, waiver, approval,
order, permit or authorization of, or declaration or filing with, or
notification to, any person or governmental body is required on the part of
Seller in connection with the execution and delivery of this Agreement or the
Seller Documents, or the compliance by Seller with any of the provisions
hereof or thereof.
4.4 OWNERSHIP AND TRANSFER OF SHARES. Seller is the owner of all the
Shares, free and clear of any and all liens, other than Permitted Exceptions
(as defined below). Seller has the power and authority to sell, transfer,
assign and deliver all the Shares as provided in this Agreement. Upon the
consummation of the Closing, Seller will have conveyed to Purchaser good
title to all of the Shares, free and clear of all liens other than the
Permitted Exceptions. For purposes hereof, "Permitted Exceptions" means
statutory liens for current taxes, assessments or other governmental charges
not yet delinquent or the amount or validity of which is being contested in
good faith by appropriate proceedings, provided an appropriate reserve is
established therefor.
4.5 LITIGATION. Except as set forth in Schedule 4.5, to the knowledge of
Seller there is no suit, action, proceeding, investigation, claim or order
pending or overtly threatened against Alabaster.
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4.6 FINANCIAL STATEMENTS. Seller will deliver to Purchaser copies of
the audited balance sheet of Alabaster as of December 31, 1996 and December
31, 1995, and the related audited statements of income, changes in
stockholders' equity and cash flows for the 1996 and 1995 fiscal years
inclusive, accompanied by the audit report of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, independent
public accountants, with respect to Alabaster (collectively, the statements
referred to above being referred to as the "Company Financial Statements").
The balance sheet referred to in the previous sentence (including the related
notes) fairly presents the financial position of Alabaster as of the date
thereof, and the other financial statements referred to in this Section 4.6
fairly present the results of Alabaster's operations and its cash flows for
the fiscal period therein set forth; each of such statements (including the
related notes, where applicable) has been prepared in accordance with GAAP
consistently applied during the periods involved. Seller will also provide
unaudited interim statements for January, February and March of 1997.
4.7 EMPLOYEES AND EMPLOYEE BENEFITS.
(a) Schedule 4.7 hereto sets forth all material, written "employee
benefit plans", as defined in Section 3(3) of Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), maintained by Alabaster or any
subsidiary of Alabaster (each, a "Subsidiary") or to which Alabaster or any
Subsidiary contributed or is obligated to contribute thereunder for current
or former employees of Alabaster or any Subsidiary (the "Employee Benefit
Plans"). Schedule 4.7 hereto lists each individual employment, termination or
severance contract or arrangement and all written compensation policies and
practices maintained by Seller and the Subsidiaries covering any current or
former employee of Alabaster and the Subsidiaries that is not an Employee
Benefit Plan (a "Benefit Arrangement"). Schedule 4.7 sets forth each Employee
Benefit Plan which is a multi-employer plan, as defined in Section 3(37) of
ERISA ("Multi-employer Plan").
(b) True, correct and complete copies of the following documents,
with respect to each of the Employee Benefit Plans (other than the
Multi-employer Plans), have been made available or delivered to Purchaser by
Alabaster: (i) any plans and related trust documents, and amendments thereto;
(ii) the most recent Forms 5500; (iii) the last Internal Revenue Service
determination letter, if applicable; (iv) summary plan descriptions; and (v)
the last actuarial valuation if the plan is a "defined benefit plan," as
defined in Section 3(35) of ERISA.
(c) The Employee Benefit Plans have been maintained in accordance
with their terms and with all provisions of the Internal Revenue Code, as
amended (the "Code") and ERISA (including rules and regulations thereunder)
and other applicable federal and state laws and regulations, except where the
failure to so maintain them would not be reasonably likely to result in a
material adverse effect on the Business (a "Material Adverse Effect").
4.8 LABOR.
(a) Except as set forth on Schedule 4.8, neither Alabaster nor any
Subsidiary is party to any labor or collective bargaining agreement and there
are no labor or collective bargaining
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agreements which pertain to current employees of the Seller or the
Subsidiaries (the "Employees").
(b) Except as set forth on Schedule 4.8, there are no (i) strikes,
work stoppages or lockouts or (ii) material grievances or other material
labor disputes pending or, as of the date of this Agreement and, to the
knowledge of Seller, threatened against or involving Alabaster or any
Subsidiary which, individually or in the aggregate, could result in a
Material Adverse Change.
4.9 CAPITALIZATION. The authorized capital stock of Alabaster consists
of Common Stock, of which _______ shares are issued and outstanding and, as
of the date hereof, are owned of record and beneficially by Seller. All of
the outstanding shares of Common Stock (x) are validly issued, fully paid and
nonassessable and (y) have not been issued in violation of any preemptive
rights. Except as described in Schedule 4.9, there are no outstanding
options, warrants, calls, rights, commitments or agreements of any kind to
which Alabaster is party or by which it is bound obligating it to issue,
deliver or sell, or cause to be issued, delivered or sold, additional capital
shares of any class or series of, or other equity interests in, Alabaster or
any securities convertible or exchangeable into or evidencing the right to
purchase any capital shares of any class or series of, or other equity
interests in, Alabaster, or obligating Alabaster to grant, extend or enter
into any such option, warrant, call, right, commitment or agreement. There
are no outstanding contractual obligations of Alabaster to repurchase, redeem
or otherwise acquire any capital shares of Alabaster.
4.10 TAXES.
(a) Alabaster has (i) properly prepared and timely filed (or there
has been filed on its behalf) with the appropriate governmental authorities
all material Tax Returns due on or prior to the date hereof for all periods
ending through the date hereof and all such Tax Returns were true and correct
in all material respects, and (ii) duly paid in full or made provision in
accordance with GAAP (or there has been paid or provision has been made on
its behalf) for the payment of all material Taxes for all periods ending
through the date hereof.
(b) There are no liens or other encumbrances upon the assets of
Alabaster for or arising from Taxes except for statutory liens for Taxes not
yet due.
(c) For the purposes of this Section 4.10, the following terms
shall have the following meanings:
(i) "TAXES" shall mean all federal, territorial, state,
municipal, local, foreign or other taxes, imposts, rates, levies, duties,
assessments and other charges including, without limitation, all income,
excise, franchise, gains, capital, real property, goods and services,
transfer, value added, gross receipts, windfall profits, severance, ad
valorem, personal property, production, sales, use, license, stamp,
documentary stamp, mortgage recording, excise, employment, payroll, social
security, unemployment, disability, estimated or withholding taxes, and any
interest, penalties or additions thereto.
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(ii) "TAX RETURN" shall mean any return, report, information
statement, schedule or other document (including any related or supporting
information) with respect to Taxes required to be provided to any
governmental authority, and any amendments thereof.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser hereby represents and warrants to Seller that:
5.1 ORGANIZATION AND GOOD STANDING. Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of Georgia.
5.2 AUTHORIZATION OF AGREEMENT. Purchaser has full corporate power and
authority to execute and deliver this Agreement and each other agreement,
document, instrument or certificate contemplated by this Agreement or to be
executed by the Purchaser in connection with the consummation of the
transactions contemplated hereby and thereby (the "Purchaser Documents"), and
to consummate the transactions contemplated hereby and thereby. The
execution, delivery and performance by Purchaser of this Agreement and each
Purchaser Document have been duly authorized by all necessary corporate
action on behalf of Purchaser. This Agreement has been, and each Purchaser
Document will be at or prior to the Closing, duly executed and delivered by
Purchaser and this Agreement constitutes, and each Purchaser Document when so
executed and delivered will constitute, legal, valid and binding obligations
of Purchaser, enforceable against Purchaser in accordance with their
respective terms.
5.3 CONFLICTS; CONSENTS OF THIRD PARTIES.
(a) None of the execution and delivery by Purchaser of this
Agreement and of the Purchaser Documents, the consummation by Purchaser of
the transactions contemplated hereby and thereby, or compliance by Purchaser
with any of the provisions hereof or thereof will (i) conflict with, or
result in the breach of, any provision of the certificate of incorporation or
by-laws of Purchaser, (ii) conflict with, violate, result in the breach or
termination of, constitute a default under, or give rise to any right of
acceleration under, any note, bond, mortgage, indenture, license, agreement
or other instrument or obligation to which Purchaser is a party or by which
Purchaser or its properties or assets is bound or (iii) violate any statute,
rule, regulation, judgment or order of any governmental body by which
Purchaser is bound, except as set forth in Schedule 4.3(a).
(b) Except as set forth on Schedule 5.3, no consent, waiver,
approval, order, permit or authorization of, or declaration or filing with,
or notification to, any person or governmental body is required on the part
of the Purchaser in connection with the execution and delivery of this
Agreement or the Purchaser Documents or the compliance by Purchaser with any
of the provisions hereof or thereof.
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5.4 LITIGATION. To the best knowledge of Purchaser, there are no legal
proceedings pending or threatened that are reasonably likely to prohibit or
restrain the ability of Purchaser to enter into this Agreement or consummate
the transactions contemplated hereby.
ARTICLE VI
COVENANTS
6.1 ACCESS TO INFORMATION. Seller agrees that, prior to the Closing
Date, Purchaser shall be entitled, through its officers, employees and
representatives (including, without limitation, its legal advisors and
accountants), to make such investigation of the business and operations of
Alabaster and such examination of the books, records and financial condition
of the Business as it reasonably requests and to make extracts and copies of
such books and records. Any such investigation and examination shall be
conducted during regular business hours and under reasonable circumstances,
and Seller shall cause Alabaster to cooperate fully therein.
6.2 CONDUCT OF THE BUSINESS PENDING THE CLOSING. Except as otherwise
expressly contemplated by this Agreement or with the prior written consent of
Purchaser, prior to the Closing, Alabaster shall conduct the Business only in
the ordinary course consistent with past practice. Neither Seller nor
Alabaster shall make or cause to be made any payments or transfers of funds
to the Seller, any officers or employees of Seller or Alabaster other than in
the ordinary course of business or draw any additional funds down under the
existing credit lines.
6.3 BEST EFFORTS. Seller and Purchaser will cooperate and use their
respective best efforts to fulfill the conditions precedent to the other
party's obligations hereunder, including but not limited to securing as
promptly as practicable all consents, approvals, waivers and authorizations
required in connection with the transactions contemplated hereby.
6.4 PUBLICITY; CONFIDENTIALITY.
(a) Neither Seller nor Purchaser shall issue any press release or
public announcement concerning this Agreement or the transactions
contemplated hereby without obtaining the prior written approval of the other
party hereto, which approval will not be unreasonably withheld or delayed,
unless disclosure is otherwise required by applicable law or stock exchange
rule; provided that, prior to making any public announcement required by law
or stock exchange rule, the party intending to make such release shall use
its best efforts to consult with the other party with respect to the text
thereof.
(b) Until the Closing Date, Purchaser shall maintain the
confidentiality of the matters set forth herein and shall not in any event
contact any suppliers, customers or other third parties with a relationship
to the Business without written permission of the Seller or its agents.
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6.5 TRANSFER TAXES. Purchaser shall be liable for and shall pay (and
shall indemnify and hold harmless Seller against) all sales, use, stamp,
documentary, filing, recording, transfer or similar fees or taxes or
governmental charges (including, without limitation, real estate and motor
vehicle registration, title recording or filing fees and other amounts
payable in respect of transfer filings) as levied by any taxing authority or
governmental agency in connection with the transactions contemplated by this
Agreement (other than taxes measured by or with respect to income imposed on
Seller or its affiliates).
ARTICLE VII
CONDITIONS TO CLOSING
7.1 CONDITIONS PRECEDENT TO OBLIGATIONS OF PURCHASER. The obligation of
Purchaser to consummate the transactions contemplated by this Agreement is
subject to the fulfillment, on or prior to the Closing Date, of each of the
following conditions (any or all of which may be waived by Purchaser in whole
or in part):
(a) Purchaser shall have received a commitment to finance certain
assets of Alabaster on terms and conditions acceptable to Purchaser in an
amount not less than Two Million ($2,000,000) Dollars. If Purchaser elects to
prepay the existing credit facility to Century Business Credit Corp.,
Purchaser shall be responsible for any prepayment fees. Should Purchaser not
receive such a commitment by the Closing Date, then at the Purchaser's
discretion, Purchaser may either cancel this Agreement and receive a refund
of $25,000 deposit as described in Paragraph 2.1(c) above, or close the
transaction described in Article VIII. After May 19, 1997, if the Seller
receives an unsolicited bona fide offer to purchase all of the Shares for a
price in excess of the purchase price described herein without a financing
contingency, Seller may either (i) require Purchaser to remove the financing
contingency of this Paragraph within 48 hours after receipt of a copy of the
unsolicited offer, or, if Purchaser fails to satisfy the financing
contingency, (ii) return the ▇▇▇▇▇▇▇ Money to Purchaser and this contract
shall be void;
(b) all representations and warranties of Seller contained herein
shall be true and correct as of the date hereof;
(c) all representations and warranties of Seller contained herein
shall be true and correct in all material respects at and as of the Closing
Date with the same effect as though those representations and warranties had
been made again at and as of that time;
(d) Seller shall have performed and complied in all material
respects with all obligations and covenants required by this Agreement to be
performed or complied with by it on or prior to the Closing Date;
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(e) Purchaser shall have been furnished with certificates (dated the
Closing Date and in form and substance reasonably satisfactory to Purchaser)
executed by an officer of Seller certifying as to the fulfillment of the
conditions specified in Sections 7.1(b), 7.1(c) and 7.1(d) hereof;
(f) there shall not be in effect any order by a governmental body of
competent jurisdiction restraining, enjoining or otherwise prohibiting the
consummation of the transactions contemplated hereby;
(g) Seller shall have complied with its obligations pursuant to
Section 8.1 hereof .
7.2 CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER. The obligations of
Seller to consummate the transactions contemplated by this Agreement are
subject to the fulfillment, prior to or on the Closing Date, of each of the
following conditions (any or all of which may be waived by Seller in whole or
in part):
(a) all representations and warranties of Purchaser contained herein
shall be true and correct as of the date hereof;
(b) all representations and warranties of Purchaser contained herein
shall be true and correct in all material respects at and as of the Closing
Date with the same effect as though those representations and warranties had
been made again at and as of that date;
(c) Purchaser shall have performed and complied in all material
respects with all obligations and covenants required by this Agreement to be
performed or complied with by Purchaser on or prior to the Closing Date;
(d) Seller shall have been furnished with a certificate (dated the
Closing Date and in form and substance reasonably satisfactory to Seller)
executed by an officer of Purchaser certifying as to the fulfillment of the
conditions specified in Sections 7.2(b), 7.2(c) and 7.2(d);
(e) there shall not be in effect any order by a governmental body of
competent jurisdiction restraining, enjoining or otherwise prohibiting the
consummation of the transactions contemplated hereby; and
(f) Purchaser shall have complied with its obligations pursuant to
Section 8.2 hereof.
7.3 NO BROKERAGE COMMISSION. The Purchaser represents and warrants that
the Purchaser has not dealt with any broker or other finder in connection
with its purchase of the stock of the Shares. The Purchaser will indemnify
and hold harmless the Seller from and against any and all claims, loss,
liability, cost and expenses (including reasonable counsel fees) resulting
from any claim that may be made against the Seller by any broker or person
claiming a commission, fee or other
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compensation by reason of this transaction, if such claim arises by or on
account of any act of the Purchaser or Purchaser's representatives.
The Seller represents and warrants that the Seller has not dealt with any
broker or other finder in connection with the sale to Purchaser of the
Shares. The Seller will indemnify and hold harmless the Purchaser from and
against any and all claims, loss, liability, cost and expenses (including
reasonable counsel fees) resulting from any claims that may be made against
the Purchaser by any broker or person claiming a commission, fee or other
compensation from purchaser by reason of this transaction, if such claim
arises by or on account of any act of the Seller or Seller's representatives.
ARTICLE VIII
DOCUMENTS TO BE DELIVERED
8.1 DOCUMENTS TO BE DELIVERED BY SELLER. At the Closing, Seller shall
deliver, or cause to be delivered, to Purchaser the following:
(a) a certificate (or certificates) representing all of the Shares
(together with duly executed stock powers);
(b) the Note and Mortgage referred to in Section 2.1(b) hereof; and
(c) the certificate referred to in Section 7.1(e) hereof.
8.2 DOCUMENTS AND OTHER ITEMS TO BE DELIVERED BY PURCHASER. At the
Closing, Purchaser shall deliver to Seller the following:
(a) payment of the Purchase Price as required by Section 2.1(b);
(b) the certificate referred to in Section 7.2(e) hereof.
ARTICLE IX
INDEMNIFICATION
9.1 SURVIVAL. The representations and warranties of Seller and
Purchaser shall survive the Closing for a period of two years after the
Closing Date. Notwithstanding anything to the contrary herein, any
representation or warranty which is the subject of a claim or dispute which
is asserted in writing prior to the expiration of the one-year period set
forth above shall survive with respect to such claim or dispute until the
final resolution and satisfaction thereof.
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9.2 INDEMNIFICATION.
(a) Subject to the provisions of Sections 9.3 and 9.4 hereof, Seller
hereby agrees to indemnify and hold harmless Purchaser and its affiliates and
their respective directors, officers, employees, agents, successors and
assigns (collectively, the "Purchaser Indemnified Parties") from and against
and in respect of any and all losses resulting from, arising out of, based on
or relating to:
(i) the failure of any representation or warranty of Seller set
forth in this Agreement, any Seller Document or any certificate or
instrument delivered by or on behalf of Seller pursuant to this Agreement
to be true and correct in all respects on the date hereof and on and as of
the Closing Date; or
(ii) the breach of any covenant or other agreement on the part of
Seller under this Agreement or any Seller Document.
(b) Purchaser hereby agrees to indemnify and hold harmless Seller,
and its affiliates, and their respective directors, officers, employees,
agents, successors and assigns (collectively, the "Seller Indemnified
Parties") from and against and in respect of any and all losses resulting
from, arising out of, based on or relating to:
(i) the failure of any representation or warranty of Purchaser
set forth in this Agreement or any Purchaser Document or any certificate and
instrument delivered by or on behalf of Purchaser pursuant to this
Agreement, to be true and correct in all respects on the date hereof and on
and as of the Closing Date; or
(ii) the breach of any covenant or other agreement on the part of
Purchaser under this Agreement or any Purchaser Document.
9.3 DETERMINATION OF DAMAGES AND RELATED MATTERS. In calculating any
amounts payable to Purchaser pursuant to Section 9.2(a) or payable to Seller
pursuant to Section 9.2(b), Seller or Purchaser, as the case may be, shall
receive credit for (i) any actual reduction in tax liability as a result of
the facts giving rise to the claim for indemnification, and (ii) any
insurance recoveries actually received by the party to be indemnified, and no
amount shall be included for Purchaser's or Seller's, as the case may be,
special or consequential damages.
9.4 LIMITATION ON INDEMNIFICATION LIABILITIES. Seller shall not be
liable under Section 9.2(a)(i) or (a)(ii) hereof (a) unless the aggregate
dollar amount of all losses, liabilities, damages or expenses (including
reasonable attorneys' fees) indemnified against under such respective
Sections exceeds $25,000, and then only to the extent such aggregate amount
exceeds $25,000 and (b) the maximum liability under such respective Sections
shall be $1,000,000.
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9.5 INDEMNIFICATION PROCEDURES. For the purposes of administering the
indemnification provisions of Section 9.2, the following procedures shall
apply:
(a) If an indemnified party shall receive notice of any action or
proceeding by a third party with respect to which the indemnified party
asserts are indemnifiable under Section 9.2 (a "Claim"), the indemnified
party shall notify the indemnifying party (the "Indemnitor") of such claim in
writing promptly following the receipt of notice of the commencement of such
claim. The failure to give notice as required by this Section 9.5 in a timely
fashion shall not result in a waiver of any right to indemnification
hereunder except to the extent that the Indemnitor is actually prejudiced
thereby.
(b) The Indemnitor shall be entitled to assume the defense or
settlement of any claim of the type referred to in Section 9.5 (a) hereof
(with counsel reasonably satisfactory to the indemnified parties). If the
Indemnitor assumes any such defense or settlement, it shall pursue such
defense or settlement in good faith. If the Indemnitor fails to elect in
writing, within 10 days after the notification referred to above, to assume
the defense of any claim as provided above, the indemnified party may engage
counsel to defend, settle or otherwise dispose of such claim, which counsel
shall be reasonably satisfactory to the Indemnitor; provided, however, that
the indemnified party shall not settle or compromise any such claim without
the consent of the Indemnitor (which consent will not be unreasonably
withheld or delayed).
(c) In cases where the Indemnitor has elected to assume the defense
or settlement with respect to a claim as provided above, the Indemnitor shall
be entitled to assume such defense or settlement PROVIDED that: (i) the
indemnified party (and its counsel) shall be entitled to continue to
participate at its own cost in any such action or proceeding or in any
negotiations or proceedings to settle or otherwise eliminate any claim for
which indemnification is being sought; (ii) the Indemnitor shall not be
entitled to settle or compromise any such claim without the consent or
agreement of the indemnified party (such consent not to be unreasonably
withheld or delayed); and (iii) after written notice by the Indemnitor to the
indemnified party of its election to assume control of the defense of any
claim, the Indemnitor shall not be liable to such indemnified party hereunder
for any attorneys' fees and disbursements subsequently incurred by such
indemnified party in connection therewith.
9.6 TREATMENT OF PAYMENT. Seller and Purchaser agree to treat any
indemnity payment made pursuant to Section 9.2 of this Agreement as an
adjustment to the Purchase Price for federal, state, local and foreign income
tax purposes.
ARTICLE X
MISCELLANEOUS
10.1 EXPENSES. Except as otherwise provided in this Agreement, Seller
and Purchaser shall each bear their own expenses incurred in connection with
the negotiation and execution of this
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Agreement and each other agreement, document and instrument contemplated by
this Agreement and the consummation of the transactions contemplated hereby
and thereby.
10.2 SPECIFIC PERFORMANCE. Seller agrees that the breach of this
Agreement would cause irreparable damage to Purchaser and that Purchaser will
not have an adequate remedy at law. Therefore, the obligations of Seller
under this Agreement, including, without limitation, Seller's obligation to
sell the Shares to Purchaser, shall be enforceable by a decree of specific
performance issued by any court of competent jurisdiction, and appropriate
injunctive relief may be applied for and granted in connection therewith.
Such remedies shall, however, be cumulative and not exclusive and shall be in
addition to any other remedies which any party may have under this Agreement
or otherwise.
10.3 FURTHER ASSURANCES. The parties hereto undertake to cooperate in
good faith to ensure that they do such acts and things as may reasonably be
necessary to complete the sale and purchase of the Assets. At all times after
the date of this Agreement the parties shall use their reasonable best
efforts to procure that any necessary third party shall execute such
documents and do such acts and things as may reasonably be required for the
purpose of giving to Seller and Purchaser, respectively, the full benefit of
all the provisions of this Agreement. Seller and Purchaser will use their
reasonable best efforts to obtain any consent, substitution, approval or
amendment required to novate or assign all agreements, leases, licenses and
other rights of any nature whatsoever relating to the assets, rights and
other things of the Business of value to Purchaser; PROVIDED, HOWEVER, that
neither Seller nor Purchaser shall be obligated to pay any consideration
therefor (except for filing fees and other similar charges) to the third
party from whom such consents, approvals, substitutions and amendments are
requested. If Seller or Purchaser is unable to obtain any such required
consent, approval, substitution or amendment, Seller shall continue to be
bound by such agreements, leases, licenses and other rights and, unless not
permitted by law or the terms thereof, Purchaser shall, as agent for Seller
or as subcontractor, pay, perform and discharge fully all the obligations of
Seller thereunder from and after the Closing and indemnify and hold harmless
Seller and its subsidiaries from and against, all losses, claims, damages,
taxes, liabilities and expenses whatsoever arising out of or in connection
with Purchaser's performance of or omission to perform its obligations
thereunder and hereunder. Seller shall, without further consideration, pay
and remit to Purchaser promptly all money, rights and other consideration
received in respect of such performance after payment of any taxes due from
Seller with respect to such receipt. Seller shall exercise their rights and
options under all such agreements, leases, licenses and other rights and
commitments referred to in this Section 10.3 only as reasonably directed by
Purchaser and at Purchaser's expense. If and when any such consent shall be
obtained or such agreement, lease, license or other rights shall otherwise
become assignable or able to be novated, Seller shall promptly assign all its
rights and obligations thereunder to Purchaser without payment of further
consideration and Purchaser shall, with the payment of any further
consideration, assume such rights and obligations. To the extent that the
assignment of any contract or agreement or the proceeds thereof pursuant to
this Section 10.3 is prohibited by law, the assignment provisions of this
paragraph shall operate to create a subcontract with the Purchaser to perform
each relevant, unassignable contract or agreement, and the subcontract
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price shall be equal to the money (after tax), rights and other consideration
received by Seller with respect to the performance by Purchaser under such
subcontract.
10.4 ENTIRE AGREEMENT; AMENDMENTS AND WAIVERS. This Agreement
(including the schedules and exhibits hereto) represents the entire
understanding and agreement between the parties hereto with respect to the
subject matter hereof and can be amended, supplemented or changed, and any
provision hereof can be waived, only by written instrument making specific
reference to this Agreement signed by the party against whom enforcement of
any such amendment, supplement, modification or waiver is sought. No action
taken pursuant to this Agreement, including without limitation, any
investigation by or on behalf of any party, shall be deemed to constitute a
waiver by the party taking such action of compliance with any representation,
warranty, covenant or agreement contained herein. The waiver by any party
hereto of a breach of any provision of this Agreement shall not operate or be
construed as a further or continuing waiver of such breach or as a waiver of
any other or subsequent breach. No failure on the part of any party to
exercise, and no delay in exercising, any right, power or remedy hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise
of such right, power or remedy by such party preclude any other or further
exercise thereof or the exercise of any other right, power or remedy. All
remedies hereunder are cumulative and are not exclusive of any other remedies
provided by law.
10.5 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Georgia without giving effect to
principles of conflicts of law.
10.6 HEADINGS. The section headings of this Agreement are for reference
purposes only and are to be given no effect in the construction or
interpretation of this Agreement.
10.7 NOTICES. All notices and other communications under this Agreement
shall be in writing and shall be deemed given when delivered personally or
mailed by certified mail, return receipt requested, to the parties (and shall
also be transmitted by facsimile to the persons receiving copies thereof) at
the following addresses (or to such other address as a party may have
specified by notice given to the other party pursuant to this provision):
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If to Purchaser:
▇.▇. ▇▇▇▇ & Co., Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇.▇. ▇▇▇▇
If to Seller:
Vista 2000, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇-▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Any party may by notice change the address to which notice or other
communications to it are to be delivered or mailed.
10.8 SEVERABILITY. If any provision of this Agreement is invalid or
unenforceable, the balance of this Agreement shall remain in effect.
10.9 BINDING EFFECT; ASSIGNMENT. This Agreement shall be binding upon
and inure to the benefit of the parties and their respective successors and
permitted assigns. Nothing in this Agreement shall create or be deemed to
create any third party beneficiary rights in any person or entity not a party
to this Agreement except as provided below. No assignment of this Agreement
or of any rights or obligations hereunder may be made by any party hereto
without the prior written consent of the other parties hereto and any
attempted assignment without the required consents shall be void.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the
date first written above.
VISTA 2000, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Secretary
▇.▇. ▇▇▇▇ & CO., INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇, President
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