EXHIBIT 10.7
ASSET PURCHASE AGREEMENT
DATED FEBRUARY 24, 1997
BY AND AMONG
OUTSOURCE INTERNATIONAL, INC.
AS BUYER
AND
STANDBY PERSONNEL OF COLORADO SPRINGS, INC.
AND
▇▇▇▇▇▇ ▇▇▇▇▇▇
AS SELLER
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT is made and entered into as of the 24th day
of February, 1997 ("Agreement"), by and among OutSource International, Inc., an
Illinois corporation ("Buyer"), and Standby Personnel of Colorado Springs, Inc.,
a Colorado Corporation, doing business as Stand-by Personnel ("SBP"), and ▇▇▇▇▇▇
▇▇▇▇▇▇ ("▇▇▇▇▇▇") (sometimes collectively referred to as "Seller").
RECITALS:
WHEREAS, the Seller operates a temporary help business from four (4)
locations in and around Colorado Springs, Colorado (the "Business").
WHEREAS, Seller desires to sell to Buyer, and Buyer desires to purchase
from Seller, on the terms and conditions set forth herein, substantially all of
the assets of the Seller, which together constitute substantially all of the
assets that are used in connection with, necessary for, or beneficial to, the
operation of the Business;
NOW, THEREFORE, in consideration of the representations, warranties,
covenants and agreements contained herein, the parties hereto, intending to be
legally bound hereby, agree as follows:
1. SALE OF ASSETS; ASSUMPTION OF LIABILITIES.
1.1 SALE OF ASSETS OF SELLER. Subject to the terms and conditions hereof,
Seller will sell, convey, assign, transfer and deliver to Buyer at the Closing
(as hereafter defined), and Buyer will purchase and accept at the Closing, all
assets, properties, privileges, rights, interests, business and goodwill owned
by Seller or in which Seller has an interest (except the Excluded Assets, as
hereinafter defined), and used or held for use in connection with the operation
of the Business, of every kind and description, real, personal and mixed,
tangible and intangible and wherever located (such assets, properties,
privileges, rights, interests, business and goodwill being transferred hereunder
are hereinafter referred to collectively as the "Assets"). Without limiting the
generality of the foregoing, the Assets shall include all of Seller's right,
title and interest in and to the following (except to the extent any of the
following constitute Excluded Assets):
(a) All supplies, equipment, vehicles, machinery, furniture, fixtures,
leasehold improvements and other tangible property owned by Seller or used by
Seller in connection with the Business, including the tangible assets listed on
SCHEDULE 1.1.
(b) All of Seller' right, title and interest under all agreements or
contracts to which it is a party or by which it or the Assets are bound or which
otherwise relate to the Business, including, without limitation, the documents
listed in EXHIBIT A or SCHEDULE 1.4 hereto;
(c) All of Seller' right, title and interest in and to the Intellectual
Property (as hereafter defined) owned by Seller or used in the Business;
(d) All proprietary knowledge, trade secrets, technical information,
quality control data, processes (whether secret or not), methods, and other
similar know-how or rights used in the Business;
(e) The Business as a going concern and its customer lists, vendor
lists, restrictive covenants, choses in action, rights of recovery, rights of
recoupment, lists of temporary employees, together with all books, computer
software, files, papers, records and other data of Seller relating to their
respective assets, properties, business and operations;
(f) All rights of Seller in and to its trade names and trademarks used
in the Business, and variants thereof and all goodwill associated therewith for
a period of twelve (12) months from the date of Closing at no additional cost of
any kind; and
(g) All other property and rights of every kind or nature owned by
Seller or used in the Business, including but not limited to the employment
applications of temporary and permanent staff (the "Applications").
1.2 ASSETS RETAINED BY SELLER. There shall be excluded from the Assets and
retained by Seller all of the following (collectively, the "Excluded Assets"):
(a) the corporate charters, qualifications to conduct business as a
foreign corporation, arrangements with registered agents relating to foreign
qualifications, taxpayer and other identification numbers, seals, minute books,
stock transfer books, blank stock certificates, and other documents relating to
the organization, maintenance, and existence of Seller as a corporation;
(b) any of the rights of Seller under this Agreement (or under any
agreement between Seller on the one hand and Buyer on the other hand entered
into on or after the date of this Agreement); and
(c) all cash and accounts receivable of the Business and all personal
assets of ▇▇▇▇▇▇.
1.3 ASSUMPTION OF LIABILITIES. At the Closing, Buyer shall assume, and
shall agree to satisfy and discharge as the same become due only those
liabilities and obligations of Seller specifically listed on EXHIBIT A hereto
(the "Assumed Obligations") and, subject to Section 1.4 of this Agreement, the
Assumed Leases (as hereafter defined). Buyer shall not assume or be responsible
at any time for any liability, obligation, debt or commitment of Seller, whether
absolute or contingent, accrued or unaccrued, asserted or unasserted, or
otherwise, that is not expressly listed on EXHIBIT A hereto. Without limiting
the generality of the foregoing sentence,
-2-
Buyer shall not assume or be responsible for any of the following: any amounts
due to any of Seller' creditors listed on EXHIBIT A hereto in excess of the
amounts expressly listed thereon; any matured obligations under leases,
licenses, contracts or agreements in excess of the amounts expressly listed on
EXHIBIT A hereto; any liabilities, obligations, debts or commitments of Seller
incident to, arising out of, or incurred with respect to, this Agreement and the
transactions contemplated hereby; any and all sales, use, franchise, income,
gross receipts, excise, payroll, personal property (tangible or intangible),
real property, ad-valorem, value added, leasing, leasing use, or other taxes,
levies, imposts, duties, charges or withholdings of any nature arising out of
the transactions contemplated hereby.
Seller further agrees to satisfy and discharge as the same shall become due
all of its obligations and liabilities not specifically assumed by Buyer
hereunder. Buyer's assumption of the Assumed Obligations shall in no way expand
the rights and remedies of third parties against Buyer as compared to the rights
and remedies which such parties would have had against Seller had this Agreement
not been consummated.
1.4 LEASES. Notwithstanding any other provision of this Agreement, Buyer's
assumption of any liabilities or obligations of any Seller with respect to any
lease or leasehold interest (the "Assumed Leases") shall be subject to the terms
of the Lease Assignment and Assumption Agreements to be delivered pursuant to
Sections 2.2(g) and 2.3(b) of the Agreement.
1.5 PAYMENT FOR ASSETS. Buyer shall purchase the Assets for an aggregate
purchase price (the "Purchase Price") of Three Million One Hundred Thousand
Dollars ($3,100,000.00) calculated in the manner set forth on EXHIBIT F hereto.
1.6 ALLOCATION OF PURCHASE PRICE. The Purchase Price shall be allocated
among the Assets as set forth on EXHIBIT B hereto (the "Allocation"). The
Allocation shall be made in accordance with Section 1060 of the Internal Revenue
Code and applicable Treasury regulations. The Buyer and Seller shall (i) be
bound by the Allocation for purposes of determining any Taxes (as hereafter
defined), (ii) prepare and file tax returns on a basis consistent with the
Allocation and (iii) take no position inconsistent with the Allocation in any
proceeding before any taxing authority or otherwise. In the event that the
Allocation is disputed by any taxing authority, the party receiving notice of
the dispute shall promptly notify the other parties hereto of the receipt of
such notice.
1.7 PAYMENT OF PURCHASE PRICE. Buyer shall pay the Purchase Price as
follows:
(a) Buyer shall pay Two Million Two Hundred and Fifty Thousand Dollars
($2,250,000.00) to SBP by cashier's check or bank wire (the "Cash Payment") on
the Closing Date; and
(b) At Closing, deliver to SBP a subordinated note substantially in the
form attached as EXHIBIT C hereto.
-3-
(i) The note shall be for Eight Hundred and Fifty Thousand Dollars
($850,000.00), it shall bear interest at Four percent (4%) per
annum fixed. It shall be due in two installments of principal
and interest on March 16, 1998 and March 16, 1999. The note is
subject to the performance parameters outlined in 1.7(b) (ii)
below.
(ii) The amount of each principal installment of the note referred
to in 1.7(b)(i) above will be:
(v) increased by fifteen-cents ($.15) for each dollar that
OutSource's gross margin is greater than $1,950,000.00 in
1997 and $1,950,000.00 in 1998;
(w) decreased by fifteen-cents ($.15) for each dollar that
OutSource's gross margin is less than $1,950,000.00 in 1997
and $1,950,000.00 in 1998;
(x) the maximum amount of any such increase or decrease will
not be more than $250,000.00 in any given year;
(y) gross margin shall be defined as net revenues (gross
revenues less credit memos) less temporary help payroll,
all employer paid payroll taxes, workers' compensation,
unrecovered advances, bad debts, transportation costs (van,
gas, etc.) and safety equipment.
(z) the gross margin targets for 1997 and 1998 shall include
all of OutSource's Colorado Springs operations (those
acquired in this transaction plus those opened subsequent
to this transaction). However any acquisitions OutSource
might make after the close of this transaction will not be
included.
1.8 ENCUMBRANCES. The Assets shall be sold and conveyed to Buyer free and
clear of all mortgages, security interests, charges, encumbrances, liens,
assessments, covenants, claims, title defects, pledges, encroachments and
burdens of every kind or nature whatsoever, except for the matters set forth in
SCHEDULE 3.1 hereto (the "Permitted Liens").
1.9 PRORATION. All ad valorem and property taxes, and any similar
assessment based upon or measured by Seller's ownership interest in the Assets,
shall be prorated between Seller and Buyer as of the Closing Date based upon
such taxes assessed against the Assets for the tax period in question, or if
there is insufficient information for such tax period, based upon taxes assessed
for the immediately preceding tax period. All such taxes shall be prorated on
the basis of a 365-day year. Seller shall be charged for all such taxes and
assessments based upon or measured by
-4-
Seller's ownership prior to the Closing Date and Buyer shall be charged for all
such taxes and assessments based upon or measured by Buyer's ownership on or
after the Closing Date. All such prorations and payments shall be made at the
Closing.
2. CLOSING DATE.
2.1 TIME AND PLACE OF CLOSING. The closing of the sale and purchase of the
Assets (the "Closing") will take place at the offices of Flynn, McKenna, ▇▇▇▇▇▇
& ▇▇▇▇▇ in Colorado Springs at 10:00 a.m., Mountain Time, on February 24, 1997
or at such other time and place as the parties may establish (the date of the
Closing being hereinafter referred to as the "Closing Date"). The transactions
contemplated hereby shall be deemed to be effective as of 12:01 a.m., Mountain
Standard Time, on the Closing Date. If any extension of time is needed to close
it shall only be by mutual agreement of both parties.
2.2 DELIVERIES BY SELLER. At or prior to the Closing, Seller shall execute
and deliver or cause to be executed and delivered to Buyer the following:
(a) A ▇▇▇▇ of Sale, in substantially the form attached as EXHIBIT D
hereto;
(b) An Assignment and Assumption Agreement, in substantially the form
attached as EXHIBIT E hereto;
(c) Noncompetition Agreements in substantially the form attached as
EXHIBIT G hereto executed by ▇▇▇▇▇▇ and all branch office employees of SBP (to
the extent that such branch office employees agree to sign such agreement)
pursuant to which they shall agree not to compete in the greater Colorado
Springs area for a period of fifteen (15) years in the case of ▇▇▇▇▇▇ (if some
of the purchase price is allocated to a non-compete; if it is not then the
non-compete will be for five (5) years) and one (1) year for all branch office
employees.
(d) An Assignment of Applications, in substantially the form attached
as EXHIBIT I hereto;
(e) A Certificate executed as of the Closing Date by a duly authorized
officer of SBP certifying: (i) the resolutions of the Board of Directors and
Shareholders of SBP approving the transactions contemplated hereby, and (ii) as
to the accuracy of SBP's representations and warranties and as to the
performance and compliance of all of the terms, provisions and conditions to be
performed or complied with by SBP at or before Closing;
(f) The documents required pursuant to Sections 7.2, 7.4, 7.9, 7.10,
7.13 and 7.14 of this Agreement;
(g) An Assignment and Assumption of lease(s) substantially in the form
attached as EXHIBIT H hereto; and
-5-
(h) A certification that OutSource has the right to use the "Stand-by
Personnel" name, at no charge, for a period of twelve (12) months from the date
of closing.
(i) Such other instruments of sale, transfer, conveyance and assignment
as Buyer and its counsel may reasonably request.
2.3 DELIVERIES BY BUYER. At or prior to Closing, Buyer shall execute and
deliver or cause to be executed and delivered to Seller the following:
(a) The Promissory Note.
(b) An Assignment and Assumption Agreement, in substantially the form
attached as EXHIBIT E hereto;
(c) A Certificate executed as of the Closing Date by a duly authorized
officer of Buyer certifying: (i) the resolutions of the Board of Directors of
Buyer approving the transactions contemplated hereby, and (ii) as to the
accuracy of Buyer's representations and warranties and as to the performance and
compliance of all of the terms, provisions and conditions to be performed or
complied with by Buyer at or before Closing; and
(d) OutSource's standard employment agreement stating that ▇▇▇▇▇▇ shall
be employed by OutSource, as an employee at will, beginning on the date of
closing, at an annual salary of $90,000 per year plus a bonus potential of up to
30% of salary, plus benefits commensurate with other OutSource employees in his
comparable position.
(e) Such other instruments of assumption as Seller and their counsel
may reasonably request.
3. REPRESENTATIONS AND WARRANTIES OF SELLER. Seller, jointly and severally, as a
material inducement to Buyer to enter into this Agreement and consummate the
transactions contemplated hereby, makes the following representations and
warranties to Buyer. Exceptions to such representations and warranties are set
forth in the disclosure schedule accompanying this Agreement (the "Disclosure
Schedule"). The Disclosure Schedule shall be effective to modify only those
representations and warranties to which the Disclosure Schedule makes explicit
reference. The phrase "to any Seller's knowledge" or similar language used in
this Section 3 shall, in each case, mean the best knowledge of any Seller, after
reasonable investigation.
3.1 TITLE TO ASSETS. Except as described in SCHEDULE 3.1 hereto, Seller has
good, marketable and unencumbered title to the Assets (or, with respect to any
real or personal property leases included in the Assets, a valid leasehold
interest therein), free and clear of all mortgages, security interests, liens,
claims, encumbrances, title defects, pledges, charges, assessments, covenants,
encroachments and burdens of any kind or nature whatsoever, and have full right
and authority to transfer and deliver all the Assets. Except as described in
SCHEDULE 3.1 hereto, upon
-6-
consummation of the transactions contemplated hereby, Seller will have
transferred to Buyer good, marketable and unencumbered title to the Assets (or
with respect to any real or personal property leases included in the Assets, a
valid leasehold interest therein), free and clear of all mortgages, security
interests, liens, claims, encumbrances, title defects, pledges, charges,
assessments, covenants, encroachments and burdens of any kind or nature
whatsoever. The Assets constitute all of the assets that are used in connection
with, necessary for, or beneficial to the operation of the Business.
3.2 CORPORATE STATUS OF SBP. Standby Personnel of Colorado Springs, Inc. is
a corporation duly organized, validly existing and in good standing under the
laws of the State of Colorado. It is qualified to do business and is in good
standing in each jurisdiction where the operation of its business requires that
it be so qualified. It has all requisite corporate power and authority to own,
operate and lease its properties and assets, to conduct its business as it is
now being conducted, to execute, deliver and perform its obligations under this
Agreement and to consummate the transactions contemplated hereby. An accurate
and complete copy of the Articles of Incorporation and Bylaws, as presently in
effect, are included as an attachment to SCHEDULE 3.2 hereto.
3.3 AUTHORITY CONCERNING THIS AGREEMENT. The execution, delivery and
performance by Seller of this Agreement and of each agreement, document or
instrument executed and delivered or to be executed and delivered in connection
with the transactions contemplated hereby, and the consummation of the
transactions contemplated hereby and thereby, have been duly and validly
authorized and approved by all necessary corporate action of Seller. This
Agreement is (and, when executed and delivered, each agreement, document or
instrument to be executed and delivered in connection with the transactions
contemplated hereby will be) valid and binding upon Seller, and enforceable
against Seller in accordance with their respective terms except to the extent
that enforcement thereof may be limited by applicable bankruptcy,
reorganization, insolvency or moratorium laws, or other laws affecting the
enforcement of creditors' rights or by the principles governing the availability
of equitable remedies.
3.4 CONDITION OF REAL AND PERSONAL PROPERTY; LEASES. All real property
leased by Seller and used in the operation of the Business is listed and
described in SCHEDULE 1.4 hereto. To the best of Seller knowledge, all buildings
and improvements located thereon are in good condition and repair, subject only
to normal wear and tear. All material items of tangible personal property and
assets owned or leased by Seller and used in the operation of the Business are
described in SCHEDULE 1.1 hereto. All machinery and equipment listed in SCHEDULE
1.1 conforms to all applicable ordinances, regulations, and zoning or other
laws. Except as described in SCHEDULE 3.4, all items listed on SCHEDULE 1.1 are
in good operating condition and repair, subject only to normal wear and tear,
and are adequate to conduct the Business as it is now being conducted. Seller
has delivered to Buyer accurate and complete copies of all leases relating to
real and personal property leased by Seller and used in the operation of the
Business and, except as described in SCHEDULE 1.4, all such leases are in full
force and effect, no event of default has been declared thereunder and, to the
Seller's knowledge, no basis for any default exists.
-7-
3.5 FINANCIAL STATEMENTS; UNDISCLOSED LIABILITIES. Attached hereto as part
of SCHEDULE 3.5 are the Seller's profit & loss statement and balance sheet
(Financial Statements) up through the period ending November 30, 1996. The
Financial Statements (y) present fairly the financial position and results of
operations of the Seller for the dates or periods indicated thereon, (z)
accurately reflect the transactions, assets and liabilities of Seller as of the
dates and for the periods presented. Except as set forth in the Financial
Statements or on SCHEDULE 3.5 hereto, Seller has no debts, liabilities or
obligations, whether direct or indirect, accrued, absolute, contingent, matured,
known, unknown or otherwise, and whether or not of a nature required to be
reflected or reserved against in a balance sheet in accordance with generally
accepted accounting principles. Seller is not aware of any basis for the
assertion of any claims or liabilities of any nature which are not fully
reflected or reserved against in the Financial Statements or otherwise disclosed
in SCHEDULE 3.5 hereto.
3.6 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since October 23, 1996, Seller
has conducted its business only in the normal and ordinary course in
substantially the same manner as heretofore conducted and have used all
reasonable efforts consistent with normal business practices to preserve and
promote such business and to avoid any act that might have a material adverse
effect upon the value of such business as a going concern or upon the Assets. No
event has occurred to prevent the Seller's business from operating in a normal
and usual manner and in substantially the same manner as heretofore operated.
Except as expressly set forth in SCHEDULE 3.6 hereto, since October 23,1996:
(a) there has not been any damage, destruction or loss, whether covered
by insurance or not, materially and adversely affecting the Seller's business or
the Assets;
(b) there has not been any (i) increase (other than normal merit or
cost-of-living increases in the ordinary course of business and consistent with
past practices) or material change: (y) in compensation or bonuses payable to or
to become payable by Seller to its officers, employees or agents, or (z) in any
insurance, pension or other benefit plan, payment or arrangement made to, for or
with any of such officers, employees or agents; or (ii) other material change in
the employment terms of any officer, employee or agent of Seller;
(c) there has not been any sale, transfer or other disposition of any
tangible or intangible asset, or real or personal property or interest therein,
or any mortgage, lien or encumbrance placed thereon except in the ordinary
course of business and consistent with past practice;
(d) there have not been any capital expenditures, capital additions,
capital improvements or charitable contributions made, or committed to be made,
involving, individually or in the aggregate, Three Hundred Dollars ($300.00) or
more, without the prior written consent of Buyer;
-8-
(e) there has not been any failure to maintain any Seller's books,
accounts and records in the usual, regular and ordinary manner and in accordance
with good business practices and consistent with past practice;
(f) there has not been any action taken or omitted to be taken by
Seller which could cause (with or without the giving of notice or the passage of
time, or both) the breach, default, acceleration, amendment, termination or
waiver of or under any Material Agreement (as hereinafter defined) or the
imposition of any lien, encumbrance, mortgage or other claim or charge against
the Assets;
(g) there has not been any liability, obligation or commitment incurred
by SBP involving, individually or in the aggregate, more than $2,500.00;
(h) Seller has not entered into, nor has any Seller or the Assets
become subject to, any contracts, agreements, commitments, indentures,
mortgages, notes, bonds, licenses, real or personal property leases or other
obligations of the type required to be disclosed in SCHEDULE 3.7 hereto that are
not otherwise disclosed herein;
(i) SBP has not made any capital investment in, any loan to, or any
acquisition of the securities or assets of any person or entity;
(j) there has been no change made or authorized in the charter or
bylaws of SBP;
(k) SBP has not issued, sold or otherwise disposed of any of its
capital stock or granted any options, warrants or other rights to purchase or
obtain any of its capital stock;
(l) Seller has not declared, set aside or paid any dividend or made any
distribution with respect to its capital stock (whether in cash or in kind) or
redeemed, purchased or otherwise acquired any of its capital stock;
(m) SBP has not made any loan to, or entered into any other transaction
with, any of its directors, officers or employees;
(n) there has not been any other event or condition of any character
which, individually or in the aggregate, has had or could reasonably be expected
to have a material adverse effect on the Assets or on the business, financial
condition or operations of Seller; and
(o) there has not been any commitment to do any of the foregoing.
3.7 CONTRACTS AND COMMITMENTS. EXHIBIT A and SCHEDULE 3.7 hereto together
include a true, correct and complete list of all material contracts, agreements,
commitments, indentures, mortgages, notes, bonds, licenses, real and personal
property leases and other obligations to which Seller is a party, by which
Seller or its assets or properties are bound or may be affected or which
-9-
otherwise relate to the Business (the "Material Agreements"). Without limiting
the generality of the foregoing, the term Material Agreement includes: (a) any
lease or license with respect to any Assets, whether a Seller is tenant,
landlord, licensor or licensee thereunder; (b) any agreement, contract,
indenture or other instrument relating to the borrowing of money or the
guarantee of any obligation or the deferred payment of the purchase price of any
Assets; (c) any agreement concerning a partnership or joint venture; (d) any
agreements between SBP on the one hand and any of its shareholders, officers,
directors or employees on the other; (e) any agreement relating to
confidentiality or noncompetition; (f) any preferential purchase right, right of
first refusal or similar agreement; (g) any agreement entered into outside of
the ordinary course of business; or (h) any other agreement (or group of related
agreements) which could involve expenditures (in cash or in kind) by SBP in
excess of $2,500.00 per year. True and complete copies of all of the Material
Agreements are included as part of SCHEDULE 3.7 hereto. Each of the Material
Agreements listed in EXHIBIT A and SCHEDULE 3.7 are valid, binding and
enforceable in accordance with their respective terms and are in full force and
effect and were entered into in the ordinary course of business on an "arms
length" basis. No part of Seller's rights or benefits under any Material
Agreement has been assigned, transferred, or in any way encumbered. Seller is
not in breach of nor has Seller defaulted under any of the Material Agreements
and no occurrence or circumstance exists which constitutes (with or without the
giving of notice or the passage of time or both) a breach or default by Seller
under any Material Agreement. To Seller's knowledge, the other parties to the
Material Agreements are not in default thereunder and no occurrence or
circumstance exists which constitutes or would constitute (with or without the
giving of notice or the passage of time or both) a breach or default by the
other party thereunder. Except as set forth on SCHEDULE 3.7 hereto, neither
Seller nor any of the Assets are bound by or subject to any contract, agreement,
commitment, indenture, mortgage, note, bond, license, real or personal property
lease or other obligation which on the Closing Date cannot be terminated upon
thirty (30) days' written notice by Seller or Buyer without penalty or other
obligation being incurred upon such termination.
3.8 INTELLECTUAL PROPERTY. To the best of Seller's knowledge, Seller owns
or is licensed to use all patents, trademarks, copyrights, trade names, service
marks and other trade designations, including common law rights, registrations,
applications for registration, technology, know-how or processes necessary to
conduct the Business ("Intellectual Property"), free and clear of and without
conflict with the rights of others. Each item of Intellectual Property owned or
used by Seller immediately prior to the Closing shall be owned or available for
use by Buyer on identical terms and conditions immediately subsequent to the
Closing. Seller has taken all necessary and desirable action to maintain and
protect each item of Intellectual Property that Seller owns or uses and to
consummate the transfer and assignment thereof to Buyer. To the knowledge of
Seller, Seller has not interfered with, infringed upon, misappropriated or
otherwise come into conflict with any Intellectual Property rights of third
parties, and Seller has not received any charge, complaint, claim, demand or
notice alleging any such interference, infringement, misappropriation or
violation. To the knowledge of Seller, no third party has interfered with,
infringed upon, misappropriated or otherwise come into conflict with any
Intellectual Property rights of Seller. SCHEDULE 3.8 hereto contains a true and
correct description of the following:
-10-
(a) All Intellectual Property currently owned, in whole or in part, by
Seller, and all licenses, royalties, assignments and other similar agreements
relating to the foregoing to which Seller is a party; and
(b) All agreements relating to Intellectual Property that Seller is
licensed or authorized to use from others or which Seller licenses or authorizes
others to use.
3.9 TAXES. All federal, state, local and foreign tax returns (including
information returns) and reports of Seller required by any applicable law, rule,
regulation or procedure of any federal, state, local or foreign agency,
authority or body to be filed have been duly filed by such Seller. Seller has
either (i) paid all federal, state, county, local, foreign and other taxes
(hereinafter "Taxes" or individually a "Tax") required to be paid by them
through the Closing Date and all deficiencies or other additions to Tax,
including interest or penalties owed in connection with any such Taxes or (ii)
included adequate provision for all such Taxes and deficiencies or other
additions to Tax applicable to Seller in the Seller's Financial Statements. All
Taxes and other assessments and levies required to be collected or withheld by
Seller with respect to the operation of their business from customers with
respect to sales of products or from employees for income taxes, social security
taxes and unemployment insurance taxes have been collected or withheld, and
either paid to the respective governmental agencies, or set aside in an account
owned by Seller and established for that purpose.
Seller is not a party to any pending action or proceeding regarding
assessment or collection of Taxes by any governmental authority. To Seller's
knowledge, no action or proceeding regarding assessment or collection of Taxes
is threatened against Seller and there are no facts or state of facts existing
that (with or without the giving of notice) or the passage of time or both)
could form the basis for any such action or proceeding. Seller has not executed
or filed any agreement with the Internal Revenue Service or any other taxing
authority extending the period for the assessment or collection of any Taxes.
3.10 LITIGATION. There is no suit, proceeding, action, claim or
investigation, at law or in equity, pending or, to Seller's knowledge,
threatened against or affecting in any way the assets, properties or property
interests of Seller. To the best of Seller's knowledge, there are no facts or
state of facts existing that (with or without the giving or notice or the
passage of time or both) could form the basis for any such suit, proceeding,
action, claim or investigation. Neither Seller nor any of its assets, property
or property interests is subject to any judgement, order, writ, injunction or
decree of any court or any federal, state, municipal, foreign or other
governmental authority, department, commission, board, bureau, agency or other
instrumentality.
3.11 EMPLOYEE BENEFIT PLANS; ERISA.
(a) SCHEDULE 3.12 hereto lists all employee benefit plans (as defined
in Section 3(3) of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA")) and each other employee benefit arrangement, contract,
agreement or policy, including, without limitation,
-11-
pension, profit sharing or thrift plans, medical benefit programs, death benefit
and disability programs, and severance, vacation and sick leave policies
applicable to employees of the Seller (hereinafter referred to collectively as
the "Plans").
(b) To the best of Seller's knowledge, all Plans have complied in all
material respects with all applicable requirements of the Internal Revenue Code
of 1986, as amended (the "Code"), and any predecessor Federal income tax laws,
ERISA, all other applicable laws and any applicable collective bargaining
agreements.
(c) No single employer defined benefit pension plan or defined benefit
plan for a controlled group of corporations included within the Plans has since
1976: (i) has any accumulated minimum funding deficiency; (ii) been granted a
waiver of the minimum funding standards contribution; (iii) been terminated by
its plan sponsor or the Pension Benefit Guaranty Corporation ("PBGC"); or (iv)
incurred or reported a reportable event; and no such Plan has assets valued at
fair market value that are less than the present value of all accrued
liabilities using PBGC actuarial and interest rate assumptions in effect on the
date hereof as applicable to single employer plan terminations or plans for a
controlled group of corporations.
3.12 CONSENTS AND APPROVALS; NO VIOLATION. Neither the execution nor
delivery by Seller of this Agreement, or any agreement, document or instrument
executed and delivered or to be executed and delivered in connection with the
transactions contemplated hereby, nor the consummation by Seller of the
transactions contemplated hereby or thereby, nor compliance by Seller with any
of the provisions hereof or thereof, will (a) conflict with or result in a
breach of any provision of SBP's Articles of Incorporation or Bylaws, (b) result
in the breach of, or conflict with, any of the terms and conditions of, or
constitute a default (with or without the giving of notice or the passage of
time or both) with respect to, or result in the cancellation or termination of,
or the acceleration of the performance of any obligations or of any indebtedness
under, any Material Agreement, (c) result in the creation of a lien, security
interest, charge or encumbrance upon any of the Assets, or (d) violate any law
or any rule or regulation of any administrative agency or governmental body, or
any order, writ, injunction or decree of any court, administrative agency or
governmental body to which any Seller or its properties or assets may be
subject. No approval, authorization, consent or other action of, or filing with,
or notice to any court, administrative agency or other governmental authority or
any other person or entity is required for the execution and delivery by any
Seller of this Agreement or any agreement, document or instrument executed and
delivered or to be executed and delivered in connection with the transactions
contemplated hereby or thereby, or the consummation of the transactions
contemplated hereby or thereby.
3.13 LICENSES, PERMITS AND AUTHORIZATIONS. Seller has all permits,
licenses, certificates of occupancy, approvals or other authorizations from and
registrations with federal, state, municipal and foreign governmental agencies
and private associations necessary to operate the Business (collectively the
"Permits") and all such Permits are in full force and effect and no suspension
or cancellation of any such Permit is threatened. All such Permits shall
continue in full force and
-12-
effect on behalf of Buyer following consummation of the transactions
contemplated by this Agreement to the extent allowable under applicable law and
regulation. A list of the Permits is included in SCHEDULE 3.13 hereto.
3.14 GUARANTEES. Except as set forth in SCHEDULE 3.15 attached hereto,
neither the Business nor any of the Assets is or will be at the Closing,
directly or indirectly, (i) liable, by guarantee or otherwise, upon or with
respect to, (ii) obligated, by discount or repurchase agreement or in any other
way, to provide funds in respect of, or (iii) obligated to guarantee or assume,
any debt, dividend or other obligation of any person, corporation, association,
partnership or other entity.
3.15 CORPORATE AND PERSONNEL DATA; LABOR RELATIONS. To the best of Seller's
knowledge, Seller is in compliance with all federal, state, local and foreign
laws, rules and regulations affecting employment and employment practices of
Seller, including those relating to terms and conditions of employment and
wages. There are no complaints pending, or to Seller's knowledge threatened,
against Seller in connection with any employment related matters. Seller is not
a party to any collective bargaining agreement. SCHEDULE 3.16 includes a monthly
report which reflects Seller's current payroll; this report accurately reflects
Seller's entire current monthly payroll obligations to its employees. SCHEDULE
3.16 also includes a list of the names and compensation levels of any
consultants, independent contractors or temporary employees regularly utilized
by Seller.
3.16 COMPLIANCE WITH LAWS/ENVIRONMENTAL MATTERS.
(a) To the best of Seller's knowledge, Seller has at all times
conducted its business and the Assets have been held in compliance with all
applicable laws, regulations, ordinances, orders and other requirements of
governmental authorities having jurisdiction over Seller. Seller has not
received any formal or informal notice, advice, claim or complaint alleging that
Seller has violated or may have violated any law, regulation, ordinance or order
and, to Seller's knowledge, no such notice, advice, claim or complaint of any
type is threatened. Seller has at all times complied and presently complies with
all applicable federal, state, local and foreign laws, rules and regulations
respecting occupational safety and health standards and Seller has not received
complaints from any employee or any federal, state, local or foreign agency
alleging any violation of any federal, state, local or foreign laws respecting
occupational safety and health standards.
(b) Without limiting the generality of the foregoing, to the best of
Seller's knowledge, (i) all real property owned or leased by Seller and all
buildings, fixtures, equipment and other improvements located thereon and the
present use thereof comply in all respects with applicable fire codes, building
codes, health codes, ordinances and regulations; (ii) the business operations of
Seller (including without limitation its leased and owned real property) are in
compliance with all applicable statutes, regulations, ordinances, decrees or
orders of governmental authorities relating to the environment (collectively the
"Environmental Laws") including without limitation those relating to Hazardous
Materials (as hereinafter defined); (iii) no Hazardous
-13-
Material has been spilled, released, deposited or discharged on any of Seller's
owned or leased real property, no such real property has been used as a landfill
or waste disposal site, and such real property is free from pollution; (iv) no
notice, information, request, citation, summons or order has been received by
Seller and no complaint has been filed and no penalty has been assessed or
threatened by any governmental authority with respect to (x) any alleged
violation by Seller of any Environmental Law, (y) any alleged failure by Seller
to have any environmental permit required in connection with the operation of
its business or (z) any generation, treatment, storage, recycling,
transportation of disposal of any Hazardous Material; and (v) there have not
previously been and are not presently any claims of any nature pursuant to any
Environmental Law on any properties owned or leased by Seller. (As used in this
Agreement, the term Hazardous Material means any hazardous or toxic substance,
material or waste or pollutants, contaminants or asbestos containing material
which is regulated by any authority in any jurisdiction in which Seller does
business.)
3.19 ACCURACY OF INFORMATION FURNISHED. No statement contained in this
Agreement or any Exhibit or Schedule attached hereto, and no statement contained
in any certificate or other instrument or document furnished by or on behalf of
Seller pursuant to this Agreement, contains or will contain any untrue statement
of a material fact or omits or will omit to state any material fact that is
necessary to make the statements contained herein or therein not misleading.
4. REPRESENTATIONS AND WARRANTIES OF BUYER. As a material inducement for Seller
to enter into this Agreement and to consummate the transactions contemplated
hereby, Buyer represents and warrants to Seller as follows:
4.1 ORGANIZATION. Buyer is a corporation duly organized, validly existing
and in good standing under the laws of the state of Illinois. Buyer has all
requisite corporate power and authority to own and operate its properties, to
carry on its business as now being conducted and to execute, deliver and perform
its obligations under this Agreement and to consummate the transactions
contemplated hereby.
4.2 AUTHORITY CONCERNING THIS AGREEMENT. The execution, delivery and
performance by Buyer of this Agreement and of each agreement, document or
instrument executed and delivered or to be executed and delivered in connection
with the transactions contemplated hereby, and the consummation of the
transactions contemplated hereby and thereby have been duly and validly
authorized and approved by all necessary corporate action of Buyer. This
Agreement is (and, when executed and delivered, each agreement, document or
instrument to be executed and delivered in connection with the transactions
contemplated hereby will be) valid and binding upon Buyer, and enforceable
against Buyer in accordance with their respective terms except to the extent
that enforcement thereof may be limited by applicable bankruptcy,
reorganization, insolvency or moratorium laws, or other laws affecting the
enforcement of creditors' rights or the principles governing the availability of
equitable remedies.
-14-
5. INDEMNIFICATION AND SET OFF.
5.1 INDEMNIFICATION OBLIGATION OF SELLER. Seller, jointly and severally,
hereby agrees to defend, indemnify and hold harmless Buyer from, against and in
respect of any loss, cost, damage or expense, including but not limited to,
legal and accounting fees and expenses (and sales taxes thereon, if any)
asserted against, imposed upon or paid, incurred or suffered by Buyer (a
"Loss"), in an amount not to exceed Three Million One Hundred Thousand Dollars
($3,100,000.00) in the aggregate:
(a) as a result of, arising from or in connection with any breach of
any representation, warranty, covenant or agreement of Seller in this Agreement
or in any agreement, document or instrument executed and delivered in connection
with the transactions contemplated hereby; or
(b) any misrepresentation or inaccuracy in, or omission from the
Disclosure Schedule or from any certificate, schedule, statement, document or
instrument furnished by Seller to Buyer in connection with the transactions
contemplated by this Agreement.
5.2 INDEMNIFICATION OBLIGATION OF BUYER. Buyer hereby agrees to defend,
indemnify and hold harmless Seller from, against and in respect of any loss,
cost, damage or expense, including but not limited to, legal and accounting fees
and expenses (and sales taxes thereon, if any) asserted against, imposed upon or
paid, incurred or suffered by Seller (a "Loss"):
(a) as a result of, arising from or in connection with any breach of
any representation, warranty, covenant or agreement of Buyer in this Agreement
or in any agreement, document or instrument executed and delivered in connection
with the transactions contemplated hereby; or
(b) as a result of, arising from or in connection with the Assumed
Obligations.
5.3 INDEMNITY PROCEDURE. A party hereto agreeing to be responsible for or
to indemnify against any matter pursuant to this Agreement is referred to herein
as the "Indemnifying Party" and the other party claiming indemnity is referred
to as the "Indemnified Party." The Indemnified Party under this Agreement shall
give prompt written notice to the Indemnifying Party of any liability which
might give rise to a claim of indemnity under this Agreement; provided, however,
that any failure to give such notice will not waive any rights of the
Indemnified Party except to the extent the rights of the Indemnifying Party are
actually prejudiced. As to any claim, action, suit or proceeding by a third
party, the Indemnifying Party shall be entitled to assume defense thereof (at
its expense) provided that counsel for the Indemnifying Party who shall conduct
the defense of such claim shall be approved by the Indemnified Party. The
Indemnified Party shall provide such cooperation and such access to its books,
records and properties as the Indemnifying Party shall reasonably request with
respect to such matter; and the parties hereto agree to cooperate with each
other in order to ensure the proper and adequate defense thereof. If in the
-15-
Indemnified Party's reasonable judgment, a conflict of interest between the
Indemnified Party and the Indemnifying Party exists in respect of a claim, or,
if the Indemnifying Party, after written notice from the Indemnified Party,
fails to take timely action to defend a claim, the Indemnified Party may assume
defense of such claim or action with counsel of its choosing at the Indemnifying
Party's cost.
Neither an Indemnifying Party nor an Indemnified Party shall make any
settlement of any claim without the written consent of the other Party, which
consent shall not be unreasonably withheld. Without limiting the generality of
the foregoing, it shall not be deemed unreasonable to withhold consent to a
settlement (i) involving injunctive or other equitable relief against the
Indemnified Party or its assets, employees or business or (ii) which does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such Indemnified Party of a release from all liability in respect of such
claim or litigation.
5.4 PAYMENT. The Indemnifying Party shall pay to the Indemnified Party any
amounts owed to the Indemnified Party pursuant to this Section 5 within twenty
(20) days after written request from the Indemnified Party to the Indemnifying
Party to make such payment accompanied by appropriate substantiating
documentation. In determining the amount owed hereunder, the parties shall make
appropriate adjustments for tax benefits and insurance proceeds. Upon the
payment in full of any claim, the Indemnifying Party shall be subrogated to the
rights of the Indemnified Party against any person, firm or entity with respect
to the subject matter of the claim or litigation.
5.5 SET OFF. Buyer shall be entitled to Set off against the Cash Payment
and the Promissory Note (i) any amounts to which Buyer may be entitled to
payment pursuant to this Section 5, (ii) any amounts due and owing to Buyer by
Seller and (iii) any amounts due and owing to third parties by Seller that Buyer
has guaranteed on behalf of Seller. Buyer shall deliver written notice to Seller
of its election to and amount of set off within five (5) business days of
Buyer's election.
6. CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE. Seller' obligation to
consummate the transactions contemplated by this Agreement shall be subject to
the fulfillment, at or prior to Closing, of each of the following conditions
precedent (any or all of which may be waived in writing, in whole or in part, by
Seller):
6.1 PERFORMANCE OF OBLIGATIONS. Buyer shall have performed all of its
obligations and complied with all of its covenants required to be performed or
to be complied with by it under this Agreement on or prior to the Closing Date.
6.2 REPRESENTATIONS AND WARRANTIES. Each representation and warranty of
Buyer contained in this Agreement shall be true and correct both at the date on
which this Agreement is signed and at and as of the Closing Date as if made at
and as of such time.
-16-
6.3 DELIVERIES. Buyer shall have delivered or caused delivery of the items
set forth in Section 2.3 of this Agreement.
7. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE. Buyer's obligation to
consummate the transactions contemplated by this Agreement shall be subject to
the fulfillment, at or prior to Closing, of each of the following conditions
precedent (any or all of which may be waived in writing, in whole or in part, by
Buyer):
7.1 PERFORMANCE OF OBLIGATIONS. Seller shall have performed all of the
obligations and complied with all of the covenants required to be performed or
to be complied with by it under this Agreement on or prior to the Closing Date.
7.2 APPROVALS. Seller shall have delivered to Buyer any and all approvals,
consents or assignments necessary for the consummation of the transactions
contemplated hereby, including, without limitation, any consents required (i) by
any governmental or administrative body, (ii) under any Material Agreement,
(iii) under any insurance policies that Buyer has determined should continue in
force after the Closing, or (iv) under any Permit.
7.3 ACCESS. Buyer shall have had full and complete access during normal
business hours to the properties, assets, books, agreements, files and records
of Seller for the purpose of verifying the information set forth herein. Buyer's
due diligence investigation shall not relieve Seller from any liability in
connection with its representations and warranties set forth in this Agreement.
7.4 FINANCIAL STATEMENTS. Buyer shall have received a copy of the Financial
Statements. Each of the Financial Statements shall be accompanied by a
certificate of a company officer in form and substance satisfactory to Buyer.
7.5 PROPERTY. All of Seller' real and personal property shall be in good
operating condition, structurally sound and in good repair. Notwithstanding the
foregoing, Buyer acknowledges that Buyer is assuming Assumed Leases and
acquiring the Assets in Schedule 1.1 in an "as is" condition.
THE ASSETS ARE BEING SOLD TO THE BUYER "AS IS" WITH ALL FAULTS AND, EXCEPT AS
SPECIFICALLY SET FORTH HEREIN, SELLER MAKES NO WARRANTY OF ANY KIND, EXPRESS OR
IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY OR FITNESS
FOR A PARTICULAR USE.
7.6 APPROVAL. The board of directors of Seller shall have approved Seller
entering into this Agreement and the consummation of the transactions
contemplated hereby. The board of directors of Buyer shall have approved Buyer's
entering into this Agreement and consummation of the transactions contemplated
hereby.
-17-
7.7 LITIGATION. There shall not have been instituted, pending or threatened
against Seller, any suit, action or other proceeding by any private party or
governmental agency, commission, bureau or body seeking to restrain or prohibit
any of the transactions contemplated by this Agreement.
7.8 ACCRUED EXPENSES AND CONTINGENT LIABILITIES. Seller shall have
resolved, in a manner satisfactory to Buyer in its sole and absolute discretion,
any issues relating to the accrued expenses and contingent liabilities of
Seller, provided any such issues have been brought to Seller's attention by
Buyer, in writing.
7.9 NONCOMPETITION AGREEMENTS. Buyer, ▇▇▇▇▇▇ and all branch office
personnel of Seller, identified by Buyer, shall have entered into a
Noncompetition Agreement prohibiting ▇▇▇▇▇▇ and all branch office personnel from
competing within the metropolitan Colorado Springs area.
7.10 DISCLOSURE SCHEDULE. Seller shall have furnished to Buyer and its
representatives true, correct and complete copies of all documents, agreements
and instruments listed in the Disclosure Schedule.
7.11 DELIVERIES. Seller shall have delivered or caused delivery of the
items set forth in Section 2.2 hereof.
7.12 REPRESENTATIONS AND WARRANTIES. Each representation and warranty of
Seller contained in this Agreement shall be true and correct both at the date on
which this Agreement is signed and at and as of the Closing Date as if made anew
at and as of such time.
7.13 OPINION OF SELLER' COUNSEL. Buyer shall have received an opinion from
counsel of Seller dated as of the Closing Date and in substantially the form
attached as EXHIBIT J hereto.
7.14 RIGHT TO USE NAME. Buyer shall have received a certification of its
right to use the name "Stand-by Personnel" for a period of twelve (12) months
from the date of Closing at no charge.
8. POST-CLOSING COVENANTS.
8.1 ACCOUNTS RECEIVABLE OF BUYER. Seller covenants and agrees that if
Seller inadvertently collects an account receivable of the Buyer, Seller will
deliver the amount received to Buyer within ten (10) days of receipt by Seller.
8.2 ACCOUNTS RECEIVABLE OF SELLER. Buyer covenants and agrees that if Buyer
inadvertently collects an account receivable of a Seller, Buyer will deliver the
amount received to Seller within ten (10) days of receipt by Buyer.
-18-
8.3 ACCOUNTS RECEIVABLE REPORTS. Both Buyer and Seller covenant and agree
that they will deliver a weekly accounts receivable report to each other for
ninety (90) days following the Closing Date.
8.4 FURTHER ASSURANCES. Seller covenants and agrees with Buyer, its
successors and assigns, that it will do, execute, acknowledge and deliver, or
cause to be done, executed, acknowledged and delivered, any and all such further
acts, instruments, papers and documents as may be necessary to carry out and
effectuate the intent and purposes of this Agreement.
9. MISCELLANEOUS.
9.1 ENTIRE AGREEMENT. This Agreement and the Exhibits and Schedules to this
Agreement constitute the entire agreement between the parties hereto with
respect to the subject matter hereof and supersede all prior negotiations,
understandings, agreements, arrangements and understandings, both oral and
written, between the parties hereto with respect to such subject matter. The
Exhibits and Schedules to this Agreement are incorporated into and constitute
part of this Agreement.
9.2 AMENDMENT. This Agreement may not be amended or modified in any
respect, except by the mutual written agreement of the parties hereto.
9.3 NO THIRD PARTY BENEFICIARY. Nothing expressed or implied in this
Agreement is intended, or shall be construed, to confer upon or give any person,
firm, corporation, partnership, association or other entity, other than the
parties hereto and their respective successors and permitted assigns, any rights
or remedies under or by reason of this Agreement.
9.4 SURVIVABILITY. Notwithstanding any investigation made by or on behalf
of any party to this Agreement, the representations and warranties made under
and in connection with this Agreement shall be true and correct on and as of the
Closing Date with the same effect as if made on and as of such date and shall
survive the Closing and consummation of all the transactions contemplated
hereby.
9.5 WAIVERS AND REMEDIES. The waiver by any of the parties hereto of any
other party's prompt and complete performance, or breach or violation, of any
provision of this Agreement shall not operate nor be construed as a waiver of
any subsequent breach or violation, and the waiver by any of the parties hereto
to exercise any right or remedy which it may possess hereunder shall not operate
nor be construed as a bar to the exercise of such right or remedy by such party
upon the occurrence of any subsequent breach or violation.
9.6 SEVERABILITY. The invalidity of any one or more of the words, phrases,
sentences, clauses, sections or subsections contained in this Agreement shall
not affect the enforceability of the remaining portions of this Agreement or any
part hereof, all of which are inserted conditionally on their being valid in
law, and, in the event that any one or more of the words, phrases,
-19-
sentences, clauses, sections or subsections contained in this Agreement shall be
declared invalid by a court of competent jurisdiction, this Agreement shall be
construed as if such invalid word or words, phrase or phrases, sentence or
sentences, clause or clauses, section or sections, or subsection or subsections
had not been inserted.
9.7 DESCRIPTIVE HEADINGS/RECITALS. Descriptive headings contained herein
are for convenience only and shall not control or affect the meaning or
construction of any provision of this Agreement. The recitals are incorporated
into and made a part of this Agreement.
9.8 COUNTERPARTS AND FACSIMILE SIGNATURES. This Agreement may be executed
in counterparts by the separate parties hereto, all of which shall be deemed to
be one and the same instrument. Facsimile signatures shall have the same effect
as original signatures.
9.9 NOTICES. All notices, consents, requests, instructions, approvals and
other communications provided for herein and all legal process in regard hereto
shall be in writing and shall be deemed to have been duly given: when delivered
by hand; when delivered by facsimile (if written confirmation of receipt of the
facsimile is obtained from the party to be charged with notice); five (5) days
after being deposited in the United States mail, by registered or certified
mail, return receipt requested, postage prepaid; or on the second business day
after being sent (PREPAID for next day delivery), via Federal Express, Purolator
Courier, DHL or other nationally recognized delivery service, as follows:
If to Seller: ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
With a copy to: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇. Esq.
Flynn, McKenna, ▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇
If to Buyer: OutSource International, Inc.
Attention: CEO
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇
-20-
With a copy to: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Holland & Knight
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: ▇▇▇ ▇▇▇-▇▇▇▇
Fax: ▇▇▇ ▇▇▇-▇▇▇▇
or to such other address as any party hereto may from time to time designate in
writing delivered in a like manner.
9.10 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and
permitted assigns. None of the parties hereto shall assign any of its rights or
obligations hereunder without the express written consent of the other party
hereto.
9.11 APPLICABLE LAW. This Agreement shall be governed by, and shall be
construed, interpreted and enforced in accordance with, the laws of the State of
Florida.
9.12 BROKERS AND AGENTS. OutSource has engaged Equitable Business and
Financial Services ("Equitable") in bringing OutSource and SBP together in this
transaction. SBP has not engaged a broker with respect to this transaction.
OutSource and SBP recognize Equitable as the sole procuring cause for the sale.
Equitable will receive a commission as per its agreement with OutSource, and
OutSource will indemnify and hold SBP harmless in regard to the payments of any
commission due or payable to Equitable as a result of this transaction.
9.13 EXPENSES. Each of the parties hereto agrees to pay all of the
respective expenses incurred by it in connection with the negotiation,
preparation, execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby, including accountants' and
attorneys' fees (except that OutSource and SBP will each pay 50% of any fees in
the event that an audit must be performed).
9.14 CONFIDENTIALITY. No party hereto shall divulge the existence of the
terms of this Agreement, the transactions contemplated hereby or any information
about another party that such party may have acquired in connection with the
transaction, without the prior written approval of all of the parties hereto,
except and as to the extent (i) obligated by law or, (ii) necessary for such
party to defend or prosecute any litigation in connection with the transactions
contemplated hereby. The parties hereto acknowledge that any breach of the
foregoing will give rise to irreparable injury that is not compensable in
damages and agree that any party may seek and obtain equitable relief in the
form of specific enforcement, temporary restraining order, temporary or
permanent injunction, or any other equitable remedy that may then be available
to such party against the breach or threatened breach of such covenants, in
addition to any other legal remedies which may be available.
-21-
9.15 CERTAIN INTERPRETATIONS. Words such as "herein," "hereof," "hereunder"
and words of similar import refer to this Agreement as a whole and not to any
particular Section or subsection of this Agreement. The word "material" as used
in this Agreement shall mean a deviation of more than five (5%) percent.
9.16 CONSENT TO JURISDICTION. The parties to this Agreement agree that any
claim, suit, action or proceeding arising out of or relating to this Agreement
or the transactions contemplated hereby shall be submitted for adjudication
exclusively in any Florida state or federal court sitting in Broward County,
Florida and each of the parties hereto expressly agrees to be bound by such
selection of jurisdiction and venue for purposes of such adjudication. Each
party (i) waives any objection which it may have that such court is not a
convenient forum for any such adjudication, (ii) agrees and consents to the
personal jurisdiction of such court with respect to any claim or dispute arising
out of or relating to this Agreement or the transactions contemplated hereby and
(iii) agrees that process issued out of such court or in accordance with the
rules of practice of such court shall be properly served if served personally or
served by certified mail or other form of substituted service, as provided under
the rules of practice of such court. In the event of any suit, action or
proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby the prevailing party thereunder shall be entitled to recover
reasonable attorneys' and paralegal's fees (for negotiations, trials, appeals
and collection efforts) and court costs incurred in connection therewith in
addition to any other relief to which such party may be entitled.
9.17 EQUITABLE RELIEF. The parties hereto acknowledge and agree that any
party's remedy at law for any breach or threatened breach of this Agreement
which relates to requiring that the breaching party take any action or refrain
from taking any action, would be inadequate and such breach or threatened breach
shall be per se deemed as causing irreparable harm to such party. Therefore, in
the event of such breach or threatened breach, the parties hereto agree that in
addition to any available remedy at law, including but not limited to monetary
damages, an aggrieved party shall be entitled to obtain equitable relief in the
form of specific enforcement, temporary restraining order, temporary or
permanent injunction, or any other equitable remedy that may then be available
to the aggrieved party.
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
as of the date first above written.
BUYER:
Witness:
OutSource International, Inc.
--------------------- By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
--------------------
▇▇▇▇▇ ▇▇▇▇▇
--------------------- Regional Vice President
-22-
SELLER:
Witness:
Standby Personnel of Colorado Springs, Inc.
--------------------- By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------- President
SELLER:
▇▇▇▇▇▇ ▇▇▇▇▇▇
BY: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
LIST OF EXHIBITS
Exhibit A List of Assumed Obligations
Exhibit B Allocation of Purchase Price
Exhibit C Promissory Note
Exhibit D ▇▇▇▇ of Sale
Exhibit E Assignment and Assumption Agreement
Exhibit G Noncompetition Agreement
Exhibit H Lease Assignment and Assumption Agreement
Exhibit I Assignment of Applications
Exhibit J Opinion of Counsel
LIST OF SCHEDULES
Schedule 1 Locations
Schedule 1.1 Assets
Schedule 1.4 Assumed Leases
Schedule 3.1 Title to Assets; Permitted Liens
Schedule 3.2 Corporate Status of SBP
Schedule 3.4 Condition of Personal Property
Schedule 3.5 Financial Statements; Undisclosed Liabilities
Schedule 3.6 Absence of Certain Changes or Events
Schedule 3.7 Contracts and Commitments
Schedule 3.8 Intellectual Property
Schedule 3.11 Employee Benefit Plans; ERISA
Schedule 3.13 Licenses, Permits and Authorizations
Schedule 3.16 Corporate and Personnel Data; Labor Relations