EXHIBIT 10.17
ASSET PURCHASE AGREEMENT
THIS AGREEMENT, dated as of November __, 1997, among CARRIAGE FUNERAL
HOLDINGS, INC., a Delaware corporation (the "Purchaser"), ▇▇▇▇▇ FUNERAL GROUP,
INC., an New Jersey corporation (the "Company"), and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (the
"Shareholder") (the Company and the Shareholder being sometimes hereafter
referred to together as the "Sellers");
W I T N E S S E T H:
WHEREAS, the Company owns all of the operating assets, rights and
properties, other than real property, associated with the operation of the ▇▇▇▇
▇. Day Funeral Home located at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ in Red Bank, Monmouth County,
New Jersey (the "Red Bank Home"), the two Bedle Funeral Homes located at ▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ in Keyport, Monmouth County, New Jersey (the "Keyport Home") and at
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ in Matawan, Monmouth County, New Jersey (the "Matawan Home"),
and the ▇▇▇▇▇ Funeral Home located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ (the "Eatontown Home"), and owns all of the assets, rights
and properties, including real property, associated with the operation of the
Family Arrangement Center located at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇ in Red Bank, Monmouth
County, New Jersey (the "Family Center") (the Red Bank Home, the Keyport Home,
the Matawan Home, the Eatontown Home and the Family Center being hereafter
collectively referred to as the "Homes");
WHEREAS, the Shareholder owns all of the issued and outstanding
capital stock of the Company; and
WHEREAS, the parties desire that the Purchaser acquire substantially
all of such assets, rights and properties of the Homes from the Company, and
that the parties enter into certain related transactions, on the terms and
subject to the conditions hereafter set forth;
NOW, THEREFORE, the parties agree as follows:
1. PURCHASE AND SALE OF ASSETS.
1.1. TRANSFER OF ASSETS BY THE COMPANY. Subject to the provisions
of this Agreement, the Company agrees to sell, and the Purchaser
agrees to purchase, at the Closing referred to in Section 2.1,
substantially all of the properties, assets, rights and business of
the Homes of every kind and description, tangible and intangible,
real, personal or mixed, wherever located, as they shall exist at the
time of the Closing (collectively, the "Assets"), including, but not
limited to, all of
the following-described assets, rights and properties (but excluding
those described in Section 1.2):
(i) inventories of caskets, vaults, urns, accessories,
monuments and other goods and inventories;
(ii) notes and accounts receivable; and
(iii) machinery, equipment, motor vehicles (13),
furniture, fixtures, supplies, tools and other fixed assets and
property, plant and equipment, including those described on
Schedule 3.10 hereto;
(iv) fee simple title to the real property on which the
Family Center is situated (the "Family Center Tract");
(v) all cash balances in bank accounts and certificates
of deposit and other investments to fund obligations under
preneed contracts;
(vi) all pre-need contracts of the Homes and other
agreements, leases and commitments described on Schedule 3.11,
including (without limitation) the Redemption Agreement dated
November 4, 1997 between the Company and ▇▇▇▇▇▇▇ ▇▇▇▇▇ (but
excluding those contracts and commitments shown thereon, if any,
as not being assumed by the Purchaser);
(vii) all rights to the names "▇▇▇▇▇ Funeral Group", "▇▇▇▇
▇. Day Funeral Home", "Bedle Funeral Home" and "▇▇▇▇▇ Funeral
Home" and all derivatives thereof, and all trademarks, trade
names, patents, processes, copyrights, know-how and similar
intangible rights, and all goodwill associated therewith;
(viii) all permits, licenses, books, records, brochures and
literature, rights in unemployment compensation, industrial
accident and other similar funds, and prepaid items; and
(ix) all other assets, rights and properties owned or
leased by the Company that are used in or necessary for the Homes
at the time of Closing, excluding those described in Section 1.2.
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At the Closing, the Company shall convey to the Purchaser the Assets
free and clear of any and all liens, security interests, pledges,
encumbrances, easements, rights-of-way or title restrictions of any
kind (collectively, "Liens") except (in the case of the Family Center
Tract only) for Permitted Encumbrances described on Schedule 3.5.
1.2. RETAINED ASSETS. Notwithstanding the foregoing, the
following properties, assets, rights and interests (the "Retained
Assets") are hereby excluded from the purchase and sale contemplated
hereby and are therefore not included in the Assets:
(i) all cash on hand, in transit or on deposit,
including bank account balances, certificates of deposit and
marketable securities, excluding, however, account balances and
certificates of deposit to fund preneed contracts;
(ii) any prepaid federal income taxes of the Company, and
any rights to or claims for federal income tax refunds, in
respect of the operation of the Homes prior to the Closing; and
(iii) the two motor vehicles, the accounts receivable due
the Company from two existing employees and any life insurance
policy on the life of the Shareholder or any of the other parties
to the Employment Agreements referred to in Section 2.2(i), all
as described on Schedule 1.2 hereto.
1.3. PURCHASE PRICE. The purchase price for the Assets shall be
$13,315,799.00 (the "Purchase Price"). Of the Purchase Price, (i) an
amount sufficient to discharge indebtedness of the Company as
determined by the Purchaser pursuant to Section 1.4 shall be paid to
the holders of such indebtedness, (ii) the sum of $2,000,000.00 (the
"Deferred Purchase Price") shall be payable in forty-eight (48) equal
quarterly installments of $41,666.67
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each, payable on or before the last day of each January, April, July
and October during the twelve- year period following the Closing,
commencing January 31, 1998 and continuing quarterly thereafter until
paid in full, (iii) the sum of $100,000.00 shall be withheld from the
Purchase Price by the Purchaser, subject to disbursement under the
circumstances and subject to the conditions described in Section 10.5,
and (iv) the balance of the Purchase Price, after deducting the
amounts in clauses (i) through (iii) above, shall be paid to the
Company in cash at Closing by wire transfer to such account as the
Sellers shall designate in writing at least three business days prior
to the Closing. No interest shall accrue or be payable in respect to
the Deferred Purchase Price. For federal income tax purposes, the
parties agree that the Deferred Purchase Price shall be deemed to
include an imputed rate of interest of seven percent (7.0%) per annum.
The Deferred Purchase Price shall be subject to offset as provided in
Section 10.4. The Purchase Price shall be subject to adjustment
following the Closing as provided in Section 1.4. The Purchaser
acknowledges that its obligations to pay Deferred Purchase Price will
be assigned by the Company 50% to the Shareholder and 50% to ▇▇▇▇▇▇▇
▇▇▇▇▇ following the Closing, and that upon the death of either such
person such payments shall continue to be made to such person's
estate, heirs and beneficiaries.
1.4. ADJUSTMENT TO PURCHASE PRICE. At least two business days
prior to the Closing, the Sellers shall deliver to the Purchaser a
written statement, certified by them to be accurate and complete,
setting forth a description, and the outstanding balance as of the
date of such statement, of all liabilities and obligations of the
Company, including (but not limited to) indebtedness for borrowed
money, indebtedness secured by Liens against any of the Assets,
accounts and trade payable, accrued liabilities, federal, state and
local taxes, any liabilities under suits, claims judgments or orders
then pending, or any other
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liability or obligation (collectively, "Unassumed Liabilities"),
excluding only Assumed Liabilities described in Section 1.5. At
Closing, the Purchaser shall pay out of the Purchase Price such
portion thereof as shall be required to pay and discharge those
Unassumed Liabilities as the Purchaser in its sole discretion deems
appropriate, which at a minimum shall include liabilities secured by
Liens against any of the Assets, and any and unsecured indebtedness
for borrowed money, but may also include any of such other
liabilities. Notwithstanding such payment, the Sellers shall remain
responsible for paying any remaining Unassumed Liabilities. Payments
under this Section 1.4 shall be deemed downward adjustments in the
Purchase Price.
1.5. ASSUMPTION OF LIABILITIES. The Purchaser, upon the sale and
purchase of the Assets, shall, subject to Section 1.6 below, assume
and agree to pay or discharge only the following liabilities and
obligations of the Company (collectively, the "Assumed Liabilities"):
(i) liabilities under those preneed contracts of the
Homes that are included in the Assets, provided that as of the
Closing such liabilities are covered by trust or insurance to the
full extent required by the rules, regulations and procedures of
New Jersey law; and
(ii) obligations arising after Closing under the agree
ments, leases and commitments of the Homes described in Schedule
3.11 (other than agreements, leases and commitments, if any,
which are indicated on such Schedule as not to be assumed by the
Purchaser).
The assumption by the Purchaser of the Assumed Liabilities shall
not enlarge any rights or remedies of any third parties under any
contracts or arrangements so assumed. Nothing herein shall prevent the
Purchaser from contesting in good faith
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any of the Assumed Liabilities. At Closing, the Purchaser shall
deliver to the Company an instrument, dated the Closing Date and
reasonably satisfactory in form and substance to it, pursuant to which
the Purchaser will assume the Assumed Liabilities.
1.6. LIMITATIONS ON ASSUMPTION. Notwithstanding Section 1.5
above, the Purchaser will not assume and does not agree to pay or
discharge any obligations or liabilities of the Company not specif
ically included in the Assumed Liabilities. In particular, without
limiting the generality of the definition of "Unassumed Liabilities"
under Section 1.4 above, the Purchaser shall not assume or agree to
pay or discharge any of the following:
(i) any notes or accounts payable;
(ii) any trade payables of any kind, regardless of
whether entered into in the ordinary course of business;
(iii) any federal, state or local tax of any type, whether
arising by reason of the sale of the Assets or by operation of
the Homes prior to the Closing Date;
(iv) any losses, costs, damages or expense based upon or
arising from any claims, litigation, legal proceedings or other
actions against the Company based upon any set of facts occurring
prior to the Closing;
(v) the liabilities and obligations under any war
ranties to customers with respect to goods or products sold or
services provided by the Company prior to Closing;
(vi) all personal injury, product liability claims,
claims of environmental damage, claims of hazards to health,
strict liability, toxic torts, enforcement proceedings, cleanup
orders and other similar
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actions or claims instituted by private parties or governmental
agencies, with respect to the operation of the Homes prior to
Closing; or
(vii) any other liability or obligation not specifically
included within the Assumed Liabilities.
1.7. CERTAIN PRORATIONS. All normal and customarily proratable
items, including without limitation, real estate and personal property
taxes, rents under leases and utility bills, shall be prorated as of
the Closing Date, the Company being charged and credited for all of
same up to such date and the Purchaser being charged and credited for
all of same on and after such date. Utility services will be
transferred to the Purchaser's name on the Closing Date. If the actual
amounts to be prorated are not known as of the Closing Date, the
prorations shall be made on the basis of the best evidence then
available, and thereafter, within thirty (30) days after actual
figures are received, a cash settlement will be made between the
Company and the Purchaser.
1.8. INSTRUMENTS OF TRANSFER. At the Closing, the Sellers shall
deliver to the Purchaser such instruments of transfer, assignment and
conveyance, including (without limitation) bills of sale, general
warranty deeds, lease assignments and assignments of motor vehicle
registrations, transferring title to the Assets to the Purchaser as
may reasonably be requested by the Purchaser. Such instruments shall
be reasonably satisfactory in form and substance to the Purchaser and
shall vest in the Purchaser good and marketable title to all the
Assets, free and clear of all Liens (except, in the case of the Family
Center Tract, for Permitted Encumbrances).
1.9. DELIVERY OF RECORDS, CONTRACTS AND TRUST FUNDS. At the
Closing, the Company will deliver to the Purchaser all of the leases,
contracts, commitments and rights of the Homes constituting a
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portion of the Assets, with such assignments thereof and consents to
assignment as the Purchaser shall deem necessary to assure the Pur
chaser of their full benefit. Simultaneously with such deliveries, the
Company shall take all requisite steps to put the Purchaser in actual
possession and operating control of the Assets and all of the records,
books and other data of the Homes. In addition, at the Closing, the
Sellers and the Purchaser shall take all necessary or appropriate
action to cause the transfer of the trust funds referred to in Section
3.11 including, without limitation, the obtaining of governmental and
third party consents.
1.10. TAXES. Any sales or transfer taxes which may be payable in
connection with the sale of the Assets under this Agreement shall be
paid by the Sellers.
1.11. EMPLOYEE MATTERS. On the Closing Date, the Purchaser may
(but shall not be required to) offer employment to each employee of
the Homes listed on Schedule 3.19. Each such employee so offered
employment who accepts shall, effective as of the Closing Date, cease
to be an employee of the Company and shall thereupon become an
employee of the Purchaser. The Sellers shall be responsible for
satisfying all claims, if any, of such employees as to holiday, health
benefits, workers compensation claims, termination and severance
benefits, and any withdrawal liability and vested rights under any
pension or profit sharing plans, all arising and accrued through the
Closing Date, and in no event shall the Purchaser have any liability
or responsibility in respect thereof. The Purchaser agrees that it
will assume responsibility for such employees' accrued vacation, but
only for five payroll days accrued as of January 1, 1998.
1.12. FURTHER ASSURANCES. The Sellers shall from time to time
after the Closing, without further consideration, execute and deliver
such instruments of transfer, conveyance and assignment
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(in addition to those delivered pursuant to Section 1.8), and shall
take such other action, as the Purchaser may reasonably request to
more effec tively transfer, convey and assign to and vest in the
Purchaser, and to put the Purchaser in actual possession and control
of, each of the Assets.
2. THE CLOSING.
2.1. TIME AND PLACE. The closing of the transactions contemplated
under this Agreement (the AClosing@) shall occur at the offices of
Schanker and ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
at 9:00 a.m. on November 13, 1997, or at such other date, time or
place as may be mutually agreed upon by the parties, but in no event
later than November 30, 1997. The date and time of the Closing is
herein called the "Closing Date", and shall be deemed to have occurred
as of the commencement of business on the Closing Date. All action to
be taken at the Closing as hereinafter set forth, and all documents
and instruments executed and delivered, and all payments made with
respect thereto, shall be considered to have been taken, delivered or
made simultaneously, and no such action or delivery or payment shall
be considered as complete until all action incident to the Closing has
been completed.
2.2. RELATED TRANSACTIONS. In addition to the purchase and
sale of the Assets, the following transactions shall take place at
the Closing:
(i) the Purchaser, on the one hand, and each of ▇▇▇▇▇▇▇
▇▇▇▇▇ ("▇▇▇▇▇▇▇"), ▇▇▇ ▇▇▇▇▇ ("▇▇▇") and ▇▇▇▇ ▇▇▇▇▇ ("▇▇▇▇"), on
the other, shall each execute and deliver to the other an
Employment Agreement to be dated the Closing Date, substantially
in the forms of Exhibits ▇-▇, ▇-▇ ▇▇▇ ▇-▇, respectively, hereto
(collectively, the "Employment Agreements");
(ii) the Purchaser, as tenant, and CAT Real Estate
Partnership, a New Jersey
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general partnership ("CAT"), as landlord, shall each execute
and deliver to the other a Lease Agreement to be dated the
Closing Date, covering the real estate and improvements on
which the Red Bank Home is situated, substan tially in the
form of Exhibit B hereto (the "Lease Agreement"); and
(iii) on the date of this Agreement, the Purchaser and
(x) the ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Charitable Remainder Trust ("CRT"), have
entered into a Real Property Purchase Agreement (the AMatawan
Real Property Agreement@) providing for, among other things, the
sale by the CRT to the Purchaser of fee simple title to the real
property and improvements on which the Matawan Home is situated,
and (y) ▇▇▇▇▇▇▇ have entered into a Real Property Purchase
Agreement (the AKeyport/Eatontown Real Property Agreement@)
providing for, among other things, the sale by ▇▇▇▇▇▇▇ to the
Purchaser of fee simple title to the real property and
improvements on which the Keyport and Eatontown Homes are
situated; and the Closing hereunder is subject to the closing
substantially simultaneously therewith of such purchase and sale
transactions under the Matawan Real Property Agreement and the
Keyport/Eatontown Real Property Agreement (collectively, the
"Real Property Agreements").
3. REPRESENTATIONS AND WARRANTIES OF THE SELLERS. The Sellers jointly
and severally represent and warrant to and agree with the Purchaser that:
3.1. ORGANIZATION AND EXISTENCE. The Company is a corporation
duly organized, validly existing and in good standing under the laws
of the State of New Jersey, and has all requisite corporate power to
enter into and perform its obligations under this Agreement. The
Company is the surviving corporation of the merger among ▇▇▇▇ ▇. Day
Funeral Home, Inc. ("Day"), Bedle Funeral Home, Inc. ("Bedle") and
▇▇▇▇▇ Funeral Home, Inc.
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("▇▇▇▇▇"), all New Jersey corporations. For purposes hereof, any
reference to the "Company" shall, with respect to any time or period
prior to the effective time of such merger, include and incorporate
each of Day, Bedle and ▇▇▇▇▇, as the context requires.
3.2. OWNERSHIP OF THE COMPANY. The Shareholder owns all of
the issued and outstanding capital stock of the Company.
3.3. FINANCIAL STATEMENTS. The Sellers have delivered to the
Purchaser (i) the unaudited (reviewed) combined balance sheets of Day,
Bedle and ▇▇▇▇▇ at December 31, 1995 and 1996 (such balance sheet at
December 31, 1996 being hereafter referred to as the "Company Balance
Sheet") and the related unaudited (reviewed) combined statements of
income and retained earnings of Day, Bedle and ▇▇▇▇▇ for the
respective twelve-month periods of operations then ended, together
with the notes thereto and the review report thereon of ▇▇▇▇▇ & Co.,
LLC dated January 17, 1997, and (ii) the unaudited (reviewed) combined
balance sheets of Day, Bedle and ▇▇▇▇▇ at December 31, 1994 and 1995
and the related unaudited (reviewed) combined statements of income and
retained earnings of Day, Bedle and ▇▇▇▇▇ for the respective
twelve-month periods of operations then ended, together with the notes
thereto and the review report thereon of ▇▇▇▇▇ & Co., LLC dated
January 22, 1996. All of such financial statements are true and
correct, have been prepared in accordance with the books and records
of Day, Bedle and ▇▇▇▇▇ (now of the Company), and present fairly the
combined financial positions of Day, Bedle and ▇▇▇▇▇ at the dates
thereof and their combined results of operations for the periods then
ended in accordance with generally accepted accounting principles
consistently applied. The total assets of the "acquired person" (as
that term is used in the ▇▇▇▇- ▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act
of 1976, as amended), with respect to the transactions described
herein, as reflected in the most recent regularly prepared balance
sheet, is less than $10
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million. The Homes collectively performed at least the number of adult
casketed funeral services for each of the periods as shown below:
TWELVE MONTHS ENDED DECEMBER 31, SIX MONTHS
--------------------------------------- ENDED JUNE 30,
LOCATION 1994 1995 1996 1997
-------- ---- ---- ---- ----
Red Bank ......... 310 371 403 214
Keyport .......... 64 86 74 38
Matawan .......... 40 39 45 19
Eatontown ........ 99 108 108 46
3.4. TITLE TO AND STATUS OF ASSETS. All assets, rights and prop
erties required in the operation of the Homes are owned or validly
leased by the Company and (except for the real property covered by the
Lease Agreement and the Real Property Agreements) are included within
the Assets. The Company is in actual possession and control of all
properties owned or leased by it which are required in the operation
of the Homes, and has good and marketable title to all of the Assets,
free and clear of all Liens (except for Permitted Liens against the
Family Center Tract). The Family Center Tract, together with the real
property covered by the Lease Agreement and the Real Property
Agreements (collectively, the "Real Property"), constitute all
interests in real property required in the operation of the Homes.
3.5. FAMILY CENTER TRACT.
(a) DESCRIPTION AND TITLE. Schedule 3.5 sets forth a legal
description of the Family Center Tract. No person other than the
Company has any ownership, leasehold or other interest of any kind in
the Family Center Tract. The Family Center Tract is the only interest
in real property
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required for the conduct of the business of the Family Center as
presently conducted. No improvements located on the Family Center
Tract, nor the operation or maintenance thereof as now operated or
maintained, contravenes any zoning ordinance or other administrative
regulation or violates any restrictive covenant or any provision of
law, the effect of which would interfere with or prevent their
continued use for the purposes for which they are now being used.
There is not pending nor, to the knowledge of the Sellers, threatened
any proceeding for the taking or condemnation of the Family Center
Tract or any portion thereof. All improvements located on the Family
Center Tract are in a reasonable state of maintenance and repair,
ordinary wear and tear excepted. The Company has good and marketable
fee simple title to the Family Center Tract, free and clear of all
Liens, other than easements and other similar Liens described on
Schedule 3.5 ("Permitted Encumbrances").
(b) FIRPTA. No Seller is a "foreign person" (as defined in
Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended
(the "Code"), and the regulations issued thereunder), and the Company
shall deliver at Closing a non-foreign affidavit in recordable form
containing such information as shall be required by Code Section
1445(b)(2) and the regulations issued thereunder.
(c) BILLS PAID. All bills and other payments due with respect to
the ownership, operation, and maintenance of the Family Center Tract
have been (and on the Closing Date will be) paid, and no Liens or
other claims for the same have been filed or asserted against any part
of the Family Center Tract.
3.6. ABSENCE OF CHANGES OR EVENTS. Since the date of the
Company Balance Sheet, there has not been:
(i) any adverse change in the financial condition,
operations, properties or prospects of any Home;
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(ii) any material damage, destruction or losses against
any Home or any of its properties;
(iii) any claim or liability for any material damages for
any actual or alleged negligence or other tort or breach of
contract against or affecting the Company;
(iv) any declaration or payment of any bonus or other
extraordinary compensation to any employee of the Company;
(v) any hiring, firing, reassignment or other change in
any key personnel of the Company;
(vi) any sale, transfer or other disposition of, or
agreement to sell, transfer or otherwise dispose of, any of the
inventories or other assets or properties of the Company, except
in the ordinary course of business;
(vii) any labor strike or labor dispute, or the entering
into of any collective bargaining agreement, with respect to
employees of the Company;
(viii) any new competitor that has, to the knowledge of the
Shareholder, built, commenced to build or announced intentions to
build a funeral home or mortuary in direct competition with any
Home; or
(ix) any other transaction or event entered into or
affecting the Company other than in the ordinary course of
business.
3.7. ABSENCE OF UNDISCLOSED LIABILITIES. Except as set forth in
the Company Balance Sheet and in this Agreement, the Company has no,
and none of its assets or properties are subject to any, liabilities
or obligations, other than unsecured
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trade accounts payable and accrued expenses arising in the ordinary
course of business since the date of the Company Balance Sheet.
3.8. TAX MATTERS. All federal, state, county, local and other
taxes due and payable on or before the date of this Agreement in
respect of the Company and the ownership of the Assets, have been
paid. All tax returns and reports required to be filed for all such
taxes have been filed with all taxing authorities, and all such tax
returns and reports are true and correct. True and correct copies of
the federal, state and local income tax returns filed by the Company
for each of its last three taxable years have been furnished to the
Purchaser. No assessments of deficiencies have been made against the
Company which are presently pending or outstanding, and no state or
facts exist which would constitute grounds for any such assessment. No
agreements, waivers or extensions of time are in effect for the
assessment of deficiencies in respect of the Company or any of the
Assets. Following the Closing, the Sellers shall be responsible for
accurately and completely preparing, signing and filing all tax
returns and paying all taxes in respect of the assets and operations
of the Company through the Closing Date and for the sale of the
Assets.
3.9. INVENTORY; ACCOUNTS RECEIVABLE. All inventories reflected in
the Company Balance Sheet are, and all inventories of the Company on
the Closing Date will be, (i) accounted for at the lower of cost or
market on a first-in, first-out basis in accordance with generally
accepted accounting principles consistently applied, and (ii) saleable
or usable in the ordinary course of business at usual and customary
prices, subject to normal returns and markdowns consistent with past
practice. All accounts receivable of the Company are valid and legally
enforceable obligations of the account parties and are not subject to
any claim of offset or deduction against the Company. At the Closing,
the Sellers will deliver to the Purchaser lists, certified by them to
be complete
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and correct, of all of the inventory and accounts receivable of the
Homes.
3.10. FIXED ASSETS. Schedule 3.10 lists all motor vehicles and
other material items of equipment, fixtures, furniture and other fixed
assets used in the operation of the Homes, all of which are included
in the Assets. All such items are in good and operating con dition and
repair, ordinary wear and tear excepted.
3.11. CONTRACTS AND COMMITMENTS. Schedule 3.11 sets forth a
complete description of:
(i) all documents evidencing any money borrowed by the
Company or the creation or existence of any Lien against any of
the Assets, and all documents relating to any debt secured in
whole or in part by any such Liens;
(ii) all collective bargaining agreements, employment
contracts, noncompetition agreements and other agreements re
lating to the employment of any employees of the Company, or with
any former employees or owners of any of the Homes;
(iii) all joint venture agreements and all other agree ments
involving the sharing of profits, involving the Company or any
Home;
(iv) all (i) contracts or commitments for capital
expenditures for the Company involving obligations aggregating in
excess of $5,000, (ii) leases under which personal property is
leased by the Company and which are not cancelable by either
party thereto without penalty upon notice of 30 days or less or
pursuant to which rentals exceed $1,000 per annum or $5,000 in
the aggregate, or (iii) contracts and agreements of the Company
which do not terminate or are not terminable by the Company upon
notice of 30 days or less or which involves an obligation on its
part in excess of $1,000 per annum or $5,000 in the
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aggregate; and
(v) all other contracts and commitments of the Company
entered into outside the ordinary course of business.
Each contract and other document required to be described in
Schedule 3.11 is valid and in full force and effect and neither the
Company, nor, to the knowledge of the Sellers, none of the other
parties thereto, are in default thereunder. A true and correct copy of
each document listed on Schedule 3.11 has been delivered to the
Purchaser by the Sellers.
3.12. PRE-NEED CONTRACTS AND TRUST ACCOUNTS. Schedule 3.12
accurately lists, as of the date of this Agreement, (i) all preneed
contracts of the Homes unfulfilled as of such date, including
contracts for the sale of funeral merchandise and services, and (ii)
all trust accounts and insurance products funding such preneed con
tracts, indicating the location of each and the balance thereof. All
preneed contracts required to be listed on Schedule 3.12 (x) have been
entered into in the normal course of business at regular retail
prices, or pursuant to a sales promotion program, solely for use by
the named customers and members of their families on terms not more
favorable than shown on the specimen contracts which have been
delivered to the Purchaser, (y) are subject to the rules and regula
tions of the Homes as now in force (copies of which have been
delivered to the Purchaser), and (z) on the date hereof are in full
force and effect, subject to no offsets, claims or waivers, and
neither the Company nor, except as disclosed on Schedule 3.12, such
customer is in default thereunder. All funds received by the Company
under preneed contracts have been deposited in the appropriate
accounts and administered and reported in accordance with the terms
thereof and as required by applicable laws, regulations and procedures
required in the State of New Jersey. The aggregate market value of
such preneed accounts, trusts and
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other deposits is equal to or greater than the aggregate preneed
liability related thereto (liability measured by the actual cost of
providing services and merchandise as of the Closing Date). The
services heretofore provided by the Homes have been rendered in a
professional and compe tent manner consistent with prevailing
professional standards, practices and customs.
3.13. INTANGIBLE RIGHTS. There are no patents, patent
applications, patent licenses, trademarks, trademark applications or
trademark or trademark licenses (collectively, "Intangible Rights")
used in the operation of the Homes, except as described on Schedule
3.13. The Company is not charged with infringement of any Intangible
Rights, nor do the Sellers know of any such infringement, whether or
not claimed by any person.
3.14. INSURANCE AND CLAIMS. The Company maintains such poli cies
of insurance in such amounts, and which insure against such losses and
risks, as are generally maintained for comparable businesses and
properties. Valid policies for such insurance will be outstanding and
duly in force at all times prior to the Closing.
3.15. LICENSES, PERMITS, ETC. Schedule 3.15 lists all licen ses,
franchises, permits, certificates, consents, rights and privi leges
that are necessary or appropriate for the operation of the Homes. All
such items are in full force and effect.
3.16. LITIGATION. There are no claims, actions, suits, pro
ceedings or investigations pending or, to the Sellers' knowledge,
threatened against or affecting the Company or any of the Assets, at
law or in equity or before or by any court or federal, state, munici
pal or other governmental department, commission, board, agency or in
strumentality. The Company is not subject to any continuing court or
administrative order, writ, injunction or decree, nor is the Company
in default with respect to any order, writ, injunction or
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decree issued by any court or foreign, federal, state, municipal or
other governmental department, commission, board, agency or
instrumentality.
3.17. COMPLIANCE WITH LAWS. The Company has operated and is
operating each Home in compliance with all federal, state, municipal
and other statutes, rules, ordinances and regulations applicable to
the operation of the Homes and the Assets (including without limita
tion all environmental protection and occupational safety and health
rules, regulations and laws, and laws and regulations applicable to
preneed contracts and trust accounts, including the so-called "FTC
Funeral Rule").
3.18. ENVIRONMENTAL MATTERS. The following representations and
warranties are made by the Sellers as set forth below, without
qualification, with respect to the ownership and operation of the
Company, its predecessors, the Assets and the Real Property since (i)
October 1, 1986, as to the Red Bank Home, (ii) July 6, 1990, as to the
Eatontown Home, (iii) March 25, 1989, as to the Keyport and Matawan
Homes, and (iv) July 14, 1994 as to the Family Center, and to the best
knowledge of the Sellers with respect to such ownership and operation
prior to such dates (in each case, as applicable):
(a) The Company has complied and is in compliance with all
Environmental Laws (as hereinafter defined).
(b) Without limiting the generality of the foregoing, the Company
has obtained, and has complied and is in compliance with, all permits,
licenses and other authorizations that may be required pursuant to
Environmental Laws for the occupation of the Real Property and the
operation of the business of the Company.
(c) The Company has not received any notice, report or other
information regarding any liabilities (whether accrued, absolute,
contingent,
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unliquidated or otherwise) or investigatory, remedial or corrective
obligations, relating to its business or any of the Real Property
arising under Environmental Laws.
(d) Except as set forth on Schedule 3.18, none of the following
exists on any portion of the Real Property:
(i) Underground storage tanks or surface
impoundments;
(ii) Asbestos-containing material in any form or
condition; or
(iii) Materials or equipment containing polychlorinated
biphenyls.
(e) The Company has treated, stored, disposed of, arranged for or
permitted the disposal of, transported, handled, or Released any
substance, including without limitation any Hazardous Materials, or
owned or operated any facility or property, so as to give rise to lia
bilities for response costs, natural resource damages or attorneys
fees pursuant to the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 ("CERCLA"), as amended, or
similar state Environmental Laws.
(f) Neither this Agreement nor the consummation of the
transaction that is the subject of this Agreement will result in any
obligations for site investigation or cleanup, or notification to or
consent of any governmental authority or third parties, pursuant to
any so-called "transaction-triggered" or "responsible property
transfer" Environmental Laws.
(g) Without limiting the foregoing, no facts, events or
conditions relating to the past or present facilities, properties or
operations of the Company will prevent, hinder or limit continued
compliance with Environmental Laws, give rise to any investigatory,
remedial or
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corrective obligations pursuant to Environmental Laws, or give rise to
any other liabilities (whether accrued absolute, contingent,
unliquidated or otherwise) pursuant to Environmental Laws, including
without limitation any relating to onsite or offsite Releases or
threatened Releases of Hazardous Materials, substances or wastes,
personal injury, property damage or natural resource damage.
(h) The Company's SIC (Standard Industrial Classification) number
as designated in the Standard Classification Manual prepared by the
Office of Management and Budget, is 7261, and the Company does not
constitute an "Industrial Establishment" subject to the requirements
of the Industrial Site Recovery Act (previously known as the
Environmental Cleanup Responsibility Act), N.J.S.A. 13:1K-6 ET SEQ.
("ISRA"), and consummation of the transactions hereunder or pursuant
to the Real Property Agreements and the Lease Agreement shall require
notice to or consent of any person or governmental entity under ISRA.
(i) For purposes of this Section 3.17:
"Environmental Laws" means all laws concerning pollution or
protection of the environment (including without limitation all those
relating to the presence, use, production, generation, handling,
transportation, treatment, storage, disposal, distribution, labeling,
testing, processing, discharge, Release, threatened Release, control
or cleanup of any Hazardous Materials, substances or wastes, chemical
substances or mixtures, pesticides, pollutants, contaminants, toxic
chemicals, petroleum products or byproducts, asbestos, polychlori
nated biphenyls, noise or radiation).
"Hazardous Materials" means any hazardous, toxic, dangerous or
other waste, substance of material defined as such in, regulated by or
for purposes of any Environmental Law.
"Release" has the meaning set forth in CERCLA.
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3.19. EMPLOYEES. Schedule 3.19 correctly and completely lists the
names and annual or hourly rates of salary and other compen sation of
all the employees and agents of the Company. Schedule 3.19 also sets
forth the date of the last salary increase for each employee listed
thereon, and the outstanding balances of all loans and advances made
by the Company to any such employee or agent. There are not pending or
threatened against the Company any general labor disputes, strikes or
concerted work stoppages, and there are no discussions, negotiations,
demands or proposals that are pending or have been conducted or made
with or by any labor union or association with respect to any
employees of the Company. No Seller is aware of the existence of any
serious health condition of any key management personnel of any Home
that might impair any such person's ability to carry on the essential
functions of his or her position into the foreseeable future after the
Closing. The Sellers believe that the relations between the Company
and its employees are good.
3.20. EMPLOYEE BENEFIT PLANS. Schedule 3.20 lists all plans,
contracts, commitments, programs and policies (including, without
limitation, pension, profit sharing, thrift, bonus, deferred
compensation, severance, retirement, disability, medical, life, dental
and accidental insurance, vacation, sick leave, death benefit and
other similar employee benefit plans and policies) providing benefits
to any employee or former employee of the Company (collectively, the
"Plans"). The Sellers have delivered to the Purchaser true and correct
copies of all documents embodying the Plans. All obligations of the
Company under the Plans have been fully paid, fully funded or adequate
accruals therefor have been made on the Company Balance Sheet. All
necessary governmental approvals have been obtained for all Plans
subject to the Employee Retirement Income Security Act of 1974
("ERISA") and have been qualified under Section 401 of the Code, and
each trust established for any Plan is exempt from
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federal income taxation pursuant to Section 501(a) of the Code. With
respect to any such Plan maintained by the Company, there has been no
(i) "reportable event" as defined in Section 4043 of ERISA, (ii) event
described in Section 4062(e) or 4063(a) of ERISA, or (iii) in the case
of any defined benefit plan, termination or partial termination. The
profit sharing plan described on Schedule 3.20 has been established
and maintained in accordance with the applicable disclosure and
reporting requirements of the Internal Revenue Service and the U.S.
Department of Labor, and to the Shareholder's knowledge at the Closing
the Company will have no funding or other obligations thereunder.
3.21. BOOKS AND RECORDS. All books and records of the Company are
true, correct and complete, have been maintained in accor dance with
good business practice and in accordance with all laws, regulations
and other requirements applicable to the Homes.
3.22. FINDERS. Neither Seller is a party to or in any way
obligated under any contract or other agreement, and there are no out
standing claims against any of them, for the payment of any broker's
or finder's fee in connection with the origin, negotiation, execution
or performance of this Agreement.
3.23. AUTHORITY OF THE COMPANY. The execution, delivery and
performance of this Agreement by the Company have been duly authorized
by its Board of Directors. This Agreement is legally binding and
enforceable against the Company in accordance with its terms. Neither
the execution, delivery nor performance of this Agreement by the
Company will result in a violation or breach of, nor constitute a
default or accelerate the performance required under, the Certificate
of Incorporation or bylaws of the Company or any indenture, mortgage,
deed of trust or other contract or agreement to which the Company is a
party or by which it or its properties are
-23-
bound, or violate any order, writ, injunction or decree of any court,
administrative agency or governmental body.
3.24. AUTHORITY OF THE SHAREHOLDER. The Share-holder has full
authority to enter into this Agreement and the Documents (as hereafter
defined) to which he is a party, and to perform his obligations
hereunder and thereunder, and neither the execution, delivery nor
performance by the Shareholder of this Agreement or such Documents
will result in a violation or breach of any term or provision of, nor
constitute a default under, any contract, agreement or other
commitment to which the Shareholder is a party or by which the
Shareholder or the Assets are bound, or violate any order, writ,
injunction or decree of any court, administrative agency or
governmental body. This Agreement is, and such Documents upon their
execution and delivery as herein provided will be, valid and binding
obligations of the Shareholder enforceable against the Shareholder in
accordance with their respective terms. For purposes of this
Agreement, the term "Documents" shall mean, as to any party hereto,
any and all agreements, certificates and other instruments expressly
contemplated in this Agreement or any exhibit hereto to be executed or
delivered by or on behalf of such party at or in connection with the
Closing hereunder.
3.25. FULL DISCLOSURE. The representations and warranties made by
the Sellers hereunder or in any Schedules or certificates furnished to
the Purchaser pursuant hereto do not and will not contain any untrue
statement of a fact or omit to state a fact required to be stated
herein or therein or necessary to make the representations or
warranties herein or therein, in light of the circumstances in which
they are made, not misleading.
3.26. SCHEDULES. The Schedules referred to in this Section 3 have
been prepared as of the date hereof in a separate binder or volume
-24-
contemporaneously with the execution of this Agreement, and have been
signed for identification by the Sellers.
4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. The Purchaser
represents and warrants to and agrees with the Sellers that:
4.1. ORGANIZATION AND EXISTENCE. The Purchaser is a corporation
duly organized, validly existing and in good standing under the laws
of the State of Delaware, and has all requisite corporate power to
enter into and perform its obligations under this Agreement and the
Documents to which it is a party.
4.2. AUTHORITY. The execution, delivery and performance by the
Purchaser of this Agreement and the Documents contemplated in this
Agreement to be executed and delivered by it have been duly autho
rized by its Board of Directors. This Agreement is, and upon their
execution and delivery as herein provided such other Documents will
be, valid and binding upon the Purchaser and enforceable against it in
accordance with their respective terms. Neither the execution,
delivery or performance by the Purchaser of this Agreement or any such
other document will conflict with or result in a violation or breach
of any term or provision of, nor constitute a default under, the
Certificate of Incorporation or Bylaws of the Purchaser, or under any
indenture, mortgage, deed of trust or other contract or agreement to
which the Purchaser is a party or by which it or its properties are
bound, except for such contracts and commitments for which all
necessary consents will have been duly and validly obtained by the
time of Closing, or violate any order, writ, injunction or decree of
any court, administrative agency or governmental body.
4.3. FINDERS. Except as described in Section 13.1, the Purchaser
is not a party to or in any way obligated under any contract or other
agreement, and there are no outstanding claims against it, for the
payment of any broker's or finder's fee in
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connection with the origin, negotiation, execution or performance of
this Agreement.
4.4. FULL DISCLOSURE. The representations and warranties made by
the Purchaser hereunder or in any certificates furnished to the
Sellers pursuant hereto do not and will not contain any untrue
statement of a material fact or omit to state a material fact required
to be stated herein or therein or necessary to make the
representations or warranties herein or therein, in light of the
circumstances in which they are made, not misleading.
5. COVENANTS OF THE SELLERS PENDING CLOSING. The Sellers jointly and
severally covenant with the Purchaser that:
5.1. CONDUCT OF BUSINESS. From the date of this Agreement to the
Closing Date, each Home will be operated only in the ordinary course,
and, in particular, without the prior written consent of the
Purchaser, the Company will not (and the Shareholder will not cause or
permit the Company to):
(i) cancel or permit any insurance to lapse or termi
nate, unless renewed or replaced by like coverage;
(ii) commit any act or permit the occurrence of any
event or the existence of any condition of the type described in
Section 3.5;
(iii) enter into any contract, agreement or other com
mitment of the type described in Section 3.10;
(iv) hire, fire, reassign or make any other change in key
personnel of the Company, or increase the rate of compensation of
or declare or pay any bonuses to any employee in excess of that
listed on Schedule 3.19; or
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(v) take any other action which would cause any of the
representations and warranties made in Section 3 hereof not to be
true and correct in all material respects on and as of the
Closing Date with the same force and effect as if the same had
been made on and as of the Closing Date.
5.2. ACCESS TO INFORMATION. Prior to Closing, the Sellers will
give to the Purchaser and its counsel, accountants and other represen
tatives, full and free access to all of the properties, books, con
tracts, commitments and records of the Company so that the Purchaser
may have full opportunity to make such investigation as it shall de
sire to make of the Homes and the affairs of the Company and the
Assets.
5.3. CONSENTS AND APPROVALS. The Sellers will use their best
efforts to obtain the necessary consents and approvals of other per
sons which may be required to be obtained on their part to consummate
the transactions contemplated by this Agreement.
5.4. NO SHOP. For so long as this Agreement remains in effect,
the Sellers agree that they shall not enter into any agreements or
commitments, or initiate, solicit or encourage any offers, proposals
or expressions of interest, or otherwise hold any discussions with any
potential buyers, investment bankers or finders, with respect to the
possible sale or other disposition of all or any substantial portion
of the Assets, the sale of all or a controlling interest in the stock
of the Company, or the merger or consolidation of the Company, other
than with the Purchaser. If, during such period, any Seller receives
an inquiry or expression of interest regarding any such transaction,
the Sellers shall promptly notify the Purchaser of such fact; provided
that the foregoing shall not require that the source of such
expression of interest be disclosed.
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6. COVENANTS OF THE PURCHASER PENDING CLOSING. The Purchaser cove
nants with the Sellers that:
6.1. CONSENTS AND APPROVALS. The Purchaser will use its best
efforts to obtain the necessary consents and approvals of other
persons which may be required to be obtained on its part to consum
mate the transactions contemplated in this Agreement.
6.2. CONFIDENTIALITY. Prior to the Closing, the Purchaser and its
representatives will hold in confidence any data and information
obtained with respect to the Homes from any representative or employee
of the Company, including the accountants or legal counsel of the
Sellers, or from any books or records of any of them, in connection
with the transactions contemplated by this Agreement. If the
transactions contemplated hereby are not consummated, none of the
Purchaser nor its representatives shall use such data or information
or disclose the same to others, except as such data or information is
published or is a matter of public knowledge or is required by an
applicable law or regulation to be disclosed. If this Agreement is
terminated for any reason, all written data and information obtained
by the Purchaser from the Sellers or their representatives in con
nection with the transactions contemplated by this Agreement shall be
returned to the Sellers.
7. CONDITIONS TO OBLIGATIONS OF THE PURCHASER. The obligations of the
Purchaser under this Agreement shall be subject to the following condi
tions, any of which may be expressly waived by it in writing:
7.1. REPRESENTATIONS AND WARRANTIES TRUE; COVENANTS PERFORMED.
The Purchaser shall not have discovered any material error,
misstatement or omission in the representations and warranties made by
the Sellers in Section 3 hereof; the representations and warranties
made by the Sellers herein shall be deemed to have been made again at
and as of the time of Closing and shall then be true and correct; the
Sellers shall have performed and complied
-28-
with all agreements and conditions required by this Agreement to be
performed or complied with by them at or prior to the Closing; and the
Purchaser shall have received a certificate, signed by the Shareholder
and the President of the Company, to the effect of the foregoing
provisions of this Section 7.1.
7.2. OPINION OF COUNSEL. The Sellers shall have caused to be
delivered to the Purchaser an opinion of Schanker and ▇▇▇▇▇▇▇▇, coun
sel for the Sellers, dated the Closing Date, to the effect that:
(i) the Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of New
Jersey, with full corporate authority to enter into and perform
its obligations under this Agreement; and CAT is a general
partnership duly organized and existing under the laws of the
State of New Jersey
(ii) the execution, delivery and performance of this
Agreement by the Company have been duly authorized by all
necessary corporate action required on the part of the Company;
(iii) this Agreement and the Documents to which the Sellers
are parties have been duly and validly executed and delivered by
the Sellers and constitute the valid and binding obligations of
the Sellers enforceable against them in accordance with their
respective terms; the Lease Agreement has been duly and validly
executed and delivered by CAT and constitutes the valid and
binding obligation of CAT enforceable against it in accordance
with its terms; and the Redemption Agreement (including, without
limitation, the non-competition provisions attached as Exhibit
"A" thereto) was duly executed and delivered by ▇▇▇▇▇▇▇ and
constitutes the valid and binding obligation
-29-
of ▇▇▇▇▇▇▇ enforceable against him in accordance with its terms;
(iv) neither the execution, delivery or consummation of
the transactions contemplated by this Agreement or the Documents
to which the Sellers are parties will (x) result in the breach of
or constitute a default under the Certificate of Incorporation or
bylaws of the Company, or under any loan or credit agreement,
indenture, mortgage, deed of trust or other contract or agreement
known to such counsel and to which any Seller is a party or by
which the Sellers or the Assets are bound, or (y) violate any
order, writ, injunction or decree known to such counsel of any
court, administrative agency or governmental body;
(v) no authorization, approval or consent of or declaration
or filing with any governmental authority or regulatory body,
federal, state or local, is necessary or required in connection
with the execution and delivery by the Sellers of this Agreement
or the Documents to which they are parties, or the performance of
their obligations hereunder or thereunder; and
(vi) to the knowledge of such counsel after due inquiry,
there are no claims, actions, suits, proceedings or investiga
tions pending or threatened against or affecting the Company or
any of the Assets, at law or in equity or before or by any court
or federal, stated, municipal or other governmental department,
commission, board, agency or instrumentality.
Such opinion may, as to matters of fact, be given in reliance upon
certificates of the Shareholder and officers of the Company, copies of
which shall be provided to Purchaser at Closing. Any opinion as to the
enforceability of any document may be limited by bankruptcy,
insolvency, reorganization,
-30-
moratorium and similar laws affecting creditors' rights and by
principles of equity. Such opinion may be limited to federal law and
the internal laws of the State of New Jersey.
7.3. CONSENTS AND APPROVALS. The Sellers shall have obtained all
consents and approvals of other persons and governmental authorities
to the transactions contemplated by this Agreement.
7.4. NO LOSS OR DAMAGE. Prior to the Closing there shall not have
occurred any loss or damage to any substantial portion of the Assets,
regardless of whether such loss or damage was insured.
7.5. APPROVAL BY COUNSEL. All actions, proceedings, instruments
and documents required to carry out the transactions contemplated by
this Agreement or incidental thereto and all other related legal
matters shall have been approved by counsel for the Purchaser, and
such counsel shall have been furnished with such certified copies of
actions and proceedings and other instruments and documents as they
shall have reasonably requested.
7.6. PRE-ACQUISITION REVIEW. The Purchaser and its repre
sentatives shall have completed a pre-acquisition review of the
financial information, books and records, and Assets of the Homes and
shall have discovered no change in the business, Assets, operations,
financial condition or prospects of the Homes which could, in the sole
determination of the Purchaser, have an adverse effect on the value to
the Purchaser of the business, Assets, financial condition or
prospects being acquired hereunder.
7.7. RELATED TRANSACTIONS. Each of ▇▇▇▇▇▇▇, ▇▇▇ and ▇▇▇▇ shall
have executed and delivered to the Purchaser his respective Employment
Agreement; CAT shall have executed and delivered the Lease Agreement;
and the closings under the Real Property Agreements shall have
occurred substantially simultaneously with the Closing hereunder.
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7.8. ENVIRONMENTAL, OSHA AND STRUCTURAL REPORTS. There shall have
been conducted, at the Purchaser's expense, (i) a Phase I (and, if
deemed necessary by Purchaser, a Phase II) environmental audit of each
Home and the Real Property by an environmental consulting firm
selected by Purchaser (or, in lieu thereof, in the Purchaser's sole
discretion, an environmental questionnaire, on forms provided by the
Purchaser, shall have been completed by the manager of the Homes and
delivered to the Purchaser), (ii) a health and safety inspection of
each Home by a person (who may be an employee of the Purchaser) or
firm selected by the Purchaser and who is qualified and experienced in
such matters in the funeral service industry, and (iii) a structural
inspection of each Home by an engineering firm selected by the
Purchaser. In any event, it shall be a condition to the Purchaser's
obligations hereunder that the results of the reports of such firms or
persons (together with any remedial action taken by Sellers,
regardless of the cost, in response thereto) shall be satisfactory to
Purchaser in its sole discretion. Without limiting the generality of
the foregoing, the underground storage tanks located at the Eatontown
and Matawan Homes as described on Schedule 3.18 shall be tested at the
Purchaser's expense for soil contamination by an environmental
consulting firm reasonably acceptable to the Purchaser. The
underground storage tanks at the Keyport Home, which the Sellers
represent are no longer in use, shall be removed following the Closing
as described in Section 10.5.
7.9. ZONING. The Purchaser shall have received a letter or other
acceptable form of communication from a responsible officer of each
municipality or other governmental authority having jurisdiction over
any zoning ordinance or regulation of each Home, indicating the zoning
classification for each parcel on which it is located, affirmatively
stating that the use thereof as a funeral home complies with such
classification, and setting forth (if applicable) the number of
parking spaces required for each such parcel under such ordinance or
regulation.
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7.10. LIEN RELEASES. The holders of any Liens against any of the
Assets (other than Permitted Encumbrances against the Family Center
Tract) or against any of the Real Property covered by the Lease
Agreement (other than the Assumed Mortgage referred to therein) shall
have executed and delivered written releases of such Liens, all in
recordable form and otherwise acceptable to the Purchaser. In
addition, the Mortgagee (as defined in the Lease Agreement) shall have
entered into a subordination, non-disturbance and attornment agreement
with the Purchaser with respect to such Real Property, in form and
substance acceptable to them.
7.11. OTHER MANAGEMENT ARRANGEMENTS. The Sellers shall have
identified to the Purchaser such personnel of the Homes (in addition
to those persons covered by the Employment Agreements) as may be key
to the continued effective management and operation of the Homes after
the Closing, and the Purchaser shall have entered into mutually
satisfactory arrangements regarding the continued employment of such
personnel at the Homes following the Closing.
7.12. APPROVED BUDGET. The Purchaser, the Shareholder and the
Manager of each Home shall have reached agreement regarding the
proposed Operating Budget for the Homes for the current fiscal year of
the Purchaser and for the next succeeding fiscal year; and the
Purchaser shall have received from the Shareholder and such Managers
their certificate, acceptable in form and substance to the Purchaser,
setting forth their acknowledgement regarding such Budget and each
such Manager's agreement to utilize his best efforts to achieve the
results therein contained.
7.13. RELIANCE LETTERS. The Purchaser shall have received a
letter or other written instrument acceptable in form and substance to
the Purchaser from ▇▇▇▇▇ & Co., LLC, pursuant to which such firm
permits the Purchaser to rely upon its
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review reports referred to in Section 3.3 and waives any requirement
or defense of privity in connection therewith.
7.14. TITLE INSURANCE. The Purchaser shall have received Owner's
(with respect to the Family Center Tract) and Leasehold (with respect
to the Lease Agreement Real Property) Policies of Title Insurance
issued to the Purchaser in agreed-upon amounts, issued by Commonwealth
Land Title Company or another title company mutually designed by the
parties (the "Title Company"), insuring Purchaser's interests therein,
subject only to the Permitted Encumbrances and any standard printed
exceptions included in a New Jersey standard form Policy of Title
Insurance; provided, however, that such policies shall have deleted
any exception regarding restrictions or be limited to restrictions
that are Permitted Encumbrances, any standard exception pertaining to
discrepancies, conflicts or shortages in area shall be deleted except
for "shortages in area", and any standard exception for taxes shall be
limited to subsequent years. All premiums, escrow fees and other costs
associated with the issuance of such policies shall be borne by the
Purchaser.
7.15. SURVEY. The Purchaser shall have received an ALTA/ACSM
survey prepared by a licensed surveyor approved by the Purchaser and
acceptable to the Title Company, with respect to the Family Center
Tract and the Lease Agreement Real Property, which surveys shall
comply with any applicable standards under New Jersey law, be
sufficient for Title Company to delete any survey exception contained
in the owner's policy of title insurance referred to in Sec tion 7.14,
and otherwise be in form and content acceptable to Purchaser. All fees
and costs associated with the issuance and finalization of such
surveys shall be borne by the Purchaser.
8. CONDITIONS TO OBLIGATIONS OF THE SELLERS. The obligations of the
Sellers under this Agreement shall be subject to the following conditions,
any of which may be
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expressly waived by the Sellers in writing:
8.1. REPRESENTATIONS AND WARRANTIES TRUE; COVENANTS PERFORMED.
The Sellers shall not have discovered any material error, mis
statement or omission in the representations and warranties made by
the Purchaser in Section 4 hereof; the representations and warranties
made by the Purchaser herein shall be deemed to have been made again
at and as of the time of Closing and shall then be true and correct;
the Purchaser shall have performed and complied with all agreements
and conditions required by this Agreement to be performed or complied
with by it at or prior to the Closing; and the Sellers shall have
received a certificate, signed by an executive officer of the
Purchaser, to the effect of the foregoing provisions of this Section
8.1.
8.2. OPINION OF COUNSEL. The Purchaser shall have caused to be
delivered to the Sellers an opinion of ▇▇▇▇▇ & ▇▇▇▇▇, A Professional
Corporation, counsel for Purchaser to the effect that:
(i) the Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware, and the Purchaser has all requisite corporate power to
enter into and perform its obligations under this Agreement and
the Documents to which it is a party;
(ii) the execution, delivery and performance by the
Purchaser of this Agreement and the Documents to which it is a
party have been duly authorized by its Boards of Directors;
(iii) this Agreement is, and upon execution and delivery as
herein provided the Documents to which the Purchaser is a party
will be, valid and binding upon the Purchaser and enforceable
against the Purchaser in accordance with their respective terms;
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(iv) neither the execution, delivery or performance by the
Purchaser of this Agreement or the Documents to which it is a
party will conflict with or result in a violation or breach of
any term or provision of, nor constitute a default under, the
Certificate of Incorporation or bylaws of the Purchaser or under
any loan or credit agreement, indenture, mortgage, deed of trust
or other contract or agreement known to such counsel and to which
the Purchaser is a party or by which the Purchaser or its
property is bound, or violate any order, writ, injunction or
decree known to such counsel and of any court, administrative
agency or governmental body; and
(v) no authorization, approval or consent of or
declaration or filing with any governmental authority or
regulatory body, federal, state or local, is necessary or
required in connection with the execution and delivery by the
Purchaser of this Agreement or the Documents to which the
Purchaser is a party or the performance of its obligations
hereunder or thereunder.
Such opinion may, as to matters of fact, be given in reliance upon
certificates of officers of the Purchaser and certificates of public
officials, copies of which shall be provided to Sellers at Closing.
Any opinion as to the enforceability of any document may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors rights and by principles of equity. Such
opinion may be limited to federal law, the General Corporation Law of
the State of Delaware and the internal laws of the State of Texas.
8.3. CONSENTS AND APPROVALS. The Purchaser shall have obtained
all consents and approvals of other persons and governmental
authorities to the transactions contemplated by this Agreement.
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8.4. RELATED TRANSACTIONS. The Purchaser shall have executed and
delivered to each of ▇▇▇▇▇▇▇, ▇▇▇ and Drew his respective Employment
Agreement, and to CAT the Lease Agreement; and the closings under the
Real Property Agreements shall have occurred substantially
simultaneously with the Closing hereunder.
9. NATURE AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
9.1. NATURE OF STATEMENTS. All statements contained in this
Agreement or any Schedule or Exhibit hereto shall be deemed
representations and warranties of the party executing or delivering
the same.
9.2. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Regardless of
any investigation made at any time by or on behalf of any party
hereto, all covenants, agreements, representations and warranties made
hereunder or pursuant hereto or any Schedule or Exhibit hereto or in
connection with the transactions contemplated hereby and thereby shall
not terminate but shall survive the Closing and con tinue in effect
thereafter.
10. INDEMNIFICATION.
10.1. INDEMNIFICATION BY THE SELLERS. The Sellers jointly and
severally agree to indemnify and hold harmless the Purchaser and its
successors and assigns from and against any and all losses, damages,
liabilities, obligations, costs or expenses (any one such item being
herein called a "Loss" and all such items being herein collectively
called "Losses") which are caused by or arise out of (i) any breach or
default in the performance by any Seller of any cove nant or agreement
of the Sellers contained in this Agreement, (ii) any breach of
warranty or inaccurate or erroneous representation made by the Sellers
herein, in any Schedule delivered to the Purchaser pursuant hereto or
in any certificate or other instrument delivered by or on behalf of
the Sellers pursuant hereto,
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(iii) any claim made against the Purchaser in respect of any of the
Unassumed Liabilities, and (iv) any and all actions, suits,
proceedings, claims, demands, judgments, costs and expenses (including
reasonable legal fees) incident to any of the foregoing.
10.2. INDEMNIFICATION BY THE PURCHASER. The Purchaser agrees to
indemnify and hold harmless the Sellers and their heirs, successors
and assigns from and against any Losses which are caused by or arise
out of (i) any breach or default in the performance by the Purchaser
of any covenant or agreement of the Purchaser contained in this
Agreement, (ii) any breach of warranty or inaccurate or erroneous
representation made by the Purchaser herein or in any certificate or
other instrument delivered by or on behalf of the Purchaser pursuant
hereto, (iii) any claim made against the Sellers in respect of the
Assumed Liabilities, and (iv) any and all actions suits, proceedings,
claims, demands, judgments, costs and expenses (including reasonable
legal fees) incident to any of the foregoing.
10.3. THIRD PARTY CLAIMS. If any third person asserts a claim
against an indemnified party hereunder that, if successful, might
result in a claim for indemnification against an indemnifying party
hereunder, the indemnifying party shall be given prompt written notice
thereof and shall have the right (i) to participate in the defense
thereof and be represented, at his or its own expense, by advisory
counsel selected by him or it, and (ii) to approve any settlement if
the indemnifying party is, or will be, required to pay any amounts in
connection therewith. Notwithstanding the foregoing, if within ten
business days after delivery of the indemnified party's notice
described above, the indemnifying party indicates in writing to the
indemnified party that, as between such parties, such claims shall be
fully indemnified for by the indemnifying party as provided herein,
then the indemnifying party shall have the right to control the
defense of such
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claim, provided that the indemnified party shall have the right (i) to
participate in the defense thereof and be repre sented, at his or its
own expenses, by advisory counsel selected by him or it, and (ii) to
approve any settlement if the indemnified party's interests are, or
would be, affected thereby.
10.4. OFFSET. If any Seller becomes obligated to indemnify the
Purchaser after the Closing Date pursuant to this Agreement, at any
time when any Deferred Purchase Price remains payable, then the
Purchaser may, at its option and without prejudice to any right of the
Purchaser to proceed directly against any Seller, set-off the amount
for which any such Seller shall be so obligated against the Deferred
Purchase Price, provided that at the time of offset the Purchaser
shall have accumulated Losses of at least $10,000.00 (it being
understood, however, that the Purchaser shall be entitled to recover
all Losses, including the first $10,000.00). The exercise of such
right of set-off shall be evidenced by means of a written notice to
such effect given by the Purchaser to the Sellers, describing the
basis for indemnity and set-off hereunder and the amount of the
set-off.
10.5. UST REMOVAL. Promptly following the Closing, the (i) the
Purchaser, at its sole cost and expense, shall have the underground
storage tanks at the Matawan and Eatontown Homes (collectively, the
AMatawan and Eatontown Tanks@) tested for soil contamination, and
shall cause the inactive underground storage tanks located at the
Keyport Home as described on Schedule 3.18 (the "Keyport Tanks") to be
removed by a reputable and competent contractor, and the Purchaser
shall, at its sole cost and expense, cause the surrounding soil to be
tested for any contamination resulting from the use, operation or
presence of the Keyport Tanks; and (ii) if the results of such testing
shall reveal the presence of soil or ground water contamination or any
other violation of applicable law, then the Sellers shall, on a
cost-sharing basis as hereafter described, cause such soil to be
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remediated and disposed of in a manner complying with all federal,
state and local legal requirements, or such other action required for
the site to comply with applicable law, and otherwise reasonably
satisfactory to the Purchaser, in which case the Sellers shall file
all necessary reports and other materials with all regulatory agencies
having jurisdiction over such matter, with respect to such removal and
remediation and shall furnish the Purchaser with written evidence of
all of the foregoing as it shall have reasonably requested. In
addition to the "Losses" for which the Purchaser shall be indemnified
against as provided in Section 10.1, the Sellers jointly and severally
agree to indemnify the Purchaser for any Losses arising from the
Matawan and Eatontown Tanks and the Keyport Tanks, including any
remediation, cleanup or other related costs and expenses, as well as
liability, fines and penalties to governmental agencies and third
parties; provided, however, that (after giving effect to any proceeds
received and applied against such liability, costs and expenses from
insurance maintained by the Sellers), the first $25,000.00 shall be
the Sellers' responsibility, the Purchaser shall bear the next
$50,000.00 of such expenses, and the Sellers shall be responsible for
all such costs, expenses and liability in excess of $75,000.00. As
additional security for such indemnification, at the Closing the
Purchaser shall withhold from the Purchase Price the sum of
$100,000.00 (the "Withheld Amount"). If the Purchaser completes (i)
above and (ii) above does not apply, then the Purchaser shall promptly
remit the Withheld Amount to the Company. If (ii) does apply and the
conditions therein described have not been fully satisfied within 120
days after the Purchaser's completion of (i) above, then the Purchaser
shall have the right (but not the obligation) to assume control over
such matters described in (ii) above as shall then not be complete,
all on a cost-sharing basis as described above and without relieving
the Sellers of their responsibility in that regard. The Purchaser
shall have the right to apply the Withheld Amount toward any such
expenses incurred pursuant to the
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preceding sentence, or for any other Losses for which it is entitled
to indemnification under this Section 10.5. Once all of the conditions
set forth in clause (ii) have been satisfied without any further
liability or other "Losses" outstanding (or any and all such Losses
have been paid by the Sellers), any remaining Withheld Amount shall
then be disbursed to the Company.
11. TERMINATION.
11.1. BEST EFFORTS TO SATISFY CONDITIONS. The Sellers agree to
use their best efforts to bring about the satisfaction of the
conditions specified in Section 7 hereof, and the Purchaser agrees to
use its best efforts to bring about the satisfaction of the condi
tions specified in Section 8 hereof.
11.2. TERMINATION. This Agreement may be terminated prior
to Closing by:
(a) the mutual written consent of the Sellers and the
Purchaser;
(b) the Purchaser if a material default shall be made by any
Seller in the observance or in the due and timely per formance by
any of the Sellers' covenants herein contained, or if there shall
have been a material breach or misrepresentation by any Seller of
any of the Sellers' warranties and representa tions herein
contained, or if the conditions of this Agreement to be complied
with or performed by the Sellers at or before the Closing shall
not have been complied with or performed at the time required for
such compliance or performance and such non compliance or
nonperformance shall not have been expressly waived by the
Purchaser in writing;
(c) the Sellers if a material default shall be made by the
Purchaser in the observance or in the due and timely performance
by the Purchaser of any of the covenants of the
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Purchaser herein contained, or if there shall have been a
material breach or mis representation by the Purchaser of any of
its warranties and representations herein contained, or if the
conditions of this Agreement to be complied with or performed by
the Purchaser at or before the Closing shall not have been
complied with or per formed at the time required for such
compliance or performance and such noncompliance or
nonperformance shall not have been expressly waived by the
Sellers in writing; or
(d) either the Sellers or the Purchaser, if the Closing has
not occurred by November 30, 1997.
11.3. LIABILITY UPON TERMINATION. If this Agreement is terminated
under paragraph (a) or (d) of Section 11.2, then no party shall have
any liability to any other party hereunder. If this Agreement is
terminated under paragraph (b) or (c) of Section 11.2, then (i) the
party so terminating this Agreement shall not have any liability to
any other party hereto, provided the terminating party has not
breached any representation or warranty or failed to comply with any
of its covenants in this Agreement, and (ii) such termi nation shall
not prejudice the rights and remedies of the terminating party against
any other party which has breached any of its representations,
warranties or covenants herein prior to such termination.
12. POST-CLOSING COVENANTS.
12.1. RESTRICTIVE COVENANTS.
(a) NON-COMPETITION. If the Closing occurs, ▇▇▇▇▇▇▇ agrees
that he shall not, and by her execution hereof ▇▇▇▇▇▇▇' spouse
(▇▇▇▇▇▇▇, together with his spouse, being herein collectively
referred to as the "Covenantors") agrees that she shall not,
directly or indirectly, for a period commencing on the Closing
Date and ending ten
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(10) years thereafter, do any of the following:
(i) engage, as principal, agent, trustee or through
the agency of any corporation, partnership, association or
agent or agency, anywhere within a 25-mile radius of any
Home (the "Territory"), in the funeral, mortuary, crematory,
monument, or any related line of business (collectively, the
"Business");
(ii) own or hold any beneficial interest in one
percent (1%) or more of the voting securities in any
corporation, partnership or other business entity which con
ducts its operations, in whole or in part, in the Business
within the Territory;
(iii) become an employee of or consultant to, or
otherwise serve in any similar capacity with, any corpora
tion, partnership or other business entity that conducts its
business, in whole or in part, in the Business within the
Territory; or
(iv) cause or induce any present or future employee of
the Purchaser or any of its affiliates to leave the employ
of the Purchaser or any such affiliate to accept employment
with such Covenantor or with any person, firm, association
or corporation with which such Covenantor may be or become
affiliated.
Without limiting the generality of the foregoing, a
Covenantor shall be deemed directly or indirectly engaged in the
Business if he or she acts as a funeral director at any funeral
establishment within the Territory, if such Covenantor engages in
the sale or
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marketing of preneed funeral contracts for services to be
performed within the Territory, or if such Covenantor promotes or
finances any family member or affiliate to operate a Business or
engage in any of the foregoing activities within the Territory.
(b) REFORMATION. The above covenants shall not be held
invalid or unenforceable because of the scope of the territory or
actions subject thereto or restricted thereby, or the period of
time within which such covenants are operative; but any judg ment
of a court of competent jurisdiction may define the maximum
territory and actions subject to and restricted thereby and the
period of time during which such covenants are enforceable.
(c) REMEDIES. The Covenantors agree that any remedy at law
for any actual or threatened breach of any of the foregoing
covenants would be inadequate and that the Purchaser shall be
entitled to specific performance hereof or injunctive relief or
both, by temporary or permanent injunction or such other appro
priate judicial remedy, writ or order as may be entered into by a
court of competent jurisdiction in addition to any damages that
the Purchaser may be legally entitled to recover together with
reasonable expenses of litigation, including attorneys' fees
incurred in connection therewith, as may be approved by such
court.
(d) REPRESENTATIONS. Each Covenantor represents and warrants
to and agrees with the Purchaser that (i) such Covenantor
understands that the foregoing restrictions are being made
incident to and as a condition of the purchase and sale of the
Assets hereunder, and that such covenants are necessary in order
to protect the business and goodwill being acquired thereby, (ii)
such covenants are not oppressive to such Covenantor in any
respect, and (iii) the consideration for such
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restrictions is included in the Purchase Price, which
consideration such Covenantor acknowledges is fair and adequate
for the giving of the covenants herein and for which such
Covenantor acknowledges a direct and valuable benefit.
(e) PURCHASE PRICE ALLOCATION. The parties agree to allocate
$50,000 of the Purchase Price to the foregoing covenants for
federal income tax purposes. Such allocation is not intended to
be a measure of the amount or range of damages which the
Purchaser may suffer or recover as a result of any breach of the
foregoing covenants, and the Covenantors acknowledge that in case
of any such breach, the Purchaser shall be entitled to seek in
excess of such amount as it may otherwise be able to demonstrate
itself justly entitled to.
12.2. CHANGE OF NAME. Promptly following the Closing (but in no
event later than 30 days thereafter), the Sellers shall cause the
Articles of Incorporation of the Company to be amended so as to change
its name to one wholly dissimilar to "▇▇▇▇▇ Funeral Group" or its
equivalent, and will furnish the Purchaser with written evidence of
such amendment.
12.3. TERMINATION OF PROFIT SHARING PLAN. The parties agree that
the Profit Sharing Plan described on Schedule 3.20 (the "Profit
Sharing Plan") shall not be included as part of the Assets, the
Purchaser shall not be substituted as the sponsoring employer under
the Profit Sharing Plan, and the Assumed Liabilities shall in no event
include any withdrawal, termination, unfunded or underfunded liability
arising in connection with the Profit Sharing Plan. Following the
Closing, the Sellers shall take all necessary action to terminate the
Profit Sharing Plan in accordance with applicable law, in connection
with which the Sellers shall file all necessary forms and pay all
appropriate fees, fines, penalties and other sums due in respect
thereof. Without limiting the
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generality of Section 10.1, the "Losses" against which the Purchaser
shall be indemnified against shall include all such liabilities,
obligations and responsibilities arising in connection with the Profit
Sharing Plan, whether arising before or after the Closing, and
(regardless of any limitation set forth in the last sentence of
Section 3.20) whether or not known to the Sellers at the time of
Closing.
13. MISCELLANEOUS.
13.1. EXPENSES. Regardless of whether the Closing occurs, the
parties shall each pay their own expenses in connection with the
negotiation, preparation and carrying out of this Agreement and the
consummation of the transactions contemplated herein. Without limiting
the generality of the foregoing, all finders' and similar fees and
expenses of Success Plan shall be borne solely by the Purchaser, and
in no event shall the Sellers be charged or responsible therefor.
13.2. BULK SALES LAWS. The transactions contemplated by this
Agreement shall be consummated without compliance with the bulk sales
laws of any state. If by reason of any applicable bulk sales law any
claims are asserted by creditors of the Company, such claims shall be
the responsibility of the Purchaser in the case of claims arising
under any of the Assumed Liabilities, or the responsibility of the
Sellers in the case of claims arising under any other liabilities of
the Company.
13.3. NOTICES. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed to
have been given on the date personally delivered, three business days
following the date mailed, first class, registered or certified mail,
postage prepaid, or when sent by telex or telecopy and receipt is
confirmed, as follows:
(i) if to any Seller, to:
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▇▇▇▇▇ Funeral Group, Inc.
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
with a copy to:
Schanker and ▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
(ii) if to the Purchaser, to:
Carriage Funeral Holdings, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: President
with a copy to:
▇▇▇▇▇ & ▇▇▇▇▇,
A Professional Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Mr. W. ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
or to such other address as shall be given in writing by any party to
the other parties hereto.
13.4. ASSIGNMENT. This Agreement may not be assigned by any party
hereto without the prior written consent of the other parties,
provided, however, that following the Closing the Purchaser may assign
its rights hereunder without the consent of the Sellers to a
successor-in-interest to the Purchaser (whether by merger, sale of
assets or otherwise). Nothing in this Agreement, express or implied,
is intended to confer upon any person, other than the parties to this
Agreement and their successors and permitted assigns, any rights or
remedies under or by reason of this Agreement.
13.5. SUCCESSORS BOUND. Subject to the provisions of Section
13.4, this Agreement shall be
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binding upon and inure to the benefit of the parties hereto and their
respective successors, assigns, heirs and personal representatives.
13.6. SHAREHOLDER CONSENT. The Shareholder, in his capacity as
the sole shareholder of the Company, hereby (i) consents to the sale
of the Assets hereunder pursuant to New Jersey Revised Statutes
Tit.14A, c.10, '11, and (ii) irrevocably and unconditionally waives
all dissenters' and other similar rights with respect to the sale of
the Assets under and pursuant to New Jersey Revised Statutes Tit.14A,
c.11, "1,2.
13.7. SECTION AND PARAGRAPH HEADINGS. The section and paragraph
headings in this Agreement are for reference purposes only and shall
not affect the meaning or interpretation of this Agreement.
13.8. AMENDMENT. This Agreement may be amended only by an
instrument in writing executed by both parties hereto.
13.9. ENTIRE AGREEMENT. This Agreement and the Exhibits,
Schedules, certificates and other documents referred to herein con
stitute the entire agreement of the parties hereto, and supersede all
prior understandings with respect to the subject matter hereof and
thereof.
13.10. GOVERNING LAW. This Agreement shall be construed and
enforced under and in accordance with and governed by the law of the
State of New Jersey.
13.11. CONSTRUCTION. As the context requires or permits: pronouns
used herein shall include the masculine, the feminine and neuter;
terms used in plural shall include the singular, and singular terms
shall include the plural; "hereof", "herein", "hereunder" and "hereto"
shall refer to this Agreement; and section and paragraph references,
when not expressly referring to another agreement or document, shall
mean sections or paragraphs in this Agreement.
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13.12. COUNTERPARTS. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of
which shall constitute the same instrument.
13.13 PUBLICITY. The parties agree to (i) maintain the
confidentiality of the commercial terms of the transactions under this
Agreement, including the amount of the Purchase Price, and (ii)
coordinate with one another regarding any press releases or other
public announcements of the consummation of such transactions.
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IN WITNESS WHEREOF, this Agreement has been executed and
delivered as of the date first above written.
THE PURCHASER:
CARRIAGE FUNERAL HOLDINGS, INC.
By:_______________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇, President
THE COMPANY:
▇▇▇▇▇ FUNERAL GROUP, INC.
By:_______________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
THE SHAREHOLDER:
__________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
CARRIAGE SERVICES, INC., a Delaware corporation and the Purchaser's
parent corporation, hereby joins in the execution of this Agreement to evidence
its unconditional and irrevocable guaranty of the obligations of the Purchaser
to pay Deferred Purchase Price pursuant to Section 1.3 hereof.
CARRIAGE SERVICES, INC.
By:_______________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇, President
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The undersigned spouse of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ hereby joins in the
execution of this Agreement in order to evidence her agreement to be bound by
the provisions of Section 12.2 hereof.
____________________________________
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, spouse of
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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EXHIBIT DESCRIPTION
A-1 Employment Agreement (▇▇▇▇▇▇▇ ▇▇▇▇▇)
A-2 Employment Agreement (▇▇▇ ▇▇▇▇▇)
A-3 Employment Agreement (▇▇▇▇ ▇▇▇▇▇)
B Lease Agreement
SCHEDULES DESCRIPTION
1.2 Retained Assets
3.5 Family Center Tract
3.10 Fixed Assets
3.11 Contracts and Commitments
3.12 Preneed Contracts and Trust Accounts
3.13 Intangible Assets
3.15 Licenses, Permits, Etc.
3.18 Environmental Matters
3.19 Employees
3.20 Employee Benefit Plans
10.6 Building Repairs
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