EXHIBIT 10.4
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (the "AGREEMENT") is entered into as of
September 23, 2002 by and among Texas Sterling Construction, LP, a Texas limited
partnership ("BUYER"), and Xxxxxx Industries, Inc., a Texas corporation
("XXXXXX"), Tracks of Texas, Inc., a Texas corporation ("TRACKS OF TEXAS", and
collectively with Xxxxxx referred to herein as "SELLERS"). Buyer and Sellers are
collectively referred to herein as the "PARTIES."
WHEREAS, Xxxxxx is engaged in the business of providing heavy highway
construction and related services in and near the vicinity of Xxxxxx County,
Texas ("SELLERS' BUSINESS" or "BUSINESS"), and Tracks of Texas leases certain
tangible personal property owned by Tracks of Texas to Xxxxxx that is used
exclusively or partially in the Business;
WHEREAS, Buyer desires to purchase certain specified assets of Sellers,
and to assume certain specified employee cost liabilities of Sellers' Business,
and Sellers desire to sell such assets to Buyer and for Buyer to assume such
specified employee cost liabilities;
WHEREAS, Sellers and Buyer desire to provide for the assignment to and
assumption by Buyer of certain Xxxxxx contracts and Sellers leases pertinent to
the Business and to provide transitional arrangements with respect thereto
pending completion of such assignments and assumptions, all as provided in this
Agreement and the Subcontract Agreement and Master Sublease Agreement
contemplated hereby;
WHEREAS, Sellers and Buyer desire to provide arrangement for completion
and closing out of certain Xxxxxx contracts not being assigned to or assumed by
Buyer, all as provided in this Agreement and the Subcontract Agreement; and
WHEREAS, Sellers are each wholly-owned subsidiaries of Insituform
Technologies, Inc., a Delaware corporation ("SELLERS' PARENT"), and Buyer is
wholly-owned by Sterling General, Inc., a Delaware corporation and Buyer's sole
general partner, and Sterling Houston Holdings, Inc., a Delaware corporation and
Buyer's sole limited partner (together, "BUYER'S PARENTS");
NOW, THEREFORE, in consideration of the premises and mutual promises
and covenants herein contained, the Parties hereby stipulate and agree as
follows:
SECTION 1
DEFINITIONS
Certain capitalized terms used in this Agreement have the meanings
specified in the GLOSSARY attached hereto. Other terms may be defined elsewhere
in the body of this Agreement and shall have the meaning indicated throughout
this Agreement. The terms defined in the singular shall have a comparable
meaning when used in the plural, and vice versa.
SECTION 2
PURCHASE AND SALE OF ACQUIRED ASSETS; ASSUMPTION OF TRANSFERRED
EMPLOYEE COSTS; ARRANGEMENTS REGARDING BUSINESS CONTRACTS AND LEASES
2.1. Acquired Assets. At the Effective Time, in accordance with this
Agreement, Sellers shall sell, convey, transfer, assign and deliver to Buyer,
and Buyer shall purchase from Sellers, all of Sellers' right, title and interest
in and to all of the equipment used in Sellers' Business as of the Closing Date
that is listed on Schedule 2.1 as "Acquired Equipment" (such schedule, the
"EQUIPMENT SCHEDULE," and such equipment, the "ACQUIRED EQUIPMENT," and
sometimes referred to herein as the "ACQUIRED ASSETS"), free and clear of all
Liens. (The equipment listed on Schedule 2.1 as Port Contract Equipment is
referred to as the "PORT CONTRACT EQUIPMENT" but is not being conveyed at
Closing.)
2.2. Transferred Employee Costs. At the Effective Time, in accordance
with this Agreement, Buyer shall assume from Sellers and shall be bound by,
shall be liable for and shall pay, perform or otherwise discharge as the same
shall become due in accordance with their respective terms, those certain
liabilities and obligations of Sellers set forth on Schedule 2.2 hereto, but in
each case and only as, and not in excess of the respective amounts set forth on
Schedule 2.2 and only as to those of the employees of the Business who are
offered and qualify for employment by Buyer and are employed by Buyer after the
Closing pursuant to Section 8.1 hereof ("TRANSFERRED EMPLOYEES") (such assumed
liabilities and obligations as to such Transferred Employees, "TRANSFERRED
EMPLOYEE COSTS").
2.3. Purchase Price; Adjustments. In consideration of the sale,
assignment, and delivery of the Acquired Assets, Buyer shall assume the
Transferred Employee Costs and shall pay the Sellers a total consideration of
$4,361,100, subject to adjustment as provided in the following sentence, in the
form of cash and two subordinated notes as provided in Section 2.4 (the
"PURCHASE PRICE"). The Purchase Price shall be reduced by the amount of the
Transferred Employee Costs, and shall be subject to further reduction by an
amount equal to the value of the U.S. 59 Contract Equipment, if any, transferred
by Buyer to Sellers pursuant to Section 2.7.
2.4. Payment of Purchase Price. The Purchase Price shall be payable by
the Buyer to the Sellers on the Closing Date as follows:
(a) Buyer will pay Sellers an amount equal to the Purchase Price
less $1,500,000 in cash by cashier's check or by wire transfer
in immediately available federal funds; and
(b) Buyer will execute and deliver to Sellers a subordinated
promissory note in the principal amount of $800,000 in the
form of Exhibit A attached hereto (the "SUBORDINATED NOTE")
and a subordinated promissory note in the principal amount of
$700,000 in the form of Exhibit B attached hereto (the
"CONTRACT SUBORDINATED NOTE"). The Subordinated Note and the
Contract Subordinated Note shall be subject in all respects to
the Subordination Agreement referred to therein and in the
form attached hereto as Exhibit E (the "SUBORDINATION
AGREEMENT").
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The obligations of Buyer (and Buyer's Parents) under the Subordinated Note and
the Contract Subordinated Note, including the obligations to make payments of
principal or interest under such notes, shall be in all respects subject to the
terms and provisions of this Agreement.
2.5. Allocation. The Purchase Price for the Acquired Assets shall be
allocated in accordance with the Equipment Schedule "American Appraisal" values.
Each party agrees to complete Internal Revenue Form 8594, Asset Acquisition
Statement under Section 1060 of the Code consistent with the Equipment Schedule
"American Appraisal" values.
2.6. Liabilities Not Assumed. Except as set forth in Section 2.2, Buyer
assumes no liabilities or obligations of Sellers, all of which shall be retained
by the Sellers. Without in any way limiting the generality of the foregoing,
Buyer does not assume the following:
(a) Any liability of Sellers arising from, or in connection with,
the conduct of Sellers' Business prior to the Closing Date or
the ownership of the Acquired Assets prior to the Closing Date
(whether or not such liability accrues before, on or after the
Closing Date); and
(b) Except for Transferred Employee Costs, any liabilities or
obligations of the Sellers to the employees (or any of
Sellers' former employees) of the Business incurred or accrued
while employed by Sellers prior to Closing, including, without
limitation, liabilities associated with Sellers' 401(k) plan,
employee discrimination claims, worker's compensation claims
and claims to holiday or sick leave.
2.7. Options Related to U.S. 59 Contract. The Parties acknowledge that
the notice to proceed (the "NOTICE TO PROCEED") with respect to the "U.S. 59
CONTRACT" (as defined in the Subcontract Agreement referenced in Section 2.8
hereof) has not been received from the Texas Department of Transportation as of
the date hereof. If the Notice to Proceed is not received from the Texas
Department of Transportation at or prior to December 31, 2002 (or if the Parties
so mutually agree hereafter, March 31, 2003) (the "CONTRACT NOTICE PERIOD"),
then Buyer shall have the option (the "BUYER'S OPTION") to transfer back to
Sellers, and Sellers shall re-acquire from Buyer, any or all of the Acquired
Equipment designated as "U.S. 59 CONTRACT EQUIPMENT" on the Equipment Schedule.
Buyer must exercise this option in writing to Sellers within ten (10) business
days of the expiration of the Contract Notice Period. Upon the exercise of the
Buyer's Option, the Purchase Price shall be adjusted by the amount equal to the
aggregate value of the U.S. 59 Contract Equipment so to be returned (the
"REDUCTION AMOUNT"), and the Reduction Amount shall be refunded by Sellers to
Buyer (i) first, by reducing ab initio the principal amount of the Contract
Subordinated Note by the Reduction Amount and (ii) second, to the extent that
the Reduction Amount equals or exceeds the amount of the Contract Subordinated
Note, the Contract Subordinated Note will be cancelled and returned to Buyer, no
amounts (principal or interest) shall be due thereunder, and Sellers shall repay
to Buyer in cash the difference between the Reduction Amount and the amount of
the Contract Subordinated Note. Except as provided in the previous sentence,
Buyer shall not receive any other consideration for such transfer of U.S. 59
Contract Equipment; and Sellers shall not be entitled to any compensation for
any of Buyer's U.S. 59 Contract Equipment through the date of such transfer. If
Buyer exercises the Buyer's Option, Xxxxxx shall retain all of the rights and
interests to the U.S. 59 Contract and Buyer shall
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deliver the U.S. 59 Contract Equipment to Sellers in Xxxxxx County, Texas within
ten (10) business days after notice of the delivery site from Sellers. The
Parties agree to execute and deliver any documents or instruments necessary to
effectuate the transactions contemplated under this Section 2.7.
2.8. Arrangement Regarding Business Contracts. At the Closing, Sellers
and Buyer will enter into that certain Subcontract Agreement, referring to this
Agreement and forming an integral part hereof (the "SUBCONTRACT AGREEMENT"),
pursuant to which, among other things and as more fully set forth in the
Subcontract Agreement:
(a) Sellers shall undertake to assign to Buyer, and Buyer shall
undertake to assume from Sellers, as promptly as is reasonably
practicable after the Closing, three construction contracts
specified in the Subcontract Agreement (the "ASSIGNED
CONTRACTS") and, pending such assignment and assumption, Buyer
shall undertake the performance of the Assigned Contracts as
Sellers' subcontractor;
(b) Sellers shall undertake to assign to Buyer, and Buyer shall
undertake to assume from Sellers, as promptly as is reasonably
practicable after receipt of the Notice to Proceed with
respect to the U.S. 59 Contract (provided that the Notice to
Proceed is so received prior to the end of the Contract Notice
Period), the U.S. 59 Contract and, pending such assignment and
assumption, Buyer shall after such receipt of the Notice to
Proceed undertake the performance of the U.S. 59 Contract as
Sellers' subcontractor; and
(c) Sellers shall not assign to Buyer, and Buyer shall not assume
from Sellers, the remaining construction contracts of Sellers
(as more fully specified in the Subcontract Agreement, the
"RETAINED CONTRACTS"), but until completion thereof, Buyer
shall perform remaining work thereon for Sellers as Sellers'
subcontractor. The Assigned Contracts, the U.S. 59 Contract
and the Retained Contracts are sometimes referred to as the
"BUSINESS CONTRACTS."
2.9. Arrangements Regarding Leases. At the Closing, Sellers and Buyer
will enter into that certain Master Equipment Sublease, referring to this
Agreement and forming an integral part thereof (the "SUBLEASE AGREEMENT"),
pursuant to which, among other things and as more fully set forth in the
Sublease Agreement, Sellers shall undertake to assign to Buyer, and Buyer shall
undertake to assume from Sellers, the "PRIME LEASES" (as defined in the Sublease
Agreement) and, pending such assignment and assumption, Buyer shall undertake
the performance of the Prime Leases as Sellers' sublessee.
2.10. Closing. Except as otherwise specified, closing of the
transactions provided for in this Agreement (the "CLOSING") shall take place at
9:00 a.m. on September 23, 2002 or at such other time and on such other date as
the Parties may agree upon in writing (the "CLOSING DATE"). The Closing shall
take place at the offices of Xxxxxxx & Xxxxx L.L.P., 000 Xxxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxx, or at such other place as the Parties may agree upon in writing.
The "EFFECTIVE TIME" shall be 12:01 a.m., Houston time, on the Closing Date.
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SECTION 3
REPRESENTATIONS AND WARRANTIES OF SELLERS
Sellers, jointly and severally, represent and warrant to Buyer that the
following representations and warranties are true and correct as of the date of
this Agreement and will be true and correct through the Closing as if made on
and as of the Closing Date:
3.1. Corporate Standing. Each Seller is a corporation duly
incorporated, validly existing and in good standing under the laws of the
jurisdiction of its incorporation with the power to own its respective assets
and carry on its business as presently conducted. Each Seller is duly qualified
to do business and is in good standing in each state or other jurisdiction where
such qualification is required.
3.2. Authority. Each of the Sellers has the power and authority to
execute, deliver and perform this Agreement and all other instruments and
documents required or contemplated to be executed, delivered and performed by
them under this Agreement. With respect to each Seller, such execution, delivery
and performance (i) have been duly authorized by all necessary action of their
respective board of directors, (ii) do not and will not require the approval of
any Person whose approval has not been obtained or disclosed herein or on
Schedule 3.2 hereto, (iii) do not and will not contravene their respective
certificates or articles of incorporation or bylaws, (iv) do not and will not,
except as disclosed herein or on Schedule 3.2 hereto, contravene, conflict with,
result in a violation (or any occurrence which by notice or passage of time or
both would constitute a violation) of, or entitle any party to terminate,
accelerate or declare a default with respect to, any material contract,
mortgage, franchise, deed of trust, lease, license or agreement of Sellers or
Sellers' Parent, or any rule, regulation, order, writ or decree applicable to
Sellers, (v) do not and will not result in the creation or imposition of any
material Lien upon any of the Acquired Assets, and (vi) will not result in the
violation of any Laws.
3.3. Valid and Binding Obligations. This Agreement and each of the
documents and instruments to be executed by Sellers and delivered to Buyer
pursuant to this Agreement when so delivered will constitute their respective
legal, valid and binding obligations enforceable in accordance with the
respective terms of each such agreement, document or instrument.
3.4. Equipment. The Equipment Schedule is a complete and accurate
schedule describing (i) all Acquired Equipment and (ii) all equipment to be made
available to Buyer under the Master Equipment Sublease, and providing accurate
information as to all such Acquired Equipment and equipment to be made available
to Buyer under the Master Equipment Sublease. There has been no major
deterioration or damage with respect to any of such equipment from the date that
Buyer inspected such equipment. Such equipment represents all material equipment
owned or leased by Sellers and used in connection with Sellers' Business,
excluding only those items of equipment that are readily available to Buyer on
the rental or purchase market, and includes all tangible personal property owned
and currently being used by Sellers exclusively in the Business. Except as set
forth herein, the Acquired Equipment is being sold and assigned "AS IS, WHERE
IS," and Buyer hereby agrees thereto.
3.5. Title and Liens. Except as set forth on the Equipment Schedule,
Sellers have, at the Effective Time, good and valid title to the Acquired
Equipment, free and clear of all Liens.
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All leases relating to Acquired Equipment in effect between Xxxxxx and Tracks of
Texas are hereby terminated as of the Effective Time.
3.6. Litigation. Except as set forth in Schedule 3.6, there is no
material claim, action, suit, governmental investigation, or other legal or
administrative proceeding pending or Threatened against Sellers relating to
Sellers' Business. If any of the matters set forth on Schedule 3.6 is decided
adversely to Sellers, such adverse decision will not result in loss or
forfeiture of, or creation of any material Lien upon, any of the Acquired Assets
or any claim against Buyer. Except as set forth on Schedule 3.6, Sellers are not
subject to any order, writ, injunction or decree of any court, department,
agency or instrumentality with respect to Sellers' Business, and Sellers are not
in violation of or in default with respect to any such order, writ, injunction
or decree.
3.7. Business Contracts. Each Business Contract is valid and binding
upon the Seller that is party to such contract and is in full force and effect
according to its terms, and there have been no amendments, modifications,
addenda or supplements thereto subsequent to the public bid materials other than
such as are specifically listed in Schedule 3.7 hereto and furnished to Buyer or
have been disclosed or consented to by Buyer in accordance with the Agreement.
With respect to the Business Contracts and the Prime Leases, except as set forth
on Schedule 3.7, (i) there is no default, and Sellers have not received a claim
of default, under any Assigned Contract, U.S. 59 Contract or Prime Lease, (ii)
Sellers have complied with all Laws and orders of regulatory agencies relating
to such Business Contracts and Prime Leases, except where the failure to so
comply would not result in a material adverse effect on such contracts, and
(iii) there has been no action instituted or Threatened against Sellers by any
governmental entity, board, bureau, agency, instrumentality or other tribunal
for any violation of any Laws or orders of regulatory agencies that would result
in a material adverse effect on the Business Contracts, the Prime Leases or the
Acquired Assets. No event has occurred that, with the passage of time or the
giving of notice (or both), could constitute a material default by Sellers under
any Business Contract or Prime Lease, or result in the creation of any material
Lien on any of the Acquired Assets.
3.8. Finder's Fee. Except for the arrangement between Sellers' Parent,
Sellers and X. X. Xxxxxxx & Sons, Inc. in connection with the transactions
contemplated by this Agreement, all negotiations relating to this Agreement and
the transactions contemplated hereby have been carried out without the
intervention of any Person acting on behalf of any Seller or Sellers' Parent in
such manner as to give rise to any valid claim for any commission, or other fee,
against Buyer, Buyer's Parents, Sellers or Sellers' Parent. Sellers' Parent and
Sellers will be solely responsible for and will pay all amounts due X.X. Xxxxxxx
& Sons, Inc.
3.9. Transferred Employee Costs. Schedule 2.2 to this Agreement is a
complete and accurate schedule describing all of the costs that, upon the
applicable employees of Sellers becoming employees of Buyer under Section 8.1
will become Transferred Employee Costs.
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SECTION 4
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Sellers that the following
representations and warranties are true and correct as of the date of this
Agreement and will be true and correct through the Closing as if made on and as
of the Closing Date:
4.1. Organization and Good Standing. Buyer is a limited partnership
duly formed, validly existing and in good standing under the laws of the State
of Texas with the power to own its assets and carry on its business as presently
conducted and the Business. Buyer is duly qualified to do business and is in
good standing in each state or other jurisdiction where such qualification is
required or will be required to operate the Business.
4.2. Authority. Buyer has the power and authority to execute, deliver
and perform this Agreement and all other instruments and documents required or
contemplated to be executed, delivered and performed by it under this Agreement.
With respect to Buyer, such execution, delivery and performance (i) has been
duly authorized by all necessary action of Buyer's partners, (ii) do not and
will not require the approval of any Person whose approval has not been obtained
or disclosed herein, (iii) do not and will not contravene Buyer's partnership
agreement or similar organizational documents, (iv) do not and will not
contravene, conflict with, result in a violation (or any occurrence which by
notice or passage of time or both would constitute a violation) of, or entitle
any party to terminate, accelerate or declare a default with respect to,
material any contract, mortgage, franchise, deed of trust, lease, license or
agreement of Buyer, or any rule, regulation, order, writ or decree applicable to
Buyer, and (vi) will not result in the violation of any Laws.
4.3. Valid and Binding Obligations. This Agreement and each of the
documents and instruments to be executed by Buyer and delivered to Sellers
pursuant to this Agreement when so delivered will constitute their respective
legal, valid and binding obligations enforceable in accordance with the
respective terms of each such Agreement, document or instrument.
4.4. Finder's Fee. All negotiations relating to this Agreement and the
transactions contemplated hereby have been carried out without the intervention
of any Person acting on behalf of Buyer in such manner as to give rise to any
valid claim for any commission, or other fee, against Buyer, Buyer's Parents,
Sellers' Parent or Sellers.
SECTION 5
CONDITIONS TO OBLIGATIONS OF BUYER
The obligations of Buyer with respect to the purchase of the Acquired
Assets at the Closing are subject to the satisfaction of the following
conditions, which may be waived in whole or in part by Buyer in writing to the
extent permitted by Law:
5.1. Representations and Warranties Correct. Each representation and
warranty of Sellers made in or pursuant to this Agreement and any related
document or instrument shall be true and correct as of the Closing Date, with
the same force and effect as though made at and as of the Closing Date.
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5.2. Covenants Performed. Sellers shall have performed and satisfied
all covenants and conditions required to be performed or satisfied by them at or
prior to the Closing Date pursuant to this Agreement and any document or
instrument executed in connection with this Agreement.
5.3. Absence of Litigation. No Proceeding shall have been instituted or
Threatened on or prior to the Closing Date seeking to enjoin, restrain,
invalidate, prohibit, avoid, set aside or render illegal in whole or in part the
consummation of the transactions contemplated by this Agreement.
5.4. Consents. All agreements, consents and approvals of any third
parties required to effect the consummation of the transactions contemplated by
this Agreement, or otherwise pertaining to the matters covered by it, shall have
been received on terms satisfactory to Buyer, including the consent of Sellers'
customers, surety bonding company and, if required, subcontractors with respect
to the Subcontract Agreement.
5.5. Release of Liens. Sellers shall deliver to Buyer releases, in a
form reasonably acceptable to Buyer, from the holders of any and all Liens set
forth on Schedule 3.5.
5.6. Delivery of Certain Closing Documents and Agreements. Buyer shall
have received delivery at or prior to Closing of the following:
(a) the Assignment and Assumption Agreement in the form of Exhibit
C (the "ASSIGNMENT AND ASSUMPTION AGREEMENT") duly executed by
the Sellers regarding the assignment and assumption of the
Transferred Employee Costs;
(b) the Xxxx of Sale in the form of Exhibit D (the "XXXX OF SALE")
and motor vehicle title transfer documents duly executed by
the Sellers regarding the conveyance, transfer and assignment
to Buyer of the Acquired Equipment, together with possession
of the Acquired Equipment;
(c) the Subcontract Agreement in the form of Exhibit F (the
"SUBCONTRACT AGREEMENT"), duly completed and executed by
Xxxxxx;
(d) the Subordination Agreement executed by Xxxxxx;
(e) any True-up Payments due to Buyer as provided in the
Subcontract Agreement;
(f) the Master Equipment Sublease in the form of Exhibit G (the
"MASTER SUBLEASE AGREEMENT"), duly completed and executed by
Sellers; and
(g) the Limited Joinder and Guaranty in the form of Exhibit H,
duly completed and executed and delivered by the Sellers'
Parent.
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SECTION 6
CONDITIONS TO OBLIGATIONS OF SELLERS
The obligations of Sellers with respect to the sale of the Acquired
Assets at the Closing are subject to the satisfaction of the following
conditions, which may be waived in whole or in part by Sellers in writing to the
extent permitted by Law:
6.1. Representations and Warranties Correct. Each representation and
warranty of Buyer made in or pursuant to this Agreement and any related document
or instrument shall be true and correct in all respects as of the Closing Date,
with the same force and effect as though made at and as of the Closing Date.
6.2. Covenants Performed. Buyer shall have performed and satisfied all
covenants and conditions required to be performed or satisfied by it on or prior
to the Closing Date pursuant to this Agreement and any document or instrument
executed in connection with this Agreement.
6.3. Absence of Litigation. No Proceeding shall have been instituted or
Threatened on or prior to Closing Date seeking to enjoin, restrain, invalidate,
prohibit, avoid, set aside or render illegal in whole or in part the
consummation of the transactions contemplated by this Agreement.
6.4. Consents. All agreements, consents and approvals of any third
parties required to effect the consummation of the transactions contemplated by
this Agreement, or otherwise pertaining to the matters covered by it, shall have
been received on terms satisfactory to Sellers, including the consent of
Sellers' customers, surety bonding company and subcontractors with respect to
the Subcontract Agreement.
6.5. Payment of Purchase Price and Delivery of Certain Documents.
Seller shall have received delivery at or prior to Closing of the following:
(a) the Purchase Price as set forth in Section 2.3 hereof;
(b) the Subordinated Note and the Contract Subordinated Note
executed by Buyer;
(c) the Subordination Agreement executed by Buyer;
(d) the Assignment and Assumption Agreement executed by Buyer;
(e) the Subcontract Agreement, duly completed and executed by
Buyer;
(f) any True-Up Payments due to Xxxxxx as provided in the
Subcontract Agreement;
(g) the Master Equipment Sublease, duly completed and executed by
Buyer;
(h) the Limited Joinder and Guaranty executed in the form of
Exhibit I, duly executed by the Buyer's Parents; and
(i) Buyer's sales tax exemption certificate, duly completed and
executed by Buyer.
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SECTION 7
INDEMNIFICATION
7.1. Sellers' Indemnity. Subject to the provisions of this Section 7,
Sellers shall indemnify, defend and hold harmless Buyer and Buyer's Parents and
their respective directors, officers, employees, representatives and agents from
and against any and all Damages suffered, sustained, incurred or required to be
paid directly or indirectly by them in connection with, as a result of or
arising out of any matter or event of any nature whatsoever (i) arising from a
Non-Assumed Liability or (ii) relating to either Seller or the ownership or use
of the Acquired Assets or the operation of the Business (including any act or
omission of any employee) which occurred prior to the Effective Time and is not
a Transferred Employee Cost or (iii) (in addition to any other indemnification
provided under any other agreement) resulting from any default by Sellers under
any Business Contract occurring prior to the Effective Time.
7.2. Buyer Indemnity. Subject to the provisions of this Section 7,
Buyer shall indemnify, defend and hold harmless Sellers and Parent and their
respective directors, officers, employees, representatives and agents from and
against any and all Damages suffered, sustained, incurred or required to be paid
directly or indirectly by them in connection with, as a result of or arising out
of any matter or event of any nature whatsoever (i) arising from a Transferred
Employee Cost or (ii) relating to Buyer or the ownership or use of the Acquired
Assets or the operation of the Business (including any act or omission of any
Transferred Employee) which occurs after the Effective Time or (iii) relating to
any liability or obligations relating to the payment of sales, use, transfer or
similar taxes, or any associated interest or penalties, in connection with this
Transaction.
7.3. Claims Procedure. All claims for indemnification by an Indemnified
Party against an Indemnifying Party pursuant to this Section 7 shall be asserted
and resolved as set forth in this Section 7.3. As soon as reasonably practicable
after becoming aware of a claim for indemnification under this Agreement
(including the assertion of any claim, or the commencement of any suit, action
or proceeding, by any Person not a party hereto for which indemnity may be
sought under this Agreement), an Indemnified Party shall promptly, but in no
event more than 30 days after such Indemnified Party becomes aware of such
claim, notify the Indemnifying Party of such claim and the amount or the
estimated amount thereof to the extent then feasible (which estimate shall not
be conclusive of the final amount of such claim) (the "CLAIM NOTICE"); provided,
however, that the right of an Indemnified Party to be indemnified hereunder
shall not be adversely affected by such party's failure to give such Claim
Notice unless, and then only to the extent that, an Indemnifying Party is
prejudiced thereby. The Indemnifying Party shall have 30 days from the personal
delivery or mailing of the Claim Notice (the "NOTICE PERIOD") to notify the
Indemnified Party (i) whether or not the Indemnifying Party disputes its
liability to the Indemnified Party hereunder with respect to such claim and (ii)
if such claim involves a third party claim, whether or not the Indemnifying
Party desires to defend the Indemnified Party against such claim. If the
Indemnifying Party does not dispute its liability for such claim in writing
within the Notice Period, then the Indemnified Party shall be entitled
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to recover immediately (or as soon as known) from the Indemnifying Party the
amount of such claim; provided, however, if the Indemnifying Party agrees that
it has an indemnification obligation, but disputes the amount of its obligation,
then the Indemnified Party shall be entitled to recover immediately (or as soon
as known) from the Indemnifying Party the amount not in dispute, without
prejudice to the Indemnified Party's claim for the amount in dispute. Any such
dispute shall be resolved in accordance with the dispute resolution procedures
generally applicable to this Agreement.
(a) Defense of Third-Party Claims. If the Indemnifying Party
notifies the Indemnified Party in writing within the Notice
Period that it desires to defend the Indemnified Party against
any third-party claim, then the Indemnifying Party may assume
such defense upon delivery to the Indemnified Party of a
written agreement acknowledging that (i) the Indemnified Party
is entitled to indemnification for all Damages arising out of
such claim and (ii) the Indemnifying Party shall be liable for
the entire amount of any Damages, at any time during the
course of any such claim; provided, however, that (i) the
Indemnifying Party's counsel must be reasonably satisfactory
to the Indemnified Party and (ii) the Indemnifying Party shall
thereafter consult with the Indemnified Party upon the
Indemnified Party's reasonable request for such consultation
from time to time with respect to such claim. All costs and
expenses incurred by the Indemnifying Party in defending such
claim or demand shall be a liability of, and shall be paid by,
the Indemnifying Party. If the Indemnifying Party assumes such
defense, the Indemnified Party shall have the right (but not
the duty) to participate in the defense thereof and to employ
such counsel, at its own expense, separate from the counsel
employed by the Indemnifying Party. If, however, the
Indemnified Party reasonably determines in its judgment that
representation by the Indemnifying Party's counsel of both the
Indemnifying Party and the Indemnified Party would present
such counsel with a conflict of interest, then such
Indemnified Party may employ separate counsel to represent or
defend it in any such claim and the Indemnifying Party shall
pay the fees and disbursements of such separate counsel.
Notwithstanding anything contained herein to the contrary, to
the extent either the Indemnifying Party or the Indemnified
Party has insurance coverage that covers defense costs, such
insurance shall pay the defense costs of such third-party's
claim.
If the Indemnifying Party elects not to defend the
Indemnified Party against such third-party claim, whether by
not giving the Indemnified Party timely notice as provided
above or otherwise, then the amount of any such claim, or, if
the claim is contested by the Indemnified Party, then that
portion thereof as to which such defense is unsuccessful (and
the reasonable costs and expenses, including attorney fees,
pertaining to such defense) shall be the liability of the
Indemnifying Party hereunder.
The Indemnifying Party and the Indemnified Party
shall give each other and their respective counsel access,
during normal business hours, to relevant business records and
other documents, and shall permit them to consult with their
respective agents and employees regarding the defense of any
third-party claim.
(b) Settlement or Compromise. Any settlement or compromise made or
caused to be made in accordance with the provisions of this
Section 7.3 by the Indemnified
11
Party or the Indemnifying Party, as the case may be, of any
third-party claim shall also be binding upon the Indemnifying
Party or the Indemnified Party, as the case may be, in the
same manner as if a final judgment or decree had been entered
by a court of competent jurisdiction in the amount of such
settlement or compromise; provided, however, (i) no
obligation, restriction or Damages shall be imposed on the
Indemnified Party as a result of any such settlement or
compromise without its prior written consent and (ii) no
statement or admission that could be detrimental to Buyer, the
Acquired Assets or the Business may be made as part of any
such settlement or compromise without the prior written
consent of Buyer. The Indemnified Party will give the
Indemnifying Party at least 30 days' prior written notice of
any proposed settlement or compromise of any third-party claim
it is defending, during which time the Indemnifying Party may
reject such proposed settlement or compromise; provided,
however, from and after such rejection, the Indemnifying Party
shall be obligated to assume the defense of and full and
complete liability and responsibility for such claim and any
and all Damages in connection therewith in excess of the
amount of unindemnifiable Damages which the Indemnified Party
would have been obligated to pay under the proposed settlement
or compromise
7.4. Insurance Proceeds. In calculating any amounts to be paid by an
Indemnifying Party to an Indemnified Party, such amounts shall be reduced by all
net insurance reimbursements actually credited to or received by the Indemnified
Party, relating to the underlying claim for indemnification. In connection
therewith, upon request, each Party shall seek a waiver of subrogation with
respect to such reimbursements from its insurer(s).
SECTION 8
POST-CLOSING COVENANTS
8.1. Employees. Effective as of the Closing, Buyer may, but is not
required to, offer employment to any of the employees of the Business on terms
and conditions to be negotiated between Buyer and such employees.
Notwithstanding anything contained in this Agreement to the contrary, Buyer
shall not be obligated to employ any person for any particular period or on any
particular terms or conditions of employment.
8.2. Actions after Closing.
(a) Further Assurances. From time to time after the Closing, each
Party (for no additional consideration) shall take such acts
and execute and deliver to a requesting Party such documents
and instruments of sale, transfer, conveyance, assignment,
delivery and such consents, assurances, powers of attorney and
other similar instruments as may be reasonably requested by
such Party or its counsel in order: (i) to vest in Buyer all
right, title and interest in and to the Acquired Assets; (ii)
to assign to Buyer, and for Buyer to assume, all of the rights
and obligations under the Assigned Contracts and Prime Leases;
(iii) subject to the issuance of the Notice to Proceed prior
to the end of the Contract Notice Period, to assign to Buyer,
and for Buyer to assume all of the rights and obligations
under the U.S. 59
12
Contract; and (iv) in all other respects to carry out the
purposes and intent of this Agreement.
(b) Failure to Obtain Certain Consents. Nothing contained in this
Agreement shall be construed as an attempt to agree or an
agreement to assign any Business Contract, including any
contract, agreement or license, which is at law non-assignable
or which is non-assignable without the Requisite Approval of
another Person, unless such Requisite Approval shall be given.
Sellers and Buyer shall use all commercially reasonable
efforts to obtain all Requisite Approvals of such Persons to
the assignment of the Assigned Contracts, the Prime Leases,
and, if and when applicable, the U.S. 59 Contract. If the
Requisite Approvals of any Person to any such assignment
cannot be obtained, or if any such attempted assignment would
be ineffective or would adversely affect, as applicable, the
Sellers' rights thereunder so that Buyer would not in fact
receive all such rights, Sellers shall cooperate in any
arrangement Buyer may reasonably request to provide for Buyer
all benefits of any such lease or contract, including the
enforcement for the benefit of Buyer of any and all of
Sellers' rights against any other party thereto arising out of
the breach or cancellation thereof by such party or otherwise.
(c) Non-Compete; Non-Solicitation of Employees. As of the
Effective Time and for a period of two (2) years thereafter,
Sellers and Sellers' Parent will not, for themselves or on
behalf of another Person or entity (i) directly or indirectly,
engage in, or acquire, establish or own any financial,
beneficial or other interest in an entity engaged in the
Restricted Business; or (ii) directly or indirectly, solicit
or induce, or attempt to solicit or induce, any employee of
Buyer to terminate their employment with Buyer; provided,
however, that the foregoing restrictions shall not prohibit
Sellers or Sellers' Parent from (A) fulfilling its obligations
under any Retained Contract, (B) continuing to engage in any
business that Sellers and Sellers' Parent are currently
engaged in other than the Restricted Business, (C) owning less
than five percent (5%) of any class of securities of any
corporation whose voting securities are listed on any national
securities exchange, (D) acquiring a business that includes
and operates a Restricted Business that represents for the 12
month period preceding acquisition less than 50% of such
acquired business' revenues; provided, that Sellers shall
promptly, continuously and actively pursue divesting such
Restricted Business portion, and shall in any event complete
such divestiture within 18 months after such acquisition, and
Sellers shall give Buyer a right of first negotiation to
acquire such divested business, (E) being acquired by a Person
with an existing Restricted Business, or (F) placing
advertisements in newspapers or other media, using recruiters
or other marketers, or utilizing any other form of marketing
or advertisement.
(d) Records. Sellers will maintain and provide Buyer and its
representatives reasonable access to all records and documents
and will cause its personnel to cooperate on a reasonable
basis as Buyer may require to assist it in connection with tax
matters or preparation of financial statements that may be
required by the Securities and Exchange Commission's rules and
regulations or in connection with the Acquired Assets, the
Business Contracts, the Prime Leases or the
13
Transferred Employees. Notwithstanding anything contained
herein to the contrary, Sellers may deliver such records and
documents to Buyer, in which event Sellers will have no
further obligation under this Section with respect to
providing access to such records and documents so delivered to
Buyer.
(e) Access to Transferred Employees. After Closing, Buyer will
cause any Transferred Employees to cooperate on a reasonable
basis as Sellers may require to assist them in connection with
any pending litigation, or any litigation arising subsequent
to Closing, which relates to the Sellers' Business, the
Acquired Assets, the Business Contracts, the Prime Leases or a
Transferred Employee and relates to the period prior to
Closing.
SECTION 9
MISCELLANEOUS
9.1. Transfer Fees; Expenses. Any transfer fees, recording costs or
transfer, sales, use or similar taxes related to the transfer of the Acquired
Assets shall be the responsibility of Buyer. Each Party shall bear all of its
own costs and expenses incurred in connection with the negotiation and
consummation of this Agreement and the transactions contemplated herein.
Expenses other those provided above that are incurred in connection with this
transaction shall be the responsibility of the Party incurring such expenses.
9.2. Entire Agreement. This Agreement incorporates by this reference
the recitals at the beginning of this Agreement and any exhibits or schedules
hereto. Each Party represents and warrants that any facts relating to such Party
that are contained in the recitals are true. This Agreement and any agreement,
instrument or document to be executed in connection herewith (as referenced
herein) contain the parties' entire understanding and agreement with respect to
the subject matter hereof. Any discussions, agreements, promises,
representations, warranties or statements between the parties or their
representatives (whether or not conflicting or inconsistent) that are not
expressly contained or incorporated herein shall be null and void and are merged
into this Agreement. If this Agreement and any agreement, instrument or document
to be executed in connection herewith contain provisions which are inconsistent,
then the provision which is most specific with respect to the subject matter
shall control.
9.3. Modification, Amendment and Waiver. Neither this Agreement, nor
any part hereof, may be modified or amended orally, by trade usage or by course
of conduct or dealing, but only by and pursuant to an instrument in writing duly
executed and delivered by the party sought to be charged therewith. Neither the
failure nor any delay by any Party in exercising any right, power or privilege
under this Agreement or the documents referred to in this Agreement will operate
as a waiver of such right, power or privilege, and no single or partial exercise
of any such right, power or privilege will preclude any other or further
exercise of such right, power, or privilege of the exercise of any other right,
power or privilege.
9.4. Successors and Assigns. This Agreement shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
permitted assigns. Except as expressly provided herein, neither this Agreement
nor any rights hereunder may be assigned or transferred, and no duties may be
delegated, without the prior written consent of the other party.
14
Notwithstanding anything contained in the previous sentence to the contrary,
Buyer may assign or transfer it rights, and delegate its duties, hereunder to
any Affiliate of Buyer.
9.5. No Third Party Beneficiary. This Agreement is for the benefit of,
and may be enforced only by, the Parties who are signatories hereto and their
respective successors and permitted assignees. This Agreement is not for the
benefit of, and may not be enforced by, any third party.
9.6. Construction. This Agreement shall not be construed more strictly
against one party than against another party merely by virtue of the fact that
this Agreement may have been physically prepared by such party, or such party's
counsel, it being agreed that all parties, and their respective counsel, have
mutually participated in the negotiation and preparation of this Agreement.
Unless the context of this Agreement clearly requires otherwise: (i) references
to the plural include the singular and vice versa; (ii) references to any Person
include such Person's successors and assigns but, if applicable, only if such
successors and assigns are permitted by this Agreement; (iii) references to one
gender includes all genders; (iv) neither the term "including" nor the term
"include" is limiting; (v) "or" has the inclusive meaning represented by the
phrase "and/or"; (vi) the words "hereof", "herein", "hereby", "hereunder" and
similar terms in this Agreement refer to this Agreement as a whole and not to
any particular provision of this Agreement; (vii) article, section, subsection,
clause, exhibit and schedule references are to this Agreement unless otherwise
specified; (viii) reference to any agreement (including this Agreement),
document or instrument means such agreement, document or instrument as amended
or modified and in effect from time to time in accordance with the terms thereof
and, if applicable, the terms hereof; and (ix) general or specific references to
any requirement of Law means such law as amended, modified, codified or
re-enacted, in whole or in part, and in effect from time to time.
9.7. Interpretation in Accordance with GAAP. The parties acknowledge
that several terms and concepts (such as various financial and accounting terms
and concepts) used or referred to herein are intended to have specific meanings
and are intended to be applied in specific ways, but they are not so expressly
and fully defined and explained in this Agreement. In order to supplement
definitions and other provisions contained in this Agreement and to provide a
means for interpreting undefined terms and applying certain concepts, the
parties agree that, except as expressly provided herein, when amounts are to be
determined or other financial calculations are to be made, GAAP and the
applicable Party's past accounting practice shall be used to interpret and
determine such terms and to apply such concepts.
9.8. Notices. All notices or other communications required or permitted
under this Agreement shall be made in writing and shall be deemed given (i) upon
delivery, if sent by (A) personal delivery or (B) courier (e.g., overnight
delivery), (ii) 3 days after being sent by certified mail, return receipt
requested, postage and registration fees prepaid and correctly addressed to a
Party as set forth below or (iii) upon sending, if sent by telecopy to a Party
at the number listed below for such Party (with a telecopy machine generated
confirmation sheet retained by the sender):
15
To Sellers:
Xxxxxx Industries, Inc. / Tracks of Texas, Inc.
c/o Insituform Technologies, Inc.
702 Spirit 00 Xxxx Xxxxx
Xxxxxxxxxxxx, Xxxxxxxx 00000
Attention: President
Facsimile No.: 636.530.8700
with a required copy to:
Insituform Technologies, Inc.
702 Spirit 00 Xxxx Xxxxx
Xxxxxxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Facsimile No.: (000) 000-0000
To Buyer:
Texas Sterling Construction, LP
00000 Xxxxxxxx Xxxx
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Xx.
Facsimile No.: (000) 000-0000
with a required copy to:
Xxxxxxxx X. Xxxxxx, Esq.
Xxxxxxx & Xxxxx L.L.P.
000 Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Facsimile No.: (000) 000-0000
Any address or telecopy number listed above may be changed by a Party notifying
all other Parties of such change in the manner provided above. A notice sent
only to a person to be copied with a notice shall not constitute notice to a
Party hereunder. The Parties shall acknowledge in writing any notice given by
personal delivery.
9.9. Remedies Cumulative. All rights and remedies granted in this
Agreement or available under Law shall be deemed concurrent and cumulative, and
not alternative or exclusive remedies, to the full extent permitted by law and
this Agreement. Any Party may proceed with any number of remedies at the same
time or in any order. The exercise of any one right or remedy shall not be
deemed a waiver or release of any other right or remedy. The Parties waive any
right they may have to require, or any obligation on the part of, another Party
to post a bond in connection with any equitable remedies.
16
9.10. Governing Law. All questions with respect to the formation and
construction of this Agreement, and the rights and obligations of the parties
hereto, shall be governed by and determined in accordance with the laws of the
State of Texas applicable to agreements entered into and performed entirely
within the State of Texas, without giving effect to the choice or conflicts of
law provisions thereof.
9.11. Attorneys Fees. In any suit or proceeding (including arbitration,
insolvency, bankruptcy, investigative, administrative and regulatory
proceedings) arising in connection with this Agreement, the prevailing Party
shall have the right to receive an award of the reasonable attorneys fees and
disbursements actually incurred by it in connection therewith. Each reference to
attorneys fees or attorneys fees and disbursements in this Agreement shall
include attorneys and paralegal fees, expert fees, court costs, expenses and
other disbursements, whether or not suit is brought (and, if suit is brought,
during all trial and appellate phases of litigation) and in any arbitration,
administrative, regulatory, investigative, insolvency or bankruptcy proceedings.
9.12. Severability. If any Section (or part thereof) of this Agreement
is found by an arbitrator or court of competent jurisdiction to be contrary to,
prohibited by or invalid under any requirement of Law, such arbitrator or court
may modify such Section (or part thereof) so, as modified, such Section (or part
thereof) will be enforceable and will to the maximum extent possible comply with
the apparent intent of the parties in drafting such Section (or part thereof).
If no such modification is possible, such Section (or part thereof) shall be
deemed omitted, without invalidating the remaining provisions hereof. No such
modification or omission of a Section (or part thereof) shall in any way affect
or impair such Section (or part thereof) in any other jurisdiction.
9.13. Captions. The captions, headings or titles of the various
Sections of this Agreement are for convenience of reference only, and shall not
be deemed or construed to limit or expand the substantive provisions of such
Sections.
9.14. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which
together shall constitute a single agreement. Each signature page of this
Agreement or any other Transaction Document may be executed and delivered in
original or by a facsimile of such signature page thereto.
9.15. Public Notices. Prior to the Closing, no public notices of this
Agreement, save and except any required by applicable Laws or regulatory
agencies (including stock exchanges), shall be made by Buyer or Sellers;
provided, however, that Sellers' Parent may generally disclose that discussions
are occurring without disclosing specific details such as the Buyer's identity
or price. All public notices prior to Closing will be discussed by the Parties.
9.16. Choice of Forum and Jurisdiction. Any suit, action or proceeding
against any Party with respect to this Agreement, or any judgment entered by any
court in respect thereof may be brought in the Courts of the State of Texas,
County of Xxxxxx or in the United States courts located in the State of Texas
and the Parties hereby submit to the non-exclusive jurisdiction of such courts
for the purpose of any such suit, action or proceeding. Each Party hereby
irrevocably waives any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to
this Agreement brought in the
17
Courts located in the State of Texas, County of Xxxxxx, and hereby further
irrevocably waives any claim that any such suit, action or proceeding brought in
any such court has been brought in an inconvenient forum.
[Remainder of page left blank intentionally]
18
IN WITNESS WHEREOF, the parties have executed this Agreement the day
and year first above written.
BUYER:
TEXAS STERLING CONSTRUCTION, LP
By: Sterling General, Inc.,
a Delaware corporation, its general partner
By: /s/ Xxxxxx X. Xxxxxx, Xx.
-------------------------------------------
Xxxxxx X. Xxxxxx, Xx.
Chief Financial Officer
SELLERS:
XXXXXX INDUSTRIES, INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------------
Xxxxxx X. Xxxxx
President and Chief Financial Officer
TRACKS OF TEXAS, INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------------
Xxxxxx X. Xxxxx
President and Chief Financial Officer
[SIGNATURE PAGE TO ASSET PURCHASE AGREEMENT]
GLOSSARY
Acquired Assets has the meaning as defined in Section 2.1 of this
Agreement.
Acquired Equipment has the meaning as defined in Section 2.1 of this
Agreement.
Affiliate shall mean any Person which is an "affiliate" within the
meaning of the Regulations promulgated under the Securities Act of 1933, as such
Regulations and Act are amended and in effect on the date in question.
Assigned Contracts has the meaning assigned to it in the Subcontract
Agreement.
Assignment and Assumption Agreement has the meaning as defined in
Section 5.6(a) of this Agreement.
Xxxx of Sale has the meaning as defined in Section 5.6(b) of this
Agreement.
Business has the meaning as defined in the preamble of this Agreement.
Business Contracts has the meaning ascribed to it in the Subcontract
Agreement.
Buyer has the meaning as defined in the preamble of this Agreement.
Buyer's Option has the meaning as defined in Section 2.7 of this
Agreement.
Buyer's Parents has the meaning as defined in the preamble of this
Agreement.
Claim Notice shall have the meaning ascribed to it in Section 7.3
hereof.
Closing has the meaning as defined in Section 2.10 of this Agreement.
Closing Date has the meaning as defined in Section 2.10 of this
Agreement.
Code shall mean the Internal Revenue Code of 1986, as amended.
Contract Notice Period has the meaning as defined in Section 2.7 of
this Agreement.
Contract Subordinated Note has the meaning as defined in Section 2.3(b)
of this Agreement.
Damages shall mean any and all damages, losses, liabilities,
obligations, penalties, claims, litigation, demands, defenses, judgments,
amounts paid in settlement, suits, proceedings, costs, disbursements or expenses
(including reasonable attorneys' fees and experts' fees and disbursements as
provided below) of any kind or of any nature whatsoever (whether based on common
law, statute or contract; fixed or contingent; known or unknown) suffered or
incurred.
Effective Time has the meaning as defined in Section 2.10 of this
Agreement.
Equipment Schedule has the meaning as defined in Section 2.1 of this
Agreement.
1
GAAP shall mean Generally Accepted Accounting Principles, applied on a
consistent basis, (a) as set forth in the opinions of the Accounting Principles
Board of the American Institute of Certified Public Accountants ("AICPA") and/or
statements of the Financial Accounting Standards Boards which are applicable in
the circumstances as of the date in question, and (b) which were not
inconsistent with such opinions and statements, as set forth in other AICPA
publications and guidelines and/or which otherwise arise by custom for the
particular industry.
Indemnified Party shall mean a Person claiming indemnification to which
such Person is entitled pursuant to the provisions of Section 7 hereof.
Indemnifying Parties shall mean a Person against whom a valid claim for
indemnification is asserted pursuant to the provisions of Section 7 hereof.
Xxxxxx has the meaning as defined in the preamble of this Agreement.
Law or Laws shall mean any (domestic or foreign) applicable
constitution, treaty, statute, law, ordinance, rule, regulation, policy,
standard, guideline, official interpretation, permit, order, award, decree,
judgment, injunction, ruling, judicial or administrative decision, opinion or
directive, or other requirement having the force of law and, where applicable,
any interpretation thereof by any authority having jurisdiction with respect
thereto or charged with the administration thereof.
Lien or Liens shall mean any mortgage, pledge, deed of trust,
hypothecation, right of others, claim, security interest, encumbrance, burden,
title defect, title retention agreement, lease, sublease, license, occupancy
agreement, easement, covenant, condition, encroachment, voting or voting trust
agreement, interest, option, right of first offer, negotiation or refusal,
preemptive right, proxy, lien, charge or other restrictions or limitations of
any nature whatsoever, including but not limited to such Liens as may arise
under any Business Contracts.
Limited Joinder and Guaranty shall mean those certain Limited Joinder
and Guaranty agreements in the form attached hereto on Exhibit H and Exhibit I,
respectively.
Master Equipment Sublease shall mean that certain master equipment
sublease in the form attached hereto as Exhibit G.
Notice Period shall have the meaning ascribed to it in Section 7.3
hereof.
Notice to Proceed shall have the meaning ascribed to it in Section 2.7
hereof.
Party or Parties has the meaning as defined in the preamble of this
Agreement.
Person shall mean an individual, partnership, joint venture,
corporation, bank, trust, unincorporated organization or governmental body.
Prime Leases has the meaning ascribed to it in the Master Equipment
Sublease.
2
Proceeding shall mean any action, suit, claim, investigation, review or
other proceeding, at law or in equity, before any federal, state, municipal or
other governmental court, department, commission, board, bureau, agency or other
instrumentality.
Purchase Price has the meaning as defined in Section 2.3 of this
Agreement.
Reduction Amount has the meaning as defined in Section 2.7 of this
Agreement.
Requisite Approval shall mean any necessary consent, permit, approval,
waiver, order or authorization of, notice to or registration, qualification,
designation, declaration or filing with any governmental authority or other
Person.
Restricted Business shall mean the business of providing heavy highway
construction and related services anywhere within the United States; provided,
however, that the term "Restricted Business" shall not include the business of
completing the Retained Contracts.
Retained Contracts has the meaning ascribed to it in the Subcontract
Agreement.
Sellers has the meaning as defined in the preamble of this Agreement.
Sellers' Business has the meaning as defined in the preamble of this
Agreement.
Sellers' Parent has the meaning as defined in the preamble of this
Agreement.
Subcontract Agreement shall mean that certain subcontract agreement in
the form attached hereto as Exhibit F.
Sublease Agreement has the meaning as defined in Section 2.9 of this
Agreement.
Subordinated Note has the meaning as defined in Section 2.4(b) of this
Agreement.
Subordination Agreement shall mean that certain subordination agreement
in the form attached hereto as Exhibit E.
Threatened shall mean a claim, proceeding, dispute, action or other
matter will be deemed to have been "Threatened" if any demand or statement has
been made (verbally or in writing) or any notice has been given (verbally or in
writing) that is with the knowledge of a Person and would lead a prudent Person
to conclude that such a claim, proceeding, dispute, action or other matter is
likely to be asserted, commenced, taken or otherwise pursued in the future.
Tracks of Texas has the meaning as defined in the preamble of this
Agreement.
Transaction shall mean the transaction or transactions contemplated
under this Agreement.
Transaction Documents shall mean this Agreement and all documents,
instruments and agreements to be signed by any of the parties hereto and
delivered in connection with the Closing of the Transaction hereunder, including
without limitation, the Assignment and Assumption
3
Agreement, the Xxxx of Sale, the Special Warranty Deed, the Subcontract
Agreement, the Subordinated Note, the Contract Subordinated Note, the Master
Equipment Sublease and the Limited Joinder and Guaranty of Buyer's Parents and
Sellers' Parent.
Transferred Employees has the meaning as set forth in Section 2.2.
Transferred Employee Costs has the meaning as set forth in Section 2.2.
True-Up Payments shall have the meaning as set forth in Section 5.6(e).
U.S. 59 Contract shall mean the contract between Xxxxxx and the Texas
Department of Transportation relating to the U.S. 59 San Jacinto County project.
U.S. 59 Contract Equipment has the meaning as set forth in Section 2.7.
4
EXHIBIT AND SCHEDULE LIST
Exhibits
Exhibit A - Subordinated Note
Exhibit B - Contract Subordinated Note
Exhibit C - Assignment and Assumption Agreement
Exhibit D - Xxxx of Sale
Exhibit E - Subordination Agreement
Exhibit F - Subcontract Agreement
Exhibit G - Master Equipment Sublease
Exhibit H - Limited Joinder and Guaranty - Sellers' Parent
Exhibit I - Limited Joinder and Guaranty - Buyer's Parents
Schedules
Schedule 2.1 - Equipment Schedule
Schedule 2.2 - Transferred Employee Costs
Schedule 3.2 - Consents and Approvals
Schedule 3.6 - Litigation
Schedule 3.7 - Defaults
