ASSET PURCHASE AGREEMENT
Exhibit 10.12
THIS
ASSET PURCHASE AGREEMENT (the “Agreement”) is effective
as of the 15th day of July, 2019 (the “Effective Date”) as
between COMMAND CENTER,
INC., a Washington corporation, or its successors,
(collectively, “Seller”), and
______________, a_____________________ (“Buyer”). Seller and Buyer
are collectively referenced herein as the “Parties.”
RECITALS
A.
Seller desires to sell to Buyer and Buyer desires to purchase from
Seller, on the terms and subject to the conditions of this
Agreement, all the assets and properties of Seller as specifically
set forth herein regarding Seller’s business operations
located at __________________________, with the exception only of
those assets and properties described in Schedule 2.1 attached to this
Agreement (the “Excluded
Assets”).
B.
Seller is the owner and operator of a staffing business at
__________________________________ and Seller provides temporary
workers in day labor, light industrial, as well as office and
clerical positions.
C.
As Buyer is also in the staffing business, the Parties have agreed
that Buyer will purchase from Seller the Included Assets of the
Purchased Location, as that term is defined herein, under the terms
set forth in this Agreement.
AGREEMENTS
NOW,
THEREFORE, in consideration of the foregoing and the mutual
covenants, conditions, and agreements contained in this Agreement,
and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged by the parties, the
parties to this Agreement hereby agree as follows:
1.
Purchase and
Sale. Subject to the terms and conditions of this Agreement
and with the exception of the Excluded Assets, Seller agrees to
sell, convey, transfer, assign, and deliver to Buyer, and Buyer
agrees to purchase from Seller on the Closing Date, free and clear
of any liens or encumbrances, all of Seller’s right, title
and interest in the business now conducted at the following
physical address: __________________________________ (the
“Purchased
Location”). The assets herein conveyed, transferred,
assigned, and delivered, as provided by this Agreement, include all
rights, title and interest of the assets and property rights, now
owned or hereafter acquired, whether tangible or intangible, which
will include all fixtures, furnishings and equipment; all
inventories, goods and supplies; all telephone listings and
telephone numbers; and all passwords, codes and documentation
needed for use of the same; all transferrable permits, licenses,
franchises and any other authorization obtained from federal, state
or local governments or agencies necessary to operate the Purchased
Location; goodwill of the Purchased Location; all real property
leases and leasehold improvements, including prepaid rent and
deposits; all customer lists and other customer information; all
signs and signage at or within the Purchased Location; assignment
of all contracts requested by Command Center, including employee
contracts, equipment leases, vendor and customer contracts; prepaid
deposits, including lease deposits; and all other assets and
property of every kind and description, all of which are referred
to collectively in this Agreement as the “Included
Assets” provided,
however, that nothing in this Agreement shall be construed
to convey to Buyer any assets of Seller utilized in any locations
other than in the Purchased Location.
The
Assets to be conveyed, transferred, assigned, and delivered as
provided by this Agreement will include the following, which may be
set forth in additional detail in Schedule A of the Xxxx of Sale
attached to this Agreement:
1.1.
Leasehold Interests
in Real Property. All leasehold interests held by Seller in
all land, buildings, structures, fixtures, and other improvements
located on or attached to such leasehold interests and all
easements and other rights, title or interests appurtenant to,
including but not limited to security deposits, reserves or prepaid
rents paid in connection therewith, or owned or used by Seller at
the Purchased Location (“Leasehold Interests”),
including, without limitation, the Leasehold Interests described on
Schedule 1.1
attached to this Agreement;
1.2.
Inventory.
All equipment, materials, work in process, and finished goods
produced or used at the Purchased Location (“Inventory”);
1.3.
Personal
Property. All
equipment, tools, machinery, furniture, computers, telephones,
supplies, materials, and other tangible personal property used in
any manner in connection with the Purchased Location, whether owned
or leased (“Personal
Property”), including, but not limited to all items
listed in the Xxxx of Sale, attached hereto as Exhibit A;
1.4.
Contractual
Rights. As may be
requested by Buyer, any and all rights in any manner related to the
ownership, possession, lease, or use of the Assets or to the
ownership, operation, or conduct of Seller’s business, rights
in or claims under leases, permits, licenses, franchises, purchase
and sales orders, covenants not to compete, and all other contracts
of any nature whatsoever concerning the Purchased Location
(“Contractual
Rights”);
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1.5.
Goodwill.
Goodwill, all tangible and intangible, which relates to the
operation of the Purchased Location and all rights to continue to
use the Assets in the conduct of the going business at the
Purchased Location; and
1.6. Prepaid
Expenses. All prepaid
expenses, credits, advance payments, claims, security, refunds,
rights of recovery, rights of set-off, rights of recoupment,
deposits, charges, sums and fees (including any such item relating
to the payment of any taxes) with respect to the Assets and Assumed
Liabilities subject to the limitations set forth in this
Agreement;
1.7 Customer
Lists and Marketing Materials. All customer and supplier
lists for the Purchased Location, together with all sales and
marketing literature, sales quotes and bids, and catalogues and
brochures of any kind. Notwithstanding anything in this Agreement
to the contrary, Seller shall have the right to access and/or copy
any and all financial or other information as may be necessary or
helpful in any audit of state or federal taxes, workers
compensation, or for any other business purpose.
2.
Excluded Assets;
Assumed Liabilities.
2.1.
Excluded
Assets. Buyer will not assume or be deemed to have purchased
the Excluded Assets set forth on Schedule 2.1 attached to this
Agreement.
2.2.
Assumed
Liabilities. Buyer will not assume or be deemed to have
assumed, or to have any obligations with respect to, any
liabilities or obligations of Seller other than the contracts,
liabilities and obligations specifically assumed pursuant to this
Section 2.2
and specified on Schedule
2.2 (“Assumed
Liabilities”). All liabilities and obligations of
Seller other than those listed on Schedule 2.2 will remain solely
the liabilities and obligations of Seller (the “Retained
Liabilities”).
3.
Purchase Price;
Closing.
3.1.
Purchase
Price. The purchase price for the Assets will be paid by the
assumption of the Assumed Liabilities and by the payment of
____________________________
($_______________) (“Purchase Price”).
3.2.
Payment
of Purchase Price.
3.3.
Allocation of the
Purchase Price. Buyer and Seller agree to cooperate in
reporting the allocation of the Purchase Price as provided on the
attached Schedule
3.3.
3.4.
Closing
Date. The
“Closing
Date” or “Closing” will occur on
July 15, 2019, at 6:00 a.m., EDT, and will take place at the
offices of Seller, at 000 Xxxxxxxxxx Xxxxx, Xxxxx Xxxxx, Xxxxx
Xxxxxxxx, or at such other time and place as the parties may agree
to in writing.
A. Control.
At Closing, upon payment of the Purchase Price to Seller, and
subject to the terms set forth in the Promissory Note, Buyer shall
have sole and unfettered operational control, possession and right
to occupancy of the Assets and the Purchased Location.
B. Deliveries
at Closing. At the Closing: (a) Seller shall deliver to
Buyer the duly executed various agreements, certificates,
instruments and documents referred to in Section 9.1; and
(b) Buyer shall deliver to Seller the duly executed various
agreements, certificates, instruments and documents referred to in
Section 9.2.
C. Risk
and Loss Prior to Closing. Subject to the provisions of
Section 3.4 A, possession and title of the Assets will be given to
Buyer at the Closing, and assumption of the Assumed Liabilities
will occur at the Closing. Buyer will not acquire any title to the
Assets or assume any of the Assumed Liabilities until possession
has been given to it in accordance with this Section 3.4 and
accordingly, all risk and loss with respect to the Assets will be
borne by Seller until possession has been given to Buyer at the
Closing.
3.5.
Payment
of Taxes and Other Charges. Buyer will pay any and all
transaction privilege tax, sales tax, use tax, property tax, income
tax, payroll tax, excise tax, business and occupation tax, or other
transfer fee, tax, charge, or assessment which may be imposed by
any governmental agency with respect to the sale, transfer,
conveyance, and assignment of the Assets and Assumed Liabilities
pursuant to this Agreement.
3.6
Security Deposits,
Rent, and Prepaid Expenses. Buyer authorizes Seller, or
Seller’s subsidiary or affiliate, to deduct from
Buyer’s Franchisee Share (as that term is defined in the
Franchise Agreement) an amount equal all security deposits paid by
Seller and held by any landlord of the premises subject to the
Leasehold Interests and an amount to cover the rent prepaid by
Seller for the portion of any month after the Closing including,
without limitation, payments for the last month’s rent. Buyer
further authorizes Seller or Seller’s subsidiary or affiliate
to deduct from Buyer’s Franchisee Share an amount equal to
all Prepaid Expenses as defined in paragraph 1.6
hereof.
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4.
Conditions to
Obligation of Buyer to Perform. The obligation of Buyer to
purchase the Assets and assume the Assumed Liabilities from Seller
at the Closing is subject to the satisfaction, on or before the
Closing Date, of all of the following conditions precedent, any or
all of which may be waived by Buyer by delivery to Seller of a
written notice of such waiver:
4.1
Approval.
Seller shall have obtained approval from its Board of Directors
authorizing it to enter into this Agreement and to consummate the
transactions contemplated hereby;
4.2
Representations and
Warranties True on the Closing Date. The representations and
warranties of Seller contained in this Agreement, in the exhibits
and schedules attached hereto, or in any certificate, document, or
statement delivered pursuant to the provisions hereof, will be true
and correct on and as of the Closing Date as though such
representations and warranties were made on and as of the Closing
Date;
4.3.
Compliance with
Agreement. Seller will have performed and complied with all
agreements, covenants, conditions, and obligations required by this
Agreement prior to or on the Closing Date;
4.4.
Third
Party Consents. Seller will have obtained all consents,
waivers, permits, approvals, and authorizations and completed all
filings or registrations required and will have delivered executed
copies or other written evidence thereof to Buyer;
4.5.
Transfer of
Licenses. Except as contained within Schedule 2.1, Seller will have
transferred or assigned to Buyer on or before the Closing Date all
licenses, permits, franchises, certificates, and authorizations
which are transferable or assignable and which are required or
necessary to enable Buyer to operate and conduct Seller’s
Business in the manner in which Seller currently operates and
conducts its business; and
4.6.
Assignment of
Warranties. Seller will assign to Buyer any and all
warranties covering or affecting the Personal Property or
Inventory.
5.
Conditions to
Obligation of Seller to Perform. The obligation of Seller to
sell the Assets at the Closing is subject to the satisfaction, on
or before the Closing Date, of all of the following conditions
precedent, any or all of which may be waived by Seller by delivery
to Buyer of a written notice of such waiver:
5.1.
Representations and
Warranties True on the Closing Date. The representations and
warranties of Buyer contained in this Agreement, in the exhibits
and schedules attached hereto, or in any certificate, document, or
statement delivered pursuant to the provisions hereof, will be true
and correct on and as of the Closing Date as though such
representations and warranties were made on and as of the Closing
Date;
5.2. Compliance
with Agreement. Buyer will have performed and complied with
all agreements, covenants, conditions, and obligations required by
this Agreement prior to or on the Closing Date;
5.3. Franchise
Agreement.
Buyer will have duly executed and delivered a franchise agreement
(the “Franchise Agreement”) in a form agreed to by the
parties, allowing Buyer to operate the Purchased Location as a
franchise of Seller. Buyer will also have executed and delivered
any and all documents required of the Franchise Agreement,
including but not limited to any required non-competition or
non-solicitation agreements;
5.4.
Assignment of
Leases. The Assignment and Assumption of Lease and Landlord
Consent Agreement attached hereto in Exhibit B shall have been duly
executed;
5.5
Merger
with Hire Quest Holdings, LLC. The mergers contemplated by
and more accurately described in that certain Agreement and Plan of
Merger dated April 8, 2019 by and among Hire Quest Holdings, LLC,
Command Center, Inc., CCNI One, Inc., Command Florida, LLC, and
Xxxxxxx Xxxxxxxx, as Member Representative, (the “Merger
Agreement”) shall have been completed to the sole
satisfaction of Seller; and
5.6
Deliveries.
Buyer shall have delivered or caused delivery of executed copies of
all documents and agreements called for in this Agreement
including, without limitation, those agreements attached as
Exhibits B and D hereto.
6.
Representations and
Warranties of Seller. Seller represents and warrants to
Buyer that, as of the Effective Date and as of the Closing the
following are true and accurate:
6.1.
Organization and
Standing. Seller is a corporation duly organized, validly
existing, and in good standing under the laws of the State in which
it is organized. Seller is qualified to do business as a foreign
corporation under the laws of each jurisdiction where Seller
conducts its business outside of its state of incorporation,
including at the locations of the Purchased Location. Seller has
the requisite corporate power and authority to own, lease, and
operate its properties and is duly authorized and licensed to carry
on its businesses in the places where, and in the manner in which,
such business is presently being conducted, including the Purchased
Location.
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6.2.
Capacity.
Seller has full corporate power, legal capacity, and authority to
execute and deliver this Agreement, to consummate the transactions
contemplated hereby, and to perform its obligations under this
Agreement. The execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby, and the
performance of Seller’s obligations under this Agreement have
been duly authorized by Seller’s Board of Directors and no
other corporate proceedings on the part of the Seller are necessary
in connection therewith. This Agreement constitutes, and each other
agreement or instrument to be executed and delivered by Seller in
connection with this Agreement will constitute, valid and binding
obligations of Seller, enforceable against Seller in accordance
with their respective terms.
6.3.
Authority.
Neither the execution and delivery of this Agreement by Seller, the
consummation of the transactions contemplated hereby, nor the
performance of Seller’s obligations hereunder will: (a)
violate any provisions of the Articles of Incorporation or Bylaws
of Seller; (b) violate any statute, code, ordinance, rule, or
regulation of any jurisdiction applicable to Seller or the Assets
or Assumed Liabilities or the business operations at the Purchased
Location; (c) violate any judgment, order, writ, decree,
injunction, or award of any court, arbitrator, mediator,
government, or governmental agency or instrumentality, which is
binding upon Seller or which would have an adverse effect on the
Assets or Assumed Liabilities or the business operations at the
Purchased Location; or (d) violate, breach, conflict with,
constitute a default under (whether with or without notice or lapse
of time, or both), result in termination of, or accelerate the
performance required by, any of the terms, conditions, or
provisions of any note, bond, mortgage, indenture, deed of trust,
license, lease, agreement, or other instrument or obligation to
which Seller is a party or by which Seller, the Assets or Assumed
Liabilities, or the Purchased Location are bound.
6.4.
Consents.
No consents, approvals, filings, or registrations with or by any
federal, state, or local court, administrative agency or commission
or other governmental authority or instrumentality, whether
domestic or foreign (each a “Governmental Entity”) or
any other person or entity are necessary in connection with the
execution and delivery by Seller of this Agreement, the
consummation by Seller of the transactions contemplated hereby, or
the performance of Seller’s obligations under this
Agreement.
6.5.
Absence
of Defaults. Seller
is not in default under, or in violation of, any provision of its
Articles of Incorporation or Bylaws or any indenture, mortgage,
deed of trust, loan agreement, or similar debt instrument, or any
other agreement to which Seller is a party or by which Seller is
bound or to which any of their properties are subject, nor is
Seller aware of any fact, circumstance, or event that has occurred
which, upon notice, lapse of time, or both, would constitute such a
default or violation. Seller is not in violation of any statute,
rule, regulation, or order of any Governmental Entity having
jurisdiction over Seller or any of its properties, including the
Purchased Location.
6.6.
Financial
Statements. The following documents are attached hereto as
Exhibit C:
unaudited statements of the Seller’s income and expenses for
the Purchased Location for the twelve-months ended March 29, 2019
(collectively referred to as “Financial Statements”).
The Financial Statements do not contain any untrue statement of
material fact or omit to state any material fact necessary to make
the statements or information therein not misleading. The Financial
Statements have not been prepared in accordance with United States
generally accepted accounting principles (“GAAP”), applied on a
consistent basis for the periods indicated, and each of the
Financial Statements is a compilation of the books and records of
the Seller.
6.7.
Absence
of Specified Changes. As regards Seller’s business
operations at each of the Purchased Location, from March 31, 2019,
through the Closing Date there has not been any:
A. Transactions
by Seller except in the ordinary course of business;
B. Capital
expenditures by Seller exceeding $15,000;
C. Materially
adverse change in the Assets, the financial condition, liabilities,
business, operations, or prospects of the Purchased
Location;
D. Destruction,
material damage to, or loss of any of the Assets (whether or not
covered by insurance) that adversely affects the financial
condition, business, operations, or prospects of the Purchased
Location;
E. Acquisition
or disposition of any of the Assets, except in the ordinary course
of business;
F. Amendment
or termination of any contract, agreement, or license to which
Seller is a party, except in the ordinary course of
business;
G. Waiver
or release of any right or claim of Seller, except in the ordinary
course of business;
H. Other
event or condition of any character that has or might have a
materially adverse effect on the Assets, or the financial
condition, business operations, or prospects of Seller’s
operations at the Purchased Location;
I. Incurrence
of any liability or obligation (whether absolute, accrued, or
contingent) affecting the Seller’s operations at the
Purchased Location or the Assets; or
J. Agreement
or any action or omission by Seller that would result in any of the
things described in the preceding Subsections A. through J.,
inclusive.
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6.8.
Litigation and
Claims. Seller is not a party to any, and there are no
pending or threatened, suit, action, arbitration, legal,
administrative, or other proceeding or governmental investigation
against Seller that will, may or could affect the Assets or the
business operations at the Purchased Location. To the best of
Seller’s knowledge, there is no basis for the assertion of
any such proceeding, claim, action, or governmental investigation
that could affect the Assets or Seller’s ability to transfer
the Assets to Buyer. No event has occurred or circumstances exist
that may give rise to, or serve as a basis for, any such actions.
Seller is not a party to any judgment or decree, nor is Seller in
default with respect to any order, writ, injunction, or decree of
any federal, state, local, or foreign court, department, agency, or
instrumentality which will, or is likely to, affect the Assets,
Seller’s title thereto, the ability of Seller to perform its
obligations under this Agreement, or the business operations at the
Purchased Location. No event has occurred or circumstances exist
that may constitute or result in (with or without notice or lapse
of time) a violation of any governmental orders respecting the
Purchased Location.
6.9.
Compliance with
Laws. Seller is in
compliance with and not in default under any applicable foreign,
federal, state, and local statutes, regulations, ordinances, zoning
laws, engineering standards, safety standards, environmental
standards, and any other applicable laws in connection with the
ownership and use of the Assets and the conduct and operations at
the Purchased Location. Seller holds all required franchises,
permits, licenses, certificates, and authorizations necessary or
appropriate in connection with the ownership and use of the Assets
and the conduct and operations at the Purchased Location, and all
are current and valid as of the Effective Date and the Closing
Date. All required fees and charges with respect to such permits,
licenses, franchises, certificates or authorizations have been paid
in full. No event has occurred that, with or without notice or
lapse of time or both, would reasonably be expected to result in
the revocation, suspension, lapse or limitation of any permits,
licenses, franchises, certificates or authorizations.
6.10.
Title
to Assets. Seller will convey at Closing good and marketable
title to the Assets, free and clear of all liens, deeds of trust,
mortgages, pledges, charges, security interests, encumbrances,
claims, conditional sales agreements, easements, licenses,
rights-of-way, covenants, conditions, restrictions on transfer, or
other restrictions or other rights of third parties. All Assets are
adequate for their intended use, in good operating condition and
repair, reasonable wear and tear excepted, and are sufficient for
the conduct of the Seller’s business operations at the
Purchased Location as currently conducted and as proposed to be
conducted up to the Closing.
6.11.
Leasehold
Interests. Seller’s representations, warranties, and
statements regarding the Leasehold Interests are complete, current,
and accurate, do not contain or will not contain any untrue
statement of material fact, and do not omit or will not omit to
state any fact necessary to make each such representation,
warranty, or statement accurate and not misleading in any material
respect. As to the Leasehold Interests: (a) all leases under which
the Seller leases any real property (the “Real Property Leases”)
are valid and in full force and effect and constitute binding
obligations of the Seller and the counterparties thereto, and
Seller enjoys peaceful and undisturbed possession of the Real
Property Leases, in accordance with their respective terms; (b)
there are not any existing defaults by Seller under any of the Real
Property Leases that would give the lessor under such Real Property
Lease the right to terminate such Real Property Lease or amend or
modify such Real Property Lease in a manner adverse to Seller or
Buyer (after Closing); (c) no event has occurred which, after
notice or lapse of time or both, would constitute a default by
Seller under any Real Property Lease, where such default if uncured
would give the lessor under such Real Property Lease the right to
terminate such Real Property Lease or amend or modify such Real
Property Lease in a manner adverse to the Seller or Buyer (after
Closing); (d) Seller has not subleased, assigned or otherwise
granted to any person the right to use or occupy such Real Property
Leases or any portion thereof; and (e) Seller will convey all Real
Property Leases free of pledges, mortgages or other encumbrances on
all leasehold interests in any Real Property Lease.
6.12.
Brokers.
No broker or finder has acted for Seller in connection with this
Agreement or the transactions contemplated hereby and no broker or
finder is entitled to any brokerage commissions, finder’s
fee, or other compensation based on agreements or arrangements made
by Seller.
6.13.
Taxes.
6.14.
Full
Disclosure. The representations, warranties, and statements
of Seller in this Agreement, in any exhibit or schedule attached
hereto, or in any certificate or other document furnished by Seller
to Buyer pursuant to this Agreement are complete, current, and
accurate, do not contain or will not contain any untrue statement
of material fact, and do not omit or will not omit to state any
material fact necessary to make each representation, warranty, or
statement accurate and not misleading in any material respect.
Seller has, and prior to Closing will have, provided to Buyer, in
writing, any information necessary to ensure that all
representations, warranties, or statements made by Seller to Buyer
are complete, current, and accurate and are not misleading in any
material respect.
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7.
Representations and
Warranties of Buyer. Buyer represents and warrants to Seller
that, as of the Effective Date and as of the Closing
Date:
7.1.
Organization and
Standing. Buyer is a limited liability company duly
organized, validly existing, and in good standing under the laws of
the State of Florida. Buyer has the requisite power and authority
to own, lease, and operate its properties and is duly authorized
and licensed to carry on its business in the places where and in
the manner in which its business is presently being conducted )if
any) and, in particular, where the Assets and the Purchased
Location are located.
7.2.
Capacity.
Buyer has full corporate power, legal capacity, and authority to
execute and deliver this Agreement, to consummate the transactions
contemplated hereby, and to perform its obligations under this
Agreement. The execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby, and the
performance of Buyer’s obligations under this Agreement have
been duly authorized by the members or shareholders of Buyer, and
no other corporate proceedings on the part of Buyer are necessary
in connection therewith. This Agreement constitutes, and each other
agreement or instrument to be executed and delivered by Buyer in
connection with this Agreement will constitute valid and binding
obligations of Buyer, enforceable against Buyer in accordance with
their respective terms.
7.3.
Authority.
Neither the execution and delivery of this Agreement by Buyer, the
consummation of the transactions contemplated hereby, nor the
performance of Buyer’s obligations hereunder will: (a)
violate any provision of the Articles of Incorporation, Operating
Agreements or Bylaws of Buyer; (b) violate any statute, code,
ordinance, rule, or regulation of any jurisdiction applicable to
Buyer, or its properties or assets; (c) violate any judgment,
order, writ, decree, injunction, or award of any court, arbitrator,
mediator, government, or governmental agency or instrumentality,
which is binding upon Buyer or which would have an adverse effect
on its properties or assets; or (d) violate, breach, conflict with,
constitute a default under, result in termination of, or accelerate
the performance required by, any of the terms, conditions, or
provisions of any note, bond, mortgage, indenture, deed of trust,
license, lease, agreement, or other instrument or obligation to
which Buyer is a party or by which Buyer or any of its properties
or assets is bound.
7.4.
Consents.
No consents, approvals, filings, or registrations with or by any
governmental agency or instrumentality or any other person or
entity are necessary in connection with the execution and delivery
by Buyer of this Agreement, the consummation by Buyer of the
transactions contemplated hereby, or the performance of
Buyer’s obligations under this Agreement.
7.5.
Absence
of Defaults. Buyer is
not in default under, or in violation of, any provision of its
Articles of Incorporation, or Operating Agreement or Bylaws or any
indenture, mortgage, deed of trust, loan agreement, or similar debt
instrument, or any other agreement to which Buyer is a party or by
which Buyer is bound or to which any of their properties or assets
are subject, nor is Buyer aware of any fact, circumstance, or event
that has occurred which, upon notice, lapse of time, or both, would
constitute such a default or violation. Buyer is not in violation
of any statute, rule, regulation, or order of any Governmental
Entity having jurisdiction over Buyer or any of its properties or
assets.
7.6.
Compliance with
Laws. Buyer is in
compliance with and not in default under any applicable foreign,
federal, state, and local statutes, regulations, ordinances, zoning
laws, engineering standards, safety standards, environmental
standards, and any other applicable laws in connection with the
prospective ownership and use of the Assets and the conduct and
operations at the Purchased Location. Buyer holds (or at the
Closing Date will hold) all required franchises, permits, licenses,
certificates, and authorizations necessary or appropriate in
connection with the ownership and use of the Assets and the conduct
and operations at the Purchased Location. All required fees and
charges with respect to such permits, licenses, franchises,
certificates or authorizations have been paid in full or will be
paid in full as of the Closing Date. No event has occurred that,
with or without notice or lapse of time or both, would reasonably
be expected to result in the revocation, suspension, lapse or
limitation of any permits, licenses, franchises, certificates or
authorizations required to own, use and operate the Assets and the
business at the Purchased Location.
7.7.
Brokers.
No broker or finder has acted for Buyer in connection with this
Agreement or the transactions contemplated hereby and no broker or
finder is entitled to any brokerage commissions, finder’s
fee, or other compensation based on agreements or arrangements made
by Buyer.
7.8.
Tax
Consequences. Buyer represents
that it has consulted with a qualified attorney, tax advisor, or
accountant and assumes the risk of all potential income tax risks
associated with the transactions contemplated by this
Agreement.
7.9.
Full
Disclosure. The representations, warranties, and statements
of Buyer in this Agreement, in any exhibit or schedule attached
hereto, or in any certificate or other document furnished by Buyer
to Seller pursuant to this Agreement are complete, current, and
accurate, do not contain or will not contain any untrue statement
of material fact, and do not omit or will not omit to state any
material fact necessary to make each representation, warranty, or
statement accurate and not misleading in any material
respect.
7.10
Due
Diligence. Buyer warrants and represents that it has had
adequate time to conduct and complete its due diligence and has
been given access to all information that it requested during its
due diligence with respect to the terms and obligations contained
in this Agreement and its purchase of the Purchased Location. Buyer
is satisfied with the results of such due diligence.
6
8.
Obligations at
Closing.
8.1.
Seller’s
Obligations at Closing. At the Closing, Seller will deliver
or cause to be delivered to Buyer the following:
A.
All instruments of transfer (to the extent required to transfer
such rights), properly executed by Seller and acknowledged,
including, but not limited to, a xxxx of sale, deeds, and
assignments, transferring and assigning to Buyer all of
Seller’s rights, title, and interest in and to the Assets and
Assumed Liabilities, including, but not necessarily limited to, the
following:
(1)
Xxxx of Sale in a form substantially identical to Exhibit A attached to this
Agreement;
(2)
Assignment and Assumption of Leases for each of the Purchased
Location offices of Seller in a form substantially identical to
Exhibit B attached
to this Agreement;
(3)
Assignment and Assumption Agreement in a form substantially
identical to Exhibit
D attached to this Agreement;
B.
All instruments evidencing any and all consents, waivers, permits,
approvals, authorizations, filings, or registrations as provided
for in this Agreement;
C.
All keys, items or information that provide access the property,
offices or any personal property of or related to the Assets,
including security cards, security codes, passwords or any other
item or information necessary or required to access, operate or
possess any of the Assets or the Purchased Location;
D.
At the time of closing, Seller agrees to transfer to Buyer all of
Seller’s right, title and interest in and to the telephone
lines, cell phone numbers, facsimile lines, listings and numbers
presently assigned to the Assets at the Purchased Location, which
are the subject of this sale, including specifically, but not
limited to, the telephone numbers, facsimile number and mobile
telephone numbers stated in in Schedule A of the Xxxx of Sale
attached to this Agreement. Seller agrees to execute any necessary
documents and to cooperate fully with Buyer in accomplishing the
transfer of the aforesaid telephone numbers to Buyer;
and
E. All
material agreements and covenants required by this Agreement to be
performed or complied with by the Seller on or prior to the Closing
Date.
8.2.
Buyer’s
Obligation at Closing. On the Closing Date, Buyer will
deliver or cause to be delivered to Seller the
following:
A.
All instruments of transfer (to the extent required to transfer
such rights), properly executed by Buyer and acknowledged,
including, but not limited to, a xxxx of sale, deeds, and
assignments, transferring and assigning to Buyer all of
Seller’s rights, title, and interest in and to the Assets and
Assumed Liabilities, including, but not necessarily limited to, the
following:
(1)
Xxxx of Sale in a form substantially identical to Exhibit A attached to this
Agreement;
(2)
Assignment and Assumption of Leases for each of the Purchased
Location offices of Seller in a form substantially identical to
Exhibit B attached
to this Agreement;
(3)
Assignment and Assumption Agreement in a form substantially
identical to Exhibit
D attached to this Agreement;
B.
The duly executed Promissory Note for the amount of the Purchase
Price as set forth in Section 3, which is then deliverable to
Seller in terms set forth in the Promissory Note;
C.
The duly executed Franchise Agreement; and
D.
Executed resolutions of Buyer’s Board of Directors, members,
or governing body authorizing the execution and performance of this
Agreement and all actions taken by Buyer in furtherance of this
Agreement along with a certificate executed as of the Closing by a
duly authorized officer of Buyer certifying the accuracy of said
resolution and the representations and warranties made by Buyer in
this Agreement.
7
9.
Obligations After
Closing.
9.1.
Buyer’s
Indemnification.
A.
Buyer agrees to indemnify and hold Seller and its officers,
directors, employees, members, managers, and successors and any
subsidiaries thereof (collectively, the “Seller Indemnified
Parties”) harmless for, from, and against any and all
damages, of any kind, including, without limitation, costs of
investigation, interest, penalties, reasonable attorneys’
fees, and any and all costs, expenses, and fees incident to any
suit, action, or proceeding, incurred or sustained by Seller
Indemnified Parties, which arise out of, result from, or are
related to: (a) any inaccuracy in or omission or Buyer’s
breach or non-fulfillment of any representation, warranty,
condition, agreement, or covenant contained in this Agreement; (b)
any and all liabilities or obligations relating to the operation of
Buyer’s business after the Closing Date, including, without
limitation, all tax liabilities, liabilities for breach of
contract, liabilities arising in tort, liabilities for materials
sold or services rendered, payroll liabilities and liabilities to
any creditors, or third parties, except to the extent such
liabilities or obligations have been expressly excluded by Buyer in
writing pursuant to this Agreement; and (c) any damages, costs,
penalties and attorneys’ fees incurred due to the loss,
damage or destruction of the paper business records presently
located at each of the Purchased Location.
B.
Seller agrees that, upon the receipt of a third-party claim in
respect of which indemnity may be sought under this Section 9.2
Seller will give written notice within ten (10) days of such claim
(the “Seller’s
Notice of Claim”) to Buyer. Seller will be entitled,
at its own expense, to participate in the defense of any such claim
or action against Buyer. Buyer will have the right to assume the
entire defense of such claim, provided that: (a) Buyer gives
written notice of its desire to defend such claim (the
“Seller’s
Notice of Defense”) to Seller within 15 days after
Seller’s receipt (either individually or collectively) of the
Seller’s Notice of Claim; (b) Buyer’s defense of such
claim will be without cost of Seller or prejudice to Seller’s
rights under this Section
9.2; (c) counsel chosen by Buyer to defend such claim will
be reasonably acceptable to Seller; (d) Buyer will bear all costs
and expenses in connection with the defense of such claim; (e)
Seller will have the right, at Seller’s expense, to have
Seller’s counsel participate in the defense of such claim;
and (f) Seller will have the right to receive periodic reports from
Buyer and Buyer’s counsel with respect to the status and
details of the defense of such claim and will have the right to
make direct inquiries to Seller’s counsel in this
regard.
C.
This Section 9.1 shall survive any termination of this
Agreement.
9.2.
Utilities.
Buyer and Seller will cooperate to take all steps necessary to
transfer all utilities and services related to the operation and
conduct of business at the Purchased Location, including, without
limitation, electric service, gas service, telephone service,
sewage, water, and trash removal, into Buyer’s name effective
as of the Closing Date; provided, however, that Buyer will pay for
any new deposits or connection fees required.
9.3.
Seller’s
Records.
A.
Buyer will keep and maintain all of Seller’s paper files,
records and archives presently within the Purchased Location,
including Forms I-9, work tickets, employee applications, etc., and
all shall be maintained in their present form and condition and
safe from damage or loss for 36 months from the Closing Date.
Seller shall have free access to such files upon reasonable notice
in order to make copies or digital copies. Thereafter, Buyer shall
dispose of all such files and records by a method ensuring the
records will be destroyed without release into the general
public.
B.
Buyer will specifically indemnify Seller for any damages, costs,
penalties and attorneys’ fees incurred due to the loss,
damage or destruction of the paper business records presently
located at each of the Purchased Location.
9.4.
Transition.
Seller will maintain the goodwill of Seller’s suppliers,
customers, and business, and will otherwise cooperate with Buyer to
effectuate a smooth and orderly transition in the operation and
conduct of the business at the Purchased Location following the
Closing Date.
10.
Remedies.
10.1.
Remedies Prior to
or on Closing.
A. In
the event of any material breach or default of any representation,
warranty, covenant, agreement, condition, or other obligation of
Seller under this Agreement which Seller does not cure within ten
(10) business days after actual receipt of written notice from
Buyer, Buyer may, at its option, and without prejudice to any
rights or remedies Buyer may have at law or in equity for any such
breach or default, terminate this Agreement by delivering written
notice of termination to Seller. The notice will specify the
material breach or default.
B. In
the event of any material breach or default of any representation,
warranty, covenant, agreement, condition, or other obligation of
Buyer under this Agreement which Buyer does not cure within ten
(10) business days after actual receipt of written notice from
Seller, Seller may, at its option, and without prejudice to any
rights or remedies Seller may have at law or in equity for any such
breach or default, terminate this Agreement by delivering written
notice of termination to Buyer. The notice will specify the
material breach, or default.
C.
In the event of termination of this Agreement by either Buyer or
Seller as provided in this Section 10.1, this Agreement
will become null and void.
10.2.
Remedies Subsequent
to Closing. In the event of any breach or default of any
representation, warranty, covenant, agreement, condition, or other
obligation by either party to this Agreement, the non-defaulting
party may pursue whatever rights and remedies are available to such
party at law or in equity, including, without limitation, the
rights and remedies provided in this Agreement.
8
11.
General
Provisions.
11.1.
Expenses.
Except as otherwise specifically provided in this Agreement, each
party will be responsible for its own fees, costs, and other
expenses incurred in negotiating and preparing this Agreement and
in closing and carrying out the transactions contemplated
hereunder, including the fees and expenses of its counsel and other
advisors.
11.2.
Survival of
Representations, Warranties, and Covenants. The respective
representations, warranties, and covenants of Buyer and Seller made
in this Agreement or in any certificate or other document delivered
pursuant to this Agreement, including, without limitation, the
obligations of indemnity hereunder, will survive the Closing Date,
and the consummation of the transactions contemplated hereby, until
the applicable statute of limitations has run, notwithstanding any
examination made by or for the party to whom such representations,
warranties, or covenants were made, the knowledge of any officers,
directors, shareholders, employees, or agents of the party, or the
acceptance of any certificate or opinion.
11.3.
Notices. All
notices, requests, demands, and other communications required under
this Agreement will be in writing and will be deemed duly given and
received: (a) when delivered
in person;
(b) upon confirmation of receipt
when transmitted by electronic mail (but, in the case of electronic
mail, only if followed by transmittal by national overnight courier
or hand for delivery on the next Business Day); (c) upon receipt after dispatch by registered or
certified mail, postage prepaid; or (d) on the next Business Day if transmitted by national overnight courier (with
confirmation of delivery), in each case, addressed as
follows:
|
If
to Seller:
|
COMMAND CENTER,
INC.
000
Xxxxxxxxxx Xxxxx
Xxxxx Xxxxx, Xxxxx
Xxxxxxxx 00000
|
|
If
to Buyer:
|
_____________________________
_____________________________
_______________________________
|
Any
party may change its above-designated address by giving the other
party written notice of such change in the manner set forth
herein.
11.4.
Headings.
Headings contained in this Agreement are inserted only as a matter
of convenience and in no way define, limit, extend, or describe the
scope of this Agreement or of any provision hereof.
11.5.
Entire
Agreement; Modification. This Agreement constitutes the
entire agreement among the parties and supersedes all prior and
contemporaneous agreements and undertakings of the parties with
respect to the sale and purchase of the Purchased Location. No
supplement, modification, or amendment of this Agreement will be
binding and enforceable unless executed in writing by the parties
hereto. Nothing in this
Agreement, express or implied, shall
confer upon any other person any rights, benefits or remedies of any nature
whatsoever under or by reason of this Agreement.
11.6.
Waiver.
No waiver of any of the provisions of this Agreement will be
deemed, or will constitute, a waiver of any other provision hereof
(whether or not similar) nor will such waiver constitute a
continuing waiver, and no waiver will be binding unless executed in
writing by the party making the waiver.
11.7.
Exhibits,
Schedules, and Recitals. The Exhibits and Schedules attached
to this Agreement and the Recitals set forth above are hereby
incorporated into and made a part of this Agreement.
11.8.
Counterparts.
This Agreement may be executed in one or more counterparts, each of
which will be deemed an original, but all of which will constitute
one and the same instrument.
11.9.
Governing Law;
Jurisdiction; Dispute Resolution. Except as expressly
provided herein, this Agreement will be construed in accordance
with, and governed by, the laws of the State of South Carolina,
without regard to the application of conflicts of law principles.
Except in respect of an action commenced by a third party in
another jurisdiction, the parties agree that any legal suit,
action, or proceeding arising out of or relating to this Agreement
must be instituted in a state or federal court in Berkeley County,
State of South Carolina, and they hereby irrevocably submit to the
jurisdiction of any such court.
9
11.10
Waiver
of Jury Trial. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY AND ALL RIGHT
SUCH PARTY MAY HAVE TO TRIAL BY JURY IN ANY LEGAL ACTION, SUIT OR
PROCEEDING BETWEEN THE PARTIES HERETO ARISING OUT OF, BASED UPON OR
RELATING TO THIS AGREEMENT OR THE NEGOTIATION, EXECUTION OR
PERFORMANCE HEREOF. THIS WAIVER SHALL SURVIVE TERMINATION OF THE
AGREEMENT.
11.11. Attorneys’
Fees. In the event an action or suit is brought by any party
hereto to enforce the terms of this Agreement, the prevailing party
will be entitled to the payment of its reasonable attorneys’
fees and costs, incurred in connection with such action, including
any appeal of such action.
11.12.
Parties
in Interest. Except
as expressly provided below, nothing in this Agreement is intended
to confer upon any person other than the parties to this Agreement,
their respective heirs, representatives, successors, and permitted
assigns, any rights or remedies under or by reason of this
Agreement, nor is anything in this Agreement intended to relieve or
discharge the liability of any party to this Agreement, nor will
any provision of this Agreement give any entity any right of
subrogation against or action over or against any
party.
11.13.
Successors in
Interest. Except as otherwise provided herein, all
provisions of this Agreement will be binding upon, inure to the
benefit of, and be enforceable by and against the respective heirs,
executors, administrators, personal representatives, successors,
and assigns of any of the parties to this Agreement.
11.14. Severability.
The invalidity or unenforceability of any particular provision, or
any part thereof, of this Agreement will not affect the other
provisions hereof and this Agreement will be continued in all
respects as if such invalid or unenforceable provision were
omitted. Upon a determination that any term or other provision of
this Agreement is invalid, illegal or incapable of being enforced,
the Parties shall negotiate in good faith to modify this Agreement
so as to effect the original intent of the Parties as closely as
possible in an acceptable manner to the end that the transactions
contemplated hereby are fulfilled to the greatest extent
possible.
11.15.
Further
Documentation. Each
party will execute and deliver such further instruments and
documents and do such further acts and things as may be required to
carry out the intent and purpose of this Agreement.
11.16.
Counsel
Review. The parties hereto acknowledge and agree that each
has had the opportunity to have this Agreement and all of its
Exhibits and Schedules reviewed by counsel and the parties have
participated equally in the final wording of this Agreement and its
Exhibits and Schedules. In the event of any dispute regarding the
meaning of any of the terms contained herein or in the Exhibits and
Schedules, such terms shall not be construed against either party
on account of its being the primary drafter.
11.17. Assignment.
Buyer shall not assign its rights, interests, or obligations under
this Agreement without prior written consent of Seller.
Seller shall not assign its rights,
interests, or obligations under this Agreement to any
non-affiliated entity without prior written consent of Buyer. No
assignment by any party shall
relieve such party of any of
its obligations hereunder.
Subject to the foregoing, this Agreement will be binding upon, inure to the benefit of and
be enforceable by the parties and their respective successors and permitted
assigns.
11.18. Name
Change and Redomestication. The Parties acknowledge and
agree that, in connection with the mergers contemplated by the
Merger Agreement, Seller may change its name, state of
incorporation, or other aspects of its corporate
being.
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IN
WITNESS WHEREOF, the parties hereto have executed this Asset
Purchase Agreement on July 15, 2019.
SELLER:
COMMAND
CENTER, INC.
By:
_______________________
Name:
Title:
BUYER:
____________________________
By:
_________________________
Name:
Title:
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