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ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT is made and entered into as of the _____
day of October, 1998, by and among GLOBAL TURBINE SERVICES, INC. and TURBINE
INSPECTIONS, INCORPORATED, Florida corporations (collectively "Seller"), and
AMERICAN AIRCARRIERS SUPPORT ACQUISITION CORP., a Florida subsidiary of American
Aircarriers Support, Incorporated ("Purchaser").
W I T N E S S E T H:
WHEREAS, the Seller is engaged in the business of supplying and
redistribution of aircraft engine parts and engines to commercial and cargo
airlines, maintenance and repair facilities and other redistributors, as well as
management of aircraft engine programs for commercial and cargo airlines.
WHEREAS, the Seller desires to sell and the Purchaser desires to
purchase substantially all the operating assets and properties used in the
business operations of Seller.
NOW, THEREFORE, the parties hereto agree that the purpose of this
Agreement is to set forth the terms and conditions upon which the Seller has
agreed to sell to the Purchaser certain of its business and assets; and the
Purchaser has agreed to purchase and pay for such business and assets; and
furthermore, the Seller and the Purchaser in consideration of the premises and
the mutual agreements contained herein, do hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF ASSETS
Section 1.1 Assets to be Purchased and Sold.
(a) Description of Assets. At the Closing (as defined in Section 1.2),
the Seller shall sell and convey to the Purchaser, and the Purchaser shall
purchase and acquire from the Seller, all equipment, furniture, fixtures and
inventory that are directly associated or connected with the operation of the
Seller's business. The operating assets of the Seller to be purchased hereunder
(which shall not include the Excluded Assets) are referred to herein as the
"Subject Assets," and shall include without limitation:
(i) all the Seller's inventory, which shall include, but not
be limited to, the Varig engine parts, Corsair inventory; and
miscellaneous JT-8 inventory;
(ii) all furniture, fixtures, furnishings, tools, equipment,
supplies, parts, accessories, inventories, machinery, shelving,
computer equipment, signage, and other tangible personal property of
the Seller including the
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Borescope in each of its business locations other than Excluded Assets
(the "Tangible Property"), and any additions or accessions thereto or
substitutions therefor or proceeds thereof, whether currently on the
books or used by Seller;
(iii) Boeing Engine 633682;
(iv) the Seller's interest in Joint Venture #1;
(v) the Seller's interest in Joint Venture #2;
(vi) All accounts receivables owned by Seller at Closing;
(vii) All tradenames, trademarks, service marks, copyrights,
licenses, patents and registrations thereof or applications therefor,
and trade secrets, secret processes (whether or not patentable),
suppliers and vendor lists, customer lists, parts libraries and
manuals, software, inventions (whether or not patentable), formulae and
other property belonging to, used in and appertaining to the Seller's
Subject Assets (collectively the "Intellectual Property");
(viii) All vehicles owned by Seller at Closing, except for
those set forth in the Excluded Assets;
(ix) All of the Seller's work in process; and
(x) All the Seller's federal, state and local government
permits, licenses and approvals required for the conduct of its
business (or held with respect to the assets and operations of the
business of the Seller) to the extent assignment thereof to the
Purchaser is permitted by applicable law.
(b) Excluded Assets. The assets to be purchased and sold hereunder, and
the term "Subject Assets" as used herein, shall not include the following assets
of the Seller existing on the Closing Date (the "Excluded Assets"):
(i) Cash;
(ii) 1998 Navigator; and
(iii) Airplane (1958 Aerocommander 500).
(c) Consignment Agreement. Separately from this Agreement, Seller shall
enter a consignment of his ASAP inventory under the terms of the Consignment
Agreement set forth in Exhibit 1.1(c).
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Section 1.2 Closing Date. The closing date (the "Closing Date") shall
be October 1, 1998, or such other date as may be mutually agreed to by the
parties. The closing of this transaction (the "Closing") shall be held at the
offices of Xxxxx X. Furr, Gray, Layton, Kersh, Solomon, Sigmon, Xxxx & Xxxxx,
P.A., Gastonia, North Carolina, or such other place as the parties may mutually
agree. At the Closing, subject to the fulfillment or waiver of the conditions
set forth in Article V, the Seller shall convey the Subject Assets to the
Purchaser by appropriate instruments of transfer and the Purchaser shall pay to
the Seller the Purchase Price as provided in Sections 1.3 and 1.4.
Section 1.3 Purchase Price. The final purchase price after any working
capital adjustments to be paid to the Seller for the Subject Assets (the
"Purchase Price") shall be an amount equal to (i) One Million Thirteen Thousand
Six Hundred Forty Dollars ($1,013,640.00) plus (ii) an amount equal to the
Accounts Receivables determined by the parties at Closing.
Section 1.4 Payment of Purchase Price. The Purchase Price shall be
payable by the Purchaser in cash or cash equivalent as well as Purchaser's stock
at Closing. The stock/cash allocation is set forth on Exhibit "A" attached
hereto and incorporated herein by reference. Any stock received shall be subject
to restraints on both timing and quantities of shares to be sold as set forth on
Exhibit "B".
Section 1.5 Assumption of Liabilities and Obligations.
(a) Assumed Liabilities. The following shall be assumed or paid by
Purchaser:
(i) Ordinary trade payables (including obligation to purchase
Borescope for $25,000) up to Twenty-Five Thousand Thirteen Dollars
($25,013.00) as set forth on Exhibit 1.5(a)(i);
(ii) Aviation sales payables if no more than Fifty-Five
Thousand Dollars ($55,000.00); and
(iii) Account Payable on Tonnish Engine transaction of no more
than Two Hundred Twenty-Five Thousand Dollars ($225,000.00) upon full
transfer of engine title to Purchaser.
(b) No Liabilities to be Assumed or Paid (the Excluded Liabilities).
The following shall neither be assumed or paid by Purchaser:
(i) Any liability of the Seller for federal, state or local
income, franchise, sales, use, social security,
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unemployment or withholding taxes, or penalties, interest, fines or
assessments in connection therewith;
(ii) The Seller's liability for ad valorem property taxes and
intangibles taxes with respect to all Assets for 1998 and all years
prior to 1998;
(iii) All accrued fees, expenses and other costs to be borne
by the Seller pursuant to Section 4.4 of this Agreement.
(iv) The Seller's obligations, liabilities, covenants,
commitments and undertakings under this Agreement or any instrument or
agreement entered into pursuant hereto;
(v) All accrued salaries or bonuses to Employees; and
(vi) Any liability relating to the lawsuit by Rich
International Airways, Inc. in the Circuit Court of the 11th Judicial
Circuit in and for Dade County, Florida, General Jurisdiction Division,
Case No. 95-17247 CA.
(c) No Other Liabilities Assumed; Liabilities of the Purchaser After
Closing. The Purchaser is not assuming any of the Seller's liabilities or
obligations, whether known or unknown, contingent or realized; except for the
Assumed Liabilities listed in Section 1.5(a). All liabilities incurred after the
Closing in connection with the Purchaser's operations after the Closing of the
business and assets acquired by the Purchaser hereunder shall be liabilities of
the Purchaser.
Section 1.6 Allocation of Purchase Price. The Purchase Price described
in Section 1.3 above will be allocated among the Subject Assets as described on
Exhibit "A". The Purchaser and the Seller each agrees that it will adopt and
utilize the amounts so allocated for purposes of all federal, state and other
tax returns filed by it and will not voluntarily take any position inconsistent
therewith upon examination of any such tax return, in any claim, in any
litigation or otherwise with respect to such tax returns. Notwithstanding any
other provisions of this Agreement, the foregoing representation, warranty and
agreement shall survive the Closing Date without limitation.
Section 1.7 Status of Stock Issued. The shares of Purchaser's stock to
be issued to the Seller will be "Restricted Stock" and will not have been
registered under the Securities Act of 1933, as amended, or under any laws of
any state, and will bear the following legend in addition to any other legends
required by state law or by other agreements executed contemporaneously
herewith:
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THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT")
OR ANY STATE SECURITIES ACT, AND ARE "RESTRICTED
SECURITIES" WITHIN THE MEANING OF SUCH ACTS. THE SHARES
MAY NOT BE SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE
DISTRIBUTED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION UNDER
SUCH ACTS OR THE RECEIPT OF AN OPINION OF COUNSEL SATISFACTORY
TO THE ISSUER THAT SUCH REGISTRATION IS NOT REQUIRED.
Section 1.8 Registration Rights. Purchaser shall file a Registration
Statement with the Securities and Exchange Commission registering the shares of
stock issued to the Seller upon request of the Seller after July 1, 1999, and
shall use its best efforts to cause the Registration Statement to be filed not
more than six months after the date of such request and to become effective as
soon as practicable thereafter. Furthermore, Purchaser shall maintain such
effectiveness for a minimum period of one year. Purchaser shall pay all expenses
incident to such Registration Statement, except for any commissions or taxes
related to the sale of the shares thereunder. Such registration rights shall be
in accordance with, and subject to, the terms and provisions of the form of
Registration Rights Agreement attached as Exhibit B hereto. The remaining shares
shall have "piggy-back" rights, subject to the reasonable approval of any
managing underwriter, to be included in any Registration Statement filed by
Purchaser within one year as such registration statement relates to an
underwritten public offering of Purchaser's securities.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE SELLER
To induce the Purchaser to enter into this Agreement and to purchase
the Subject Assets, each Seller, jointly and severally, represents and warrants
that:
Section 2.1 Corporate Organization and Authority. The Seller is duly
organized and validly existing in good standing under the laws of the State of
Florida, with full power and authority to conduct its business as now conducted,
own its assets and enter into and perform its obligations under this Agreement.
The Seller's execution, delivery and performance of this Agreement and the sale
to the Purchaser of the Subject Assets have been duly authorized by all
requisite corporate action on the part of the Seller, and this Agreement
constitutes, and all deeds, bills of sale, assignments, agreements and other
instruments and documents to be executed and delivered by the Seller hereunder
will constitute, the Seller's legal, valid and binding obligations, enforceable
against the Seller in accordance with their respective terms.
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Section 2.2 Title to Assets.
(a) Furniture, Equipment, Etc. The Seller has good and marketable title
to the Tangible Property free and clear of all liens, charges, security
interests, easements, reservations, restrictions, encumbrances and other defects
in title (collectively, "Encumbrances"), has the right to convey such Tangible
Property to the Purchaser, at the Closing shall have conveyed to the Purchaser
good and marketable title to such Tangible Property free and clear of all
Encumbrances, and will warrant and defend the title to such Tangible Property in
the Purchaser against the lawful claims of all persons whomsoever.
(b) Inventory. The Seller has good and marketable title to the
Inventory described on the Closing Balance Sheet free and clear of all
Encumbrances, has the right to convey such Inventory to the Purchaser, at the
Closing shall have conveyed to the Purchaser good and marketable title to such
Inventory free and clear of all Encumbrances and will warrant and defend the
title to such Inventory in Purchaser against the lawful claims of all persons
whomsoever.
(c) Intellectual Property. Except as described in Exhibit 2.2(c), the
Seller has exclusive rights to use the Intellectual Property in connection with
its business as and where now conducted and the use of the Intellectual Property
by the Seller in its business as and where now conducted does not violate or
infringe the rights of any other person, nor is the Seller a party to any
agreement with another person or entity with respect to the use of the
Intellectual Property.
Section 2.3 Condition of Tangible Assets.
(a) Tangible Property. All the Tangible Property is in good operating
condition and repair, ordinary wear and tear excepted.
(b) Inventory. The level of Inventory at Closing will not exceed normal
inventory levels necessary to conduct the Seller's business in the ordinary
course of the Seller's business.
Section 2.4 Leases. Except as set forth in Exhibit 2.4, none of the
Tangible Property is leased by the Seller from any other party. There is no
default under the leases described on Exhibit 2.4 and such leases are valid and
enforceable in accordance with their terms.
Section 2.5 Capital Expenditures. Except as described on Exhibit 2.5
hereto, there are no material capital expenditures which the Seller now
anticipates will be required to be made in connection with the Seller's business
as now conducted in order to operate the business or comply with any existing
laws,
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regulations or other governmental requirements applicable to the Seller's
business, including without limitation requirements relating to occupational
health and safety.
Section 2.6 Compliance with Law.
(a) Conduct of Business. The Seller has conducted its business so as to
comply with, and is in compliance with, all laws, statutes, regulations, rules
and other requirements of any governmental authority applicable to it, the
noncompliance with which curing thereof could have a material adverse effect on
the Seller or its business or the Subject Assets.
(b) Pending or Threatened Litigation. Except as described in Exhibit
2.6(b), the Seller is not a party to any claim, action, suit or other proceeding
pending, or to the knowledge of the Seller threatened, before any court, agency
or other judicial, administrative or other governmental body or arbitrator.
(c) Investigations. Exhibit 2.6(c) describes all investigations of the
Seller or the Seller's business known to the Seller conducted by any grand jury,
administrative agency or other governmental authority, and describes all
inspection reports, questionnaires, inquiries, demands, requests for information
and claims of violations or noncompliance with law received by the Seller from
any governmental authority and all written statements or responses of the Seller
with respect thereto, including requests for information from the Internal
Revenue Service or any state department of revenue in connection with audits of
the Seller's income, sales, and use tax returns or routine questionnaires and
requests for information received generally by others in the Seller's industry.
(d) Judgments and Orders. Except as described in Exhibit 2.6(d), there
are no outstanding judgments, tax liens, orders, writs or decrees of any
judicial or other governmental authority binding specifically upon the Seller or
the Subject Assets and not of general application, other than judgments, orders,
writs and decrees with which the Seller has complied and which have no future
applicability.
Section 2.7 Environmental Matters. (a) Except as described in Exhibit
2.7, the Seller and the property owned or used in its business are, and at all
times have been, in compliance with all applicable Federal, state and local
statutes, laws, ordinances, regulations and codes related in any way to
Hazardous Materials (as hereinafter defined) and underground storage tanks. As
used herein, Hazardous Materials shall mean solid waste (as that term is defined
in the Resource Conservation
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and Recovery Act, 42 U.S.C.A. ss.6901, et seq, and the regulations adopted
pursuant thereto), hazardous substances (as that term is defined in the
Comprehensive Environmental Response Compensation and Liability Act, 42 U.S.C.A.
ss.9601, et seq, and the regulations adopted pursuant thereto), and other
pollutants, including, without limitation, any solid, liquid, gaseous or thermal
irritant or contaminant, such as smoke, vapor, soot, fumes, acids, alkaloids or
chemicals.
(b) Except as described in Exhibit 2.7, during Seller's occupancy of
the property used in its business, no Hazardous Materials have been generated,
treated, stored or disposed of at, or transported to or from, the Seller or the
property owned or used in the Seller's business at any time.
(c) Except as described in Exhibit 2.7, no asbestos or materials
containing asbestos have been installed, used, treated, stored or disposed of by
the Seller in or on property owned or used by the Seller at any time.
(d) Except as described in Exhibit 2.7, during Seller's occupancy of
the property used in its business, no polychlorinated biphenyls are located on
or in the facilities of the Seller or any property owned or used by the Seller
at any time.
(e) Except as described in Exhibit 2.7, the Seller holds all necessary
permits or licenses to enable it to comply with all statutes, laws, ordinances,
regulations and codes related in any way to Hazardous Materials or underground
storage tanks.
(f) Except as described in Exhibit 2.7, no notice has been served on
the Seller or any of its directors, officers or shareholders from any entity,
governmental body or individual claiming violation of any statute, law,
ordinance, regulation or code related in any way to Hazardous Materials or
underground storage tanks, requiring compliance with any statute, law,
ordinance, regulation or code related in any way to Hazardous Materials or
underground storage tanks, or demanding payment of or contributions for damage
regarding the Seller or property owned or used by the Seller related in any way
to Hazardous Materials or underground storage tanks, including without
limitation, damages to the environment or natural resources.
Section 2.8 Employee Relations.
(a) Employee Census. Seller has furnished an accurate employee census,
detailing the Employee's date of hire, salary, benefits and other pertinent
information (attached hereto as Exhibit 2.8). There shall have been no increase
in any compensation paid or payable to the employees of Seller unless otherwise
disclosed on Exhibit 2.8 and agreed to by Purchaser.
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(b) No Contracts or Future Contracts. To the best of Seller's
knowledge, Seller has no employment contracts that cannot be terminated without
liability and further, Seller will not contact any Employees to work for Seller
after closing without first obtaining Purchaser's written permission.
Section 2.9 No Material Misstatements or Omissions. To the
best of its knowledge, the representations and warranties of the
Seller in this Agreement do not contain any untrue statement of a material fact
or omit to state any material fact necessary to make the statements made therein
not misleading.
Section 2.10 No Sale of Assets, Etc. Seller has not sold or otherwise
disposed of any of the assets other than sales of inventory in the ordinary
course of business. In addition, Seller has, from the date hereof until Closing,
maintained the reputation of the business being sold hereunder and preserved the
goodwill of suppliers, customers and others having business relationships with
Seller.
Section 2.11 Other Representations and Warranties of Seller.
(a) Knowledge Respecting Purchaser. Seller (i) knows or has had the
opportunity to acquire all information concerning the business affairs,
financial condition, plans and prospects of Purchaser that Seller deems relevant
to make a fully informed decision respecting the acquisition of the stock; (ii)
has been encouraged and has had the opportunity to rely upon the advice of
Seller's legal counsel and accountants and other advisers with respect to the
acquisition of the stock; and (iii) has had the opportunity to ask such
questions and receive such answers and information respecting, among other
things, the business, affairs, financial condition, plans and prospects of
Purchaser and the terms and conditions of the acquisition of the stock as Seller
has requested so as to more fully understand Seller's investment.
(b) Absence of Representations and Warranties. Seller confirms that
neither Purchaser nor anyone purportedly acting on behalf of Purchaser has made
any representations, warranties, agreements or statements other than those
contained herein respecting the business, affairs, financial condition, plans or
prospects of Purchaser nor has Seller relied on any representations, warranties,
agreements or statements in the belief that they were made on behalf of the
foregoing nor has Seller relied on the absence of any such representations,
warranties, agreements or statements in reaching Seller's decision to acquire
the stock.
(c) No Distribution. Seller is acquiring the stock for Seller's own
account without a view to public distribution or
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resale, and Seller has no contract, undertaking, agreement or arrangement to
transfer, sell or otherwise dispose of any of the stock or any interest therein
to any other person.
(d) Shares to be Restricted. Seller understands that the stock will
remain "restricted securities" within the meaning of Rule 144 under the
Securities Act of 1933, as amended (the "1933 Act") and within the "lockup
agreement" required by the underwriter.
(e) No Registration. Seller understands that the stock will not be
registered under the 1933 Act, the state laws and the securities laws of any
other jurisdiction and must be held indefinitely without any transfer, sale or
other disposition unless the stock is subsequently registered under the 1933
Act, state law and the securities laws of any other applicable jurisdictions
pursuant to any attaching "piggy-back" rights or, in the opinion of counsel for
Purchaser, registration is not required under such Acts or laws as the result of
an available exemption.
(d) Legend of Certificates. Seller understands that there shall be
endorsed on the certificates evidencing the stock a legend substantially to the
following effect:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT") OR ANY
STATE SECURITIES ACT, AND ARE "RESTRICTED SECURITIES" WITHIN
THE MEANING OF SUCH ACTS. THE SHARES MAY NOT BE SOLD,
TRANSFERRED, HYPOTHECATED OR OTHERWISE DISTRIBUTED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION UNDER SUCH ACTS OR THE
RECEIPT OF AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER
THAT SUCH REGISTRATION IS NOT REQUIRED."
(e) Restrictions on Other Securities. Seller understands that, except
upon certain limited circumstances, the restrictions on the sale, transfer and
disposition of the stock will also apply to any and all shares of capital stock
or other securities issued or otherwise acquired with respect to the stock
including, without limitation, shares and securities issued or acquired as a
result of any stock dividend, stock split or exchange or any distribution of
shares or securities pursuant to any corporate reorganization, reclassification
or similar event.
(f) Stop Orders. Seller understands that Purchaser and its transfer
agent may refuse to effect a transfer, sale or other disposition of any of the
stock by Seller or Seller's successors or assigns otherwise than as contemplated
hereby.
(g) No Governmental Approval. Seller understands that no federal or
state agency has approved or disapproved the stock,
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passed upon or endorsed the merits of the offering of the stock, or made any
finding or determination as to the fairness of the stock for investment.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
To induce the Seller to enter into this Agreement and to sell the
Subject Assets, the Purchaser hereby represents and warrants that:
Section 3.1 Corporate Organization and Authority. The Purchaser is a
corporation duly organized and validly existing and in good standing under the
laws of the State of North Carolina, with full corporate power and authority to
conduct its business as now conducted and to enter into and perform its
obligations under this Agreement. The Purchaser's execution, delivery and
performance of this Agreement and its acquisition of and payment for the Subject
Assets have been duly authorized by all requisite corporate action on the part
of the Purchaser, and this Agreement constitutes, and all agreements and other
instruments and documents to be executed and delivered by the Purchaser
hereunder will constitute, the Purchaser's legal, valid and binding obligations,
enforceable against the Purchaser in accordance with their terms.
Section 3.2 Absence of Conflicts and Consent Requirements. The
Purchaser's execution and delivery of this Agreement and performance of its
obligations hereunder, including the purchase of and payment for the Subject
Assets hereunder, do not and will not conflict with, violate or result in any
default under the Purchaser's Articles of Incorporation or Bylaws or any
mortgage, indenture, agreement, instrument or other contract to which the
Purchaser is a party or by any judgment, order, decree, law, statute, regulation
or other judicial or governmental restriction to which the Purchaser is subject.
The Purchaser's execution and delivery of this Agreement and performance of its
obligations hereunder, including the purchase of and payment for the Subject
Assets, do not and will not require the consent of, or any prior filing with or
notice to, any governmental authority or other third party.
Section 3.3 No Material Misstatements or Omissions. The representations
and warranties of the Purchaser in this Agreement do not contain any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements made therein not misleading.
ARTICLE IV
CERTAIN COVENANTS AND AGREEMENTS
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Section 4.1 Further Assurances. The Seller and the Purchaser each
hereby covenants and agrees with the other that at any time and from time to
time each will promptly execute and deliver to the other such further
assurances, instruments and documents and take such further action as the other
may reasonably request in order to carry out the full intent and purpose of this
Agreement.
Section 4.2 Fees and Expenses. The Seller and the Purchaser shall each
bear their own expenses in connection with the negotiation and preparation of
this Agreement and their consummation of the transactions contemplated hereby,
including without limitation the fees and expenses of their respective counsel,
accountants and consultants.
Section 4.3 No Brokers. The Seller and the Purchaser each represent and
warrant to the other that no broker or finder has been involved or engaged by it
in connection with the transactions contemplated hereby, and each hereby agrees
to indemnify and save harmless the other from and against any and all broker's
or finder's fees, commissions or similar charges incurred or alleged to have
been incurred by the indemnifying party in connection with the transactions
contemplated hereby and any and all loss, liability, cost or expense (including
reasonable attorneys' fees) arising out of any claim that the indemnifying party
incurred any such fees, commissions or charges.
Section 4.4 Bulk Transfer Compliance. Inasmuch as the Seller has agreed
to duly pay, perform and discharge the Excluded Liabilities and Obligations, the
Purchaser and the Seller hereby mutually agree to waive compliance with the
provisions of the Florida Bulk Sales laws and of the corresponding laws of any
other jurisdiction, to the extent applicable to the transactions contemplated
hereby. The Seller covenants and agrees to indemnify and save harmless the
Purchaser from and against any and all loss, liability, cost and expense
(including reasonable attorneys' fees) arising out of noncompliance with said
Bulk Transfers.
ARTICLE V
CONDITIONS TO CLOSING
Section 5.1 Conditions to the Purchaser's Obligations. The obligations
of the Purchaser to complete the Closing are contingent upon the fulfillment of
each of the following conditions on or before the Closing Date, except to the
extent that the Purchaser may, in its absolute discretion, waive any one or more
thereof in whole or in part:
(a) Instruments of Transfer. The Seller shall have delivered to the
Purchaser such assignments, bills of sale, deeds, certificates of title and
other instruments of transfer, all in
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form reasonably satisfactory to the Purchaser, as are necessary to fully and
effectively convey to the Purchaser all of the Subject Assets in accordance with
the terms hereof and shall have executed the Consignment Agreement.
(b) No Material Adverse Change. On the date of Closing, there shall not
have occurred any event or condition materially and adversely affecting the
financial condition, results of operations or business prospects of the Seller
from those reflected on the enclosed Financial Statements, except for matters
resulting from adverse changes in economic conditions affecting businesses
generally.
(c) No Adverse Proceedings. No action, suit or proceeding before any
court or any governmental or regulatory authority shall have been commenced, no
investigation by any governmental or regulatory authority shall have been
commenced, and no action, suit or proceeding by any governmental or regulatory
authority shall have been threatened against any of the parties to this
Agreement, or any of the principals, officers or directors of any of them, or
any of the Subject Assets seeking to restrain, prevent or change the
transactions contemplated hereby or questioning the validity or legality of any
of such transactions or seeking damages in connection with any of such
transactions.
(d) Other Assurances. The Seller shall have delivered to the Purchaser
such other and further certificates, assurances and documents as the Purchaser
may reasonably request in order to evidence the accuracy of the Seller's
representations and warranties, the performance of its covenants and agreements
to be performed at or prior to the Closing, and the fulfillment of the
conditions to the Purchaser's obligations.
(e) Lease of Facilities. Purchaser and the owner shall enter into
leases for the facilities in which Seller's business is presently located (the
"Leases").
(f) Closing on JT-3/ASAP. M. Xxxx Xxxxx shall have satisfactorily
negotiated and closed on the JT-3/ASAP consignment with a payment of $175,000.00
for the consignment rights.
(g) Director and Shareholder Approval. All necessary director and
shareholder approval shall be given by Seller.
Section 5.2 Conditions to the Seller's Obligations. The obligations of
the Seller to complete the Closing are contingent upon the fulfillment of each
of the following conditions on or before the Closing Date, except to the extent
that the Seller may, in its absolute discretion, waive any one or more thereof
in whole or in part:
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(a) Payment of Purchase Price. The Purchaser shall have paid to the
Seller the Purchase Price.
(b) Employment Agreement. Purchaser shall enter into an employment
agreement with M. Xxxx Xxxxx substantially in the form of Exhibit 5.2(b) hereto.
(c) No Adverse Proceedings. No action, suit or proceeding before any
court or any governmental or regulatory authority shall have been commenced, no
investigation by any governmental or regulatory authority shall have been
commenced, and no action, suit or proceeding by any governmental or regulatory
authority shall have been threatened, against any of the parties to this
Agreement, or any of the principals, officers or directors of any of them, or
any of the Subject Assets, seeking to restrain, prevent or change the
transactions contemplated hereunder or questioning the validity or legality of
any of such transactions or seeking damages in connection with any of such
transactions.
(d) Other Assurances. The Purchaser shall have delivered to the Seller
such other and further certificates, assurances and documents as the Seller may
reasonably request in order to evidence the accuracy of the Purchaser's
representations and warranties, the performance of its covenants and agreements
to be performed at or prior to the Closing, and the fulfillment of the
conditions to the Seller's obligations.
(e) Director Approval. The Agreement shall have been approved by the
Directors of the Purchaser.
ARTICLE VI
INDEMNIFICATION
Section 6.1 Indemnification by the Seller. Subject to the procedures
and limitations set forth in this Article VI, the Seller hereby agrees to
indemnify and save harmless the Purchaser from and against any and all
liabilities, losses, claims, judgments, damages, expenses and costs (including,
without limitation reasonable counsel fees and costs and expenses incurred in
connection therewith) (a "Loss") incurred by the Purchaser arising after the
Closing out of any of the following:
(a) Breach of Warranty. The falsity or incorrectness of any
representation or warranty made by the Seller in this Agreement or in any
instrument or document delivered by the Seller to the Purchaser pursuant to this
Agreement;
(b) Breach of Covenants. The Seller's failure to duly perform any
covenant or agreement to be performed by it under this Agreement or under any
instrument or document delivered by the Seller to the Purchaser pursuant to this
Agreement;
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(c) Claims Against Subject Assets. Any levy or other claim by any third
party against or with respect to the Subject Assets, or any other claim by any
third party against the Purchaser, arising out of any act or omission or alleged
act or omission of the Seller prior to the Closing.
The Purchaser shall have the right to be put in the same financial position as
it would have been in had each of the representations and warranties of the
Seller been true and correct or had the Seller not breached any representations,
warranties, covenants or agreements.
Section 6.2 Survival of the Seller's Warranties. The representations
and warranties of the Seller made in this Agreement or in any instrument or
document delivered by the Seller to the Purchaser pursuant to this Agreement
shall survive the Closing.
Section 6.3 Indemnification by the Purchaser. After the Closing, the
Purchaser agrees that it will indemnify and save harmless the Seller from and
against any and all loss, liability, damages, cost or expense (including
reasonable attorneys' fees) incurred by the Seller (net of any benefits to the
Seller) arising out of the Purchaser's breach of any of its representations,
warranties, covenants and agreements in this Agreement or in any document
delivered by the Purchaser to the Seller hereunder.
ARTICLE VII
MISCELLANEOUS
Section 7.1 Merger Clause. This Agreement contains the final, complete
and exclusive statement of the agreement between the parties with respect to the
transactions contemplated herein and all prior or contemporaneous written or
oral agreements with respect to the subject matter hereof are merged herein.
Section 7.2 Amendments. No change, amendment, qualification or
cancellation hereof shall be effective unless in writing and executed by each of
the parties hereto by their duly authorized officers.
Section 7.3 Benefits and Binding Effect. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, personal representatives, successors and assigns.
Section 7.4 Notices. All notices, requests and demands and other
communications hereunder must be in writing and shall be deemed to have been
duly given when (i) personally delivered, (ii) when forwarded by Federal
Express, Airborne or another private carrier which maintains records showing
delivery information, (iii) when sent via facsimile transmission but only if a
written or
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facsimile acknowledge of receipt is received by the sending party, or (iv) when
placed in the United States Mails and forwarded by Registered or Certified Mail,
return receipt requested, postage prepaid, addressed to the party to whom such
notice is being given at the following addresses:
AS TO THE SELLER: Global Turbine Services, Inc.
Hollywood-X. Xxxxx Airport
0000 Xxxxxxxx Xxxx
Xxxxxxxx Xxxxx, XX 00000
Turbine Inspections, Incorporated
Hollywood-X. Xxxxx Airport
0000 Xxxxxxxx Xxxx
Xxxxxxxx Xxxxx, XX 00000
AS TO THE PURCHASER: American Aircarriers Support,
Incorporated
Attn: Xxxx X. Xxxxx
P. O. Xxx 0000
Xxxxxxxxx, XX 00000
WITH COPY TO: Xxxxx X. Xxxx
Xxxx, Layton, Kersh, Solomon,
Sigmon, Xxxx & Xxxxx, P.A.
P. O. Xxx 0000
Xxxxxxxx, XX 00000-0000
Any party may change the address(es) to which notices to it are to be sent by
giving notice of such change to the other parties in accordance with this
Section.
Section 7.5 Captions. The captions are for convenience of reference
only and shall not be construed as a part of this Agreement.
Section 7.6 Governing Law. This Agreement shall be construed,
interpreted, enforced and governed by and under the laws of the State of
Florida.
Section 7.7 Exhibits. All of the Exhibits hereto referred to in this
Agreement are hereby incorporated herein by reference and shall be deemed and
construed to be a part of this Agreement for all purposes.
Section 7.8 Severability. The invalidity or unenforceability of any one
or more phrases, sentences, clauses or provisions of this Agreement shall not
affect the validity or enforceability of the remaining portions of this
Agreement or any part thereof.
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Section 7.9 Counterparts. This Agreement may be executed in any number
of counterparts, all of which shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Seller and the Purchaser have each caused this
Agreement to be executed by their respective duly authorized officers under
seal, all as of the day and year first above written.
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SELLER:
GLOBAL TURBINE SERVICES, INC.
By /s/ Xxxx Xxxxx
-----------------------------
President
ATTEST:
/s/ Xxxxx X. Xxxxx
---------------------------
Secretary
TURBINE INSPECTIONS, INCORPORATED
By /s/ Xxxx Xxxxx
-----------------------------
President
ATTEST:
/s/ Xxxxx X. Xxxxx
---------------------------
Secretary
PURCHASER:
AMERICAN AIRCARRIERS SUPPORT,
INCORPORATED
By /s/ Xxxx X. Xxxxx
-----------------------------
President
ATTEST:
/s/ Xxxxx X. Xxxx
---------------------------
Secretary
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EXHIBIT "A"
OPERATING ASSETS
* 1) Property, plant, furniture and
equipment: $ 85,540
* 2) Inventory: $ 410,000
** 6) Buyout Joint Venture #1: $ 262,500
** 7) Buyout Joint Venture #2: $ 255,600
8) Accounts Receivable (assuming
collectability) $ 91,392
----------
$1,105,032
* = Cash
** = Stock
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EXHIBIT "B"
REGISTRATION RIGHTS AGREEMENT
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EXHIBIT 1.1(c)
CONSIGNMENT AGREEMENT
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EXHIBIT 1.5(a)(i)
ORDINARY TRADE PAYABLES
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EXHIBIT 2.4
LEASES
None
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EXHIBIT 2.2(c)
INTELLECTUAL PROPERTY
None
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EXHIBIT 2.5
CAPITAL EXPENDITURES
Big forklift is needed to be purchased.
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EXHIBIT 2.6(b)
PENDING OR THREATENED LITIGATION
None
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EXHIBIT 2.6(c)
INVESTIGATIONS
None
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EXHIBIT 2.6(d)
JUDGMENTS and ORDERS
None
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EXHIBIT 2.7
ENVIRONMENTAL MATTERS
1. A HAZMAT will not be done.
2. There is a waste oil tank. It is used and is contained.
3. There are no underground storage tanks that are part of Seller's
leasehold.
4. Xxxx Xxxxx will remove any HAZMAT at his own expense.
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EXHIBIT 2.8
EMPLOYEE CENSUS
EMPLOYEE W-4 GROSS FICA WITHHOLDING NET
-------- --- ----- ---- ----------- ---
Xxxxxxx Xxxxx M-0 $5,000.00 $1,333.85 $ 382.50 $3,283.65
Xxxxxx Xxxxx*** X-0 $2,500.00 $ 432.00 $ 191.25 $1,876.75
Xxxxxx Xxxxxxxx S-0 $1,826.92 $ 363.00 $ 139.76 $1,324.16
Xxxxxxx Xxxxxxxx* M-2 $1,923.08 $ 206.00 $ 147.11 $1,630.17
Xxxxx Xxxxxx**** S-0 $1,100.00 $ 161.00 $ 84.15 $ 854.85
Xxxxx Xxxxx** S-3 $ 668.00 $ 38.00 $ 51.11 $ 578.89
Note: 26 pay periods
* = As of 8/3/98 added to the payroll
** = As of 8/24/98 added to the payroll
*** = As of 9/4/98 deleted from the payroll
**** = As of 8/3/98 pay increase from $26,000 to $28,600
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EXHIBIT 5.2(b)
EMPLOYMENT AGREEMENT
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